White Plains Aviation Partners, LLC v. The County of Westchester

Background

White Plains Aviation Partners, LLC, doing business as Million Air White Plains, sued the County of Westchester under a 2016 lease. Million Air alleged that the County breached Section 6.2 by unreasonably refusing permission to construct a modified hangar. It also asserted claims involving the lease’s implied obligation of good faith and fair dealing.

The County moved to dismiss. On March 11, 2022, the court granted that motion in part and denied it in part. The court dismissed Million Air’s breach-of-contract and declaratory-relief claims based on Section 6.2, as well as some of its good-faith-and-fair-dealing claims. A claim concerning the County’s changed position about a stormwater system remained.

Afterward, Million Air submitted a new request to construct the modified hangar under Section 5.5 of the lease. The County responded with reasons for not approving the request, and Million Air said those reasons were unreasonable. Million Air then moved for leave to amend and supplement its complaint to remove the dismissed claims and add breach-of-contract and declaratory-relief claims under Section 5.5.

Legal standard

Under Rules 15(a)(2) and 15(d) of the Federal Rules of Civil Procedure, courts generally should allow amendments and supplemental pleadings when justice requires. Leave may be denied for reasons such as undue delay, bad faith, undue prejudice, or futility. An amendment is futile if the proposed claims would not survive a motion to dismiss.

Reasoning

The court found no undue delay. Although Million Air could have asserted the Section 5.5 claims earlier, it filed its motion before the scheduling-order deadline for amending pleadings. Also, when Million Air previously declined to amend, neither party had argued whether Section 5.5 applied to the modified-hangar request.

The court also found no undue prejudice to the County. Any additional discovery would concern the same lease and construction plans, and the discovery deadline was still several months away after being extended twice. The court therefore was not persuaded that the amendment would substantially increase the scope or cost of discovery.

The court rejected the County’s argument that the new claims were futile. The proposed complaint alleged that Million Air had submitted a Section 5.5 request, that the County responded within the lease’s forty-day period, and that the County effectively denied the request. Those allegations made the claims sufficiently immediate for review rather than hypothetical. The proposed complaint also alleged the elements of a breach-of-contract claim, including the lease, Million Air’s performance, the County’s failure to perform, and resulting customer losses. At the pleading stage, the court found that the allegations about the unreasonableness of the County’s stated reasons raised factual issues that could not be resolved on a motion to dismiss.

Rulings

The court granted Million Air’s request to remove the claims previously dismissed. It also granted the motion for leave to amend and supplement the complaint to add the Section 5.5 claims. The court denied the County’s request to stay discovery while awaiting an anticipated motion to dismiss, stating that such a motion would be frivolous and summarily denied because the proposed amended complaint stated claims for relief.

Million Air was ordered to file the proposed amended complaint as the operative complaint by October 11, 2022. The County’s answer was due October 25, 2022.