L&A Designs LLC et al v. Xtreme ATVs, Inc. et al
Filing
49
OPINION & ORDER: The court grants plaintiffs' motion for leave to file an amended complaint 32 to add Natalie Clunan as a party defendant. Plaintiffs shall file an amended complaint within five days of this order. See 5-page opinion & order attached. Signed on 11/28/2011 by Judge Marco A. Hernandez. (mr)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
PORTLAND DIVISION
L&A DESIGNS, LLC, an Oregon
company, and WESLEY ALFORD, an
individual,
No. 03:10-CV-627-HZ
OPINION & ORDER
Plaintiffs,
v.
XTREME ATVS, INC., a Connecticut
corporation, and ANDREW R. CLUNAN,
an individual,
Defendants.
Kurt M. Rylander
Mark E. Beatty
Rylander & Associates, PC
406 West 12th Street
Vancouver, WA 98660
1 - OPINION & ORDER
Attorneys for Plaintiff
Kenneth R. Davis , II
Parna A. Mehrbani
Lane Powell P.C.
601 SW Second Avenue, Suite 2100
Portland, OR 97204-3158
Attorneys for Defendant
HERNANDEZ, District Judge:
Plaintiffs move for leave to file an amended complaint to add Natalie Clunan as a party
defendant. I grant the motion.
BACKGROUND
Plaintiff L&A Designs, LLC markets, distributes, and sells all terrain vehicle (“ATV”)
parts. Compl. ¶5. Plaintiff Wesley Alford owns 100% of L&A Designs. Id. Defendant Xtreme
ATVs, Inc. also sells ATV parts and is controlled by defendant Andrew Clunan. Answer, ¶¶ 6,
15. Plaintiffs allege trademark infringement and dilution, unfair competition, and unfair trade
practices regarding use of the trademark “L&A Designs”. Compl. ¶¶49-101. Plaintiffs’ claims
are partially based on allegations that several of defendants’ websites unlawfully use the L&A
Designs trademark. Id. at ¶¶15, 21, 22.
On April 13, 2011, defendants amended their answers to plaintiffs’ first interrogatories.
Decl. of Mark Beatty in Supp. of Mot. for Leave to File Am. Compl. (“Beatty Decl.”) Ex. B.
Plaintiffs learned for the first time that Natalie Clunan designed and continues to maintain
defendants’ websites that allegedly infringe on plaintiffs’ trademark. Id. at Am. Resp. to
Interrogatory No. 5. On August 16th, plaintiffs notified defendants that they intended to add
Natalie Clunan, defendant Andrew Clunan’s wife, as a party defendant. Pls.’ Memo. in Supp. of
2 - OPINION & ORDER
Mot. for Leave to File Am. Compl. (“Pls.’ Mot. to Amend”), 4. Lead counsel for defendants was
on sabbatical leave1, but co-counsel for defendants responded that they would not consent to the
amendment. Id. Plaintiffs filed the present motion on October 13th. Dkt. #32.
Discovery will close in this case on December 8th. May 6, 2011 Scheduling Order
(“5/6/11 Order”), Dkt. #27. However, plaintiffs have already deposed Natalie Clunan. Pls.’
Reply in Supp. of Mot. for Leave to File Am. Compl. (“Pls.’ Reply”), 2. Dispositive motions
have yet to be filed, as they are due next year by January 6th. 5/6/11 Order, Dkt. #27. Trial has
been set for May 1, 2012. Id. The only other pending motion is plaintiffs’ motion to compel
documents, which was filed on November 9th. Dkt. #41. Defendants have obtained an
extension of time to respond to the motion to compel by November 30th. Dkt. #48.
STANDARDS
Federal Rule of Civil Procedure 15(a) provides that leave to amend a complaint “shall be
freely given when justice so requires.” The court should apply the rule’s “policy of favoring
amendments with extreme liberality.” DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 186 (9th
Cir. 1987) (internal quotation omitted); Owens v. Kaiser Found. Health Plan, Inc., 244 F.3d 708,
712 (9th Cir. 2001). The district court may deny leave to amend if the amendment “(1)
prejudices the opposing party; (2) is sought in bad faith; (3) produces an undue delay in
litigation; or (4) is futile.” AmerisourceBergen Corp. v. Dialysist West, Inc., 465 F.3d 946, 951
(9th Cir. 2006). Prejudice to the opposing party is given greater weight in the analysis.
1
Lead counsel Kenneth Davis notified the court that he would be on sabbatical from the
first week of June until the last week of August. Dkt. #20. Although it now appears that Davis
started his sabbatical in July. Defs.’ Memo. in Resp. Mot. for Leave to File Am. Compl. (“Defs.’
Resp.”), 3, n.1.
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Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). Delay, by itself,
will not justify denying leave to amend. DCD Programs, 833 F.2d at 186. The timing of the
motion to amend following discovery and with a pending summary judgment motion, weighs
heavily against allowing leave. Schlacter-Jones v. General Telephone, 936 F.2d 435, 443 (9th
Cir. 1991).
DISCUSSION
Plaintiffs argue that none of the factors prevent this Court from granting leave to amend
the complaint to name Natalie Clunan as a party defendant. In particular, plaintiffs argue that
there is no prejudice to defendants. Pls.’ Mot. to Amend, 7. First, Natalie Clunan was on notice
August 16th, and potentially last April, when defendants amended their answers to the
interrogatories. Id. Further, adding Ms. Clunan as a defendant will only mean that she may be
held jointly and severally for damages. Id. at 8. More importantly, there will not be any new
legal theories of recovery. Id. Plaintiffs also contend that there is no undue delay in moving to
amend the complaint. Id. They discovered Ms. Clunan’s role in April, notified the defendants in
August, and filed the motion in October. Defendants disagree that there is no prejudice. Defs.’
Resp., 3. The only prejudice that defendants raise is a delay in litigation. Id. Defendants also
note that the deadline for joining all parties was November 1, 2010.
Defendants have not raised any prejudice that would justify denying the motion. As
previously noted, delay alone is not a sufficient reason to deny leave to amend the complaint.
Although defendant is correct that the deadline to join all parties has passed, defendant did not
reveal Ms. Clunan’s role in creating and maintaining the allegedly infringing websites until this
past April–five months after the deadline had passed. Plaintiffs cannot be blamed for missing a
4 - OPINION & ORDER
deadline that depended on accurate information from defendants.
Defendants also point out the futility of adding Ms. Clunan as a party defendant, asserting
that there is no personal jurisdiction over Ms. Clunan, and that any claim against Ms. Clunan has
already been brought against her husband. Defs.’ Resp., 4. Plaintiffs have taken Ms. Clunan’s
deposition in which she indicated that she has processed numerous orders on behalf of Xtreme
ATVs to customers in Oregon. Decl. of Mark Beatty in Supp. Reply (“Second Beatty Decl.”)
Exs. F, I. Ms. Clunan has also operated two separate online businesses, AFXHelmets.com and
ETONparts.com, that also may have generated sales to Oregon customers. Id. It is possible that
Ms. Clunan may be subject to the jurisdiction of this Court given these facts.
CONCLUSION
Based on the foregoing, I grant plaintiffs’ motion for leave to file an amended complaint
(#32) to add Natalie Clunan as a party defendant. Plaintiffs shall file an amended complaint
within five days of this order.
IT IS SO ORDERED.
Dated this 28th
day of November, 2011.
/s/ Marco A. Hernandez
MARCO A. HERNANDEZ
United States District Judge
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