RocketFuel Blockchain Company v. Ellenoff Grossman & Schole LLP

Background

The plaintiffs filed the case on March 1, 2021, and filed an amended complaint on March 19, 2021, adding RocketFuel Blockchain, Inc. as a plaintiff. The defendant had not appeared or been served when the amended complaint was filed. Service was completed on April 1, 2021, by service on the Secretary of State of New York.

The plaintiffs asked the court to adjust the schedule because the initial pretrial conference was set for April 16, 2021, before the date by which the defendants would respond to the amended complaint. They also asked the court to confirm or authorize the addition of RocketFuel Blockchain, Inc. as a plaintiff. The plaintiffs argued that Rule 15 of the Federal Rules of Civil Procedure allowed the amendment without court permission because no responsive pleading had been filed.

Court’s Analysis

The court adjourned the initial pretrial conference to April 23, 2021, at 11:30 a.m. The parties’ joint letter and proposed case-management plan were due by April 15, 2021. The court noted that its earlier scheduling order had stated that requests to adjourn the conference would not necessarily be granted because a defendant had not been served or had not answered. The court warned plaintiffs’ counsel to read its orders closely before making requests.

The court held that, in the Southern District of New York, Rule 21 also applies when an amended complaint adds a party, even if Rule 15(a)(1) allowed the plaintiffs to file an amended complaint as of right. Rule 21 permits a court to add or remove a party on just terms. The court explained that the standard under Rules 15 and 21 is lenient and that the defendant had not yet been served when the amendment was filed.

Ruling

Judge Valerie Caproni granted the plaintiffs’ request, effective retroactively to March 19, 2021, to add RocketFuel Blockchain, Inc. as a plaintiff. The opinion does not decide the merits of the underlying dispute.