Orlowski et al v. Bates et al

Filing 508

ORDER denying 506 Motion to Stay; denying 506 Motion to Appoint Counsel; Continuing the Trial Date. Signed by Judge Jon Phipps McCalla on 10/26/2015. (McCalla, Jon)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
WESTERN DIVISION

DAMIAN ORLOWSKI, et al.,

)
)
Plaintiffs, on behalf of )
themselves and all others)
similarly situated,
)
)
v.
)
)
LARRY C. BATES, et al.,
)
)
Defendants.
)

No. 2:11-cv-01396-JPM-cgc

ORDER DENYING DEFENDANTS CHARLES BATES’ AND ROBERT BATES’ MOTION
TO STAY PROCEEDINGS AND FOR APPOINTMENT OF COUNSEL; CONTINUING
THE TRIAL DATE

On December 28, 2011, Plaintiffs filed a Complaint alleging
various causes of action, including fraud and statutory
racketeering violations, stemming from the failure of First
American Monetary Consultants, Inc. (“FAMC”) to deliver on
orders of precious metals. (See ECF No. 1.)

Plaintiffs filed a

Third Amended Complaint on October 20, 2014. (ECF No. 375.) On
October 20, 2015, Defendants Charles Bates and Robert Bates
filed this Motion to Stay Proceedings and for Appointment of
Counsel.

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(ECF No. 506.) 1

Defendants Charles Bates and Robert Bates are currently represented by Mr.
T. Tarry Beasley, II. In the instant Motion, Mr. Beasley states:

Defendants Charles Bates and Robert Bates have requested
that the Court stay proceedings until the resolution of the
pending criminal matter, release current counsel from
representation of these Defendants, and appoint new counsel in
this matter. (ECF No. 506.)
“A stay of a civil case is an extraordinary remedy that
should be granted only when justice so requires.”

Chao v.

Fleming, 498 F. Supp. 2d 1034, 1037 (W.D. Mich. 2007).

“The

Constitution . . . does not ordinarily require a stay of civil
proceedings pending the outcome of criminal proceedings.”
S.E.C. v. Dresser Indus., Inc., 628 F.2d 1368, 1375 (D.C. Cir.
1980) (citing Baxter v. Palmigiano, 425 U.S. 308 (1976)).

One

of the strongest cases “for deferring civil proceedings until
after completion of criminal proceedings is where a party under
indictment for a serious offense is required to defend a civil
or administrative action involving the same matter.”
1375-76.

Id. at

In these circumstances “[t]he noncriminal proceeding,

if not deferred, might undermine the party’s Fifth Amendment

Current counsel for these Defendants has heretofore directly
requested of this Court permission to be released from
representation of these parties due to the parties’ inability to
cover the expenses as a result of the Court’s Order freezing all
of these Defendants’ assets. Further, the separate criminal
matter pending against these Defendants further impairs the
Defendants and their counsel to defend against this matter.
(Mot. to Stay Proceedings and Appointment of Counsel ¶ 6, ECF No. 506.) To
the extent that Mr. Beasley wishes to withdraw his representation, he should
file a formal motion to withdraw, giving his clients notice and citing the
applicable rule(s). See LR 83.5 and Tenn. R. Prof’l Conduct 1.16.
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privilege against self-incrimination, expand rights of criminal
discovery beyond the limits of Federal Rule of Criminal
Procedure 16(b), expose the basis of the defense to the
prosecution in advance of criminal trial, or otherwise prejudice
the case.”

Id. at 1376.

“The decision to stay a case requires an examination of the
specific circumstances, taking into account the competing
interests involved.”

Chao, 498 F. Supp. 2d at 1037 (citing

Sterling Nat’l Bank v. A-1 Hotels Int’l, Inc., 175 F. Supp. 2d
573, 576 (S.D.N.Y. 2001)).

