Court filing
Response in Opposition re 114 Motion to Dismiss for Lack — Marshall v. Prestamos CDFI, LLC (Dkt. 118, E.D. Pa. No. 5:21-cv-04337)
Filed May 21, 2024 in Marshall v. Prestamos CDFI, LLC; one of 344 filings from this case.
Record facts
| Court | U.S. District Court for the Eastern District of Pennsylvania |
|---|---|
| Filed | 2024-05-21 |
U.S. District Court for the Eastern District of Pennsylvania · No. 5:21-cv-04337-JMG · Doc. 118 · 2024-05-21 · Docket on CourtListener
Full text
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
ALICIA MARSHALL, et al., individually
and on behalf of all others similarly situated,
Plaintiffs,
v.
PRESTAMOS CDFI, LLC and CHICANOS
POR LA CAUSA, INC.,
Defendants.
Civil Action No. 5:21-cv-04337-JMG
PLAINTIFFS’ OPPOSITION TO DEFENDANT CHICANOS POR LA CAUSA, INC.’S
MOTION TO DISMISS PLAINTIFFS’ THIRD AMENDED CLASS ACTION
COMPLAINT
Plaintiffs Alicia Marshall, Daniel Pronsky, Paris Townsend, Nancilee Holland, Leona
Owsley, Kolawole Ahmadou, Kiana Dervin, Kristina Henderson, Dustin Innis, Kelly Stalnaker,
Jamie Jones, Georgina Drevnak, John Martin, Ezra Beattie, Gregory Lloyd, Alyshia Johnson,
Lametria Marvel, Guy Grichar, Jahbrael Horne, Enobong Etuknwa and Sharon Bradley Smith
(collectively, “Plaintiffs”), respectfully submit this response in opposition to defendant Chicanos
Por La Causa, Inc.’s (“CPLC”) Motion to Dismiss Plaintiffs’ Third Amended Class Action
Complaint (ECF No. 114). The Court should deny CPLC’s motion.
Plaintiffs’ Third Amended Complaint (the “TAC”) explicitly acknowledges in the
opening paragraph that, by Order on December 5, 2023 (ECF No. 93), the Court granted
CPLC’s motion to dismiss and that “Plaintiffs accordingly include CPLC as a defendant in this
amended complaint to the extent relevant to Plaintiffs’ claims against defendant Prestamos, and
to preserve Plaintiffs’ rights in the event of an appeal.” See ECF No. 108 at 1-2. This is
permissible pleading practice. See U.S. ex rel. Atkinson v. PA. Shipbuilding Co., 473 F.3d 506,
Case 5:21-cv-04337-JMG Document 118 Filed 05/21/24 Page 1 of 7
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517 (3d Cir. 2007) (“Adding a section to an amended pleading specifically preserving [a
dismissed] claim certainly suffices” to preserve the claim for appeal). See also G.S. v. Penn-
Trafford Sch. Dist., No. 20-3281, 2023 WL 4486667, at *2 n.20 (3d Cir. July 12, 2023) (“To
date, we have ‘not adopt[ed] a rigid requirement as to what a plaintiff must do to stand on a
dismissed complaint.’”) (quoting Atkinson).
The Third Circuit’s ruling in Atkinson is spot on. Atkinson involved claims by a relator
plaintiff under the False Claims Act alleging that defendant companies conspired to defraud the
United States Navy in connection with a contract to build oil tankers. Atkinson, 473 F.3d at 509.
The district court dismissed plaintiff Atkinson’s third amended complaint, “relying on both
jurisdictional and substantive deficiencies.” Id. Plaintiff appealed. One of the defendants argued
on appeal that plaintiff “Atkinson waived his right to appeal the District Court’s dismissal of
[defendant] Sun Ship from the Second Amended Complaint by failing to replead claims against
Sun Ship in his Third Amended Complaint.” Id. at 515. The Third Circuit affirmed dismissal,
holding that “[w]e agree with Sun Ship and hold that Atkinson has waived his right to assert
error in connection with the dismissal of his claims against Sun Ship.” Id. In so holding, the
Third Circuit stated that the bright line rule is as follows: “We conclude that where, as here, it
would not have been futile to replead dismissed claims but those dismissed claims are
nevertheless omitted from an amended pleading, the right to challenge the basis for dismissal on
appeal is waived.” Id. at 516 (emphasis added).
Indeed, the Third Circuit in Atkinson drew a distinction between a plaintiff’s failure to
include a dismissed claim in an amended complaint, and a dismissed “defendant rather than
merely a cause of action.” (emphasis in original). Id. The Third Circuit held that in the case of
failing to include a dismissed claim in an amended complaint, “the proper rule allows plaintiffs
Case 5:21-cv-04337-JMG Document 118 Filed 05/21/24 Page 2 of 7
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to appeal dismissals despite amended pleadings that omit the dismissed claim provided
repleading the particular cause of action would have been futile.” Id. (emphasis in original). By
contrast – and directly at issue here – the Third Circuit also held that “[w]hen a plaintiff’s
amended complaint leaves out a party previously named in the preceding complaint, the
equitable principles we enunciate here apply even more strongly because parties that do not
appear in amended complaints have a legitimate expectation that they are no longer involved in
the litigation.” Id.
CPLC relies exclusively on the “final judgment rule” to argue that “Plaintiffs’ appellate
rights are preserved” (ECF No. 114-1 at 2). But the final judgment rule does not preserve
Plaintiffs’ rights concerning the Court’s prior dismissal of CPLC or even address that issue. See,
e.g., Atkinson, supra; Gagliardi v. Verizon Pennsylvania Inc., 357 F. App'x 413, 415 (3d Cir.
