United States District Court, W.D. Washington, Tacoma
ORDER ON MOTIONS FOR RECONSIDERATION AND FOR LEAVE TO
AMEND [Dkt. #s 75, 76, 80]
HONORABLE RONALD B. LEIGHTON JUDGE
MATTER is before the Court on Plaintiff Luken's Motion
for Reconsideration [Dkt. #75] of the Court's Order [Dkt.
#74] dismissing his “breach of fiduciary duty”
claims, based on a newly-discovered statute (RCW 88.02.770)
that he claims requires boat dealers to hold customer
deposits “in trust.” Also before the Court is
Luken's related Motion to Amend his Complaint [Dkt. #76].
Luken seeks to add a claim under this statute, and to add 2
new parties and 13 other new claims. He seeks to add
Christensen Shipyards LLC as a plaintiff, asserting claims
related to its predecessor's (CSL)'s lease from
Defendant CGI. Adding CSLLC as a plaintiff would destroy this
court's diversity jurisdiction.
Defendants oppose reconsideration on (and amendment to add)
the statutory fiduciary duty claim. They argue that the
statute is not applicable-Luken was an owner and member of
the Board, not a regular “customer, ” and he did
not make a cash deposit-and that Luken's effort to revive
his fiduciary duty claim based on a newly-discovered statute
is time-barred and futile. They also oppose the amendment to
add Christensen Shipyards, LLC's new claims, because the
case was filed more than a year ago and the deadline for
adding parties passed last fall. The trial is scheduled for
February 16, 2018. They claim that discovery and motions
practice has been ongoing-eight terabytes of data
has already been produced-and that they will be prejudiced if
Luken is permitted to now add parties and claims requiring
them to start anew. They also argue that the newly-named
parties and the newly- asserted claims would be futile.
for Reconsideration are disfavored, and will ordinarily be
denied absent a showing of manifest error, or a new factual
or legal basis which could not have been raised earlier.
Local Rule 7(h).
to amend a complaint under Fed.R.Civ.P. 15(a) “shall be
freely given when justice so requires.” Carvalho v.
Equifax Info. Services, LLC, 629 F.3d 876, 892 (9th Cir.
2010) (citing Forman v. Davis, 371 U.S. 178, 182
(1962)). This policy is “to be applied with extreme
liberality.” Eminence Capital, LLC v. Aspeon,
Inc., 316 F.3d 1048, 1051 (9th Cir. 2003) (citations
omitted). In determining whether to grant leave under Rule
15, courts consider five factors: “bad faith, undue
delay, prejudice to the opposing party, futility of
amendment, and whether the plaintiff has previously amended
the complaint.” United States v. Corinthian
Colleges, 655 F.3d 984, 995 (9th Cir. 2011)
(emphasis added). Among these factors, prejudice to the
opposing party carries the greatest weight. Eminence
Capital, 316 F.3d at 1052.
proposed amendment is futile “if no set of facts can be
proved under the amendment to the pleadings that would
constitute a valid and sufficient claim or defense.”
Gaskill v. Travelers Ins. Co., No. 11-cv-05847-RJB,
2012 WL 1605221, at *2 (W.D. Wash. May 8, 2012) (citing
Sweaney v. Ada County, Idaho, 119 F.3d 1385, 1393
Motion for Reconsideration of the Order dismissing the
fiduciary duty claims is GRANTED to the limited extent that
Luken will be permitted to assert such a claim based on RCW
88.02.070. The other fiduciary duty claims remain dismissed.
Defendants may attack the viability of this claim through
related Motion to Amend his complaint to add this state law
claim is also GRANTED.
Motion to Amend to add CSLLC (or to allow it to
“intervene”) as a plaintiff, nine months after
the deadline for doing so, and where adding CSLLC would
destroy this court's diversity jurisdiction, is DENIED.
Motion to Amend to add a rescission/reformation claim,
seeking to unwind Luken's 2003 stock purchase from
non-party (and now-defunct) CSL [the Second Claim for relief
in Lukens' proposed second amended complaint] is also
argue that permitting Luken to assert other new claims-a
claim based on a 2001 guaranty, and a sort of equitable
subordination claim-would be futile. They argue, for example,
the guaranty at issue was not intended to apply as broadly as
Luken now claims, and that the subordination claim is really
an affirmative defense to a counterclaim. These arguments may
ultimately be correct. But they are summary judgment-type
arguments; the claims are not facially so deficient that the
Court can say it would be futile to add them now. The Motion
to Amend to assert these additional claims is GRANTED.
proposed second amended complaint asserts a variety of
additional claims, but the Defendants' Response does not
specifically address them (other than to argue that all are
too late and prejudicial). Leave to amend to assert these
“un-discussed” claims is GRANTED.
should file a second amended complaint consistent with this
Order within 10 days. Leave for any additional amendments is
unlikely. The Court will entertain a motion for ...