Williams v. Inflection Energy, LLC et al

Filing 90

MEMORANDUM (Order to follow as separate docket entry).Signed by Honorable Matthew W. Brann on 8/22/16. (km)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
MICHAEL WILLIAMS,

Plaintiff,
v.
INFLECTION ENERGY, LLC,
U.S. WELL SERVICES LLC and
U.S WELL SERVICES INC.,
Defendant/Third Party Plaintiff
v.
HYPERION SAFETY SERVICES, LLC,
Third Party Defendant.

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Civil Action No. 4:15-00675

(Judge Brann)

MEMORANDUM
August 22, 2016
Pending before this Court is a motion for partial summary judgment filed by
Defendant Inflection Energy, LLC (hereinafter “Inflection”) and a motion to
dismiss/motion to strike filed by Defendant U.S. Well Services, LLC (hereinafter
“U.S. Well”). In its motion for summary judgment, Inflection seeks summary
judgment on its cross-claim for contractual defense and indemnity against U.S.
Well together with the dismissal of U.S. Well’s crossclaim for contractual
indemnification against Inflection. U.S. Well’s motion to dismiss seeks to dismiss
Inflection’s cross-claim against U.S. Well, which requests a declaratory judgment,
1

together with a motion to strike, which seeks to strike Inflection’s second amended
answer, affirmative defenses, and cross-claim.
The contract between Inflection and U.S. Well (hereinafter “the Master
Service Agreement”) contains a choice of law provision which requires application
of Colorado law. Both Inflection and U.S. Well set forth legal arguments pursuant
to Colorado law; this Court will, therefore, assume that neither party objects to its
application in the matters at hand.1
These matters are now ripe for disposition. In accordance with the following
reasoning, Inflection’s motion for partial summary judgment is granted and U.S.
Well’s motion to strike is denied. Inflection’s declaratory judgment cross-claim is
also dismissed as moot and U.S. Well’s motion to dismiss is consequently granted.
I. BACKGROUND AND PROCEDURAL HISTORY
The instant lawsuit arises from personal injuries suffered by Plaintiff,
Michael Williams, while performing work for Trinity Medical Management
Services LLC and/or Hyperion Safety Services, LLC (hereinafter “Hyperion”), on
a well site owned and operated by Inflection in Lycoming County, Pennsylvania.
Plaintiff initiated the present action on January 5, 2015, by filing a complaint
against Inflection, U.S. Well, and U.S. Well Services, Inc. in the Eastern District of
1

See Gay v. CreditInform, 511 F.3d 369, 389 (3d Cir. 2007) (“Pennsylvania courts generally honor the intent of the
contracting parties and enforce choice of law provisions in contracts executed by them.”). The court in Gay goes on
to say that Pennsylvania courts have adopted section 187 of the Restatement (Second) Conflict of Laws, which
provides that contractual choice of law provisions will be enforced except in certain circumstances. Gay, 511 F.3d
at 389.

2

Louisiana. Shortly thereafter, the action was transferred to this Court. Both
Inflection and U.S. Well filed answers to Plaintiff’s complaint. U.S. Well’s answer,
however, included a crossclaim against Inflection for common law contribution
and indemnification, as well as contractual indemnification. In response, Inflection
filed a motion to dismiss U.S. Well’s cross-claim2 and an amended answer3 in
which it asserted a breach of contract cross-claim against U.S. Well.
In its motion to dismiss, Inflection sought to dismiss U.S. Well’s contractual
indemnification count on the basis that, pursuant to the Master Service Agreement,
Inflection was not required to indemnify U.S. Well for personal injury claims
initiated by U.S. Well’s own subcontractors. This Court denied Inflection’s motion
because, at the time it was filed, it was unclear which party, U.S. Well or
Inflection, had actually contracted with Hyperion, Plaintiff’s employer.
Three days after this Court’s Order was docketed, U.S. Well filed a thirdparty complaint against Hyperion seeking indemnification pursuant to a written
contract it had entered into with U.S. Well.4 Inflection then filed the instant motion
for partial summary judgment seeking indemnification from U.S. Well pursuant to
the Master Service Agreement.5 Inflection also filed a second amended answer
which added a cross-claim against U.S. Well, seeking contribution and indemnity

