United States District Court, D. Nebraska
THE EDGE IN COLLEGE PREPARATION, LLC, a New York limited liability company; Plaintiff,
PETERSON'S NELNET, LLC, a Nebraska limited liability company; Defendant.
MEMORANDUM AND ORDER
R. ZWART UNITED STATES MAGISTRATE JUDGE.
ECP's complaint was filed on December 22, 2016. ECP
alleges that pursuant to a contract between the parties, ECP
agreed to produce, and Peterson's agreed to purchase, a
text manuscript with tips and strategies for preparing for
the ACT examination. Plaintiff's complaint alleges
Defendant breached that contract and infringed on
Plaintiff's copyright by publishing and selling ACT
preparation books titled "Peterson's ACT Prep
Guide" and "Peterson's ACT Prep Guide
Plus" that included Plaintiff's work. (Filing No. 1
¶ 22 at CM/ECF p. 4). ECP now moves to amend
the complaint to add contract and copyright claims arising
from the 2017 ACT Prep Guide books published and sold by
Peterson's (Filing No. 58), and potentially the 2018 ACT
Prep Guide books which have yet to be published. (See Filing
No. 64). For the reasons stated below, the motion will be
to Rule 16(b)(4), a case management order setting progression
deadlines “may be modified only for good cause and with
the judge's consent.” Fed.R.Civ.P. 16(b)(4).
“The primary measure of Rule 16's ‘good
cause' standard is the moving party's diligence in
attempting to meet the case management order's
requirements. . . ., [but the] ‘existence or degree of
prejudice to the party opposing the modification' and
other factors may also affect the decision.”
Bradford v. DANA Corp., 249 F.3d 807, 809 (8th Cir.
2001). In general, the court will not consider prejudice, or
the lack thereof, if the movant has not been diligent in
meeting the scheduling order's deadlines. Sherman v.
Winco Fireworks, Inc., 532 F.3d 709, 716-17 (8th Cir.
2008). The movant's level of diligence and the degree of
prejudice to the parties are both factors to consider when
assessing if good cause warrants extending a case management
deadline, with the movant's diligence being the first
consideration and the extent of prejudice to either party
considered only following a requisite threshold finding of
due diligence. Id.; Marmo v. Tyson Fresh Meats,
Inc., 457 F.3d 748, 759 (8th Cir. 2006).
August 16, 2017, the court entered a case progression order
which set September 29, 2017 as the deadline for moving to
amend pleadings in accordance with the parties' Rule
26(f) report. (Filing No. 35). Plaintiff's motion was
filed on January 26, 2018. In its proposed amended complaint,
ECP alleges that Peterson's continued to infringe on its
copyright when it published its 2017 ACT preparation books
“Peterson's ACT Prep Guide (2017)” and
“Peterson's ACT Prep Guide Plus (2017)” (the
“ 2017 editions”). (Filing No. 58-1). In
addition, ECP indicates it is possible Peterson's 2018
ACT preparation books will continue to infringe on its
copyright once they are published later this month and if so,
ECP seeks to add claims concerning those works. (See Filing
argues it was diligent in attempting to meet the ordered
deadlines, explaining it first discovered the 2017 editions
may infringe on ECP's copyright during an October 2017
deposition. ECP argues that after that deposition, it
promptly sought discovery from Peterson's on this issue.
should hesitate to allow amendment where the infringing
product or information relating to the product was publicly
available prior to the time for filing Plaintiff's
infringement contentions. See, e.g., CANVS Corp.
v. United States, 107 Fed.Cl. 100 (Fed. Cl. 2012);
Catch a Wave Techs., Inc. v. Sirius XM Radio, Inc.,
No. C 12-05791 WHA, 2014 WL 186405 (N.D. Ca. 2014) (denying
Plaintiff's motion to amend its infringement contentions
to add a device where information regarding the device was
publicly available months earlier); Global Sessions LP v.
