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Sloan v. General Motors LLC

United States District Court, N.D. California

July 2, 2019

MONTEVILLE SLOAN, et al., Plaintiffs,
v.
GENERAL MOTORS LLC, Defendant.

          ORDER GRANTING PLAINTIFFS' MOTION FOR LEAVE TO FILE FIFTH AMENDED COMPLAINT DOCKET NO. 141

          EDWARD M. CHEN UNITED STATES DISTRICT JUDGE

         Plaintiffs allege that Defendant General Motors (“GM”) knowingly manufactured and sold a car engine with inherent defects that caused excessive oil consumption and engine damage. The defects affect 2010 to 2014 model year GM vehicles. Based on those allegations, Plaintiffs assert claims under various state consumer protection and fraud statutes on behalf of a nationwide class as well as 29 statewide classes. Plaintiffs' original class action complaint was filed in December 19, 2016. Docket No. 2. They have since amended their pleadings several times, and the operative complaint is the Fourth Amended Complaint. Docket No. 123.

         Plaintiffs now seek leave from the Court to file a Fifth Amended Complaint. Docket No. 141 (“Mot.”). The purpose of the amendment is to substitute Thomas Szep, a member of the putative Ohio class, in place of the current Ohio class representatives, Thomas Gulling and Ronald Jones, who are no longer able to participate in this litigation due to “personal reasons.” Id. at 1. GM opposes Plaintiffs' motion. Docket No. 153 (“Opp.”). For the reasons discussed below, the Court GRANTS Plaintiffs' motion for leave to file a Fifth Amended Complaint.

         I. BACKGROUND

         To address manageability concerns raised by the Court, the parties agreed that Plaintiffs' initial motion for class certification would be limited to five bellwether states: California, New Jersey, Ohio, North Carolina, and Texas. Docket No. 113. In January 2019, the Court issued a scheduling order for the class certification proceedings. Docket No. 128. The deadline for completion of fact discovery and for the filing of motions to amend the pleadings was set for May 30, 2019. Id. The deadline for Plaintiffs to file their class certification motion was set for June 30, 2019, but has been extended to July 30, 2019 to allow resolution of the instant motion. Docket No. 151.

         On April 23, 2019, Plaintiffs informed GM that the representatives of the putative Ohio class, Gulling and Jones, no longer wished to continue as plaintiffs and would be dismissing their claims. Docket No. 154 (“Ross Decl.”), Exh. A at 2. Plaintiffs' counsel indicated that Szep, a putative Ohio class member, was willing to be substituted in as the Ohio class representative. Id. GM declined Plaintiffs' invitation to stipulate to the substitution on the grounds that there were “only weeks remaining in the discovery period” and the “last minute switch-up is prejudicial to GM and would disrupt the schedule crafted by the Court and the parties.” Id. at 1. GM's counsel suggested that Plaintiffs should either move the Court for permission to amend their complaint or drop Ohio as a bellwether state. Id.

         On May 30, 2019-the deadline for fact discovery and amendment of pleadings- Plaintiffs' counsel initially informed GM that they would not be substituting an Ohio class representative for Gulling and Jones or pursuing class certification of the Ohio claims. Id. Two hours later, however, Plaintiffs' counsel notified GM that there “ha[d] been a miscommunication about whether [Plaintiffs] would be seeking to substitute a new plaintiff, ” and that they “w[ould], in fact, be seeking such a substitution.” Docket No. 155-1 (“Tangren Decl.”), Exh. B. Plaintiffs filed this motion the same day.

         II. DISCUSSION

         A. Legal Standard

         Federal Rule of Civil Procedure 15(a)(2) provides that leave to amend a complaint should be “freely given when justice so requires.” Generally, leave to amend is to be granted with “extreme liberality.” Morongo Band of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990). But here, GM argues, relying on Coleman v. Quaker Oats Co., 232 F.3d 1271 (9th Cir. 2000), that the stricter standard of Rule 16(b) applies because the Court has already entered a pretrial scheduling order. Opp. at 4. GM misreads Coleman. Rule 16(b) provides that a scheduling order “may be modified only for good cause and with the judge's consent.” Fed.R.Civ.P. 16(b)(4). In Coleman, the Ninth Circuit held that the Rule 16(b) “good cause” standard applied not merely because a scheduling order had been entered, but because the plaintiffs were seeking to amend their complaints after “the time specified in the scheduling order expired.” Id. at 1294. Accordingly, allowing the amendment would have required modifying the scheduling order. See Eurosesmillas, S.A. v. PLC Diagnostics, Inc., No. 17-CV-03159-TSH, 2019 WL 1960342, at *3 (N.D. Cal. May 2, 2019) (“Once the court issues a pretrial scheduling order that establishes a deadline for the amendment of pleadings, a motion to amend filed after the deadline for amendment is governed by Rule 16 of the Federal Rules of Civil Procedure rather than Rule 15.” (emphasis added) (citing Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 607-08 (9th Cir. 1992))).

         Unlike in Coleman, Plaintiffs in this case moved to amend within the deadline set by the Court. The regular Rule 15(a)(2) standard therefore applies. Under that standard, the Court considers five factors in ruling on 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 his complaint. In re W. States Wholesale Natural Gas Antitrust Litig., 715 F.3d 716, 738 (9th Cir. 2013). Of these factors, “it is the consideration of prejudice to the opposing party that carries the greatest weight.” Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003) (citations omitted). “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.” Id. (emphasis in original).

         B. Analysis

         GM does not argue that Plaintiffs are seeking to amend in bad faith or that their proposed amendment would be futile. Rather, GM asserts that Plaintiffs unduly delayed in filing their motion and the delay is prejudicial to GM. See Opp. at 5-7. The Court disagrees.

         Plaintiffs did not unduly delay in moving for leave to amend. Upon learning that Jones and Gulling would be dropping out of the litigation, Plaintiffs promptly asked GM on April 23, 2019 whether it would be willing to stipulate to allow Szep to step in as the Ohio class representative. Ross Decl., Exh. A at 2. GM wrote back with its refusal a week later. Id. at 1. It took Plaintiffs another month after that to file its motion, but they represent that “[d]ue to [Szep's] work schedule in May 2019, which included twelve-hour night shifts, he was unable to confirm that he would be available to complete discovery until May 30, 2019.” Docket No. 155 at 3. The day after moving to amend, Szep responded in full to the requests for production and interrogatories that GM had served on the other class ...


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