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B.A.T. Wear, Inc. v. Resourcing America

November 1, 2006

RE: B.A.T. WEAR, INC. AND PHOENIX WHOLESALE, INC.,
v.
RESOURCING AMERICA, INC. AND 1ST CONSTITUTION BANK



The opinion of the court was delivered by: Ronald J. Hedges United States Magistrate Judge

CHAMBERS OF RONALD J. HEDGES UNITED STATES MAGISTRATE JUDGE

MARTIN LUTHER KING, JR. FEDERAL BUILDING AND COURTHOUSE 50 WALNUT STREET NEWARK, NJ 07101 973-645-3827

LETTER-OPINION AND ORDER ORIGINAL FILED WITH CLERK OF THE COURT

Dear Counsel:

INTRODUCTION

This matter comes before me on the motion of plaintiffs for leave to file a Third Amended Complaint pursuant to Rule 15(a). I have considered the papers submitted in support of and in opposition to the motion. There was no oral argument. Rule 78.

BACKGROUND

This motion stems from plaintiffs B.A.T. Wear, Inc. ("B.A.T.") and Phoenix Wholesale, Inc. ("Phoenix") breach of contract claims against defendants Resourcing America, Inc. and 1st Constitution Bank involving the sale of certain goods (the "goods") and a related letter of credit transaction.

Plaintiffs allege that the goods were secured by a letter of credit issued by defendant 1st Constitution Bank on behalf of Phoenix. Resourcing America allegedly failed to deliver the goods on the contracted delivery date. Plaintiffs further allege that Resourcing America disregarded B.A.T.'s notice rejecting the belated shipment, failed to notify B.A.T. that the goods were in Port Newark, and improperly received payment from Phoenix's letter of credit at 1st Constitution Bank. In addition, plaintiffs allege that Resourcing America intentionally removed and withheld the original visas and shipping documents that accompanied the goods. Without these documents, B.A.T. was unable to clear the goods.

On September 25, 2006, plaintiffs filed the pending motion, seeking to add Charles Anteby as a party defendant.

DISCUSSION

Rule 15(a) provides in relevant part that, "a party may amend the party's pleading only by leave of court or by written consent of the adverse party; and leave to amend shall be freely given when justice so requires." Leave to amend may be denied for four reasons: 1) undue delay, 2) bad faith or dilatory motive, 3) undue prejudice, or 4) futility of amendment. Foman v. Davis, 371 U.S. 178, 182 (1962); Rolo v. City of Investing Co. Liquidating Trust, 155 F.3d 644, 654 (3d Cir. 1998).

Rule 15(a) reflects the "principle that the purpose of pleading is to facilitate a proper decision on the merits," and that if the underlying facts relied upon by a party might be a proper subject of relief, that party should have the opportunity to test its claims on the merits. Foman, 317 U.S. at 182 (quoting Conley v. Gibson, 355 U.S. 41, 48 (1957)). Courts should liberally permit amendment and the discretion to do so rests with the court. See, e.g., Heyl & Paterson v. F.D. Rich Housing of Virgin Islands, 663 F.2d 419, 425 (3d ...


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