United States District Court, D. South Dakota, Western Division
ORDER GRANTING PLAINTIFF'S MOTION TO AMEND (DOC.
18) AND DENYING DEFENDANT'S MOTION TO DROP OR SUBSTITUTE
PARTY (DOC. 20)
DANETA
WOLLMANN United States Magistrate Judge
This is
an action seeking declaratory relief which arose out of a
motor vehicle accident. Plaintiff Subrogation Division, Inc.
filed a Motion to Amend (Doc. 18), requesting leave to file a
Second Amended Complaint adding a second defendant. Defendant
Stanley Brown filed a Motion to Drop or Substitute Party
(Doc. 20), requesting that he be dropped as a party to the
lawsuit. United States District Court Judge Jeffrey L. Viken,
Chief Judge, referred Dockets 18 and 20 to this magistrate
judge for determination. (Doc. 27).
FACTUAL
BACKGROUND
Plaintiff's
Amended Complaint alleges the following facts. (Doc. 5). In
May 2013, Defendant Stanley Brown rented a vehicle from Hertz
in Rapid City, South Dakota. Brown entered into a rental
agreement in which he chose not to purchase Hertz's
liability insurance supplement; Brown was separately insured
through 21st Century North America Insurance Company
(“21st Century”).
During
the term of his rental, Brown was involved in a motor vehicle
accident in Rapid City with a third party, Dan Claymore. 21st
Century reimbursed Hertz for property damage to the rental
car. Hertz's insurance carrier reimbursed Claymore for
property damage to his personal vehicle. Plaintiff
Subrogation Division, Inc. (“SDI”), as
Hertz's assignee, sought recovery from Brown for
reimbursement of the amount paid to Claymore. Brown did not
reimburse SDI, leading to this lawsuit.
DISCUSSION
SDI
seeks to file a Second Amended Complaint, which adds 21st
Century as a defendant and asks the Court to determine that
21st Century is the primary insurer in this dispute. (Doc.
18). Brown requests that he be dropped from the lawsuit or,
in the alternative, that 21st Century replace him as the
defendant in this case. (Doc. 20).
I.
SDI's Motion to Amend
Federal
Rule of Civil Procedure 15 requires that “leave to
amend a complaint ‘shall be freely given when justice
so requires, ' but the granting of such a motion is left
to the discretion of the district court.” Kaufmann
v. Sheehan, 707 F.2d 355, 357 (8th Cir. 1983) (quoting
Fed.R.Civ.P. 15(a)). “[A]bsent a good reason for
denial-undue delay, bad faith or dilatory motive, repeated
failure to cure deficiencies by amendments previously
allowed, undue prejudice to the non-moving party, or futility
of amendment-leave to amend should be granted.”
Thompson-El v. Jones, 876 F.2d 66, 67 (8th Cir.
1989). for amended pleadings under FRCP 16(b), ” and
the motion to amend is filed past that deadline. Kozlov
v. Assoc. Wholesale Grocers, Inc., 818 F.3d 380, 395
(8th Cir. 2016) (internal quotations omitted).
Rule
15's liberal policy favoring amendments applies here. The
Court's scheduling order allowed the parties until July
31, 2017, to move to join additional parties and to amend the
pleadings. (Doc. 15). SDI filed its Motion to Amend on June
30, 2017. The parties subsequently filed a Joint Motion to
Extend Deadlines (Doc. 28); the Court granted that motion,
and vacated all discovery and motions deadlines pending
resolution of Dockets 18 and 20. (Doc. 29). Therefore, the
exception to Rule 15(a) articulated in Kozlov does
not apply. 818 F.3d at 395.
Additionally,
no good reason for denial exists. See Thompson-El,
876 F.2d at 67. In his response, Brown does not oppose
SDI's Motion to Amend, and does not allege any undue
delay, bad faith, failure to cure previous deficiencies,
undue prejudice, or futility. (Doc. 21 at p. 2). Rather,
Brown asks for relief as stated in his Motion to Drop or
Substitute Party. Because the Court finds no good reason for
denial, leave to amend the complaint “shall be freely
given[.]” Fed.R.Civ.P. 15(a). For these reasons,
SDI's Motion to Amend (Doc. 18) is granted.
II.
Brown's Motion to Drop or Substitute Party
In his
Motion to Drop or Substitute Party under Federal Rule of
Civil Procedure 21, Brown argues that the “clear
purpose of this action is to coverage for property damage of
a third party and not to determine any possible liability of
Brown.” (Doc. 21 at p. 2). Therefore, “[l]eaving
Brown as a defendant in this case would serve no useful
purpose.” (Id.). Brown urges the Court to drop
him as a party or, in the alternative, substitute 21st
Century as the defendant in this action. (Id. at p.
3). SDI opposes Brown's motion.
Brown
brings his motion under Federal Rule of Civil Procedure 21.
Rule 21, entitled Misjoinder and Nonjoinder of Parties,
states: “Misjoinder of parties is not a ground for
dismissing an action. On motion or on its own, the court may
at any time, on just terms, add or drop a party. The court
may also sever any claim against a party.” Fed.R.Civ.P.
21. “Rule 21 of the Federal Rules of Civil Procedure is
the proper vehicle for dismissing parties who were improperly
joined-either because they fail to satisfy any of the
conditions of permissive joinder under Fed.R.Civ.P. 20(a) or
because no relief is demanded from [them, ] or no claim of
relief is stated against [them].” Moubry v.
Kreb, 58 F.Supp.2d 1041, 1047 (D. Minn. 1999) (quoting
Vakharia v. ...