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New Enterprises Ltd v. Senestech Inc.

United States District Court, D. Arizona

April 5, 2019

New Enterprises Limited, Plaintiff,
v.
SenesTech Incorporated, et al., Defendants.

          ORDER

          JAMES A. TEILBORG SENIOR UNITED STATES DISTRICT JUDGE.

         Pending before the Court is Plaintiff New Enterprises, Ltd.'s (“Plaintiff”) Motion to Amend (Doc. 60) pursuant to Rule 15 of the Federal Rules of Civil Procedure (“Rules”). The Court now rules on the motion.

         I.BACKGROUND

         Plaintiff filed a Complaint (Doc. 1) against Defendants SenesTech, Inc. (“Defendant SenesTech”) and Roth Capital Partners, LLC (“Defendant Roth;” together with Defendant SenesTech, “Defendants”) on February 20, 2018. On December 3, 2018, this Court granted Defendant SenesTech's Motion to Dismiss (Doc. 14) and Defendant Roth's Motion to Dismiss (Doc. 30) without prejudice. (See Doc. 57). Pursuant to this Court's Order (Doc. 57) granting dismissal and its subsequent Order (Doc. 59) granting an extension of time, Plaintiff filed the pending Motion to Amend (Doc. 60) on January 25, 2019. Along with its Motion to Amend (Doc. 60), Plaintiff also filed its proposed First Amended Complaint (Doc. 60-1) and a redline version of the proposed First Amended Complaint against the original Complaint (Doc. 60-2).

         On January 31, 2019, Defendant Roth filed its “Response and Non-Opposition to Plaintiff's Motion to Amend” (Doc. 63). On February 8, 2019, Defendant SenesTech filed a Response (Doc. 64) in opposition to Plaintiff's Motion to Amend, and Plaintiff filed a Reply (Doc. 66) on February 15, 2019.

         II. LEGAL STANDARD

         Rule 15(a) governs motions to amend pleadings before trial. When a party may not amend as a matter of course, Rule 15(a)(2) states that “a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires.” Fed.R.Civ.P. 15(a)(2).

         Because Plaintiff filed the pending Motion outside Rule 15(a)(1)'s 21-day limit and Defendant SenesTech does not give its written consent for the amendments, Plaintiff may only amend its pleading with the Court's leave. See Id. Although the Court has discretion to grant or deny a party's motion for leave to amend a pleading, “Rule 15(a) declares that leave to amend shall be freely given when justice so requires; this mandate is to be heeded.” Foman v. Davis, 371 U.S. 178, 182 (1962) (internal quotation marks and citations omitted). The Ninth Circuit Court of Appeals provides that “this policy is to be applied with extreme liberality.” Morongo Band of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990).

         The extremely liberal policy in favor of amendment is not completely without limitations. The Ninth Circuit has also stated that a court “determines the propriety of a motion to amend by ascertaining the presence of any of four factors: bad faith, undue delay, prejudice to the opposing party, and/or futility. Generally, this determination should be made with all inferences in favor of granting the motion.” Griggs v. Pace Am. Grp., Inc., 170 F.3d 877, 880 (9th Cir. 1999) (internal citations omitted). “The party opposing amendment bears the burden of showing prejudice, ” or one of the other reasons for denying a motion to amend. DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 187 (9th Cir. 1987).

         III. ANALYSIS

         Defendant SenesTech opposes Plaintiff's Motion to Amend on the bases of undue delay and futility. (Doc. 64 at 8, 10). Because the Court will grant leave to amend without prejudice to filing a motion to dismiss pursuant to 12(b)(6), the Court will not analyze Defendant SenesTech's futility arguments for purposes of this Order. Rather, the Court confines its analysis to the other factors that determine the propriety of a motion to amend.

         A. Bad Faith

         Defendant SenesTech does not provide any allegations of bad faith in its Response (Doc. 64), nor does the Court independently find any evidence of bad faith herein. (See generally Doc. 64; see also Doc. 66 at 2). Accordingly, the Court finds that Plaintiff's attempt to amend its original Complaint is not made in bad faith.

         B. ...


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