Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_14-cv-00751/USCOURTS-casd-3_14-cv-00751-5/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 15:0001 Antitrust Litigation (Monopolizing Trade)

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

BONA FIDE CONGLOMERATE, INC.,

Plaintiff,

v.

SOURCEAMERICA et al.,

Defendant.

Case No.: 14-cv-0751-GPC-DHB

ORDER:

(1) GRANTING PLAINTIFF’S 

MOTION TO SUPPLEMENT 

COMPLAINT

(2) GRANTING DEFENDANT’S 

MOTION FOR LEAVE TO FILE 

FIRST AMENDED ANSWER AND 

COUNTERCLAIMS

[ECF Nos. 246 & 247]

Plaintiff Bona Fide Conglomerate, Inc. (“Plaintiff” or “Bona Fide”) brings this 

breach of contract action against SourceAmerica (“Defendant” or “SourceAmerica”) 

concerning a July 27, 2012 Settlement Agreement (“Settlement Agreement”) between the 

parties. Presently before the Court are Plaintiff’s motion for leave to file a supplemental 

complaint (Plf.’s Mot., ECF No. 246) and Defendant’s motion for leave to file a First 

Amended Answer (“FAA”) and counterclaims (Def.’s Mot., ECF No. 247). The Parties 

have fully briefed both motions. (ECF Nos. 249-50, 256-57.) The Court finds the motions 

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suitable for disposition without oral argument pursuant to Civil Local Rule 7.1(d)(1). For

the reasons set forth below, the Court GRANTS Plaintiff’s motion for leave to file a 

supplemental complaint and GRANTS Defendant’s motion for leave to file an FAA and 

counterclaims.

FACTUAL BACKGROUND

This action arises out of the AbilityOne Program (“AbilityOne” or “Program”), a 

government procurement system for goods and services from designated non-profits (i.e., 

“Affiliates”) that substantially employ blind or severely disabled persons. (FAC ¶ 2, ECF 

No. 128.) Services provided by Affiliates to the Federal Government include 

custodial/janitorial, grounds maintenance, information technology, and total facilities 

management. (Id. ¶ 50.) Plaintiff is one such Affiliate of the AbilityOne Program. (Id.

¶ 17.) 

The AbilityOne Program has selected SourceAmerica as the Central Non-Profit

Agency (“CNA”) responsible for allocating procurement opportunities for services by the 

severely disabled among its more than 1,200 member Affiliates. (Id. ¶¶ 4, 72.) As the 

CNA, SourceAmerica develops opportunities and selects Affiliates, and then recommends 

to an AbilityOne Commission that the service and Affiliate be added to a Procurement List. 

(Id. ¶¶ 38, 44-45.) Once a service is added to the Procurement List, a federal agency must 

procure that service from the designated Affiliate unless the Affiliate cannot meet the 

agency’s demand. (Id. at ¶ 38.) The AbilityOne Commission ultimately determines which 

services are added to the Procurement List based on the recommendations of 

SourceAmerica. (Id. ¶¶ 44-45.) However, the AbilityOne Commission does not oversee 

SourceAmerica’s allocation.

Plaintiff alleges a history of disputes between Plaintiff and SourceAmerica over the 

allocation of AbilityOne opportunities. Plaintiff alleges filing a post-award bid protest in 

the U.S. Court of Federal Claims in October 2010, challenging the government’s award of 

a General Services Administration (“GSA”) contract to Defendant Opportunity Village 

pursuant to SourceAmerica’s recommendation. (Id. ¶ 86.) Following the voluntary 

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voidance of SourceAmerica’s recommendation and a re-solicitation of the GSA contract 

opportunity, Plaintiff’s post-award bid protest was dismissed as moot. (Id.) Plaintiff then 

commenced a second bid protest in April 2012, challenging the contract award again made 

to Opportunity Village pursuant to SourceAmerica’s recommendation. (Id. ¶ 87.) Plaintiff 

and SourceAmerica reached a settlement memorialized in a July 27, 2012 agreement 

(“Settlement Agreement”) prior to conducting discovery. (Id. ¶ 88.) Under the terms of 

the Settlement Agreement, SourceAmerica agreed to:

use best efforts to provide that Bona Fide is treated objectively, fairly, and 

equitably in its dealings with [SourceAmerica], with specific attention to 

contract allocation . . . [SourceAmerica] will also use best efforts to provide 

that Bona Fide is afforded equal access to services provided by 

[SourceAmerica] including, regulatory assistance; information technology 

support; engineering, financial and technical assistance; legislative and 

workforce development assistance; communications and public expertise; and 

an extensive training program. 

