Free Reply to Response to Motion - District Court of Colorado - Colorado

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

Document 113

Filed 09/02/2005

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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 REPLY IN SUPPORT OF ITS MOTION FOR LEAVE TO AMEND ANSWER TO ADD AFFIRMATIVE DEFENSE

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

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Fed.R.Civ.P. 15(a) provides that "leave [to amend] shall be freely given when justice so requires." The purpose of this liberal standard is to insure that decisions are based on the merits of a case and not on technicalities. 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 insure that mere technicalities would not prevent decisions based on the merits); Filmtek Corp. v. Hydronautics, 67 F.3d 931, 935 (Fed.Cir. 1995)(stating that a court must be guided by the underlying purpose of Rule 15 to facilitate decision on the merits rather than technicalities). See also Conley v. Gibson, 355 U.S. 41, 48 (1957)(stating that pleading is not "a game of skill in which one misstep by counsel may be decisive to the outcome."). The party opposing a request to amend bears the burden of showing a reason why the requested leave to amend should be denied. See Lange v. CIGNA Individual Financial Services Co., 759 F.Supp. 764, 769-70 (D.Kan. 1991). There are very limited situations in which a court may properly exercise its discretion and deny a request for leave to amend. Defendants have essentially raised two. They claim prejudice by the delay in Quizno's assertion of the statute of limitations defense. They also allege the delay was "undue," or that Quizno's engaged in bad faith, dilatory motive or flagrant abuse. Prejudice sufficient to warrant denial of a request to amend is limited to those situations where the opposing party will incur "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. Delay alone is not a sufficient reason to deny a motion for leave to amend. Rachmon Bag Co. v. Liberty Mut. Ins. Co., 46 F.3d 230, 234-35 (2nd Cir. 1991)(court properly allowed amendment to add defense four years into trial because plaintiff failed to show prejudice); United States v. Pend Orielle Public

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

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Util. Dist. No. 1, 926 F.2d 1502, 1511 (9th Cir. 1991)(court abused its discretion by denying request to amend when only factor considered was delay.) Defendants have not shown or alleged any difficulty in prosecuting their case arising from any delay. They have not alleged that they would have done anything differently had the statute of limitations defense been asserted earlier. They cannot point to any discovery or additional fact-finding they would have done. Moreover, trial is not set to begin for months and, in any event, it is clear that Defendants have already had sufficient time to prepare their position with respect to the statute of limitations defense because they have already done so in responding to Quizno's Motion for Summary Judgment. Defendants have likewise failed to show that the delay in asserting the affirmative defense of statute of limitations was "undue" or that Quizno's engaged in bad faith, dilatory motive or flagrant abuse. Quizno's learned of the facts supporting this defense at April 6, 2005 deposition of Royce Gwin. Quizno's moved for leave to assert the affirmative defense within four months of that date and well before the Pretrial Order was prepared and well before trial. Defendants challenge that Quizno's learned of the validity of this defense at Mr. Gwin's deposition. Defendants state that Quizno's knew of the one year statute of limitations clause in its contract before Mr. Gwin's deposition and that Quizno's knew the Defendants' position when Defendants filed their counterclaims alleging that the development quotas were unconscionable. That is true. However, the applicability of this defense was revealed when, at his deposition, Mr. Gwin testified he learned the facts supporting his purported unconscionability claim in the fall of 1998. It was then that Quizno's learned that Defendants' purported claim accrued in 1998. This, Defendants do not address.

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

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Dated this 2nd day of September 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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Case 1:04-cv-01062-ZLW-BNB

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CERTIFICATE OF SERVICE I hereby certify that on September 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 September 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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