Opinion
07 Civ. 365 (CSH) (ECF).
August 13, 2008
MEMORANDUM OPINION AND ORDER
Plaintiff Robert Ginsberg ("Ginsberg" or "Plaintiff") filed this breach of contact action against defendant Government Properties Trust, Inc. ("GPT" or "Defendant") to recover damages for Defendant's alleged failure to compensate Plaintiff for services he claims he provided in connection with certain real estate transactions. In a Memorandum Opinion and Order dated October 10, 2007, the Court denied Defendant's motion to dismiss the complaint. Plaintiff now moves under Fed.R.Civ.P. 15(a) to amend his complaint to assert additional claims against GPT to recover for services he allegedly rendered in connection with a real estate transaction in Martinsburg, West Virgina. For the reasons that follow, plaintiff's motion is granted.
I. FACTUAL BACKGROUND
The facts of the case are set forth in detail in the Court's prior opinion, Ginsberg v. Government Properties Trust, No. 07 Civ 365 (CSH), 2007 WL 2981683, (Oct. 10, 2007 S.D.N.Y.), familiarity with which is assumed. The Court restates the underlying facts to the extent necessary to comprehend Plaintiff's motion to amend.
Beginning around May of 2004, Plaintiff and two individuals named Richard Mark and Charmaine Mark (collectively "the Marks") began a business venture in which they attempted to raise funding for investment in real property primarily occupied on a long term basis by the United States and/or state government departments and agencies. Ginsberg and the Marks entered into discussions with Defendant GPT throughout the second half of 2004 and allegedly entered into an oral agreement in which the three of them would locate possible properties for purchase by GPT. In February 2005, GPT entered into a separate written agreement with Ginsberg (the "GPT-Ginsberg Agreement") which governed the compensation GPT agreed to pay Ginsberg for his services.
Plaintiff now seeks to amend his complaint to recover for services he allegedly rendered in connection with GPT's purchase of the IRS Building located in Martinsburg, West Virginia ("the IRS Building"). This transaction was not the subject of the original complaint which involves services Plaintiff allegedly provided in connection with GPT's purchase of the Environmental Protection Agency building, located in Denver, Colorado. Plaintiff alleges that in or around July 2004, he and Richard Marks met with Bill Hard, Executive Vice President of LCOR, a real estate investment and development company, to discuss potential acquisitions of government leased property. See Aff. of Robert Ginsberg in Supp. of Pl.'s Mot. to Amend Compl. ("Ginsberg Aff.") ¶ 7. Thereafter, in October or November 2004, Plaintiff claims Hard indicated to Ginsberg and the Marks that he would provide them with information on the IRS Building once LCOR was ready to sell the property and before it listed the property with a real estate brokerage company. Id. ¶ 8. Plaintiff claims that he and the Marks communicated the status of these negotiations to Thomas Peschio, the President and CEO of GPT, in an e-mail correspondence dated December 10, 2004. Id. ¶ 9. Allegedly, Peschio responded in a December 10, 2004 email that "should the Marks and [Ginsberg] satisfy certain conditions and the transaction with Martinsburg be completed, then the IRS Building would be included in our agreement." Id. ¶ 10. Plaintiff claims that he was kept abreast of communications between LCOR and GPT regarding the potential acquisition of the IRS Building through approximately January, 2005, but thereafter he was excluded from subsequent correspondence concerning the IRS Building. Id. ¶ 11. Plaintiff claims that after reviewing the March 26, 2008 Peschio deposition, he learned for the first time that GPT purchased the IRS Building on or about July 27, 2005. Id. ¶ 13. Ginsberg complains that he was not compensated in connection with this purchase, as provided for in the GPT-Ginsberg Agreement. Ginsberg thus seeks to amend his complaint to assert additional claims for breach of contract, quantum merit and unjust enrichment arising out of GPT's purchase of the IRS Building.
II. DISCUSSION
Rule 15(a) of the Federal Rules of Civil Procedure provides that leave to amend a pleading "shall be freely given when justice so requires." Fed.R.Civ.P. Rule 15(a). The Supreme Court articulated specific grounds that would defeat this liberal standard, "such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of the amendment, etc." Foman v. Davis, 371 U.S. 178, 182 (1962); see also Milanese v. Rust-Oleum Corp. 244 F. 3d 104, 110 (2d Cir. 2001).