(Id. ¶ 89) (alterations in original). The Settlement Agreement also provided that 

SourceAmerica would “reasonably monitor” Plaintiff’s participation in the AbilityOne 

Program for three years. (Id. ¶ 90.) Plaintiff alleges it has “not been awarded a single new 

contract by SourceAmerica since the Settlement Agreement was signed.” (Id. ¶ 93.) The 

Settlement Agreement also provides that Plaintiff must notify the Office of General 

Counsel at SourceAmerica of every AbilityOne opportunity to which Plaintiff responds. 

(Decl. of Kevin W. Alexander (“Alexander Decl.”) ¶ 13, ECF No. 247-2.) 

PROCEDURAL BACKGROUND

On April 1, 2014, Plaintiff filed the Complaint in this matter alleging antitrust 

violations against various defendants and breach of contract against only Defendant 

SourceAmerica. (ECF. No. 1.) Defendants filed ten separate motions to dismiss Plaintiff’s 

Complaint. (Dkt. Nos. 23, 47, 48, 51, 53, 55, 66, 85, 86, 87.) On August 20, 2014, the 

Court granted in part and denied in part Defendants’ motions to dismiss, leaving only the 

breach of contract claim against SourceAmerica. (ECF No. 123.) 

On September 19, 2014, Plaintiff filed the operative FAC. (ECF. No. 128.) 

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Defendants filed ten separate motions to dismiss the FAC. (ECF. Nos. 138, 140, 141, 143, 

144, 148, 149, 150, 155, 159.) On January 6, 2015, the Court again dismissed Plaintiff’s 

antitrust claims but denied SourceAmerica’s motion to dismiss the breach of contract 

claim. (ECF No. 189.)

On August 21, 2015, Magistrate Judge David H. Bartick issued a Scheduling Order 

which, among other things, provided that any motion to join other parties, to amend the 

pleadings, or to file additional pleadings shall be filed on or before October 30, 2015. (ECF 

No. 245.) On October 30, 2015, Plaintiff filed the instant motion for leave to file a 

supplemental complaint (ECF No. 246) and Defendant filed a motion for leave to file first 

amended answer and counterclaims (ECF No. 247). The parties filed oppositions on 

November 20, 2015 (ECF Nos. 249, 250) and replies on December 4, 2015 (ECF Nos. 256, 

257.) 

STANDARD OF REVIEW

Federal Rule of Civil Procedure 15(a) provides that a party may amend its pleading 

once as a matter of course within (1) 21 days after serving the pleading or (2) 21 days after 

the earlier of service of a responsive pleading or service of a Rule 12(b) motion. Fed. R. 

Civ. Pro. 15(a). Otherwise, “a party may amend its pleading only with the opposing party's 

written consent or the court's leave,” though the court “should freely give leave when 

justice so requires.” Id. “Five factors are taken into account to assess the propriety of a 

motion for leave to amend: bad faith, undue delay, prejudice to the opposing party, futility 

of amendment, and whether the [party] has previously amended [a pleading].” Johnson v. 

Buckley, 356 F.3d 1067, 1077 (9th Cir. 2004) (citing Nunes v. Ashcroft, 348 F.3d 815, 818 

(9th Cir. 2003)). In practice, however, courts more freely grant plaintiffs leave to amend 

pleadings in order to add claims than new parties. Union Pacific R.R. Co. v. Nevada Power 

Co., 950 F.2d 1429, 1432 (9th Cir. 1991). These factors do not “merit equal weight,” and 

“it is the consideration of prejudice to the opposing party that carries the greatest weight.”

Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). “Absent 

prejudice, or a strong showing of any of the remaining [ ] factors, there exists a presumption

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under Rule 15(a) in favor of granting leave to amend.” Id. (original emphasis).

Federal Rule of Civil Procedure 15(d) provides, “On motion and reasonable notice, 

the court may, on just terms, permit a party to serve a supplemental pleading setting out 

any transaction, occurrence, or event that happened after the date of the pleading to be 

supplemented.” Fed. R. Civ. Pro. 15(d). “The purpose of Rule 15(d) is to promote as 

complete an adjudication of the dispute between the parties as is possible.” LaSalvia v. 

