Northwest Environmental Defense Center v. H&H Welding et al, No. 3:2013cv00653 - Document 17 (D. Or. 2013)
Court Description: OPINION and ORDER - NEDC's motion 11 for leave to file plaintiff's first amended complaint is GRANTED. NEDC's first amended complaint is to be filed on or before 9/19/13. IT IS SO ORDERED. DATED this 5th day of September 2013, by United States Magistrate Judge John V. Acosta. (peg)
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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF OREGON PORTLAND DIVISION 3:13-cv-653-AC NORTHWEST ENVIRONMENTAL DEFENSE CENTER, OPINION AND ORDER Plaintiff, v. H&H WELDING; JOHNSON TRAN, an individual; PARKROSE AUTO CENTER, LLC, an Oregon domestic limited liability company; SUKHVINDER SINGH BRAR, an individual; JASPAL KAUR BRAR, an individual, Defendants. ACOSTA, Magistrate Judge: Pending Motion Northwest Environmental Defense Center ("NEDC") filed this Complaint for injunctive and declaratory relief and civil penalties under the Federal Water Pollution Control Act, commonly referred to as the Clean Water Act, 33 U.S. C.§§ 1251-1387. NEDC brings this citizen suit under 1 - OPINION AND ORDER section 505(a)(l) of the Clean Water Act, 33 U.S.C. §1365(a)(l), against H&H Welding and its owner, Johnson Tran, and Parkrose Auto Center, LLC, and two of its corporate officers, Sukhvinder Singh Brar and Jaspal Kaur Brar, for past and continuing violations of the Clean Water Act. NEDC alleges all defendants are discharging industrial stormwater into the Columbia Slough without a permit, in violation of the Clean Water Act, 33 U.S.C. § 13ll(a). According to NEDC, the violations are ongoing as of the date of the Complaint. NEDC seeks declarat01y and injunctive relief and the imposition of civil penalties resulting from these violations, along with an award of costs and attorney fees pursuant to 33 U.S.C. § 1365(d). NEDC filed its Complaint on Aprill6, 2013. Sukhvinder Brar filed an Answer on May 14, 2013, and Johnson Tran filed an Answer on May 24, 2013. Neither Jaspal Kaur Brar nor the c01porate defendants have entered an appearance in tbis case. On June 21, 2013, NEDC filed a Motion for Leave to File Plaintiffs First Amended Complaint. NEDC explains an Amended Complaint is necessmy because the unpermitted discharge of stormwater runoff from an industrial facility into the Columbia slough continues from the same facility but the operation has changed names, a new corporate entity has been created, and some of the owners and operators have changed roles. Specifically, the auto dismantling operation 5242 NE Columbia Blvd., Portland, Oregon, 97218 (the "Facility") has changed names from Parkrose Auto Center, LLC to Parkrose Auto Recycling, LLC. The new corporation, Parkrose Auto Recycling, LLC, was recently formed by an employee of the original operation- Parkrose Auto Center, LLC- Moyata Anotta. NEDC seeks leave to amend its pleading to join this new c01porate entity and its owner. In addition, NEDC will include a Third Claim for Relief under§ 1311 (a) against Parkrose Auto Recycling, LLC, and Moyata 2 - OPINION AND ORDER Anotta. No opposition to NEDC's motion has been filed. For the reasons set f01ih below, NEDC's motion is granted. Legal Standard Under FED. R. CIV. P. 15(a)(l ), a party may amend its pleading once as a matter of course before being served with a responsive pleading or within 21 days after serving the pleading, if a responsive pleading is not allowed. "In all other cases, a patiy may amend its pleading only with the opposing party's written consent or the court's leave." FED. R. CIV. P. 15(a)(2). When deciding whether to grant leave to amend, the couti considers four factors: (1) undue delay; (2) bad faith; (3) futility of amendment; and (4) prejudice to the opposing patiy. Texaco, Inc. v. Ponsoldt, 939 F.2d 794, 798 (9th Cir. 1991). Rule 15 requires "[t]he court should freely give leave when justice so requires." Fed. R. Civ. P. 15(a)(2). The court recognizes that a liberal standard is applied to motions for leave to amend. AmerisourceBergen Co. v. Dialysist West, Inc., 465 F.3d 946, 951 (9th Cir. 2006). Discussion According to NEDC, the premise underlying the cause of action in the original Complaint and the proposed Amended Complaint is the same: the unlawful and unpetmitted discharge of stormwater associated with an industrial activity to a water of the United