Judge rules fraud claim cannot be added to Atlantic Holding's lawsuit

By Karen Kidd | Nov 20, 2018

United States District Judge Joseph F. Leeson Jr.  

PHILADELPHIA — A federal judge has ruled a holding company based in India cannot add a fraud claim and name additional defendants in its groundwater contamination dispute against a Bethlehem metal electroplating company expected to go to trial in December.

Atlantic Holding Ltd., which owns property in Bethlehem next to that of Apollo Metals Ltd., waited too long to expand its litigation, U.S. District Judge Joseph Leeson Jr., on the bench in Pennsylvania's Eastern District, said in his 12-page opinion issued Nov. 7.

"Granting Atlantic's amended motion to amend the complaint would necessitate more than just additional discovery," Leeson said in his order. "One need look no further than Atlantic's own counsel's request for an amendment to the scheduling order to see the obvious prejudice that would result from allowing amendment because the current trial date of Dec. 26, 2018 does not allow sufficient time for either Atlantic or any of the Defendants to adequately prepare evidence for presentation at trial concerning the revised allegations of the amended complaint."

Atlantic wanted to add Tata Steel Group to the list of defendants Atlantic alleges are responsible for contamination on its property adjoining Apollo Metals.


"Atlantic offers no cogent reason as to why it delayed in amending the complaint," Leeson said in his order. "In its Reply, Atlantic argues that it only 'recently' became aware of a sign indicating that Tata Steel is doing business at Apollo's property and provides no compelling justification for why it delayed in reviewing documents that allegedly support adding Tata Steel as a defendant which were provided in connection with Atlantic's investigation of the contamination of its property."

Atlantic began its litigation against Apollo Metals in October 2014 when it filed its first complaint in Lehigh County Common Pleas Court, a case Atlantic voluntarily discontinued, according to the background portion of Leeson's order. Atlantic then filed a complaint in Pennsylvania's Eastern District, alleging Apollo Metal had released pollutants that made their way onto Atlantic's neighboring property via groundwater.

Atlantic claims the groundwater contamination reduced the value of its Bethlehem property.

Settlement discussions between Atlantic and Apollo Metals were unsuccessful and the later ultimately filed counterclaims.

Atlantic filed its motion to amend scheduling in October, asking for a deadline extension to produce expert reports because an Atlantic consultant's "newly identified methodology" about contamination impacts. Atlantic's motion also requested the trial date be extended to allow "any potential additional defendants" to prepare for revised allegations in an amended complaint.

In his order, Leeson took particular issue with Atlantic's 11th-hour request to add fraud claims to its litigation, saying the new claims "would cause undue prejudice" to the already named defendants in the case.

"Atlantic's new fraud claim introduces an entirely new set of facts into the case and would require further investigation into Atlantic's reliance on the allegedly fraudulent report to the Pennsylvania Department of Environmental Protection and the harm caused by this report," the order said. "Moreover, Atlantic even describes the report to contain 'technical data and information' that is 'voluminous.' Clearly, the fraud claim introduces an entirely new and voluminous set of facts into the case over which the parties already disagree."

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Pennsylvania Department of Environmental Protection U.S. District Court for the Eastern District of Pennsylvania

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