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STAYINGACIVILACTIONINTHEFACEOFPENDINGOR THREATENEDCRIMINALPROSECUTION

AntonyM.Santos,Esq. 1 ItiswellestablishedthataCourtmaystayacivilactionpendingresolutionofacriminal actionwhentheinterestsofjusticerequiressuchaction.Acourtmaydecideinitsdiscretionto staycivilproceedings,postponecivildiscovery,orimposeprotectiveordersandconditionswhen theinterestsofjusticeseemtorequiresuchaction,sometimesattherequestoftheprosecution, sometimesattherequestofthedefense.SECv.Dresser,628F.2d1368,1375(D.C.Cir.1980), quoting United States v. Kordel, 397 U.S. 1, 12, (1970); Horne Brothers, Inc. v. Laird, 177, 463 F.2d1268,12711272(D.C.Cir.1972).TheCourtmustmakesuchdeterminationsinthelightof theparticularcircumstancesofthecase.SECv.Dresser,628F.2dat1375.TheCourtinSEC v. Dressercontinued: Other than where there is specific evidence of agency bad faith or maliciousgovernmentaltactics,thestrongestcasefordeferringcivil proceedingsuntilthecompletionofcriminalproceedingsiswherea partyunderindictmentforaseriousoffenseisrequiredtodefenda civil or administrative action involving the same matter. The non criminalproceeding,ifnotdeferred,mightunderminethepartys5th Amendment privilege against selfincrimination, expand rights of criminal discovery beyond the limits of Federal Rule of Criminal Procedure16(b),exposethebasisofthedefensetotheprosecution inadvanceofcriminaltrial,orotherwiseprejudicethecase.Ifdelay ofthenoncriminalproceedingwouldnotseriouslyinjurethepublic interest,acourtmaybejustifiedindeferringit. SECv.Dresser,628F.2dat13751376,citingUnitedStatesv.Henry,491F.2d702(6thCir.1974); Texaco, Inc. v. Borda, 383 F.2d 607, 608609 (3rd Cir. 1967); Silver v. McCamey, 221 F.2d 873, 874875(D.C.Cir.1955) The Ninth Circuit has also held that a Court may decide in its discretion to stay civil proceedings when the interest of justice seem to require such action. Keating v. Office of the ThriftSupervision,45F.3d322,324(9thCir.1995)quotingDresser,628F.2dat1375(quoting UnitedStatesv.Kordel,397U.S.1,12N.27,).TheCourtinKeatingheld: Thedecisionwhethertostaycivilproceedingsinthefaceofaparallel criminal proceeding should be made "in light of the particular circumstances and competing interests. involved in the case." [FederalSav.&LoanIns.Corp.v.Molinaro,889F.2d899,902(9thCir 1989)].Thismeansthedecisionmakershouldconsider"theextentto whichthedefendant'sFifthAmendmentrightsareimplicated."Id.In addition,thedecisionmakershouldgenerallyconsiderthefollowing
1Thismaterialwasdrafted,asoriginalworkproductorpreparedand/orcompiledbyAntonyM.Santos.Otherwise,everyeffort

hasbeenmadetocreditoriginalsourceswhereapplicable.
