Delta Industrial Services, Inc. v. Kaman Automation, Inc.

Background

Delta Industrial Services, Inc. sued Kaman Automation, Inc. and Kollmorgen Corporation. Kollmorgen answered, and Kaman moved to dismiss. Delta then voluntarily dismissed Kaman from the action without prejudice under Federal Rule of Civil Procedure 41(a)(1)(A)(i).

Kollmorgen later sought to add Kaman as a third-party defendant. Delta consented through a stipulation. Kaman moved to strike the stipulation or, alternatively, to deny Kollmorgen permission to file its third-party complaint. Kaman argued that Federal Rule of Civil Procedure 14(a)(1) required Kollmorgen to seek permission through a motion because more than 14 days had passed after Kollmorgen served its answer.

Court’s Analysis

The court first held that there was no basis for Kaman’s motion to strike. Rule 12(f) permits striking certain material from a pleading, but the stipulation was not a pleading. The court also concluded that Kaman, which remained a non-party, could not invoke Rule 14(a)(4), which allows a party to move to strike a third-party claim. In addition, no third-party claim yet existed because Kollmorgen had not filed its third-party complaint.

The court nevertheless considered Kaman’s Rule 14 arguments and found them unpersuasive. Under Rule 14(a)(1), a party generally must obtain the court’s permission before filing a third-party complaint more than 14 days after serving its original answer. The court explained that it had discretion to allow the filing and that the standards for amending a pleading under Rule 15 were useful in making that decision. Rule 15 generally favors allowing amendments when justice requires, but leave may be denied for undue delay, bad faith, apparent futility, or unfair prejudice.

The court found no undue delay because the case was still at its beginning, Kollmorgen’s request came five weeks after entry of the scheduling order, and the request was timely under that order. It found no apparent bad faith or futility. The proposed complaint alleged that Kaman’s contractual relationship with Delta involved Kollmorgen products modified by Kaman, making Kaman potentially responsible for damages. The court also found no unfair prejudice because the relationships among Delta, Kollmorgen, and Kaman appeared interrelated and could be addressed in one proceeding. The possibility that Kaman might later seek arbitration did not, by itself, establish unfair prejudice.

Disposition

The court APPROVED the Stipulation to Add Third-Party Defendant and DENIED Non-Party Kaman Automation, Incorporated’s Motion to Strike Defendant Kollmorgen’s Stipulation or, Alternatively, to Deny Leave to File. The court ordered Kollmorgen to file its third-party complaint, substantially in the form attached to the stipulation, within seven days. Judge Steven E. Rau signed the order.