2

ECF No. 28.
ECF No. 27.
4
ECF No. 43.
5
ECF No. 56.
3

3

and seeking a declaratory action pursuant to 28 U.S.C. § 2201.6 In response, U.S
Well filed the instant motion to dismiss and motion to strike.
II. MOTION FOR PARTIAL SUMMARY JUDGMENT
Inflection contends that it is entitled to judgment in its favor on both its
cross-claim for contractual defense and indemnity as well as on U.S. Well’s crossclaim for contractual defense and indemnity. It argues that it is indisputable that
Plaintiff was employed by Hyperion and that U.S. Well hired Hyperion as a
subcontractor. It contends that there is no genuine issue of material fact regarding
the Master Service Agreement, and that, pursuant to the plain language of the
same, U.S. Well must defend and indemnify Inflection.
A. Legal Standard
Summary judgment is appropriate where “the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.”7 A fact is “material” where it “might affect the outcome of the suit
under the governing law.”8 A dispute is “genuine” where “the evidence is such
that a reasonable jury,” giving credence to the evidence favoring the nonmovant
and making all inferences in the nonmovant’s favor, “could return a verdict for the
nonmoving party.”9

6

ECF No. 67.
Fed. R. Civ. P. 56(a).
8
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
9
Id.
7

4

The burden of establishing the nonexistence of a “genuine issue” is on the
party moving for summary judgment.10 The moving party may satisfy this burden
by either (i) submitting affirmative evidence that negates an essential element of
the nonmoving party’s claim; or (ii) demonstrating to the Court that the nonmoving
party’s evidence is insufficient to establish an essential element of the nonmoving
party’s case.11
Where the moving party’s motion is properly supported, the nonmoving
party, to avoid summary judgment in his opponent’s favor, must answer by setting
forth “genuine factual issues that properly can be resolved only by a finder of fact
because they may reasonably be resolved in favor of either party.”12 For movants
and nonmovants alike, the assertion “that a fact cannot be or is genuinely disputed
must” be supported by “materials in the record” that go beyond mere allegations,
or by “showing that the materials cited do not establish the absence or presence of
a genuine dispute, or that an adverse party cannot produce admissible evidence to
support the fact.”13
“When opposing summary judgment, the non-movant may not rest upon
mere allegations, but rather must ‘identify those facts of record which would

10

In re Bressman, 327 F.3d 229, 237 (3d Cir. 2003) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 331 (1986)
(Brennan, J., dissenting)).
11
Id. at 331.
12
Anderson, 477 U.S. at 250.
13
Fed. R. Civ. P. 56(c)(1); see also Anderson, 477 U.S. at 248–50.

5

contradict the facts identified by the movant.’”14 Furthermore, “[i]f a party fails to
properly support an assertion of fact or fails to properly address another party’s
assertion of fact as required by Rule 56(c), the court may . . . consider the fact
undisputed for purposes of the motion.”15
In deciding the merits of a party’s motion for summary judgment, the
Court’s role is not to evaluate the evidence and decide the truth of the matter, but
to determine whether there is a genuine issue for trial.16 Credibility determinations
are the province of the factfinder, not the district court.17 Although the Court may
consider any materials in the record, it need only consider those materials cited.18
B. Discussion
As stated above, Inflection argues that it is entitled to judgment in its favor
on both its cross-claim for contractual defense and indemnity and on U.S. Well’s
cross-claim for contractual defense and indemnity based on the plain language of
the Master Service Agreement. In opposing Inflection’s motion, U.S. Well
advances two arguments. I will discuss each in turn.

