Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Sean Michael Swendsen, Individually As A Remainder Beneficiary v. Richard I. Corey

February 13, 2012

SEAN MICHAEL SWENDSEN, INDIVIDUALLY AS A REMAINDER BENEFICIARY
OF AND DERIVATIVELY ON BEHALF OF THE RICHARD I. SWENDSEN TRUST,
PLAINTIFF,
v.
RICHARD I. COREY, TRUSTEE OF THE RICHARD I. SWENDSEN TRUST; AND
CLAYNE I. COREY, AN INDIVIDUAL IN POSSESSION OF ASSETS OF THE RICHARD I. SWENDSEN TRUST AND ACCOUNTANT AND ATTORNEY TO THE TRUST AND TRUSTEE, DEFENDANTS.



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

MEMORANDUM DECISION AND ORDER

INTRODUCTION

The Court has before it Defendant's Motion to Amend the Answer of Richard I. Corey to Plaintiff's Amended Complaint (Dkt. 119) and Defendant Richard Corey's Motion in Limine Re: Plaintiff's Expert Russell Johnson (Dkt. 120).

ANALYSIS

1. Motion to Amend

Plaintiff filed his original Complaint in this case on May 14, 2009. The Court granted Plaintiff leave to file an Amended Complaint on July 1, 2010. The Court also extended the discovery cutoff, dispositive motion deadline, and expert disclosure deadlines in light of the Amended Complaint. No trial date had been set at that time. The Court then extended deadlines again pursuant to a stipulation by the parties. The case progressed with dispositive motions and mediation, but the case was not resolved. On October 5, 2011, the Court set the case for trial to commence on February 27, 2012. With the agreement of counsel, the Court moved the trial up three days to February 24, 2012. Now, approximately one month before trial, Defendant Richard Corey asks to amend his Answer to add additional affirmative defenses.

As the Court noted when it addressed Plaintiff's motion to amend his complaint, Rule 15(a) is a liberal standard and leave to amend "shall be freely given when justice so requires." Leadsinger, Inc. v. BMG Music Pub., 512 F.3d 522, 532 (9th Cir. 2008). However, the district court has discretion in deciding whether to grant leave to amend, taking into consideration whether there has been "undue delay, bad faith or dilatory motive . . . , repeated failure to cure deficiencies by amendments previously allowed, undue prejudice . . ., [and] futility of amendment." Id., (citing Foman v. Davis, 371 U.S. 178, 182 (1962)). Prejudice is the most important factor to consider in this analysis. Jackson v. Bank of Hawaii, 902 F.2d 1385, 1387 (9th Cir. 1990)(citation omitted). In Jackson, the Ninth Circuit found undue prejudice where proposed amendments added claims that raised new legal theories. Id. at 1388.

Moreover, although not explicitly stated in the Court's earlier order, the Court must also consider the good cause standard under Rule 16(b)(4) when an amendment requires extension of deadlines in a Case Management Order. It is worth noting that when the Court addressed Swendsen's motion to amend the Complaint, no trial date had been set, and the case was in a posture where extending those deadlines could be done without delaying the trial or causing prejudice to either party.

Defendant Richard Corey now wants to amend his Answer to add three affirmative defenses: (1) Richard Corey is not liable based on release, waiver, estoppel, prevention of performance, accord and satisfaction, acquiescence, ratification, approval, and consent; (2) Swendsen's claims are barred by the statue of limitations; and (3) Swendsen lacks standing. Proposed Amended Answer, pp.33-34, Dkt. 121-3. The defenses are asserted respectively as the tenth, eleventh and twelfth affirmative defenses of the proposed Amended Answer. Id.

Richard Corey asserts that the tenth affirmative defense (more accurately a set of affirmative defenses listed under one heading) is warranted because Swendsen and former co-defendant Clayne Corey recently settled Swendsen's claims against Clayne Corey by stipulation. Richard Corey states that "to the extent that the Stipulation has now released Clayne I. Corey from any liability, and fully resolves all issues as between Plaintiff and Defendant Clayne I. Corey, it raises defenses that Defendant Richard Corey requests leave to amend his Answer to assert as affirmative defenses as to that event: release, waiver, estoppel, accord and satisfaction, acquiescence, ratification, approval and consent." Memorandum Supporting Defendnat Richard Corey's Motion to Amend, p.4, Dkt. 119-1. Richard Corey makes a somewhat generic statement that because Swendsen settled duplicitous claims against Clayne Corey, "new issues subject to defenses not previously pleaded" are present. Id.

Without more explanation, the Court cannot understand why the settlement between Clayne Corey and Swendsen raises new issues subject to the defenses asserted in the tenth affirmative defense. The Court does not understand why Richard Corey could not have asserted the defenses of release, waiver, estoppel, accord and satisfaction, acquiescence, ratification, approval and consent before Swendsen settled his claims against Clayne Corey. He gives no legal authority as to why settlement with a co-defendant creates these affirmative defenses. Thus, Richard Corey has not met the Rule 16(b) requirement. The amendment of pleadings deadline expired a long time ago. A tardy motion to amend must satisfy the more stringent "good cause" showing required under Rule 16 before subjecting the motion to the limited constraints for leave to amend under Rule 15(a). AmerisourceBergen Corp. v. Dialysist West, Inc., 465 F.3d 946, 952 (9th Cir. 2006). Settlement of co-defendant Clayne Corey's claims is not good cause.

Moreover, Swendsen and his counsel would be prejudiced at this point by being required to investigate these new defenses instead of preparing for trial in the few weeks left before trial. Thus, the Rule 15(a) standard is not met either.

Richard Corey also has not met his burden with respect to the eleventh affirmative defense -- the statute of limitations. He states that the issue is not new to the case, noting that the Court earlier denied Defendant Clayne Corey's motion for partial summary judgment, leaving the statute of limitations issue for the jury. (Dkt. 90). He explains that he joined in that motion for partial summary judgment, so Swendsen cannot claim surprise or prejudice at this point.

In response to Clayne Corey's motion for summary judgment, Richard Corey filed a one-paragraph document stating that he joined the arguments asserted by Clayne Corey "to the extent they apply to all the claims against Richard Corey." Richard I. Corey's Joinder, p.1, Dkt. 76. With respect to the statute of limitations argument, the parties and the Court addressed its application to Clayne Corey's claims, not Richard Corey's claims. Richard Corey does not explain why the arguments would be the same. Moreover, Richard Corey suggests that Swendsen asserted the claims in a way to avoid application of the statute of limitations to the other beneficiaries. If that is true, Richard Corey should have asserted the statute of limitations affirmative defense when the Amended Complaint was filed over a year and a half ago, or at the very least when he "joined" in Clayne Corey's motion for summary judgment. Again, ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.