Leave to Amend-Fraud

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7^th Circuit Court of Appeals

Case Name: Rachael Schmees v. HC1.com, Inc.

Case No.: 22-1214

Officials: Wood, St. Eve, and Kirsch, Circuit Judges.

Focus: Leave to Amend-Fraud

Shortly after Schmees commenced her employment with HC1.COM, her role was eliminated. In response, Schmees initiated a lawsuit, asserting that HC1 had deceptively induced her to join the company. HC1 subsequently filed a motion to dismiss Schmees’s initial amended complaint. Three months after both parties had presented their arguments regarding the motion, Schmees requested permission to amend her complaint once more, this time introducing fresh factual allegations to reinforce the same claims. The district court denied HC1’s motion to dismiss Schmees’s fraud-related allegations and deemed the motion for leave to amend moot. The court granted Schmees a month to resubmit the motion, but she chose not to pursue further amendments. In response to HC1’s subsequent motion for summary judgment, Schmees endeavored to augment her complaint with an additional fraud claim through her legal brief. However, the district court ruled in favor of HC1 by granting summary judgment, contending that the new fraud claim exceeded the scope of the original complaint, and refused to consider her response brief as a de facto alteration of the complaint.

The Seventh Circuit determined that the district court had exercised its discretion appropriately. Having established that Schmees had adequately articulated her fraud-based claims, incorporating new facts to substantiate these claims proved unnecessary. The court had previously extended an invitation to Schmees to reapply for leave to amend, which she opted not to pursue. Consequently, by the time summary judgment was sought, it had become too late for Schmees to introduce a fresh claim that extended beyond the confines of the original complaint.

Affirmed

Decided 08/08/23

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