GPT makes much of Ginsberg's delay in filing the motion to amend. It complains that the motion to amend should be denied on account on its having been filed approximately three years after GPT purchased the IRS Building. GPT further argues that although Ginsberg alleges he did not become aware of GPT's purchase of the property until March 26, 2008, he had "inquiry notice" of the purchase as of July 28, 2005; the date GPT issued a press release announcing the acquisition. See Def.'s Mem. in Opp'n at 5.
While delay in amending the pleadings is a factor to be considered in determining whether leave should be given, delay is ordinarily not, by itself, a sufficient ground for denial of leave to amend. See 3 JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE ¶ 15.15 (3d ed. 2007); Ragman Bag Co. v. Liberty Mut. Ins. Co., 46 F.3d 230, 234-235 (2d Cir. 1995) (delay alone usually does not warrant denial, even after four years had passed since filing of original complaint). The opposing party must also show that some prejudice to her would result from permitting the amendment. Id.
In determining what constitutes prejudice in this context, courts consider whether the proposed amendment would require the opponent to expend significant additional resources to conduct discovery and prepare for trial and whether the amendment would significantly delay the resolution of the dispute. See Grace v. Rosenstock, 228 F.3d 40, 53-54 (2d Cir. 2000) (citing cases). GPT argues that an amendment to the complaint will be especially prejudicial because of the additional discovery that would be required. However, the claims in the proposed amendment arise out of the same agreement that is the subject of the underlying complaint-thereby minimizing the need for significant additional discovery. Additionally, the legal issues raised by the proposed amendment and likely defenses are quite similar to those involved in the original claims. Also, there are no pending dispositive motions and no trial date has been set by the Court. Therefore, defendant will incur little extra time or expense in defending the new claims. Under these circumstances, I am not convinced that permitting the proposed amendment will unduly prejudice GPT.
If leave to amend the complaint to add this additional claim arising out of the same contract were denied, no reason appears why Plaintiff could not file a separate action alleging this additional claim and then move to consolidate the two cases for all purposes. Nothing is to be gained by requiring the Plaintiff to go to this additional effort. The addition of a claim arising out of the same contract alleged in the original complaint is an entirely appropriate subject for a Rule 15 amendment.
GPT further protests that the claims Ginsberg asserts in the proposed amendment are futile because he has failed to demonstrate that the IRS Building falls within the scope of the GPT-Ginsberg Agreement and the Acquisition Status Reports Ginsberg points to do not provide support for the position that GPT's purchase of the IRS Building was "in progress" during the relevant time period. Def.'s Mem. in Opp'n, at 8.
I agree with Plaintiff that these issues may not be resolved within the context of a motion to amend the complaint. The Second Circuit has instructed that "leave to amend will be denied as futile only if the proposed new claim cannot withstand a 12(b)(6) motion to dismiss for failure to state a claim, i.e., if it appears beyond doubt that the plaintiff can plead no set of facts that would entitle him to relief." Milanese, 244 F.3d at 110. After a careful review of the proposed amended complaint, I conclude that Plaintiff has alleged facts that plausibly support a breach of contract claim. See also Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1974 (2007) (For a plaintiff's complaint to survive dismissal under Rule 12(b)(6), the plaintiff must plead "enough facts to state a claim to relief that is plausible on its face").
Additionally, because the parties dispute whether the real estate transaction at issue falls within the scope of the GPT-Ginsberg Agreement, plaintiff may proceed on his alternative quasi-contractual claims. See CBS Broad., Inc. v. Jones, 460 F. Supp. 2d 500, 506 (S.D.N.Y. 2006) (where "there is a bona fide dispute as to the existence of a contract or where the contract does not cover the dispute in issue, [a party] may proceed upon a theory of quantum merit and will not be required to elect his or her remedies") (citations omitted).
III. CONCLUSION
For the foregoing reasons, Plaintiff Robert Ginsberg's motion for leave to amend his complaint is granted. Plaintiff is directed to file and serve an amended complaint in the form attached as an exhibit to his motion papers. Defendant GPT is directed to file and serve an answer to the amended complaint on or before September 2, 2008.
It is SO ORDERED.