14

Port Auth. of N.Y. and N.J. v. Affiliated FM Ins. Co., 311 F.3d 226, 233 (3d Cir. 2003).
Fed. R. Civ. P. 56(e)(2).
16
Anderson, 477 U.S. at 249.
17
BWM, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d Cir. 1992).
18
Fed. R. Civ. P. 56(c)(3).
15

6

1. Inflection’s motion is premature in that the parties have yet to conduct
adequate discovery to determine the parties’ obligations.
U.S. Well argues that it, as well as Inflection, have indemnification
obligations under the Master Service Agreement and, therefore, discovery is
needed to determine the liability of the parties, if any. It further contends that,
according to the Plaintiff’s complaint, Inflection was negligent in failing to
maintain the premises in safe condition by removing snow and ice. Therefore,
discovery is needed to discover facts establishing negligence to determine liability.
Colorado law generally allows contracting parties to enter into indemnity
agreements; they are “subject to the same rules of construction that govern”
general contract interpretation.19 “Hence [an indemnity agreement] should be
enforced according to the plain and generally accepted meaning of its language and
interpreted in its entirety to give effect to all of its provisions so that none are
rendered meaningless.”20 They should generally be construed to effectuate rather
than defeat the parties’ intentions.21 Any ambiguities in the language of the
provision will be resolved against the party seeking indemnity.22

19

See Mid Century Ins. Co. v. Gates Rubber Co., 43 P.3d 737, 739 (Colo. App. 2002); see also East Ridge of Fort
Collins, LLC v. Larimer & Weld Irrigation Co., 109 P.3d 969, 974 (Colo. 2005) (“It is axiomatic that a contract
must be construed to ascertain and effectuate the intent of the parties as determined primarily from the language of
the contract. To this end, the instrument’s language must be examined and construed in harmony with the plain and
generally accepted meaning of the words used.”).
20
Id.
21
See Williams v. White Mountain Const. Co., Inc., 749 P.2d 423, 426 (Colo. 1988) (citing Gardner Bros. & Glenn
Constr. Co. v. American Surety Co., 37 P.2d 384, 386 (Colo. 1934).
22
Williams, 749 P.2d at 426.

7

The contract at issue, the Master Service Agreement, contains reciprocal
indemnification provisions. It states, in relevant part:
5.2 [U.S. Well] shall release Company Group from any liability for, and
shall protect, Defend and indemnify Company Group from and against all
Losses, without limit and without regard to the cause or causes thereof or
the negligence of any party or parties, arising in connection herewith in
favor of Contractor Group and Contractor Group’s employees on account of
bodily injury, death, or damage to property. . . .
5.3 [Inflection] shall release Contractor Group from any liability for, and
shall protect, Defend and indemnify Contractor Group from and against all
Losses, without limit and without regard to the cause or causes thereof or
the negligence of any party or parties, arising in connection herewith in
favor of Company Group or Company Group’s employees on account of
bodily injury, death or damage to property. . . .23
In Section 5.1(a), “Company Group” is defined as “[Inflection], its parent,
affiliate, and subsidiary entities, its and their joint venturers, joint interest owners,
partners, co-owners, co-lessees, contractors and subcontractor of any tier (other
than Contractor and its subcontrators) and the respective directors, officers, agents,
representatives, employees and invitees of all the foregoing.”24 In Section 5.1(b),
“Contractor Group” is defined as “[U.S. Well], [U.S. Well]’s parent, affiliate, and
subsidiary entities, and subcontractors of any tier, and each of their respective
directors, officers, agents, representatives, employees and invitees.”25

23

ECF No. 58-1 at 4 (emphasis added).
Id. at 3.
25
Id. at 4.
24

8

In the case at bar, it is undisputed that Plaintiff was an employee of
Hyperion. After considering the agreement between U.S. Well and Hyperion,26
together with U.S. Well’s answer to Inflection’s first amended answer27 and U.S.
Well’s third-party complaint against Hyperion28 (in which U.S. Well seeks
contribution and indemnification from Hyperion pursuant to the agreement
between U.S. Well and Hyperion), it is now clear to this Court that Hyperion was a
subcontractor of U.S. Well.
According to the plain language of the Master Service Agreement, U.S. Well
agreed to indemnify Inflection for and defend from “all losses” arising from bodily
injury, death, or damage to the property of the Contractor Group or its
employees.29 “Contractor group” includes “subcontractors of any tier.”30 As
Hyperion is U.S. Well’s subcontractor, U.S. Well has agreed to indemnify
Inflection for the losses arising from the bodily injuries of Hyperion’s employees.
Not only did U.S. Well contract to indemnify Inflection for these losses, it
agreed to do so “without regard to the cause or causes thereof or the negligence of
any party or parties.”31 An indemnification provision that purports to render the
indemnitor liable for the indemnitee’s conduct, while lawful, must contain “clear

