United States District Court, D. New Jersey
JOSE LUIS PELAEZ, INC. AND JOSE PELAEZ, Plaintiffs,
PEARSON EDUCATION, INC., Defendant.
WILLIAM J. MARTINI, U.S.D.J.
Jose Luis Pelaez, Inc. and Jose Pelaez (together,
“Pelaez”) bring this copyright infringement
action against Defendant Pearson Education, Inc.
(“Pearson”). Pelaez contends Pearson infringed
his copyrights in certain photographs (the
“Photographs”). Compl. ¶ 1, Ex. 1, ECF No.
1. Before the Court is Pelaez's Motion for Leave to File
a First Amended Complaint. Pls.' Mot., ECF No. 67. The
Court decides the matter on the papers without need for oral
argument. Fed.R.Civ.P. 78(b); Local Civ. R. 78.1(b). For the
reasons given below, the motion is DENIED.
is a professional photographer and president and sole owner
of Jose Luis Pelaez, Inc. Compl. ¶ 2. Pearson publishes
school textbooks and other educational materials.
Id. ¶¶ 3, 10. Pelaez owns the copyrights
to the Photographs, which “have been registered with
the United States Copyright Office or having pending
copyright registrations.” Id. ¶ 7. From
1992 to 2016, Pelaez had agreements with stock photograph
agencies, including Corbis Corporation
(“Corbis”), which authorized Corbis to grant
third parties like Pearson limited licenses to use the
Photographs. Id. ¶¶ 8, 9.
August 26, 2016, Pelaez filed suit against Pearson. He
alleges Pearson infringed his copyrights to the Photographs
when Pearson exceeded usage restrictions in the licensing
agreements because “Pearson reproduced and distributed
the Photographs without [Pelaez's] permission to . . .
third parties” worldwide. Id. ¶ 17. Also,
“Pearson knew, when it reproduced and distributed the
Photographs to the Third Parties-which Pearson did not have
the right to do-that the Third Parties would subsequently
[and continuously] reproduce and distribute the Photographs
without [Pelaez's] authorization.” Id.
¶¶ 21, 22.
the parties completed discovery in June 2018, Pelaez contends
he “disclosed to Pearson the claims he intended to take
to trial in his claims summary, served on June 7,
2018.” Pls.' Mot. at 12. Five months later, the
parties filed competing motions for summary judgment.
Pearson's Summ. J. Mot., ECF Nos. 43; Pls.' Partial
Summ. J. Mot., ECF No. 45. After filing its motion, Pearson
filed a supplemental motion for summary judgment upon
learning that Pelaez had submitted new copyright
registrations with the Copyright Office on hundreds of the
Photographs. Suppl. Summ. J. Mot. 1, ECF No. 56. Pelaez
submitted these new applications on February 3, 2017, during
litigation and more than six months after he filed
this action in which he alleged to have already registered or
had pending registrations on the Photographs. See
Id. at 5-6; Compl. ¶ 7.
contends he included the new registrations in a spreadsheet
provided in discovery and there was no need to inform Pearson
of the disparity between allegations in the Complaint of
having registered the Photographs before filing suit and then
applying for copyright registration only after he filed the
Complaint. Pls.' Mot. at 3-4. Pearson faults Pelaez for
withholding disclosure, since he had opportunities to share
the new registration information days later at a February 8,
2017 conference, in the Joint Discovery Plan submitted two
weeks later, or at the Rule 16 conference. Def.'s
Opp'n 14, ECF No. 70.
Pearson's original and supplemental summary judgment
motions and notice of motion for sanctions, Pelaez now seeks
leave “to clarify the facts and allegations currently
at issue in this case” and “narrow the
pleadings by removing certain infringement allegations based
on Pearson's discovery production.” Pls.' Mot.
at 2. Specifically, Pelaez intends to (1) supplement the
copyright registrations obtained after he filed suit and (2)
withdraw certain infringement claims for which Pearson had
already moved for summary judgment, which Pelaez opposed. Yet
Pelaez argues amendment is unnecessary because “every
single claim identified in [his] proposed [First Amended
Complaint] was asserted in the original Complaint.”
Pls.' Reply 9, ECF No. 71; id. at 7 & n.15
(“Pelaez strongly disputes Pearson's contentions
and does not believe that amendment is actually necessary
here, ” because “the Corbis registrations remain
a legally sufficient basis for suit.”). Pelaez also
seeks to “withdraw claims where the evidence produced
does not reflect infringement by Pearson to date and where
Pearson's records have apparently gone missing.”
