United States District Court, N.D. Alabama, Southern Division
DAVID PRO'CTOR UNITED STATES DISTRICT JUDGE
matter is before the court on Plaintiff's Motion for
Leave to File First Amended Complaint. (Doc. # 32). The
Motion is fully briefed. (Docs. # 32, 34, 35). For the
reasons explained below, the Motion is due to be granted.
Relevant Procedural History
March 13, 2017, Plaintiff Birmingham Emergency Communication
District (“Plaintiff” or “the
District”) filed this action against Defendants
Bandwidth.com, Inc. and Bandwidth.com CLEC, LLC (collectively
“Defendants” or “Bandwidth”),
alleging (1) violation of the Emergency Telephone Services
Act (“ETSA”),  Ala. Code § 11-98-1 et
seq., (2) negligence / negligence per se /
gross negligence / recklessness, (3) breach of fiduciary
duty, (4) wantonness, and (5) misrepresentation / fraud.
(Doc. # 1). Specifically, Plaintiff alleged that Bandwidth
failed to bill, collect, and remit 911 charges in accordance
with the ETSA, causing Plaintiff to suffer substantial
financial loss. (Id. at ¶ 16-17, 26-27). On May
31, 2017, Bandwidth moved to dismiss Count I (violation of
the ETSA) to the extent that the District sought to impose
liability on Bandwidth as a wholesaler and not in connection
with Bandwidth's retail business. (Doc. # 11). The court
found that the ETSA did not require telecommunication
wholesalers to collect and remit 911 charges, and granted
Defendants' Partial Motion to Dismiss Count I of
Plaintiff's Complaint (Doc. # 11) on December 5, 2017.
(Docs. # 26, 27).
January 11, 2018, Plaintiff filed the instant Motion for
Leave to File First Amended Complaint. (Doc. # 32). In its
Proposed Amended Complaint Plaintiff adds (among other
alleged facts) allegations that Bandwidth “treated the
vast majority of its customers as being ‘exempt from
taxation, ' and thus exempt from 911 Charges, even though
the Defendant did not obtain exemption certificates or other
documentation to substantiate the tax exempt status”
and that “[t]ypically, service providers that sell
telephone service ‘at wholesale' must obtain
exemption certificates from their ‘wholesale'
customers.” (Doc. # 32-1 at ¶ 4, 21-23).
Defendants oppose this Motion because they argue that (1)
Plaintiff's new theory of recovery is incompatible with
the court's previous Memorandum Opinion (Doc. # 26) and
is based on an unsupported reading of the ETSA and (2)
Plaintiff is seeking an “impermissible second bite at
the apple.” (See Doc. # 34).
Standard of Review
of the Federal Rules of Civil Procedure governs amended and
supplemental pleadings. Absent circumstances not relevant
here, a party may amend the pleadings only by leave of the
court or by written consent of the adverse party.
See Fed R. Civ P. 15(a)(2). “The court should
freely give leave when justice so requires.”
Id. “Ordinarily, a party must be given at
least one opportunity to amend before the district court
dismisses the complaint.” See Corsello v. Lincare,
Inc., 428 F.3d 1008, 1014 (11th Cir. 2005). That is,
“[u]nless a substantial reason exists to deny leave to
amend, the discretion of the District Court is not broad
enough to permit denial.” Fla. Evergreen Foliage v.
E.I. DuPont De Nemours and Co., 470 F.3d 1036, 1041
(11th Cir. 2006) (quotation marks omitted).
court, however, need not allow an amendment that would be
futile. See Bryant v. Dupree, 252 F.3d 1161, 1163
(11th Cir. 2001). Nor must a court allow an amendment where
there has been undue delay, bad faith, dilatory motive, or
repeated failure to cure deficiencies by amendments
previously allowed or where allowing the amendment would
cause undue prejudice to the opposing party. See Halpin
v. Crist, 405 Fed. App'x 403, 408-09 (11th Cir.
2010) (quoting Corsello, 428 F.3d at 1014); see
also Maynard v. Bd. of Regents of Div. of Univs., 342
F.3d 1281, 1287 (11th Cir. 2003) (holding that the district
court did not abuse its discretion in denying a motion to
amend filed on the last day of discovery because granting the
motion “would have produced more attempts at discovery,
delayed disposition of the case, likely prejudice . . . [and]
there seems to be no good reason why [the movant] could not
have made the motion earlier”). A district court may,
in the exercise of its inherent power to manage the conduct
of litigation before it, deny leave to amend a complaint,
“so long as it does not outright refuse to grant the
leave without any justifying reason.” Equal Rights
Center v. Niles Bolton Assocs., 602 F.3d 597, 603 (4th
Cir. 2010); see also Reese v. Herbert, 527 F.3d
1253, 1263 (11th Cir. 2008).
alleges that certain services of Bandwidth may not qualify as
wholesaler services within the meaning of the ETSA and that
its Amended Complaint makes additional allegations clarifying
this position. (Docs. # 32, 35). Defendants counter that
Bandwidth's Amended Complaint is futile and seeks an
impermissible second bit at the apple. (Doc. # 34). In
arguing futility, Bandwidth contends that the District's
Amended Complaint is incompatible with the court's
previous decision in this case and the ETSA. (Doc. # 34 at p.
4-5). However, Plaintiff's allegations that wholesale
service providers typically obtain exemption certificates to
prove their wholesale status and that Defendants have not
offered proof of their wholesale status is not necessarily
incompatible with the court's previous ruling that the
ETSA did not impose a duty on telecommunication wholesalers
prior to October 1, 2013. Ultimately, at this stage, there is
insufficient legal authority for the court to make a ruling
that Plaintiff's Amended Complaint is futile.
to the defendant is the most frequent reason courts deny
motions for leave to amend the complaint.” Giraldo
v. Drummond Co., Inc., No. 2:09-cv-1041-RDP, 2011 WL
13136941, at *2 (N.D. Ala. Sept. 27, 2011) (citing 6 Fed.
Prac. & Pro. 2d § 1487). Here, Defendants have made
no showing that they would be prejudiced by this Amended
Complaint or that there has been undue delay. As Plaintiff
notes, discovery in this case has not concluded, and the
court has previously suggested that the parties may need to
propose a new scheduling order. (Docs. # 22; 29 at p. 12; 32
at p. 4). Because the court finds that Plaintiff's
“‘more carefully drafted complaint might
state a claim, '” justice requires that Plaintiff
be granted leave to amend its complaint. Bryant, 252
F.3d at 1163 (quoting Bank v. Pitt, 928 F.2d 1108,
1112 (11th Cir.1991)) (emphasis added); see Fed R.
Civ P. 15(a)(2).
reasons outlined above, Plaintiffs Motion for Leave to Amend
Complaint is due to be granted. An Order consistent with this
Memorandum Opinion will be entered.