Free Motion to Amend/Correct - District Court of California - California

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 1 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

BIRNBERG & ASSOCIATES CORY A. BIRNBERG (SBN 105468) JOSEPH SALAMA, ESQ. (SBN 212225) BIRNBERG & ASSOCIATES 703 Market Street, Suite 600 San Francisco, CA 94103 Telephone: (415) 398-1040 Facsimile: (415) 398-2001 Attorneys for Plaintiffs JOHN GIDDING, PIVOTAL, INC.

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION JOHN GIDDING, PIVOTAL, INC. ) ) Plaintiffs, ) ) v. ) ) DEREK ANDERSON, an individual; JOHN ) ZAPPETTINI, an individual; OLIVIER ) LEMAL, and individual; PLANTAGENET ) CAPITAL MANAGEMENT LLC, a ) purported California corporation; ) PLANTAGENET CAPITAL AMERICA ) LLC, a purported Delaware corporation; ) PLANTAGENET CAPITAL FUND LP, a ) purported Cayman Island corporation; ) PLANTAGENET CAPITAL FUND LP II, a ) purported Cayman Island corporation; PLB ) HOLDINGS SA, a purported Luxembourg ) corporation; PLANTAGENET PARTNERS ) SA, a purported French corporation; SA ) SOCIETE CHAMPENOISE ) D'EXPLOITATION VINICOLE, a ) purported French corporation; SERGE ) HAUCHART, an individual; PATRICK ) RAULET, an individual; JEAN-FRANCOIS ) RAPENEAU, an individual; CHRISTOPHE ) RAPENEAU, an individual; SA ) COMPAGNIE DES VINS DU LEVANT, a ) purported French corporation; ) SAS LES CHAMPS RENIER, a purported ) French corporation; Marie-Claude Simon ) an individual; and DOES 1 through 100, ) inclusive, ) Defendants. ) ______________________________________ ) Case No. C-7-04755-JW NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT FRCP Rule 15(a) Date: May 30, 2008 Time: 9:00 a.m. Place: Courtroom 2, 17th Floor, 450 Golden Gate Ave., San Francisco, California

26 27 28

NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

-1-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 2 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

NOTICE OF MOTION NOTICE is hereby given that on May 30, 2008 at 9:00 a.m. or as soon thereafter as counsel may be heard by the above-entitled Court, located at Courtroom 2, 17th Floor, 450 Golden Gate Ave., San Francisco, California, Plaintiffs will move the Court for an order granting leave to file a second amended complaint in the above captioned matter to add facts to the pleadings and to add a new party, specifically adding allegations of RICO predicate acts that Plaintiff's former counsel had been unaware of in drafting the first amended complaint, and had therefore not plead. MOTION The grounds for this motion for leave to file a second amended complaint are to allege newly discovered and supplemental facts that will significantly expand upon what is alleged in the First Amended Complaint, and that are necessary to apprise Defendants of the facts that form the basis of the allegations in the complaint; equity, fairness and justice dictate this. In addition, Plaintiffs seek to add a new party, and maintain that, since there has been no substantive litigation of the merits of this case as of the date of this motion, there would be no prejudice to the new party.

Continued next page

26 27 28
NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

-2-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 3 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

RELIEF REQUESTED Plaintiffs JOHN GIDDING and PIVOTAL, INC., pursuant to Rule 15(b) of the Federal Rules of Civil Procedure, hereby move the Court for an order granting leave to file the Proposed Second Amended Complaint in the above captioned matter, which, among other things, adds allegations of RICO predicate acts that were inadvertently omitted by Plaintiffs' former attorney, and adds a new party. This motion is based on the legal arguments contained in the Memorandum of Points and Authorities in Support of Plaintiffs Motion for Leave to File a Second Amended Complaint, the declaration of Cory Birnberg, the Proposed Second Amended Complaint attached thereto, and the pleadings and papers on file herein. MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION

