United States District Court, D. New Mexico
JOSHI TECHNOLOGIES INTERNATIONAL, INC., Plaintiff/Counterdefendant,
CHI ENERGY, INC., Defendant/Counterclaimant.
MEMORANDUM OPINION AND ORDER
matter comes before the Court upon Joshi Technologies
International, Inc.'s (Joshi) Motion to Amend Complaint
and Answer to Counterclaim (Motion to Amend), filed February
28, 2019. (Doc. 132). Chi Energy, Inc. (Chi) filed a response
on March 14, 2019, and Joshi filed a reply on March 27, 2019.
(Docs. 133 and 137). Having considered the Motion to Amend,
the accompanying briefing, and the proposed pleadings, the
Court denies the Motion to Amend.
Scheduling Order in this matter provided that Joshi file
motions to amend pleadings by December 31, 2015. (Doc. 17).
Indeed, Joshi filed an “Amended Complaint for Breach of
Contract, Fraud in the Inducement, and Unjust
Enrichment” (First Amended Complaint) on July 31, 2015.
January 29, 2016, Chi filed its Second Amended Answer and
First Amended Counterclaim. (Doc. 22). On February 11, 2016,
Joshi filed its Amended Answer to First Amended Counterclaim
in which Joshi raised several affirmative defenses. (Doc.
now moves to file a Second Amended Complaint to add Count IV,
a reformation claim premised on mutual mistake of fact. Joshi
also moves to file a Second Amended Answer to First Amended
Counterclaim to add a mutual mistake of fact affirmative
notes that the existing First Amended Complaint
“clearly sets forth the facts giving rise to a claim
for reformation as a result of unilateral or mutual
mistake.” (Doc. 132) at 2. Joshi contends
“[t]here would be no need for additional discovery, and
therefore no prejudice to Chi” because “the facts
underlying Joshi's reformation claim and affirmative
defense have already been fully examined during discovery in
this lawsuit.” Id. at 2-3. Joshi further asserts
that allowing these amendments would not affect a trial date.
opposes the Motion to Amend in its entirety. Chi correctly
notes that Joshi violated the Scheduling Order's December
31, 2015, deadline for filing motions to amend pleadings when
it filed the Motion to Amend. Chi argues that Joshi has
failed to meet the good cause requirement of Fed.R.Civ.P.
16(b)(4) to modify the Scheduling Order's deadline for
filing motions to amend pleadings. Chi further argues that
the Court should not grant the Motion to Amend under
Fed.R.Civ.P. 15(a), because Joshi unduly delayed filing the
Motion to Amend. Finally, Chi asserts that granting the
Motion to Amend will prejudice Chi.
a scheduling order deadline, a party seeking leave to amend
must demonstrate (1) good cause for seeking modification [of
the scheduling order] under [Rule] 16(b)(4) and (2)
satisfaction of the Rule 15(a) standard” to amend the
pleading. Husky Ventures, Inc. v. B55
Investments, Ltd., 911 F.3d 1000, 1019 (10th Cir.
2018) (citation omitted). The Tenth Circuit recently
“Rule 16(b)(4) is arguably more stringent than Rule 15,
permitting scheduling order amendments ‘only for good
cause and with the judge's consent.'” “In
practice, [the Rule 16(b)(4)] standard requires the movant to
show the ‘scheduling deadlines cannot be met despite
[the movant's] diligent efforts.'”
Id. at 1019-20 (citations omitted). A Rule 16(b)(4)
movant cannot establish diligence and good cause if the
movant “knew of the underlying conduct but simply
failed to raise [its] claims.” Id. at 1020
(citation omitted). The movant must “provide an
adequate explanation for any delay….”
Id. (citation omitted). “If good cause is not
shown under Rule 16(b)(4) to modify the scheduling order, the
district court need not consider whether the requirements for
leave to amend under [Rule] 15(a) have been satisfied.”
Perez v. Denver Fire Dep't, 724 Fed.Appx. 646,
649-50 (10th Cir. 2018).
reply, Joshi argues that Chi's Opposed Motion for
Reconsideration of Summary-Judgment Rulings (Doc. 131), filed
February 28, 2019, provides good cause for modifying the
Scheduling Order and permitting Joshi's amendment of the
pleadings. Nonetheless, Joshi reiterates that it “has
already pleaded the elements of and remedy for mutual
mistake.” (Doc. 137) at 1-2. Joshi, therefore, admits
it knew of the underlying conduct for the reformation claim
and mutual mistake of fact affirmative defense when it filed
the July 2015 First Amended Complaint and the February 2016
Amended Answer to First Amended Counterclaim. Thus, Joshi
could have raised the reformation claim in July 2015 and
raised the mutual mistake of fact affirmative defense in
February 2016. Considering this prior knowledge of the
underlying conduct supporting the Motion to Amend, Joshi does
not adequately explain why it delayed filing the Motion to
Amend until now. Hence, Joshi has not demonstrated good cause
under Rule 16(b)(4) to modify the Scheduling Order's
deadline for filing motions to amend pleadings. The Court,
therefore, will deny the Motion to Amend as untimely under
the Scheduling Order.
ORDERED that Joshi's Motion to Amend Complaint and Answer