26

ECF No 58-1 at 31.
ECF No. 32 at 7.4 (“It is admitted that U.S. Well Services, LLC contracted with Plaintiff’s employer, Hyperion
Safety Services, LLC to perform a portion of that work.”).
28
ECF No. 43.
29
ECF No. 58-1 at 5.2.
30
Id. at 5.1(b).
31
Id. at 5.2.
27

9

and unequivocal language to that effect.”32 This means that “a contractual
provision should not be construed to permit an indemnitee to recover for his own
negligence unless the court is firmly convinced that such an interpretation reflects
the intention of the parties.”33 While agreements that indemnify for the negligent
conduct of an indemnitee are generally strictly construed, broad, all-inclusive
language may nevertheless meet the rule of strict construction when it is sufficient
to express the parties’ intent in a commercial context.34 This is because courts have
found that there is parity in bargaining power between sophisticated corporations
bargaining at arms-length.35
In the matter at hand, neither party advances any argument that the
indemnification provision at hand is unclear. Indeed, it is not. The contract
unambiguously states that all losses arising from bodily injury, death, or damage to
property of an employee or subcontractor will be indemnified “without regard to
the cause . . . or negligence of any party . . . ”36 Thus, U.S. Well’s contention that
this motion is premature is without merit. In accordance with the plain language of
the contract, U.S. Well must indemnify Inflection without regard to any negligence
on its part.

32

Williams, 749 P.2d at 426.
Public Service Co. v. United Cable Television of Jeffco, Inc., 829 P.2d 1280, 1283-84 (Colo. 1992) (quoting U.S.
v. Seckinger, 397 U.S. 203, 211 (1970)).
34
Public Service Co., 829 P.2d at 1284-85.
35
Id.
36
ECF No. 58-1 at 5.2.
33

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2. Colorado’s Anti-Indemnity Statute precludes applicability of the indemnity
provisions in the Master Service Agreement
U.S. Well maintains that the indemnification provisions of the Master
Service Agreement are void and unenforceable under Colorado’s Anti-Indemnity
Statute. In response, Inflection argues that the Anti-Indemnity Statute is
inapplicable to the Master Service Agreement because it applies only to
construction contracts.
Generally, 13 C.R.S. §13-21-111.5 provides that, “[i]n an action brought as a
result of a death or injury to person or property, no defendant shall be liable for an
amount greater than that represented by the degree or percentage of the negligence
or fault attributable to such defendant that produced the claimed injury . . .” 37
Section 13-21-111.5 allows for the admissibility of evidence of negligence or fault
of a person not a party to the action in order to limit the liability of the defendant
by the degree or percentage of the non-party’s fault.38
In April 2007, Colorado enacted a statute amending §13-21-111.5 by adding
subsection (6), also referred to as the Anti-Indemnity Statute.39 Subsection (6)
generally voids provisions in construction contracts that require a party to
“indemnify, insure, or defend in litigation another person against liability for
damage arising out of death or bodily injury to persons or damage to property
37

13 C.R.S. § 13-21-111.5(1).
13 C.R.S. § 13-21-111.5(3)(a).
39
See Brian G. Eberle, S.B. 07-087 and the Enforceability of Indemnification Provisions in Colorado Construction
Contracts, 36-SEP COLO. LAW. 59 (2007).
38

