James Engstrom v. United Airlines, Inc.

asserted, for the very first time in the nearly two-year litigation, claims under Title VII against United. The district court denied the motion and dismissed the case, citing undue delay and prejudice as well as futility of the proposed amendment. Engstrom and Shaw appeal that decision. On the unique facts of this case, we see no abuse of discretion, so we affirm.

I

During the COVID-19 pandemic, United Airlines implemented a vaccine policy that required employees to receive at least one dose of the COVID-19 vaccine by September 27, 2021. Employees who did not receive the vaccine and who were not exempted would be fired. And employees who received exemptions would be required to take unpaid leave indefinitely, without benefits. Engstrom and Shaw, both Christians, sought and received a religious exemption from the requirement and then were placed on unpaid leave, lasting several months, as an accommodation. While on leave in December 2021, Engstrom and Shaw, who live in Florida, each filed charges against United with the Florida Commission on Human Relations ("FCHR") and the Equal Employment Opportunity Commission ("EEOC"), alleging discrimination and retaliation under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq., and the Florida Civil Rights Act ("FCRA"), Fla. Stat. § 760.01, et seq. The next month, they also filed charges of discrimination with the EEOC and the FCHR against their union, Air Line Pilots Association International.

In November 2022, after receiving a right-to-sue notice from the EEOC with respect to their charges against the union, Engstrom and Shaw sued the union and the United Airlines Master Executive Council (a chapter of the union for United employees)—but not United—in the Middle District of Florida. That complaint against the union and council alone alleged violations of, among other things, both the FCRA and Title VII. Five months later, in April 2023, Engstrom and Shaw filed an amended complaint, adding United as a defendant and removing the council. In this complaint, Engstrom and Shaw only raised state law claims (FCRA and Florida common law) against United, but continued to assert both Title VII and FCRA claims against the union. United and the union separately moved to dismiss the complaint on various grounds, and both argued venue was not proper in the Middle District of Florida. The district court agreed and, in November 2023, transferred the case to the Northern District of Illinois.

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The EEOC then issued a right-to-sue notice with respect to the charges against United, giving the Plaintiffs until March 19, 2024, to file any Title VII claims against their employer. The next month, with leave of the district court, Engstrom and Shaw filed a second amended complaint, again raising claims against both United and the union. But notably, Engstrom and Shaw failed to add a Title VII claim against United at that time, continuing to press only claims under the FCRA and state common law. (Meanwhile, they continued to include Title VII claims against the union.) United and the union again moved to dismiss, and the district court granted those motions on various grounds. The court gave Engstrom and Shaw one more chance to move for leave to amend and submit a proposed amended complaint that stated at least one viable claim over which it had jurisdiction.

Engstrom and Shaw timely submitted a proposed third amended complaint on August 26, 2024. This time, they switched course entirely—alleging a Title VII violation for the first time against United and dropping the union and all other claims from the lawsuit. United opposed the motion, arguing that it was "an exercise in futility" and that the "inexcusable delay in asserting their Title VII claims will prejudice United by forcing it to defend against claims that are both baseless and barred."

The district court denied leave to amend and dismissed the case. It first explained that the Title VII claims were not time barred because they related back to the date of the original pleading. But, it continued, Engstrom and Shaw could have raised these claims in their second amended complaint, made no attempt to explain why they failed to do so even after United "took [them] to task" on this issue in briefing, and offered a "less than satisfactory" explanation (that they were seeking the greater remedies available under the FCRA) when pressed by the court at a hearing. The court expressed that "there was and is absolutely no sound reason for plaintiffs not to include parallel Title VII claims against United in their second amended complaint, particularly when they asserted such claims against [the union]." The court also observed that the Plaintiffs "then waited five months past the limitations period for bringing Title VII claims before they sought leave to amend to add those claims." The court recognized that, on its own, a delay in raising a new claim may not be a sufficient reason to deny a motion for leave to amend, citing Dubicz v. Commonwealth Edison Co., 377 F.3d 787, 793 (7th Cir. 2004), but concluded that the facts here also showed prejudice. Specifically, the court explained that it was "unfair to United to have to defend over a two-year period against serial complaints in which [P]laintiffs essentially pull out of a grab bag whatever claims seem most convenient at the time." Finally, and in the alternative, the

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court concluded that the proposed amendment would be futile because it did not pass the threshold of plausibility.

Engstrom and Shaw now appeal.

II

We review the denial of a motion for leave to amend for an abuse of discretion, McCoy v. Iberdrola Renewables, Inc., 760 F.3d 674, 684 (7th Cir. 2014), overturning if there is no "justifying reason" for the decision, Access Living of Metro. Chi. v. Uber Techs., Inc.,

958 F.3d 604, 616 (7th Cir. 2020) (quoting Perrian v. O'Grady, 958 F.2d 192, 194 (7th Cir. 1992)). As a general matter, federal courts "should freely give leave [to amend a pleading] when justice so requires," F ED. R. CIV. P. 15(a)(2), but that does not mean they must always do so. "[D]istrict courts have broad discretion to deny leave to amend where there is undue delay, bad faith, dilatory motive, repeated failure to cure deficiencies, undue prejudice to the defendants, or where the amendment would be futile." Arreola v. Godinez, 546 F.3d 788, 796 (7th Cir. 2008); see Foman v. Davis, 371 U.S. 178, 182 (1962). In our review, we recognize that the district court is "particularly well- situated to judge the worthiness of a plaintiff's motion to amend his complaint, having been involved in the progress of the case throughout its development and having viewed first-hand the party's diligence or lack thereof." Bohen v. East Chicago, 799 F.2d 1180, 1185 (7th Cir. 1986). The question is not whether we would have "come to a different conclusion than the trial judge," id., but whether "no reasonable person could agree with [the] decision," Schor v. City of Chicago, 576 F.3d 775, 780 (7th Cir. 2009). The district court denied leave to amend here because (1) the Plaintiffs' tactics caused undue delay and prejudice to United, and, in the alternative, (2) amendment would be futile. We affirm on the first basis, so we do not reach the court's alternative holding of futility. With respect to the court's primary holding, Engstrom and Shaw argue that the decision "lacks legal and factual support," insisting that the delay was

