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44 55 66 77 88 UNITED STATES DISTRICT COURT 99 CENTRAL DISTRICT OF CALIFORNIA 1100 1111 SYED HABEEB PASHA, Case No. 2:19-cv-05672-ODW(AGR) Hon. Otis D. Wright II 1122 Plaintiff, ORDER DENYING PLAINTIFF’S 1133 MOTION FOR LEAVE TO FILE A SECOND AMENDED COMPLAINT 1144 v. [19] and DENYING PLAINTIFF’S EX PARTE APPLICATION [21] 1155 THOMAS VISCOSI, an individual; SHELLY BERENSEN, an individual; et 1166 al. 1177 Defendants. 1188 1199 2200 2211 2222 2233 2244 I. INTRODUCTION 2255 Plaintiff Syed Habeeb Pasha (“Pasha”) moves for leave to file a Second Amended 2266 Complaint (“SAC”) (“Motion”). (Mot. for Leave to File SAC (“Mot.”) 1, ECF 2277 No. 19.) Subsequent to filing his Motion, Pasha applied ex parte to either advance the 2288 hearing on his Motion so that it would be timely or modify the Scheduling Order to 1 allow additional time for parties to amend pleadings (“Ex Parte”). (Ex Parte Appl. 2 (“Ex Parte”) 1, ECF No. 21.) For the following reasons, the Court DENIES Pasha’s 3 Motion and Ex Parte.1 4 II. FACTUAL BACKGROUND 5 On January 15, 2019, Pasha filed this action against Defendants Thomas 6 Viscosi, Shelly Berensen (“Individual Defendants”), as well as a number of foreign 7 companies, in the Superior Court of California, County of Los Angeles. (Notice of 8 Removal, Ex. 1 (“Compl.”), ECF No. 1-1.) Pasha asserted claims for Fraud, Money 9 Had and Received, Offer and Sale of Unqualified Non-exempt Securities, and 10 Misrepresentation or Omission of Material Facts in Violation of California 11 Corporations Code section 25401 against all Defendants and Breach of Contract 12 against the Individual Defendants. (Compl. ¶¶ 20–52.) Pasha subsequently amended 13 his complaint only to modify the amount of monetary damages sought. (Notice of 14 Removal, Ex. 1 (“First Am. Compl.” (“FAC”) at 10, ECF No. 1-1.) Defendants 15 removed the action to this Court on June 28, 2019. (See Notice of Removal, ECF 16 No. 1-1.) 17 Pasha’s Motion asserts that he “recently discovered” that $100,000 of the funds 18 at issue were transferred via Domestic Money Transfer (“DMT”) from Pasha’s 19 account to Specialized Processing Solutions LLC (“SPS”). (Mot. 5; Decl. Eugene S. 20 Alkana (“Alkana Decl.”) ¶ 8, Ex. A (“Proposed SAC”), Ex. B (“DMT receipt”), ECF 21 No. 19.) Pasha asserts that Berensen is a managing member of SPS. (Mot. 5.) 22 After failing to reach a stipulation with Defendants to allow amendment, on 23 November 27, 2019, Pasha moved for leave to file a SAC adding SPS as a Defendant 24 to the Third Cause of Action (Money Had and Received). (Alkana Decl. ¶ 9.) Pasha 25 set the hearing for December 30, 2019, seven days after the deadline for hearings to 26 amend pleadings or add parties. (Scheduling and Case Management Order 27

28 1 After considering the papers filed in connection with Motion, the Court deemed the matter appropriate for decision without argument. Fed. R. Civ. P. 78(b); C.D. Cal. L.R. 7-15. 1 (“Scheduling Order”) 25, ECF No. 14.) After Defendants opposed based in part on 2 the Motion’s untimeliness, Pasha applied ex parte to either advance the hearing so that 3 the Motion would be timely or modify the Scheduling Order to extend the time to 4 amend pleadings. (Ex Parte 1.) Defendants oppose both Pasha’s Motion and Ex 5 Parte. (Opp’n to Mot. (“Opp’n”), ECF No. 20, Opp’n to Ex Parte, ECF No. 31.) 6 III. LEGAL STANDARD 7 “[W]hen a party seeks to amend a pleading after the pretrial scheduling order’s 8 deadline for amending the pleadings has expired, the moving party must satisfy the 9 ‘good cause’ standard of Federal Rule of Civil Procedure 16(b)(4) [(“Rule 16”)].” In 10 re W. States Wholesale Nat. Gas Antitrust Litig.,