11

caused by the negligence or fault of the indemnitee or any third party under the
control or supervision of the indemnitee.”40
The Anti-Indemnity Statute was enacted in response to a problematic trend
in construction contracts.41 Construction businesses were using broad indemnity
provision to shift financial responsibility for their negligence to others, which, in
turn, made it more difficult for general contractors to obtain liability insurance.42
The Anti-Indemnity Statute, therefore, prevents a party to a construction agreement
from transferring responsibility of its own negligence to the other party.43
Furthermore, in order to prevent parties from evading the effects of subsection (6)
through choice-of-law provisions applying the law of other states which allow this
practice, the Anti-Indemnity Statute provides that Colorado law applies “to every
construction agreement affecting improvements to real property within the state of
Colorado.”44 The construction agreements to which subsection (6) applies include
Contract[s], subcontract[s], or agreement[s] for materials or labor for
the construction, alteration, renovation, repair, maintenance, design,
planning, supervision, inspection, testing, or observation of any
building, building site, structure, highway, street, roadway bridge,
viaduct, water or sewer system, gas or other distribution system, or
other work dealing with construction or for any moving, demolition,
or excavation connected with such construction.45

40

13 C.R.S. § 13-21-111.5(6)(b).
Eberle, supra note 39 at 60.
42
Id. at 59.
43
Id. at 60.
44
13 C.R.S. § 13-21-111.5(6)(g).
45
13 C.R.S. § 13-21-111.5(6)(e)(I).
41

12

This Court agrees with Inflection that the Anti-Indemnity Statute does not
apply to the matter at hand. Inflection and U.S. Well entered into a contract for the
operation of a drill site in Pennsylvania and not a construction agreement as
defined by the statute. While § 13-21-111.5 applies generally to all civil litigation,
subsection 6 applies only to indemnification clauses in contracts “for materials or
labor for the construction . . . of any building, building site, structure, [etc.].”46 In
fact, at least one court refused to apply the Colorado Ant-Indemnification Statute
to indemnification clauses in Master Service Agreements, even in construction
cases, because the clause was not in the construction agreement itself.47
Curiously, other states have anti-indemnification statutes that could apply to
the situation at hand. The Texas Oilfield Anti-Indemnification Act applies to
contractual agreements relating to oil wells and oilfields.48 Similarly, the Louisiana
Oilfield Indemnity Act applies to contracts “pertaining to wells for oil, gas or
water.”49 Wisconsin also has an anti-indemnification statute which provides that
indemnification clauses in agreements “pertaining to any well for oil, gas or water,
or mine” which indemnify for losses due to death or bodily injury are void when
the negligence is that of the indemnitee.50 Colorado, however, does not have an

46

13 C.R.S. § 13-21-111.5(6)(g).
Higby Crane Service, LLC v. National Helium, LLC, 2015 WL 5692078 (D. Kansas September 28, 2015)
(“Moreover, because the [Colorado] Anti–Indemnification Statute specifically applies to construction agreements,
and not to MSA's, it is not applicable.”).
48
Tex. Civ. Prac. & Rem. Code Ann. § 127.001-007.
49
La. Rev. Stat. Ann. § 9:2780(B).
50
Wyo. Stat. Ann. § 30-1-131.
47

13

anti-indemnification statute pertaining to oil and gas agreements. As the parties
have agreed to apply Colorado law to the Master Service Agreement at hand, the
indemnification provision does not violate Colorado public policy.51
III. U.S. WELL’S MOTION TO DISMISS/MOTION TO STRIKE
A. Standard
Under Federal Rule of Civil Procedure 12(b)(6), a defendant may file a
motion to dismiss for “failure to state a claim upon which relief can be granted.”
Such a motion “tests the legal sufficiency of a pleading” and “streamlines litigation
by dispensing with needless discovery and factfinding.”52 “Rule 12(b)(6)
authorizes a court to dismiss a claim on the basis of a dispositive issue of law.”53
This is true of any claim, “without regard to whether it is based on an outlandish
legal theory or on a close but ultimately unavailing one.”54
Beginning in 2007, the Supreme Court of the United States initiated what
some scholars have termed the Roberts Court’s “civil procedure revival” by
significantly tightening the standard that district courts must apply to 12(b)(6)
motions.55 In two landmark decisions, Bell Atlantic Corporation v. Twombly and
Ashcroft v. Iqbal, the Roberts Court “changed . . . the pleading landscape” by
51

