The opinion of the court was delivered by: MARILYN PATEL, Chief Judge, District
MEMORANDUM & ORDER
Re: Defendant's Motions to Strike and for Judgment
on the Pleadings; Plaintiff's Motion for Leave to Amend
Plaintiff Laura Serpa originally brought this action against defendants
SBC Telecommunications and SBC Services ("defendants") in state court
seeking damages resulting from the distribution of retirement benefits
under defendants' retirement program, the SBC Enhanced Pension and
Retirement Program ("Pension Plan"). SBC Services is Serpa's former
employer; SBC Telecommunications is a plan sponsor, administrator, and
named fiduciary. In her state court complaint, Serpa alleged state law
claims of negligence, promissory estoppel, fraud, and unfair business
practices under California Business and Professions Code section 17200.
Defendants removed the action to federal court on the ground that Serpa's
state claims were completely preempted by the Employment Retirement
Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. Now before this
court are defendants' motion for judgment on the pleadings, plaintiff's
motion for leave to amend those pleadings, and defendants' motion to
strike the amended complaint for failure to secure the court's leave.
After having considered the parties' arguments and submissions, and for
the reasons set forth below, the court rules as follows. BACKGROUND*fn1
In 2000, defendants offered select employees an early retirement
option. To help these employees understand their choices under the early
retirement plan, defendants offered benefits counseling. Serpa spoke with
Pension Plan administrators about her retirement policy, and the plan
administrators offered her an enhanced retirement package in the amount
of $374,000. Serpa accepted this early retirement option and resigned her
position at SBC.
Following her retirement, however, defendants remitted only $265,000 of
the $374,000 retirement package discussed. Serpa demanded a calculated
summary pension statement from defendants, and she was told that $87,000
of her retirement benefit payout had been placed into a separate account
as a set-aside for her ex-husband, Thomas Serpa, pursuant to a
court-issued Qualified Domestic Relations Order ("QDRO"). Although the
set-aside had been calculated ten months before she elected to retire,
the deduction of that amount from the retirement payout was never
discussed with Serpa.*fn2 Serpa alleges that the defendants misled her
regarding the amount of early retirement benefits she would receive
because they neglected to tell her that her ex-husband would receive a
portion of her Pension Plan benefits. Serpa claims that, because
defendants set aside the required amount prior to her retirement, they
should have informed her about the reduction in her benefits. Had
defendants done so, she claims, she would not have taken the early
Serpa filed a complaint in state court in August 2001, alleging
negligence, promissory estoppel, fraud, and unfair business practices.
For these alleged wrongs, Serpa seeks the full amount of promised
benefits, lost salary and benefits, damages for mental and emotional
distress, and punitive damages. Serpa amended her original state court
complaint in August 2002, but she later abandoned it to pursue her claims
through the Pension Plan's ERISA-mandated claims procedure. After
completing the claims procedure without a satisfactory result, Serpa
filed a second complaint in state court on August 12, 2003. Defendants
removed the action to federal court in September 2003, answering the complaint and asserting that all of Serpa's claims
were governed by ERISA.*fn3 Subsequent mediation and attempts to
convince Serpa that her state claims were preempted under ERISA all
failed, and defendants filed the instant motion for judgment on the
Serpa subsequently attempted to amend her complaint by filing a new
pleading that added two claims under ERISA (namely, breach of fiduciary
duty and promissory estoppel). Because she failed either to obtain a
stipulation from defendants or leave of the court to amend the complaint,
defendants moved to strike Serpa's amended complaint under Rule 15(a).
Serpa then filed a motion asking the court for leave to amend the
complaint. See Fed.R.Civ.P. 15(a).
I. Judgment on the Pleadings
A motion for judgment on the pleadings is proper "when the moving party
clearly establishes on the face of the pleadings that no material issue
of fact remains to be resolved and that it is entitled to judgment as a
matter of law." Fed.R.Civ.P. 12(c); Hal Roach Studios. Inc. v. Richard
Feiner & Co., 896 F.2d 1542, 1550 (9th Cir. 1990). In reviewing a motion
under Rule 12(c), the court must assume that the facts alleged by the
nonmoving party are true and must construe all inferences drawn from
those facts in favor of the nonmoving party. General Conference Corp. of
Seventh-Day Adventists v. Seventh-Day Adventist Congregational Church,
887 F.2d 228, 230 (9th Cir. 1989), cert. denied, 493 U.S. 1079 (1990).
The court need not assume the truth of legal conclusions in the complaint
merely because they take the form of factual allegations. Western Mining
Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981), cert. denied,
454 U.S. 1031 (1981).
II. Motion for Leave to Amend
A party is entitled to amend its pleadings once as a matter of course
before a responsive pleading is served. See Fed.R.Civ.P. 15(a). After a
response has been filed, a party may amend its pleadings "only by leave
of court or by written consent of the adverse party." Id. Federal Rule of
Civil Procedure 15(a) provides for the amendment of pleadings by leave of
court and notes that such leave "shall be freely given when justice so requires." Fed.R.Civ.P. 15(a).
This rule is applied with "extreme liberality," Eminence Capital. LLC v.
Aspeon, Inc., 316 F.3d 1048, 1051 (9th Cir. 2003). However, the grant or
denial of a motion to amend is committed to the discretion of the
district court, and the court may decline to grant leave where there is
"any apparent or declared reason" for doing so. Foman v. Davis,
371 U.S. 178, 182 (1962); see also Lockman Found. v. Evangelical Alliance
Mission, 930 F.2d 764, 772 (9th Cir. 1991). The Ninth Circuit has
interpreted Foman as identifying "four factors relevant to whether a
motion for leave to amend pleadings should be denied: undue delay, bad
faith or dilatory motive, futility of amendment, and prejudice to the
opposing party." United States v. Webb, 655 F.2d 977, 980 (9th Cir.
1981). The enumerated factors are not of equal weight. Id. (citing Howey
v. United States, 481 F.2d 1187 (9th Cir. 1973)). "Prejudice is the
touchstone of the inquiry under rule 15(a)." Eminence Capital, 316 F.3d
at 1052. Absent prejudice, there is a presumption under Rule 15(a) in
favor of granting leave to amend. Id. The party opposing leave to amend
bears the burden of showing prejudice, DCD Programs. Ltd. v. Leighton,
833 F.2d 183, 187 (9th Cir. 1987).
I. Defendant's Motion for Judgment on ...