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factors: (1) the Interest of the plaintiffs in proceeding expeditiously with this litigation or any particular aspect of it, and the potential prejudicetoplaintiffsofadelay;(2)theburdenwhichanyparticular aspect of the proceedings may impose on defendants; (3) the convenience of the court in the management of its cases, and the efficient use of judicial resources; (4) the interests of persons not partiestothecivillitigation;and(5)theinterestofthepublicinthe pendingcivilandcriminallitigation.Id.at903. Keating, 45 F.3d at 324325; see also, SEC v. CMKM Diamonds, Inc., 2011 WL 1343004 (D.Nev.) (decidedApril7,2011). The substantially different rules that apply to discovery in civil and criminal cases are important reasons for staying civil discovery in cases where there are parallel criminal proceedings. Bridgeport Harbour Place I, LLC v. Ganim, 269 F.Supp 2d 6 (D.Conn. 2002) Depositionsofwitnessesandotherformsofcivildiscoverywillundoubtedlyprovideinformation not discoverable in the criminal case and shed light on Defendants strategies in defense of the criminalmatter.Therequestedstayofdiscovery,ontheotherhand,wouldmitigateagainstthe possibilityofsuchunfairoutcomes. Further, courts have held that in the example of [a] Rule 26(c) protective order, no matterhowbroaditsreach,providesnoguaranteethatcompelledtestimonywillnotsomehow finditswayintothegovernmentshandsforuseinsubsequentcriminalprosecution.Andover Data Services Division of Players Computer, Inc. v. Statistical Tabulating Corp., 876 F.2d 1080, 1083 (2nd Cir. 1989) (holding that a nonconsenting witness may not be forced to answer potentiallyincriminatingquestionsinrelianceuponaprotectiveorderstatingthathistestimony may not be provided to the government); United States v. Talco Construction, 153 F.R.D. 501, 514(W.D.N.Y.1994). Here,allofthefactorsconsideredbytheCourtssupportastayofthiscivilactionatleast until He is afforded a reasonable opportunity to secure the advice and counsel of competent criminal defense counsel. Accordingly, Mr. Blacks motion to stay this matter until expiration of 120 days should be granted. The sheer scope of the apparent investigation includes every deal everdonebyDunderMifflinorBlackforthepast15years.Thatwouldincludehundredsofdeals orloans. A. PLAINTIFF DOES NOT NEED TO PROCEED EXPEDITIOUSLY AND WILL NOT BE PREJUDICEDBYABRIEFDELAY

ThetrialisscheduledforOctober282013.Defendantwouldlikeanopportunitytoretain criminaldefensecounselsoasto determinewhetherornothemayfeelatlibertytotestifyand fully defend himself without invoking his Fifth Amendment Privilege against self incrimination. Defendants are each willing to stipulate to extend the deadline for trial thereby alleviating the detriment imposed by Nevadas FiveYear Rule. Clearly, under these circumstances, there is no prejudicetothePlaintiffsbyanominaldelayfortrial.Further,theallegationsinthiscivilaction pertaintoeventsdatingbackseveralyears,anddonotinvolveanyemergentissue. Further,thereisnoinconvenientdelayinthismatter.Where,however,theonlyburden on plaintiff isthe inconvenience ofdelay, the defendant's FifthAmendmentinterests or other undue hardship should prevail. Corbin v. Federal Deposit Ins. Corp., 74 F.R.D. 147, 149 50 (E.D.N.Y.1977).("Whileastay...maycausesomeinconvenienceanddelaytothe[government],
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protection of the defendant's constitutional rights against self incrimination is the more importantconsideration")(quotingDienstagv.Bronsen,49F.R.D.327,329(S.D.N.Y.1970)). Courtshavenotedthatinevaluatingtheplaintiffsburdenresultingfromthestay,courts may insist that the plaintiff establish more prejudice than simply a delay in her right to expeditiouslypursueherclaim.Maloneyv.Gordon,328F,Supp.2d508,512(D.Del.2004)(citing In re Adelphia Commons. Secs. Lit., 2003 U.S. Dist. LEXIS 9736 at 10 (ED. Pa. May 14, 2003). Prejudice results where the passage of time allows memories to fade, witnesses to relocate, or otherwisebecomeunavailableand"assetstodissipate.WalshSec.v.CristoProp.Mgmt.Ltd.,7 F.Supp.523,528(D.NJ.1998).ThereliefrequestedhereinbyBlackwillnotprejudicePlaintiffsin