Bensch v. Estate of Umar, 2 F.4th 70

Petitioner Christopher Bensch, owner/operator of a 46' pleasure boat, filed a limitation/exoneration action after his vessel struck and killed Ahmed Umar, who fell from a rented jet ski.
Umar’s widow sued Bensch (and Waikiki Watercraft) in state court for wrongful death; Bensch filed a federal limitation action under the Limitation of Liability Act and Supplemental Rule F.
Bensch’s initial complaint alleged Umar’s negligence and conclusorily asserted that any damage occurred without Bensch’s privity or knowledge; it lacked factual allegations showing absence of Bensch’s fault.
Claimants moved to dismiss under Rule 12(b)(6). The district court, adopting the magistrate judge’s report, dismissed the complaint under the Twombly/Iqbal plausibility standard and denied leave to amend (first as futile; second on futility and bad faith).
Bensch’s Second Proposed Amended Complaint added facts: he was an experienced operator, kept a lookout, his vessel was properly equipped, he observed Umar’s erratic turn, and he took evasive action.
The Second Circuit held Supplemental Rule F(2) requires the same plausibility pleading standard as Rule 8(a) (Twombly/Iqbal), affirmed dismissal of the initial complaint and denial of the first amendment, but reversed the denial of leave to file the Second Proposed Amended Complaint (futility and bad‑faith denials were erroneous) and remanded.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether maritime limitation/exoneration complaints under Supplemental Rule F(2) are governed by the Twombly/Iqbal plausibility standard	Bensch: supplemental admiralty practice permits conventional, short-form admiralty wording; Conley-era notice pleading suffices; Colonial Sand supports a relaxed maritime standard	Claimants: Rule F incorporates Rule 8(a); Twombly/Iqbal require factual allegations making lack of privity/knowledge plausible	Court: Rule 8(a) as interpreted in Twombly/Iqbal applies; Rule F(2) is consistent with the plausibility requirement
Whether denial of leave to amend (Second Proposed Amended Complaint) for futility or bad faith was proper	Bensch: proposed second amendment added specific factual allegations rendering lack of fault plausible; amendment was in good faith	Claimants: amendment was untimely, facts were in Bensch’s knowledge and should have been pled earlier; counsel acted in bad faith	Court: Second Proposed Amended Complaint was not futile and sufficiently pled plausibly; denial for futility and bad faith was an abuse of discretion; leave to amend should have been granted

Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (replaced Conley notice pleading with the plausibility standard)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (clarified that courts need factual content to draw reasonable inference of entitlement to relief)
Colonial Sand & Stone Co. v. Muscelli, 151 F.2d 884 (2d Cir. 1945) (historical admiralty pleading decision treating admiralty pleadings like ordinary civil pleadings of its era)
Conley v. Gibson, 355 U.S. 41 (1957) (articulated pre-Twombly notice-pleading standard)
Complaint of Dammers & Vanderheide & Scheepvaart Maats Christina B.V., 836 F.2d 750 (2d Cir. 1988) (discusses Limitation of Liability Act and owner absentee rationale)
Lake Tankers Corp. v. Henn, 354 U.S. 147 (1957) (context on Limitation of Liability Act policy)
The Ariadne, 80 U.S. 475 (1871) (classic admiralty law on duties like maintaining a proper lookout)
Blackler v. F. Jacobus Transp. Co., 243 F.2d 733 (2d Cir. 1957) (privity and knowledge defined as complicity in the fault causing the accident)
Starr v. Sony BMG Music Ent., 592 F.3d 314 (2d Cir. 2010) (standard of review for district court denial of leave to amend)
Shimon v. Equifax Info. Servs. LLC, 994 F.3d 88 (2d Cir. 2021) (de novo review applicable to denials based on futility)