SAUNDRA BROWN ARMSTRONG, District Judge.
On June 25, 2010, Ritz Camera & Image, LLC ("Ritz") commenced the instant antitrust class action on behalf of itself and a putative class against Defendants SanDisk Corporation ("SanDisk") and Eliyahou Harari ("Harari") alleging claims under § 2 of the Sherman Antitrust Act ("Sherman Act"), 15 U.S.C. § 2.
On June 25, 2010, Ritz filed a class action complaint against SanDisk and Harari on behalf of itself and a putative class of direct purchasers of NAND flash memory products,
The FAC alleges claims under the Sherman Act for conspiracy to monopolize and monopolization of the market for NAND flash memory products through the assertion of fraudulent patents.
On October 1, 2010, SanDisk moved to dismiss the FAC. Dkt. 39. On February 24, 2011, Judge Fogel issued an order granting in part and denying in part SanDisk's motion. Dkt. 60. Judge Fogel granted the motion as to the conspiracy to monopolize claim without leave to amend, and denied the motion as to the monopolization claim.
On January 13, 2012, the Federal Circuit granted SanDisk's petition for permission to appeal the issue of whether direct purchasers of patented products may bring a
On July 5, 2013, the Court granted Ritz's motion to transfer its interest under Rule 25(c) of the Federal Rules of Civil Procedure, substituting Alfred T. Giuliano, Chapter 7 Trustee of the Ritz bankruptcy estate, as the named Plaintiff in this action. Dkt. 138. The parties are presently before the Court on Plaintiff's motion for leave to file a SAC. Dkt. 132. SanDisk opposes the motion. Dkt. 134.
A party may amend its pleading once as a matter of course within 21 days after serving it, or if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or (f), whichever is earlier. Fed.R.Civ.P. 15(a)(1). "In all other cases, a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires." Fed.R.Civ.P. 15(a)(2).
The United States Supreme Court has identified the following factors a district court should consider in deciding whether to grant leave to amend: (1) undue delay, (2) bad faith or dilatory motive on the part of the movant; (3) repeated failure to cure deficiencies by amendments previously allowed; (4) undue prejudice to the opposing party by virtue of allowance of the amendment; and (5) futility of amendment.
Not all of the factors merit equal weight; it is the consideration of prejudice to the opposing party that carries the greatest weight.
The party opposing the amendment carries the burden of showing why leave to amend should not be granted.
In the instant motion, Plaintiff requests leave to amend the FAC in several respects. Specifically, Plaintiff seeks to file a SAC that refines the definition of the relevant antitrust market, specifies that members of the proposed class must reside in the United States, eliminates Harari as a Defendant, clarifies the nature and source of Plaintiff's antitrust standing, and corrects minor errors. Pl.'s Mtn. at 2. SanDisk opposes the motion primarily on the ground that the proposed SAC realleges a claim for conspiracy to monopolize under the Sherman Act. Def.'s Opp. at 1, 3-5. SanDisk contends that leave to amend should be denied because this claim was dismissed with prejudice by Judge Fogel.
The Ninth Circuit has recently held that for claims dismissed with prejudice, a plaintiff is not required to reallege such claims in a subsequent amended complaint to preserve them for appeal.
The Ninth Circuit further explained that a rule requiring plaintiffs to reallege claims dismissed with prejudice in a subsequent amended complaint is unfair to plaintiffs because it creates a "Hobson's choice[,] . . . a patently coercive predicament between amending the complaint—thereby forgoing the chance to appeal the dismissal of some claims—and appealing the dismissal of the claims in the original complaint—thereby forgoing the chance to add or replead claims that the plaintiff would otherwise be allowed to add."
While it is not improper under
To the extent SanDisk argues that Plaintiff's motion should be denied on the ground that it "raises questions as to whether [Plaintiff's] proposed amendment is offered in good faith," the Court rejects this argument. Contrary to SanDisk's contention, Plaintiff's motion is not "littered with a disproportionate number of misstatements and omissions" suggesting bad faith. In this regard, SanDisk argues that the proposed amendments "go well beyond [the] mere addition of facts and clarifications of `existing allegations'" as Plaintiff claims. However, the only specific amendments to which SanDisk objects concern the definition of the relevant antitrust market. Without elaboration or citation to portions of the proposed SAC, SanDisk asserts that Plaintiff seeks to change the definition of the relevant antitrust market from worldwide to the United States. A review of the proposed SAC does not support SanDisk's position. The proposed SAC alleges that "[t]he `relevant geographic market' for the purchase of NAND flash memory is "worldwide, because raw and finished NAND flash memory can be manufactured and distributed on a global scale. The `relevant market' refers to the worldwide market for raw and finished NAND flash memory that legally could be imported and sold into the United States without infringing any U.S. patents and without facing a risk of an ITC proceeding." Proposed SAC ¶ 27, Dkt. 132-1.