Travelocity.com LP, No. 6:10cv671 LED-JDL, 2012 WL
1903903 *4 (E.D.Tex. May 25, 2012) (denying leave to amend
infringement contentions to include information that was
publicly available at the time that the original infringement
contentions were due); SmartPhone Techs., LLC v. HTC
Corp., No. 6:10cv580 LED-JDL, 2012 WL 1424173, at *3
(E.D.Tex. Mar. 16, 2012) (finding a lack of diligence where a
party omitted from its initial infringement contentions three
accused devices that were publicly available at the time that
infringement contentions were due). To the extent that the
failure to find the relevant information in the time allotted
was simply a careless mistake, this also is insufficient to
establish good cause. Berger v. Rossignol Ski Co.,
2006 WL 1095914 *5 (N.D. Ca. 2006)(“Carelessness or
mere errors ... are insufficient to establish good
releases a new edition of its ACT guides every April. The
2017 editions were publicly available for purchase from
several major retailers beginning April of 2017-around three
months prior to the parties filing their Rule 26(f) report
and five months before the deadline to amend pleadings. ECP
claims it was not required to purchase and examine each of
Peterson's 2017 ACT texts to meet the diligence standard.
While the court partially agrees, ECP cannot in good faith
claim it was surprised by the fact that Peterson's (like
every other publisher in its industry) annually publishes
updated editions of its test preparation books, including the
ACT Prep Guide series. ECP does not convincingly show that it was
unable to discover the existence of the 2017 editions of the
ACT Prep Guide series and purchase them prior to the
September deadline for amending its complaint..
the court is hesitant to find good cause and allow an
amendment under Rule 16(b)(4), in this specific
instance, the court believes that applying Rule 16 would be
counter to the overarching principle to construe and
administer the Federal Rules “to secure the just,
speedy, and inexpensive determination of every action and
proceeding.” Fed.R.Civ.P. 1.
Plaintiff is not able to amend its pleadings, Plaintiff will
file an additional lawsuit alleging the new facts and claims
addressed in the proposed amended complaint and will
additionally seek to stay this lawsuit until a determination
is reached regarding the consolidation of the two cases. (See
Filing No. 58-1). Under Rule 42 of the Federal Rules of Civil
Procedure, multiple cases before a federal court may be
consolidated if they involve a common question of law or
fact, and consolidation would assist in avoiding unnecessary
cost or delay. Fed.R.Civ.P. 42(a). Consolidation is warranted
when the actions involve common parties, overlapping legal
issues, and related factual scenarios, and the consolidation
itself will not cause unfair prejudice. Horizon Asset
Management Inc. v. H & R Block, Inc., 580 F.3d 755,
768 -769 (8th Cir. 2009). Between this case and the potential
new case which would no doubt arise, the parties, claims, and
issues will essentially be identical. A motion to consolidate
would be readily granted.
the court finds Plaintiff has been diligent in pursuing
whether the 2018 editions of the ACT Prep Guide books
infringe on its copyright, as these books are not yet
publicly available, and the court does not find that
Peterson's will be prejudiced in allowing the complaint
to be amended to include those editions.
light of Rule 1's mandate, strict enforcement of Rule
16(b)(4) in this case would result in an additional action
which must then be consolidated with the captioned case.
These procedural maneuvers will ultimately cause significant
time, expense, and burden to both parties for no discernable
reason. Moreover, the court anticipates another proposed
amendment to add the 2018 editions in this lawsuit, and
applying the good cause standard, the court will likely grant
that motion. If the court refuses an amendment to add the
2017 claims to this lawsuit, the above-captioned case will
include the 2016 and 2018 alleged infringements, while the
2017 infringements will be alleged in a separate lawsuit.
That procedural posture makes little sense and it undermines
the goal of providing a just, speedy, and efficient
resolution of the parties' claims.
argues that allowing ECP's amendment would cause delay to
the instant action as this case may be dismissed on summary
judgment. The court does not find this argument availing. As
addressed above, it is already possible that progression will
be delayed to address the 2018 editions and the court finds
that any additional risk of delay pales in comparison to the
time and expense required for another lawsuit to be filed,
progressed, and ultimately be consolidated with this ...