Opinion ID: 746462
Heading Depth: 2
Heading Rank: 3

Heading: Motion for Leave to File a Third Amended Complaint

Text: 45 Orix next claims that the district court erred in refusing to permit it to amend its complaint. At the close of the evidence, Orix sought to amend its complaint to conform to the proof at trial by adding an additional count against Metts for fraud and a count against both Taylor and Metts for a scheme to defraud. The court denied Orix's motion for leave to amend its complaint, stating that no new facts have surfaced in regard to Metts and therefore Orix had no reason for waiting so long to amend its complaint. More importantly, however, the court denied the motion because the new counts could have prejudiced Metts because they added the possibility of punitive damages, a consequence that Metts might have sought to protect himself against had the claims been raised earlier. 46 The Federal Rules of Civil Procedure provide that courts should freely permit parties to amend their complaints, even after judgment, where there is no harm to the defendant. See U.S. v. Security Pacific Business Credit, Inc., 956 F.2d 703, 707-08 (7th Cir.1992); see also Fed.R.Civ.P. 15(a), (b). We have further provided that courts should generally allow such amendments unless there is undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, [or] futility of amendment. Ferguson v. Roberts, 11 F.3d 696, 706 (7th Cir.1993) (quoting Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230, 9 L.Ed.2d 222 (1962)). Generally, the decision whether to grant a party leave to amend the pleadings is a matter left within the discretion of the district court, Sanders v. Venture Stores, Inc., 56 F.3d 771, 773 (7th Cir.1995), and therefore we will reverse that decision only if the district court abused its discretion, Bisciglia v. Kenosha Unified Sch. Dist. No. 1, 45 F.3d 223, 226 (7th Cir.1995). 47 We believe that the district court did not abuse its discretion in denying Orix's motion for leave to amend. In its brief, Orix provides some valid reasons explaining its four-year delay in amending its complaint. For example, Metts did not answer the original complaint until the day of the trial and the court did not rule on Metts's prior motion to dismiss (based on the fiduciary shield doctrine) until January 9, 1996--a little more than five months before the trial. Orix's argument falters, however, because it asserts that the new counts could not have surprised Metts because the third amended complaint did not add any new facts or parties. In this assertion, Orix makes Metts's argumentbecause there were no new facts, there is no reason why Orix could not have amended the complaint at an earlier date. 48 Moreover, the new counts do add an element of surprise--they add the prospect of punitive damages for Metts. Metts persuasively points out that had he known of the fraud claim prior to trial, he may have taken different measures--such as retaining counsel independent from Taylor--to protect himself from the additional liability. The potential prejudice to Metts, coupled with Orix's undue delay in seeking to amend its complaint, provided the district court with adequate grounds to deny Orix's motion for leave to amend. We therefore find that the court did not abuse its discretion in doing so.