(9th Cir. 2013). 11 Rule 16 provides that “[a] schedule may be modified only for good cause and with the 12 judge’s consent.” Fed. R. Civ. P. 16(b)(4). When seeking to modify the Scheduling 13 Order for leave to amend, only where the moving party first satisfies Rule 16’s good 14 cause standard will the Court consider whether amendment is proper under Federal 15 Rule of Civil Procedure 15(a)(2) (“Rule 15”). Johnson v. Mammoth Recreations, Inc., 16

(9th Cir. 1992). 17 Unlike Rule 15’s liberal amendment policy, which provides that leave to amend 18 “should [be] freely give[n] when justice so requires,” “Rule 16(b)’s ‘good cause’ 19 standard primarily considers the diligence of the party seeking the amendment.” Fed. 20 R. Civ. P. 15(a)(2); see Jackson v. Bank of Hawaii,

(9th Cir. 21 1990); Johnson,

. “The district court may modify the pretrial schedule 22 ‘if it cannot reasonably be met despite the diligence of the party seeking the 23 extension.’” Johnson,

. “Although the existence or degree of 24 prejudice to the party opposing the modification might supply additional reasons to 25 deny a motion, the focus of the inquiry is upon the moving party’s reasons for seeking 26 modification. If that party was not diligent, the inquiry should end.”

(citation 27 omitted); see In re W. States, 715 F.3d at 737–38 (“The good cause standard typically 28 will not be met where the party seeking to modify the scheduling order has been 1 aware of the facts and theories supporting amendment since the inception of the 2 action.”). 3 If the moving party satisfies Rule 16’s good cause standard, the court may then 4 consider whether amendment is proper under Rule 15. Johnson,

. 5 While Rule 15 provides that leave to amend shall be given freely, it is not automatic. 6 See Jackson,

. In determining whether to grant leave to amend, 7 courts in the Ninth Circuit consider five factors: “(1) bad faith, (2) undue delay, 8 (3) prejudice to the opposing party, (4) futility of amendment, and (5) whether 9 plaintiff has previously amended his complaint.” In re W. States,

. 10 However, “[n]ot all of the factors merit equal weight.” Eminence Capital, LLC v. 11 Aspen, Inc.,

(9th Cir. 2003). “[P]rejudice to the opposing 12 party . . . carries the greatest weight.”

13 IV. DISCUSSION 14 Pasha moves for leave to file a SAC to name SPS as a Defendant based on the 15 “recently discovered” DMT receipt. (Mot. 5–6.) Defendants oppose, arguing that the 16 sole piece of evidence supporting amendment, the DMT receipt, has been available to 17 Pasha since 2014. (Opp’n 3.) Defendants also oppose on the basis that Pasha’s 18 motion is untimely. (Opp’n 3.) 19 A. Ex Parte Application 20 Apparently in response to Defendants’ opposition, Pasha applies ex parte to 21 either advance the hearing on his motion to make it timely, or modify the Scheduling 22 Order to extend the deadline to amend pleadings or add parties. (Ex Parte 1.) 23 Defendants oppose Pasha’s ex parte application. (See Opp’n to Ex Parte.) 24 A party seeking ex parte relief must establish why a motion cannot be 25 calendared in a regular manner; that they will be irreparably prejudiced if the motion 26 is heard in accord with regular procedures; and that the requesting party is without 27 fault in creating the crisis that requires ex parte relief or that the crisis was due to 28 excusable neglect. Mission Power Eng’g Co. v. Cont’l Cas. Co.,

, 1 492 (C.D. Cal. 1995). “Ex parte applications are not intended to save the day for 2 parties who have failed to present requests when they should have . . . .” In re 3 Intermagnetics Am., Inc.,

(C.D. Cal 1989). 4 Pasha fails to address Mission Power in his Ex Parte. (See generally Ex Parte.) 5 Additionally, Pasha appears to have resorted to ex parte practice as a result of missing 6 the deadline to file a regularly noticed motion. Pasha fails to show how this “crisis” is 7 not of his own making or present good cause for having missed the deadline. He 8 claims “recent discovery” revealed the transaction to SPS, but the DMT receipt is 9 dated 2014 and is from Pasha’s account, so he has, or could have, been aware of the 10 transaction with SPS since before the inception of this action. (See DMT receipt.) 11 Further, the Court issued the Scheduling Order in September 2019, giving Pasha 12 ample time to move to amend before the deadline. (See Scheduling Order.) 13 Therefore, the Court’s DENIES Pasha’s Ex Parte. (ECF No. 21.) 14 B. Motion for Leave to File SAC 15 Turning to Pasha’s Motion, the Scheduling Order provides that any party 16 moving for leave to amend a pleading after the deadline must address the propriety of 17 the amendment under Johnson v. Mammoth Recreations, Inc. (Scheduling Order 5.) 18 Johnson provides that the good cause standard under Rule 16 “primarily considers the 19 diligence of the party seeking the amendment.”

