Commercial Litigation and Arbitration

In Ruling on Motion to Amend after Scheduling Order Deadline, Court Need Not Consider Lack of Prejudice to Adversary — Only Diligence Must Be Considered

Kodak Graphic Commc’ns Canada Co. v. E.I. Du Pont de Nemours & Co., 2011 U.S. Dist. LEXIS 148853 (W.D.N.Y. Dec. 28, 2011):

On June 26, 2009, [Magistrate] Judge Payson entered a stipulated scheduling order, setting the deadline to file any motions to amend the pleadings as July 31, 2009. ***

On September 20, 2010, fourteen months after the deadline to file motions to amend expired, DuPont filed a motion to amend its answer and counterclaims. (Docket No. 33.) In its motion to amend, DuPont specifically stated that the allegations it sought to include in its amended pleading were "not new; they simply supply additional detail and flesh out DuPont's original claims and defenses." (Docket No. 33 at 2.) Kodak opposed DuPont's motion arguing that DuPont did not demonstrate the requisite "good cause" for the proposed amendments pursuant to Federal Rule of Civil Procedure 16(b)(4) ("Rule 16(b)"), and that in the alternative, that permitting the proposed amendments was futile.

***In her R & R, Judge Payson recommended that this Court deny DuPont's motion to amend on the grounds that DuPont had not demonstrated good cause pursuant to Rule 16(b). In making this determination, Judge Payson specifically declined to consider the lack of prejudice to Kodak, stating:

"A review [of] the caselaw in this Circuit reveals a split of authority on the issue of whether the moving party must make a threshold showing of good cause before the Court considers prejudice or whether prejudice should be considered irrespective of good cause. After consideration of the relevant Second Circuit law, this Court finds that the former is the better approach, and is the one that has been most consistently followed in this district. See Woodworth v. Erie Ins. Co., 2009 WL 3671930 at *3 ('the absence of prejudice to a nonmoving party does not alone fulfill the good cause requirement of Rule 16(b)'). Accordingly, because I find that DuPont has not shown good cause for the amendments, I do not consider whether Kodak would be prejudiced by the proposed amendments."


1. Standard to Modify a Scheduling Order

DuPont objects to Judge Payson's Rule 16(b) analysis, contending that Judge Payson improperly failed to consider the lack of prejudice to Kodak in determining that DuPont failed to establish good cause for its amendments. Rule 16(b) provides that a scheduling order issued by the court "may be modified only for good cause and with the judge's consent." Fed. R. Civ. P. 16(b)(4).

Footnote 3. Rule 16(b) applies to motions to amend a pleading, rather than Rule 15(a), where a scheduling order governs amendments to the pleadings. See Holmes v. Grubman, 568 F.3d 329, 334-5 (2d Cir. 2009).

The Second Circuit has stated that while the "primary consideration," in determining whether the moving party has demonstrated good cause for an amendment under Rule 16(b) "is whether the moving party can demonstrate diligence [,]...[t]he district court, in the exercise of its discretion under Rule 16(b), also may consider other relevant factors, including, in particular, whether allowing the amendment of the pleading at this stage of the litigation will prejudice [the non-moving party]." Kassner v. 2nd Avenue Delicatessen Inc., 496 F.3d 229, 244 (2d Cir. 2007)***.

This Court does not interpret Kassner to require the consideration of prejudice to the non-moving party in all circumstances or that the lack of prejudice to the non-moving party would negate the requirement that the moving party act with diligence to amend its pleadings. See Woodworth, 2009 WL 3671930 at *3 ("The Court does not understand this language from Kassner to mean that where the moving party has not been diligent, a court may nonetheless grant the motion if it would not prejudice the non-moving party."). Therefore, the Court finds that Judge Payson's well-reasoned decision on this issue is neither clearly erroneous nor contrary to law.

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