Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_04-cv-01971/USCOURTS-caed-2_04-cv-01971-14/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 15:1126 Patent Infringement

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

WORDTECH SYSTEMS, INC., NO. 2:04-cv-01971-MCE PAN

a California corporation,

Plaintiff,

v. ORDER

INTEGRATED NETWORK SOLUTIONS,

INC., a Nevada corporation,

dba INTEGRATED NETWORK

SOLUTIONS, CORP. aka

INTEGRATED NETWORK SOLUTIONS

aka INTEGRATED SYSTEMS aka

INTEGRATED NETWORK STORAGE

COMPANY aka INSC; NASSER

KHATEMI, an individual; HAMID

ASSADIAN, an individual;

EHTERAM GHODSIAN, an

individual; SHOHREH JAVADI, an

individual; MICHAEL F.

ELLSWORTH, an individual;

BRIAN J. DEAN, an individual;

SAN JUAN UNIFIED SCHOOL

DISTRICT; and DOES 1-50,

Defendants.

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Case 2:04-cv-01971-TLN-EFB Document 226 Filed 09/03/08 Page 1 of 6
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Plaintiff Wordtech Systems, Inc. (“Wordtech”) has filed a

Motion to Modify the Pretrial Scheduling Order. Plaintiff seeks

leave to file dispositive motions, including a motion to strike

the answers of certain defendants and to enter default against

those defendants, over a year after the deadline set by the

Pretrial Scheduling Order. 

STANDARD

Generally, the Court is required to enter a pretrial

scheduling order within 120 days of the filing of the complaint. 

Fed. R. Civ. P. 16(b). The scheduling order “controls the

subsequent course of the action” unless modified by the Court. 

Fed. R. Civ. P. 16(e). Orders entered before the final pretrial

conference may be modified upon a showing of “good cause,” Fed.

R. Civ. P. 16(b), but orders “following a final pretrial

conference shall be modified only to prevent manifest injustice.” 

Fed. R. Civ. P. 16(e); see also Johnson v. Mammoth Recreations,

975 F.2d 604, 608 (9th Cir. 1992).

Rule 16(b)’s “good cause” standard primarily considers the

diligence of the party seeking the amendment. Johnson v. Mammoth

Recreations, 975 F.2d 604, 609 (9th Cir. 1992). The district

court may modify the pretrial schedule “if it cannot reasonably

be met despite the diligence of the party seeking the extension.”

Fed. R. Civ. P. 16 advisory committee's notes (1983 amendment);

Id. Moreover, carelessness is not compatible with a finding of

diligence and offers no reason for a grant of relief. Id.

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Although the existence or degree of prejudice to the party

opposing the modification might supply additional reasons to deny

a motion, the focus of the inquiry is upon the moving party’s

reasons for seeking modification. If that party was not

diligent, the inquiry should end. Id. 

“In evaluating a motion to amend the pretrial order, a

district court should consider four factors: (1) the degree of

prejudice or surprise to the [non-moving party] if the order is

modified; (2) the ability of the [non-moving party] to cure the

prejudice; (3) any impact of modification on the orderly and

efficient conduct of the trial; and (4) any willfulness or bad

faith by the party seeking modification.” Galdamez v. Potter,

415 F.3d 1015, 1020 (9th Cir. 2005) (citing Byrd v. Guess, 137

F.3d 1126, 1132 (9th Cir. 1998)).

ANALYSIS

The Ninth Circuit has addressed Rule 16(b)’s “good cause”

standard and held that this standard primarily considers the

diligence of the party seeking the amendment. The district court

may modify the pretrial schedule “if it cannot reasonably be met

despite the diligence of the party seeking the extension.”

Johnson, 975 F.2d at 609 (9th Cir. 1992) (citing Forstmann, 114

F.R.D. 83, 85 (1987); 6A Wright, Miller & Kane, Federal Practice

and Procedure § 1522.1 at 231 (2d ed. 1990) (“good cause” means

scheduling deadlines cannot be met despite party’s diligence)). 

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In Johnson, the Ninth Circuit did not permit the plaintiff to

amend the Pretrial Scheduling Order to include an additional

defendant because the plaintiff had not met the pretrial deadline

for adding such a party. 975 F.2d 604. Furthermore, the Johnson

court found that the plaintiff could not meet the “good cause”

standard of Rule 16 because it was aware of the identity of the

proper defendant prior to the deadline but nonetheless failed to

timely add that party. Id.

This Court entered its Third Amended Pretrial Scheduling

Order on September 12, 2006. That Order provided that all

dispositive motions were to be heard no later than April 23,

2007. Plaintiff brought this motion for leave to file a motion

to strike the answers of certain defendants and for leave to

enter default judgment against those same defendants on May 23,

2008 - more than a year after the date set by the Pretrial

Scheduling Order. The crux of Plaintiff’s argument is that

Defendants provided corporate records of Integrated Networks

Solutions, Inc., instead of Integrated Network Solutions, Corp.,

in order to distance the individual defendants from the corporate

defendants and thereby avoid alter ego liability. Although this

is a serious accusation, Plaintiff simply waited far too long to

bring this matter to the Court’s attention. The documents were

produced in advance of both the discovery cut-off and the

dispositive motion deadline. The parties have known, from nearly

the inception of this case, that there was some confusion as to

the exact name of the corporate defendant. Indeed, Plaintiff’s

original complaint named both of the above corporations in the

caption. 

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Aware of this confusion, Plaintiff was in a position to realize

this discrepancy prior to the deadlines in the Pretrial

Scheduling Order and failed to do so.

Further, the records that Plaintiff argues indicate that the

individual defendants were concealing their corporate status date

to 1994 and 1995, more than 10 years prior to any misconduct

alleged in Plaintiff’s Complaint. Accordingly, the documents are

largely irrelevant to the issues Plaintiff is arguing. To the

extent they evidence that a witness was lying, that matter is

better dealt with on cross-examination, not on a motion for

ultimate sanctions.

The Court has reviewed the remainder of Plaintiff’s

arguments and finds they do not meet the good cause requirement

under Rule 16(b). These arguments could have been resolved via

further discovery or may be dealt with at the time of trial, but

do not warrant allowing Plaintiff to file dispositive motions to

strike Defendants’ Answers nor to seek entry of default

judgments. Allowing the filing of such motions would severely

prejudice Defendants who have litigated this case for over four

years now.

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CONCLUSION

Because this Court finds that good cause does not exist to

allow Plaintiff to file dispositive motions more than a year

after the deadline set by the Pretrial Scheduling Order,

Plaintiff’s Motion to Modify the Pretrial Scheduling Order is

DENIED.

IT IS SO ORDERED.

Dated: September 2, 2008

_____________________________

MORRISON C. ENGLAND, JR.

UNITED STATES DISTRICT JUDGE

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