Opinion
03-CV-6509L.
July 8, 2005
REPORT RECOMMENDATION
PRELIMINARY STATEMENT
By order dated June 4, 2004, the above-captioned matter has been referred to the undersigned for the supervision of pre-trial discovery and the hearing and disposition of all non-dispositive motions, pursuant to 28 U.S.C. §§ 636(b)(A) and (B). (Docket # 16). Plaintiff Douglas Sengillo ("Sengillo") has filed suit against his former employer and various of its employee benefit plans, alleging that he was discriminated against in violation of the Americans with Disabilities Act ("ADA"), the Age Discrimination in Employment Act ("ADEA") and the New York Human Rights Law ("HRL"). (Docket # 1). Currently pending before this Court is Sengillo's motion for leave to amend his complaint in order to add a claim for breach of contract. (Docket # 32).
The Complaint also alleged a violation of the Employee Retirement Income Security Act ("ERISA"). That claim was dismissed by the district court by Order dated June 14, 2004. (Docket # 26).
Sengillo was employed by Valeo Electrical Systems, Inc. and Valeo S.A. (collectively "Valeo") for twenty-two years until his termination in April, 2001. (Complaint (Docket # 1), ¶¶ 17, 18). Sengillo's Complaint asserts that he received positive performance appraisals throughout his tenure and indeed had been promoted shortly before his termination. ( Id. at ¶ 27).
In the late 1990s, Valeo purchased the facility in which Sengillo worked. (Affirmation of Douglas Sengillo, dated December 13, 2004 (Docket # 43), ¶ 4). Shortly thereafter, according to Sengillo, Valeo began to experience financial difficulties and reduced its workforce. ( Id.). Long-term employees terminated pursuant to the reduction in force generally received severance packages in the range of $40,000 to $60,000. ( Id.). Alternatively, employees who were terminated "for cause" did not receive severance pay. ( Id.). Sengillo also alleges that Valeo permitted terminated non-union employees (such as Sengillo) to join the unionized workforce, which enabled those employees to continue to earn retirement credit. ( Id. at ¶ 5). According to his calculations, had he been hired to join the union workforce following his termination, he would have fully vested in his retirement pension plan within approximately two years. ( Id.).
Shortly before Sengillo's termination, a new manager was assigned to his work group and began reducing the group's headcount. Sengillo alleges that instead of instituting a standard reduction in force plan, which would have required Valeo to pay severance packages to affected employees, the manager issued performance warning notices to various employees, including Sengillo. ( Id. at ¶ 6). Approximately three weeks later, Sengillo was informed that he was being terminated "for cause" because he had allegedly engaged in unethical behavior with a supplier. ( Id. at ¶ 7). He was further informed that he would not receive severance pay, nor would he be permitted to return to the hourly workforce. ( Id. at ¶ 7).
Sengillo asserts that he denied the allegations of unethical behavior and threatened to seek legal counsel. According to Sengillo, Valeo eventually agreed that it would classify his termination as part of a reduction in force if he would sign a separation agreement promising not to file legal action. ( Id. at ¶ 8). Sengillo claims that at the time of his termination, Valeo was hiring for positions with its Rochester-based Wipers Division. Sengillo intended to apply for such a position, believing that, if hired, he would then continue to vest in the pension plan and would receive medical benefits. ( Id. at ¶ 11). Assuming that he would be considered by the Wipers Division only if his termination had resulted from a reduction in force, Sengillo insisted that he would sign the separation agreement only if his termination was considered part of a reduction in force plan. ( Id. at ¶ 12).
A separation agreement was executed by Sengillo on May 31, 2001. (Docket # 39, Attachment). The terms of the agreement provided for severance pay to Sengillo in return for a release of claims by Sengillo. ( Id.). In the first section of the agreement, entitled "Premises," the language provides, "Employer is terminating Employee's at-will employment as part of a reduction force." ( Id.).
After signing the separation agreement, and shortly after his termination, he applied for a position with the Wipers Division. The manager of that division, defendant Dennis Clark, refused to consider the application, advising Sengillo that he understood that Sengillo had been terminated due to poor performance, not as a part of a reduction in force. Sengillo contacted Clark and attempted to explain that his termination had not been "for cause," but Clark responded that he was "quite sure" of the reason Sengillo was terminated. ( Id. at ¶ 14).
Sengillo initially filed a charge of retaliation with the Equal Employment Opportunity Commission and then, on October 20, 2003, he filed the instant Complaint. (Docket # 1). On July 20, 2004, this Court issued a scheduling order requiring that all motions to amend the pleadings be filed by August 23, 2004, and that all factual discovery be completed by December 31, 2004. (Docket # 29).
