October 14, 2013
Occasionally, plaintiffs file suit only hours before the applicable statute of limitations expires. Occasionally, plaintiffs later find and/or decide to sue an additional party. When these occurrences coincide, plaintiffs cry “mistake” and hope that Rule 15(c) of the Federal Rules of Civil Procedure will save their otherwise time-barred claim against the newly added defendant. In the Sixth Circuit, plaintiffs have historically found that this argument rarely works. However, informed Sixth Circuit plaintiffs now cite to a recent Supreme Court decision, Krupski v. Costa Crociere S.p.A., 130 S. Ct. 2485 (2010), in support of their relation back argument. As explained in greater detail below, Krupski does not apply to the scenario presented above and does not alter existing Sixth Circuit precedent – a sentiment shared by some lower Sixth Circuit courts.
Pursuant to Rule 15(c)(1)(C), an amendment adding a new party to an action will relate back to the time of the original pleading if three requirements are met. First, the claim against the newly added party must arise “out of the conduct, transaction, or occurrence set out – or attempted to be set out – in the original pleading.” Fed. R. Civ. P. 15(c)(1)(B) and (C). Second, the newly added party must have received notice of the action within 120 days of the filing of the original complaint. Fed. R. Civ. P. 15(c)(1)(C)(i). Third, within 120 days of the filing of the original complaint, the newly added party must have known, or should have known, “that the action would have been brought against it, but for a mistake concerning the proper party’s identity.” Fed. R. Civ. P. 15(c)(1)(C)(ii).
As to the third requirement, the Sixth Circuit holds that a “mistake concerning the proper party’s identity” means instances of misnomers or misidentification. Accordingly, the Sixth Circuit refuses to apply relation back when a plaintiff adds, as opposed to substitutes, a new party. See In re Kent Holland Die Casting & Plating, Inc., 928 F.2d 1448, 1449 (6th Cir. 1991); United States ex rel. Statham Instruments, Inc. v. Western Cas. & Surety Co., 359 F.2d 521, 523 (6th Cir. 1966) (an amendment that adds a new party “establishes a new and independent cause of action which cannot be maintained when the statute has run, for the amendment is one of substance rather than one of form and brings into being one not presently in court”). Despite what some plaintiffs claim, Krupski does not abrogate this precedent.
Wanda Krupski was injured while on a cruise ship owned by Costa Crociere, S.p.a (“Crociere”). Despite Krupski’s cruise ticket requiring that any claim be sent to Crociere, Krupski sued Costa Cruise Lines (“Cruise”), a subsidiary of Crociere and the entity that issued Krupski’s ticket. Subsequently, Cruise informed Krupski on several occasions that Crociere was the ship’s owner and operator. Eventually, Krupski amended her complaint to add Crociere. Krupski, 130 S. Ct. at 2489-2491.
Upon a motion to dismiss, the district court dismissed the claim against Crociere as time-barred. The district court held that Krupski’s amended complaint did not relate back because Krupski did not make a “mistake” about the identity of the defendant when she knew about Crociere’s existence at the time she filed her original complaint. The Eleventh Circuit Court of Appeals affirmed. Krupski, 130 S. Ct. at 2491-2492. The Supreme Court reversed, holding that “relation back under Rule 15(c)(1)(C) depends on what the party to be added knew or should have known, not on the amending party’s knowledge or its timeliness in seeking to amend the pleading.” The Court reasoned that a “deliberate but mistaken choice” of defendant is still a mistake under Rule 15. Krupski, 130 S. Ct. at 2493-2496.
Because Krupski involved the substitution of a mistaken defendant for a proper defendant and not the addition of a new defendant, Krupski does not abrogate Sixth Circuit precedent. In fact, the district court for the Middle District of Tennessee considered Krupski and concluded that
under unambiguous Sixth Circuit precedent, Plaintiffs’ proposed amendment is barred because the statute of limitations has run, and Plaintiffs seek to add new parties, rather than to substitute the correct parties for parties erroneously named in the original, timely pleading.
Venezia v. 12th & Division Props., LLC, No. 3:09-cv-430, 2010 U.S. Dist. LEXIS 80750 at *6 (M.D. Tenn. Aug. 6, 2010).
Moreover, the United States Bankruptcy Court for the Eastern District of Tennessee found that
[w]hile the [Supreme] Court broadly defined “mistake” under Rule 15(c)(1)(C)(ii), it did not consider whether the limiting phrase “concerning the proper party’s identity” should be expanded beyond the contours set by the Sixth Circuit (i.e., misnomer or misdescription). Further, that case merely involved the substitution of a proper defendant for an erroneously named one, not the addition of a second defendant. As such, Krupski does not directly overrule the Sixth Circuit’s construction of “mistake concerning the proper party’s identity” and the related bar on adding more parties.
Jahn v. Bedford Consulting Group, LLC, 441 B.R. 294, 297-98 (Bankr. E.D. Tenn. 2010) (internal citations omitted).
Ultimately, until the Sixth Circuit decides otherwise, attorneys representing newly added defendants should continue to argue that the Sixth Circuit does not allow relation back where an amended pleading adds a new party.
— C.E. Hunter Brush