Even if Colorado law was not applied to the matter at hand, there is no anti-indemnification statute under
Pennsylvania law that would be pertinent to the Master Service Agreement in this case.
52
In re Hydrogen Peroxide Litigation, 552 F.3d 305, 316 n.15 (3d Cir. 2008) (Scirica, C.J.) (quoting Szabo v.
Bridgeport Machines, Inc., 249 F.3d 672, 675 (7th Cir. 2001) (Easterbrook, J.)). Neitzke v. Williams, 490 U.S.
319, 326–27 (1989).
53
Neitzke, 490 U.S. at 326 (citing Hishon v. King & Spalding, 467 U. S. 69, 73 (1984)).
54
Neitzke, 490 U.S. at 327.
55
Howard M. Wasserman, The Roberts Court and the Civil Procedure Revival, 31 Rev. Litig. 313 (2012).

14

“signal[ing] to lower-court judges that the stricter approach some had been taking
was appropriate under the Federal Rules.”56 More specifically, the Court in these
two decisions “retired” the lenient “no-set-of-facts test” set forth in Conley v.
Gibson and replaced it with a more exacting “plausibility” standard.57
Accordingly, after Twombly and Iqbal, “[t]o survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as true, to ‘state a claim
to relief that is plausible on its face.’”58 “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.”59 “Although the
plausibility standard does not impose a probability requirement, it does require a
pleading to show more than a sheer possibility that a defendant has acted
unlawfully.”60 Moreover, “[a]sking for plausible grounds . . . calls for enough facts
to raise a reasonable expectation that discovery will reveal evidence of
[wrongdoing].”61
The plausibility determination is “a context-specific task that requires the
reviewing court to draw on its judicial experience and common sense.”62 No matter

56
57

58
59
60

61
62

550 U.S. 544 (2007); 556 U.S. 662, 678 (2009). Wasserman, supra at 319–20.
Iqbal, 556 U.S. at 670 (citing Conley v. Gibson, 355 U.S. 41 (1957)) (“[a]cknowledging that Twombly retired the
Conley no-set-of-facts test”).
Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570).
Iqbal, 556 U.S. at 678.
Connelly v. Lane Const. Corp., 809 F.3d 780, 786 (3d Cir. Jan. 11, 2016) (Jordan, J.) (internal quotations and
citations omitted).
Twombly, 550 U.S. at 556.
Iqbal, 556 U.S. at 679.

15

the context, however, “[w]here a complaint pleads facts that are ‘merely consistent
with’ a defendant’s liability, it ‘stops short of the line between possibility and
plausibility of entitlement to relief.’”63
When disposing of a motion to dismiss, a court must “accept as true all
factual allegations in the complaint and draw all inferences from the facts alleged
in the light most favorable to [the plaintiff].”64 However, “the tenet that a court
must accept as true all of the allegations contained in the complaint is inapplicable
to legal conclusions.”65 “After Iqbal, it is clear that conclusory or ‘bare-bones’
allegations will no longer survive a motion to dismiss.”66 “Threadbare recitals of
the elements of a cause of action, supported by mere conclusory statements, do not
suffice.”67
As a matter of procedure, the United States Court of Appeals for the Third
Circuit has instructed that:
Under the pleading regime established by Twombly and Iqbal, a court
reviewing the sufficiency of a complaint must take three steps. First, it
must tak[e] note of the elements [the] plaintiff must plead to state a
claim. Second, it should identify allegations that, because they are no
more than conclusions, are not entitled to the assumption of truth.
Finally, [w]hen there are well-pleaded factual allegations, [the] court
should assume their veracity and then determine whether they
plausibly give rise to an entitlement to relief.68
63
64
65
66
67
68

Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557 (internal quotations omitted)).
Phillips v. Cnty. of Allegheny, 515 F.3d 224, 228 (3d Cir. 2008) (Nygaard, J.).
Iqbal, 556 U.S. at 678 (internal citations omitted).
Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009) (Nygaard, J.).
Iqbal, 556 U.S. at 678.
Connelly, 809 F.3d at 787 (internal quotations and citations omitted).