Pls.' Mot. at 13.
Rule of Civil Procedure 15(a) governs motions to amend. At
this stage, “a party may amend its pleadings only with
the opposing party's written consent or the court's
leave.” Fed.R.Civ.P. 15(a)(2). Leave to amend is
generally granted unless there is: (1) undue delay or
prejudice; (2) bad faith; (3) dilatory motive; (4) failure to
cure deficiencies through previous amendment; or (5)
futility. Foman v. Davis, 371 U.S. 178, 182 (1962);
Lorenz v. CSX Corp., 1 F.3d 1406, 1413-14 (3d Cir.
1993). The ultimate decision to grant or deny leave is
committed to a court's discretion. See, e.g.,
Zenith Radio Corp. v. Hazeltine Research, Inc., 401
U.S. 321, 330 (1970); Arab African Int'l Bank v.
Epstein, 10 F.3d 168, 174 (3d Cir. 1993).
seeks leave to add the copyright registrations after he filed
suit and withdraw certain infringement claims for which
Pearson had already moved for summary judgment. See
Pls.' Mot at 1-2. Pearson opposes, arguing Pelaez cannot
alter the shape of the case after the parties each moved for
summary judgment because Pelaez's bad faith and undue
delay in seeking leave to amend at this late stage in the
proceedings, together with prejudice to Pearson, compels
denying the motion. Def.'s Opp'n at 6.
to the non-moving party is the touchstone for the denial of
an amendment.” Lorenz, 1 F.3d at 1414.
Incidental prejudice, such as delay alone, is insufficient
grounds to deny leave to amend. See In re Caterpillar,
Inc., 67 F.Supp.3d 663, 668 (D.N.J. 2014); Cornell
& Co., Inc. v. Occupational Safety & Health Review
Comm'n, 573 F.2d 820, 823 (3d Cir. 1978). When
evaluating prejudice, courts must consider whether amendment
would: (1) require the non-moving party to expend significant
additional resources to conduct discovery and prepare for
trial; (2) significantly delay resolution of the case; or (3)
prevent the non-moving party from bringing a timely action in
another forum. See, e.g., Long v. Wilson,
393 F.3d 390, 400 (3d Cir. 2004) (internal citations
omitted). Generally, when a “proposed amendment
requires the reopening of discovery, the prejudice to the
non-moving party will be considered greater than if the
proposed amendment presents only a new issue of law.”
Voilas v. General Motors Corp., 173 F.R.D. 389, 396
(D.N.J. 1997) (internal citations and quotations omitted).
When a plaintiff seeks to withdraw claims, a defendant
suffers prejudice when it “face[s] the prospect of
potentially relitigating, at some later date, claims it had
put significant time and resources into defending and already
litigated to the summary-judgment stage.” Estate of
Ware v. Hosp. of the Univ. of Penn., 871 F.3d 273, 286
(3d Cir. 2017), cert. denied sub nom. Boyer v. Hosp. of
the Univ. of Penn., 138 S.Ct. 2018 (2018).
will deny a motion to amend where the movant's
unexplained delay suggests bad faith or tactical
design.” Phillips v. Borough of Keyport, 179
F.R.D. 140, 149 (D.N.J. 1998). For example, a plaintiff
seeking leave to amend when the defendant already
“moved for summary judgment may be maneuvering
desperately to stave off the immediate dismissal of the
case.” Id. at 145 (quoting Cowen v. Bank
United of Texas, FSB, 70 F.3d 937, 943 (7th Cir. 1995)).
When seeking leave to amend after the defendant filed a
motion for summary judgment, courts in this District evaluate
proposed amendments under a “heightened
standard.” Id. The plaintiff must “show
not only that the proposed amendment has ‘substantial
merit' . . . but also come forward with
‘substantial and convincing evidence' supporting
the newly asserted claim.” Phillips, 179
F.R.D. at 145 (citations omitted); see also Cowen,
70 F.3d at 944 (citing First Circuit Court of Appeals
precedent in applying a “substantial and convincing
evidence” standard to support a proposed amendment when
a plaintiff sought leave to amend after the defendant filed a
summary judgment motion). Thus, “the question of undue