Elliott et al v. AAA Insurance
Filing
21
MEMORANDUM OPINION AND ORDER GRANTING PLAINTIFFS' 17 MOTION TO FILE AN AMENDED COMPLAINT, DENYING WITHOUT PREJUDICE DEFENDANT'S 2 MOTION TO DISMISS, OR ALTERNATIVELY, TO STAY, DIRECTING PLAINTIFFS TO FILE AN AMENDED COMPLAINT AND DIR ECTING THE CLERK TO STRIKE THE IMPROPERLY FILED AMENDED COMPLAINT. Plaintiffs are DIRECTED to file an amended complaint, and the Clerk is DIRECTED to strike the incorrectly filed docket entry, titled Amended Complaint (ECF No. 15). Signed by Senior Judge Frederick P. Stamp, Jr. on 3/10/16. (copy to counsel via CM/ECF)(lmm)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
GLENN F. ELLIOTT and
VIVIAN E. ELLIOTT,
his wife,
Plaintiffs,
v.
Civil Action No. 5:15CV146
(STAMP)
AAA INSURANCE,
Defendant.
MEMORANDUM OPINION AND ORDER
GRANTING PLAINTIFFS’ MOTION
TO FILE AN AMENDED COMPLAINT,
DENYING WITHOUT PREJUDICE DEFENDANT’S
MOTION TO DISMISS, OR ALTERNATIVELY, TO STAY,
DIRECTING PLAINTIFFS TO FILE AN AMENDED COMPLAINT
AND DIRECTING THE CLERK TO STRIKE
THE IMPROPERLY FILED AMENDED COMPLAINT
I.
Background
The plaintiffs initially filed this civil action in the
Circuit Court of Marshall County, West Virginia.
According
to
their
complaint,
the
ECF No. 1 Ex. 1.
plaintiffs
underinsured motorist policy from the defendant.
purchased
an
Later, in 2011,
plaintiff Glenn F. Elliott was involved in a serious car accident.
The insurance carrier for the tortfeasor involved in that car
accident paid its limits of liability coverage. The payment by the
tortfeasor’s insurance carrier was allegedly inadequate as to
making the plaintiffs whole.
Therefore, they filed an action in
state court against the defendant, who is their insurer.
plaintiffs
allege
that
the
defendant
harassed
the
The
plaintiffs
throughout the state court action.
That action ultimately settled
prior to trial. However, the plaintiffs claim that a dispute arose
as to the release language of the settlement.
More specifically,
the plaintiffs claim that the defendant sought a release of all
claims
that
could
be
potentially
brought
against
it.
The
plaintiffs believe that the defendant’s insistence on such a
release violates West Virginia law.
Therefore, they seek not only
enforcement of the settlement agreement, but also seek compensatory
damages under what appears to be claims pursuant to the West
Virginia Unfair Trade Practices Act (“UTPA”) and Hayseeds, Inc. v.
State Farm Fire & Cas., 352 S.E.2d 73 (W. Va. 1986).
then removed this civil action.
The defendant
ECF No. 1.
The defendant has since filed a motion to dismiss, or in the
alternative, motion to stay.
ECF No. 2.
This Court scheduled a
status and scheduling conference as to the defendant’s motion. ECF
No. 4.
After entering that order but before the conference, the
plaintiffs filed a motion to remand, to which the defendant
responded.
ECF Nos. 6 and 7.
The plaintiffs did not file a reply.
This Court heard from both parties as to the pending motions at the
status and scheduling conference.
Based on the record before it,
this Court ordered that the briefing schedule for the motion to
dismiss be stayed until this Court ruled on the plaintiffs’ motion
to remand.
ECF No. 10.
Ultimately, this Court denied the
2
plaintiffs’ motion to remand, and lifted the stay as to the
briefing of the motion to dismiss.
At issue now are the defendant’s motion to dismiss, or
alternatively, to stay, and the plaintiffs’ motion to file an
amended complaint.
In its motion to dismiss, the defendant first
asserts that the plaintiffs’ extra-contractual claims under UTPA
are barred by the statute of limitations.
As to the claim for
enforcement of the settlement agreement, the defendant notes that
the plaintiffs filed a pending claim in Ohio state court, in which
the plaintiffs seek the proceeds of the underinsured motorist
coverage policy.
The defendant alternatively requests that this
civil action be stayed pending resolution of the Ohio action.
The
plaintiffs filed a response in opposition. In their response, they
first argue that the statute of limitations has not expired,
because the conduct related to the claim persists.
Moreover, the
plaintiffs believe that they have adequately pleaded all of their
claims under the complaint.
As to the request to stay, the
plaintiffs contend that the UTPA claims under West Virginia law
must be decided before the Ohio court can properly rule on the
claims
before
reasserts
its
it.
The
initial
defendant
arguments
filed
and
a
reply,
also
argues
wherein
it
that
the
plaintiffs’ response is untimely.
