Leonard P. Stark: Document Production Prior to Amendment Deadline Precludes New Counterclaim

Although parties to litigation enjoy a wide latitude in amending pleadings, the ability to change one’s case theory midstream has its limits. A recent decision by Magistrate Judge Leonard P. Stark demonstrates these boundaries. In the underlying infringement litigation, Facebook sought to amend its false-marking counterclaim outside the confines of the scheduling order. Looking to Rule 16(b)’s “good cause” standard, the Court denied Facebook’s request on diligence grounds.

Specifically, the Court emphasized Facebook’s possession of the documents necessary to its proposed pleading prior to the amendment deadline:

“[I]t appears that Facebook possessed documents containing examples of how Leader marked its . . . products before it previously moved to add the false marking claim. Facebook provides no explanation for why, in light of this information, it could not reasonably have complied with the Scheduling Order. Accordingly, the Court concludes that Facebook has not shown that good cause exists to amend its responsive pleading with regard to the false marking counterclaim.”

By doing so, the Court gave clear guidance to the litigator: diligence for purposes of Rule 16(b)’s “good cause” standard includes a timely review of an opposing party’s document production.

Leader Technologies, Inc. v. Facebook, Inc., C.A. No. 08-862-LPS (D. Del. June 24, 2010) (Stark, M.J.).

In a related decision, Judge Farnan approved two discovery orders issued by Magistrate Judge Stark in this case – one on the common-interest privilege and the other allowing a restricted reopening of discovery. Read the decision here.

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