States. See 33 U.S.C. § 1311(a) ("Except in compliance with [various provisions of the Clean Water Act] the discharge of any pollutant by any person shall be unlawful."). NEDC explains the original Complaint challenged the actions by two sets of actors: the landowner, Johnson Tran and his business, H&H Welding; and the original tenant and operator, Parkrose Auto Center, LLC, and its responsible corporate officers, 3 - OPINION AND ORDER Sukhvinder Brar and Jaspal Brar. The Amended Complaint seeks to add the new actors, who have continued the same, unlawful conduct- namely Moyata Anotta and Parkrose Auto Recycling, LLC. In addition, NEDC proposes amending the Complaint to add a Third Claim for Relief against the cmTent operator of the facility, Parkrose Auto Recycling, LLC, and Moyata Anotta. In support of this claim, NEDC revised and updated the factual background and allegations underlying the claims presented and the relief requested to describe the actions the various defendants have taken over the past several months to shift control of the dismantler operation from one corporate entity to another. A. Undue Delay A party's undue delay and failure to explain the reason for the delay weigh against leave to amend under Rule 15. Swanson v. US. Forest Serv., 87 FJd 339, 345 (9th Cir.1996); Texaco, Inc., 939 F.2d at 799. Neve1iheless, delay alone, no matter how lengthy, cannot justify denial of amotion to amend. See, e.g., Bowles v. Reade, 198 F.3d 752, 758 (9th Cir. 1999) (Ninth Circuit will reverse a denial of a motion for leave to amend in the absence of a contemporaneous specific finding of prejudice to the opposing pmiy, bad faith by the moving pmiy, or futility of the amendment.) Here, NEDC contends it moved to amend its pleading at the earliest possible moment. Based upon the information available to NEDC at the time of the original Complaint, it appeared Parkrose Auto Center, LLC, operated the auto dismantling at the facility. In fact, Parkrose Auto Center, LLC, did not cease its operations at the Facility until April19, 2013, three days after the Complaint was filed. On January 23, 2013, shmily before filing the Complaint, NEDC did discover the Facility manager, Moyata Anotta, had formed a new corporate entity, Parkrose Auto Recycling, LLC. Subsequent review of available public records revealed Parkrose Auto Recycling, LLC, received a 4 - OPINION AND ORDER r Vehicles on Februmy 29, 2013. Dismantler Certificate from the Oregon Department of Moto technically was in charge of the Although this new infotmation raised some questions about who reasonably believed Parkrose operation, based upon the infotmation available at the time NEDC Auto Center, LLC, was operating at the Facility. In an effo1t to resolve the confusion and to identify the operator of the Facility, on April l6, - a prerequisite to a citizen suit 2013, NEDC sent a new sixty-day Notice of Intent to Sue enforcement action under the Clean Water Act- to Parkrose Auto Center, LLC, and its officers, and information received by NEDC Parkrose Auto Recycling, LLC, and Moyata Anotta. Subsequent the dismantling operation at the established Parkrose Auto Recycling, LLC, assumed control over Facility at some point on or around Apri119, 2013. While NEDC was aware control of the operation had changed hands , pursuant to the Clean not file an Amended Complaint Water Act's citizen suit provision, 33 U.S.C. § 1365(b), it could period ended on June 15, 2013. until sixty days after that notice letter was sent. The sixty-day notice factor weighs in favor of granting Under these circumstances there was no undue delay and this NEDC leave to amend its Complaint. B. Bad Faith Here, the initial and Amended Complaints have the same object ive: to ensure the facility in the control of the Facility was question comes into compliance with the Clean Water Act. That shifting from Parkrose Auto Center, LLC to Parkrose Auto Recyc ling, LLC around the time of the and was not provided to NEDC. As Complaint was infotmation exclusively in defendants' control, set forth above, NEDC became aware of the existence of the new corporate entity as it was finalizing new company and the Facili the original Complaint. At that time, the relationship between the 5 - OPINION AND ORDER ty was not clear. It was only after the Complaint was filed and a second Notice of Intent to Sue was sent that NEDC was able to understand