NOW COME Plaintiffs JOHN GIDDING (hereinafter "GIDDING") and PIVOTAL, INC. (hereinafter "PIVOTAL") and do hereby move this Court for an order granting leave to file a second amended complaint in this matter. This motion is brought on the grounds that Plaintiff's former counsel, David Cohen, was unaware of additional facts that could have and should have been pled in the Plaintiff's first amended complaint ("FAC"). After reviewing the entire file, Plaintiffs' newly-appointed counsel asserts that the FAC can be modified to be much more descriptive of the conveyance scheme at issue, that is the subject of the RICO causes of action. Because this is an ongoing scheme, new facts and new documents are constantly becoming available that would significantly expand upon what is alleged in the FAC. Further, Plaintiffs assert that it is necessary to amend the FAC to plead these new facts, and to add a new party to the lawsuit, so that Defendants may be fairly apprised of the facts that form the basis of the allegations in the complaint; equity, fairness and justice dictate this. In the event that Defendants' motions to dismiss are denied, Plaintiff requests that the court grant leave to file a second amended complaint. In the unlikely event that Plantagenet
NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

26 27 28

-3-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 4 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

Defendants' motion to dismiss is sustained, Plaintiffs' respectfully request leave to file the second amended complaint, which will incorporate these new facts and the new party. This motion is based on the following legal arguments, the Proposed Second Amended Complaint attached hereto, and the pleadings and papers on file herein.

II.

FACTS

Plaintiffs initially retained David J. Cohen to bring suit in the instant case. Plaintiffs filed suit against the various defendants herein on September 14, 2007. On December 17, 2007, counsel for Plaintiffs filed the FAC, which incorporated RICO causes of action. PLANTAGENET Defendants filed a motion to dismiss on January 31, 2008. Over the week of February 11, 2008, Plaintiffs traveled to France and cooperated with a French criminal investigation seeking to indict the Defendants and their accomplices for money laundering and corruption. During this investigation, Plaintiffs discovered new facts relevant to the causes of actions alleged in the FAC, and which corroborate these causes of action. On February 29, 2008, Defendant CHRISTOPHE RAPENEAU, SA CHAMPS RENIER filed another motion to dismiss. Thereafter, on March 3, 2008, Defendant MarieClaude Simon filed a motion to dismiss. On March 5, 2008, Plaintiffs appointed new counsel, Cory A. Birnberg and Birnberg & Associates. Immediately upon retention, Mr. Birnberg telephoned counsel for Defendant PLANTAGENET, Matthew Franklin Quint, and requested a stipulation continuing the briefing schedule on the motion to dismiss in order to permit Plaintiffs additional time to complete and file an opposition. Mr. Quint denied the request. Upon Plaintiff's motion for administrative relief to reset the briefing schedule, the court on March 6, 2008, ordered the briefing schedule reset and stated that, should Plaintiffs wish to file a second amended complaint, Plaintiffs shall file a properly noticed motion for leave. The Court is now set to hear the motions to dismiss on May 30, 2008, at 9:00 a.m.

26 27 28

NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

-4-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 5 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

After reviewing the first amended complaint and the motions to dismiss, Plaintiffs believe that an amendment to the first amended complaint is in order. The Proposed Second Amended Complaint is attached hereto as Exhibit 1 and is incorporated herein by reference. III. ARGUMENT

A. PLAINTIFFS SEEK LEAVE TO AMEND THE FIRST AMENDED COMPLAINT TO ADD NEW FACTS AND A NEW PARTY. The court may grant leave to amend the pleadings at any stage of the action. There is no time limit for amendment under Federal Rules of Civil Procedure Rule 15. Thus, leave to amend may be sought any time before entry of judgment, subject to certain limitations. The Rules require that leave to amend should be freely given "when justice so requires." FRCP 15 (a)(2); see Lone Star Ladies Invest. Club v. Schlotzsky's Inc. (5th Cir. 2001) 238 F3d 363, 367 [policy favoring leave to amend "a necessary companion to notice pleading and discovery"]. This policy is to be applied with "extreme liberality." Eminence Capital, LLC v. Aspeon, Inc. (9th Cir. 2003) 316 F3d 1048, 1052; Moore v. Baker (11th Cir. 1993) 989 F2d 1129, 1131 ["justifying reasons must be apparent for denial of a motion to amend"]. Here, Plaintiffs seek to file a second amended complaint that alleges new facts that were not contained in the FAC. Plaintiff's former counsel apparently drafted the FAC in a simplistic manner that, while sufficient to state all causes of action, nonetheless failed to allege facts that Plaintiffs deem important to this case. In addition, Plaintiffs' February 2008 cooperation with the French government apprised Plaintiffs of additional facts relating to Defendants' schemes to launder money, to fund the businesses used in the laundering, and to frame Plaintiffs. Specifically, Plaintiffs seek to add supplemental facts to support the predicate acts in the RICO causes of action. It is necessary for Plaintiffs to plead these supplemental facts, so as to give a complete description of the conveyance scheme at issue. Most importantly, Plaintiffs assert that it is necessary to amend the FAC to plead these new facts, so that
NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