Further, a review of the instant motion does not support SanDisk's contention that Plaintiff is attempting to "circumvent" Judge Fogel's Order dismissing Plaintiff's conspiracy claim with prejudice. Plaintiff acknowledges that Judge Fogel granted SanDisk's motion to dismiss the FAC in part, i.e., dismissed his conspiracy claim. Moreover, as noted above, Plaintiff requests leave to reallege his conspiracy claim for the purpose of preserving his options on appeal, not to "circumvent" Judge Fogel's Order by attempting to "revive" this claim.
Finally, the Court rejects SanDisk's contention that Plaintiff's motion should be denied because the monopolization claim expressly relies on the facts alleged in support of the dismissed conspiracy claim. SanDisk has failed to show that granting leave to amend would be futile. SanDisk has not shown that Plaintiff's monopolization claim fails as a matter of law in the absence of the conspiracy claim allegations. Nor has SanDisk shown that it is appropriate to strike "the other allegations [throughout] the proposed SAC relating to the[] previously dismissed conspiracy claim" under Rule 12(f) of the Federal Rules of Civil Procedure. SanDisk has not cited any authority or provided persuasive legal analysis demonstrating that these allegations are "redundant, immaterial, impertinent, or scandalous matter" within the meaning of Rule 12(f).
In sum, Plaintiff's motion for leave to file a SAC is GRANTED IN PART AND DENIED IN PART. Plaintiff's motion is denied to the extent Plaintiff requests leave to reallege his conspiracy to monopolize claim. Plaintiff's motion is granted in all other respects. SanDisk has not demonstrated that leave to amend should be denied with respect to the proposed amendments to the FAC. The arguments presented by SanDisk are insufficient to overcome Rule 15(a)'s liberal policy in favor of permitting amendment.
This matter was scheduled for a telephonic case management conference ("CMC") to take place on July 18, 2013. The parties' Sixth Revised Joint Case Management Statement, Dkt. 139, filed in anticipation of the CMC raises a number of disputed issues, which are discussed below.
The parties agree that Plaintiff's motion for class certification should be filed by no later than January 9, 2014. In relation to said motion, Plaintiff indicates that he intends to file "motions for leave to amend relating to issues of the identity of the class representative(s) and class definition" by November 25, 2013. Dkt. 139 at 3. SanDisk counters that the deadline to amend lapsed on June 7, 2013, and that Plaintiff has not shown good cause under Federal Rule of Civil Procedure 16(b)(4) to alter that deadline.
As an initial matter, the Court has not yet entered a pretrial scheduling order establishing a specific deadline for amending the pleadings. But even if it had, Plaintiff would not be barred from seeking leave to amend.
The parties have proposed a briefing schedule on Plaintiff's motion for class certification which is acceptable to the Court. Dkt. 139 at 4. Accordingly, the briefing schedule shall be as follows:
The parties should be aware that under this Court's Standing Orders, all motions, except motions for summary judgment, are limited to fifteen pages for the moving and opposition briefs and ten pages for the reply. Pursuant to Civil Local Rule 7-1(b), the Court may adjudicate the motion without a hearing. The parties are advised to check the Court's website to determine whether an appearance on the motion is necessary.
Under Federal Rule of Civil Procedure 30, each party is limited to ten depositions, absent a court order permitting additional depositions. Each deposition is limited to one day for a maximum of seven hours. Fed.R.Civ.P. 30(d)(1).
Plaintiff seeks leave for 125 hours of fact depositions per side, for a total of 31 depositions. However, the Court finds that Plaintiff's request is premature. The parties' initial disclosures collectively identify fifteen unique witnesses, all of whom presumably could be deposed under the presumptive limits imposed by Rule 30. While discovery possibly could result in the identification of additional witnesses, the number of such witnesses, if any, remains unclear at this juncture. Accordingly, Plaintiff's request for additional depositions beyond the limits imposed by Rule 30 is denied without prejudice.
The parties have proposed a fact discovery cut-off date of June 16, 2014, an expert disclosure/report deadline of July 15, 2014 and a rebuttal expert deadline of August 14, 2014. The Court typically does not stagger fact discovery and expert disclosure report deadlines in that manner. Thus, the Court sets July 14, 2014 as the deadline for fact discovery and expert reports. Rebuttal expert reports are due by August 14, 2014. Expert discovery shall be completed by August 30, 2014.
The Court will discuss the trial schedule and set all other pretrial dates at the case management conference currently scheduled for October 7, 2013 at 3:00 p.m. Dkt. 140.
For the reasons stated above, IT IS HEREBY ORDERED THAT:
1. Plaintiff's motion for leave to file a SAC is GRANTED IN PART AND DENIED IN PART. Plaintiff shall file a SAC in accordance with this Order within seven (7) days from the date the Order is filed.
2. This Order terminates Docket 132.
IT IS SO ORDERED.