United States District Court, C.D. California
ALBERT KIRAKOSIAN ET AL.
J AND L.D. SUNSET WHOLESALE AND TOBACCO, ETC. ET AL.
Present: The Honorable CHRISTINA A. SNYDER
CIVIL MINUTES - GENERAL
(IN CHAMBERS) - PLAINTIFF'S MOTION FOR LEAVE TO AMEND
COMPLAINT (Filed March 15, 2017, Dkt. 86)
Court finds this matter appropriate for decision without oral
argument. Fed.R.Civ.P. 78; L.R. 7-15. Accordingly, the
hearing date of April 17, 2017, is hereby vacated and the
matter is taken under submission.
INTRODUCTION AND BACKGROUND
August 15, 2016, plaintiffs filed suit against defendants
J&L D Sunset Wholesale & Tobacco, J&L D Sunset
Wholesale & Tobacco dba 7SG Stars Glass, Wholesale
Palace, Inc., Jack Haroun, Glenoaks House of Smokes, Glendale
House of Smokes, Hookah King (“Hookah King”),
Levon Vardanyan, Planet Tobacco, Hayk's Smoke Shop, The
Heavy Hitter Group, Inc., U.S. Batta (“US
Batta”), Vatche Kiwanian (“Kiwanian”), U.S.
Global Imports (“US Global”), Southbay Wholesale
(“Southbay”), Mission Wine & Spirits, Zahrah
Tobacco LLC dba Zahrah Hookah, and Does 1 Through 100,
inclusive. Dkt. 1. (“Complaint”). The Complaint
alleges patent infringement and violations of the Lanham Act.
Id. The following parties have appeared by way of
filing an answer to the Complaint: The Heavy Hitter Group,
Inc., U.S. Batta, Kiwanian, U.S. Global, Hookah King, and
March 15, 2017, plaintiffs filed a motion seeking leave to
amend the Complaint. Dkt. 86. (“Mot.”). The
Motion seeks to dismiss three defendants, U.S. Global, Hookah
King, and Southbay (collectively, the “Dismissed
Parties”), without prejudice. Id. Two
defendants, U.S. Batta and Kiwanian, filed an opposition to
the motion on March 27, 2017, dkt. 90
(“Opp'n.”), and on April 3, 2017, plaintiffs
filed a reply, dkt. 91.
carefully considered the parties' arguments, the Court
finds and concludes as follows.
Civ. P. 15 provides that after a responsive pleading has been
filed, “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).
leave to amend is required, the decision whether to grant
leave to amend “is entrusted to the sound discretion of
the trial court.” Jordan v. County of Los
Angeles, 669 F.2d 1311, 1324 (9th Cir. 1982),
vacated on other grounds, 459 U.S. 810 (1982).
“Five factors are taken into account to assess the
propriety of a motion for leave to amend: bad faith, undue
delay, prejudice to the opposing party, futility of
amendment, and whether the plaintiff has previously amended
the complaint.” Johnson v. Buckley, 356 F.3d
1067, 1077 (9th Cir. 2004) (citing Nunes v.
Ashcroft, 348 F.3d 815, 818 (9th Cir. 2003)).
“Some courts have stressed prejudice to the opposing
party as the key factor.” Texaco v. Ponsoldt,
939 F.2d 794, 798 (9th Cir. 1991). “Absent prejudice,
or a strong showing of any of the remaining . . . factors,
there exists a presumption under Rule 15(a) in favor of
granting leave to amend.” Eminence Capital, LLC v.
Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003)
(emphasis omitted); see Griggs v. Pace Am. Group,
Inc., 170 F.3d 877, 880 (9th Cir. 1999) (stating that
when a court conducts a Rule 15(a) analysis, generally all
inferences should be drawn in favor of granting the motion).
March 13, 2017, ONE LLP substituted in and replaced CNT Law
Group PC as counsel of record for plaintiffs. Plaintiffs'
new counsel previously represented U.S. Global and Hookah
King in a separate action. Mot. at 2. Plaintiffs aver that
they would like to dismiss U.S. Global, Hookah Kings, and
Southbay Wholesale from this action “to avoid any
potential for discomfort between their counsel and
counsel's former clients.” Id. at 3.
Defendants argue that leave to amend should be denied because
such amendment would prejudice defendants, is futile, and is
filed in bad faith.
argue that allowing plaintiffs' amendment would prejudice
defendants because they would “be forced to bring [the
Dismissed Parties] back into the action” by way of
third-party complaint for indemnity or contribution.
Opp'n at 4. Defendants aver that the amendment would
therefore delay the trial, increase discovery burdens, and
increase costs. Opp'n. at 4. The Court finds this
argument unpersuasive because allowing plaintiffs to dismiss
parties from the complaint would not cause delay or prejudice
the defendants. In the context of patent and trademark
infringement suits, “plaintiffs may choose whom to sue
and [are] not required to join all infringers in a single
action.” Wright & Miller, 7 Fed. Prac. & Proc.
Civ. § 1614 (3d ed. 2010). Granting plaintiffs'
motion does not prevent defendants from seeking leave to file
a third-party complaint. See Fed.R.Civ.P. 14(a).
Whether defendants seek indemnity or contribution from the
Dismissed Parties is within their control. Accordingly, the
Court finds that defendants have failed to establish that
plaintiffs' amendment would result in prejudice.
also argue that the amendment is futile because the proposed
amendment will not remove the Dismissed Parties from this
case. Opp'n. at 5-6. However, whether defendants choose
to file third-party complaints against the Dismissed Parties,
that decision (which rests with defendants) does not render
plaintiff's dismissal of claims “futile.” As
noted above, plaintiffs may choose whom to sue and are not
required to sue everyone who may ultimately pay. An amendment
is futile when “no set of facts can be proved under the
amendment to the pleadings that would constitute a valid and
sufficient claim or defense.” Missouri ex rel.
Koster v. Harris, 847 F.3d 646, 656 (9th Cir. 2017)
(quoting Miller v. Rykoff-Sexton, Inc., 845 F.2d