Free Motion for Leave - District Court of Colorado - Colorado

Case 1:04-cv-01062-ZLW-BNB

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 04-cv-01062-ZLW-BNB THE QUIZNO'S MASTER LLC and THE QUIZNO'S FRANCHISE COMPANY LLC, Plaintiffs, v. R&B MANAGEMENT GROUP, LLC, an Alabama limited liability company, ROYCE GWIN, an individual, and REBECCA GWIN, an individual Defendants. QUIZNO'S MOTION FOR LEAVE TO AMEND ANSWER TO ADD AFFIRMATIVE DEFENSE Plaintiffs The Quizno's Master LLC and The Quizno's Franchise Company LLC ("Quizno's") through undersigned counsel, hereby move for leave to amend their Answer to add affirmative defense and in support states as follows: CERTIFICATE OF COMPLIANCE WITH COLO.L.R. 7.1 Undersigned counsel certifies he conferred with counsel for Defendants regarding the relief requested in this Motion and that Defendants oppose the relief requested herein. 1. On December 20, 2004 Quizno's filed its Plaintiffs' Answer to Defendants'

Amended Counterclaims. 2. 3. On April 6, 2005, Quizno's deposed Defendant Royce Gwin. At his deposition, Mr. Gwin revealed that he had learned all of the facts giving

rise to his claim that the development quota in the Area Director Marketing Agreement
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("ADMA") between the parties was unconscionable and, therefore, unenforceable in the November or December 1998 timeframe. 4. Quizno's has filed a Motion for Summary Judgment raising, among other things,

that the one year statute of limitations in the ADMA bars this claim. 5. Defendants responded by arguing that Quizno's waived the statute of limitation

defense by not raising it as an affirmative defense in Quizno's Answer. 6. In response to that argument, Quizno's is herein requesting leave to amend to add

statute of limitations as an affirmative defense. 7. Fed.R.Civ.P. 15(a) provides that "leave [to amend] shall be freely given when

justice so requires." This liberal pleading standard applies to requests to amend affirmative defenses, including statute of limitations. See e.g., Phelps v. McClellan, 30 F.3d 658, 663 (6th Cir. 1994); Lange v. Cigna Individual Financial Services Co., 759 F.Supp. 764, 769-70 (D.Kan. 1991). See also, Foman v. Davis, 371 U.S. 178, 181-82 (1962) (reversing trial court's refusal to allow amendment and holding that the Rules of Civil Procedure were designed to ensure that mere technicalities would not prevent decisions based on the merits). 8. In determining whether to grant leave to amend, the court may consider such

factors as undue delay, the moving party's bad faith or dilatory motive, the prejudice an amendment may cause the opposing party and the futility of amendment. Lange, 759 F.Supp. at 769-70. 9. Here, there was no undue delay and Quizno's did not engage in bad faith or have

a dilatory motive. Quizno's counsel learned that facts sufficient to support a statute of limitation defense existed at the April 6, 2005 deposition of Mr. Gwin. Quizno's is seeking leave to amend

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now, less than four months later. Quizno's is seeking to amend now in order to address the issue brought to its attention in Defendants' Response to Quizno's Motion for Summary Judgment. 10. The proposed amendment is not futile. Rather, as can be seen from Quizno's

Motion for Summary Judgment, the defense is valid and dispositive. Indeed, to deny this Motion to Amend and deny the pending Motion for Summary Judgment on the basis that the defense was not raised in the answer would impermissibly allow a technicality to prevent a decision based on the merits. See Forman v. Davis, 371 U.S. 178, 181-82 (1962). 11. To defeat a request to amend a pleading, the party opposing the requested

amendment bears the burden of showing he or she would be prejudiced by allowing the amendment. Lange, 759 F.Supp. at 770 (citing Breck v. Aquaslide N'Dive Corp., 562 F.2d 537 (8th Cir. 1977). "Prejudice under Rule 15 `means undue difficulty in prosecuting [or defending] a lawsuit as a result of a change in tactics or theories on the part of the other party.'" Id quoting Deakyne v. commissioners of Lewes, 416 F.2d 290, 300 (3rd Cir. 1969). Defendants cannot

show sufficient prejudice to warrant denial of this request under the standards of Fed.R.Civ.P. 15. 12. Quizno's learned of the facts supporting this defense at the April 6, 2005

deposition of Royce Gwin. At that time, Defendants had taken all of the depositions they desired, with the exception of a Quizno's employee, who works in the territory at issue and has nothing to do with the issues associated with the statute of limitations defense. Defendants cannot claim prejudice in the delay in raising this affirmative defense, as Defendants have had the facts supporting this defense and will not be able to identify any new or different discovery they would have taken if this defense had been pled earlier.

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13.

Indeed, Defendants have presented their substantive arguments against

application of the statute of limitation defense in their Opposition to Quizno's Motion for Summary Judgment. 14. Furthermore, to the extent Defendants were to identify any additional discovery

they reasonably desire to take to address this defense, Quizno's would not object to such additional discovery. WHEREFORE, Quizno's respectfully requests that this Court grant it leave to file the attached Amended Affirmative Defense and order that the attached Amended Affirmative Defense is deemed filed as of the date of the Court's Order. Dated this 2nd day of August 2005 Respectfully submitted, /s/ Leonard H. MacPhee_________________ Leonard H. MacPhee Attorney for Plaintiffs Perkins Coie LLP 1899 Wynkoop Street, Suite 700 Denver, CO 80202 Telephone: (303) 291-2300 Facsimile: (303) 291-2400 Email: [email protected] and Fredric A. Cohen DLA Piper Rudnick Gray Cary 203 North LaSalle Street, Suite 1800 Chicago, IL 60601 (312) 368-4000

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CERTIFICATE OF SERVICE I hereby certify that on August 2, 2005 I electronically filed the foregoing with the Clerk of Court using the CM/ECF system which will send notification of such filing to the following email addresses:


Gilbert R. Egle [email protected] [email protected]\ Dennis Kaw [email protected] Eldon E. Silverman [email protected] [email protected]



and hereby certify that on August 2, 2005 I have mailed the foregoing to the following non EM/ECF participant via U.S. Mail, postage prepaid: J.E. Sawyer, Jr. Attorney at Law 203 South Edwards Street Enterprise, AL 36330

/s/ Leonard H. MacPhee Leonard H. MacPhee Attorney for Defendant Perkins Coie LLP 1899 Wynkoop Street, Suite 700 Denver, CO 80202 Telephone: (303) 291-2300 Facsimile: (303) 291-2400 Email: [email protected]

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