Michael H. Resh et al v. China Agritech, Inc. et al

Filing 53

MINUTE ORDER IN CHAMBERS by Judge R. Gary Klausner Re: Plaintiffs' Motion for Reconsideration 45 . The Court DENIES Plaintiffs' Motion. Refer to the Court's order for details. (pso)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

CV 14-05083 RGK (PJWx)

Title

RESH, et al. v. CHINA AGRITECH, INC., et al.

Present: The
Honorable

Date

February 23, 2015

R. GARY KLAUSNER, U.S. DISTRICT JUDGE

Sharon L. Williams (Not Present)

Not Reported

N/A

Deputy Clerk

Court Reporter / Recorder

Tape No.

Attorneys Present for Plaintiffs:

Attorneys Present for Defendants:

Not Present

Not Present

Proceedings:

I.

(IN CHAMBERS) Order Re: Plaintiffs’ Motion for Reconsideration (DE
45)

INTRODUCTION

On September 4, 2014, Michael H. Resh, William Schoenke, Heroca Holding B.V., and Ninella
Beheer B.V. (collectively, “Plaintiffs”) filed an Amended Class Action Complaint (“FAC”) against
China Agritech, Inc. (“China AG”) and members of the company’s executive management team and
board of directors (“Individual Defendants”). Plaintiffs alleged violations of: (1) Section 10(b) of the
Securities Exchange Act of 1934 (the “Exchange Act”) and Securities and Exchange Commission
(“SEC”) Rule 10b-5 against China AG and Individual Defendants; and (2) Section 20(a) of the
Exchange Act against Individual Defendants. Among the Individual Defendants named in the FAC was
Charles Law (“Law”).
Plaintiffs brought this class action on behalf of all persons and entities who purchased the
publicly traded common stock of China AG between November 12, 2009 and March 11, 2011. Class
actions on behalf of classes identical to that in the present case had been filed with this Court on two
prior occasions, in actions entitled Dean v. China Agritech, Inc., No. CV 11-01331-RGK (PJWx) (C.D.
Cal. filed Feb. 11, 2011), and Smyth v. Yu Chang, No. CV 13-03008-RGK (PJWx) (C.D. Cal. filed Apr.
19, 2012).
On September 22, 2014, China AG and Law filed motions to dismiss the FAC. On December 1,
2014, the Court granted both motions without leave to amend on the ground that Plaintiffs’ class action
claims were barred by the statute of limitations. (See ECF No. 43.)
Presently before the Court is Plaintiffs’ Motion for Reconsideration (the “Motion”). For the
following reasons, the Court DENIES the Motion.

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II.

JUDICIAL STANDARD

Pursuant to Federal Rule of Civil Procedure 59(e), a “motion to alter or amend a judgment must
be filed no later than 28 days after the entry of judgment.” A court should grant the motion “sparingly in
the interests of finality and conservation of judicial resources.” Kona Enters., Inc. v. Estate of Bishop,
229 F.3d 877, 890 (9th Cir. 2000). Thus, “amendment or alteration is appropriate . . . if (1) the district
court is presented with newly discovered evidence, (2) the district court committed clear error or made
an initial decision that was manifestly unjust, or (3) there is an intervening change in controlling law.”
O2 Micro Int’l Ltd. v. Monolithic Power Sys., Inc., 420 F. Supp. 2d 1070, 1075 (N.D. Cal. 2006).
California Local Rule 7-18 provides that a motion for reconsideration may be made only on the
grounds of:
(a) a material difference in fact or law from that presented to the Court before
such decision that in the exercise of reasonable diligence could not have been
known to the party moving for reconsideration at the time of such decision, or (b)
the emergence of new material facts or a change of law occurring after the time of
such decision, or (c) a manifest showing of a failure to consider material facts
presented to the Court before such decision. No motion for reconsideration shall
in any manner repeat any oral or written argument made in support of or in
opposition to the original motion.
C.D. Cal. L.R. 7-18.
A “motion for reconsideration must accomplish two goals. First, a motion for reconsideration
must demonstrate reasons why the court should reconsider its prior decision. Second, a motion for
reconsideration must set forth facts or law of a strongly convincing nature to induce the court to reverse
its prior decision.” Francis v. Bryant, CV F 04 5077 AWI, 2006 WL 1627917, at *1 (E.D. Cal. June 7,
2006) (citing Donaldson v. Liberty Mut. Ins. Co., 947 F. Supp. 429, 430 (D. Haw. 1996)). A motion for
reconsideration should not be used to reargue the motion or present evidence that should have been
presented prior to the entry of judgment. Marlyn Nutraceuticals, Inc. v. Mucos Pharma GmbH & Co.,
571 F.3d 873, 880 (9th Cir. 2009) (citations omitted).
III.

DISCUSSION
Plaintiffs base their Motion for Reconsideration on four grounds. The Court addresses each in

turn.
A.