The
plaintiffs
complaint.
then
filed
a
motion
to
file
an
amended
In their motion, the plaintiffs seek to clarify their
3
claims and theories of liability.
Moreover, the plaintiffs point
out that they are making their request to amend in the early stages
of this civil action.
Therefore, the plaintiff’s believe that the
defendant will face little, if any, prejudice. The plaintiffs also
point out that they sought the consent of the defendant to amend,
but such consent was not given.
The defendant filed a response in
opposition, wherein it asserts that the motion to amend is both
futile and made in bad faith.
No reply was filed.
For the reasons set forth below, the plaintiffs’ motion to
file an amended complaint is GRANTED, and the defendant’s motion to
dismiss, or alternatively, to stay is DENIED WITHOUT PREJUDICE.
Further, the plaintiffs are DIRECTED to file the amended complaint,
and the Clerk is DIRECTED to strike the improperly filed docket
entry, titled “Amended Complaint” (ECF No. 15).1
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
1
The plaintiffs point out that the docket entry titled
“Amended Complaint” (ECF No. 15) should not have been filed. They
attribute that improper filing to an “internal office error.” ECF
No. 17.
4
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 stated above, the following motions are at issue: (1) the
plaintiffs’ motion to file an amended complaint, and (2) the
defendant’s motion to dismiss, or alternatively, to stay.
Those
motions are discussed below in the order presented.
A.
Plaintiffs’ Motion to File an Amended Complaint
The plaintiffs indicate that they wish to clarify the nature
of their claims and theories of liability.
The defendant argues
that the plaintiffs’ proposed amendments are both made in bad faith
and futile.
However, a comparison of the previous, unamended
5
complaint and the proposed amended complaint show that, on its
face, neither bad faith nor futility are present.
As to the assertion of bad faith, the defendant has not
adequately shown such conduct by the plaintiffs.
Bad faith on the
part of the movant requires an “affirmative demonstration by the
non-moving party.” Roller Bearing Co. of America, Inc. v. American
Software, Inc., 570 F. Supp. 2d 376, 384 (D. Conn. 2008) (citing
Monahan v. New York City Dep’t of Corr., 214 F.3d 275, 283-84 (2d
Cir. 2000)).
Here, the defendant contends that the plaintiffs’
proposed amendments are an attempt to avoid application of the
relevant statute of limitations.
is
insufficient
to
That accusation, standing alone,
demonstrate
the
contemplated in the context of Rule 15.
as to futility also falls short.
standard
of
“bad
faith”
The defendant’s argument
“A proposed amendment is futile
if it serves no legitimate purpose or is without legal merit.”
Savoy v. White, 139 F.R.D. 265, 267 (D. Mass. 1991) (citing Liberty
Leather Corp. v. Callum, 653 F.2d 694, 700 (1st Cir. 1981)).
Phrased another way, “[a] district court may also deny leave to
amend when the proposed amendment would be futile—that is, when it
could not survive a Rule 12(b)(6) motion to dismiss.”
American
Software, Inc., 570 F. Supp. 2d at 385 (citing Dougherty v. Town of
North Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 88 (2d Cir.
2002)).
The plaintiffs’ proposed amendments do serve a legitimate
purpose, which in this case are to clarify the claims asserted
6
against the defendant. Further, the plaintiffs correctly point out
that their motion to file an amended complaint has been made in the
early stages of this civil action, which cuts against any argument
of prejudice to the defendant.
See Scott v. Family Dollar Stores,
Inc., 733 F.3d 105, 118-19 (4th Cir. 2013) (quoting Johnson v.
Oroweat Foods Co., 785 F.2d 503, 510 (4th Cir. 1986) (noting that
the “basis for a finding of prejudice essentially applies where the
amendment is offered shortly before or during trial”).
Based on
the grounds discussed above, the plaintiffs’ motion to file an
amended complaint is GRANTED.
B.
Defendant’s Motion to Dismiss, or Alternatively, to Stay
As indicated above, defendant filed a motion to dismiss, or
alternatively,
to
stay.
However,
that
plaintiffs’ previous, unamended complaint.
motion
concerned
the
Because this Court has
granted the plaintiffs’ motion to file an amended complaint, it is
unnecessary to rule on the merits of the defendant’s motion to
dismiss,
which
applies
to
the
previous,
unamended
complaint.
Therefore, the defendant’s motion to dismiss, or alternatively, to
stay is DENIED WITHOUT PREJUDICE.
IV.
Conclusion
For the reasons set forth above, the plaintiffs’ motion to
file an amended complaint is GRANTED, and the defendant’s motion to
dismiss, or alternatively, to stay is DENIED WITHOUT PREJUDICE.
Accordingly,
the
plaintiffs
are
7
DIRECTED
to
file
an
amended
complaint, and the Clerk is DIRECTED to strike the incorrectly
filed docket entry, titled “Amended Complaint” (ECF No. 15).
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein.
DATED:
March 10, 2016
/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE
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