Pacamor Bearings, Inc. v. Minebea Co., Ltd.

Decision Date13 July 1995
Docket NumberCiv. No. 90-271-SD.
Citation892 F. Supp. 347
PartiesPACAMOR BEARINGS, INC., et al. v. MINEBEA CO., LTD., et al.
CourtU.S. District Court — District of New Hampshire

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

James L. Kruse, Concord, NH, Jack McKay, Washington, DC, for defendants.

Daniel M. Sleasman, Albany, NY, Garry R. Lane, Concord, NH, for plaintiffs.

ORDER

DEVINE, Senior District Judge.

Pending before the court at this time is a plethora of motions; this order addresses the following of same: (1) plaintiffs' motion for leave to amend their complaint; (2) defendants' motion for partial summary judgment; (3) defendants' motion to dismiss or, in the alternative, for entry of an order compelling substitution or joinder of Wells Fargo Bank, N.A., as plaintiff; and (4) defendants' motion for certification under 28 U.S.C. § 1292(b) of issues regarding plaintiffs' standing to sue. Each motion has been objected to by the nonmoving party.

A. Plaintiffs' Motion to Amend Complaint (document 111)

Plaintiffs move for leave to file an amended complaint which (1) adds two claims for relief under the Sherman Act, 15 U.S.C. § 2; (2) deletes the conspiracy claims previously dismissed by this court;1 and (3) deletes plaintiffs' claim for relief under the Anti-Dumping Act of 1916. Defendants object only to plaintiffs' attempt to add two Sherman Act claims to their complaint.

In addition, plaintiffs have filed a motion for leave to file a reply memorandum (document 121), and defendants have filed a corresponding motion for leave to file a response to said reply memorandum (document 122). Both motions are herewith granted, and the memoranda attached thereto have been filed as of the date of this order. Further, there being no objection to plaintiffs' request to delete their previously dismissed conspiracy claims (Counts II and IV) and their Anti-Dumping Act claim (Count III), plaintiffs' motion to amend is herewith granted with respect to said claims. The court turns now to plaintiffs' request to add two Sherman Act claims to their complaint.

1. Rule 15(b)

Plaintiffs assert, in part, that their motion to amend is intended to conform the pleadings to the evidence in accordance with Rule 15(b), Fed.R.Civ.P.

Rule 15(b) provides in relevant part that "when issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings." Rule 15(b) is generally invoked when the need to amend the pleadings does not become apparent until the trial has commenced or, in some cases, until the trial has come to a close. See generally, 6A CHARLES A. WRIGHT, MILLER & KANE, FEDERAL PRACTICE AND PROCEDURE: CIVIL 2D § 1491 (1990) (hereinafter WRIGHT & MILLER). See also DCPB, Inc. v. Lebanon, 957 F.2d 913, 916-17 (1st Cir.1992).

Procedurally, this action is still in the pretrial stages. Therefore, it should go without saying that the issues raised in plaintiffs' proposed Sherman Act claims have not been "tried". Further, as is evident from defendants' opposition to plaintiffs' motion, defendants have not given their express or implied consent to trial of the issues raised in said proposed claims. For these reasons, the court finds that plaintiffs are not entitled to amend their complaint to conform to the evidence under Rule 15(b) at this stage in the proceedings. Instead, plaintiffs' motion to amend must be evaluated under Rule 15(a), Fed.R.Civ.P.

2. Rule 15(a)

Rule 15(a), Fed.R.Civ.P., provides in relevant part that leave to amend a party's pleadings "shall be freely given when justice so requires." The Supreme Court, interpreting Rule 15(a), has offered the following guidance to courts on the question of whether justice requires that a motion to amend be granted.

If the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claim on the merits. In the absence of any apparent or declared reason—such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc.—the leave sought should, as the rules require, be "freely given."

Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230, 9 L.Ed.2d 222 (1962). Accord Resolution Trust Corp. v. Gold, 30 F.3d 251, 253 (1st Cir.1994) ("Leave to amend is to be `freely given' unless it would be futile or reward, inter alia, undue or intended delay." (citations omitted)); Executive Leasing Corp. v. Banco Popular de Puerto Rico, 48 F.3d 66, 71 (1st Cir.1995).

