UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

} MARTHA WRIGHT, et al. } } Plaintiffs, } } v. } Case No. l:OO-cv-00293(GK} } CORRECTIONS CORPORATION OF } AMERICA, et al., } } Defendants. } ~~~~~~~~~~~~~~~~>

MEMORANDUM OPINION

On May 15, 2015, Plaintiffs filed a Motion for Leave to File

a First Amended Class Action Complaint ("Motion") [Dkt. No. 178] .

They seek to reduce their original 12 counts to three while greatly

expanding the scope of the proposed class, as well as to update

the Complaint to reflect changes to the Parties' situations over

the last fifteen years. Defendants Securus Technologies, Inc.

( "Securus") and Corrections Corporation of America ( "CCA") have

filed responses in opposition to Plaintiffs' Motion [Dkt. Nos. 180,

181], and Plaintiffs have filed a Reply [Dkt. No. 184]. Upon full

consideration of all the pleadings and the entire record herein,

the Motion shall be granted for the following reasons.

I . BACKGROUND

On February 16, 2000, Plaintiffs filed this putative class

action on behalf of inmates incarcerated at prison facilities owned

-1- and operated by Corrections Corporation of America, as well as on

behalf of family members and friends of the inmates.

In August 2001, the Court ruled that the Federal Communication

Commission ("FCC") was "in the best position to resolve the core

issues in this case, namely the reasonableness of the rates charged

and the feasibility of alternative telephone arrangements in CCA

facilities." Memorandum Opinion at 10-11 [Dkt. No. 94] . On

November 5, 2001, the Court entered an Order staying the case [Dkt.

No. 105].

Since then, Plaintiffs have filed two petitions for rulemaking

with the FCC. On September 26, 2013, the FCC issued its Report and

Order and Further Notice of Proposed Rulemaking ("Inmate Rate

Order") . Rates for Interstate Inmate Calling Services, 7

(Nov. 13, 2013) (to be codified at 47 C.F.R. pt. 64).

On November 14, 2013, Securus, a Defendant in this lawsuit

under its former name Evercom, and others filed Petitions for

Review of the FCC's Inmate Rate Order with the United States Court

of Appeals for the District of Columbia. Securus Tech., Inc. v.

FCC, 13-1280 (D.C. Cir. filed Nov. 14, 2013). In response to the

FCC's uncontested motion to hold the case in abeyance pending the

agency's adoption of permanent inmate calling reforms, the Court

of Appeals stayed the appeal on December 16, 2014. See Securus,

13-1280 [Dkt. Nos. 1526582, 1527663]; see also Rates for Interstate

-2- Inmate Calling Services, Second Further Notice of Proposed

Rulemaking, 29 FCC Red 13170,

.

On October 27, 2014, Plaintiffs filed a Motion to Reopen and

Lift Stay Temporarily [Dkt. No. 139]. On February 13, 2015, while

the Motion to Reopen was pending, Plaintiffs also filed a Motion

to Transfer the case to the Western District of Arkansas [Dkt.

No. 163], which Defendants opposed [Dkt. Nos. 165, 166, 167]. The

Court granted Plaintiffs' Motion to Reopen on April 30, 2015 [Dkt.

No. 177]. On May 15, 2015, Plaintiffs filed the present Motion for

Leave to File an Amended Complaint. See Motion at 1; First Amended

Class Action Complaint ("First Amended Class Action Complaint;' or

"Am. Compl.") [Dkt. No. 178-2]. On May 18, 2015, the Court denied

Plaintiffs' Motion to Transfer [Dkt. No. 179].

II. STANDARD OF REVIEW

A. Leave to Amend

The amendment of pleadings in civil matters is governed by

Rule 15 of the Federal Rules of Civil Procedure, which states that

the "court should freely give leave [to amend] when justice so

requires." Fed. R. Civ. P. 15(a) (2). The decision to grant or deny

leave to amend rests in the sound discretion of the trial court;

however, it is an abuse of discretion to deny leave without a

sufficient justification for doing so. Firestone v. Firestone,

(D.C. Cir. 1996) (citing Foman v. Davis,

(1962)). Sufficient justifications include "undue delay,

-3- bad faith or dilatory motive repeated failure to cure

deficiencies by [previous] amendments [or] futility of

amendment."

(quoting Foman,

).

In assessing a motion for leave to amend, the Court is

required to assume the truth of the allegations in the amended

complaint and construe them in the light most favorable to the

movant. Caribbean Broadcasting Sys.,

(D.C.

Cir. 1998). The party opposing the amendment bears the' burden to I

-I show why leave should not be granted. Dove v. Washington Metro.