16

B. Discussion
1. Motion to Strike
U.S. Well seeks to strike Inflection’s second amended answer69 for failing to
obtain leave of court. It argues that Inflection failed to adhere to Federal Rule of
Civil Procedure 15(a), which provides that amendments must be obtained by leave
of court or written consent of the adverse party.70 Inflection argues that leave of
court was not required in this case because this Court’s Case Management Order
allowed for amendments to pleadings prior to March 15, 2016.
Federal Rule of Civil Procedure 15(a) allows a party to amend its pleading
within twenty-one days of serving it, by obtaining the opposing party’s written
consent to do so, or by leave of court.71 Federal Rule of Civil Procedure 16 further
requires a court to issue a scheduling order that limits the time to join other parties,
complete discovery, file motions, and amend pleadings.72
This Court’s Case Management Order provides a schedule with the time
limits required by Rule 16.73 The second listed date establishes a deadline of March
15, 2016 as “Defendants final date for amending pleadings.”74 This final date to

69

Inflection filed its first answer on April 29, 2015 (ECF 23), which contained no cross-claims against U.S. Well, its
amended answer on September 2, 2015 (ECF No. 41), and its second amended answer on March 9, 2016 (ECF No.
67).
70
Fed. R. Civ. P. 15(a).
71
Id.
72
Fed. R. Civ. P. 16(b)(3)(A).
73
ECF No 55.
74
Id. at 3.

17

amend the pleadings, however, does not give the parties permission to disregard
the requirements of Rule 15(a). Instead, the final date in the Case Management
Order sets a limit on the time that a party can amend its pleading by written
consent of the opposing party. That is to say, the Case Management Order does not
anticipatorily grant a party leave to amend its pleadings. The party must still seek
leave of court.
Be that as it may, the Court will not strike Inflection’s second amended
answer. The Court acknowledges that the Case Management Order does not clearly
or adequately explain the parameters of the time limit with regard to Rule 15(a)
and it notes Inflection’s reasonable, albeit incorrect, interpretation. Furthermore,
had Inflection sought leave of court, it would have been granted as Rule 15(a) also
requires that “court[s] should freely give leave when justice so requires.”75
Inflection filed its second amended answer after U.S. Well filed its third-party
complaint against Hyperion. I would have consequently granted Inflection leave to
amend its answer in light of the changed circumstances.
2. Motion to Dismiss
Alternatively, U.S. Well seeks to dismiss Inflection’s third cross-claim
which seeks a declaratory judgment declaring the parties’ rights and obligations
under the Master Service Agreement. U.S. Well argues that the case is not yet ripe

75

Fed. R. Civ. P. 15(a).

18

for disposition because “Inflection has not demonstrated the necessary immediacy
and reality to warrant the issuance of a declaratory judgment.”76 Inflection, on the
other hand, maintains that the matter is ripe for judicial determination.
In light of this Court’s ruling on Inflection’s motion for partial summary
judgment above, the Court need not rule on the merits of U.S. Well’s ripeness
argument. Inflection seeks a declaratory judgment declaring the rights and
obligations of Inflection and U.S. Well under the Master Service Agreement. As
the rights and obligations have been set forth above, the Court will grant U.S.
Well’s motion and will dismiss Inflection’s cross-claim seeking a declaratory
judgment as moot.
IV. CONCLUSION
In accordance with the foregoing reasoning, Inflection’s motion for partial
summary judgment is granted, U.S. Well’s motion to strike is denied, and U.S.
Well’s motion to dismiss is granted, and Inflection’s cross-claim seeking a
declaratory judgment dismissed as moot.
An appropriate Order follows.
BY THE COURT:
/s Matthew W. Brann
Matthew W. Brann
United States District Judge

76

ECF No. 72 at 4.

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