In determining whether a stay is

warranted, a court should several factors, including:
1) the extent to which the issues in the criminal case
overlap with those presented in the civil case; 2) the
status of the case, including whether the defendants
have been indicted; 3) the private interests of the
plaintiffs in proceeding expeditiously weighed against
the prejudice to plaintiffs caused by the delay; 4)
the private interests of and burden on the defendants;
5) the interests of the courts; and 6) the public
interest.
Trs. of Plumbers and Pipefitters Nat’l Pension Fund v.
Transworld Mech., Inc., 886 F. Supp. 1134, 1139 (S.D.N.Y. 1995).
Balancing these factors, the Court concludes that
continuing the trial is appropriate in this case as to Charles
Bates, Robert Bates, and Larry Bates so as to not interfere with
their Fifth Amendment rights.

To avoid duplication of trial

preparation, the trial in this case will also be continued as to
the other defendants.
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The Court declines, however, to stay all proceedings in
this case.
judgment.

There are currently two pending motions for summary
These motions were filed before Defendants Charles

Bates, Robert Bates, and Larry Bates were indicted on August 4,
2015.

Resolution of these motions does not implicate the same

Fifth Amendment concerns as does a trial in this case.
parties completed discovery in June 2015.
424.)

The

(See ECF Nos. 400,

Thus, any evidence that Defendants wished to submit in

response to Plaintiffs’ Motion for Summary Judgment was produced
before the August 6, 2015, indictment.

Plaintiffs filed their

initial Complaint in this matter on December 28, 2011.
1.)

(ECF No.

According to the Complaint, First American Monetary

Consultants, Inc. (“FAMC”) was established in 1984.
Third Am. Compl. ¶ 21, ECF No. 375.)

(Id. ¶ 13;

The Complaint alleges

injuries incurred by Plaintiffs who placed yet unfulfilled
orders with FAMC as early as 2006.

(See Third Am. Compl.

¶ 149(u).)
As is evident in the instant case, there is a need to
resolve expeditiously the issues in this matter that can be
addressed without compromising the Fifth Amendment rights of the
indicted Defendants.

Accordingly, the Court DENIES Defendants

Charles Bates’ and Robert Bates’ Motion to stay proceedings, but
CONTINUES the trial date in this matter until the associated
criminal matter is resolved.
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Pursuant to 28 U.S.C. § 1915(e)(1), “[t]he court may
request an attorney to represent any person unable to afford
counsel.”

In a civil proceeding, however, “[t]he appointment

of counsel . . . is not a constitutional right.” Lanier v.
Bryant, 332 F.3d 999, 1006 (6th Cir. 2003); see also Shepherd v.
Wellman, 313 F.3d 963, 970 (6th Cir. 2002) (“[T]he plaintiffs
were not entitled to have counsel appointed because this is a
civil lawsuit.”); Lavado v. Keohane, 992 F.2d 601, 605-06 (6th
Cir. 1993) (no constitutional right to counsel in a civil case);
Farmer v. Haas, 990 F.2d 319, 323 (7th Cir. 1993) (“There is no
constitutional or . . . statutory right to counsel in federal
civil cases . . . .”).
Appointment of counsel is “a privilege that is justified
only by exceptional circumstances.” Lavado, 992 F.2d at 606
(internal quotation marks omitted).
In determining whether “exceptional circumstances”
exist, courts have examined “the type of case and the
abilities of the [litigant] to represent himself.”
Archie v. Christian, 812 F.2d 250, 253 (5th Cir.
1987); see also Poindexter v. FBI, 737 F.2d 1173,
1185 (D.C. Cir. 1984). This generally involves a
determination of the “complexity of the factual and
legal issues involved.” Cookish v. Cunningham, 787
F.2d 1, 3 (1st Cir. 1986).
Id. at 606. “Appointment of counsel . . . is not appropriate
when a pro se litigant’s claims are frivolous or when the
chances of success are extremely slim.” Id. (citation omitted)
(quoting Mars v. Hanberry, 752 F.2d 254, 256 (6th Cir. 1985));
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see also Cleary v. Mukasey, 307 F. App’x 963, 965 (6th Cir.
2009) (same).

