United States of America f/u/b/o Kogok Corporation v. Travelers Casualty and Surety Company Of America et al

Filing 77

MEMORANDUM OPINION AND ORDER GRANTING THE PLAINTIFFS 62 MOTION TO AMEND THE COMPLAINT, DIRECTING THE PLAINTIFF TO FILE A REFORMULATED AMENDED COMPLAINTAND DEFERRING A RULING ON THE PLAINTIFFS 71 MOTION TO AMEND THE SCHEDULING ORDER. Within ten days of filing its amended complaint, Kogok is DIRECTED to file a reformulated amended complaint. Signed by Senior Judge Frederick P. Stamp, Jr on 4/8/15. (jss)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
UNITED STATES OF AMERICA
f/u/b/o KOGOK CORPORATION,
Plaintiff,
v.

Civil Action No. 1:13CV240
(STAMP)

TRAVELERS CASUALTY AND SURETY
COMPANY OF AMERICA,
FEDERAL INSURANCE COMPANY,
FIDELITY & DEPOSIT COMPANY
OF MARYLAND,
ZURICH AMERICAN INSURANCE COMPANY,
LIBERTY MUTUAL INSURANCE COMPANY
and THE CONTINENTAL INSURANCE COMPANY,
Defendants.
MEMORANDUM OPINION AND ORDER
GRANTING THE PLAINTIFF’S MOTION TO AMEND THE COMPLAINT,
DIRECTING THE PLAINTIFF TO FILE A REFORMULATED AMENDED COMPLAINT
AND DEFERRING A RULING ON THE PLAINTIFF’S MOTION
TO AMEND THE SCHEDULING ORDER
I.
The

plaintiff,

Background1

United

States

of

America

f/u/b/o

Kogok

Corporation (“Kogok”), filed this action against the defendants
(“the sureties”) pursuant to the Miller Act, 40 U.S.C. § 3133, to
recover payment for labor and materials it rendered to the Federal
Bureau of Investigation’s (“FBI”) Biometric Technology Center, New
Office

Building

“project”)

1

and

located

Central
in

Utilities

Clarksburg,

Plant

West

Expansion

Virginia.

(the

Turner

For a more thorough factual summary of this civil action, see
this Court’s prior memorandum opinion and order granting the
sureties’ partial motion for summary judgment. ECF No. 61.

Construction

Company

(“Turner”)

and

the

FBI

entered

into

a

construction contract, in which Turner agreed to construct the
project.

Turner then entered into a subcontract agreement with

Bell Constructors, LLC (“Bell”), in which Bell agreed to perform
the mechanical work on the project.

Next, Bell entered into a

separate subcontract agreement with Kogok, in which Kogok agreed to
provide sheet metal, ductwork, and related services for the project
for the price of $3.22 million. The sureties issued a payment bond
on behalf of Turner, the general contractor, for the project.
Kogok

seeks

recovery

from

the

sureties

in

the

amount

of

$1,920,177.02, asserting that it is entitled to payment of this sum
under the payment bond and the Miller Act.
Previously, the sureties filed a motion for partial summary
judgment and to stay all proceedings, seeking summary judgment
against Kogok with respect to: (1) all claims that arose on or
before October 31, 2013; (2) Kogok’s claims for damages for delay;
and (3) Kogok’s claim for damages allegedly resulting from labor
inefficiency.
this

granted

the

In its memorandum opinion and order,
partial

summary

judgment but denied their motion to stay all proceedings.

ECF No.

61.

Court

ECF No. 28.

sureties’

motion

for

At issue now is Kogok’s motion to file an amended complaint

and motion to amend the scheduling order.
respectively.

ECF Nos. 62 and 70,

Those two motions are discussed below in the order

presented.

2

A.

Motion to File an Amended Complaint
In its motion to amend the complaint, Kogok claims that in

light of this Court’s memorandum opinion and order, amendments need
to be made to the complaint.

Specifically, Kogok seeks to add six

counts against Bell, which include breach of contact claims and
equitable claims.

Kogok also asserts that the proposed additions

are neither futile nor made in bad faith.

In addition to those new

counts, Kogok wishes to update the total amount of damages it seeks
against the sureties and now Bell.

Kogok also contends that the

sureties will not be prejudiced by those additions, pointing out
that the sureties and Bell knew about the underlying facts of the
proposed amended complaint. For those reasons, Kogok requests that
it have the opportunity to file an amended the complaint.
The sureties then filed a response in opposition. ECF No. 63.
In that response, the sureties claim that Kogok seeks to do more
than add claims against Bell.

