D. Conn. Denies Defendant's Motion to Dismiss; Grants Plaintiff's Motion to Extend Service Time Based on Excusable Neglect

Per Jackson v. Connecticut, --- F.R.D. ----, 2007 WL 2122013, (D.Conn., July 25, 2007) (NO. 3:06 CV 1274 JBA):

Rule 4(m) provides, inter alia, that if the plaintiff shows good cause for a failure to timely serve, an extension may be granted. While courts generally hold that "[a]n attorney's inadvertence, neglect, mistake or misplaced reliance does not constitute good cause for the purposes of the Rule 4(m)," see, e.g., Howard v. Klynveld Peat Marwick Goerdeler, 977 F.Supp. 654, 658 (S.D.N.Y.1997), aff'd 173 F.3d 844 (2d Cir.1999) (citing McGregor v. United States, 933 F.2d 156, 160 (2d Cir.1991)), courts also suggest that " excusable neglect" can constitute good cause, see, e.g., Zankel v. United States, 921 F.2d 432, 435-36 (2d Cir.1990); McKibben v. Credit Lyonnais, No. 98civ3358 (LAP), 1999 WL 604883, at *2 (S.D.N.Y. Aug. 10, 1999).

In addition, this case is analogous to Zankel v. United States, where the Second Circuit held that failure to properly and timely serve the United States Attorney General did not warrant dismissal, where plaintiff's method of service suffered from a "technical defect." 921 F.2d at 436-38. Specifically, in Zankel, as it was a suit against the United States, the relevant Rule 4 provision required delivery of a copy of the summons and complaint to the United States attorney in the relevant district and mailing (via registered or certified service) of a copy of the summons and complaint to the United States Attorney General; the Circuit found that plaintiff's counsel had accomplished service as to the United States attorney, but that counsel did not attempt to serve the United States Attorney General until more than 120 days had passed. See id. at 434-35. In reversing the district court's dismissal of the complaint pursuant to Rule 4, the Circuit relied on the "technical defect" exception to the provision regarding service on the United States as articulated in a District of Columbia Circuit case, applying the following factors: "If (1) necessary parties in the government have actual notice of a suit; (2) the government suffers no prejudice from a technical defect in service; (3) there is a justifiable excuse for the failure to serve properly; and (4) the plaintiff would be severely prejudiced if the complaint were dismissed." Id. at 436-37 (citing Jordan v. United States, 694 F.2d 833, 836 (D.C.Cir.1982)).

While this case concerns suit against a Connecticut agency, not the United States, and thus a different Rule 4 provision for method of service applies, it is certainly analogous to Zankel (i.e., a suit against a Government entity and a technical defect in the specific method of service required for that entity). And, in this case, plaintiff satisfies the four factors: his counsel represents that the Connecticut Attorney General's office had notice of the suit, as a copy of the summons and complaint was mailed to the Office and she confirmed receipt with a telephone call, see Pl. Opp. at 1; the DOC has not identified any prejudice it will suffer if the suit is permitted to proceed; plaintiff's counsel has a justifiable excuse for her failure to timely properly serve, as already acknowledged by the Court's granting the Motion for Extension of Time, and as she attempted service and was unfamiliar with the Attorney General's service procedures; and plaintiff would be severely prejudiced if this case were dismissed as the statute of limitations has now run, see Pl. Opp. at 2-3. Plaintiff's counsel's justifiable excuse constitutes "excusable neglect," inasmuch as she attempted to serve the summons and complaint, followed up to confirm receipt, re-served, correctly, once informed of the defect, and also filed a Motion for Extension of Time, nunc pro tunc, which the Court granted.

Accordingly, defendant's Motion to Dismiss is DENIED.

S.D. Illinois Holds Second Amended Complaint Relates Back under CAFA; Remands for Lack of Federal Jurisdiction

Per Moll v. Hasbro, Inc., Slip Copy, 2007 WL 2229001 (S.D.Ill . Aug 02, 2007) (NO. 07-0271-DRH):

A case "commences" for purposes of the CAFA when the plaintiff's complaint is filed in state court, not when it is removed. Knudsen v. Liberty Mut. Ins. Co., 411 F.3d at 806. Routine amendments to the complaint relate back to the date of original filing and do not commence new suits. Schorsch v. Hewlett Packard Co., 417 F.3d 749, 751 (7th Cir.2005) (noting that under Illinois law, which applies here, an amendment to a complaint relates back when the original complaint " 'furnished to the defendant all the information necessary ... to prepare a defense to the claim subsequently asserted in the amended complaint' " (citing Boatmen's National Bank of Belleville v. Direct Lines, Inc., 656 N.E.2d 1101, 1107 (Ill.1995)); see also Phillips v. Ford Motor Co., 435 F.3d 785 (7th Cir.2006); Schillinger v. Union Pacific R.R., 425 F.3d 330 (7th Cir.2005). However, "an amended complaint kicks off a new action only if, under the procedural law of the state in which the suit was filed, it does not 'relate back' to the original complaint." Santamarina v. Sears, Roebuck & Co., 466 F.3d 570, 573 (7th Cir.2006) (citations omitted).