United Dairymen of Ariz., 804 F.2d 1113, 1119 (9th Cir. 1986) (citation and brackets 

omitted). “The standards for granting a motion for leave to file a supplemental pleading 

are the same as those for granting a motion to file an amended complaint under Rule 15(a).” 

Frederick v. Calif. Dep't of Corr. & Rehab., No. 08–cv-2222–MMC, 2012 WL 2077305, 

at *2 (N.D. Cal. June 8, 2012) (citation omitted). “The court should also consider whether 

permitting the supplemental pleading will serve to promote judicial efficiency.” Id.

DISCUSSION

I. Plaintiff’s Motion to File First Supplemental Complaint

Plaintiff seeks leave to file a supplemental complaint to allege facts that occurred 

after the filing of the initial complaint (Compl., ECF No. 1) that it states provide further 

bases of liability and damages as to Plaintiff’s breach of contract related to the performance 

of the Settlement Agreement. Specifically, Plaintiff states that since the commencement 

of this action Plaintiff has competed for several contracts as an Affiliate in the AbilityOne 

Program. (Mot. Supp. Compl. at 2, ECF No. 246.) Plaintiff alleges that of the contracts 

Plaintiff competed for, Defendant awarded five to Affiliates—CW Resources, Professional 

Contract Services, Inc. and Goodwill—that Jean Robinson (“Robinson”), Defendant’s 

former General Counsel, has stated “receive contracts unfairly and automatically, 

regardless of merit.” (Id.) 

Defendant argues that Plaintiff’s motion is untimely, unduly prejudicial because it 

is “nothing short of a ‘moving target’ and subject to continual expansion as Plaintiff 

continues to apply for AbilityOne contracts and . . . alleges unfair treatment anytime it is 

not awarded one.” (Opp’n Supp. Compl. at 1, ECF No. 249.) Defendant also argues that 

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Plaintiff’s proposed supplemental complaint is futile because “it contains no additional 

substantive allegations” and the allegations are “vague and conclusory.” (Id.) 

After review of the motion for leave to file a supplemental complaint and all related 

filings, the Court concludes that, under the Foman test, Defendant has failed to overcome 

the presumption under Rule 15(a) in favor of granting leave to amend. See Eminence 

Capital, 316 F.3d at 1052. Plaintiff’s motion is not untimely as the parties agreed at the 

August 20, 2015 Rule 26(f) conference to the October 30, 2015 deadline to make motions 

to amend pleadings, as reflected in the Court’s Scheduling Order. (See Scheduling Order, 

ECF No. 245.) In fact, in compliance with that deadline, Plaintiff filed its motion to 

supplement complaint and Defendant filed its motion for leave to file an amended answer 

and counterclaims on October 30, 2015. 

Nor is there any showing of wrongful motive in supplementing the FAC as the events 

Plaintiff seeks to allege are related to the same transaction that forms the basis of Plaintiff’s 

breach of contract claim—the Settlement Agreement. The Court does not find that there 

would be undue prejudice to Defendant in allowing the supplemental complaint. As 

Defendant states, the case is its “very early stages” and discovery has just begin. (Def.’s 

Mot. at 12, ECF No. 247.) The deadline for filing pretrial dispositive motions is July 15, 

2016. (Scheduling Order at 3, ECF No. 245.) Accordingly, no prejudice has been shown. 

As to the futility factor, Defendant has not shown that Plaintiff’s supplemental 

pleading would “clearly be subject to dismissal.” DCD Programs, Ltd. v. Leighton, 833 

F.2d 183, 188 (9th Cir. 1987.) Plaintiff’s proposed supplemental complaint alleges 

additional AbilityOne opportunities were denied in breach of the Settlement Agreement. 

At this point of the proceedings, it is not the Court’s role to determine the validity of these 

claims. The Court cannot conclude that Plaintiff’s supplemental complaint is futile. 

As to the last factor, Plaintiff has not previously sought leave to supplement the 

complaint. Based on the five factors that support granting leave to file a supplemental 

complaint, and in light of the Ninth Circuit’s extremely liberal policy favoring leave to 

amend and supplement a complaint, the Court GRANTS Plaintiff’s motion.

