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Clear-View Technologies, Inc. v. Rasnick

United States District Court, N.D. California, San Jose Division

March 23, 2015

CLEAR-VIEW TECHNOLOGIES, INC., Plaintiff,
v.
JOHN H. RASNICK, et al., Defendants.

ORDER DENYING DEFENDANTS' MOTION FOR LEAVE TO FILE IMPLEADER, OR, IN THE ALTERNATIVE, TO JOIN PARTIES [Re: ECF 123]

BETH LABSON FREEMAN, District Judge.

This suit concerns a dispute over an agreement to develop and sell a product called "The BarMaster, " a beverage inventory control system. Plaintiff CVT contends that Defendants conspired with a group of rogue CVT employees to wrest control from then-existing management, and allege claims for tortious interference with contract, unfair competition, civil conspiracy, and breach of contract.

Defendants now move for leave to file a third party complaint for indemnification against three proposed Third Party Defendants under Federal Rule of Civil Procedure 14(a), or, in the alternative, to join those parties as defendants under Federal Rules of Civil Procedure 19 and 21.[1] Plaintiff opposes on all grounds. The Court finds this motion appropriate for resolution without oral argument, see Civil L.R. 7-1(b), and for the reasons provided below DENIES Defendants' motion.

I. PROCEDURAL BACKGROUND

Plaintiff filed its original complaint on June 14, 2013, and Defendants answered on September 20, 2013. Thereafter, on January 8, 2014, Judge Edward Davila, to whom this case was previously assigned, entered a case management order setting March 10, 2014 as the deadline for joinder of additional parties. See ECF 26.

Plaintiff filed its FAC on March 10, 2014. Defendants answered the FAC on April 7, 2014. After this case was reassigned to the undersigned, Defendants sought leave of Court to amend their answer to assert counterclaims, though they did not at this time attempt to assert claims against any third party defendant. The Court granted Defendants' motion for leave, and Defendants filed their amended answer on September 15, 2014. Plaintiff answered Defendants' counterclaims on September 29, 2014.

On October 24, 2014, the Court modified the case schedule at Plaintiff's request, extending fact discovery and other deadlines. At the hearing on Plaintiff's request to modify the schedule and stay discovery, the Court made clear that it would make no further modifications to the discovery or trial schedule. See Tilley Decl. Exh. B. at 16 (a copy of the hearing transcript) (in which the Court notes that Defendants, who were planning to obtain new counsel, "need[ed] to understand that it's a firm trial date with a firm discovery schedule in place").

This motion followed on December 28, 2014. After briefing, the motion was set for oral argument on March 26, 2015, which the Court vacated upon its determination that this motion was suitable for disposition without oral argument.

II. LEGAL STANDARDS

A. Rule 14

Federal Rule of Civil Procedure 14 permits a party to bring a third party complaint against any "nonparty who is or may be liable to it for all or part of the claim against it." Fed.R.Civ.P. 14(a)(1). If more than fourteen days have passed since the service of the defendant's (and would-be third party plaintiff's) original answer, however, the party "must, by motion, obtain the court's leave" to file such a third party complaint. Id. Whether to grant leave in such a circumstance is "within the sound discretion of the trial court." Helferich Patent Licensing, LLC v. Legacy Partners, LLC, 917 F.Supp.2d 985, 988 (D. Ariz. 2013) (citing United States v. One 1977 Mercedes Benz, 708 F.2d 444, 452 (9th Cir. 1983)). The purpose of Rule 14 is to promote judicial efficiency. See, e.g., Sw. Adm'rs, Inc. v. Rozay's Transfer, 791 F.2d 769, 777 (9th Cir. 1986).

In determining whether to grant leave, the Court must consider several factors: the timeliness of the motion, whether impleader is likely to delay trial, and whether impleader would prejudice the original Plaintiff. See, e.g., Irwin v. Mascott, 94 F.Supp.2d 1052, 1056 (N.D. Cal. 2000). It must also consider whether impleader would disadvantage the existing action by "complicating and lengthening the trial, or introducing extraneous questions." Sw. Adm'rs at 777.

B. Rule 19

Rule 19 governs compulsory joinder of parties, demanding that the Court order parties joined when, "in that person's absence, the court cannot accord complete relief among existing parties, " Fed.R.Civ.P. 19(a), or when a party "claims an interest in the subject of the action, and the disposition of the action may as a practical matter impair or impede his ability to protect that interest.'" Eldridge v. Carpenters 46 N. Calif. Cnties. Joint Apprenticeship & Training Cmte., 662 F.2d 534, 536 (9th Cir. 1982). Courts ...


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