Here, Hasbro contends that under CAFA, the Second Amended Complaint, created a new case with new claims, under a different state law (Rhode Island) with brand new plaintiffs seeking to represent a putative class. Plaintiffs argue that CAFA does not apply because the claims contained in the Second Amended Complaint relate back to the original complaint. Based on the following, the Court finds that the claims contained in the Second Amended Complaint relate back to the original Complaint.

As Plaintiffs' original class action Complaint in this case was filed on June 27, 2004, before CAFA's enactment date of February 18, 2005, it is considered "pre-CAFA" and therefore, not within the ambit of CAFA's grant of original jurisdiction. Yet, as stated earlier, Plaintiffs filed their Second Amended Complaint on March 28, 2007, after the enactment date. Therefore, the specific issue the Court must address is whether the Second Amended Complaint relates back to the original complaint or is considered "commencing" a new action in order to trigger the applicability of CAFA.

"The criterion of relation back is whether the original complaint gave the defendant enough notice of the nature and scope of the plaintiff's claim that he shouldn't have been surprised by the amplification of the allegations of the original complaint in the amended one." Santamarina, 466 F.3d at 573 (citations omitted). Under Illinois law, as under federal law, an amendment "relates back" when it arises out of "the same transaction or occurrence set up in the original pleading." 735 ILCS 5/2-616(b); Chandler v. Illinois Central R.R., 207 Ill.2d 331, 346 (Ill.2003); see Fed.R.Civ.P. 15(c) ; Schorsch, 417 F.3d at 751; Delgado-Brunet v. Clark, 93 F.3d 339, 343 (7th Cir.1996) . Illinois courts have also found that "an amendment relates back ... when the original complaint 'furnished to the defendant all the information necessary ... to prepare a defense to the claim subsequently asserted in the amended complaint.' " Boatmen's, 656 N.E.2d at 1107; Pierce v. Joe Keim Builders, Inc., 653 N.E.2d 928, 931 (Ill.App.1995) (citations omitted) ("Thus, an amended complaint relates back only when the original complaint supplies defendant with all of the information necessary to prepare the defense to the claim asserted in the amended pleading ."). The focus is not on the nature of the cause of action pled but on the identity of the transaction, i.e., "... if the defendant has been made aware of the occurrence or transaction which is the basis for the claim, he will be able to defend against the plaintiff's claim, whatever theory it may be predicated upon." Pierce, 653 N.E.2d at 931 (citations omitted). Further, substitution of unnamed class members for named plaintiffs who fall out of the case because of settlement or other reasons is a common and normally an unexceptionable ("routine") feature of a class action litigation in both federal courts and in the Illinois courts." Phillips v. Ford Motor Co., 435 F.3d 785, 787 (7th Cir.2006).

Here, Plaintiffs' amendments adding named plaintiffs/class representatives and withdrawing claims does not appear, at this stage, to substantively alter the class definition or to broaden Hasbro's scope of liability. Instead, it appears that the amendments relate back to the same transaction or series of occurrences as stated in Plaintiff's original Complaint. The lawsuit has the same allegations against the same defendant based on the same product and asserts no new causes of action. Plaintiff's original Complaint clearly alleged multiple states' (including Rhode Island's) consumer fraud act violations. Therefore, new claims were not stated and unnamed parties were merely added as named parties, which is a routine amendment. The issue in Plaintiffs' action remains the same: Hasbro's allegedly defective Electronic Catch Phrase game. Following the Seventh Circuit's ruling in Phillips, Plaintiffs' amendment of the named plaintiffs/class representatives and withdrawing causes of action does not constitute "commencement" of a new action for purposes of triggering CAFA removal. Hasbro had all the information necessary to defend itself and thus the Second Amended Complaint relates back. The Second Amended Complaint represents a normal narrowing of issues in preparation for certification and trial. Therefore, this case must be remanded for lack of federal jurisdiction.

