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New Jersey Physicians United Reciprocal Exchange v. Boynton & Boynton, Inc.

United States District Court, D. New Jersey

December 16, 2014

NEW JERSEY PHYSICIANS UNITED RECIPROCAL EXCHANGE, Plaintiff,
v.
BOYNTON & BOYNTON, INC., et al. Defendants.

MEMORANDUM OPINION

TONIANNE J. BONGIOVANNI, Magistrate Judge.

Currently pending before the Court is Defendant Boynton & Boynton, Inc.'s ("Boynton") cross motion seeking leave to file Amended Counterclaims and Third-Party Complaint. [Docket Entry No. 54]. Plaintiff New Jersey Physicians United Reciprocal Exchange ("NJPURE") opposes Boynton's cross motion. The Court has reviewed all arguments made in support of and in opposition to Boynton's cross motion along with Boynton's proposed First Amended Counterclaim, Third-Party Complaint and Demand for Trial by Jury. The Court considers Boynton's cross motion without oral argument pursuant to L.Civ.R. 78.1(b). For the reasons set forth more fully below, Boynton's cross motion is GRANTED.

I. Background and Procedural History

NJPURE initiated this matter on September 7, 2012 by filing a Complaint against Boynton & Boynton, Inc., Kevin Byrne ("Byrne") and several John Doe Defendants alleging unfair competition under the Lanham Act, various defamation claims, tortious interference with prospective contractual relationships and violations of the New Jersey Insurance Trade Practices Act (the "ITPA"). ( See generally Compl.; Docket Entry No. 1). On September 21, 2012, NJPURE amended its Complaint as of right against all Defendants. [Amended Compl.; Docket Entry No. 4]. The claims asserted remained the same in the Amended Complaint. In response to NJPURE's pleading, Boynton and Byrne moved to dismiss NJPURE's Amended Complaint. ( See Def. Motion to Dismiss; Docket Entry No. 13). On May 3, 2013, the District Court entered an Order denying Boynton and Byrne's motion to dismiss without prejudice, permitting NJPURE to file a Second Amended Complaint to include any newly discovered information and allowing Boynton and Byrne to move to dismiss the Second Amended Complaint if they believed the new allegations failed to state a claim. (Order of 5/3/2013; Docket Entry No. 23).

NJPURE filed its Second Amended Complaint on May 17, 2013. (Second Amended Compl.; Docket Entry No. 26). Boynton and Byrne again moved to dismiss NJPURE's pleading. (Def. Motion to Dismiss; Docket Entry No. 31). On January 28, 2014, the District Court entered an Opinion and Order granting in part and denying in part Boynton and Byrne's motion to dismiss. (Op. & Order of 1/28/2014; Docket Entry Nos. 39 & 40). The District Court denied Boynton and Byrne's motion with respect to NJPURE's Lanham Act and state law defamation claims, but granted it with respect to NJPURE's ITPA claim, which it dismissed. ( Id. )

In light of the fact that the District Court decided Boynton and Byrne's motion to dismiss NJPURE's Second Amended Complaint on January 28, 2014, Boynton and Byrne's responsive pleading was due 14 days later on February 11, 2014. See Rule 12(a)(4) (stating that "if the court denies the motion..., the responsive pleading must be served within 14 days after notice of the court's action"); Rule 13(a)(1)(A) (stating that "[a] pleading must state as a counterclaim any claim - at the time of its service - the pleader has against an opposing party if the claim: arises out of the transaction or occurrence that is the subject matter of the opposing party's claim"). Boynton and Byrne, however, filed their Answer to NJPURE's Second Amended Complaint along with a Third-Party Complaint against Eric Poe and Joanna Elias, and Counterclaims against NJPURE on February 28, 2014, 17 days late. [Docket Entry No. 44]. NJPURE, Eric Poe and Joanna Elias moved to dismiss Boynton and Byrne's Third-Party Complaint and Counterclaims. (Pl. Motion to Dismiss; Docket Entry No. 49).[1] Boynton opposed NJPURE, Eric Poe and Joanna Elias' motion and cross moved to amend. [Docket Entry No. 54].

