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Alabassi v. Columbia Insurance Co.

United States District Court, D. Colorado

January 30, 2018

OMAR ALABASSI, Plaintiff,
v.
COLUMBIA INSURANCE COMPANY, Defendant.

          RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

          Michael E. Hegarty, United States Magistrate Judge

         Plaintiff, Omar Alabassi, owns a limousine service and claims that on March 23, 2016, while driving his personal vehicle to pick up some clients at the airport (his company vehicles were, apparently, buried in snow), he was involved in a hit-and-run collision in which his vehicle was damaged and he was injured. Plaintiff contacted his personal insurance agent at Allstate and, eventually, worked out a settlement in which Allstate paid Plaintiff benefits for damage to his car. Plaintiff also contacted the Defendant, his commercial insurance provider, seeking benefits for injuries caused by the uninsured motorist. Defendant initially denied Plaintiff's claim, then after this lawsuit was filed, paid Plaintiff the maximum benefits allowed under the policy for medical and uninsured motorist claims.

         Here, following the thrice-extended deadline for joinder of parties and amendment of pleadings, Plaintiff seeks to amend his Amended Complaint to allege negligence against two “new” defendants, his insurance agent and insurance brokerage firm. Mot. 1. The Court finds Plaintiff's amendments to be untimely and unduly prejudicial at this stage of the litigation and, thus, the Court recommends that the Honorable Raymond P. Moore deny the Plaintiff's motion.

         I. Background

         Plaintiff filed this action against the Defendant in the Arapahoe County District Court, Colorado on February 23, 2017 and, based on diversity jurisdiction, the Defendant removed the action to this Court on March 24, 2017. ECF No. 1. This Court held a scheduling conference on May 1, 2017 at which the Court agreed with the parties' proposed case management deadlines, including a deadline of June 12, 2017 for joinder of parties and amendment of pleadings (“amendment deadline”).

         On June 9, 2017, the parties jointly sought and were granted an extension of the amendment deadline to July 7, 2017 to allow Plaintiff's counsel sufficient time to review Defendant's questions concerning Plaintiff's answer to the counterclaims. ECF Nos. 45, 48. On July 6, 2017, the parties jointly sought and were granted a second extension of the amendment deadline to September 1, 2017 to allow sufficient time for the taking of the Plaintiff's deposition on August 3, 2017 and for the setting and taking of the claims adjustor's deposition, which needed to be rescheduled because he became “gravely ill, ” and which needed to occur (at the Plaintiff's request) at least two weeks before the deadline. ECF Nos. 49, 51. On September 1, 2017, the parties sought and were granted a third extension of the amendment deadline to October 12, 2017 because, due to the claims adjustor's paternity leave and Plaintiff's counsel's litigation scheduling conflicts, the adjustor's deposition was not set until September 28, 2017. ECF Nos. 52, 55.

         Meanwhile, Defendant filed a motion to amend its Answer to add certain affirmative defenses in light of discovery as to the Plaintiff's claims. ECF No. 53. After briefing, the Court granted the motion and the Amended Answer was filed on October 30, 2017. ECF Nos. 74, 75. In addition, the Court grant two joint motions to extend the expert disclosure deadlines. ECF Nos. 62, 73. However, the discovery cutoff stayed the same at December 19, 2017. ECF No. 40.

         Plaintiff filed the present motion on November 6, 2017 arguing that he learned new information during discovery leading to his requested amendments. Specifically, Plaintiff contends that during his own deposition on August 3 and August 9, his testimony revealed that the proposed new Defendants, T.I.B. Insurance Brokers and Josef Ortiz, “did not make a sufficient offer of UM coverage to Plaintiff” and did not follow through on a promise to procure coverage for vehicles that Plaintiff rented, leased, or borrowed for his business. Mot. 5. Furthermore, the insurance application allegedly reveals inconsistencies demonstrating additional negligence on the part of these proposed parties. Id. 6. Plaintiff asserts that it was not until he took the claims adjustor's deposition on September 28, 2017 that “[i]t became clear . . . that T.I.B. and Mr. Ortiz played a larger role in the sale of insurance to Plaintiff than originally assumed.” Id. 6-7. Plaintiff states that he then obtained the adjustor's deposition transcript and “reviewed the evidence with a Colorado licensed insurance producer on October 27, 2017 to discuss whether T.I.B.'s and Mr. Ortiz's conduct met industry standard and to comply with the requirements of C.R.S. § 13-20-602, ” who then determined that the proposed defendants' conduct “fell below the standard of care for Colorado insurance producers.” Id. 7.

         II. Legal Standards

         Amendment to a pleading is governed by Fed.R.Civ.P. 15. Rule 15, which provides that, following a 21-day period for service of the complaint or service of a responsive pleading or Rule 12 motion, a party may amend its complaint only by leave of the court or by written consent of the adverse party. Fed.R.Civ.P. 15(a). Rule 15 instructs courts to “freely give leave when justice so requires.” Id. Nevertheless, denying leave to amend is proper if the proposed amendments are unduly delayed, unduly prejudicial, futile, or sought in bad faith. Foman v. Davis, 371 U.S. 178, 182 (1962); see also Frank v. U.S. West, Inc., 3 F.3d 1357, 1365 (10th Cir. 1993).

         In the Tenth Circuit, untimeliness alone may be a sufficient basis for denying a party leave to amend. See Duncan v. Manager, Dep't of Safety, 397 F.3d 1300, 1315 (10th Cir. 2005); Hayes v. Whitman, 264 F.3d 1017, 1026 (10th Cir. 2001). The important inquiry is not simply whether Plaintiff has delayed, but whether such delay is undue. Minter v. Prime Equip. Co., 451 F.3d 1196, 1206 (10th Cir. 2006). Delay is undue “when the party filing the motion has no adequate explanation for the delay, ” Frank, 3 F.3d at 1365-66, or when “the party seeking amendment knows or should have known of the facts upon which the proposed amendment is based but fails to include them in the original complaint.” Las Vegas Ice & Cold Storage Co. v. Far West Bank, 893 F.2d 1182, 1185 (10th Cir. 1990) (quoting State Distribs., Inc. v. Glenmore Distilleries Co., 738 F.2d 405, 416 (10th Cir. 1984)).

         III. Analysis

         Because Plaintiff filed his motion after the amendment deadline, Defendant is correct that granting Plaintiff's motion pursuant to Rule 15(a) would require a modification of the Scheduling Order. See Gorsuch, Ltd., B.C. v. Wells Fargo Bank Ass'n, 771 F.3d 1230, 1240 (10th Cir. 2014). Thus, the Court employs a two-step analysis. First, the Court evaluates whether Plaintiff demonstrates good cause allowing modification of the Scheduling Order; if Plaintiff shows good cause, he must also meet the requirements of Fed.R.Civ.P. 15(a). Id.

         A. Good Cause for ...


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