His original Complaint included claims that he was discriminated against in violation of the ADA, the ADEA and the New York HRL when Valeo failed to rehire him in its Wipers Division following his termination. It did not, however, include a claim for breach of contract based upon the separation agreement. That claim was not included, Sengillo maintains, because he did not believe at that time that Valeo would dispute the reasons for his termination. Rather, it was not until in September 2004, nearly one year after the Complaint was filed, that he learned from a letter Valeo sent to his counsel that Valeo intended to argue that Sengillo had been terminated for ethical violations, rather than as part of a reduction in force. (Docket # 45). Approximately three weeks after receipt of the letter — which was approximately six weeks after the expiration of the deadline for filing amended pleadings — Sengillo moved to amend his Complaint to allege a claim for breach of contract. (Docket # 32).
Valeo opposes Sengillo's motion on the grounds that good cause has not been shown for the late motion and because such motion is futile. (Docket # 39). For the following reasons, it is the recommendation of this Court that Sengillo's motion be denied.
DISCUSSION
A. Amendment of the Complaint : When deciding a motion to amend filed after a court-ordered deadline for amending the pleadings, a court must balance the requirements of Rules 15(a) and 16(b) of the Federal Rules of Civil Procedure. See Parker v. Columbia Pictures Indus., 204 F.3d 326, 339 (2d Cir. 2000). Rule 15(a) provides that once the time for amending a pleading as of right has expired, a party may request leave of the court to amend, which "shall be freely given when justice so requires." Fed.R.Civ.P. 15(a). Generally, under Rule 15, if the underlying facts or circumstances relied upon by the party seeking leave to amend may be a proper subject of relief, the party should be afforded the opportunity to test the claim on its merits. See United States ex rel. Maritime Admin. v. Continental Illinois Nat'l Bank and Trust Co. of Chicago, 889 F.2d 1248, 1254 (2d Cir. 1989). "In the absence of any apparent or declared reason — such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc. — the leave sought should, as the rules require, be `freely given.'" Foman v. Davis, 371 U.S. 178, 182 (1962).Conversely, Rule 16(b) directs the court to enter a scheduling order that limits the time to amend the pleadings. Fed.R.Civ.P. 16(b)(1). Moreover, the rule also provides that "[a] schedule shall not be modified except upon a showing of good cause and by leave of the [court]." Fed.R.Civ.P. 16(b). See Parker v. Columbia Pictures Indus., 204 F.3d at 340
In Parker v. Columbia Pictures Indus., 204 F.3d at 340, the Second Circuit addressed the showing required of a party moving to amend its pleadings after the time for filing such motions had expired. In that case, the court joined several other courts in determining that "the Rule 16(b) `good cause standard,' rather than the more liberal standard of Rule 15(a), governs a motion to amend filed after the deadline a district court has set for amending the pleadings." Id. (citing Sosa v. Airprint Sys., Inc., 133 F.3d 1417, 1419 (11th Cir. 1998) ( per curiam) (considering Rule 15(a) without regard to Rule 16(b) would render scheduling orders meaningless); In re Milk Prods. Antitrust Litig., 195 F.3d 430, 437 (8th Cir. 1999) (court may require showing of good cause for motion to amend filed after deadline set forth in scheduling order), cert. denied, 529 U.S. 1038 (2000); Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 610 (9th Cir. 1992) (Rule 16 was drafted to provide court with control over its docket and to prevent disruption, and thus denying leave to amend for lack of good cause shown is not abuse of discretion); Riofrio Anda v. Ralston Purina Co., 959 F.2d 1149, 1154-55 (1st Cir. 1992) (finding that it was not an abuse of discretion to deny leave to amend pursuant to Rule 16, despite lenient standards of Rule 15); Covington v. Kid, 1999 WL 9835, *3 (S.D.N.Y. 1999) (requiring that showing of good cause be made by plaintiff seeking to amend pleadings after time to amend had expired); Carnrite v. Granada Hosp. Group, Inc., 175 F.R.D. 439, 446 (W.D.N.Y. 1997) (same); Mayes v. Local 106, Int'l Union of Operating Eng'rs, 1992 WL 335964, *9 (N.D.N.Y. 1992) (same)).
According to the Second Circuit, "despite the lenient standard of Rule 15(a), a district court does not abuse its discretion in denying leave to amend the pleadings after the deadline set in the scheduling order where the moving party has failed to establish good cause." Parker v. Columbia Pictures Indus, 204 F.3d at 340. See Phaneuf v. Tenneco, Inc., 938 F. Supp. 112, 115 (N.D.N.Y. 1996) ("In instances where . . . a considerable amount of time has passed between filing the complaint and the motion to amend, courts have placed the burden upon the movant to show some valid reason for his or her neglect and delay") (internal quotation marks omitted) (quoting Sanders v. Thrall Car Mfg. Co., 582 F. Supp. 945, 952 (S.D.N.Y. 1983), aff'd, 730 F.2d 910 (2d Cir. 1984)).
