Lalli v. Warner Bros. Discovery, Inc.

Background

Elle Lalli moved under Federal Rule of Civil Procedure 15(a)(2) for permission to file a First Amended Complaint. Her original complaint contained 16 counts. The proposed amendment would add Count 17, alleging violations of Sections 502(a)(1)(B) and 502(a)(3) of the Employee Retirement Income Security Act (ERISA), and would add the Warmer Media, LLC U.S. Severance Plan as a defendant. The opinion describes that entity as the plan administrator and later refers to it as “Warner Media.”

Lalli’s proposed ERISA claim followed the alleged denial of her severance-benefit appeal on June 27, 2024. The opinion states that she filed the amendment motion less than three months later.

Arguments and Analysis

Rule 15(a)(2) generally provides that permission to amend a complaint should be freely given when justice requires. The court explained that amendment may be denied for reasons such as undue delay, bad faith, undue prejudice, or futility, meaning that the proposed amendment could not succeed even if its allegations were accepted.

Warner Bros. Discovery did not identify undue delay or improper delay tactics. It argued that it would have to rebrief its pending motion to dismiss the first 16 counts, but the court found that the amendment did not change the allegations supporting those counts. The court also found no undue prejudice, explaining that the additional time, effort, or expense of litigation was not enough to justify denying amendment.

Warner Bros. Discovery also argued that amendment would be futile because Lalli had not executed a release of other claims that, according to the defendant, was a condition of receiving severance benefits. Lalli responded that the defendant had attached the wrong severance plan and that her Section 502(a)(3) theory concerned an alleged misrepresentation about the plan benefit. The court stated that the defendant could address the ERISA claim’s viability in a renewed motion to dismiss, including whether satisfying the alleged condition was an element that Lalli had to plead. The court held that the alleged pleading defect was not, at that stage, a reason to deny amendment.

Ruling and Effect

The court granted Lalli’s motion to amend. It ordered that the First Amended Complaint be filed no later than October 25, 2024. Both defendants were ordered to respond 21 days after the later of service on Warner Bros. Discovery under Rule 5 or service on the added defendant under Rule 4.

The court stated that the defendants could rely on the arguments in their existing motion-to-dismiss memorandum concerning the first 16 counts. The court denied the pending motion to dismiss, Docket No. 9, as moot because the amended complaint would be filed. The Clerk was directed to close the motions at Docket Nos. 9 and 31. The opinion did not decide the merits of Lalli’s ERISA claims or the defendant’s release argument.