N.D. California Determines Defendant Limited Liability Company's Members Not Incorporated in Same State as Citizen Plaintiff; Grants Removal

Per Washington v. Shell Oil Products US, Slip Copy, 2007 WL 2221078 (N.D.Cal . Aug 02, 2007) (NO. C07 2352 MJJ):

Here, Plaintiff has not filed any documents contesting that his Complaint satisfies the amount in controversy requirement for diversity jurisdiction under 28 U.S.C 1332(a). Therefore, the only issue before the Court is whether there is diversity of citizenship. The "Doe" defendants are not considered in this analysis because § 1441 provides that "for purposes of removal under this chapter, the citizenship of defendants sued under fictitious names shall be discarded." 28 U.S.C. § 1441(a) .

Because Equilon is a limited liability company, Equilon's citizenship for diversity purposes is determined by the citizenship of its members. See Johnson v. Columbia Properties Anchorage, LP, 437 F.3d 894, 899 (9th Cir.2006). Equilon's Opposition and Declaration meets its burden of establishing that at time the Complaint was filed and removal was effected, Equilon and its members were not incorporated in California, and that California was not a principal place of business for any of them. Therefore, Equilon's Opposition and Declaration provides a sufficient factual basis to establish that diversity of citizenship as defined and required in 28 U.S.C. § 1332(c) and 28 U.S.C. 1441(b) is satisfied. Equilon's allegation that Plaintiff is a citizen of California has not been contested by Plaintiff. Accordingly, because Plaintiff and Equilon are not citizens of the same state, there is complete diversity under the language of § 1332.

Plaintiff contends that the Court must look to Plaintiff's Complaint in determining citizenship of the parties, and that the Complaint alleges that Equilon is a resident of or doing business in the State of California. Section 1332(c)(1) provides that, "a corporation shall be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business." 28 U.S.C. § 1332(c)(1). Plaintiff's original state court Complaint alleges that Shell Oil Products U.S. and Does 1 to 20 "were residents or doing business in Contra Costa County." (Notice, Ex. B.) Plaintiff's Complaint does not allege that Equilon, or its members, are incorporated in California, nor that California is a principal place of business for Equilon or its members. Therefore, even taking the facts alleged in the Complaint to be true, Plaintiff has not alleged facts sufficient to establish that Equilon is a citizen of California or that California is its principal place of business under the language of § 1332. Accordingly, Plaintiff's Complaint does not contradict Equilon's evidence that complete diversity exists.

Plaintiff cites Abrego Abrego v. The Dow Chemical Co., 443 F.3d 676 (9th Cir.2006) for the contention that he should be provided an opportunity to conduct discovery to establish that Defendant's principal place of business is California. Plaintiff's contention is unpersuasive. Abrego is inapposite to the instant case, both because the Abrego court addressed an action removed under the Class Action Fairness Act, and because the court recognizes only that "some courts have suggested that it may be appropriate to allow discovery relevant to jurisdictional amount prior to remanding." Id. at 691 (emphasis added). Jurisdictional amount is not in dispute here. Therefore, Plaintiff has not established a basis for conducting jurisdictional discovery on the issue of Equilon's citizenship.

9th Circuit Holds Rule 69(a) Applies in Motion for Attorney's Fees

Per Carnes v. Zamani, 488 F.3d 1057, 07 Cal. Daily Op. Serv. 6419, 2007 Daily Journal D.A.R. 8089 (9th Cir.(Cal.) Jun 04, 2007) (NO. 05-15084):

Rule 69(a) governs the procedure that applies to the enforcement of a money judgment in federal court. It provides, in pertinent part:

The procedure on execution, in proceedings supplementary to and in aid of a judgment, and in proceedings on and in aid of execution shall be in accordance with the practice and procedure of the state in which the district court is held, existing at the time the remedy is sought, except that any statute of the United States governs to the extent that it is applicable.

Fed.R.Civ.P. 69(a). By its plain language, Rule 69(a) applies to "proceedings supplementary to and in aid of a judgment." We have not previously considered whether a post-judgment fee motion constitutes a "proceeding[ ] supplementary to and in aid of a judgment." The Supreme Court "has indicated that motions for costs or attorney's fees are 'independent proceeding[s] supplemental to the original proceeding....' " Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 395, 110 S.Ct. 2447, 110 L.Ed.2d 359 (1990) (alteration in original) (quoting Sprague v. Ticonic Nat'l Bank, 307 U.S. 161, 170, 59 S.Ct. 777, 83 L.Ed. 1184 (1939)). If a motion for fees incurred in obtaining a judgment is considered a supplemental proceeding, it follows that a motion for fees incurred in enforcing a judgment can also be characterized as a supplementary proceeding. Thus, Rule 69(a) applies to the Carneses' fee motion.