Moreover, in deciding a motion to amend, the court must weigh the good cause shown for the delay against the prejudice imposed upon the non-moving party. Evans v. Syracuse City School Dist., 704 F.2d 44, 46-47 (2d Cir. 1983). "The longer the period of an unexplained delay, the less will be required of the nonmoving party in terms of a showing of prejudice." Id. at 47 (quoting Advocat v. Nexus Indus. Inc., 497 F. Supp. 328, 331 (D. Del. 1980)); Phaneuf v. Tenneco, Inc., 938 F. Supp. at 115.
In the case at bar, Sengillo filed his original Complaint on October 20, 2003. (Docket # 1). The scheduling order issued by this Court required that all motions to amend the pleadings be filed by August 23, 2004. On October 7, 2004, approximately one year after filing the Complaint, and six weeks after the deadline for filing motions to amend the pleadings had expired, Sengillo filed the pending motion to amend seeking to include an additional claim for breach of contract.
In support of his motion, Sengillo cites only Fed.R.Civ.P. 15, arguing that leave to amend should be granted freely. Sengillo fails, however, to offer any showing of good cause for the failure to move to amend within the scheduling deadline; nor does Sengillo contend that he was unable to include the breach of contract claim within his original Complaint. Rather, Sengillo claims only that he did not initially include a claim for breach of contract because he "never expected that [Valeo] would do anything other than admit a binding contract was in place that set for[th] the parties' agreement as to the reasons for [his] termination." (Docket # 45). This expectation, the good faith of which this Court does not question, is curious considering the allegation contained in the original Complaint that in retaliation for Sengillo's exercise of his protective rights, "the defendant misstate[d] the reasons behind plaintiff's termination as being `termination based upon poor performance' and not as `part of a reduction in force.'" (Docket # 1, ¶ 28). In any event, during oral argument before this Court, Sengillo's counsel conceded that he possessed all of the facts necessary to plead a breach of contract claim at the time of initial pleading. (Docket # 46).
Applying the above-cited authority to this record, I find that Sengillo has not demonstrated good cause for failing to seek leave to amend within the time period designated in this Court's order. See Phaneuf v. Tenneco, Inc., 938 F. Supp. at 116. (denying plaintiff's request to amend complaint to add new cause of action because he had all of the information that was needed to include the claim at the time of initial pleading).
B. Futility of Motion : Valeo also opposes plaintiff's motion to amend on the grounds of futility. Although I have reservations as to whether plaintiff's breach of contract claim, based as it is on language contained in the "Premises" clauses of the agreement, could survive a motion to dismiss, I do not need to reach this question. Here, where plaintiff has failed entirely to establish good cause for his failure to comply with this Court's scheduling order, that fact alone justifies denial of his motion to amend.
CONCLUSION
For the foregoing reasons, it is my recommendation that Sengillo's motion to amend his complaint (Docket # 32) be DENIED.IT IS SO ORDERED.
Pursuant to 28 U.S.C. § 636(b)(1), it is hereby
ORDERED, that this Report and Recommendation be filed with the Clerk of the Court.
ANY OBJECTIONS to this Report and Recommendation must be filed with the Clerk of this Court within ten (10) days after receipt of a copy of this Report and Recommendation in accordance with the above statute, Fed.R.Civ.P. 72(b), 6(a) and 6(e) and Local Rule 72.3(a)(3).
The district court will ordinarily refuse to consider on de novo review arguments, case law and/or evidentiary material which could have been, but was not, presented to the magistrate judge in the first instance. See e.g. Patterson-Leitch Co., Inc. v. Massachusetts Municipal Wholesale Electric Co., 840 F.2d 985 (1st Cir. 1988).
Failure to file objections within the specified time or to request an extension of such time waives the right to appeal the District Court's Order. Thomas v. Arn, 474 U.S. 140 (1985); Small v. Secretary of Health and Human Services, 892 F.2d 15 (2d Cir. 1989); Wesolek v. Canadair Ltd., et al., 838 F.2d 55 (2d Cir. 1988).
The parties are reminded that, pursuant to Rule 72.3(a)(3) of the Local Rules for the Western District of New York, "written objections shall specifically identify the portions of the proposed findings and recommendations to which objection is made and the basis for such objection and shall be supported by legal authority." Failure to comply with the provisions of Rule 72.3(a)(3), or with the similar provisions of Rule 72.3(a)(2) (concerning objections to a Magistrate Judge's Decision and Order), may result in the District Court's refusal to consider the objection.
Let the Clerk send a copy of this Order and a copy of the Report and Recommendation to the attorneys for the Plaintiff and the Defendant.
IT IS SO ORDERED.