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Toren-Edmiston v. Wells Fargo & Co.

United States District Court, D. Colorado

November 4, 2019




         This matter comes before the court for recommendation on Plaintiff Carol Toren-Edmiston's (“Plaintiff” or “Ms. Toren-Edmiston) Motion for Leave to Amend and Supplement the Pleadings (the “Motion to Amend” or “Motion”), filed August 14, 2019. [#65]. The undersigned Magistrate Judge considers the Motion pursuant to 28 U.S.C. § 636(b) and the Memorandum dated August 14, 2019 [#66]. This court concludes that oral argument will not materially assist in the resolution of this matter. Accordingly, having reviewed the Motion and associated briefing, the applicable case law, and being otherwise advised in its premise, this court respectfully RECOMMENDS that the Motion to Amend be DENIED.


         This civil action arises out of an employment dispute between Ms. Toren-Edmiston and Defendants Wells Fargo & Company and Wells Fargo Bank N.A. (collectively, “Wells Fargo” or “Defendants”). See [#26 at ¶¶ 1-5]. Plaintiff began her employment in or around 1985 with one of Wells Fargo's predecessors as a Regulatory Reporting Specialist; she held several different positions with Wells Fargo and its predecessors and received several promotions along the way, including as manager of the Non-Performing Home Equity Portfolio-“a portfolio that held $11.8 billion in equity.” See [id. at ¶¶ 12-19]. In 2008, Ms. Toren-Edmiston left Wells Fargo for a position with CitiMortgage, Inc., where she again received several promotions and held leadership roles, before returning to Wells Fargo as the Head of Centralized Mortgage Retail in 2013. See [id. at ¶¶ 23-26]. Upon returning to Wells Fargo, Plaintiff oversaw 600 employees and led several of Wells Fargo's departments. See [id. at ¶¶ 27-31].

         Valuing risk management, which Wells Fargo defines as “business risks includ[ing] but [] not limited to credit, market, operational, regulatory compliance, strategic, and reputation risks, ” [#77-1 at 62], “Ms. Toren-Edmiston created the Raise Your Hand Mailbox for the specific purpose of addressing risk management issues from all levels throughout the organization, ” [#26 at ¶¶ 46-47]. “While previous supervisors saw Ms. Toren-Edmiston's willingness to speak up as a strength for the company, her supervisor Liz Bryant and those to whom Ms. Bryant reported viewed it as a liability.” [Id. at ¶ 50]. For instance, following Ms. Toren-Edmiston's attempts (which were successful) to implement new compensation metrics to replace the “customer loyalty metric” that Ms. Toren-Edmiston believed “created incentives for loan officers to engage in questionable behavior in order to obtain larger bonuses, ” Ms. Bryant issued Plaintiff negative feedback and instructed Plaintiff to terminate the Raise Your Hand Mailbox. See [id. at ¶¶ 51-59].

         Ms. Toren-Edmiston's additional suggestions for improving risk management went unheeded, and thus she began the process for retirement in or about December 2017. See [id. at ¶¶ 61-79; #77-1 at 194-95]. Ms. Toren-Edmiston worked with Wells Fargo's Retirement Service Center over the next several months; however, Wells Fargo terminated Plaintiff via phone call with Ms. Bryant on February 5, 2018, despite positive performance reviews from 2015 and 2016. See [#26 at ¶¶ 79-99, 100-106; #65-1 at ¶ 2]. According to Ms. Toren-Edmiston, Ms. Bryant criticized Plaintiff's management of risk in her own departments, “accused Ms. Toren-Edmiston of alleged misconduct regarding the Raise Your Hand Mailbox, ” and refused Ms. Toren-Edmiston's request to retire rather than be terminated. See [#26 at ¶¶ 86-99, 125; #65-1 at ¶ 4].