Instead, the sureties assert that

Kogok is attempting to re-assert its previous claims so as to
revive

claims

that

were

previously

ruled

on

by

this

Court.

Further, the sureties argue that the proposed amended complaint
would not withstand either a motion to dismiss or motion for
summary judgment.

For those reasons, the sureties claim that this

Court should deny Kogok’s motion.
support of its motion.

ECF No. 66.

Kogok then filed a reply in
In that reply, Kogok claims

that it is not attempting to revive already dismissed claims or

3

allegations.

Rather, Kogok contends that the already ruled on

claims are being reasserted in order to preserve those claims in
case Kogok decides to appeal or file a motion to reconsider. Kogok
also argues that the amended complaint provides updated damages
against the sureties, and that the amended complaint complies with
the liberality rule under Rule 15 of the Federal Rules of Civil
Procedure (“Rule 15”).

For those reasons, Kogok believes that it

should be allowed to file an amended complaint.
B.

Motion to Amend the Scheduling Order
In its motion to amend the scheduling order, Kogok requests

that this Court modify certain deadlines, primarily referring to
the discovery deadline.

Kogok contends that the sureties and Bell

have not been forthcoming with certain documents.

Further, the

FBI, as owners of the project, required Kogok and its scanning
vendors to receive security clearance.

In addition to that delay,

Kogok claims that counsel for Bell allegedly declined certain
requests for the documents.

Due to the above delays, Kogok

believes it may need additional time for discovery, which will
affect the current scheduling order.

Kogok also points out that

its motion to amend the complaint remains pending.

If the Court

grants its motion to amend the complaint, the civil action will now
include

Bell.

Thus,

Kogok

believes

that

adding

Bell

as

additional party will likely require additional discovery.

an
For

those reasons, Kogok requests that the scheduling order be amended.

4

The sureties filed a response in opposition. ECF No. 73. The
sureties argue that Kogok had opportunities to seek FBI clearance
and to view the documents since September 2014. The sureties point
to the protective order (ECF No. 60), which allegedly satisfied any
security needs that the FBI required.

Despite that, the sureties

assert that Kogok waited until the end of the discovery period to
arrange for the inspection of the documents.

Next, the sureties

argue that this Court’s order granting partial summary judgment
resulted in a waiver of all of Kogok’s claims arising before
October 31, 2014. Because of that, the sureties argue that even if
Kogok includes Bell in its amended complaint, the claims that it
may assert against those parties are so narrow that no extension of
discovery is needed.

Kogok later filed a reply.

ECF No. 76.

Kogok argues that although it bears some responsibility for the
delays in discovery, other factors contributed to that delay.
Kogok then reasserts that its additional claims against Bell will
likely warrant additional discovery.

Finally, Kogok contends that

the sureties will face no prejudice if this Court amends the
scheduling order.

Because of that, Kogok believes this Court

should grant its motion.
For the reasons set forth below, Kogok’s motion to file an
amended complaint is granted, but as framed.

Further, this Court

defers ruling on Kogok’s motion to amend the scheduling order.

5

II.
Federal

Rule

of

Applicable Law

Civil

Procedure

15(a)(1)(A)

states,

in

pertinent part, that “[a] party may amend its pleading once as a
matter of course . . . before being served with a responsive
pleading.”

If a party seeks to amend its pleadings in all other

cases, it may only do so “with the opposing party’s written consent
or the court’s leave.
justice so requires.”
Rule

15(a)

The court should freely give leave when
Fed. R. Civ. P. 15(a)(2).

grants

the

district

court

broad

discretion

concerning motions to amend pleadings, and leave should be granted
absent some reason “such as undue delay, bad faith, or dilatory
motive

on

the

part

of

the

movant,

repeated

failure

to

cure

deficiencies by amendments previously allowed, undue prejudice to
the opposing party by virtue of allowance of the amendment or
futility of the amendment.”

Foman v. Davis, 371 U.S. 178, 182

(1962); see also Ruotolo v. City of N.Y., 514 F.3d 184, 191 (2d
Cir. 2007); In re Tamoxifen Citrate Antitrust Litig., 429 F.3d 370,
404 (2d Cir. 2005); Ward Elec. Serv. v. First Commercial Bank, 819
F.2d 496, 497 (4th Cir. 1987); Gladhill v. Gen. Motors Corp., 743
F.2d 1049, 1052 (4th Cir. 1984).
III.

