771 F.3d 1230 (10th Cir. 2014), 14-1013, Gorsuch, Ltd. v. Wells Fargo National Bank Ass'n

Docket Nº:14-1013
Citation:771 F.3d 1230
Opinion Judge:MATHESON, Circuit Judge.
Party Name:GORSUCH, LTD., B.C., a Colorado corporation; GORSUCH, LIMITED AT ASPEN, a Colorado corporation; GORSUCH, LIMITED AT KEYSTONE MOUNTAIN, a Colorado corporation; GORSUCH COOPER, LLC, a Colorado limited liability company, Plaintiffs - Appellants, v. WELLS FARGO NATIONAL BANK ASSOCIATION, Defendant - Appellee and GORSUCH, LTD., a Colorado corporation, P
Attorney:Richard B. Podoll, Podoll & Podoll, P.C., Greenwood Village, Colorado (Robert A. Kitsmiller, Podoll & Podoll, P.C., Greenwood Village, Colorado, and Matthew C. Ferguson, The Matthew C. Ferguson Law Firm, Aspen, Colorado, with him on the briefs), appearing for Plaintiffs-Appellants. Brian J. Berar...
Judge Panel:Before KELLY, LUCERO, and MATHESON, Circuit Judges.
Case Date:November 04, 2014
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit

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771 F.3d 1230 (10th Cir. 2014)

GORSUCH, LTD., B.C., a Colorado corporation; GORSUCH, LIMITED AT ASPEN, a Colorado corporation; GORSUCH, LIMITED AT KEYSTONE MOUNTAIN, a Colorado corporation; GORSUCH COOPER, LLC, a Colorado limited liability company, Plaintiffs - Appellants,

and

GORSUCH, LTD., a Colorado corporation, Plaintiff,

v.

WELLS FARGO NATIONAL BANK ASSOCIATION, Defendant - Appellee

No. 14-1013

United States Court of Appeals, Tenth Circuit

November 4, 2014

Page 1231

[Copyrighted Material Omitted]

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APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO. (D.C. No. 1:11-CV-00970-PAB-MEH).

Richard B. Podoll, Podoll & Podoll, P.C., Greenwood Village, Colorado (Robert A. Kitsmiller, Podoll & Podoll, P.C., Greenwood Village, Colorado, and Matthew C. Ferguson, The Matthew C. Ferguson Law Firm, Aspen, Colorado, with him on the briefs), appearing for Plaintiffs-Appellants.

Brian J. Berardini (David C. Walker, with him on the brief), Brown, Berardini & Dunning, P.C., Denver, Colorado, appearing for Defendant-Appellee.

Before KELLY, LUCERO, and MATHESON, Circuit Judges.

OPINION

MATHESON, Circuit Judge.

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In 2008, Wells Fargo extended a $14 million line of credit to Gorsuch, Ltd., a ski equipment, apparel, and home furnishing company. In 2009, when Gorsuch, Ltd.'s winter sales were lower than expected, Wells Fargo suspended the line of credit. Gorsuch, Ltd. and the Gorsuch Entities--Gorsuch, Ltd., B.C.; Gorsuch, Limited at Aspen; Gorsuch, Limited at Keystone Mountain; and Gorsuch Cooper, LLC--sued Wells Fargo for damages.1

The Gorsuch Entities contend they were intended third-party beneficiaries of the Credit Agreement and were not subject to a clause precluding third-party beneficiaries from bringing suit. The district court disagreed and dismissed them from the litigation. After Gorsuch, Ltd. and Wells Fargo proceeded to arbitration, Gorsuch Cooper and Gorsuch, Limited at Aspen (" Gorsuch Cooper and Aspen" ) sought to

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amend the complaint to add additional tort claims. The district court determined (1) Gorsuch Cooper and Aspen were no longer parties, and (2) they had not shown good cause to amend after the deadline established in the scheduling order. It denied the motion. On appeal, the Gorsuch Entities challenge the order dismissing them from the case. Gorsuch Cooper and Aspen appeal the denial of their motion to amend the complaint.2

Exercising jurisdiction under 28 U.S.C. § 1291, we affirm the district court.

I. BACKGROUND

A. Factual History

Renie and David Gorsuch founded Gorsuch, Ltd. in 1962. They subsequently formed Gorsuch, Ltd., B.C.; Gorsuch, Limited at Aspen; and Gorsuch, Limited at Keystone Mountain to operate additional retail stores, and formed Gorsuch Cooper to own the property from which Gorsuch, Limited at Aspen conducts its operations. The Gorsuches and their three sons own all of the Gorsuch Businesses.

The Gorsuch Businesses are separate legal entities, but their finances and operations are intermingled. Wells Fargo and its predecessors, United Bank of Denver and Norwest Bank, provided credit to Gorsuch, Ltd. for over 40 years. Wells Fargo was aware Gorsuch, Ltd. allocated capital to the Gorsuch Entities, and considered the aggregate operations of the Gorsuch Businesses when it calculated loans and security throughout the lending relationship.

On October 31, 2008, Gorsuch, Ltd. and Wells Fargo entered into a Credit Agreement through which Wells Fargo extended a $14 million line of credit to " finance Borrower's working capital requirements." App. at 63. Section 7.6--the No Third Party Beneficiaries provision (" NTPB" ) at issue in this litigation--precluded any recognition of third-party beneficiaries or their claims. The NTPB provision specified the Credit Agreement

is made and entered into for the sole protection and benefit of the parties hereto and their respective permitted successors and assigns, and no other person or entity shall be a third party beneficiary of, or have any direct or indirect cause of action or claim in connection with, this Agreement or any other of the Loan Documents to which it is not a party.