Area Trans. Auth.,

(D.D.C. 2004) (citing

Gudavich v. Dist. of Columbia, 22 F. App' x 17, 18 (D. C. Cir.

2001)).

Defendants oppose Plaintiffs' Motion and contend that it

should be denied because (1) the proposed amendments are improper

and beyond the scope of the initial Complaint, ( 2) Plaintiffs

unduly delayed in seeking to amend their Complaint, ( 3) the

proposed amendments are unduly prejudicial to Defendants, (4) the

proposed amendments are brought in bad faith, and (5) the proposed

amendments are futile. The Court will address each argument in

turn.

Plaintiffs' original Complaint focused on obtaining damages

for those who initiated telephone calls to people in correctional

institutions operated by CCA, and all prisoners incarcerated in

-4- correctional institutions operated by CCA [Dkt. 1, ~ 34]. It reads

as follows:

Class (1): Families, Friends, Lawyers and Other Bill Payer Plaintiffs, defined as all persons, corporations and organizations billed for telephone calls initiated by people who presently are, have been or will be confined to a correctional facility operated by CCA.

as well as

Class (2): Prisoner Plaintiffs, defined as all persons who presently are, have been, or will be incarcerated in correctional institutions operated by CCA.

Plaintiffs' First Amended Class Action Complaint contained

the allegations set forth above and ~ 50, which included all

persons using Securus telephone systems at non-CCA facilities. It

reads as follows [Dkt. No. 178-2]:

all persons in the United States who, at any time since February 16, 1998, have paid to use telephone systems provided by Securus at a CCA facility or who, at any time since May 15, 2013, have paid to use telephone systems provided by Securus at a non-CCA facility, in order to make or receive telephone calls involving a person incarcerated in any state in the United States (the "Class") .

as well as

all persons who, at any time since February 16, 1997, have paid to use telephone systems at a CCA facility in order to make or receive telephone calls involving a person incarcerated in any state in the United States (the "Class").

-5- II. DISCUSSION

A. The Proposed Amendments Do Not Improperly Expand the Scope of the Original Complaint

A key issue to decide in any Motion to Amend is whether

Plaintiffs have improperly expanded the scope of the original

Complaint.

Securus argues that leave to amend should not be granted

"where the proposed amendments would expand the scope of the

existing claims." Securus Opp'n at 5 (citing Lover v. District of

Columbia,

(D.D.C. 2008). This is far too broad

a reading of Lover.

That case does not prevent amendment of a complaint whenever

the scope of the original claims is expanded. Rather, Lover

acknowledges that an amendment "may unduly prejudice a defendant

if [the] amendment would delay litigation or 'expand[] the

allegations beyond the scope of the initial complaint.'" Lover,

(emphasis added) (quoting Parish v. Frazier,

(5th Cir. 1999)). "Prejudice is likely if 'the

amended complaint contain[s] new complex and serious charges which

would undoubt [edly] require additional discovery for the

defendants to rebut.'"

(quoting Ferguson v. Roberts,

(7th Cir. 1993)).

-6- Securus argues strongly that Plaintiffs are trying to

improperly expand the class. The initial Complaint, as it

pertained to Securus, was limited to those CCA facilities to which

Securus provided ICS. The new Complaint expands the scope to all

correctional facilities in the country served by Securus. While

Securus is correct that the First Amended Complaint does greatly1

increase the proposed class size, a mere .increase in class size is

neither complex nor inherently prejudicial.

Securus alleges that Plaintiffs are trying to reach back to

1998 for creation of the expanded class and that the proposed

amendment expands the case so significantly as to be prejudicial

to Defendants. Securus Opp'n at 9. Securus is clearly incorrect

about Plaintiffs' attempts to reach back. The Complaint

specifically limits damages for the expanded class to May 15, 2013

and onward. See Am. Compl. ~ 49.

Otherwise, Securus offers little in the way of explaining

what prejudice it would suffer from the expanded class, other than

the magnitude of the expansion. Given the fact that the expanded

class is limited to the two-year statute of limitations, Plaintiffs

have gained no unfair advantage from the stay. That Plaintiffs

1 The First Amended Complaint does not provide an exact figure as to the number of correctional facilities it encompasses, but does allege that Securus has had exclusive contracts with "thousands of correctional facilities." Am. Compl. ~ 21. -7- could have merely filed a separate case at the time of the Motion

on behalf of an expanded class supports this conclusion.