anywayotherthannecessitateabriefdelayintheconclusionofthismatter. Accordingly, in view of the absence of the necessity to proceed expeditiously with this litigationandtheabsenceofanypotentialprejudicetoPlaintiffs,Mr.BlacksMotionforStayofthis actionshouldbegranted. B. THEBURDENON,ANDPREJUDICETO,MR.BLACKWARRANTSASTAY If a defendant successfully demonstrates that he bears the risk of having evidence from the civil trial used against him in the criminal proceeding and/or the risk of being forced to expose the basis of his criminal defense to the government before the criminal trial, courts are inclinedtograntastayunlesstherearecountervailingintereststhatcompelthecourttoproceed expeditiously in the civil action. United States v. U.S. Currency, 626 F.2d 11, 17 (6th Cir. 1980) cert denied 449 U.S. 993 (1980) (sustaining a stay granted in pre indictment forfeiture proceeding); Texaco, Inc. v Borda, 383 F.2d 607 (3d Cir. 1967) (sustaining a stay of a private antitrust suit pending the resolution of criminal proceedings); Brock v. Tolkow, 109 F.R.D. 116 (E.D.N.Y.1985)(stayingalldiscoveryincivilcasependingoutcomeofpossiblecriminalactions); Perryv.McGuire,36F.R.D.272(S.D.N.Y.1964).Otherwise,adefendantmaybeforcedinto"the uncomfortable position of having to choose between waiving [his] Fifth Amendment right or effectivelyforfeitingthecivilsuit."VolmarDistributors,Inc.v.TheNewYorkPostCo.,Inc.,152 F.R.D.36,39(S.D.N.Y.1993).Here,Mr.Blackwillbeputinthepositionofhavingtoasserthis5th Amendmentprivilegeandtherebyeffectivelyforfeitingdefensesinthisaction. InDienstagv.Bronsen,49F.R.D.327(S.D.N.Y.1970),defendantsinacivilsecuritiesfraud case were indicted for violation of provisions of the federal securities laws. Defendants, having been noticed for deposition, moved for a stay of the deposition under (former) Rule 30. Defendantsallegedthat,absentastay,theywouldbecompelled,ontheadviceofcounsel,toassert theirFifthAmendmentprivilegeagainstselfincriminationinordertoavoiddisclosingdefensesto thecriminalcharges,ortootherwiseincriminatethemselves.Plaintiffsansweredthismotionby stating that no evidence was being supplied to the government and that, at the very least, the disclosuresinthedepositioncouldbeheldconfidential.Thecourt,whilerecognizingthenegative aspects of delaying the civil proceeding, granted the stay until completion of the criminal trial, statingthat"[w]hilethiswillundoubtedlycauseinconvenienceanddelaytoplaintiffs,protection of defendants constitutional rights against selfincrimination is the more important consideration."Id.at329. Moreover,Courtshaveoftengrantedpreindictmentstaysofcivilactionswhenrequested bytheGovernmentinordertoprotecttheintegrityofthecriminalinvestigations.SECv.Downe, 1993 U.S. Dist. LEXIS 753 (S.D.N.Y.) (U.S. Attorney granted stay during criminal investigation); Board of Governors of the Federal Reserve System v. Pharaon, 140 F.R.D. 634 (S.D.N.Y. 1991) (NewYorkD.A.grantedstayduringgrandjuryproceeding);UnitedStatesv.HugoKeyandSon,
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Inc., 672 F. Supp.656(D.R.I.1987)(stayingcivilactionwhileDepartment of Justice considered bringing criminal proceeding); SEC v. Control Metals Corp., 57 F.R.D. 56 (S.D.N.Y. 1972) (SEC granted stay during grand jury proceeding). There is no reason that Mr. Blacks interest in ensuringhisrighttofairproceedingsshouldnotbetheequivalentoftheGovernmentsinterest inprotectingtheintegrityofitsinvestigation. The burden on the defendant is also of critical importance. Initially, a trier of fact may construe the invoking defendant's silence against him. This is not only severely prejudicial, in many instances it will result in the automatic entry of judgment against the defendant. If the defendantdecidestowaivehisorherFifthAmendmentrights,thedecisionisirrevocable.While thiswillenablethedefendanttorebutthecivilcharges,anystatementsmadeinadepositionor in court can and will be used by the prosecution in the criminal proceedings. Moreover, the discovery and trial process allows the prosecuting agency to access information to which it might not otherwise be entitled under the applicable rules