Via its cross motion, Boynton sought to amend its Counterclaims and Third-Party Complaint in order to correct certain "clerical error[s.]" (Boynton's Cross Motion at 8; Docket Entry No. 54). Specifically, Boynton sought to (1) remove all references to the ITPA; (2) remove the allegation that University Radiology Group left Boynton and began procuring medical malpractice insurance through NJPURE after receiving solicitations from Eric Poe; (3) clarify that Count I of the Counterclaims and Third-Party Complaint alleges a violation of 15 U.S.C. § 1125(a)(1)(A); and (4) clarify that Count II of the Counterclaims and Third-Party Complaint alleges a violation of 15 U.S.C. § 1125(a)(1)(B) not § 1125(b). NJPURE, Eric Poe and Joanna Elias opposed Boynton's cross motion.

On September 29, 2014, the District Court granted NJPURE, Eric Poe and Joanna Elias' motion to dismiss and struck Boynton and Byrne's Counterclaims and Third-Party Complaint. (Order of 9/29/2014; Docket Entry No. 64). Importantly, in striking the Counterclaims and Third-Party Complaint, the District Court did not reach the merits of Boynton and Byrne's pleadings. ( Id. at 2 (holding that "the Court strikes Defendants' Counterclaims and Third-Party Complaint, without deciding the merits of Defendants' pleadings on this motion")).[2] Instead, the District Court struck Boynton and Byrne's Counterclaims and Third-Party Complaint because "Defendants did not file their responsive pleading until February 28, 2014, thirty-one days after the Court's decision[, ]" and did so without first "seek[ing] an extension of time to file" and without "provid[ing] any reason as to why their filing is untimely[.]" ( Id. at 1). Under these circumstances, the District Court found that "it would not be appropriate for the Court to exercise its discretion to extend Defendants' time to answer nunc pro tunc, especially in light of Defendants having admitted to the following clerical errors' contained in their Counterclaims and Third-Party Complaint..." ( Id. at 1-2).[3]

Upon striking Boynton and Byrne's Counterclaims and Third-Party Complaint, the District Court referred Boynton's pending cross motion to file an Amended Third-Party Complaint and Counterclaims to this Court. Subsequently, Boynton and NJPURE filed additional briefing with respect to same. ( See Def. Supp. Br., Docket Entry No. 65; Pl. Supp. Opp. Br., Docket Entry No. 66; and Def. Supp. Reply Br., Docket Entry No. 68). The Court now addresses Boynton's pending cross motion to amend.[4] ( Id. )

II. Analysis

A. Motions to Extend Time

1. Standard of Review

Pursuant to Federal Rule of Civil Procedure ("Rule") 6(b)(1)(B), "[w]hen an act may or must be done within a specified time, the court may, for good cause, extend the time: on motion made after the time has expired if the party failed to act because of excusable neglect." "When determining whether a party has shown excusable neglect, ' courts take into account all relevant circumstances surrounding the party's omission, ' including the danger of prejudice to the opposing party, the length of the delay in responding and its potential impact on judicial proceedings, the reason for the delay, including whether it was within the reasonable control of the movant, and whether the movant acted in good faith.'" Thompson v. Warren, Civil Action No. 13-4334 (JAP), 2014 WL 4953249, *1 (D.N.J. Oct. 2, 2014) (quoting Pioneer Inv. Serv. Co. v. Brunswick Assocs. Ltd. P'ship, 507 U.S. 380, 395, 113 S.Ct. 1489, 123 L.Ed.2d 74 (1993)).

"Although inadvertence, ignorance of the rules, or mistakes construing the rules do not usually constitute excusable' neglect, it is clear that excusable neglect' under Rule 6(b) is a somewhat elastic concept' and is not limited strictly to omissions caused by circumstances beyond the control of the movant." Pioneer, 507 U.S. at 392. Instead, the Supreme Court has noted that the phrase is given its "commonly accepted meaning." ( Id. ) As such, the Supreme Court found it "not surprising... that in ...


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