"largely irrelevant" and that there was no prejudice to United. We acknowledge that findings of undue delay at the pleading stage are

"unusual," and the issue "generally arises when a plaintiff seeks leave to amend deep into the litigation." McCoy, 760 F.3d at 687. This is because "[t]he underlying concern is the prejudice to the defendant rather than simple passage of time." Id.; see also Park v. City of Chicago, 297 F.3d 606, 613 (7th Cir. 2002) (noting that "the degree of prejudice to the opposing party is a significant factor in determining whether the lateness of the

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request ought to bar filing") (quoting Doherty v. Davy Songer, Inc., 195 F.3d 919, 927 (7th Cir. 1999)); Dubicz, 377 F.3d at 793 ("Delay must be coupled with some other reason. Typically, that reason . . . is prejudice to the non-moving party."). But "unusual"

does not mean impossible, and this is not the first time we have upheld the denial of leave to amend at the pleading stage. See, e.g., McCoy, 760 F.3d at 687; Doe v. Howe Military Sch., 227 F.3d 981, 989-90 (7th Cir. 2000). Though "we approach the concept of undue delay at the pleading stage with some skepticism," on the unique facts of this case, we conclude that the district court acted within its discretion. McCoy, 760 F.3d at

687.

First, the district court reasonably concluded that United faced prejudice if the Plaintiffs' motion were granted. The court's observation that it would be "unfair" to make United continue to defend against the Plaintiffs' "grab bag" approach does not reflect an abuse of discretion. By the time the Plaintiffs submitted their proposed third amended complaint, United had already briefed two motions to dismiss, including one in which the Plaintiffs could have added—but didn't—Title VII claims against it. So even though the litigation had not progressed past the pleadings, United "had already invested significant resources in the case." McCoy, 760 F.3d at 687. And this can be indicative of undue prejudice. See id.; see also Airborne Beepers & Video, Inc. v. AT&T Mobility LLC, 499 F.3d 663, 667 (7th Cir. 2007) (finding prejudice where defendant had already incurred "significant cost[s]" in briefing three motions to dismiss). Second, the district court reasonably considered that Engstrom and Shaw could have asserted their Title VII claims against United in their second amended complaint— after all, they received notices of their right to sue United forty days before they filed that complaint. Instead, they chose not to plead a Title VII claim against United (but only against the union) and proceeded only under the FCRA and state common law. It wasn't until seven months later (five months past the filing deadline for the claim), and after the second amended complaint was dismissed, that they first attempted to assert the Title VII claims against United. And, as they later admitted, they did so because the FCRA offered greater remedies. This strategic decision to forego raising claims that were known and available supports the district court's decision to deny leave to amend. See Park, 297 F.3d at 613 (affirming denial where plaintiff sought leave to amend six months after knowing of a claim she could have brought); George v. Kraft Foods Global, Inc., 641 F.3d 786, 791 (7th Cir. 2011) (noting that waiting until after document production to seek leave to amend in order to avoid seeking leave more than once

"does not excuse [the] belated assertion of the claims [plaintiffs] knew about since nearly the beginning of the case"); see also Glatt v. Chi. Park Dist., 87 F.3d 190, 194

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(7th Cir. 1996) (explaining that in deciding motion for leave to amend, the

"court . . . should consider . . . whether the claim could have been added earlier"). Third, and relatedly, the district court was rightly and reasonably concerned about gamesmanship. The court considered that Engstrom and Shaw had "presented no excuse for omitting" their Title VII claims from the second amended complaint—in fact, even when United flagged this omission in opposing the proposed amendment, Engstrom and Shaw were silent in their reply. See McCoy, 760 F.3d at 687 (affirming denial where plaintiff failed to assert various theories in its earlier pleading and then, without explaining the delay, attempted to amend the pleading six months after the original was dismissed); Perrian, 958 F.2d at 195 (affirming denial where plaintiff "ha[d] not explained why he waited" three and a half months to add additional defendants). And the explanation they eventually gave when pressed by the district court—that the FCRA offered greater remedies than Title VII, which contains compensatory damages caps—"looks more like procedural gamesmanship than legitimate ignorance or oversight." McCoy, 760 F.3d at 687; see also Allen v. Brown Advisory, LLC, 41 F.4th 843, 854 (7th Cir. 2022) (considering that the proposed amendment "look[ed] more like an effort to keep [defendant] locked in litigation rather than an understandable delay beyond [plaintiff's] control"); Howe Military Sch., 227 F.3d at 990 ("[P]leading is not like playing darts: a plaintiff can't keep throwing claims at the board until she gets one that hits the mark.").

We also observe that the tactics used by the Plaintiffs here—intentionally and unnecessarily delaying the assertion of certain claims for strategic reasons—can be burdensome to the judicial system and can impair the "public's interest in speedy resolution of legal disputes." Perrian, 958 F.2d at 195. Such burdens "can justify a denial of a motion to amend 'even if the amendment would cause no hardship at all to the opposing party.'" Id. (quoting Tamari v. Bache & Co. S.A.L., 838 F.2d 904, 909 (7th Cir.

1998)).

In short, the district court properly considered the unique facts of this case, reasonably determined that the Plaintiffs should not be permitted to amend their complaint a third time, and did not stray from the law in doing so. We affirm.

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