Rule 69(a) requires the court to apply state law to "proceedings supplementary to and in aid of a judgment" unless there is a federal statute that would apply. Because there is no applicable federal statute, California procedural law applies to the Carneses' fee motion. Because this is a diversity action, California substantive law also applies to the Carneses' fee motion.

5th Circuit Holds Defendant Did Not Waive Statutory Cap as Affirmative Defense in Sex Discrimination Suit

Per Arismendez v. Nightingale Home Health Care, Inc., --- F.3d ----, 2007 WL 2083710 (5th Cir.(Tex.) Jul 23, 2007) (NO. 06-40593):

Arismendez contends that the employer waived the statutory cap by failing to properly invoke it as an affirmative defense in district court. In a diversity action such as this, substantive state law determines what constitutes an affirmative defense. Lucas v. United States, 807 F.2d 414, 417 (5th Cir.1986). However, "the Federal Rules of Civil Procedure provide the manner and time in which defenses are raised and when waiver occurs." Morgan Guar. Trust Co. of New York v. Blum, 649 F.2d 342, 344 (5th Cir. Unit B 1981). Rule 8(c) of the Federal Rules of Civil Procedure "requires that an affirmative defense be set forth in a defendant's responsive pleading. Failure to comply with this rule, usually results in a waiver." Lucas, 807 F.2d at 417. " 'Where the matter is raised in the trial court in a manner that does not result in unfair surprise, however, technical failure to comply precisely with Rule 8(c) is not fatal.' " Id.(quoting Allied Chem. Corp. v. Mackay, 695 F.2d 854, 855-56 (5th Cir.1983)). More specifically, a defendant does not waive an affirmative defense if it is raised at a " 'pragmatically sufficient time, and [the plaintiff] was not prejudiced in its ability to respond.' " Lucas, 807 F.2d at 418 (quoting Mackay, 695 F.2d at 856) (brackets in opinion).

In Seminole Pipeline v. Broad Leaf Partners, Inc., a Texas Court of Appeals held that the statutory cap in Chapter 41 was not an affirmative defense. 979 S.W.2d 730, 759 (Tex.App.-Houston [14th Dist.] 1998). The court explained that the cap automatically applied and "[b]ecause the defendants had nothing to prove, they had nothing to plead." Id. Here, if the statutory cap is not an affirmative defense and automatically applies, Arismendez's claim of waiver is without merit. However, another Texas Court of Appeals has opined that "[w]here maximum damages are provided in statutes in Texas, and a defendant wants to rely on the cap, it is considered a defense that must be plead and proved." Shoreline, Inc., v. Hisel, 115 S.W.3d 21, 25 (Tex.App.-Corpus Christi 2003) (citing inter alia § 41.008 ).

We need not determine whether the relevant statutory caps constitute affirmative defenses under Texas law. Assuming arguendo that the statutory caps are affirmative defenses, Arismendez has not shown that Nightingale waived the defense. In a Joint Pretrial Order, Arismendez referred to a statutory cap on damages. Although the employer did not plead a statutory cap in its answer, the employer did raise it prior to entry of judgment. Additionally, there were no factual issues to determine. While Arismendez asserts that Nightingale failed to prove the number of employees it had during the relevant time frame, that fact is irrelevant under the cap in Chapter 41.

Further, Arismendez has not shown how she was prejudiced by the delay in raising the statutory cap. We conclude that the employer raised the cap at a pragmatically sufficient time, and Arismendez was not prejudiced. The district court properly ruled that the employer had not waived the statutory cap.