Nor does the expanded class introduce "new complex and serious

charges" or delay the litigation. In Lover, the proposed amendment

would have further delayed the completion of discovery and the

resolution of the case. That is not the situation here. The'case,

though stayed for many years, is still in the very early stages of

litigation and discovery has barely begun, if at all.

Securus also contends that Plaintiffs want to expand the scope

by "add[ing] the vague category of 'fees' to the claim." Securus

Opp'n at 5. This argument overlooks the fact that Plaintiffs did

in fact allege improper fees in the original Complaint. See, ~,

Complaint ~ 37 (question of "whether the fees imposed by the

defendants represent a fair market value for the services or the

exploitation of an illegal monopoly"); Id. at 75 (describing rates

and surcharges as "a regulatory fee that bears no relation to the

actual administrative and enforcements costs incurred"). Though

fee allegations are more prominent in the First Amended Complaint,

they are not "new complex and serious charges," Lover,

(quoting Ferguson,

).

B. Amendment Would Not Cause Undue Delay

As already noted, while leave to amend a complaint is left to

the discretion of the court, it is an abuse of that discretion to

deny leave to amend unless there is sufficient reason, such as

-8- "undue delay, bad faith or dilatory motive ... repeated failure to

cure deficiencies by [previous] amendments ... [or] futility of

amendment." Firestone,

(quoting Foman,

) .

Defendant CCA argues that Plaintiffs unduly delayed seeking

to amend their Complaint and "should not have waited 13 years."

CCA Opp'n at 6. CCA contends that it is no excuse that the case

was and remains stayed and then referred to the FCC.

The Court

disagrees. It was entirely reasonable for Plaintiffs to wait to

amend their Complaint until the FCC acted upon their rulemaking

petitions, particularly in light of this Court's primary

jurisdiction ruling. See Memorandum Opinion [Dkt. No. 94].

Significantly, Defendants have not suggested a more appropriate

window of time in which Plaintiffs should have sought to amend

their Complaint nor did Defendants file any motions to dismiss the

Complaint. While thirteen years is obviously a long time, the

timing of the Motion is through no fault or delay by the Plaintiffs.

CCA further argues that, at the very least, the 13 months

that elapsed between the FCC's Inmate Rate Order and Plaintiffs'

Motion constitutes undue delay. CCA Opp' n at 7. CCA does not

explain why the Inmate Rate Order triggered an obligation for

Plaintiffs to immediately file their amended Complaint.

In fact, Defendant Securus tellingly takes the opposite

position from CCA, arguing that Plaintiff's Motion is premature

-9- because the FCC's Inmate Rate Order, on which the First Amended

Complaint relies in part, is currently on appeal to the D. C.

Circuit (and was stayed on December 16, 2014). See Securus Opp'n

at 17-19. By definition, Plaintiffs' Motion cannot be both

dilatory and premature.

Plaintiffs have consistently pursued their case before this

Court and the FCC. Plaintiffs were under no obligation to file

their First Amended Complaint within a certain period of time after

issuance of the Inmate Rate Order, and Defendants have not shown

now they have suffered any prejudice from the passage of those

thirteen months. As our court of Appeals noted in Caribbean

Broadcasting,

,"the prolonged nature of a case

does not itself affect whether the plaintiff may amend its

complaint."

Nor is Plaintiffs' Motion premature. The fact that the Inmate

Rate Order, as already noted, is currently on appeal and stayed at

the request of the FCC, does not prevent Plaintiffs from amending

their Complaint at this time. Even though it is possible that this

case cannot be fully resolved until the appeal of the Inmate Rate

Order is resolved, Securus fails to explain why this prevents

Plaintiffs from amending their Complaint. Securus claims that

"[a]llowing Plaintiffs to reopen this case now only invites waste

and expense," Securus Opp'n at 18, but gives no specifics as to

what they would be. Moreover, Plaintiffs are not seeking to lift

-10- the stay entirely; it has only been lifted temporarily in order to

seek the filing of their amendment of their Complaint.

CCA also argues that Plaintiffs abandoned their claim for

damages 13 years ago, when Plaintiffs sought only injunctive relief

from the FCC and did not submit complaints to the Enforcement

Bureau. 2 See CCA Opp'n at 6. CCA also argues that Plaintiffs'

failure to file a formal enforcement claim with the Enforcement

Bureau is indicative of undue delay. CCA points to Plaintiffs'

Third Report to the Court [Dkt. No. 132] ("Third Report"),

submitted on February 24, 2004, in which Plaintiffs expressed their

intention to bifurcate their claim. Plaintiffs stated that they

would file a formal complaint with the FCC's Enforcement Bureau,

"limited to claims regarding unreasonable inmate calling rates and

unlawful rebates." They also planned to file a separate petition

with the FCC's Wireline Competition Bureau challenging exclusive

dealing arrangements between prisons and res providers, and the

practice of providing only collect calling services without the

option of using debit and calling services. Third Report at 2.

