United States District Court, W.D. Washington, Seattle
ORDER GRANTING LEAVE TO FILE FIRST AMENDED ANSWER,
AFFIRMATIVE DEFENSES, AND COUNTERCLAIMS
A. TSUCHIDA UNITED STATES MAGISTRATE JUDGE
to Fed.R.Civ.P. 15, Defendants Open Source Steel, LLC, Joshua
Dellay, and James Dellay (collectively
“Defendants”) request leave to file a First
Amended Answer, Affirmative Defenses, and Counterclaims to
Plaintiff's Complaint. Dkt. 87 (Exhibit A). Defendants
seek to add an inequitable conduct affirmative defense and
counterclaim as to each of the patents at
issue. Plaintiff Elliott Kremerman opposes the
motion as untimely and prejudicial. Dkt. 89. The Court grants
January 20, 2017, Plaintiff filed this action in the Northern
District of California, alleging design patent infringement,
trade dress infringement, unfair competition, and unjust
enrichment regarding two design patents for glass
distillations heads - D775, 310 and D776, 238 (“the
‘310 and ‘238 patents, ” respectively)
(collectively “the Patents”). On June 9, 2017,
the Northern District of California granted the parties'
stipulation to transfer the case to this Court pursuant to
the U.S. Supreme Court's ruling in TC Heartland LLC
v. Kraft Foods Brands LLC, 581 U.S. (2017). Dkts. 45-46.
Following this Court's ruling on Defendants' motion
to dismiss, claims remaining for adjudication are: (1) direct
infringement of the Patents under 35 U.S.C. § 271(a);
(2) contributory infringement of the Patents under 35 U.S.C.
§ 271(c); (3) trade dress infringement under §
43(a) of the Lanham Act; and (4) unfair business practices
under California Business & Professional Code §
17200(a) (“Unfair Competition Law” hereafter, the
“UCL”). Dkt. 76.
to the transfer, the parties engaged in written discovery.
Dkt. 88, Declaration of Rick Chang, ¶ 5. Defendants made
their first production on June 8, 2017. Id., ¶
6. Plaintiff, over Defendants' objections, withheld
production until the case was fully transferred and a new
protective order was in place. Id., ¶ 7.
Plaintiff made his first production on September 11, 2017.
Id., ¶ 8. The parties met and conferred on
November 11, 2017 to discuss Defendants' concerns
regarding Plaintiff's production, the parties'
exchanged terms to conform to this District's rules on
ESI email production, and Defendants supplemented their
production on January 10, 2018 and January 22, 2018.
Id., ¶¶ 9-11. Plaintiff supplemented his
production on February 1, 2018 and February 14, 2018.
Id. Defendants state that information learned from
these productions provides the basis for their proposed
amendment. Dkt. 87 at 4.
to the November 13, 2017 Order Setting Trial Date and
Pretrial Schedule, amended pleadings are due by March 9,
2018; close of fact discovery is May 7, 2018, close of expert
discovery is June 29, 2018, and trial is set for November 13,
2018. Dkt. 84. Defendants filed their motion for leave to
amend on March 9, 2018. Dkt. 87.
to Fed.R.Civ.P. 15(a)(2), a “court should freely give
leave when justice so required.” Courts generally apply
this policy with “extreme liberty.” Eminence
Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1051 (9th
Cir. 2003). The Court looks to five factors in determining
whether to grant leave to amend: (1) bad faith; (2) undue
delay; (3) prejudice to the opposing party; (4) futility of
amendment; and (5) whether party has previously amended.
Allen v. City of Beverly Hills, 911 F.2d 367, 373
(9th Cir. 1987). While every factor is important, “the
crucial factor is the resulting prejudice to the opposing
party.” Howey v. United States, 481 F.2d 1187,
1190 (9th Cir. 1973). Absent undue prejudice, “a trial
judge should ordinarily permit a party to amend its
complaint.” Id. Plaintiff raises only undue
delay and prejudice in opposing the proposed amendment.
argues that Defendants' motion is untimely because it was
filed on the deadline for the amendment of pleadings.
Plaintiff also contends that Defendants have had the
information needed to amend their pleadings for over a month.
Dkt. 89 at 4. The deadline in the Court's Order states
simply “deadline for amendment of pleadings.”
Dkt. 84. The deadline does not require the parties to factor
in additional time for the filing of a motion. Defendants
filed their motion for leave to amend by the stated deadline
and therefore, it is not untimely.
also opposes amendment based on Defendants' failure to
allow them to see the actual proposed amendment before it was
filed. Plaintiff characterizes Defendants' actions as an
“ambush” and “rank gamesmanship.”
Dkt. 89 at 4. According to counsel for Defendants, counsel
discussed Defendants' plans to file a motion for leave to
amend by telephone on March 9, 2018, but counsel for
Plaintiff indicated he would not be able to consent to the
motion. Dkt. 88, Declaration of Rich Chang. In addition, a
copy of the Defendants' proposed amended answer and
counterclaims is attached as Exhibit A to their motion. Thus,
Plaintiff has sufficient notice that Defendants are asserting
inequitable conduct as to both patents.
Plaintiff opposes the amendment because of “the
consequence of having new affirmative defenses and
counterclaims asserted against him with only six weeks
remaining in the discovery period.” Dkt. 89. Plaintiff
submits that amendment should “be conditioned upon a
continuance of the trial date by 60 to 90 days, with all
pre-trial deadlines extended accordingly.” Dkt. 89 at
discovery does not end until May 7, 2018 (Dkt. 84) and
according to Defendants' counsel, no depositions have
been taken by either side. Additionally, Plaintiff provides
no good cause for extending all pre-trial deadlines and the
trial. If the parties, in good faith, find the need for
additional time to complete discovery, the Court will
entertain an appropriate motion if the need arises.
it is ORDERED:
1) Defendants' Motion for Leave to File First Amended
Answer, Affirmative Defenses and Counterclaims to