26 27 28

-5-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 6 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

Defendants may be fairly apprised of the facts that form the basis of the allegations in the complaint. Fairness to all parties, including to Defendants, dictates that this Court grant Plaintiffs leave to file a second amended complaint. Furthermore, amendments seeking to amend claims are to be granted freely, as well as amendments adding parties in the beginning of litigation of the suit. Union Pac. R.R. Co. v. Nevada Power Co. (9th Cir. 1991) 950 F2d 1429, 1432 (emphasis added); see Becherer v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (6th Cir. 1995) 43 F3d 1054, 1069 [amendment to add party over one year after complaint filed denied as too prejudicial to new party]. Here, Plaintiffs' seek leave to file a second amended complaint that will add new facts to the complaint. Plaintiffs are adding one new party, SCEA Chateau La Lagune, and are doing so before Defendants have even filed an answer in this matter. In contrast to Union Pacific R.R. Co., in which the Ninth Circuit denied a motion to add a new party one year after the complaint was filed for prejudice to the new party, here Plaintiff is adding a new party before any substantive litigation has occurred in this suit. Defendants have yet to answer, no parties have been deposed, and no discovery has been propounded. Plaintiffs simply seek to supplement the facts already pled and add in the new party to further bolster its RICO causes of action, in an effort to provide a complete picture of the conveyance scheme that is the subject of this lawsuit. The existing Defendants would be benefited by this second amended complaint, because they would be further apprised of the underlying basis of Plaintiffs' claims. The new party would not be prejudiced, because there has been no substantive litigation of this case as of the date of this motion (except for the motions to dismiss and the present motion). In fact, the existing Defendants would not be prejudiced in the slightest by this Court granting Plaintiffs leave to file a second amended complaint. The Ninth Circuit has summarily denied motions to amend where the moving party has created undue delay in filing the motion, where the motion was brought in bad faith, and/or were there would be undue prejudice to the opposing party by virtue of allowance of the amendment. In the absence of such apparent circumstances, the leave sought should, as the Rules require, be
NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

26 27 28

-6-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 7 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

"freely given." Eminence Capital, LLC v. Aspeon, Inc. 316 F3d at 1052; See also Hurn v. Ret. Fund Trust of the Plumbing, Heating & Piping Indus. of S. Cal., 648 F.2d 1252, 1254 (9th Cir.1981). Here, Plaintiff's new counsel has acted swiftly to seek leave to amend. The Eleventh Circuit has found that delays may prejudice the opposing party's ability to respond to the proposed amendment or to prepare for trial (e.g., the opposing party may be unable to locate witnesses, or witness recollection may now be unclear, or there may be a loss or destruction of relevant documents). Campbell v. Emory Clinic (11th Cir. 1999) 166 F3d 1157, 1162; see also Solomon v. North American Life & Cas. Ins. Co. (9th Cir. 1998) 151 F3d 1132, 1139 [motion "on the eve of the discovery deadline" properly denied because it would have required reopening discovery, thus delaying proceedings]. There can be no such prejudice by way of a delayed motion to amend here; in fact, the parties have yet to even begin discovery. As litigation is barely underway, and Plaintiff's new counsel has immediately brought this motion (and scheduled it to be heard along with Defendants' various motions to dismiss), there can be no sound argument for prejudice via delay. An amendment to the FAC would be in the interests of all parties, and will assist the Court in gaining a more sophisticated understanding of the conveyance scheme alleged in the complaint. In seeking leave to amend, Plaintiff is motivated by a desire to apprise the Court and Defendants of new facts that form the basis for allegations in the case. In fact, given the supplemental facts, Defendants will be better prepared to defend their actions in this case and to conduct discovery on discrete issues that were previously not alleged. It is therefore necessary to the proper adjudication of this matter for Plaintiff to plead these new facts and to add a new party, in the interests of the Court and of all parties. Lastly, even if the Defendants were able to assert that they are, in some way prejudiced by the filing of a second amended complaint, Defendants would still have to establish that the prejudice to them is substantial. Morongo Band of Mission Indians v. Rose (9th Cir. 1990) 893 F2d 1074, 1079 (showing of substantial prejudice and other relevant factors required). Indeed, prejudice to the opposing party is by far the most
NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

