The opinion of the court was delivered by: SHIRA SCHEINDLIN, District Judge
MEMORANDUM OPINION AND ORDER
This case was filed close to three years ago, discovery closed on
October 2, 2004, defendants' motion for partial summary judgment was
decided on January 7, 2005, and a trial is scheduled to begin on March
21, 2005. Nonetheless, defendants now move to amend their Answer to
include an additional affirmative defense. Specifically, defendants seek
to add an after-acquired evidence defense on the ground that plaintiff,
in her employment application with UBS Warburg LLC ("UBS"),
misrepresented the reasons why she was terminated by Credit Suisse First
Boston ("CSFB") and Salomon Brothers ("Salomon").*fn1
Defendants contend that had UBS learned of plaintiff's
misrepresentations, it would have immediately terminated her employment.
For the following reasons, defendants' motion is denied.
A. The Alleged Misrepresentations
Defendants claim that plaintiff made the following misrepresentations
on her employment application (dated July 14, 1999), which is signed and
recites that she understands that the information provided is true and
complete and that any false or misleading statements or omissions will be
sufficient cause to justify refusal or termination of employment:
(1) her employment at CSFB ended in May 1999 (as
opposed to August 1999)
(2) the reason for her departure from CSFB was "diff
w/mgmt philosophy nature of job changed"
(3) her termination from CSFB was "voluntary"
(4) the reason for her departure from Salomon was to
pursue a "better opportunity"
(5) her termination from Salomon was "voluntary"
See UBS Group, Employment Application, Employment History, attached as
Ex. B to the Plevan Decl.
Plaintiff's personnel file produced by CSFB in March 2003 records
Zubulake's last day of work as May 10, 1999, and a date of separation of
August 16, 1999. The file also contains a document that describes a
performance deficiencies, namely, a May 5th 1999 Memorandum from Jay
Plourde entitled "Performance Deficiencies." See Memorandum, Ex. C to the
Plevan Decl. The Memorandum states that plaintiff was insubordinate
toward her supervisors and that her job performance was substandard. The
Memorandum explicitly warns plaintiff that "[f]ailure to comply with the
terms of this memo immediately or other failure to perform satisfactorily
will result in further disciplinary action up to and including your
immediate termination from this firm." Id.
Plaintiff's personnel file from Salomon could not be produced as it was
destroyed during the attacks of September 11, 2001. Although hard copy
records pertaining to plaintiff were not available, a computer print-out
(produced in March 2003) indicates that she was terminated for
"unsatisfactory perf." 2/20/03 Computer Print-Out, Ex. D to the Plevan
B. Plaintiff's Termination Documents
In opposing the motion, plaintiff has submitted her Form U-5, Uniform
Termination Notice For Securities Industry Registration, from CSFB and
Salomon. See Affirmation of James A. Batson ("Batson Aff."), plaintiff's
attorney, Exs. C & D. Both forms contain the following boxes under the
Reason For Termination section: voluntary, deceased, permitted to
other. See id. Plaintiff's U-5 for CSFB has the "voluntary" box
checkmarked as the reason for termination but does not provide an
explanation. See id., Ex. C. Plaintiff's U-5 for Salomon has the "other"
box checkmarked as the reason for termination and provides "resign
mutual" as the explanation. See id., Ex. D.
Defendants have submitted a Central Registration Depository
Registration Summary obtained from the National Association of Securities
Dealers which they obtained on January 4, 2005. This document contains
plaintiff's registration information pertaining to her prior employers. As
with the U-5, plaintiff's Registration Summary states "Voluntary" as the
reason for termination from CSFB. See Plevan Decl., Ex. E at 3.
Similarly, the Registration Summary indicates "Other" as the reason for
plaintiff's termination from Salomon and contains "resign mutual" as the
termination comment. See id. at 5.
Leave of court to amend a pleading "shall be freely given when justice
so requires." Fed.R.Civ.P. 15(a). However, whether to grant a motion to
amend lies within the sound discretion of the trial court. See Foman v.
Davis, 371 U.S. 178, 182 (1962). In Foman, the Supreme Court expressly
reaffirmed the liberal mandate of Rule 15(a).
If the underlying facts or circumstances relied upon
by a plaintiff may be a proper subject of relief,
[s]he ought to be afforded an opportunity to test
[her] claim on the merits. In the absence of any
apparent or declared reason such as undue delay, bad
faith or dilatory motive on the part of the movant,
repeated failure to cure deficiencies by amendments
previously allowed, undue prejudice to the opposing
party by virtue of allowance of the amendment,
futility of amendment, etc. the leave sought
should, as the rules require, be `freely given.' Of
course, the grant or denial of an opportunity to amend
is within the discretion of the District Court. . . .
Id. at 182.
The Second Circuit has stated that "`considerations of undue delay, bad
faith, and prejudice to the opposing party [are] touchstones of a
district court's discretionary authority to deny leave to amend.'" Krumme
v. Westpoint Stevens Inc., 143 F.3d 71, 88 (2d Cir. 1998) (quoting
Barrows v. Forest Labs., 742 F.2d 54, 58 (2d Cir. 1984) (footnote
omitted)). Factors relevant to a showing of prejudice include "whether
the assertion of new claims would: (i) require the opponent to expend
significant additional resources to conduct discovery and prepare for
trial; (ii) significantly delay the resolution of the dispute; or (iii)
prevent the plaintiff from bringing a timely action in another
jurisdiction." Block v. First Blood Assocs., 988 F.2d 344, 350 (2d Cir.
1993). In fact, "`[o]ne of the most important considerations in
determining whether amendment would be
prejudicial is the degree to which it would delay the final disposition of
the action.'" Krumme, 143 F.3d at 88 (quoting H.L. Hayden Co. of New
York, Inc. v. Siemens Med. Sys., Inc., ...