King & King Enterprises v. Champlin Petroleum Co.

• Decision Date: 07 February 1978
• Docket Number: No. 75-276-C.,75-276-C.
• Parties: KING & KING ENTERPRISES d/b/a King Gas & Oil and Carl R. King, d/b/a King Gas & Oil, Plaintiffs, v. CHAMPLIN PETROLEUM COMPANY, Defendant, v. Fred Dea ENTRIKEN, Third-Party Defendant.
• Court: U.S. District Court — Eastern District of Oklahoma

446 F. Supp. 906

KING & KING ENTERPRISES d/b/a King Gas & Oil and Carl R. King, d/b/a King Gas & Oil, Plaintiffs, v. CHAMPLIN PETROLEUM COMPANY, Defendant, v. Fred Dea ENTRIKEN, Third-Party Defendant.

No. 75-276-C.

United States District Court, E. D. Oklahoma.

February 7, 1978.

Douglas J. Parry, Raymond J. Etcheverry, Berman & Giauque, Salt Lake City, Utah, for plaintiffs.

Cecil E. Munn, Fort Worth, Tex., A. Camp Bonds, Sr., Muskogee, Okl., Charles B. Swanner, J. D. Henry, Charles A. Zubieta, Champlin Petroleum Co., Fort Worth, Tex., for defendant.

Floyd L. Walker, Tulsa, Okl., for third-party defendant.

ORDER DENYING PLAINTIFFS' MOTION FOR LEAVE TO FILE AN AMENDED COMPLAINT

MORRIS, Chief Judge.

In its order of December 13, 1977 the court directed the parties to submit materials relevant to third-party defendant Entriken's period of employment with Champlin so as to enable the court to rule on plaintiffs' motion for leave to amend for the purpose of adding Dewey Mason and Mickey Bowles as parties defendant. Defendant has furnished the deposition of Entriken and plaintiffs have submitted their proposed amended complaint. In addition several briefs have been filed setting forth the parties' respective positions relative to the motion for leave to amend.

Plaintiffs seek leave to file their first amended complaint, adding Dewey Mason and Mickey Bowles as parties defendant, "on the grounds that Mr. Mason and Mr. Bowles were actively involved in rigging the retail price of refined petroleum products in certain markets of the States of Oklahoma, Texas and Arkansas, while Dea Entriken was employed by Champlin." Plaintiffs' Motion for Leave to File an Amended Complaint at 1 (emphasis added).

Defendant opposes the motion on the grounds that plaintiffs' claims sought to be asserted against Mason and Bowles are barred by the statute of limitations and that, contrary to plaintiffs' contention, they do not relate back to the filing date of the original complaint.

Plaintiffs urge that the proposed amended complaint relates back and therefore is not barred by the statute of limitations, but if it does not relate back, the running of the limitations period has been tolled by virtue of fraudulent concealment on the part of Champlin, Mason and Bowles.

The original complaint in this case was filed on October 2, 1975. Plaintiffs filed their motion for leave to amend on August 18, 1977. Entriken was employed by Champlin until April 11, 1973.¹ Since plaintiffs' express purpose for leave to amend is to add antitrust claims against Mason and Bowles for acts allegedly committed while Entriken was employed by Champlin,² it appears that such claims are untimely in that they are sought to be asserted more than four years after Entriken's employment with Champlin was terminated.³ Plaintiffs do not argue in any of their memoranda filed in support of their motion that their claims against Mason and Bowles are based on any acts allegedly committed subsequent to Entriken's period of employment with Champlin. Instead plaintiffs argue that Mason and Bowles did in fact conspire to fix prices, that the proposed amendment relates back under Rule 15(c) Federal Rules of Civil Procedure, and that the statute of limitations was tolled pursuant to the fraudulent concealment rule. The closest plaintiffs come to suggesting that their antitrust claims against Mason and Bowles may be based on acts other than those allegedly committed during Entriken's period of employment are allegations of a continuing conspiracy,⁴ and the statement that "to date there has been no evidence produced which would indicate that this conspiracy or the predatory practices facilitating its implementation have been terminated."⁵

Leave to amend is to be freely granted. Rule 15(a) Federal Rules of Civil Procedure; Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962); United States v. Hougham, 364 U.S. 310, 316-17, 81 S.Ct. 13, 5 L.Ed.2d 8 (1960); McGoffin v. Sun Oil Co., 539 F.2d 1245, 1248 (10th Cir. 1976); Polin v. Dun & Bradstreet, Inc., 511 F.2d 875, 877 (10th Cir. 1975); Wyoming Construction Co. v. Western Casualty & Surety Co., 275 F.2d 97, 104 (10th Cir.) cert. denied, 362 U.S. 976, 80 S.Ct. 1061, 4 L.Ed.2d 1011 (1960); Ziegler v. Akin, 261 F.2d 88, 90 (10th Cir. 1958). The grant or denial of an opportunity to amend is within the sound discretion of the trial court. Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962); Polin v. Dun & Bradstreet, Inc., 511 F.2d 875, 877 (10th Cir. 1975); Travelers Indemnity Co. v. United States ex rel. Construction Specialties Co., 382 F.2d 103, 106 (10th Cir. 1967); Wyoming Construction Co. v. Western Casualty & Surety Co., 275 F.2d 97, 104 (10th Cir.), cert. denied, 362 U.S. 976, 80 S.Ct. 1061, 4 L.Ed.2d 1011 (1960); Ziegler v. Akin, 261 F.2d 88, 90 (10th Cir. 1958). However, new parties cannot be added by way of amendment after the statute of limitations has run unless the requirements of Rule 15(c) Federal Rules of Civil Procedure have been met.