5th Circuit Holds There is Genuine Issue of Material Fact as to Whether Defendant Properly Mailed Notice; Reverses Summary Judgment

Per Custer v. Murphy Oil USA, Inc. , --- F.3d ----, 2007 WL 2095814 (5th Cir.(La.) Jul 24, 2007) (NO. 06-30672):

Because Murphy attempts to prove that it mailed the notice without providing any direct evidence of mailing, it relies on circumstantial evidence, namely that it sent the December 2002 notice through Murphy's normal internal mailing procedures. See, e.g., Wells Fargo Business Credit v. Ben Kozloff, Inc., 695 F.2d 940, 944 (5th Cir.1983) ("Placing letters in the mail may be proved by circumstantial evidence, including customary mailing practices used in the sender's business."); Myer v. Callahan, 974 F.Supp. 578, 584 n. 7 (E.D.Tex.1997) ("Proof of mailing may also be established if the letter was shown to have been sent through a systematic process at the clerk's office or through records at the clerk's office.") (citing Knickerbocker Life Ins. Co. v. Pendleton, 115 U.S. 339, 345-46, 6 S.Ct. 74, 29 L.Ed. 432 (1885); Myers v. Moore-Kile Co., 279 F. 233, 234-36 (5th Cir.1922)). These cases establish only that the fact finder may use the circumstantial evidence to infer that a letter placed in a company's internal mailing system was properly placed in the mail. Such circumstantial evidence may in some cases be sufficient to justify a grant of summary judgment, but not in this case where the plaintiffs have presented more than a mere assertion of non-receipt and the defendants have presented no evidence about the reliability of its internal mailing procedures.

Although the plaintiff ultimately bears the burden of demonstrating that Murphy failed to "use measures reasonably calculated to ensure actual receipt" of the notice, Murphy, as the party moving for summary judgment, bears the burden of demonstrating that there is no genuine issue of material fact. See Harvill v. Westward Commc'ns., L.L.C., 433 F.3d 428, 433 (5th Cir.2005) ("The moving party has the burden of demonstrating that there are no genuine issues of material fact in dispute."). The plaintiffs have alleged they did not receive the notice, and that allegation is supported by the other Meraux shift supervisors' testimony that they could also not recall receiving the notice and that they regularly retain such notices but could not locate the notice in their records. Murphy has produced neither testimony or business records that the notice was sent to individuals at the Meraux plant nor any individual at the Meraux plant claiming to have received the notice. Taken together, this record demonstrates that a reasonable jury may think that, at the very least, Murphy did not distribute the December 2002 notice using methods reasonably calculated to ensure receipt for the Plan participants at the Meraux plant-so there is a genuine issue of material fact as to whether Murphy properly mailed the December 2002 notice to Custer. Therefore, we reverse the district court's grant of summary judgment on this issue.

11th Circuit Holds Notice Provided to Defendants in Class Action Suit Was Adequate

Per Adams v. Southern Farm Bureau Life Ins. Co., --- F.3d ----, 2007 WL 2119182 (11th Cir.(Ga.) Jul 25, 2007) (NO. 06-13162):

The district court found that the notice provided to the appellants in this case was adequate and thorough, and that it comported with both the requirements of Rule 23 and of due process. FN5 We agree. First, the notice was thorough, consisting as it did of 48-pages of explanatory text. Cf. Twigg, 153 F.3d at 1228-1229 (finding a two-page notice with a vague, one sentence description of the type of claim involved, to be violative of due process). Second, the language of the notice was clear and comprehensible, and it adequately described both the substantive claims at issue in the Adams Class Action and the "information reasonably necessary to make a decision to remain a class member and be bound by the final judgment," such as the relief available, the steps necessary to opt out, and the implications of remaining a member of the class. See Nissan, 552 F.2d at 1104-05. Finally, we find, as the district court did, that the steps taken by Southern Farm in distributing the notice--via multiple first class mailings and publication in a national newspaper--as well as providing a telephone number, website, and mailing address to field queries from class members, constituted "the best notice practicable under the circumstances." See Fed.R.Civ.P. 23(c).

FN5. Our case law makes clear that Rule 23's mandate that absentee class members be given "the best notice practicable under the circumstances," Fed.R.Civ.P. 23(c), is consistent with the due process requirements of the Constitution, and, in fact, that Rule 23 goes beyond those requirements. Nissan, 552 F.2d at 1103-1104 (citation omitted).

The appellants argue that their case is analogous to Twigg, in which we concluded that the notice afforded class members was insufficient because it did not adequately describe the type of claim involved in the earlier class action. Twigg, 153 F.3d at 1228-1230. In Twigg, the notice had indicated--in a pithy, one sentence description--that the class action involved "unnecessary and/or improper repairs" performed by the defendant, Id. at 1229-30, that is, repairs that were performed that were not needed. The appellant's action in a later suit, however, was based on services for which he had paid, but which had not been performed. Id. at 1224. Because we found that the notice in the earlier action had failed to advise the appellant whether "claims like his were being litigated [or] had been settled" in the earlier action, we concluded that permitting res judicata to bar the appellant's present claims would be inconsistent with due process. Id. at 1228-29.

