Free Motion to Amend Pleadings - Rule 15 - District Court of Federal Claims - federal

Case 1:05-cv-00448-NBF

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS

RAYTHEON COMPANY,
Plaintiff,
v.

) )
) ) ) ) ) ) ) ) )

No. 05-448C
Judge Firestone

UNITED STATES OF AMERICA,

Defendant.

PLAINTIFF'S MOTION FOR LEAVE TO AMEND COMPLAINT
Pursuant to Rule 15 of the Rules of the United States Cour of Federal Claims, Plaintiff
Raytheon Company ("Raytheon") respectfully requests leave to amend its Complaint to conform
its claimed segment closing adjustment amounts to the segment closing calculations of its expert,

Steven G. Vernon, FSA, EA, as set forth in Raytheon's Rebuttal Expert Report dated November

30,2007. The proposed amendments will not require deviation from the curent case schedule as

set forth in the Cour's Scheduling Order dated November 16,2007. Furthermore, the proposed

amendments will not necessitate additional fact discovery because the amendments simply
amend the claim amounts, not the allegations set forth in Raytheon's original Complaint. At the

most, such amendments may only necessitate minimal additional expert discovery which is
curently ongoing. Indeed, the paries have over three more months to conduct expert discovery

as the current deadline for the close of expert discovery is March 7, 2008. This is Raytheon's

first request to amend its Complaint.

RCFC 15(a) states that leave to amend "shall be freely given when justice so requires."
As the Federal Circuit has acknowledged:

Rule 15(a) declares that leave to amend "shall be freely given when justice so requires"; this mandate is to be heeded....If the underlying facts or circumstances

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relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded an opportity to test his claim on the merits. In the absence of any
apparent or declared reason-such as undue delay, bad faith or dilatory motive on

the par of the movant, repeated failure to cure deficiencies by amendments
previously allowed, undue prejudice to the opposing pary by virtue of allowance of the amendment, futility of amendment, etc.-the leave sought should, as the rules require, be "freely given."
Te-Moak Bands of Western Shoshone Indians v. United States, 948 F.2d 1258, 1260 (Fed.Cir.
1991) quoting Fornan v. Davis, 371 U.S. 178, 182,83 S.Ct. 227 (1962). As discussed below,

none of the factors identified as necessitating the denial of a motion for leave to amend - undue
delay, bad faith or dilatory motive, repeated failure to cure deficiencies by previously allowed

amendments, undue prejudice to Defendant, or futility of amendment - are present in this action.

First, there has been no undue delay. In the course of responding to the Governent's
Expert Report, Raytheon submitted its Rebuttal Expert Report on November 30, 2007, wherein

Raytheon's Expert, Steven G. Vernon, FSA, EA, set forth the bases for his segment closing

calculations for the Aircraft Integration System, Raytheon Aerospace, Optical Systems and
Printed Wire Fabrication segments. Mr. Vernon's segment closing adjustment amounts differ

slightly from the amounts utilized to prepare the Governent's share of the pension and postretirement benefit adjustment amounts that are included in Raytheon's Complaint for these four
segments. Raytheon's original calculations were based on the calculations of Raytheon's
actuar, Mercer Human Resource Consulting. However, as stated in Mr. Vernon's Rebuttal
Expert Report:

Because we independently performed calculations, we did not expect to match Mercer's results precisely to the dollar. In some instances, we found that Mercer understated the segment closing adjustments. In other instances, we found that Mercer overstated the segment closing adjustments. However, in general, our results were not materially different....In my opinion, the amounts we have calculated are more appropriate measurements of the applicable segment closing adjustment amounts than the amounts Mercer calculated for the reasons explained in this report.

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Raytheon's Rebuttal Expert Report, p. 4. Accordingly, to be consistent with its independent
expert's calculations, Raytheon has moved promptly to amend its Complaint to conform the
claimed segment closing adjustment amounts to the calculations set forth in its Rebuttal Expert
Report dated November 30, 2007.

Second, there is no bad faith or dilatory motive for seeking this amendment. Raytheon's

amendments to its Complaint are not sought as a dilatory measure or for the puroses of delay.
Furhermore, Raytheon's proposed amendments are not made in bad faith since the bases for its
amendments are the actuaral calculations prepared by Raytheon's independent expert in this

litigation. As stated in Mr. Vernon's Rebuttal Expert Report:
Actuarial calculations are inherently imprecise as they involve assumptions about futue events, e.g., incidences of retirement and death, where actual experience could be different from the assumptions used. Note that actuaries may differ in their conclusions even when applying reasonable assumptions and appropriate
methods. Also, actuares may arve at similar conclusions even when using

different approaches to the issue at hand.

Raytheon's Rebuttal Expert Report, pp. 7-8. Raytheon proposes its amendments in good faith
and with no improper motive.

Third, this is Raytheon's first request to amend its Complaint and therefore, there have
been no "repeated failure(s) to cure deficiencies" pursuant to previous amendments.
Four, Defendant wil not be unduly prejudiced by these amendments. Raytheon does

not seek to amend the allegations set forth in its original Complaint. Instead, Raytheon seeks to
amend only the dollar amounts of its claims. Furthermore, allowing the amendment will result in

little additional expert discovery. Expert discovery is ongoing and Defendant will not be
prejudiced by Raytheon's proposed amended Complaint at this juncture in the litigation.

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Fifth and finally, the proposed amendments are not futile. To determine whether a
proposed amendment is futile, cours "simply decide whether a pary's proposed amendment is

facially meritless and frivolous." Sf. Paul Fire and Marine Ins. Co. v. Us., 31 Fed.Cl. 151
(1994). The bases for Raytheon's proposed amendments are its expert's independent settlement
closing adjustment calculations which are set forth in a 100+ page Rebuttal Expert Report. Such
amendments are far from facially meritless and frivolous.

Given that motions to amend are liberally granted and because none of the concerns that
would preclude such a ruling is present in this case, Raytheon respectfully requests that the Cour

grant this Motion for Leave to Amend its Complaint and permit the filing of Raytheon's First
Amended Complaint attached to this Motion as Exhibit A.

Counsel for Raytheon contacted counsel for Defendant to request Defendant's consent to

the relief set forth in this Motion. Counsel for Defendant stated that he did not want to take a
position on this Motion until after he reviewed Raytheon's First Amended Complaint.
Respectfully submitted,

Date: November 30, 2007

s/Karen L.Manos Karen L. Manos, Esq.

GIBSON, DUN & CRUTCHER LLP
1050 Connecticut Avenue, NW Washington, DC 20036 Telephone: (202) 955-8536 Facsimile: (202) 530-9533

kmanos(fgibsondun.com
Attorney of Record for Plaintiff RA YTHEON COMPANY
Of Counsel:

Christyne K. Brennan, Esq.

GIBSON, DUN & CRUTCHER LLP
1('0"4.,97.1 .I)OC

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CERTIFICA TE OF SERVICE

I hereby certify that on the 30th day of

November, 2007, a copy of

the foregoing

Plaintiffs Motion for Leave to Amend Complaint was filed electronically. I understand that
notice of this filing will be sent to all paries by operation of

the Cour's electronic filing system.

Paries may access this filing through the Cour's system.

s/Chrstye K. Brennan

Christyne K. Brennan

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