Discussion

As discussed earlier, Kogok’s motion to file an amended
complaint

and

its

motion

to

amend

6

the

scheduling

order

are

currently at issue.

Those two motions are discussed below in the

order presented.
A.

Motion to File an Amended Complaint
In its motion to file an amended complaint, Kogok seeks to

assert six new counts against Bell, as well as re-plead the six
prior counts against the sureties.

The sureties oppose Kogok’s

motion, claiming that Kogok is attempting to revive claims against
the sureties that were previously ruled on by this Court.

Kogok,

however, argues that its intentions have been misconstrued. Rather
than revive previously ruled upon claims, Kogok claims that it
included Counts I through VI in order to preserve them for purpose
of filing an appeal or a motion for reconsideration. In support of
its argument, Kogok cites Young v. City of Mount Ranier, 238 F.3d
567 (4th Cir. 2001), arguing that it must comply with the “repleading rule” as articulated in Young.

Further, Kogok points out

that the amended complaint provides updated damages. Regarding its
newly asserted claims against Bell, listed under Counts VII through
XII,2 Kogok contends that Bell was well aware that Kogok would
potentially file claims against it. To that argument, Kogok points
to the nature of the new claims, which are breach of contract and
equitable claims, and to Bell’s involvement in this civil action.
Further, because Rule 15 arguably provides generous opportunities

2

It should be noted that in its proposed amended complaint,
Kogok has two counts labeled as “Count XI.” This Court interprets
the second one labeled as such to be actually titled “Count XII.”
7

to file an amended complaint, Kogok argues that it should be
afforded such an opportunity.
This Court agrees that Kogok should be permitted to file an
amended

complaint.

As

indicated

earlier,

“[d]istrict

courts

‘ha[ve] broad discretion to decide whether to grant leave to
amend.’”

Kant, 2010 WL 807442, at *4 (quoting In re Tamoxifen

Citrate Antitrust Litig., 429 F.3d 370, 404 (2d Cir. 2005)).
Although leave to amend the complaint should be liberally granted,
situations exist where such an opportunity should be denied.
Ruotolo v. City of New York, 514 F.3d 184, 191 (2d Cir. 2007).
Those situations include “undue delay, bad faith or dilatory motive
on the part of the movant, repeated failure to cure deficiencies by
amendments previously allowed, undue prejudice to the opposing
party by virtue of allowance of the amendment, futility of the
amendment, etc.”
comparing

the

Foman v. Davis, 371 U.S. 178, 182 (1962).

current

complaint

and

Kogok’s

proposed

After

amended

complaint, Kogok seeks to add six new counts pertaining to Bell, as
well as six prior counts against the sureties.

Kogok repeatedly

states, however, that it does not seek to revive those prior counts
against

the

sureties.

This

Court

will

take

Kogok’s

stated

intention at face value, and thus permit it to file its amended
complaint.
However, Kogok’s reliance upon Young v. City of Mount Ranier,
238 F.3d 567 (4th Cir. 2001), is somewhat misplaced.

8

Kogok cites

to Young for the proposition that failure to re-plead its claims
that were ruled on by this Court may result in waiving those claims
for purposes of either an appeal or motion to reconsider.
66 at *3.

ECF No.

Because the re-pleading rule, as articulated in Young,

may apply, Kogok believes it must re-plead Counts I through VI
against

the

sureties,

to

the

extent

previously ruled on by this Court.

that

those

counts

were

In Young, the United States

Court of Appeals for the Fourth Circuit found that “if a claim is
dismissed without leave to amend, the plaintiff does not forfeit
the right to challenge the dismissal on appeal simply by filing an
amended complaint that does not re-allege the dismissed claim.”
238 F.3d at 572-73. Regarding those claims that this Court already
ruled on, Kogok was not provided leave to amend.

The exception to

the general rule of waiver adopted in Young applies, thus making it
technically unnecessary for Kogok to re-plead its claims under
Counts I through VI.

Nonetheless, out of an extreme abundance of

caution, this Court will permit Kogok to file an amended complaint
with those previous claims included but subject to the obligation
to file a reformulated amended complaint as set forth below.
The sureties stress the futility of the new counts under the
amended complaint, where they allege that those new counts cannot
withstand

either

a

motion

to

dismiss

or

motion

for

summary

judgment.