Tolling of Individual Claims

First, Plaintiffs assert that the Court failed to consider the material “fact” that Plaintiffs’
individual claims are tolled and not barred by the statute of limitations. Even assuming this qualifies as a
“fact” under subsection (c) of Local Rule 7-18, the Court did not fail to consider it. To the contrary, the
Court noted the Ninth Circuit’s holding in Robbin v. Fluor Corporation, 835 F.2d 213, 215 (9th Cir.
1987), that tolling applies to an individual action even though the class action is barred. (See ECF No.
43 at 4 n.1.) In keeping with that holding, the Court held that “the statute of limitations did not toll as to
a class action during the pendency of the Dean or Smyth actions,” and dismissed “Plaintiffs’ class action
Complaint with prejudice.” (Id. at 6 (emphasis added).) As the Court noted in its order dated January 7,
2015, “Plaintiffs are not prevented from filing a complaint asserting individual, rather than class action,
claims against [the defendants] if they so choose.” (ECF No. 50.)
B.
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Plaintiffs next argue that the Court erred in finding that it denied class certification in the Dean
action on the ground that the claims were not suitable for class treatment. In their opposition to China
AG’s motion to dismiss, Plaintiffs maintained that unless class certification was denied on that ground,
rather than due to issues related to the lead plaintiff’s suitability as class representative, Plaintiffs’
claims were not time-barred.
Yet Plaintiffs simply seek to reargue an issue they already briefed in their opposition. (See, e.g.,
ECF No. 35 at 7:5-8:19, 9:13-10:9, 12:12-15:18.) This is improper, as “[a] motion for reconsideration is
not a vehicle to reargue the motion.” Brown v. U.S., Nos. CV 09-8168 ABC, CR 03-847 ABC, 2011 WL
333380, at *3 (C.D. Cal. Jan. 31, 2011) (quotations omitted). To the extent Plaintiffs point to excerpts of
the Court’s orders in Dean or Smyth which Plaintiffs did not explicitly quote in their opposition, they
impermissibly “present evidence for the first time when [it] could reasonably have been raised earlier in
the litigation.” Marlyn Nutraceuticals, 571 F.3d at 880. Moreover, Plaintiffs do not make a “manifest
showing” that the Court failed to consider the language they cite. To the contrary, the Court did consider
that language; Plaintiffs simply disagree with the Court’s holding.
Also, the Court’s holding on this issue was an alternative basis for its decision. The primary
holding was that Plaintiffs’ class action claims were time-barred regardless of the grounds on which
class certification was denied in the two earlier actions. (See ECF No. 43 at 4-5.) Thus, even if
Plaintiffs’ argument had merit (it does not), it would not provide a basis for the Court to alter or amend
the judgment.
C.

Plaintiffs’ Citation to Robbin v. Fluor Corp.

Plaintiffs take issue with the Court’s statement that “Plaintiffs do not address Robbin [v. Fluor
Corporation, 835 F.2d 213 (9th Cir. 1987)].” (ECF No. 43 at 4.) Plaintiffs point out that they did
reference Robbin at the end of their opposition to China AG’s motion, in a section addressing China
AG’s public policy arguments. (See ECF No. 35 at 19:19-20:17.)
However, read in context, the Court’s statement highlighted the fact that Plaintiffs did not
address Robbin in analyzing the Ninth Circuit’s application of the two seminal Supreme Court cases
addressing tolling in the class action context, American Pipe & Construction Company v. Utah, 414
U.S. 538 (1974), and Crown, Cork & Seal Company v. Parker, 462 U.S. 345 (1983). Instead, Plaintiffs
skipped over that case, which the Court found to be on point, and cited to the Ninth Circuit’s later
decision in Catholic Social Services v. I.N.S., 232 F.3d 1139 (9th Cir. 2000). (See ECF No. 35 at 12:1215:10.) Further, Plaintiffs’ attempt to distinguish Robbin near the end of their opposition was part of an
argument that the Court considered and rejected - that Plaintiffs were not attempting to relitigate earlier
denials of class certification. (See id. at 20:5-17; ECF No. 43 at 5-6.)
Therefore, Plaintiffs have not shown that the Court failed to consider a material fact, and the
Court’s statement regarding Plaintiffs’ opposition is not a basis for altering or amending the judgment.
D.

Natan v. Citimortgage, Inc.

Finally, Plaintiffs argue that Natan v. Citimortgage, Inc., CV 14-5779 DSF, 2014 U.S. Dist.
LEXIS 143280 (C.D. Cal. Oct. 1, 2014), supports their argument that the statute of limitations was
tolled as to their class action claims. However, Natan was issued five (5) days before Plaintiffs filed
their oppositions on October 6, 2014, and thus does not qualify as “a material difference in . . . law that
in the exercise of reasonable diligence could not have been known” to Plaintiffs, or “a change of law
occurring after” the Court’s decision. See C.D. Cal. L.R. 7-18(a), (b).
Additionally, Natan addressed the circumstances in which an individual claim should be tolled
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due to the pendency of a class action. It did not address the tolling of subsequent class action claims.
Natan, 2014 U.S. Dist. LEXIS 143280, at *2-4. Therefore, Natan does not support Plaintiffs’ argument,
and certainly does not warrant altering or amending the judgment.
IV.

CONCLUSION
For the foregoing reasons, the Court DENIES Plaintiffs’ Motion.

IT IS SO ORDERED.
:
Initials of Preparer

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