2009) (plaintiff could not “challenge the dismissal of that claim because he neither reasserted it
in his amended complaint (despite having an opportunity to do so) nor indicated that he intended
to stand on that claim as originally pleaded”); In re Am. Inv. Life Ins. Co. Annuity Mktg. & Sales
Pracs. Litig., No. 04-cv-3329, 2010 WL 1407308, at *4 (E.D. Pa. Apr. 7, 2010) (“Plaintiffs who
drop defendants in subsequent complaints waive their right to bring these defendants back into a
matter.”).
CPLC cites only Digital Equipment Corp. v. Desktop Direct, Inc., 511 U.S. 863, 868
(1994) and Carter v. City of Philadelphia, 181 F.3d 339, 343 (3d Cir. 1999). But those cases
involve the issue of when a judgment is final for purposes of appeal under 28 U.S.C. § 1291. See
Digital Equipment, 511 U.S. at 865 (“This case raises the question whether an order vacating
dismissal predicated on the parties’ settlement agreement is final ….”); Carter, 181 F.3d at 343
(the district court issued a final judgment pursuant to Rule 54(b) but neglected to set forth
Case 5:21-cv-04337-JMG Document 118 Filed 05/21/24 Page 3 of 7
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specific findings). The final judgment rule is neither in dispute nor relevant concerning whether
Plaintiffs in their TAC had the right and indeed obligation to include CPLC as a defendant to
preserve their rights in the event of an appeal.
In fact, if Plaintiffs failed to include CPLC as a defendant in the TAC and an appeal
ensued, CPLC could argue that Plaintiffs’ allegations in prior pleadings including CPLC as a
defendant are of no legal effect and that the passage of time precludes Plaintiffs from asserting or
reasserting those claims. See also Rockwell Intern. Corp. v. U.S., 549 U.S. 457, 473–74 (2007)
(“Thus, when a plaintiff files a complaint in federal court and then voluntarily amends the
complaint, courts look to the amended complaint to determine jurisdiction.”); King v. Dogan, 31
F.3d 344, 346 (5th Cir. 1994) (“An amended complaint supersedes the original complaint and renders
it of no legal effect unless the amended complaint specifically refers to and adopts or incorporates by
reference the earlier pleading.”); Atkinson, 473 F.3d at 516 n. 16 (citing additional cases).
As CPLC states (ECF No. 114-1 at 2) and Plaintiffs fully acknowledge and concur, this Court
granted CPLC’s motion to dismiss on grounds of personal jurisdiction and directed the Clerk of
Court to terminate the case as it pertains to CPLC. ECF No. 93. But nothing in that Order addressed
or purported to address, let alone denied, Plaintiffs’ right to potentially appeal that ruling. CPLC is
therefore incorrect that Plaintiffs named CPLC as a defendant in their TAC “[i]n direct defiance of”
that Order (ECF No. 114-1 at 1) particularly in view of governing Third Circuit precedent in
Atkinson which CPLC’s motion does not even cite.
Further, Plaintiffs have abided by the spirit of Court’s Order since the Court dismissed CPLC.
For example, Plaintiffs have not served or sought to serve any discovery on CPLC as a party
defendant (or even a non-party) since the Court dismissed CPLC. Plaintiffs also do not intend to seek
any discovery from CPLC as a party or a non-party going forward; indeed, Plaintiffs already have
Case 5:21-cv-04337-JMG Document 118 Filed 05/21/24 Page 4 of 7
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obtained jurisdictional discovery from CPLC which is reflected in the record in this case (ECF Nos.
86-87) and which likewise preserves Plaintiffs’ rights in the event of an appeal.
Finally, CPLC’s Certificate of Conference accompanying its motion states that the parties
met to try to resolve this issue before CPLC filed its motion. That is true. But CPLC omits that
Plaintiffs offered to stipulate to the dismissal of CPLC if CPLC agreed that Plaintiffs would not be
prejudiced by CPLC’s absence on grounds of statutes of limitation defenses or otherwise in the event
of an appeal later in this litigation. CPLC never responded to that offer, and instead filed its motion
the next day.
Conclusion
For the foregoing reasons, the Court should deny CPLC’s motion to dismiss.
Dated: May 21, 2024
Respectfully submitted,
Bailey & Glasser LLP
By: /s/ Lawrence J. Lederer
Lawrence J. Lederer (Pa. ID 50445)
Bart D. Cohen (Pa. ID 57606)
1622 Locust Street
Philadelphia, PA 19103
T.: 202.463-2101
F.: 202.463-2103
llederer@baileyglasser.com
bcohen@baileyglasser.com
Bailey & Glasser LLP
Michael L. Murphy (admitted pro hac vice)
1055 Thomas Jefferson Street NW, Suite 540
Washington, DC 20007
T.: 202.463-2101
F.: 202.463-2103
mmurphy@baileyglasser.com
and
Case 5:21-cv-04337-JMG Document 118 Filed 05/21/24 Page 5 of 7
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Nolan Heller Kauffman LLP
Justin A. Heller (pro hac vice)
Matthew M. Zapala (pro hac vice)
80 State Street, 11th Floor
Albany, NY 12207
T: (518) 449-3300
F: (518) 432-3123
jheller@nhkllp.com
mzapala@nhkllp.com
Attorneys for Plaintiffs and the Proposed Classes
Case 5:21-cv-04337-JMG Document 118 Filed 05/21/24 Page 6 of 7
CERTIFICATE OF SERVICE
I hereby certify that on the 21st day of May 2024, the foregoing was electronically filed
and served through the Court’s CM/ECF system to counsel of record.
/s/ Lawrence J. Lederer
Lawrence J. Lederer
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