Sundby v. Marquee Funding Group, Inc. et al

Filing 244

ORDER Overruling Plaintiff's 240 Objection to Scheduling Order. Signed by Judge Gonzalo P. Curiel on 1/7/21.(dlg)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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DALE SUNDBY, Trustee,

Case No.: 19-cv-390-GPC-AHG
Plaintiff,

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v.

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ORDER OVERRULING
PLAINTIFF’S OBJECTION TO
SCHEDULING ORDER

MARQUEE FUNDING GROUP, INC., et
al.,

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Defendants.

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[ECF No. 240]

Plaintiff has filed an Objection to the Court’s January 4, 2021 Scheduling Order

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and also submitted a Supplemental Brief in support of the Objection. ECF Nos. 240, 243.

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For the reasons stated below, the Court OVERRULES Plaintiff’s Objection to the

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Scheduling Order.

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BACKGROUND
On December 9, 2020, Plaintiff filed an Ex Parte Motion for an order on TILA

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damages. ECF No. 230. In the Ex Parte Motion, “Plaintiff respectfully requests that the

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Court deny Lender Defendants any right to present ‘affirmative defenses against 15

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U.S.C. § 1640 liabilities,’ and declare that Lender Defendants are liable for TILA

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damages for the undisputed amounts of $370,166.71 for the 2016 Loan, and $320,017.26

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19-cv-390-GPC-AHG

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for the 2017 Loan.” Id. at 6. In support of the Ex Parte Motion, Plaintiff argued that

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Ninth Circuit law, including Semar v. Platte Valley Fed. Sav. & Loan Ass’n, 791 F.2d

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699 (9th Cir. 1986), prohibits the defendants’ presentation of affirmative defenses. Ex

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Parte Mot. 4, ECF No. 230.

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On December 17, 2020, the Court held its pretrial conference. Min. Entry, ECF

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No. 234. At the pretrial conference, the Court set a trial date and hearing date for the

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motions in limine. See Tr. of Final Pretrial Conference 4–5, ECF No. 242. Further, the

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Court noted that the proposed pretrial order sought a ruling on “whether the lender

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defendants would be allowed to make arguments resoundingly rejected by the Ninth

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Circuit and Semar.” Id. at 5. The Court declined to issue a ruling because the matter was

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scheduled as a pretrial conference hearing, not a hearing to consider substantive issues.

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Id. Instead, the parties were directed to file a motion in limine to exclude issues or

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defenses. Id. at 5–6.

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The Investor Defendants’ initial proposal was to bifurcate the trial. The first phase

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would address statutory damages on jury trial, and the second phase would address the

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Investor Defendants’ affirmative defenses on bench trial. Plaintiff took the position that

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“it all should go to a jury.” Id. at 6–7. When the Court then directed the parties to brief

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on whether the second phase should be done by bench trial versus jury trial and provided

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briefing schedules (with the Investor Defendants first submitting their opening papers),

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Counsel for the Investor Defendants later stipulated that the whole case can proceed via

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jury trial. Id. at 7–9.

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Correspondingly, the following exchanges occurred at the pretrial conference:

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THE COURT:

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. . . And with respect to this proposed bifurcation, I will be
prepared to have a jury trial on the affirmative defenses
only if the law requires it. If the law permits the Court to
entertain those issues at a bench trial, I plan to do that in
order to conserve judicial resources, in order to conserve
juries’ time in performing jury service.
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So, to the extent that at this point the defense is backing off
of that earlier proposal, I will have my chambers look at
the question without briefing unless, Mr. Sundby, you
would like to submit a brief on it, and then we would have
basically the reverse scheduling that I just announced, as
far as January 22, February 12, and February 19. Instead
of the defendant investors filing their papers on January
22, I would have you submit your papers.

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How would you like to proceed, Mr. Sundby?

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MR. SUNDBY: No, I am fine with what you just said. If the Court is going to
make that determination, then that’s fine.

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THE COURT:

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So, then, we will do that -- if not in house, we will do it in
chambers, and then I will advise the parties at the appropriate
time.

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Id. at 13–14.

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After the December 17 pretrial conference, the Court entered a Minute Entry which

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incorrectly reports: “Chambers will decide issue of Lender Defendants[’] right to present

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‘affirmative defense’ offered by defendant investors.” ECF No. 234. The Minute Entry

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is incorrect because the transcript of the hearing clearly reveals that the Court stated it

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would decide in chambers without further briefing the question regarding the right to a

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jury trial on the affirmative defenses, and not the question whether Semar prohibits the

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defendants’ presentation of an affirmative defense. This latter issue will be decided at or

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following the motion in limine hearing which is scheduled on January 28, 2022.

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///

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CONCLUSION

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Therefore, the Court OVERRULES Plaintiff’s Objection. The parties will be

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permitted to address the question regarding equitable defenses in their motions in limine

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and will be addressed by the Court at the scheduled in limine hearing.

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IT IS SO ORDERED.

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Dated: January 7, 2021

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