Rule 15(c) provides in pertinent part:

(c) Relation Back of Amendments. Whenever the claim or defense asserted in the amended pleading arose out of the conduct, transaction, or occurrence set forth or attempted to be set forth in the original pleading, the amendment relates back to the date of the original pleading. An amendment changing the party against whom a claim is asserted relates back if the foregoing provision is satisfied and, within the period provided by law for commencing the action against him, the party to be brought in by amendment (1) has received such notice of the institution of the action that he will not be prejudiced in maintaining his defense on the merits, and (2) knew or should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against him.

It is proper for the court to consider the statute of limitations on a motion to amend. "To delay until there is a later motion to dismiss because the claim is time-barred would be a wasteful formality." Middle Atlantic Utilities Co. v. S. M. W. Development Corp., 392 F.2d 380, 385 (2d Cir. 1968); Poloron Products, Inc. v. Lybrand Ross Bros. & Montgomery, 72 F.R.D. 556, 562 (S.D.N.Y.1976); see 3 J. Moore, Federal Practice par. 15.084, at 906 (2d ed. 1974).

Plaintiffs rely on Clark v. Universal Builders, Inc., 501 F.2d 324 (7th Cir.), cert. denied, 419 U.S. 1070, 95 S.Ct. 657, 42 L.Ed.2d 666 (1974) for the proposition that it is error not to grant leave to amend to add parties defendant who were on constructive notice of the action and were active participants in it since its inception. 501 F.2d at 339-40. Plaintiffs of course claim such notice and participation with respect to Mason and Bowles. Clark is not applicable to the situation presented in the case at bar since it did not involve any statute of limitations and relation back issues.

Plaintiffs also rely on Wirtz v. Mercantile Stores, Inc., 274 F.Supp. 1000 (E.D.Okl. 1967). Judge Daugherty held in Wirtz that an amendment naming an additional party defendant after the expiration of the limitations period related back under Rule 15(c). However, the court expressly found in Wirtz that the additional defendant, a wholly owned subsidiary of the original defendant, knew or should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against it. 274 F.Supp. at 1001. The person served with process in Wirtz was the manager and agent of the additional defendant, but was not the agent of the original defendant or authorized to receive service of process for it. The complaint served on the additional defendant's manager contained allegations of Fair Labor Standards Act violations involving the additional defendant's employees and its place of business. The additional defendant was therefore put on notice of plaintiff's mistake.

Plaintiffs in the instant action do not claim that they mistakenly failed to name Mason and Bowles as defendants at the outset. It certainly cannot be said that Mason and Bowles had any reason to suspect that plaintiffs had made a mistake in suing Champlin and not them. To the contrary, it would have been entirely reasonable for them to assume that plaintiffs had made a strategic choice of defendant which does not qualify as a mistake under Rule 15(c). Francis v. Pan American Trinidad Oil Co., 392 F.Supp. 1252, 1259 n. 13 (D.Del. 1975). See 6 C. Wright & A. Miller, Federal Practice and Procedure: Civil § 1498, at 510 (1971). As the Tenth Circuit stated in Archuleta v. Duffy's, Inc., 471 F.2d 33 (10th Cir. 1973):

Nor can we agree that the naming of the defendant as Denver Pop Company constituted a simple misnomer. The defendant was not misdescribed but was deliberately, although mistakenly, sued. An entity different from the one named and appearing during the administrative process was made a party. Although this court is committed to the general proposition that it will not allow technicalities to defeat the proper administration of justice, e. g., Travelers Indemnity Co. v. United States for Use of Construction Specialties Co., 10 Cir., 382 F.2d 103, and will allow misnomers to be amended and relate back as a matter of course, Wynne v. United States for Use of Mid-States Waterproofing Co., 10 Cir., 382 F.2d 699, the court is equally committed to the necessity of distinguishing between misnomers and substitution of parties. Graves v. General Insurance Corp., 10 Cir., 412 F.2d 583. The trial court has here allowed a substitution of parties by amendment. Such amendment can relate back to the date the complaint was filed only if the provisions of Rule 15(c) are met.

Plaintiff has not by amendment changed the factual content of his complaint and has thus met the compulsion of the first sentence of Rule 15(c). And the trial court correctly found that defendant has suffered no prejudice in fact, a

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