Strong Showing on Merits Not Sole Factor To Get Statute Enjoined Pending Appeal

Per BNA's U.S. Law Week, Vol. 76, No. 7 (Aug. 21, 2007):

A plaintiff seeking to enjoin enforcement of a state statute pending appeal need not make a strong showing of likely success on the merits, but only that the appeal has some merit and that the balance of harms is in its favor, the U.S. Court of Appeals for the Seventh Circuit ruled Aug. 6 (Cavel International Inc. v. Madigan, 7th Cir., No. 07-2658, 8/6/07).

This "sliding scale" standard is the same one used by district courts and courts of appeals adjudicating motions for preliminary injunctions and stays of district court rulings pending appeal, Judge Richard A. Posner said, citing Fed. R. App. P. 8(a)(1)(C), (2), and Hilton v. Braunskill, 481 U.S. 770 (1987). He said that the plaintiff here "has a good enough case on the merits for the balance of harms to entitle it to an injunction pending an expedited appeal[.]"

But Chief Judge Frank H. Easterbrook argued in dissent that this misread Hilton, which he said equated stays of district court orders and injunctions pending appeal and required a "strong showing" that the plaintiff is likely to prevail for both.

The plaintiff, whose slaughterhouse is in Illinois, produces horse meat for human consumption and exports its entire output to Europe, where it is considered a delicacy. It sought an injunction against a recent amendment to the Illinois Horse Meat Act, 225 Ill. Comp. Stat. 635/1.5, which prohibits slaughtering a horse in the state for human consumption or knowingly importing or exporting horse meat for human consumption.

The district court rejected the plaintiff's argument that the statute violates the commerce clause, and denied its motion for an injunction against enforcement of the statute pending appeal.

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2nd Circuit Holds that Right of Amendment in Rule 15(a) Is Subject to District Court's Discretion to Limit the Time for Amendments under Rule 16(b)

Per Kassner v. 2nd Avenue Delicatessen Inc., --- F.3d ----, 2007 WL 2119769 (2nd Cir.(N.Y.) Jul 24, 2007) (NO. 05-4237-CV):
We turn next to the district court's denial of plaintiffs' cross-motion to amend their complaint, which we review for abuse of discretion. Dougherty, 282 F.3d at 87; see Parker v. Columbia Pictures Indus., 204 F.3d 326, 339-40 (2d Cir.2000). In doing so, we review de novo any conclusions of law. Dougherty, 282 F.3d at 87. Upon de novo review, we conclude that the district court erred in ruling that the proposed amendment to the complaint would have been futile.

Rule 15(a) of the Federal Rules of Civil Procedure provides in the first sentence that "[a] party may amend the party's pleading once as a matter of course at any time before a responsive pleading is served...." Fed.R.Civ.P. 15(a). The second sentence of Rule 15(a) provides that "[o]therwise a party may amend the party's pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires." Id.

At the time that plaintiffs moved to amend their complaint, defendants had not filed an answer. Defendants' motion to dismiss, because it was a motion, not a pleading, was not a "responsive pleading" within the meaning of Rule 15(a) . See Barbara v. New York Stock Exch., Inc., 99 F.3d 49, 56 (2d Cir.1996). The threshold question, therefore, is whether the district court was required to accept the proposed amended complaint because the plaintiffs were allowed by the first sentence of Rule 15(a) to amend the complaint as a matter of course. We conclude that the district court, because of the effect of Rule 16(b), was not so required.

Although Rule 15(a) governs the amendment of pleadings, Rule 16(b) also may limit the ability of a party to amend a pleading if the deadline specified in the scheduling order for amendment of the pleadings has passed. See Fed.R.Civ.P. 16(b). Under Rule 16(b), a party may obtain a modification of the scheduling order only "upon a showing of good cause." Id. The record in this case shows that plaintiffs filed their cross-motion to amend the complaint on March 4, 2005, more than one month after February 1, 2005, the date specified in the Rule 16(b) scheduling order as the final date for amendment of the pleadings.

In Parker, we addressed the relationship between the standard imposed by the second sentence of Rule 15(a), i.e., the "freely given when justice so requires" standard, and the "good cause" standard of Rule 16(b). 204 F.3d at 339-40. We held in Parker that a district court, despite the standard of the second sentence of Rule 15(a), does not abuse its discretion in denying leave to amend the pleadings where the moving party has failed to establish good cause, as required by Rule 16(b), to amend the pleadings after the deadline set in the scheduling order. Id. We stated with respect to the Rule 16(b) standard, " 'good cause' depends on the diligence of the moving party." Id. at 340 (quoting Fed.R.Civ.P. 16(b)).