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II. Defendant’s Motion for Leave to Amend Answer and File Counterclaims

Defendant seeks leave to amend its answer to add additional affirmative defenses 

and to assert new counterclaims against Plaintiff and third-party Counter-defendant Ruben 

Lopez (“Lopez”), President and CEO of Bona Fide. Specifically, with respect to the 

Answer, Defendant seeks to (1) clarify its response regarding the evaluation process for 

awarding contracts, (2) break up Defendant’s current affirmative defenses of waiver, 

estoppel and/or laches into separate sections, and (3) add the affirmative defenses of 

frustration of purpose, prevention of performance and unclean hands. (Def.’s Mot. at 6-7, 

ECF No 247.) 

In addition, Defendant requests leave to file counterclaims for (1) violation of 

California Penal Code Section 632(a) (“California Invasion of Privacy Act” or “CIPA”); 

(2) unfair, unlawful and/or fraudulent business practices in violation of California Business 

and Professions Code Section 17200; and (3) breach of contract. (Id. at 7.) Defendant 

contends that its proposed counterclaims are based on newly discovered facts, which 

include Plaintiff and Lopez secretly recording conversations between Lopez and Robinson;

Plaintiff failing to notify Defendant of every AbilityOne opportunity to which Plaintiff 

responded in violation of the Settlement Agreement; and Counter-defendants having

additional privileged and confidential information that belongs to Defendant that was not 

previously disclosed. (Id. at 1, 7.) Defendant also argues that its proposed counterclaims 

are further based on Counter-defendants’ “history of wrongful misconduct in an attempt to 

obtain AbilityOne Program opportunities for Bona Fide to which it is neither suitable nor 

entitled.” (Id. at 8.) Plaintiff does not oppose Defendant’s motion to amend the Answer 

but opposes Defendant’s motion to add counterclaims on futility grounds. 

A. Bad Faith, Undue Delay, Prejudice

There can be bad faith in bringing an amendment if the party seeks to prolong 

meritless litigation by adding baseless amendments to their complaint or if there is any 

evidence of wrongful motive. Jones v. Bates, 127 F.3d 839, 847 n. 8 (9th Cir. 1997); 

Griggs v. Pace American Group, Inc., 170 F.3d 877, 881 (9th Cir. 1999); DCD Programs. 

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Ltd., 833 F.2d at 187. Here Plaintiff does not argue nor is there any indication of wrongful 

motive in bringing the counterclaims. 

As to undue delay, the Court looks at whether the moving party unduly delayed in 

filing their motion. Jackson v. Bank of Hawaii, 902 F.2d 1385, 1388 (9th Cir. 1990). In 

making such a determination, the court looks at “whether the moving knew or should have 

known the facts and theories raised by the amendment in the original pleading.” Id. 

According to Defendant, the facts underlying its counterclaims were not learned until 

recently. The Court finds that assertion is only partially supported by the record. However, 

as discussed supra, the parties agreed to an October 30, 2015 deadline to file motions to 

amend pleadings and add parties (see Scheduling Order, ECF No. 245) and discovery has 

just begun. Consequently, there is an insufficient showing of undue delay. 

More importantly, there is no showing of prejudice, as the case is in the early stages. 

Defendant is in compliance with the Scheduling Order and although Lopez was not 

previously named as a party, as the President and CEO of Bona Fide, he has been on notice 

of the litigation. 

B. Futility of Amendment

Defendant argues that amendment is not futile because it alleges legitimate, 

colorable claims. (Def.’s Mot. at 13-14, ECF No. 247.) Plaintiff argues that amendment

to add counterclaims would be futile because Defendant lacks standing and is otherwise 

precluded from bringing two of its three counterclaims and Defendant’s third counterclaim 

alleges damages that do not and cannot exist. (Plf.’s Opp’n at 11, ECF No. 250.) 

“[A] proposed amendment is futile only if no set of facts can be proved under the 

amendment to the pleadings that would constitute a valid and sufficient claim or defense.” 

Miller v. Rykoff-Sexton, Inc., 845 F.2d 209, 214 (9th Cir. 1988). Courts ordinarily do not 

consider the validity of a proposed amended pleading in deciding whether to grant leave to 

amend and defer consideration of challenges to the merits of a proposed amendment until 

after leave to amend is granted and the amended pleadings are filed. Netbula, LLC v. 

Distinct Corp., 212 F.R.D. 534, 539 (N.D. Cal. 2003) (citation omitted); accord Green 

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Valley Corp. v. Caldo Oil Co., No. 09cv4028-LHK, 2011 WL 1465883, at *6 (N.D. Cal. 

