United States District Court, E.D. Missouri, Southeastern Division
MEMORANDUM AND ORDER
STEPHEN N. LIMBAUGH, JR UNITED STATES DISTRICT JUDGE.
matter comes before the Court on plaintiff BlueLine Rental
LLC.'s motion for leave to file a first amended complaint
(#32) and motion for leave to file the first amended
complaint under seal (#33). For the reasons stated below,
this Court will GRANT plaintiff's motion
for leave to file the amended complaint but will
DENY its motion for leave to file that
complaint under seal.
operates a rental business for heavy industrial and
construction equipment. Defendant Dana Rowland is a former
manager of plaintiff's branch in Scott City, Missouri. As
a branch manager, Rowland was given access to plaintiff's
confidential and trade secret information including
“pricing policies, sales data, information regarding
customers[, ] and other market data.” Plaintiff alleges
Rowland resigned in March of 2018 asserting a need to
“help her husband start his new business” when,
in reality, Rowland joined competitor Sunbelt Rentals, Inc.
After joining Sunbelt, Rowland purportedly began to
“raid” plaintiff's Scott City branch by
encouraging four employees to join her at Sunbelt
“within days of each other” throughout the month
of July, 2018. Plaintiff also alleges Rowland solicited its
Rowland joined plaintiff's business, she signed an
employment agreement that included provisions for
confidentiality, non-solicitation, and non-competition.
Plaintiff's original complaint asserts claims for breach
of contract, injunctive relief, and declaratory judgment
designed to force Rowland's compliance with the
employment agreement's terms.
6, 2019, Rowland produced “hundreds of pages of
documents” that “revealed facts supporting
various claims against Sunbelt” and “other former
BlueLine employees [including] Joseph Kelpe and Aleshia
Musgrave” for “breach of contract, breach of
fiduciary duty, tortious interference, aiding and abetting,
and fraudulent misrepresentation.” In addition,
plaintiff says these documents support “additional
claims against Rowland for breach of fiduciary duty, aiding
and abetting, tortious interference, and fraudulent
concealment / non-disclosure.” Plaintiff's motion
seeks leave to file a first amended complaint adding these
parties and claims.
filed its proposed first amended compliant under seal,
accompanied by a motion for leave to keep the complaint under
seal. Plaintiff has done this because “the proposed
Amended Complaint includes allegations of facts [and
exhibits] gleaned from [the May 6, 2019] documents produced
by [Rowland], which [she] designated [as] confidential under
the Court's [April 30, 2019] Protective Order.”
Plaintiff disagrees with Rowland's assessment that the
relied-upon documents are, indeed, confidential as understood
by this Court's Protective Order; but, it filed the
amended complaint and exhibits under seal “in an
abundance of caution.”
Leave to File an Amended Complaint Under Rule
motion was filed under Federal Rule of Civil Procedure
15(a)(2), which allows a party to amend their complaint
“only with the opposing party's consent or the
court's leave.” Fed.R.Civ.P. 15(a)(2) The
“court should freely give leave when justice so
requires.” Id. “A Court abuses its
discretion when it denies a motion to amend a complaint
unless there exists undue delay, bad faith, repeated failure
to cure deficiencies by amendment previously allowed, undue
prejudice to the non-moving party, or futility of the
amendment.” Kozlov v. Associated Wholesale Grocers,
Inc., 818 F.3d 380, 394 (8th Cir. 2016).
Court begins by noting plaintiff's motion to amend-filed
on July 8, 2019- was timely under the deadlines of the case
management order. (#28, 32). That alone would ordinarily
decide the issue. But, timely or not, Rowland argues any
amendment would be futile because, just a few days earlier,
plaintiff failed to follow another deadline of the case
management order; specifically, plaintiff failed to disclose
expert testimony and attendant expert reports by the case
management order's deadline of July 5, 2019. And without
these experts, Rowland explains, plaintiff cannot prove
damages or establish crucial facts requiring expert
testimony. The Court rejects this argument as it confuses the
futility standard applicable to a Rule 15(a)(2) motion.
“Denial of a motion for leave to amend on the basis of
futility means the district court has reached the legal
conclusion that the amended complaint could not withstand a
motion to dismiss under Rule 12(b)(6) of the Federal Rules of
Civil Procedure.” Doe v. Dardanelle Sch.
Dist., 928 F.3d 722, 727 (8th Cir. 2019). Rowland does
not explain how Rule 12(b)(6) might be implicated here. And
to the extent Rowland focuses instead on the missed discovery
deadline, her argument also fails to grapple with the fact
that Rule 16(b)(4) allows modification of a scheduling order
for good cause shown. See Fed. R. Civ. P. 16(b)(4).
Rowland simply has not demonstrated the futility of
plaintiff's proposed pleading amendments.
also argues plaintiff's motion should be denied because
plaintiff may have delayed the scheduling of certain
depositions-a tactic Rowland says caused undue delays and was
in bad faith. Plaintiff explains in its reply brief that
depositions were delayed in anticipation of adding new
parties and claims that would change the scope of the case.
The Court, again, rejected Rowland's argument. While she
is content to label plaintiff's conduct as being in
“bad faith” or else resulting in “undue
delays, ” what must be established is the existence of
dishonest purpose or prejudice-neither of which Rowland has
demonstrated or even seriously attempted to show. See
Long v. Oakley Fertilizer, Inc., 994 F.Supp.2d 1057,
1060 (E.D. Mo. 2014) (“delay alone is not enough to
deny a motion to amend; prejudice to the nonmovant must also
be shown”); Wizards of the Coast, LLC. v.
Cryptozoic Entertainment, LLC., 309 F.R.D. 645 (W.D. Wa.
2015) (bad faith not supported where there was no evidence of
“conscious doing of a wrong” or a
“dishonest purpose or moral obliquity” in seeking
remaining arguments are either entirely unsupported or bound
to procedural irregularities insufficient to override the
liberal mandate of Rule 15(a)(2). For example, Rowland points
out that plaintiff did not file a separate memorandum in
support of its motion as required by Local Rule 4.01(A).
Plaintiff calls this argument a “hyper-technical
objection.” To the extent plaintiff's response
implies the Local Rules can be ignored or have no bite, this
Court disagrees and admonishes plaintiff to abide by them
moving forward. But, plaintiff is right to suggest its motion
should not ordinarily be denied for technical reasons like
this, alone, given Rule 15(a)(2)'s liberal amendment
been presented no valid reason why this Court should not
grant plaintiff's motion, it will be granted and the
first amended complaint (#34) shall be deemed filed as ...