Moreover, “[c]ourts do not perform a useful

service if they appoint a volunteer lawyer to a case which a
private lawyer would not take if it were brought to his or her
attention.”

Johnson v. Memphis City Schools, No. 09-2049-STA-

tmp, 2009 WL 6057287, at *1 n.2 (W.D. Tenn. June 4, 2009)
(quoting Cooper v. A. Sargenti Co., 877 F.2d 170, 174 (2d Cir.
1989)).
Defendants Charles Bates and Robert Bates have not
satisfied their burden of demonstrating that appointment of
counsel would be appropriate in this case.

Additionally, it

would be unhelpful for the Court to appoint a volunteer lawyer
“to a case which a private lawyer would not take.”
2009 WL 6057287, at *2.

See Johnson,

Based on the record developed thus far,

success appears improbable for Defendants Charles Bates and
Robert Bates.

It would, therefore, be inappropriate to appoint

private counsel for these defendants.

See Gregg v.

SBC/Ameritech, 321 F. App’x 442, 448 (6th Cir. 2009) (affirming
district court’s denial of motion for appointment of counsel
because “[a]s clearly noted in the district court’s decisions in
the substantive aspects of this litigation, Gregg’s prospects
for success . . . were not good”); Brown v. Kordis, 46 F. App’x
315, 317 (6th Cir. 2002) (holding that the district court did

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not abuse its discretion in denying request for counsel where
the plaintiff’s claims had “only a slim chance of success”).
The Court further notes that Defendants have failed to file
materials to support the proposition that they are unable to
afford counsel. 2

See Sutton v. U.S. Small Bus. Admin., 92 F.

App’x 112, 116-17 (6th Cir. 2003) (holding that the district
court did not abuse its discretion in denying the plaintiff’s
motion for appointment of counsel where the plaintiff failed “to
demonstrate his indigence”); Hauck v. State of Tenn., 872 F.2d
1025, 1089 WL 40261, at *1-2 (6th Cir. 1989) (upholding the
district court’s denial of the prisoner’s motion to proceed in
forma pauperis because his attached affidavit did not establish
his indigence).

Additionally, Defendants Charles Bates and

Robert Bates are educated individuals with sophisticated
backgrounds.

(See Charles Bates Dep. 10:21-11:25, ECF No. 323;

Robert Bates Dep. 24:17-27:24, ECF No. 89-1.)

Both also have

detailed knowledge and experience gained in the precious metals
and information systems fields.

See Sutton, 92 F. App’x at 117

(noting that, in denying the plaintiff’s motion for appointment
of counsel, “the district court considered the court’s
familiarity with the implicated issues and principles, the
case’s advanced procedural posture, and plaintiff’s ‘well-

2

Orders attaching the assets of both Charles Bates and Robert Bates have been
entered. (ECF Nos. 440, 443, 488, 493, 503.) These orders do not resolve
the issue of the unaccounted-for assets.
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drafted’ response to SBA’s dispositive motion”).

Accordingly,

the Court DENIES Defendants Charles Bates’ and Robert Bates’
Motion for appointment of counsel.
For these reasons, Defendants Charles Bates’ and Robert
Bates’ Motion to Stay Proceedings and for Appointment of Counsel
is DENIED. The Court hereby CONTINUES the trial date in this
matter pending resolution of the indicted Defendants’ associated
criminal matter.
The Pretrial Conference scheduled for 9:00 a.m. on Tuesday,
October 27, 2015, is converted to a Status Conference.

IT IS SO ORDERED, this 26th day of October, 2015.

/s/ Jon P. McCalla
JON P. McCALLA
UNITED STATES DISTRICT JUDGE

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