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The Procter & Gamble Co. v. Hello Products, LLC

United States District Court, Southern District of New York

May 20, 2015

THE PROCTER & GAMBLE COMPANY, Plaintiff,
v.
HELLO PRODUCTS, LLC, Defendant.

OPINION & ORDER

Honorable Ronald L. Ellis United States Magistrate Judge

I. INTRODUCTION

On January 31, 2014, Plaintiff Procter & Gamble Company ("P&G") filed a Complaint against Defendant Hello Products, LLC ("Hello"). (Doc. No. 2.) On June 17, 2014, the Honorable Victor Marrero referred this case to the undersigned for general pretrial purposes. (Doc. No. 23.) Before the Court is P&G's Motion for Leave to Amend the Complaint. (Doc. No. 40.) For the reasons that follow, the Motion is DENIED.

II. DISCUSSION

In its original Complaint, P&G's claims include false advertising in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and deceptive acts and practices and false advertising in violation of N.Y. Gen. Bus. Law §§ 349 and 350. (Doc. No. 2, ¶ 1.) P&G alleges:

Hello recently began manufacturing and distributing oral care products, including Hello™ anticavity toothpaste ("Hello Paste"). On its labeling and in advertising and promotion, Hello claims that Hello Paste is "99% natural." In fact, a significant proportion of the ingredients in Hello Paste are extensively and chemically processed, and the product thus is not 99% natural.

(Id., ¶ 2.) In P&G's proposed Amended Complaint, P&G seeks to add the phrase "naturally friendly" to the paragraph above because "after P&G commenced this lawsuit and Hello stipulated to a preliminary injunction pursuant to which it agreed to abandon the '99% natural' claim, Hello began labeling, advertising and promoting Hello Paste as 'naturally friendly.'" (Doc. No. 40. Ex. B. 2.)

A. Legal Standard

Generally, courts should freely give leave to amend pleadings "when justice so requires." Fed.R.Civ.P. 15(a); Williams v. Citigroup, Inc., 659 F.3d 208, 212 (2d Cir. 2011); Rachman Bag Co. v. Liberty Mut. Ins. Co., 46 F.3d 230 (2d Cir. 1995). A court may deny a motion to amend when (1) the movant is guilty of undue delay, (2) the movant has acted in bad faith, (3) the amendment would be futile, or (4) the amendment would prejudice the opposing party. State Teachers Retirement Board v. Fluor Corp., 654 F.2d 843, 856 (2d Cir. 1981); see Dluhos v. Floating and Abandoned Vessel, Known as New York, 162 F.3d 63, 69 (2d Cir. 1998); Cevasco v. National R.R. Passenger Corp., No. 04-CV-5760, 2007 WL 4440922, at *3 (S.D.N.Y. Dec. 18, 2007) (citing Foman v. Davis, 371 U.S. 178, 182 (1962)).

B. P&G Acted with Undue Delay

A motion to amend under Rule 15(a)(2) may be made at any stage of the litigation. See 6 Charles Allen Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 1487 (3d ed. 2010). A party seeking to amend, however, should bring its motion "as soon as the necessity for altering the pleading becomes apparent" to avoid an allegation of delay. Id. at § 1488; see also Cresswell v. Sullivan & Cromwell, 922 F.2d 60, 72 (2d Cir. 1990).

Hello argues that P&G acted with undue delay in moving to amend over a year after filing the original Complaint in January 2014. (Doc. No. 44, at 5-7.) Hello states that it "began referring to its products as 'naturally friendly' in publicly available materials, such as press releases and ad campaigns, " in June 2013, and that "P&G obtained one of the Hello press releases that included the phrase 'naturally friendly'" in September 2013. (Id. at 5.) P&G cited the September 2013 press release in its Complaint. (Doc. No. 2, ¶ 29.) Beginning in January 2014. Hello "began prominently featuring the 'naturally friendly' mark on its website and on retailers' shelves" and "the 'naturally friendly' mark and photo of the re-designed toothpaste bottle began to appear on Hello's website." (Doc. No. 44, at 6.) By February 2014, Hello products bearing the new "naturally friendly" mark were on retailers' shelves. (Id.) In March 2014, Hello showed P&G the updated bottle of toothpaste with the new "naturally friendly" mark at a conference before the Court. (Id.) In addition, in March 2014, the Parties agreed to a Stipulation, which specifically stated that Hello had changed its products to the "naturally friendly" mark. (Doc. No. 40, Ex. D, ¶ 5.)

This Court has held, "If a proposed amendment is based on 'information that the party knew or should have known prior to the deadline [to file an amendment], leave to amend is properly denied.'" Hyo Jung v. Chorus Music Studio, Inc., No. 13-CV-1494 (RLE), 2014 WL 4493795, at *2 (S.D.N.Y. Sept. 11, 2014) (citing Soroof Trading Dev. Co., Ltd. v. G.F. Microgen, Inc., 283 F.R.D. 142, 147 (S.D.N.Y. 2012)). P&G's deadline to amend its Complaint was April 15, 2014. P&G knew that Hello had changed it mark and had adopted the "naturally friendly" tagline at least one month before the deadline to amend. Moreover, P&G waited another ten months after the deadline to file its Motion to Amend.

P&G claims that it waited to move to amend because an amendment was not warranted until P&G learned of certain facts during discovery. (Doc. No. 46, at 6.) More specifically, P&G alleges that is learned during depositions in January and February 2015 that "Hello intended to convey the same false and misleading uniquely natural messaging through the 'naturally friendly' claim that it had by its discontinued '99% natural' claim." (Id.) P&G does not adequately explain, however, why this claim about motivation necessitates an amendment. If P&G wanted to include the "naturally friendly" claim, then it could, and should, have amended its Complaint before the deadline or soon ...


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