GS Holistic, LLC v. Cigarette Outlet Smoke Shop ( 2023 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 GS HOLISTIC, LLC, Case No. 1:23-cv-00281-JLT-BAM 12 Plaintiff, ORDER GRANTING PLAINTIFF’S MOTION FOR LEAVE TO FILE 13 v. AMENDED COMPLAINT TO SUBSTITUTE DEFENDANT 14 CIGARETTE OUTLET SMOKE SHOP d/b/a CIGARETTE OUTLET SMOKE (Doc. 9) 15 SHOP and JOHN DOE, 16 Defendants. 17 18 Currently before the Court is Plaintiff GS Holistic, LLC’s motion for leave to file an 19 amended complaint to substitute the correct defendants. (Doc. 9.) No defendant has appeared in 20 this action and default has been entered against Defendant Cigarette Outlet Smoke Shop. (See 21 Doc. 7.) In the absence of any defendant appearing in this action, the matter is deemed submitted. 22 L. R. 230(g). 23 Having considered the unopposed motion and the record in this case, Plaintiff’s motion 24 for leave to file an amended complaint will be granted. 25 BACKGROUND 26 On February 25, 2023, Plaintiff filed this action for trademark infringement, 27 counterfeiting, and false designation of origin and unfair competition. (Doc. 1.) Plaintiff named 28 the following defendants: (1) Cigarette Outlet Smoke Shop d/b/a Cigarette Outlet Smoke Shop, a 1 company/corporation; and (2) John Doe, owner, manager, and/or operator of Cigarette Outlet 2 Smoke Shop. (Id. at ¶¶ 6, 7.) 3 On March 7, 2023, a proof of service was filed indicating that Defendant Cigarette Outlet 4 Smoke Shop was served by substituted service on “Samir Doe,” an employee at the business. A 5 copy of the summons and complaint were thereafter mailed to the same address. (Doc. 4.) 6 At Plaintiff’s request, on April 14, 2023, the Clerk of the Court entered default against 7 Defendant Cigarette Outlet Smoke Shop. (Doc. 7.) 8 On June 16, 2023, Plaintiff filed the instant motion seeking to amend the complaint to 9 substitute Defendant Maher Nagi in place of Defendant John Doe. (Doc. 9.) Plaintiff explains 10 that an investigation revealed that Maher Nagi is the actual owner of the store at issue in this 11 complaint and the correct defendants are “MAHER NAGI d/b/a CIGARETTE OUTLET SMOKE 12 SHOP and MAHER NAGI.” (Id. at ¶¶ 2-3, 5.) 13 DISCUSSION 14 Federal Rule of Civil Procedure 15(a) provides: 15 A party may amend its pleading once as a matter of course within: (A) 21 days after serving it; or (B) if the pleading is one to which a responsive pleading is required, 16 21 days after service of a responsive pleading or 21 days after service of motion under Rule 12(b), (e) or (f) whichever is earlier. 17 18 Fed. R. Civ. P. 15(a)(1). In all other cases, a party may amend it pleading only with the opposing 19 party’s written consent or the court’s leave. Fed. R. Civ. P. 15(a)(2). A court “should freely give 20 leave [to amend] when justice so requires.” Fed. R. Civ. P. 15(a)(2). The United States Supreme 21 Court has stated: 22 [i]n the absence of any apparent or declared reason—such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies 23 by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc. —the leave sought 24 should, as the rules require, be “freely given.” 25 Foman v. Davis, 371 U.S. 178, 182 (1962). The intent of the rule is to “facilitate decision on the 26 merits, rather than on the pleadings or technicalities.” Chudacoff v. Univ. Med. Center of S. Nev., 27 649 F.3d 1143, 1152 (9th Cir. 2011). Consequently, the “policy of favoring amendments to 28 pleadings should be applied with ‘extreme liberality.’” United States v. Webb, 655 F.2d 977, 979 1 (9th Cir. 1981). 2 Courts consider five factors in determining whether justice requires allowing amendment 3 under Rule 15(a): “bad faith, undue delay, prejudice to the opposing party, futility of amendment, 4 and whether the plaintiff has previously amended the complaint.” Johnson v. Buckley, 356 F.3d 5 1067, 1077 (9th Cir. 2004) (citation omitted); Bonin v. Calderon, 59 F.3d 815, 845 (9th Cir. 6 1995) (citing Western Shoshone Nat’l Council v. Molini, 951 F.2d 200, 204 (9th Cir. 1991)). 7 These factors are not of equal weight as prejudice to the opposing party has long been held to be 8 the most critical factor in determining whether to grant leave to amend. Eminence Capital, LLC 9 v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003) (“As this circuit and others have held, it is 10 the consideration of prejudice to the opposing party that carries the greatest weight”); Jackson v. 11 Bank of Hawaii, 902 F.2d 1385, 1387 (9th Cir. 1990) (“Prejudice to the opposing party is the 12 most important factor.”). Absent prejudice, or a strong showing of any of the remaining factors, a 13 presumption exists under Rule 15(a) in favor of granting leave to amend. Eminence Capital, 316 14 F.3d at 1052. 15 In this case, no responsive pleading has been filed and Plaintiff may amend the complaint 16 as a matter of course pursuant to Fed. R. Civ. P. 15(a)(1). See Hutchins v. Lockyer, No. 1:15-cv- 17 01537-MJS (PC), 2016 WL 6094853, at *1 (E.D. Cal. Oct. 17, 2016) (“A party may amend its 18 pleading once as a matter of course at any time before a responsive pleading is served and up to 19 twenty-one days after service of a responsive pleading. Fed. R. Civ. P. 15(a)(1)(B).”). Even if 20 that were not the case, the Court finds leave to amend under Rule 15 appropriate given the early 21 stages and procedural posture of this action. There will be little prejudice to defendants in 22 permitting the amendment as defendants will need to be properly served with any amended 23 complaint.1 Plaintiff also has not unduly delayed in seeking to amend the complaint, the 24 amendment is not brought in bad faith, and there is no indication that such amendment is futile. 25 26 1 The Court recognizes that default has been entered against Defendant Cigarette Outlet Smoke Shop. (Doc. 7.) However, the substance of the instant motion calls into question whether the proper defendant 27 was served. Upon filing of the amended complaint, Plaintiff is directed to file either (1) a declaration supporting entry of default against Defendant Cigarette Outlet Smoke Shop; or (2) a request to set aside 28 and/or vacate entry of default against Defendant Cigarette Outlet Smoke Shop. 1 Accordingly, leave to file a first amended complaint will be granted for the purpose of naming the 2 correct defendants. 3 CONCLUSION AND ORDER 4 For the reasons discussed above, IT IS HEREBY ORDERED that: 5 1. Plaintiff’s motion for leave to file an amended complaint (Doc. 9) is GRANTED; 6 and 7 2. Within five (5) court days after issuance of this Order, Plaintiff shall file the First 8 Amended Complaint, a copy of which was attached as Exhibit A to the motion. 9 IT IS SO ORDERED. 10 11 Dated: June 27, 2023 /s/ Barbara A. McAuliffe _ UNITED STATES MAGISTRATE JUDGE 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28