However, we have not previously decided whether a party's right to amend a pleading once "as a matter of course," as provided in the first sentence of Rule 15(a) , may be qualified by the trial court's general discretion to limit, by means of a scheduling order entered under Rule 16(b), the time during which the pleadings may be amended. Because the first sentence of Rule 15(a) allows a party to amend a pleading "once as a matter of course at any time before a responsive pleading is served," it may be argued that the rule creates a right to amend pleadings that is not qualified by the district court's discretion to impose time restrictions under Rule 16 . Fed.R.Civ.P. 15(a) (emphasis added). As we discussed in Parker, Rule 16(b) expressly provides that a scheduling order is to limit the time for amendment of the pleadings and, in so doing, "is designed to offer a measure of certainty in pretrial proceedings"; we cited therein the advisory committee notes to the 1983 amendment to Rule 16, which discussed subsection (b). Parker, 204 F.3d at 339-40. Although the Rule 16(b) scheduling order, in the district court's discretion, may impose various time limits for pre-trial proceedings (including time limits on "any other matters appropriate in the circumstances of the case"), amendment of the pleadings is one of four time limits that the trial court generally must include in a Rule 16(b) scheduling order. Fed.R.Civ.P. 16(b). The advisory committee notes provide that "[i]tem (1) assures that at some point both the parties and the pleadings will be fixed, by setting a time within which joinder of parties shall be completed and the pleadings amended." Fed.R.Civ.P. 16 Advisory Committee Notes, 1983 Amendment (discussing subsection (b)). This objective would be frustrated by an interpretation of the first sentence of Rule 15(a) that precludes a district court from exercising any discretion to specify the time period during which a party may effect the first amendment of its complaint prior to the serving of a responsive pleading. Rule 16(b) , in allowing modifications of scheduling orders only for good cause, provides the district courts discretion to ensure that limits on time to amend pleadings do not result in prejudice or hardship to either side. For these reasons, we hold that amendment of a pleading as a matter of course pursuant to Rule 15(a) is subject to the district court's discretion to limit the time for amendment of the pleadings in a scheduling order issued under Rule 16(b).

5th Circuit Holds State's Interests Adequately Represented by Levee Board; Denies Motion to Intervene

Per Haspel & Davis Milling & Planting Co. Ltd. v. Board Of Levee Commissioners of The Orleans Levee Dist. and State Of Louisiana, --- F.3d ----, 2007 WL 2079880 (5th Cir.(La.) Jul 23, 2007) (NO. 07-30086):
In the district court, the State filed a motion to intervene pursuant to, inter alia, Fed. R. Civ. Proc. 24 for the limited purpose of enforcing Louisiana's anti-seizure provisions found in La. Const. art. XII, § 10(C) and La.Rev.Stat. Ann. § 13:5109(B)(2). The district court denied the State's motion, concluding that the State did not have an unconditional right to intervene, and that any interest the State had was adequately represented by the existing parties.

. . .

Fed. R. Civ. Proc. 24(a)(1) allows intervention of right "when a statute of the United States confers an unconditional right to intervene." The State argues that 28 U.S.C. § 2403(b) confers upon it an unconditional right to intervene in the instant suit because the constitutionality of La. Const. art. XII, § 10(C) and La.Rev.Stat. Ann. § 13:5109(B)(2) were called into question by the landowners' efforts to seize public property and funds.

We agree with the district court that this case does not challenge or question the constitutionality of La. Const. art. XII, § 10(C) or La.Rev.Stat. Ann. § 13:5109(B)(2), and thus, 28 U.S.C. § 2403(b) does not provide the State an unconditional right to intervene. In granting the landowners' requests for writs of seizure and subsequently denying the Levee Board's motion to vacate such writs, the district court merely found the relevant provisions inapplicable to the instant case, thus raising only questions of the proper interpretation of Louisiana law, and not its constitutionality.

The district court correctly concluded that 28 U.S.C. § 2403(b) does not provide the State an unconditional right to intervene.

. . .

The landowners make two arguments in support of the district court's denial of the State's motion to intervene of right under Fed. R. Civ. Proc. 24(a)(2): (1) the motion was untimely; and (2) the State's interests were adequately represented by the Levee Board. Because we conclude that the State's interests were adequately represented by the Levee Board, we do not consider the timeliness issue.