Moreover, an enforcement claim is not a prerequisite to

seeking damages and CCA fails to cite any case law indicating that

2 CCA is incorrect to characterize this case as "always about injunctive relief, not damages," from its inception. CCA Opp'n at 6 n.1. Plaintiffs clearly sought damages in their original Complaint, see Compl. at 51. CCA argues that Plaintiffs abandoned their damages claim, which obviously supports Plaintiffs' answer that they did in fact seek such changes. -11- a formal complaint with the Enforcement Bureau is a prerequisite

to filing a damages claim. In addition, as Plaintiffs note, class-

wide relief is unavailable before the Enforcement Bureau and

therefore an enforcement action would not have resolved Plaintiffs'

class damages claims. See Pls.' Reply at 8.

For these reasons, the Court finds that Plaintiffs did not

unduly delay in filing their First Amended Complaint.

C. The Proposed Amendments Are Not Unduly Prejudicial to Defendants

Defendants next argue that allowing Plaintiffs to amend their

Complaint would result in prejudice to them. To determine if the

threat of prejudice to the opposing party is great enough to

warrant denying leave to amend, courts consider "the hardship to

the moving party if leave to amend is denied, the reasons for the

moving party failing to include the material to be added in the

original pleading, and the injustice resulting to the party

opposing the motion should it be granted." Childers v. Mineta,

(D.D.C. 2001) (quoting 6 Charles Alan Wright, Arthur

R. Miller & Mary Kay Kane, Federal Practice & Procedure, § 1487 at

621, 623 (3d ed. 2001)).

CCA contends, as it did in its undue delay argument, that it

will suffer prejudice because Plaintiffs deprived the parties of

the opportunity to resolve damages in a timely manner when they

did not file a formal complaint for damages with the Enforcement

-12- Bureau. CCA Opp'n at 8. As discussed above, Plaintiffs were not

required to seek damages before the Enforcement Bureau as a

prerequisite to seeking damages in this case. See supra, 7-8. In

addition, since Plaintiffs requested damages in their original

Complaint, Defendants were on notice of the claim. Thus, Defendants

have shown no resulting prejudice.

CCA alleges that Plaintiffs "are trying to reach back to

February 16, 1997, for damages that include the entire 13-year

period of the stay." CCA Opp'n at 8. Again, Plaintiffs' original

Complaint already included requests for damages and the expanded

class is limited to the two-year statute of limitations. Defendants

are not prejudiced by Plaintiffs seeking damages. Defendants have

been on notice of the potential for damages since the first

Complaint was filed. Whether damages--for the entire period of the

stay, a shorter time period, or any at all--are appropriate will

be decided at a later time and are not cause for denial of

Plaintiffs' Motion to Amend.

CCA' s next argument is that Defendants will be prejudiced

because the evidence has grown stale and witnesses have

disappeared. See CCA Opp'n at 8. The evidence issue exists

regardless of whether Plaintiffs amend their Complaint or not.

Similarly, CCA argues that it will be prejudiced in its

ability to discover evidence and prepare its defense. Id. at 8-9.

CCA contends that it is not an ICS provider and does not keep or

-13- maintain billing records that might show who accepted and received

ICS calls, or if the charges were actually paid by Plaintiffs. Id.

Again, this is not a problem that is unique to the First Amended

Complaint; CCA will face these issues under the current Complaint.

Securus argues that Plaintiffs are seeking "to transform their

case into something entirely new" through the proposed amendments.

Securus Opp'n at 9 (quoting Mississippi Ass'n of Cooperatives v.

Farmers Home Admin.,

(D.D.C. 1991)). Securus

cites to several cases in which amendment was denied. In those

cases, the proposed amendments were unrelated or only tangentially

related to the original case. Id. at 9-10; see e.g., Mississippi

Ass'n of Cooperatives,

(denying leave to amend

FOIA complaint against former federal agency to the extent

plaintiff sought to include race discrimination claims and

violations of the Administrative Procedure Act). Plaintiffs'

proposed amendments here are more than tangentially related to the

original Complaint and are readily distinguishable from the cases

cited by Securus.

For all the reasons discussed above, the Court finds that

Defendants will not be prejudiced by the proposed amendments to

the Complaint.

