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Johnson v. Washington Mutual

May 4, 2010

GWENDOLYN J. JOHNSON, PLAINTIFF,
v.
WASHINGTON MUTUAL, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Anthony W. Ishii Chief United States District Judge

ORDER ON PLAINTIFF'S MOTION TO AMEND AND DEFENDANTS' MOTION TO DISMISS (Doc. Nos. 54, 55, 59)

Currently pending before this Court is a Rule 41(b) motion to dismiss by Defendants California Reconveyance Company, Mortgage Electronic Registration Systems, Inc., and J.P. Morgan Chase, an acquirer of certain assets and liabilities of Washington Mutual (collectively "Defendants").*fn1 Also Pending is Plaintiff's motion to amend the complaint. For the reasons that follow, Defendants' motion will be granted and Plaintiff's motion will be denied.

BACKGROUND

On February 24, 2010, the Court granted Defendants' motion to dismiss and dismissed all claims alleged against them in the Second Amended Complaint ("SAC").*fn2 See Court's Docket Doc. No. 53. Specifically, the Court dismissed the second, third, fourth, sixth, seventh, and tenth causes of action. See id. The dismissal order gave Plaintiff twenty days in which to file an amended complaint that was consistent with the dismissal order. See id. Plaintiff failed to do so.

On March 17, 2010, Defendants filed a Rule 41(b) motion to dismiss. The basis for the motion was Plaintiff's failure to amend her complaint in the time provided by the dismissal order.

On April 21, 2010, Plaintiff filed several documents. Plaintiff filed a non-opposition to the dismissal of the first and fourth causes of action against the Defendants.*fn3 See id. at Doc. No. 58. Similarly, Plaintiff also filed a notice of dismissal that purports to dismiss only the first and fourth claims against the Defendants. See id. at Doc. Nos. 57, 60, 61.*fn4 Finally, Plaintiff filed a motion to amend. See id. at Doc. No. 59. Plaintiff has attached a copy of the proposed third amended complaint ("TAC").

On April 26, 2010, Defendants responded to Plaintiff's motion to amend.

PLAINTIFF'S MOTION TO AMEND

Plaintiff's Argument Under Rule 15, amendments are to be allowed liberally. The proposed TAC would not prejudice Defendants because the TAC removes causes of action, reduces issues, clarifies parties, and corrects typographical errors. The TAC also removes all federal causes of action and only state law claims would remain. Plaintiff states that she would have no objection to the Court declining to exercise supplemental jurisdiction and dismissing the case without prejudice.

Defendants' Response

Defendants argue that Plaintiff is playing procedural games. Plaintiff's motion should be disregarded as it was untimely filed. Plaintiff did not file her amended complaint within twenty days of the dismissal order. The parties have engaged in extensive and expensive motions practice for nearly a year and have not conducted substantive discovery or settlement negotiations. The request to dismiss is nonsensical since the Court already dismissed the entire complaint. Further, the proposed TAC is flawed. Plaintiff's motion should be denied.

Legal Standard

When a party may no longer amend a pleading as a matter of right under Rule of Civil Procedure 15(a)(1), the party must either petition the court for leave to amend or obtain consent from the adverse parties. Fed. R. Civ. Pro. 15(a)(2); Keniston v. Roberts, 717 F.2d 1295, 1300 (9th Cir. 1983). Rule 15(a)(2) instructs courts to "freely give leave [to amend] when justice so requires." Fed. R. Civ. Pro. 15(a)(2); Zucco Partners, LLC v. Digimarc Corp., 552 F.3d 981, 1007 (9th Cir. 2009). "This policy is to be applied with extreme liberality." Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1051 (9th Cir. 2003); Owens v. Kaiser Found. Health Plan, Inc., 244 F.3d 708, 712 (9th Cir. 2001). "This liberality in granting leave to amend is not dependent on whether the amendment will add causes of action or parties." DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 186 (9th Cir. 1987). However, a court may deny leave to amend "due to undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party . . ., and futility of amendment." Zucco, 552 F.3d at 1007; Leadsinger, Inc. v. BMG Music Publ'g, 512 F.3d 522, 532 (9th Cir. 2008). Prejudice to the defendant is the most important factor, but amendment may be denied upon a sufficiently strong showing of other factors. See Eminence Capital, 316 F.3d at 1052; Keniston, 717 F.2d at 1300. Where a plaintiff has ...


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