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Vista Engineering Technologies, LLC v. Premier Technology

May 24, 2010

VISTA ENGINEERING TECHNOLOGIES, LLC, A CALIFORNIA CORPORATION, PLAINTIFF/COUNTERDEFENDANT,
v.
PREMIER TECHNOLOGY, INC, AN IDAHO CORPORATION, DEFENDANT/COUNTERCLAIMANT.



The opinion of the court was delivered by: Honorable B. Lynn Winmill Chief U. S. District Judge

MEMORANDUM DECISION AND ORDER

INTRODUCTION

The Court has before it the Motion to Strike Defendant's Amended Defenses and Counterclaims filed by Vista (Docket No. 75). The motion is fully briefed and at issue. For the reasons expressed below, the motion to amend is granted in part and denied in part.

LITIGATION BACKGROUND

This is a breach of contract action by Vista to recover payments allegedly due from Premier for engineering services. Premier denies that it owes Vista any additional payments and has asserted counterclaims arising out of Vista's alleged failure to provide deliverables acceptable to Premier's customer.

On January 20, 2010, the Court granted Vista's motion to amend its original complaint to add punitive damages (Docket No. 64), and Vista filed an Amended Complaint on January 21, 2010 (Docket No. 66). Premier filed its Amended Answer to the Amended Complaint and Counterclaim, on February 4, 2010 (Docket No. 73), 8 months after the June 4, 2009 deadline set in the case management order for filing amending pleadings (Docket No. 12).

In its amended pleading, Premier added five new affirmative defenses, including fault of undisclosed non-parties, statute of frauds, parol evidence, failure of consideration, and accord and satisfaction. In addition, Premier inserted a new allegation in its counterclaim that "Vista had an implied contractual duty to exercise the standard of care and perform the work with the required competency of other engineers in their field," and Vista breached this duty. See Counterclaim at ¶¶ 24 & 25.

ANALYSIS

Vista complains that Premier impermissibly added in its amended pleading the five new affirmative defenses and the new theory alleging Vista failed to perform to the level of other engineers in its field. Vista asks the Court to strike Premier's amendments because (1) Premier had no right to amend its answer and counterclaim without first obtaining leave of court; and (2) the amendments are untimely and prejudicial. Vista argues it did not open the door for Premier to assert new claims and defenses by amending its complaint to add punitive damages.

Premier responds that Vista's amended complaint changed the scope of the litigation, which permitted Premier "to plead anew as though it were the original complaint filed by the plaintiff." See Defendant's Response Brief at 4 (citing DBSI v. Greensboro, No. CV 05-051-SLMB, 2006 WL 1275394, *6 (D. Idaho May 9, 2006)).

A defendant may file an amended response without leave "only when the amended complaint changes the theory or scope of the case, and then, the breadth of the changes in the amended response must reflect the breadth of the changes in the amended complaint." St. Paul Fire and Marine Ins. Co. v. Onvia, Inc., 2007 WL 1575955, *1 (W.D. Wash. May 29, 2007) (citing Akzenta Paneele Profile GmbH v. Unilin Flooring N.C. LLC, 464 F. Supp.2d 481, 486 (D. Md. 2006). See also DBSI v. Greensboro, No. CV 05-051-SLMB, 2006 WL 1275394, *6 (D. Idaho May 9, 2006).*fn1 "The obvious corollary is that if an amended complaint does not change the theory or scope of the case, a [defendant] must seek leave of court pursuant to Rule 15(a) before it can amend its answer to assert a counterclaim." Tralon Corp. v. Cedarapids, Inc., 966 F. Supp. 812, 832 (N.D. Iowa 1997).

In this case, Vista's amendment added a prayer for punitive damages related to its original breach of contract claim. But it did not change the basic theory of its case, or expand the scope of its claims. See, e.g., Vendelin v. Costco Wholesale Corp., 140 Idaho 416, 426, 95 P.3d 34, 44 (Idaho 2004) ("The amended complaint added a prayer for punitive damages only"). Vista requested compensatory damages at the outset of this case, and it merely seeks to add an additional form of damages following a favorable verdict at trial. Premier "was not forced to respond to an entirely new cause of action or theory of recovery." Vendelin, 140 Idaho at 426, 95 P.3d at 44. Premier therefore was not allowed to amend its answer and counterclaim as a matter of right. This, however, does not mean that Premier's newly asserted allegations and affirmative defenses necessarily must be stricken.

1. Breach of Contract Allegations

Premier contends that its new allegation that Vista was required to perform under the contract in conformance with industry standards should not be stricken because Premier's original counterclaim provided sufficient notice to Vista. According to Premier, the new allegation merely "adds specificity and clarity" to its existing claims. See Defendant's Response at 11(Docket No. 81). The Court agrees. Federal Rule of Civil Procedure 8(a) did not require Premier to recite every term of the contract Vista allegedly breached in it is original counterclaim. Rather, a "short and plain statement of the claim" suffices under the rule. Fed.R.Civ.P. 8(a). Here, Premier alleged in its original counterclaim (1) the existence of a contract; (2) its own performance (3) Vista's breach, and (4) resulting damage to Premier. This is enough. See, e.g., ...


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