Title: NuVeda, LLC v. Eighth Judicial District Court

State: nevada

Issuer: Nevada Supreme Court

Document:

008 Oe

137 Nev, Advance Opinion 54
IN THE SUPREME COURT OF THE STATE OF NEVADA

NUVEDA, LLC, No. 82649
Petitioner,
‘THE EIGHTH JUDICIAL DISTRICT
COURT OF THE STATE OF NEVADA, FILED
IN AND FOR THE COUNTY OF
CLARK; AND THE HONORABLE SEP 23 2021
ELIZABETH GONZALEZ, DISTRICT Sait
JUDGE, ails
Respondents, “afer

and

SHANE TERRY; PHIL IVEY; AND
DOTAN Y. MELECH, RECEIVER FOR
(CWNEVADA, LLC, A NEVADA
LIMITED LIABILITY COMPANY,

Real Parties in Interest.

 

Original petition for a writ of prohibition or, in the alternative,

mandamus challenging a district court order denying a motion to transfer

indirect contempt proceedings to another judge under NRS 22.030(3).
Petition denied.

Law Office of Mitchell Stipp and Mitchell
for Petitioner.

 

, Las Vegas,

Mushkin & Coppedge and Michael R. Mushkin and L. Joe Coppedge, Las
Vegas,
for Real Parties in Interest.

BEFORE THE SUPREME COURT, PARRAGUIRRE, STIGLICH, and
SILVER, JJ.

u-ugay

 

 
ne oe

OPINION
By the Court, STIGLICH, J.:

NRS 22.030(3) provides that in cases of indirect contempt, “the
Judge of the court in whose contempt the person is alleged to be shall not

preside at the trial of the contempt over the objection of the person.”

 

statute gives accused contemnors a peremptory challenge, which must be
granted if the objection is timely and properly made. Here, petitioner
NuVeda, LLC, moved for a change of judge under NRS 22.020(3) 37 days
after the court set a date for the contempt trial. The district court denied
this motion as untimely, and NuVeda petitioned this court for extraordinary
writ relief, We hold that motions for a change of judge under NRS 22.0303)
‘must be made with reasonable promptness under the circumstances, and
here, the district court did not err by determining the motion was untimely.
Accordingly, we deny the petition.
FACTS AND PROCEDURAL HISTORY

This contempt case arises out of a relatively complex business
dispute. Petitioner NuVeda, in conjunction with CWNevada, LLC, formed
CWNV as a joint venture in 2017 for the purpose of building and operating
cannabis establi

 

ments. CWNevada was later placed under receivership.
NuVeda and its managing member, Dr. Pejman Bady, allegedly dissolved
CWNV and later created a new entity with the same name. This act not
only created difficulties for the receiver, but it also is alleged to violate a
court order, constituting contempt. NuVeda denies that it committed
contempt, and many of the facts remain disputed. Most of the details of the
supposed contempt and the situation underlying it are immaterial to this
writ petition.

 

 
For our purposes, the critical facts are these. On February 1,
2021, during a hearing on a motion for an order to show cause concerning
the alleged contempt, the district court (Judge Elizabeth Gonzalez) found
that a show cause order was warranted and scheduled a contempt hearing
for March 1. But Dr. Bady had a previously scheduled medical appointment
‘and could not attend on that date. On or around February 22, the district
court rescheduled the hearing to April 5. On March 10, NuVeda for the first
time invoked NRS 22.0303) and objected to Judge Gonzalez presiding over
the contempt hearing. At a hearing on March 17, the district court stated
that while it might have granted the request for a new judge if NuVeda had
made such a request sooner, NuVeda had waived any objection when it
failed to include one in its prior motion for a continuance. NuVeda denied
that it had ever moved for a continuance, pointing out that it had previously
stated it was willing to go forward without Dr. Bady. NuVeda renewed its
objection under NRS 22.0303), but the
objection.

 

strict court overruled the

NuVeda now petitions this court for a writ of prohibition and/or
mandamus. It asks us to disqualify Judge Gonzalez from presiding over the
contempt hearing and to order the Chief Judge of the Eighth Judicial
District Court to randomly reassign that hearing to another judge. We
stayed the contempt hearing pending resolution of this writ petition.