"A party's belated attempt to revise its pleadings requires that a court examine the totality of the circumstances and exercise sound discretion in light of the pertinent balance of equitable considerations." Quaker State Oil Refining Corp. v. Garrity Oil Co., 884 F.2d 1510, 1517 (1st Cir.1989). "While courts may not deny an amendment solely because of delay and without consideration of the prejudice to the opposing party, it is clear that `undue delay' can be a basis for denial...." Hayes v. New England Millwork Distribs., Inc., 602 F.2d 15, 19 (1st Cir.1979) (citations omitted). Further, "`where ... considerable time has elapsed between the filing of the complaint and the motion to amend, the movant has the burden of showing some "valid reason for his neglect and delay."'" Grant v. News Group Boston, 55 F.3d 1, 6 (1st Cir.1995) (quoting Stepanischen v. Merchants Despatch Transp. Corp., 722 F.2d 922, 933 (1st Cir.1983) (quoting Hayes, supra, 602 F.2d at 19-20)).

a. Undue Delay

This action was filed on June 15, 1990, and has thus been working its way toward trial for some five years. In light of the considerable amount of time that has elapsed between the filing of the complaint and the pending motion to amend,2 the court finds that plaintiffs have "`the burden of showing some valid reason for their neglect and delay.'" Grant, supra, 55 F.3d at 6 (quoting Stepanischen, supra, 722 F.2d at 933) (other citations omitted).

Plaintiffs maintain that there has been no undue delay here because plaintiffs sought to amend their complaint shortly after new evidence which supported a Sherman Act claim came to light. After discovering this "new" evidence, plaintiffs assert they sought defendants' consent to their motion to amend by letter dated September 28, 1994. A series of communications between the parties followed, culminating in defendants' November 10 refusal to consent to the motion to amend.

Shortly thereafter, the parties agreed to mediate this case and filed a joint motion to hold the proceedings in abeyance pending mediation. Said motion, which was granted by the court on December 15, 1994, provided in relevant part,

In order for the parties to devote all of their energy and attention to the settlement process, they have agreed, subject to the approval of this Court, that these proceedings, including discovery and filing of additional motions, should be held in abeyance temporarily. The parties have also agreed that the suspension of proceedings and lapse of time associated therewith shall be without prejudice to their positions with respect to any issue relating to the timing or timeliness of filings or other matters in connection with this case.

Joint Motion filed Dec. 9, 1994 (document 105) 2 (emphasis added).

On February 10, 1995, the parties filed with the court a Joint Status Report and Request to Renew Motions, indicating that their mediation had been unsuccessful. By letter dated February 17, 1995, plaintiffs renewed their request for defendants' consent to their motion to amend. Defendants declined to give such consent, and plaintiffs filed the pending motion on March 10, 1995.

Defendants first contend that plaintiffs have failed to adequately explain the three-month delay between plaintiffs' first notification to defendants of their intent to amend and their actual filing of the motion.3

In light of plaintiffs' diligent efforts between September 28 and November 10, 1994, to obtain defendants' consent to their motion to amend, the parties' subsequent agreement to mediate the case, and their corresponding agreement that the lapse of time associated with their mediation efforts would not prejudice their positions "with respect to any issue relating to the timing or timeliness of filings or other matters in connection with this case," Joint Motion 2, the court finds that plaintiffs have met their burden of showing some valid reason for the delay between September 1994 and March 1995. Accordingly, the court turns to the question of whether plaintiffs have shown some valid reason why their proposed amendments were not made prior to September 1994.

Plaintiffs justify their delay by explaining that they notified defendants of their intent to add the proposed Sherman Act claims as soon as new evidence supporting such claims came to light during the course of discovery. Defendants respond that plaintiffs' "claim of `newly discovered evidence' is disingenuous at best," Defendants' Opposition Memorandum at 5, and cannot explain the four-year delay between the filing of this action and plaintiffs' current attempt to amend.

Plaintiffs repeatedly indicate in their motion and related memoranda that the proposed Sherman Act claims are "based on the same wrongful conduct" and the "same operative facts" as the claims set forth in their Second Amended Complaint.4 Affidavit of Daniel M. Sleasman 10-13 (attached to Plaintiffs' Motion). Simultaneously, plaintiffs contend that their proposed claims are based on newly discovered evidence such that they could not have moved to amend their complaint any earlier.

One of the examples of newly discovered evidence plaintiffs cite is evidence that defendants engaged in a multi-year fraud involving the substitution of a...

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