April 18, 2011) (noting “the general preference against denying a motion for leave to 

amend based on futility”). Arguments concerning the sufficiency of the proposed 

pleadings, even if meritorious, are better left for briefing on a motion to dismiss. Lillis v. 

Apria Healthcare, No. 12-cv-0052-IEG-KSC-, 2012 WL 4760908, at * 1 (S.D. Cal. Oct. 

5, 2012). 

1) Defendant’s CIPA Claim

Defendant’s first counterclaim alleges that Plaintiff has violated CIPA through 

Lopez’ surreptitious recording of his conversations with Robinson and David Dubinsky 

(“Dubinsky”), a Regional Director for Source America. (Countercl. ¶¶ 67-70, ECF No. 

257-2.) Defendant alleges that Plaintiff provided these illegal recordings to third parties 

and that these recordings eventually ended up on WikiLeaks. (Id. ¶¶ 72-73.) 

Plaintiff opposes Defendant’s CIPA counterclaim on the basis of futility because (1) 

Defendant lacks standing because CIPA does not apply extraterritorially and (2) Defendant 

has “disavowed” Robinson as its agent. (Plf.’s Opp’n at 11-13, ECF No. 250.) Plaintiff 

argues that Defendant lacks standing because it neither holds its principal place of business 

nor is incorporated in California and Defendant does not allege that any of the recordings 

at issue were made while Robinson was within California’s boundaries. (Id. at 12.) 

Plaintiff contends that because CIPA expressly provides that it was “not intended to have 

extraterritorial operation,” Defendant’s CIPA counterclaim must fail. Plaintiff further 

argues that Defendant lacks standing because Defendant alleges that Robinson made all 

the recorded disclosures to Lopez “[u]nbeknownst to SourceAmerica and without 

authorization.” (Id. (citing Countercl. ¶ 12, ECF No. 29, ECF No. 257-2.) 

Defendant responds that at least one party to the unlawfully recorded 

conversations—Lopez—was located in California, and, in any event, Defendant has offices 

in California and Dubinsky is a California resident. Defendant further argues that it has 

standing because the statute creates a private right of action for “[a]ny person who has been 

injured by a violation of this section” and is not limited to the party that was illegally 

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recorded (Def.’s Reply at 4, ECF No. 257 (citing Cal. Penal Code § 637.2).) Accordingly, 

it is irrelevant whether Robinson was acting within the scope of her employment. (Id.) 

CIPA, California's anti-wiretapping and anti-eavesdropping statute, prohibits 

unauthorized interceptions of communications in order “to protect the right of privacy.” 

Cal. Penal Code § 630. The California Legislature enacted CIPA in 1967 in response to 

“advances in science and technology [that] have led to the development of new devices 

and techniques for the purpose of eavesdropping upon private communications.” Id. 

Section 632 prohibits unauthorized electronic eavesdropping on confidential 

conversations. See Cal. Penal Code § 632(a). To state a claim under section 632, a plaintiff 

must allege an electronic recording of or eavesdropping on a confidential communication, 

and that not all parties consented to the eavesdropping. Flanagan v. Flanagan, 41 P.3d 

575, 577 (Cal. 2002).

Here, both parties raise numerous factual and legal issues supported by declarations 

regarding the applicability of CIPA to the recorded conversations that are in dispute. At 

this point of the proceedings, it is not the Court’s role to determine the legal or factual 

merits of the claim. The Court cannot conclude that Defendant has failed to sufficiently 

plead a plausible claim for relief under CIPA. 

2) Defendant’s UCL Claim

Defendant alleges that Bona Fide and Lopez violated California Business and 

Professions Code Section 17200 (“UCL”) by engaging in various misconduct in an attempt 

to force Defendant to recommend Bona Fide for AbilityOne opportunities to which it was 

not entitled. Defendant alleges that Lopez committed various “unlawful, unfair, or 

fraudulent conduct” in his capacity of as President of Bona Fide and, as a result, these 

wrongful acts caused SourceAmerica substantial injury, including reputational harm, 

damages, and litigation and other legal costs. (Countercl. ¶¶ 79-81, ECF No. 257-2.) 