DISCUSSION
We will entertain this writ petition

“Because both writs of prohibition and writs of mandamus are
extraordinary remedies, we have complete discretion to determine whether
toconsider them.” Cote H. v. Eighth Judicial Dist. Court, 124 Nev. 36, 39,
175 P.3d 906, 908 (2008); see Smith v. Eighth Judicial Dist. Court, 107 Nev.
674, 677, 818 P.2d 849, 851 (1991). This court may exercise its diseretion

 

 
to entertain a petition for extraordinary writ relief when “an important
issue of law needs clarification and considerations of sound judicial economy
and administration militate in favor of [considering] the petition.” Archon
Corp. v. Eighth Judicial Dist. Court, 133 Nev. 816, 820, 407 P.3d 702, 706
(2017) (quoting Int Game Tech., Inc. v. Second Judicial Dist. Court, 124
Nev. 193, 197-98, 179 P.3d 656, 559 (2008)). We conclude that our
consideration of this writ petition is warranted. NRS 22.030(3) is a
procedural rule that is potentially implicated in every indirect contempt
hearing, no matter the underlying substantive issues. Just this year, we
addressed the timeliness of a motion under NRS 22.030(3), yet that case left
open the precise issue presented by this case. See Detwiler v. Eighth
Judicial Dist. Court, 137 Nev., Adv. Op. 18, 486 P.3d 710, 717 & n.4 (2021).
“Blecause this petition involves a question of first impression that arises
with some frequency, the interests of sound judicial economy and
administration favor consideration of the petition.” See Cote H., 124 Nev.
at 39-40, 175 P.3d at 908.
Standard of review

Here, NuVeda seeks both mandamus and prohibition. It seeks
mandamus to the extent it asks us to direct the district court to grant its
motion to transfer the contempt proceedings to a new judge, and it seeks
prohibition to the extent it asks us to direct Judge Gonzalez not to preside
at the contempt hearing. NuVeda appears to argue that Judge Gonzalez
was automatically recused, by operation of law, when it filed its objection
and therefore she would exceed her legal authority if she were to preside
over the hearing.

“A writ of mandamus is available to compel the performance of
an act that the law requires as a duty resulting from an office, trust, or

station, or to control a manifest abuse of discretion.” Agwara v. State Bar

4

 

 
of Nev., 133 Nev. 783, 785, 406 P.3d 488, 491 (2017) (internal quotation
marks omitted). “A writ of prohibition is the counterpart to a writ of
mandamus and may be issued to compel a person or body exercising judicial
functions to cease performing beyond its legal authority.” Id. (internal
quotation marks omitted). Specifically, “[wJhen the district court acts

 

out or in excess of its jurisdiction, a writ of prohibition may issue to
curb the extrajurisdictional act.” Canarelli v. Eighth Judicial Dist. Court,
136 Nev. 247, 250, 464 P.3d 114, 119 (2020) (internal quotation marks
omitted),

“When considering a writ of mandamus, we generally apply a
manifest abuse of discretion standard . . ..” Stephens Media, LLC v. Eighth
Judicial Dist. Court, 125 Nev. 849, 860, 221 P.3d 1240, 1248 (2009). In

 

contrast, where a party contends in a petition for a writ of prohibition that
the district court has exceeded or is about to exceed its jurisdiction, we
review that issue de novo. See Fulbright & Jaworski LLP v. ighth Judicial
Dist. Court, 131 Nev. 30, 35, 342 P.3d 997, 1001 (2015). Because NuVeda
seeks both types of relief arising out of the same alleged procedural error,
we will review the jurisdictional facts de novo, making separate review for
manifest abuse of discretion unnecessary. Still, even when challenging the
district court's jurisdiction, “[pletitioners bear the burden of showing that
this court's extraordinary intervention is warranted.” Nev. State Bd. of
Architecture, Interior Design & Residential Design v. Eighth Judicial Dist.
Court, 135 Nev. 375, 377, 449 P.3d 1262, 1264 (2019).

A motion for a new judge under NRS 22.030(3) must be made reasonably
promptly

NuVeda argues that the district court was required to grant its
request for a new judge because—in its view—a party can object under NRS

22.030(3) at any time before commencement of the trial on contempt.

 

 
NuVeda contends that disqualification is automatic upon lodging the
objection and that objections cannot be waived. Reviewing this matter of
statutory interpretation de novo, see Fulbright, 131 Nev. at 35, 342 P.3d at
1001, we hold that objections can be waived if not asserted reasonably
promptly.