Id. at 76. Gorsuch, Ltd. and Wells Fargo signed the Credit Agreement, and the Gorsuch Entities signed as guarantors.

On January 6, 2009, Gorsuch, Ltd. notified Wells Fargo that the economic recession and poor snowfall had significantly weakened peak season sales. Wells Fargo suspended access to the line of credit on January 23, 2009. On August 31, 2009, Wells Fargo accelerated the line of credit and past loans, and declared all payments immediately due with interest.

B. Procedural History

On March 23, 2011, the Gorsuch Businesses commenced litigation in Colorado state court, which Wells Fargo removed to federal court.3 Gorsuch, Ltd. alleged

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breach of contract, breach of the covenant of good faith and fair dealing, and fraudulent inducement. The Gorsuch Entities asserted third-party beneficiary claims. Wells Fargo moved to dismiss the Gorsuch Entities' third-party beneficiary claims under Rule 12(b)(6) and to compel arbitration of Gorsuch, Ltd.'s claims. In the scheduling order, the magistrate judge set a deadline of July 12, 2011 for any amendments to the pleadings.

On November 17, 2011, the district court determined Gorsuch Cooper was not a permitted assignee of Gorsuch, Ltd., and was therefore subject to the Credit Agreement's NTPB provision. It also held the NTPB provision precluded the Gorsuch Entities from seeking relief as third-party beneficiaries. The court granted Wells Fargo's motion to dismiss the third-party beneficiary claims, dismissed the Gorsuch Entities as plaintiffs, stayed the action while Gorsuch, Ltd. and Wells Fargo proceeded to arbitration, and administratively closed the case. The court noted that if the parties did not act to reopen the case by December 1, 2012, the case would be dismissed without prejudice. Gorsuch, Ltd. and Wells Fargo then commenced arbitration.4

On December 16, 2011, Gorsuch, Ltd. moved for leave to file a second amended complaint.5 The district court held the motion in abeyance, noting that no party had filed a motion to reopen the case, meaning it remained administratively closed. Gorsuch, Ltd. moved to reopen the case on December 21, 2011, but withdrew the motion on April 6, 2012 as it arbitrated its claims. On April 26, 2012, the district court denied the motion for leave to file a second amended complaint without prejudice to refiling if the case was reopened.

The parties took no further action before the December 1, 2012 deadline; accordingly, the district court dismissed the case without prejudice on December 3, 2012. On the same day, Gorsuch, Ltd. moved to reconsider the dismissal, which the district court granted on March 14, 2013. On April 1, 2013, Gorsuch, Ltd. then moved to reopen the case, which the district court granted on May 8, 2013. Finally, on July 10, 2013, Gorsuch, Ltd. moved for the court to confirm the arbitration award and also moved along with Gorsuch Cooper and Aspen to file a third amended complaint.6 The court confirmed the arbitration award, which concluded Gorsuch, Ltd.'s involvement in the case. This left Gorsuch Cooper and Aspen seeking in the third amended complaint to bring two new claims against Wells Fargo for intentional interference with contract and intentional interference with prospective business advantage.

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On August 21, 2013, a magistrate judge issued a minute order clarifying the district court had dismissed all plaintiffs except Gorsuch, Ltd. on November 17, 2011. The magistrate judge recommended the district court deny the motion for leave to file a third amended complaint. On December 13, 2013, the district court agreed with the magistrate judge that Gorsuch Cooper and Aspen (1) had been dismissed from the litigation and (2) had not shown good cause for failing to assert the new tort claims until after the deadline to amend pleadings. The district court therefore denied their motion to amend the complaint. On December 17, 2013, the district court issued a final judgment. The Gorsuch Entities filed a timely appeal.

II. DISCUSSION

This appeal contends the district court erred in (1) dismissing the Gorsuch Entities based on the NTPB provision, and (2) denying Gorsuch Cooper and Aspen's motion for leave to amend their complaint. To address these issues, we apply Colorado law.7 We conclude the district court (1) correctly dismissed the Gorsuch Entities, and (2) properly denied Gorsuch Cooper and Aspen's motion to amend based on their failure to show good cause under Federal Rule of Civil Procedure 16.

A. Third-Party Beneficiary Claims

We review a Rule 12(b)(6) motion to dismiss de novo. Smith v. United States, 561 F.3d 1090, 1098 (10th Cir. 2009). We ask whether the factual allegations in the complaint, if accepted as true, allege a plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678-79, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 554-57, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007).

On appeal, the Gorsuch Entities present two arguments as to why they were improperly dismissed: (1) Gorsuch Cooper was a permitted assignee of Gorsuch, Ltd. and therefore not subject to the NTPB provision, and (2) the totality of the circumstances shows the Gorsuch Entities were intended third-party beneficiaries of the Credit Agreement. Neither argument is convincing.

1. Purported Assignment to Gorsuch Cooper

According to the NTPB provision, the Credit Agreement " is made and entered into for the sole protection and benefit of the parties hereto and their respective permitted successors and assigns," and all others are precluded from bringing claims. App. at 76. Gorsuch Cooper argues it is a permitted assignee and can therefore bring suit under the Credit Agreement.

For evidence of the...

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