the operations at the Facility changed hands. Based upon this information, NEDC intends to proceed with this enforcement action against all parties that have caused or contributed to the Clean Water Act violations at the site. There is no evidence in the record of bad faith or a dilatmy motive on NEDC's pmi. As such, this factor weighs in favor of granting NEDC leave to amend its Complaint. C. Prejudice There will be no undue prejudice ifNEDC is allowed to amend its Complaint to name two additional defendants. Particularly as neither the actors nor the alleged conduct in violation of the law have changed. Rather, the change is simply in the corporate entity and the individual taking the lead in operating the Facility. Arguably, it is defendants' actions that have necessitated an amendment. Moreover, the litigation is in the earliest stages and, in fact, several defendants have not yet filed an Answer. NEDC represents it has contacted some, but not all, of defendants in this case, and it is NEDC's understanding none of the defendants have retained counsel. In addition, neither of the two defendants who have appeared in this case filed an opposition to NEDC' s request for leave to amend. Under the circumstances, there is no prejudice to any defendant in this case. See Jackson v. Bank ofHawaii, 902 F.2d 1385, 1387 (9th Cir. 1990) (court finds prejudice based upon the nullification of prior discovery, the burden of necessary future discove1y, and the relitigation of a suit brought by its insurer regarding the liability of the two pmiies on appellants' claims). Accordingly, this factor weighs in favor of granting NEDC leave to amend its Complaint. See id. (prejudice to the opposing pmiy is the most important factor). 6 - OPINION AND ORDER D. Futility In the Ninth Circuit futility of an amendment alone will justifY the denial of a motion for leave to amend. Bonin v. Calderon, 59 F.3d 815, 845 (9th Cir. 1995); see also, Lopez v. Smith, 203 F.3d 1122, 1129-30 (9th Cir. 2000) (en bane) (confirming district comt's authority to dismiss without leave to amend where amendment would be futile). However, a proposed amendment is futile only if no set of facts can be proved under the amendment which would constitute a valid claim or defense. Miller v. Rykoff-Sexton, Inc., 845 F.2d 209,214 (9th Cir. 1988). In its First Amended Complaint, NEDC alleges three claims against the various individual defendants and their related entities under § 1311(a) of the Clean Water Act for discharge of pollutants without a permit. Sections 301(a) and 402 of the Clean Water Act, 33 U.S.C. §§ 13ll(a) and 1342, prohibit the discharge of pollutants, from a point source, into waters of the United States without a National Pollutant Discharge Elimination System ("NPDES") petmit or in violation of such a permit. Section 402(p)(3)(A) of the Clean Water Act specifically subjects the discharge of pollutants through st01mwater associated with industrial activities to the prohibition and petmitting requirements that apply to any other point source discharge of a pollutant. 33 U.S.C. § 1342(p)(3)(A). Federal and state regulations define "st01mwater" as "storm water runoff, snowmelt runoff, and surface runoff and drainage." 40 C.F.R. § 122.26(b)(l3); OR. ADMIN. R. 340-0450010(27). NEDC alleges all defendants: (1) are engaged in industrial activities for which the associated discharge ofstotmwater requires a NPDES petmit, see 40 C.F.R. § 122.26(b)(14); Exhibit 3, 1200-COLS NPDES Permit; (2) have discharged and continue to discharge stotmwater from a point source or point sources at an industrial facility into waters of the United States; and (3) do not have a NPDES permit for the discharge of stormwater from the facility. 7 - OPINION AND ORDER Based upon the allegations in the First Amended Complaint, accepted as true, NEDC has stated a plausible legal theoty that is not subject to dismissal at this juncture. As such, NEDC's proposed amendments are not futile, and this factor weighs in favor of granting NEDC leave to amend. Conclusion Based upon the foregoing, NEDC's Motion for Leave to File Plaintiffs First Amended Complaint (#11) is GRANTED. NEDC's First Amended Complaint must be filed within 14 days of this decision. IT IS SO ORDERED / c (_-K_,/ -~1/-I( JOHN V. ACOSTA Unit d States Magistrate Judge 8 - OPINION AND ORDER
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