RS 22.030(3) provides accused contemnors with a peremptory
challenge that serves to “eliminate the possibility of a reasonable
apprehension that a judge might not be entirely free from bias in enforcing
the orders and decrees of the court of which [she is the judge.” McCormick
v. Sixth Judicial Dist. Court, 67 Nev. 318, 331-32, 218 P.2d 939, 945 (1950).
We have described NRS 22.0303) as “an automatic recusal.” Awad v.
Wright, 106 Nev. 407, 411, 794 P.2d 713, 715 (1990), abrogated on other
grounds by Pengilly v. Rancho Santa Fe Homeowners Ass'n, 116 Nev. 646,
649, 5 P.3d 569, 571 (2000). At the same time, we emphasized that the
objection in that case was “timely and properly made.” Id. at 410, 794 P.2d
at 715. ‘Thus, recusal is not truly “automatic.” Rather, the accused
contemnor must request recusal, and must do so in a timely fashion."

We have recently reaffirmed in Detwiler v. Eighth Judicial
District Court that “timeliness is essential, as ‘[glrounds for disqualifying a
judge can be waived by failure to timely assert such grounds.” 137 Nev.,
Adv. Op. 18, 486 P.3d at 717 (alteration in original) (quoting City of Las
Vegas Downtown Redev. Agency v. Hecht, 113 Nev. 644, 651, 940 P.2d 134,
139 (1997)). The petitioner in Detwiler did not invoke his rights under NRS

 

MIn many cases, the accused contemnor might prefer not to change
judges. Especially in a complex case with disputed facts, a party may well
prefer to explain itself to the judge who is most familiar with the factual
background and with the context of the order allegedly violated.

 

 
ne

   

22.080(3) until after the hearing had already taken place, which we
explained was “untimely under any possible standard.” Id, at 717 n4.
Accordingly, we had no reason to consider in detail what would make a
motion for a change of judge “timely.” We simply held that such a motion
made after the contempt trial is untimely. Nevertheless, we “encourage(d]
litigants to act without undue delay in exercising peremptory challenges to
judges.” Id. at 713.

We must now reach the issue we left open in Detwiler: Can a
court deny a motion for a new judge under NRS 22.030(3) as untimely if the
motion is made before the contempt trial, but nevertheless after a
significant delay? We conclude the answer is yes. Although “NRS 22.0303)
contains no express deadline,” Detwiter, 137 Nev., Adv. Op. 18, 486 P.3d at

 

717, that fact does not provide license for undue delay. Courts routinely
imply timely filing requirements for recusal motions “despite the text's
silence.” See Kolon Indus. Inc. v. F.1. DuPont de Nemours & Co., 748 F.3d
160, 168-69 (4th Cir. 2014), “While there is no per se rule that recusal
motions must be made at a fixed point in order to be timely, such motions
should be filed with reasonable promptness after the ground for such a
motion is ascertained.” United States v. Mikhel, 89 F.3d 1003, 1026 (9th
Cir. 2018) (quoting E. & J. Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280,
1295 (9th Cir. 1992)). For example, when a party discovers new grounds for
disqualifying a judge under Nevada Code of Judicial Conduct Canon 3E, the
party must move for disqualification “as soon as possible after becoming
aware of the new information.” Towbin Dodge, LLC v. Highth Judicial Dist.
Court, 121 Nev. 251, 260, 112 P.3d 1063, 1069 (2005). We hold that
disqualifications under NRS 22.030(3) are no different, and a party must
move for such disqualification with reasonable promptness.

 

 
NuVeda’s proposal that such objections may be made at any
time before the commencement of the hearing, simply because the statute
provides no express deadline, is both an incorrect and an unrealistic
standard. Not requiring some reasonable measure of promptness “would
result in increased instances of wasted judicial time and resources and a
heightened risk that litigants would use recusal motions for strategic
purposes.” Preston v. United States, 923 F.2d 731, 733 (9th Cir. 1991)
(internal citations omitted). To be sure, if a party learns of new grounds for
disqualification, those grounds may be raised reasonably promptly after
learning the new information. Towbin Dodge, 121 Nev. at 260, 112 P.3d at,
1069; see Preston, 923 F.2d at 733 (finding motion to disqualify judge was
timely when filed 18 months after case was transferred, but 10 days after
learning of grounds for disqualification). But as this court has noted, a
party accused of contempt should be aware that a peremptory challenge i
available under NRS 22.030(3) “as soon as he or she receives the order to
show cause.” Detwiler, 137 Nev., Adv. Op. 18, 486 P.3d at 717. When the
party raises a peremptory challenge after substantial delay, that is evidence

 

of inattention at best and of intent to delay the proceedings at worst. See
Mikhel, 889 F.3d at 1026 (noting that “unexplained delay in filing a recusal
motion suggests that the recusal statute is being misused” (internal
quotation marks omitted))..