-14- D. Plaintiffs Proposed Amendments Were Not Brought In Bad Faith

Securus contends that Plaintiffs'. Motion should be denied

because it is not brought in good faith. Securus argues that

Plaintiffs' Motion exhibits bad faith because: (1) it is an attempt •: to obtain rehearing of the denial of Plaintiffs' Motion to

Transfer; and (2) the Motion's goal is to assist the Mojica case

in Arkansas rather than seek relief from this Court. Securus Opp'n

at 6-7.

Securus's first contention is easily disposed of, as

Plaintiffs' Motion was filed before the Court denied Plaintiffs'

Motion to Transfer. Therefore it cannot be "an attempt to re-

litigate the issue of transfer and circumvent the Court's May 18

decision," as the First Amended Complaint was filed on May 15,

2015. See Securus Opp'n at 6.

Second, Securus contends that Plaintiffs' cooperation with

Arkansas counsel for Mojica, and the similarities between the

complaints in both cases, is evidence of bad faith. Id. at 7-8.

There is absolutely nothing to support this claim. Cooperation

among attorneys with similar cases and aspirations of transferring

a case are relatively commonplace and the Court does not find them

to be indicative of bad faith.

-15- E. The Proposed Amendments Are Not Futile.

Securus argues first that Plaintiffs' proposed amendments are

futile because the proposed amendments will not cure the

circumstances which caused this Court to deny Plaintiffs' Motion

for Transfer to the Western District of Arkansas. Id. at 11.

Without predicting the merits of future motions to transfer,

whether or not the case becomes transferable has no bearing on the

futility of the case. Securus's argument says nothing about the

case's ability to proceed in this Court, and therefore is ·i' irrelevant to futility.

Next, Securus argues that the six "Inmate" Plaintiffs in the

First Amended Complaint lack standing to lodge the rate claim

against Securus. See Securus Opp'n at 11. Securus does not allege

that all Plaintiffs lack standing, only a subset of them. The First

Amended Complaint does not become futile because some Plaintiffs

lack standing, so long as the remaining Plaintiffs have it.

Therefore, even if Securus was correct that the Inmate Plaintiffs

lack standing, others do have standing, which means that the

Amended Complaint is not futile.

Securus also argues that the "Bill Payer" Plaintiffs did not

receive calls from non-CCA facilities, and therefore they cannot

support the newly expanded rate claim as it pertains to non-CCA

facilities. See Securus Opp'n at 13. Securus fails to explain why

this results in the Bill Payers lacking standing or why it renders

-16- the First Amended Complaint futile. Id. Plaintiffs are correct

that this issue is more pertinent to class certification and the

class representatives' ability to represent the broader class,

rather than standing. Pls.' Reply at 12.

Securus next argues that Plaintiffs' claims regarding non-CCA

facilities are time-barred. See Securus Opp' n at 13. Securus

contends that Plaintiffs cannot relate their non-CCA facility

claims back to 2000. Plaintiffs do not seek to do so. Because

I .i Plaintiffs limit these claims to the 2-year statute of limitations

period, which Securus acknowledges, Securus's time-barred

arguments fail. See Am. Compl. ~ 49 (limiting non-CCA facility

class from May 15, 2013, to present); Securus Opp'n at 13-14 (non-

CCA facilities claims can reach back only to 2013).

Lastly, Securus argues that any allegations that it failed to

comply with the Inmate Rate Order are futile because the Inmate

Rate Order has future effect only. See Securus Opp' n at 16.

Plaintiffs counter that they are not seeking to have the Inmate

Rate Order applied retroactively. If and when the Court determines

damages under

and 207, the Court will be able to

rely on the guidance and expertise provided by the FCC. See Pls.'

Reply at 14-15. Because Plaintiffs have not asked for the Inmate

Rate Order to be applied retroactively and, in any event, because

their requests for damages do not rely exclusively on the Inmate

-17- Rate Order, Defendants have not shown that amendment of the

Complaint would be futile.

F. Equity Does Not Bar Relief

CCA contends that equity estops Plaintiffs from amending their

Complaint. See CCA Opp' n at 9-10. CCA' s main argument is that

Plaintiffs represented to the Court in 2001 when seeking a stay of

the case, that Defendants would not be prejudiced by the stay, and

that the present Motion does indeed prejudice the Defendants.

Since the Court has already rejected Defendants' prejudice

arguments, there is no need to address them again under the

umbrella of equity.

IV. CONCLUSION

For the foregoing reasons, Plaintiffs' Motion for Leave to

Amend their Complaint shall be granted. An Order shall accompany

this Memorandum Opinion.

January 21, 2016 G~~~ GladysKeier United States District Judge

Copies to: attorneys on record via ECF

-18-