. If the Scheduling 20 Order cannot reasonably be met despite the diligence of the party seeking extension, 21 the court may permit modification.

22 Pasha filed his Motion on November 27, 2019, which necessitated a hearing 23 date no sooner than December 30, 2019 per the local rules. (Mot. 1); C.D. Cal. 24 L.R. 6-1. However, to be timely per the Scheduling Order, the Motion needed to be 25 heard by December 23, 2019. (Scheduling Order 5.) Thus, as Pasha filed the Motion 26 after the deadline, he must first show good cause to modify the Scheduling Order 27 before he may seek leave to amend the FAC. 28 1 Pasha moves to amend to add SPS as a Defendant based on “recently 2 discovered” evidence that Defendant Berensen is a managing member of SPS and that 3 “at least some of” the funds at issue were transferred to SPS on July 16, 2014. 4 (Mot. 5–6; DMT receipt.) However, Pasha provides no explanation for the “recent[] 5 discover[y],” such as when he learned of the transaction, why he could not have 6 discovered it previously, or how he could have been unaware of the transaction 7 involving his own bank account for nearly five and a half years. (See generally Mot.) 8 Defendants, on the other hand, suggest that not only was this information available to 9 Pasha since before he commenced this litigation, but that Pasha had knowledge of the 10 transaction since 2014. (Opp’n 3.) Indeed, the DMT receipt shows a monetary 11 transfer from Pasha’s account to SPS on July 16, 2014. (DMT receipt.) Yet, Pasha 12 offers no evidence or argument that this DMT receipt was withheld from, unavailable 13 to, or in some other way kept from him. These facts do not indicate diligence or good 14 cause. See In re W. States, 715 F.3d at 737–38 (“The good cause standard typically 15 will not be met where the party seeking to modify the scheduling order has been 16 aware of the facts and theories supporting amendment since the inception of the 17 action.”). 18 Despite Pasha’s arguments that he promptly sought to amend after “recently 19 discover[ing]” the SPS transaction, the DMT receipt indicates he had this information, 20 or access to it, since before filing suit, and Pasha does nothing to explain or refute this 21 fact. As such, Pasha had ample opportunity to add SPS as a Defendant before the 22 deadline to amend or add parties. Therefore, the Court does not find good cause to 23 modify the Scheduling Order. Accordingly, Pasha’s Motion is DENIED. 24 Even if the Court found good cause for modifying the Scheduling Order, which 25 it does not, Pasha’s Motion does not pass muster under Rule 15. While Rule 15(a)(2) 26 provides that leave to amend “should [be] freely give[n] when justice so requires,” it 27 “is not to be granted automatically.” Fed. R. Civ. P. 15(a)(2); Jackson,

1387. The Ninth Circuit considers bad faith, undue delay, prejudice to the opposing 1 || party, futility of amendment, and whether plaintiff has previously amended the 2 | complaint. In re W. States,

. Here, undue delay is of primary concern, 3 || although other factors also weigh against allowing amendment. 4 Pasha contends that there is no undue delay because he timely sought leave to 5 || amend to add SPS following his “recent[] discover[y]” of Berensen’s role with SPS 6 || and the DMT transaction. (Mot.5.) However, regardless of opposing counsel’s 7 || alleged delays in the meet and confer process, Pasha appears to have had access to, or 8 | been in possession of, the relevant information for more than five years. (See DMT 9 || receipt.) As discussed above, Pasha offers no evidence or argument as to how or 10 || when this information came to light beyond “recently,” nor does he explain why he 11 | could not have discovered it from his own bank records before now. Absent such an 12 || explanation, the Court finds Pasha’s last-minute attempt to add SPS as a Defendant 13 || constitutes undue delay. 14 As the reasons discussed above are dispositive of Pasha’s Motion, the Court 15 || does not reach the parties’ remaining arguments. 16 Vv. CONCLUSION 17 For the reasons discussed above, the Court DENIES Pasha’s Ex Parte 18 | Application (ECF No. 21) and Motion for Leave to File a SAC (ECF No. 19). 19 20 IT IS SO ORDERED. 21 22 February 5, 2020 23 . ff 24 Geli 95 OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE

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