26 27 28

-7-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 8 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

important and most common reason for a Court denying leave to amend: "Prejudice is the touchstone of the inquiry under rule 15(a)." Eminence Capital, LLC v. Aspeon, Inc. (9th Cir. 2003) 316 F3d 1048, 1052 [internal quotes omitted]; Lone Star Ladies Invest. Club v. Schlotzsky's Inc. (5th Cir. 2001) 238 F3d 363, 368;Missouri Housing Develop. Comm'n v. Brice (8th Cir. 1990) 919 F2d 1306, 1316. Absent prejudice, or a strong showing of any of the remaining reasons for denying leave to amend, "there exists a presumption under Rule 15(a) in favor of granting leave to amend." Eminence Capital, LLC v. Aspeon, Inc., supra, 316 F3d at 1052 [emphasis in original]. In addition, any prejudice to the non-movant must be weighed against the prejudice to the moving party by not allowing the amendment. Buder v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (8th Cir.1981) 644 F.2d 690, 694; see also Bell v. Allstate Life Ins. Co. (8th Cir. 1998) 160 F3d 452, 454. Here, should the Court grant Plaintiff's motion for leave to file a second amended complaint, Defendants will not be prejudiced in the slightest, but will gain a distinct advantage, in that they will be apprised of additional facts that form the basis of the allegations in the complaint. There is, therefore a presumption under Rule 15(a) in favor of this Court granting leave to amend. B. IN THE UNLIKELY EVENT THAT DEFENDANTS' MOTIONS TO DISMISS ARE GRANTED, PLAINTIFFS REQUEST LEAVE TO AMEND, AS JUSTICE SO REQUIRES. Leave to amend is usually granted after a Rule 12 motion to dismiss. The court normally grants leave to amend and specifies the time within which the amended pleading is due (e.g., 30 days). As a practical matter, leave to amend is almost always granted by the court. FRCP 15(a) expressly states leave to amend "shall be freely given when justice so requires." FRCP 15(a); Allen v. City of Beverly Hills (9th Cir. 1990) 911 F2d 367, 373; Friedlander v. Nims (11th Cir. 1985) 755 F2d 810, 813]. The Ninth Circuit has held the court should grant leave to amend even if plaintiff did not request leave to amend, unless it is clear that the complaint cannot be cured by the allegation of different facts. Doe v. United States (9th Cir. 1995) 58 F3d 494, 497. It is of no consequence that no request to amend the
NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

26 27 28

-8-

Case No. C-7-04755-JW

Case 3:07-cv-04755-JSW

Document 73

Filed 04/24/2008

Page 9 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BIRNBERG & ASSOCIATES
703 MARKET STREET SUITE 600 SAN FRANCISCO CA, 94103 TEL (415) 398-1040 FAX (415) 398-2001

pleading was made in the district court. Schreiber Distributing v. Serv-Well Furniture Co. (9th Cir. 1986) 806 F.2d 1393, 1401. Here, of course, Plaintiffs are bringing this separate motion to amend, in addition to the Proposed Second Amended Complaint attached as Exhibit 1 to this motion. For the reasons stated above, there is a presumption under Rule 15(a) in favor of this Court granting leave to amend. Lastly, should the Court grant leave to amend as requested in this motion, Defendants' motions to dismiss will be moot, save for the motions to dismiss based on alleged lack of personal jurisdiction.

IV.

CONCLUSION

In the event that Defendants' motions to dismiss are denied, Plaintiff requests that the court grant leave to file a second amended complaint. In the unlikely event that Defendants' motions to dismiss are sustained, Plaintiffs respectfully request leave to file the second amended complaint, which will incorporate newly discovered and supplemental facts, and which will add a new party. BIRNBERG & ASSOCIATES Dated: 24 April 2008 By: _/s/ Cory A. Birnberg___ Cory A. Birnberg Attorneys for Plaintiffs

26 27 28
NOTICE OF MOTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AN ORDER GRANTING LEAVE TO FILE A SECOND AMENDED COMPLAINT

-9-

Case No. C-7-04755-JW