The burden of establishing inadequate representation is on the applicant for intervention. This burden is "minimal" and "is satisfied if the applicant shows that representation of his interest 'may be' inadequate ...." However, "it cannot be treated as so minimal as to write the requirement completely out of the rule." In addition, "when the party seeking to intervene has the same ultimate objective as a party to the suit, the existing party is presumed to adequately represent the party seeking to intervene unless that party demonstrates adversity of interest, collusion, or nonfeasance."

The State argues that it is not seeking "the same ultimate objective" as the Levee Board because its objective is more expansive in that the State is seeking to ensure that Louisiana's anti-seizure provisions are uniformly applied to prevent the seizure of public property and funds in satisfaction of any judgment, and not merely a judgment against the Levee Board. Nevertheless, even assuming that the State's interest is broader than that of the Levee Board, the more narrow issue regarding execution of the judgment against the Levee Board is the only matter currently before us. Thus, the Levee Board and the State have the same ultimate objective in this case.

The State does not allege collusion, nonfeasance, or adversity of interest. The State only asserts that the Levee Board cannot adequately represent its interests because it is now dissolved and, even when it was in existence, it had no juridical authority to represent the State because it was a political subdivision and not an agency of the State. Contrary to the State's assertions, the State concedes that the Levee Board "has very able and persuasive counsel." Furthermore, even assuming that the Levee Board does not have the "juridical" authority to represent the State, when evaluating a motion to intervene, our concern is whether the Levee Board adequately represents the State's interests, and not whether the Levee Board is actually representing the State as a party (which the Levee Board does not purport to do). In addition, because we conclude that it was error for the district court to render judgment against the Levee Board, we do not reach the seizure issue which is the concern of the State.

The district court properly concluded that the Levee Board adequately represents the State, and thus, we affirm the court's order denying the State's motion to intervene as a matter of right pursuant to Fed. R. Civ. Proc. 24(a)(2).

S.D.N.Y. Holds Plaintiff Failed to Show Good Cause For Delay in Effecting Service

Per In re Teligent Services, Inc., --- B.R. ----, 2007 WL 1975444 (S.D.N.Y. Jul 06 , 2007) (NO. 01-12974, 03-03378, 05 CIV 7277 SAS):

Savage sought to serve Wiltel seventeen months after filing the original complaint and thirteen months after the 120 service period had expired. Federal Rule of Civil Procedure 4(m) allows for a plaintiff to serve a defendant after the 120 day service period in certain circumstances. . . .

. . . Savage had the burden of proving good cause for the thirteen month delay in service. In an attempt to do so, Savage claims that Teligent's records did not reflect Wiltel and NextiraOne as distinct entities. Savage only found one vendor number for all the Williams entities. Savage also points out that the various names and addresses on the checks and the overlapping names and roles of each Williams entity accounted for Savage's confusion. Some initial confusion on the part of Savage may have been justified-Savage was responsible for avoiding thousands of payments made by Teligent during the preference period, and each Williams entity's name is fairly similar.

However, the possible confusion by Savage does not excuse a thirteen month delay in service on Wiltel. Three of the checks did have Wiltel's former name on them, four of the checks were addressed directly to Witlel, and all of the checks had Wiltel's address somewhere on the check. Despite Savage's representation to the contrary, it did understand Wiltel to be a separate creditor from NextiraOne. Indeed, Savage was pursuing a separate preference period claim against Wiltel at the time of this action. Using Teligent's records, Savage could have matched the addresses on the checks with Teligent's records to discover that at least four of the five were sent to Wiltel.

Savage simply did not perform a diligent search of the records before serving NextiraOne rather than Wiltel. Early in the proceedings Savage expressed its confusion regarding which Williams defendant to serve for each Preference Period claim, as evidenced by the email communications between Savage and Turner. In its confusion, Savage could have filed for an extension of service under Federal Rules of Civil Procedure 6(b), but it did not do so. Given the record, the Bankruptcy Court did not abuse its discretion in holding that Savage's efforts were unreasonable.

On the other hand, Savage will be prejudiced by the court's decision to dismiss the claim against Wiltel because the statute of limitations has run on Savage's claims against Wiltel. Courts have often attempted to avoid dismissal based on late service where a refiling is prohibited by statute. But the Bankruptcy Court properly balanced this prejudice against Savage's lack of diligence and the prejudice to Wiltel and concluded that the prejudice to Savage did not outweigh these other factors. In short, Savage did not show good cause for delaying proper service on Wiltel for seventeen months.