Opinion ID: 4703137
Heading Depth: 3
Heading Rank: 3

Heading: Denial of Leave to Amend the FAC

Text: We next address whether the district court properly denied leave to amend. While we have concluded that the Case: 20-2218 Document: 44 Page: 21 Filed: 07/13/2021 BOT M8 LLC v. SONY CORPORATION OF AMERICA 21 FAC was sufficient as to the ’988 and ’670 patents, we conclude that leave to amend was properly denied as to all four patents. After the district court dismissed the FAC as to the ’540, ’990, ’988, and ’670 patents, Bot M8 sought leave to file another amended complaint and submitted a proposed SAC. Bot M8 maintained that amendment was necessary because the DMCA and other anti-hacking statutes restrained its earlier reverse engineering efforts. The district court denied the motion. In doing so, the court explained that, where the court has imposed a deadline, Rule 16(b)(4) permits modification “only for good cause,” and the central inquiry is “whether the requesting party was diligent in seeking the amendment.” Order Den. Mot. to Amend, 2020 WL 1643692, at . Because Bot M8 did not raise any concerns about its ability to reverse engineer the PS4 until after the district court issued its decision on Sony’s motion to dismiss, the court found that Bot M8 was not diligent. Id. In denying leave to amend, the district court found no authority to support Bot M8’s belated “fear of the DMCA or other anti-hacking statutes” and no explanation for why Bot M8 failed to raise its concerns at the November 21 case management conference where it represented to the court that it had already “torn down the Sony PlayStation.” Id. at . Because it believed the proposed amendments should have been included in Bot M8’s FAC, the court found them untimely. The court subsequently denied Bot M8’s request for reconsideration, noting that it had “directed reverse engineering of the Sony PlayStation 4 at the November 21, 2019, case management conference.” Order Den. Leave to Move for Recons., 2020 WL 1904102, at . On appeal, Bot M8 submits that the district court abused its discretion in denying leave to amend. Bot M8 maintains that it “sought leave to amend in view of new evidence uncovered after obtaining permission to jailbreak the PS4 and then deciphering its software.” Appellant’s Br. Case: 20-2218 Document: 44 Page: 22 Filed: 07/13/2021 22 BOT M8 LLC v. SONY CORPORATION OF AMERICA 47. According to Bot M8, the district court should have reviewed the motion using Rule 15(a)’s liberal amendment policy—not the “good cause” standard of Rule 16—because the court’s order on the motion to dismiss gave until February 13, 2020 to seek leave to amend and Bot M8 complied with that deadline. Bot M8 also argues that, because it filed the motion for leave to amend less than three weeks after the court dismissed the FAC, and “within two weeks of obtaining permission to jailbreak the PS4,” the court abused its discretion in denying the motion. Id. at 49. We apply regional circuit law to district court “procedural decisions that relate to issues not unique to our exclusive jurisdiction, including motions for leave to amend.” Ultimax Cement Mfg. Corp. v. CTS Cement Mfg. Corp., 587 F.3d 1339, 1354 (Fed. Cir. 2009). Under Ninth Circuit law, a district court’s denial of leave to amend a pleading after the deadline has passed is reviewed for an abuse of discretion. Id. Where, as here, a party seeks leave to amend after the deadline set in the scheduling order has passed, Federal Rule of Civil Procedure 16 applies to motions to amend the pleadings. Id. 4 Rule 16 provides that “[a] schedule may be modified only for good cause and with the judge’s consent.” Fed. R. Civ. P. 16(b)(4). While the district court perhaps should not have required reverse engineering of Sony’s products as a prerequisite to pleading claims of infringement (a question we would consider on a case-by-case basis), Bot M8 waived its objection to that obligation when it told the court it was happy to undertake that exercise. The court requested reverse engineering at the November 2019 case management 4 After the district court’s November 21, 2019 case management conference, the court issued a case management order setting December 5, 2019 as the deadline for amendment. Bot M8 did not file its motion for leave to amend until February 13, 2020. Case: 20-2218 Document: 44 Page: 23 Filed: 07/13/2021 BOT M8 LLC v. SONY CORPORATION OF AMERICA 23 conference—two weeks before Bot M8 filed its FAC in December 2019 and twelve weeks before Bot M8 moved for leave to amend in February 2020. At that November conference, Bot M8 did not object to reverse engineering, did not suggest that compliance would be difficult, and did not argue that it needed permission. Instead, Bot M8 represented that it had already “torn down” the PS4 and would be “happy to” put its results into claim charts. We, thus, are not reviewing the court’s original reverse engineering order at this stage, but may only review the court’s later conclusion that Bot M8 was not diligent in raising its concerns with the reverse engineering order until its request to file the SAC. That ruling presents us with a close question. Were we reviewing that order under Rule 15’s standards, we might well find that the district court abused its discretion in denying leave to amend. And, were we in the district court’s role and considering the request in the first instance, we likely would have allowed the filing of the SAC. But we are faced with neither of those circumstances. Reviewing the district court order on appeal and under Rule 16, we cannot conclude that the district court abused its discretion. Even if we might have reached a different decision if asked to consider the matter in the first instance, we do not find that the district court abused its discretion in denying leave to amend a second time. See United States v. Ferguson, 246 F.3d 129, 133 (2d Cir. 2001) (“[W]e are mindful that a judge has not abused h[is] discretion simply because [he] has made a different decision than we would have made in the first instance.”). We therefore affirm the district court’s denial of Bot M8’s motion to amend its complaint, and its order denying reconsideration of that decision.