United States District Court, N.D. Iowa, Western Division
THE JOHN ERNST LUCKEN REVOCABLE TRUST, and JOHN LUCKEN and MARY LUCKEN, Trustees, Plaintiffs,
HERITAGE BANKSHARES GROUP, INC., et al., Defendants.
Williams, Chief United States Magistrate Judge
matter is before the Court pursuant to plaintiffs' motion
for reconsideration of the order denying plaintiffs'
first motion to amend the complaint and plaintiffs'
second motion to amend the complaint. (Doc. 33). Plaintiffs
request leave of court to amend their complaint based on new
information not known to plaintiffs prior to receiving
defendants' responses to plaintiffs' first request
for production of documents. (Doc. 33 at 5-8). Defendants do
not resist this motion. (Doc. 41). For the reasons that
follow, the Court grants plaintiffs' motion.
filed the present suit on January 14, 2016, stemming from an
agreement regarding the financing of Dirks Motor Co., of
which defendants were creditors, alleging: 1) fraud through
affirmative representations and omissions of material fact;
2) violation of 12 U.S.C. § 1972 for a prohibited
“Tying Arrangement”; 3) liability of senior
executive officers within defendants' bank due to
sanctioning the fraudulent conduct of the bank's agents;
4) breach of the duty of disclosure; 5) unjust enrichment;
and 6) contract rescission. (Doc. 1).
April 27, 2016, Scheduling Order and Discovery Plan set the
deadline to amend pleadings as August 12, 2016. (Doc. 14). On
November 21, 2106, plaintiffs filled their first motion to
amend their complaint. (Doc. 24). On January 6, 2017, the
motion to amend was denied on two grounds: one procedural and
one substantive. (Doc. 27). The Court denied plaintiffs'
motion because it did not comply with the procedural
requirements as set out in Local Rule 15, requiring
“[a] party moving to amend or supplement a pleading
pursuant to Federal Rule of Civil Procedure 15(a)(2) or (d)
must describe in the motion the changes sought . . ..”
LR 15; (Doc. 27 at 7). Plaintiffs provided no explanation in
their motion as to the changes they sought to make to their
original complaint and did not provide a copy of the amended
complaint indicating the changes. Id. Substantively,
plaintiffs' motion did not allege any facts in order to
establish good cause to amend the complaint, as required by
Rule 16(b) because the deadline to amend had passed.
Id. at 9-13. Subsequently on January 18, 2017,
plaintiffs moved the Court for an order extending the trial
deadlines (Doc. 28), which the Court granted in part and
denied in part (Doc. 45).
seek to amend their complaint to add John Lucken and his wife
Mary Lucken individually in addition to being plaintiffs in
their capacity as trustees. Plaintiffs also seek to add Does
1-100 inclusive as defendants. (Doc 33-1 at 1). Other than
their intention to add additional parties, plaintiffs seek
only to add factual allegations based on new information
learned through discovery. (Doc. 33).
discussed above, plaintiffs' first motion to amend
suffered from both procedural and substantive deficiencies.
(Doc. 27). Plaintiffs failed to comply with Local Rule 15 in
that they did not indicate in their motion to amend nor their
proposed amended complaint the changes that had been made,
and they did not meet the good cause standard under Federal
Rule 16(b) requiring they show good cause to amend their
complaint and that they missed the scheduled deadline due to
“excusable neglect.” (Doc. 27, at 12). In their
present motion for reconsideration of the previous order and
second motion for leave to amend the complaint, plaintiffs
attempt to correct these deficiencies.
Compliance with Local Rule 15
Rule 15 states, “[a] party moving to amend or
supplement a pleading pursuant to Federal Rule of Civil
Procedure 15(a)(2) or (d) must describe in the motion the
changes sought . . ..” LR 15; (Doc. 27 at 7). In their
previous motion to amend plaintiffs did not explain in their
motion, or any document attached, the changes to the
complaint, and did not attach a copy of the amended complaint
that showed the intended changes. This gave defendants and
the Court no meaningful opportunity to assess the proposed
changes without comparing side by side the two complaints.
their motion for reconsideration of the order denying their
first motion to amend and their second motion to amend,
plaintiffs attached a “redlined” version of their
amended complaint. (Doc. 33-1). The “redlined”
version of the amended complaint shows the intended changes
and is accompanied by a summary of new evidence submitted to
support plaintiffs' motion to amend. (Doc. 33-3). The
summary of new evidence lays out the new evidence and
cross-references the paragraphs added in the amended
complaint to incorporate the new factual allegations.
(Id.). Defendants do not resist this motion. (Doc
33-1). Although plaintiffs' explanation of the intended
changes to the document is not extensive and does not reflect
all the changes, the “redlined” amended complaint
and accompanying summary of new evidence is sufficient to
comply with Local Rule 15.
Good Cause Showing
their previous motion to amend (Doc. 24), plaintiffs did not
allege any facts to demonstrate diligence in meeting the
scheduled deadline to amend pleadings necessary to prove good
cause or demonstrate excusable neglect. (Doc. 24, at 1-3). As
this Court discussed in the prior order denying leave to
amend the complaint (Doc. 27), the applicable standard when a
party seeks to amend a pleading after the deadline to amend
has expired is the good cause standard set out in Rule 16(b).
(Doc. 27, at 12); see Sherman v. Winco Fireworks,
Inc., 532 F.3d 709, 715-16 (8th Cir. 2008). “The
primary measure of good cause is the movant's diligence
in attempting to meet the order's requirements.”
Id. at 716 (quoting Rahn v. Hawkins, 464
F.3d 813, 822 (8th Cir. 2006)). Additionally, “Federal
Rule of Civil Procedure ...