of criminal procedure. If the defendant transparently seeks a stay for tactical reasons, the court is far less likely to grant relief. The prejudice suffered by the defendant will far outweigh the inconvenience to the plaintiff,warrantingatleastsomeformoflimitedrelief.AgoodillustrationisthecaseofGrayv. Derderian,2007USDistLexis58427at45(DRIAugust3,2007),pendingintheUnitedStates District Court for the District of Rhode Island. In Gray, the District Court of Rhode Island applied the multifactor test and initially issued a stay suspending discovery as to certain defendants who faced prosecution in pending parallel criminal proceedings. The court eventually granted the plaintiffs' motion to lift the stay, but only after these defendants pled guiltytothecriminalchargesandwerenolongersubjecttofurtherprosecution.SeeId.at53, 54. InUnitedStatesv.CertainRealProperty&Premises,751F.Supp.1060(E.D.N.Y.1989),the Courtgrantedastayofcivilforfeitureproceedingsastoallthreedefendantswhereanindictment hadbeenissuedagainstonlyoneofthemovingdefendants.There,theCourtheldthatastayasto thetwodefendants,whowereunderathreatofbeingindictedthatwasmorethan"fanciful"or "imaginary" was warranted because there existed a "'realistic threat of' incrimination'" beyond "'a mere imaginary possibility'"Id.at1063(quotingU.S.v.U.S.Currency,626F.2dat 14)(Emphasisadded.) Moreover,Mr.Blackmaysufferundueprejudiceifheisforcedtodefendthisactionashe mayberequiredtoasserthis5thAmendmentprivilegetherebypermittingthetrieroffact,inits discretion, to draw an adverse inference. Baxter v. Palmigiano, 425 U.S. 308 (1976). Without a stay, Mr. Black will be prejudiced by being forced to litigate without the ability to prepare or mountadefensetotheseriousallegations. This action and the impending criminal action contain allegations of alleged similar wrongdoing. Both actions stem from allegations made by Plaintiffs and others as to the same issues,factsandcircumstances.Bothactionswouldhavecommonwitnesses.Thetrialislikelyto result in testimony from Mr. Black going to the very heart of Mr. Blacks business dealings, affiliations,sourcesofincome,etc.,whichwilllikewisegototheveryheartoftheallegationsinthe pending criminal investigation. There is an unavoidable overlap between the criminal investigationandthisaction.Thus,theprejudicetoMr.Blackisclearlysubstantial. Finally,absentastay,Mr.Blackwillbeprejudicedduetohisinabilitytodevotehisfulltime andattentiontowardsthecriminaltrial.Absentastay,Mr.Blackwouldberequiredtoparticipate in discovery in this civil action at the same time he is seeking, securing and apprising recently retainedlegalcounseltoaddressthecriminalinvestigation.Underthecompellingcircumstances
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presentedhere,itwouldbeunfair,unjustandprejudicialtoMr.Blacktorequirehimtoactively participateinthistrialwhileatthesametimehepreparestoaddressthecriminalinvestigation. Accordingly,Mr.BlacksMotiontoStaythisactionshouldbegranted. C. THE INTERESTS OF THE COURT FAVOR A STAY Judicialefficiencyalsoweighsinfavorofgrantingastay.Thisisnotaninstancewhere criminalprosecutionismerelyconjectural.ASupersedingIndictmentwasissued.Thecriminal actionisproceedingandisscheduledfortrialonJanuary24,2012.Hence,thisactionwould notbestayedindefinitely,butrathermerelyforabriefperiodoftime. If the civil action is stayed until the conclusion of the criminal proceedings, then it obviatestheneedtomakerulingsregardingpotentialdiscoverydisputesinvolvingissuesthat mayaffectthecriminalcase.Maloneyv.Gordon,328F.Supp.2d508,513(D.Del.2004)(citing CognexCorp.v.Natl.InstrumentsCorp.,2001U.S.Dist.LEXIS25555,(D.Del.June29,2001); Javier H v. Garcia Botello, 218 F.R.D. 72, 75 (WD.N.Y. 2003) ("By proceeding first with the criminalprosecution,theCourtmakesefficientuseofjudicialtimeandresourcesbyinsuring that common issues of fact will be resolved and subsequent civil discovery will proceed unobstructedbyconcernsregardingselfincrimination").Infact,theoutcomeofthecriminal proceedingsmayguidethepartiesinsettlementdiscussionsandpotentiallyeliminatetheneed tolitigatesomeoralloftheissuesinthecase.Maloney,328F.Sup.2dat513(D.Del.2004). Finally,courtscanalleviateconcernsaboutindefinitestaybyallowingthepartiestopetition