“A proposed amendment is futile if the amendment could

not withstand a Rule 12(b)(6) motion to dismiss.” Rose v. Hartford

9

Underwriters Ins. Co., 203 F.3d 417, 420 (6th Cir. 2000) (citing
Thiokol Corp. v. Dep’t of Treasury, State of Mich., Rev. Div., 987
F.2d 376, 382-83 (6th Cir. 1993)); see also Marucci Sports, L.L.C.
v. Nat’l Collegiate Athletic Ass’n, 751 F.3d 368 (5th Cir. 2014);
Everett v. Prison Health Services, 412 F. App’x 604, 606 (4th Cir.
2011) (“Where a proposed amendment is made beyond the statute of
limitations and it would not relate back to the original complaint,
such an amendment would be futile.”); Dougherty v. Town of North
Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 88 (2d Cir. 2002).
Based

on

that

standard,

courts

“review

the

proposed

amended

complaint under ‘the same standard of legal sufficiency as applies
under Rule 12(b)(6).’”

Marucci Sports, L.L.C., 751 F.3d at 378

(quoting Stripling v. Jordan Prod. Co., L.L.C., 234 F.3d 863, 873
(5th Cir. 2000)).
After

analyzing

Kogok’s

proposed

amended

complaint,

the

additional counts against Bell are legally sufficient to state a
claim.

The proposed amended complaint provides sufficient factual

information so as to state the breach of contract claims, as well
as the equitable claims that Kogok asserts.

In particular, Kogok

describes its relationship with Bell in more detail, and also
states the alleged conduct of Bell that may establish a breach of
contract.

Those claims are at least colorable, and they appear to

state a claim upon which relief may be granted.

10

Therefore,

pursuant to the discretion that this Court possesses, Kogok should
be afforded an opportunity to file an amended complaint.
In addition to filing an amended complaint, however, Kogok
must also file a “reformulated amended complaint.”

See, e.g.,

Stinnet v. Brooks Kushman, P.C., 2011 WL 672230, at *2 (E.D. Mich.
Feb. 17, 2011).

As noted, Kogok claims that it seeks to file an

amended complaint so as to preserve certain claims for potential
appeal and reconsideration purposes, as well as to assert new
claims against Bell.

For those purposes, this Court permits Kogok

to file an amended complaint.

In order to clarify the remaining

claims and allegations, however, Kogok must file a reformulated
amended

complaint

that

reflects

this

Court’s

prior

rulings,

including but not limited to its ruling on the sureties’ motion for
partial summary judgment.

Specifically, the reformulated amended

complaint shall eliminate all claims that have been previously
dismissed to provide a clearer picture as to what remains.

Kogok

must file that reformulated amended complaint within ten days of
filing its amended complaint.3

If the parties wish to file any

motions as to Kogok’s claims, they should do so with regard to the
reformulated amended complaint, rather than the amended complaint.

3

There is no need to effect service of the amended complaint
upon defendant Bell. Rather, Kogok shall effect service of the
reformulated amended complaint upon Bell in the manner provided by
Rule 4 of the Federal Rules of Civil Procedure.
11

The amended complaint, although ordered filed, will not be further
considered in this civil action.
B.

Motion to Amend the Scheduling Order
As discussed earlier, Kogok also filed a motion to amend the

scheduling order.

ECF No. 71.

This Court notes that as to the

initial complaint filed in this civil action, Kogok appears to be
dilatory in seeking a modified scheduling order.

Further, the

motion to amend the scheduling order was filed prematurely, because
this Court had not yet acted on Kogok’s motion to amend the
complaint.

Nonetheless, because this Court is granting Kogok’s

motion to amend its complaint and directing Kogok to file a
reformulated amended complaint, an amended scheduling order may be
necessary.

This Court, however, will defer ruling on Kogok’s

motion to amend the scheduling order.

Instead, the parties to the

reformulated amended complaint are directed to meet and confer
about any proposed amendments to the scheduling order.

Following

that meeting, the parties will contact the Court with their
requested amendments and modifications to the scheduling order.
This Court will then decide what action, if any, is necessary.
IV.

Conclusion

For the reasons set forth above, Kogok’s motion to amend the
complaint (ECF No. 62) is GRANTED.

Within ten days of filing its

amended complaint, Kogok is DIRECTED to file a reformulated amended
complaint, as earlier described in this memorandum opinion and
12

order. Finally, a ruling on Kogok’s motion to amend the scheduling
order (ECF No. 71) is DEFERRED until the parties contact this Court
after meeting and conferring about any modifications that may be
deemed necessary.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein.
DATED:

April 8, 2015

/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE

13