Securities and Exchange Commission v. Choice Advisors, LLC

Opinion

2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 SECURITIES AND EXCHANGE Case No.: 21cv1669-JO(MSB) COMMISSION, 12 ORDER GRANTING UNOPPOSED Plaintiff, 13 MOTION TO CONTINUE EARLY NEUTRAL v. EVALUATION AND RELATED DATES 14 CHOICE ADVISORS, LLC, et al., 15 Defendants. 16 17 18 On October 6, 2022, Defendants Choice Advisors, LLC and Matthias O’Meara filed 19 an “Unopposed Motion to Continue Early Neutral Evaluation and Related Dates.” (ECF 20 No. 25.) They ask the Court to continue the Early Neutral Evaluation (“ENE”) from 21 November 1, 2022, until November 30, December 1, or December 2, 2022. (Id. at 2.) In 22 support, the Movants state that their counsel has a scheduling conflict on the date of 23 the ENE because he “will be in trial as lead counsel for an in-person FINRA arbitration 24 from October 31 through November 4, 2022 in Denver, Colorado.” (ECF No. 25-1, Decl. 25 at 2.) The Movants further state that the arbitration has been set since May 5, 2022. 26 (Id.) Finally, the Movants assert that they conferred with opposing counsel and “all 27 necessary parties are available for ENE and case management conference on November 2 Court GRANTS the motion. Accordingly, the Court CONTINUES the ENE and Case 3 Management Conference currently scheduled for November 1, 2022, at 9:30 a.m. until 4 December 2, 2022, at 1:30 p.m. The ENE will be held in the chambers of the Honorable 5 Michael S. Berg, United States Magistrate Judge, located at 221 West Broadway, 6 second floor, San Diego, California, 92101. All discussions at the ENE Conference will 7 be informal, off the record, privileged, and confidential. Counsel for any non-English 8 speaking party is responsible for arranging for the appearance of an interpreter at the 9 conference. The following rules and deadlines apply: 10 1. Personal Appearance of Parties Required: All named parties, party 11 representatives, including claims adjusters for insured defendants, as well as the 12 principal attorney(s) responsible for the litigation, must be present in person and legally 13 and factually prepared to discuss and resolve the case. Counsel appearing without their 14 clients (whether or not counsel has been given settlement authority) will be cause for 15 immediate imposition of sanctions and may also result in the immediate termination of 16 the conference. 17 2. Full Settlement Authority Required: A party or party representative with 18 full settlement authority1 must be present at the conference. Retained outside 19 corporate counsel shall not appear on behalf of a corporation as the party 20 representative who has the authority to negotiate and enter into a settlement. A 21 government entity may be excused from this requirement so long as the government 22 23 1 “Full settlement authority” means that the individuals at the settlement conference must be 24 authorized to fully explore settlement options and to agree at that time to any settlement terms 25 acceptable to the parties. Heileman Brewing Co. v. Joseph Oat Corp., 871 F.2d 648, 653 (7th Cir. 1989). The person needs to have “unfettered discretion and authority” to change the settlement position of a 26 party. Pitman v. Brinker Int’l, Inc., 216 F.R.D. 481, 485–86 (D. Ariz. 2003). The purpose of requiring a person with unlimited settlement authority to attend the conference contemplates that the person’s 27 view of the case may be altered during the face to face conference. Id. at 486. A limited or a sum 2 (2) authority to negotiate and recommend settlement offers to the government 3 official(s) having ultimate settlement authority. 4 3. Confidential ENE Statements Required: No later than November 25, 2022, 5 the parties shall submit directly to Magistrate Judge Berg’s chambers (via hand delivery 6 or by e-mail to the Court at efile_berg@casd.uscourts.gov), confidential settlement 7 statements. The ENE statement is limited to five (5) pages or less, and up to five (5) 8 pages of exhibits or declarations. Each party’s ENE statement must outline (1) the 9 nature of the case and the claims, (2) position on liability or defense, (3) position 10 regarding settlement of the case with a specific demand/offer for settlement, and 11 (4) any previous settlement negotiations or mediation efforts. 12 If a party cannot make a specific demand or offer at the time the ENE statement is 13 submitted, then it must state why a demand or offer cannot be made. Further, the 14 party must explain when they will be prepared to state a demand or offer. General 15 statements such as a party will “negotiate in good faith” is not a specific demand or 16 offer. The ENE statement should be submitted confidentially and need not be shared 17 with other parties. 18 4. New Parties Must be Notified by Plaintiff or Plaintiff’s Counsel: Plaintiff’s 19 counsel shall give notice of the ENE to parties responding to the complaint after the 20 date of this notice. 21 5. Case Management Conference: If the case does not settle during the ENE, 22 the Court will conduct a Case Management Conference. In preparation for this 23 conference, the parties must do the following: 24 a. Meet and confer pursuant to Fed. R. Civ. P. 26(f) no later than 25 November 18, 2022; 26 b. File a Joint Discovery Plan no later than November 25, 2022.

27 Agreements made in the Joint Discovery Plan will be treated as binding stipulations that 2 for each item identified in Fed. R. Civ. P. 26(f)(3). In addition, the Joint Discovery Plan 3 must include the following: 4 i. Service: A statement as to whether any parties remain to be 5 served and, if so, a proposed deadline for service; 6 ii. Amendment of Pleadings: The extent to which parties, claims, or 7 defenses are expected to be added or dismissed and a proposed deadline for amending 8 the pleadings; 9 iii. Protective Order: Whether a protective order is contemplated to 10 cover the exchange of confidential information and, if so, the date by which the 11 proposed order will be submitted to the Court; 12 iv. Privilege: The procedure the parties plan to use regarding claims 13 of privilege and whether an order pursuant to Fed. R. Evid. 502 will be sought; 14 v. Evidence Preservation: Whether the parties have discussed 15 issues related to the preservation of relevant evidence and if there are areas of 16 disagreement, how the parties are resolving them; 17 vi. Electronic Discovery: In addition to the requirements set forth in 18 Fed. R. Civ. P. 26(f)(3)(C), the parties must describe their agreements regarding 19 methodologies for locating and producing electronically stored information and the 20 production of metadata, and must identify any issues or agreements regarding 21 electronically stored information that may not be reasonably accessible (See Fed. R. Civ. 22 P. 26(b)(2)(B)); 23 vii. Discovery: In addition to the requirements of Fed. R. Civ. P. 24 26(f)(3)(B), the parties must describe the discovery taken to date (if any), any proposed 25 limitations or modifications of the discovery rules, and any identified discovery disputes; 26 and 27 viii. Related Cases: Any related cases or proceedings pending before 1 C. Exchange initial disclosures pursuant to Rule 26(a)(1)(A-D) no later than 2 || November 25, 2022. 3 6. Requests to Continue an ENE Conference: Local Rule 16.1(c) requires that 4 ENE take place within forty-five (45) days of the filing of the first answer. Requests to 5 || continue ENEs are rarely granted. An ENE may be rescheduled only upon a showing of 6 || good cause and adequate notice to the Court. Absent good cause, requests for 7 || continuances will not be considered unless submitted in writing no fewer than seven 8 calendar days prior to the scheduled conference. 9 IT IS SO ORDERED. 10 || Dated: October 6, 2022 _ = _ 2 FF D Honorable Michael S. Berg United States Magistrate Judge 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28