Broyles v. Cantor Fitzgerald & Co. et al
Filing
349
RULING: Finding that it is premature at this early stage in discovery to order severance, this Court DENIES the #338 Motion to Sever and Proceed Separately. If managing discovery with a large number of parties remains a concern, this Court would suggest that the parties consider the services of a Special Master for purposes of discovery. Signed by Judge James J. Brady on 06/25/2015. (BCL)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA
JOSEPH N. BROYLES, ET AL.
CIVIL ACTION
VERSUS
NO. 10-854-JJB-SCR
CANTOR FITZGERALD & CO., ET AL.
RULING ON MOTION TO SEVER
Before this Court is the Motion to Sever and Proceed Separately (doc. 338), as filed by
the S&Y Parties.1 At the time it filed the motion at issue, S&Y Parties received consent from
Plaintiff-CA Funds and “all other parties to this Action except Defendants Kevin Miller, Walter
Morales, and Commonwealth and the Plaintiff-Investors” (doc. 338, at 1). Subsequently, an
opposition was filed by two of the Commonwealth-Defendants (doc. 342).2 The motion and all
responsive briefs have been considered by the Court.
S&Y Parties’ motion asks this Court to sever the two consolidated matters and order that
they proceed separately so that they can be handled more efficiently and economically. S&Y
Parties are of the belief that the cases will be handled more efficiently and economically when
separate provided that a series of suggested accommodations are followed. These proposed
accommodations all involve the parties in both cases agreeing to work together for purposes of
discovery.
Commonwealth-Defendants oppose the motion to sever and point this Court’s attention
to the five-factor standard this Court has previously adopted from the Eastern District of
Louisiana in determining whether a claim or claims should be severed:
(1) whether the claim arose out of the same transaction or occurrence; (2) whether
the claims present common questions of law or fact; (3) whether settlement or
judicial economy would be promoted; (4) whether prejudice would be averted by
severance; and, (5) whether different witnesses and documentary proof are
required for separate claims.
Melancon v. Town of Sorrento, No. Civ.A. 12-746-JWD, 2015 WL 410866, at *5 (M.D. La. Jan
29, 2015). It is the argument of Commonwealth-Defendants that all five factors weight against
1
“S&Y Parties” herein refers to Stone & Youngberg, LLC, Stifel Financial Corp., Stifel Nicolaus & Company, Inc.,
and Anthony Guaimano.
2
“Commonwealth-Defendants” herein refers to Walter Morales and Commonwealth.
1
severance of the two consolidated matters. Most convincing is Commonwealth-Defendants
arguments as to the fifth factor. Commonwealth-Defendants urge that if the matter is severed,
many of the witnesses will be deposed twice in separate proceedings, in addition to many already
having been deposed by the SEC (doc. 342-1, at 2). As Commonwealth-Defendants
acknowledge, the S&Y Parties are seeking severance at an early stage since discovery is set to
continue for only slightly less than another year.3
The Court recognizes that its ruling in December 2014 dismissed certain claims against
S&Y Parties. S&Y Parties express a concern that continued consolidation will subject them to
discovery on claims that have already been dismissed (doc. 345, at 5). While recognizing S&Y
Parties’ concern, the Court must reiterate the point made by S&Y Parties themselves, which is
that this Court has already ruled to dismiss certain claims and that should be considered as
discovery proceeds. A district court has broad discretion over whether to sever issues and claims.
Brunet v. United Gas Pipeline Co., 15 F.3d 500, 505 (5th Cir. 1994). Finding that it is premature
at this early stage in discovery to order severance, this Court DENIES the Motion to Sever and
Proceed Separately (doc. 338). If managing discovery with a large number of parties remains a
concern, this Court would suggest that the parties consider the services of a Special Master for
purposes of discovery.
Signed in Baton Rouge, Louisiana, on June 25, 2015.
JUDGE JAMES J. BRADY
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA
3
S&Y Parties own brief on a separate issue acknowledges that discovery is scheduled to last until April of 2016
(doc. 331-1, at 5).
2
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