Accordingly, we hold that litigants are not only
“encourageld] ... to act without undue delay in exercising peremptory
challenges to judges,” see Detwiler, 137 Nev., Adv. Op. 18, 486 P.3d at 713,
but are in fact required to do so. A motion under NRS 22.030(3) must be
made with “reasonable promptness after the ground for [the] motion is
ascertained,” see Mikhel, 889 F.3d at 1026, and these grounds are typically

 

 
ascertained when the party receives notice that it is facing a contempt
hearing, Detwiler, 137 Nev., Adv. Op. 18, 486 P.3d at 717. Undue delay may
result in the motion being denied.
The district court did not err by finding this motion was untimely

Having rejected NuVeda’s argument that a motion for recusal
is necessarily timely at any time before the hearing, we must decide
whether the district court erred by concluding this motion was untimely.
NuVeda argues that the district court found NuVeda waived its rights
under NRS 22.030(3) solely because it moved for a continuance on
February 22 and that this was error because NuVeda did not in fact move
for a continuance, NuVeda reads the district court's reasoning too narrowly.
‘The district court properly found that NuVeda’s motion was untimely when
it was filed on March 10—37 days after NuVeda was notified of the
contempt hearing on February 1—whether or not NuVeda moved for a
continuance on February 22.

It is true that a party does not necessarily waive its right to
request a new judge simply because it moves for a continuance first.
Certai

 

objections, like objections to personal jurisdiction or service of
process, “must be raised at the first available opportunity” or be waived.
See Am. Ass'n of Naturopathic Physicians v. Hayhurst, 227 F.3d 1104, 1106
(9th Cir, 2000); see also NRCP 12(g\2), (hX(1). Nothing indicates that
objections under NRS 22.030(3) are of this type. A court determining
whether an NRS 22,030(3) motion is timely should not look mechanically at
whether the objection was raised at the first opportunity; rather, it should
consider whether the party objected reasonably promptly under the
circumstances.

But our agreement with NuVeda ends there. While the record

is unfortunately unclear as to whether NuVeda in fact moved for a

9

 

 
4

continuance on February 22, the record does show that NuVeda had ample
opportunity after February 1 to move for a change of judge, yet did not do
so for 37 days. When the district court asked NuVeda’s counsel why he did
not invoke the statute before February 22—the date the court first
continued the hearing—counsel replied only that it was not clear to him
whether he could make the objection at that time. Of course, that is not,
ordinarily good cause for a delay. Although the district court did refer to
NuVeda’s purported motion for a continuance, it is ultimately immaterial
whether NuVeda in fact moved for a continuance or whether the district
court continued the hearing sua sponte. Had the district court simply asked
why NuVeda did not move for a new judge within three weeks after the
hearing date was originally set, the result would have been the same.
Although we do not defer to the district court's reasonableness
determinations when jurisdiction is at stake, see Fulbright & Jaworski, 131
Nev. at 35, 342 P.3d at 1001, petitioners must show why this court's
extraordinary intervention is warranted, Nev. State Bd. of Architecture, 135
Nev. at 377, 449 P.3d at 1264. We conclude that the district court did not
err, and thus NuVeda has failed to carry its burden. This court has held
that an objection under NRS 22.030(3) was timely when it was made nine
days after the party received an order to show cause. See Awad, 106 Nev.
at 408, 410, 794 P.2d at 714, 715. NuVeda's 37-day delay was far longer,
and NuVeda has offered no justification for that delay. Under these
circumstances, we are concerned that the lateness of NuVeda’s motion
might have indicated a “misuse[]” of the recusal statute, see Mikhel, 889
F.3d at 1026, or would ‘waste[] judicial time and resources” by
necessitating a second continuance, see Preston, 923 F.2d at 733. In the
absence of any reasonable justification for the delay, we hold that 37 days

10

 

 
 

is too long. ‘The district court properly found that NuVeda’s delay was
unreasonable and properly denied the motion to change judges.
CONCLUSION
While a district court has no discretion to deny a timely and
proper motion for a new judge under NRS 22.030(3), a party may waive its
right to request a new judge by failing to make that request in a reasonably
prompt manner. Because NRS 22.030(3) provides a peremptory challenge
that does not depend on the facts of a particular case, a party that wishes
to exercise its rights under that statute has the ability to do so promptly.
Hero, the district court properly found NuVeda's request was not made
reasonably promptly when that request was made 37 days after the district
court set the hearing date. Accordingly, we deny NuVeda's petition for writ
relief, The stay this court granted on April 2, 2021, is lifted, and the district
court may proceed with the contempt hearing,

4
Stiglich
We concur:
4
Tarraguirre
AD Tee» 4
Silver

u