the Court to lift or modify the stay if there is a change in circumstances warrant it. Walsh Securities,Inc.v.CristoProp.Mgmt.Ltd.,7F.Supp.at529citingBrockv.Tolkow,109F.R.D. 116,121(E.D.N.Y.1985). Furthermore,resolutionofthecriminaltrialandastayofthecivilactionmaynarrowor eliminate factual issues in the civil case. In re Grand Jury Proceedings (Williams), 995 F2d 1013, 1018 N.11 (11th Cir. 1993) (Although stays delay civil proceedings, they may prove usefulasthecriminalprocessmaydetermineandnarrowtheremainingcivilissues.);United States v. Mellon Bank, 545 F2d 869, 873 (3rd Cir. 1976) (affirming a stay of discovery and stating it might well have been that resolution of the criminal case would moot, clarify or otherwiseaffectvariouscontentionsinthecivilcase.).Brockv.Tolkow,109F.R.D.116,119 120 (E.D.N.Y. 1985) (In granting stay court noted that the resolution of the criminal case mightreducethescopeofdiscoveryinthecivilcaseorotherwisesimplifytheissues.).Here, theCourtsvaluabletimeandresourcesmaybepreservedbythenarrowingofissuesresolved duringthecriminalcase. Significantly, it is in the interest of the Court and judicial economy to grant the relief requested. D. A STAY WILL ADVANCE PUBLIC INTERESTS AND WILL NOT PREJUDICE THE INTERESTOFPERSONSNOTPARTIESTOTHISLITIGATION

InBrockv.Tolkow,109F.R.D.116(E.D.N.Y.1985),theCourtgrantedastayofacivilaction allegingviolationoffiduciaryobligationsunderERISA,pendingtheoutcomeoftheinvestigationof the Department of Justice. The Court found that a stay would cause no serious damage to the publicinterestandwouldenablethedefendantstodefendthecivilcasevigorouslywithoutfearof subsequent prosecution. Id. at 12021 ("the risk of harm to the public interest in correcting improprieties in the management of employee benefit plans does not outweigh the distinct possibilitythatdefendantswillbeunabletodefendbothactionstothefullest.).Likewise,here,a staywouldnotharmthepublicinterestandwouldenableMr.Blacktodefendthisaction.
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Significantly,theallegationsinthecivilactionpertaintoeventsthatallegedlyoccurredin 2006, over 5 years ago. No emergent relief is sought by the Plaintiffs. There is no harm to the publicbyabriefstay. The compelling public interest in facilitating enforcement of the criminal laws and the fundamentaldifferencesbetweencivilandcriminalproceedingsgiverisetotheneedforastayof thiscivilaction.AsstatedbytheFifthCircuitinCampbellv.Eastland,307F2d478(5thCir.1962), The very fact that there is a clear distinction between civil and criminal actions requires a government policy determination of priority:whichcaseshouldbetriedfirst.Administrativepolicygives priority to the public interest in law enforcement. This seems so necessaryandwisethatatrialjudgeshouldgivesubstantialweightto it in balancing the policy against the right of a civil litigant to a reasonablypromptdeterminationofhiscivilclaimsorliabilities. See also, In re Ivan Boesky Securities Litigation, 128 F.R.D. 47, 49 (S.D.N.Y. 1989) (The public interestinthecriminalcaseisentitledtoprecedenceoverthecivillitigant.). Moreover, the interests of nonparties are served by a stay of discovery that avoids prejudicetothecriminalcase,preservesjudicialresourcesandaffordsMr.Blacktheopportunity forafairtrialinboththecivilandcriminalcases. Thus, the interests of the public, the government, the parties and the Court strongly weighinfavorofstayingthisaction.Accordingly,DefendantBlacksmotionshouldbegranted. E. CONCLUSION Basedontheforegoing,itisrespectfullyrequestedthatDefendantBlacksMotiontoStay thisactionuntilexpirationofatleast120daysbegrantedsothatDefendantmaybeaffordedthe opportunityto(1)securecriminaldefensecounsel,(2)conferwithsame;(3)affordsaidcounsel theopportunitytoreviewthescopeandcircumstancesofthependingcriminalinvestigationand review documents germane thereto; and (4) afford said counsel the time and opportunity to adviseMr.Blackas towhetheror not heshould avail himself ofhisFifthAmendmentRights at trialintheinstantmatter.

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