         Ms. Toren-Edmiston contends that Wells Fargo never provided her with a reason for her termination, that is until August 2019 when Wells Fargo informed Plaintiff that she had violated its Risk Management and Accountability policy and Code of Ethics and Business Conduct by creating the Raise Your Hand Mailbox. See [#26 at ¶ 99; #65-1 at ¶¶ 4-16]. Ms. Toren-Edmiston unsuccessfully challenged her termination internally with Wells Fargo, see [#76-2; #76-3; #77-2], and despite demands for her roughly $500, 000 of earned yet unpaid bonuses and stock options (“RSRs”), Wells Fargo refused to pay Plaintiff any bonuses or RSRs for 2017 following her termination. See [#26 at ¶¶ 107-24, 127-28; #65-1 at ¶¶ 9-12; #76-2].

         Plaintiff then initiated this civil action on or about February 18, 2019, by filing her Complaint in the Boulder County District Court, asserting claims against Defendants for wrongful discharge in violation of public policy (“wrongful discharge”), promissory estoppel, unjust enrichment, and violations of the Colorado Wage Claim Act, Colo. Rev. Stat. § 8-4-109. See generally [#1; #3]. Defendants removed this civil action to this District pursuant to 28 U.S.C. § 1332 on March 15, 2019. See [#1].

         In response to Defendants' Motion to Dismiss Plaintiff's wrongful discharge, promissory estoppel, and unjust enrichment claims, Ms. Toren-Edmiston filed her operative First Amended Complaint on April 30, 2019. [#26]. Her First Amended Complaint asserts claims against Defendants for wrongful discharge, promissory estoppel, unjust enrichment, interference with benefits in violation of the Employment Retirement Income Security Act of 1974 (“ERISA”) (pleaded in the alternative pursuant to Rule 8(d)(2) of the Federal Rules of Civil Procedure), and willful withholding of wages in violation of the Colorado Wage Claim Act. See generally [id.]. Defendants have since moved to dismiss the First Amended Complaint in its entirety, which remains pending before the presiding judge, the Honorable Philip A. Brimmer. See [#49].

         Relevant here, this court conducted a Scheduling Conference on May 14, 2019, at which the undersigned set June 14, 2019 as the amendment of pleadings deadline and November 22, 2019 as the discovery cut-off. See [#32 at 9]. Now, Plaintiff moves to amend her First Amended Complaint to “amend and supplement the pleadings to add a claim for breach of the duty of good faith and fair dealing” (pleaded in the alternative) concerning Defendants' withholding of Ms. Toren-Edmiston's 2017 bonuses and RSRs. See [#65]. Defendants oppose the Motion, arguing Plaintiff knew the basis for her breach of the duty of good faith and fair dealing claim prior to the amendment of pleadings deadline, the newly pleaded allegations are immaterial to her proposed claim, and amendment is futile. See [#76]. Plaintiff has since replied, see [#77], and thus the Motion to Amend is ripe for recommendation. I consider the Parties' arguments below.


         As courts in this District have repeatedly observed, a “Scheduling Order is not a frivolous piece of paper, idly entered, which can be cavalierly disregarded by counsel without peril.” E.g., Lehman Bros. Holdings Inc. v. Universal Am. Mortg. Co., LLC, 300 F.R.D. 678, 681 (D. Colo. 2014). Indeed, a Scheduling Order is an important tool used for the orderly preparation of a case for trial and to avoid surprise to the parties and to the court. Id. Accordingly, Rule 16(b)(4) of the Federal Rules of Civil Procedure expressly provides that “[a] schedule may be modified only for good cause and with the judge's consent.” Fed.R.Civ.P. 16(b)(4). The Scheduling Order expressly reflects this principle. [#21 at 8].

         The purpose of the deadline to amend pleadings and join parties, as set out in a Scheduling Order, is to force the parties to prioritize their discovery to obtain the information necessary to know if amendment is required sooner rather than later. This also ensures that discovery proceeds in an orderly fashion. See Valles v. Gen-X Echo B, Inc., Civil Action No. 13-cv-00201-RM-KLM, 2013 WL 5832782, *3 (D. Colo. Sept. 27, 2013). Accordingly, when a party seeks to amend pleadings after the deadline set in the Scheduling Order, the court's consideration is subject to a two-prong analysis. First, the party must establish good cause under Rule 16(b)(4) of the Federal Rules of Civil Procedure. See Gorsuch, Ltd., B.D. v. Wells Fargo Nat'l Bank Ass'n, 771 F.3d 1230, 1240 (10th Cir. 2014). Only if the party ...

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