Plaintiff argues that Defendant lacks statutory standing to bring a UCL claim based 

upon out-of-state conduct because Defendant is an out-of-state claimant and of the 

“wrongful” conduct alleged by SourceAmerica, the only conduct that occurred in 

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California is the instant lawsuit. (Plf.’s Mot. at 14, ECF No. 250.) Defendant responds 

that the alleged wrongful conduct occurred largely in California, Defendant maintains an 

office and conducts business in California, and certain opportunities to which Bona Fide 

claims to have been entitled were in California. (Def.’s Reply at 5-6. ECF No. 257.) 

Plaintiff also argues that Defendant’s UCL claim based on Plaintiff’s 

commencement of this and other lawsuits or promoting government investigations is 

privileged under Cal. Civ. Code § 47(b), Defendant has not alleged that it “suffered injury 

in fact . . . and lost money or property” as required by Cal. Bus. & Prof. Code § 17204 

because litigation expenses do not qualify for UCL purposes, and Defendant has released 

all claims against Plaintiff for pre-July 27, 2012 conduct under the Settlement Agreement. 

Defendant responds that it has sufficiently alleged injury, the litigation privilege does not 

apply to Defendant’s UCL claim because it does not bar recovery for injuries for tortious 

conduct, and the litigation privilege is inapplicable to illegal recordings by Plaintiff. 

(Def.’s Opp’n at 7-8, ECF No. 257.) Defendant contends that its UCL claim is not barred 

by the Settlement Agreement because “many of the allegations, including the illegal 

recordings, occurred well after this date.” (Id. at 9.) 

At this stage, the Court cannot conclude that no set of facts can be proved on the 

allegations in the counterclaim. In its proposed claim under the UCL, Plaintiff specifically 

identifies the conduct that allegedly violates the UCL. The parties dispute where the 

alleged wrongful acts occurred and whether Defendant is an out-of-state claimant. Even if 

the Court finds that some of Plaintiff’s conduct is privileged, it is unclear at this juncture 

that the privileged conduct extends to allegedly illegal recordings by Plaintiff. Defendant 

alleges that at least some of the allegedly illegal recordings occurred after July 27, 2012. 

Defendant also alleges injury beyond litigation expenses, including harm to its reputation. 

The Court therefore concludes that granting Defendant leave to file a counterclaim would 

not be futile.

//

//

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3) Defendant’s Breach of Contract Claim

In its third counterclaim Defendant alleges that Bona Fide “breached the Settlement 

Agreement by failing to notify SourceAmerica of every opportunity for which it submitted 

a response.” (Countercl. ¶ 88, ECF No. 257-2.)

Plaintiff argues that amendment would be futile because SourceAmerica “cannot 

possibly have been damaged by Bona Fide’s alleged breach of its duty to report its 

submission of responses.” (Plf.’s Opp’n at 18, ECF No. 250.) Plaintiff contends that there 

is no connection between its reporting of a response to an opportunity and “any source of 

potential revenue or loss for Source America.” (Id.) Defendant responds that Plaintiff’s 

breach of the Settlement Agreement has injured Defendant because “Bona Fide’s failure 

to report has caused SourceAmerica additional litigation expenses, and is a contributing 

factor in the ongoing dispute brought by Bona Fide against SourceAmerica alleging that 

Source America breached the Settlement Agreement.” (Def.’s Reply at 10, ECF No. 257.) 

Defendant alleges that it has been damaged as a direct and proximate result of the 

breach. (Countercl. ¶ 89.) At this time, Plaintiff has not demonstrated that Defendant 

cannot prove damages resulting from Bona Fide’s alleged breach and that granting 

Defendant leave to file a counterclaim is futile. 

As to the last factor, Defendant has not previously sought leave to file a 

counterclaim. Based on the five factors that support the filing of counterclaims, and in 

light of the Ninth Circuit’s extremely liberal policy favoring leave to amend, the Court 

GRANTS Defendant’s motion for leave to file counterclaims. Because the 

Court did not rely on the documents in Plaintiff’s request for judicial notice, the Court 

denies the request for judicial notice.

//

//

//

//

//

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CONCLUSION

For the foregoing reasons, the Court hereby:

(1) GRANTS Plaintiff’s motion for leave to file a supplemental complaint; and

(2) GRANTS Defendant’s motion for leave to file an amended answer and 

counterclaims.

IT IS SO ORDERED. 

Dated: January 5, 2016

Case 3:14-cv-00751-GPC-AGS Document 266 Filed 01/05/16 PageID.<pageID> Page 13 of

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