Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_09-cv-08162/USCOURTS-azd-3_09-cv-08162-5/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:78m(a) Securities Exchange Act

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UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

ALLSTATE LIFE INSURANCE

COMPANY, an Illinois Life Insurance

Company,

Plaintiff,

vs.

ROBERT W. BAIRD & CO., INC., a

Wisconsin corporation, et al.,

Defendants.

No. CV-09-8162-PHX-GMS

No. CV-09-8174-PHX-GMS

(Consolidated)

ORDER

RONALD COVIN, BARNARD

PATTERSON, ALLEN PATZKE and

WALTER KRAUSE individually, on

behalf of themselves and all others

similarly situated,

Plaintiffs,

vs.

ROBERT W. BAIRD & CO., Inc., a

Wisconsin corporation, et al.,

Defendants.

Case 3:09-cv-08162-GMS Document 419 Filed 07/26/11 Page 1 of 3
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Pending before this Court is Prescott Valley’s Motion For Order Implementing the

PSLRA’s Stay Provisions While The Town’s Motion To Dismiss Is Pending (Doc. 354). For

the reasons stated below the motion is granted. 

On May 25, 2011, Prescott Valley filed its second motion to dismiss (Doc. 350), in this

matter. The PSLRA specifies that:

In any private action arising under [the relevant provision of the PSLRA] all

discovery and other proceedings shall be stayed during the pendency of any

motion to dismiss, unless the court finds upon the motion of any party that

particularized discovery is necessary to preserve evidence or the prevent undue

prejudice to that party.

15 U.S.C. § 78u-4(b)(3)(B) (2009). The language of the statute seems to give the Court little

discretion, “all discovery . . . shall be stayed during the pendency of any motion to dismiss.”

See also, SG Cowen Sec. Corp. v. U.S. Dist. Court, 189 F.3d 909, 911 (9th Cir. 1999). The two

exceptions provided by the statute are if “particularized discovery is necessary to preserve

evidence,” or “to prevent undue prejudice to” a moving party. 

Although Plaintiffs did file a tardy response to Defendant’s motion (Doc. 380), the

response did not request “particularized discovery to preserve evidence,” nor did it set forth with

any great particularity any undue prejudice that it would suffer in light of such a stay. It did

suggest some collateral authority reasonably suggesting that the “abusive invocation of the

PSLRA’s stay provision through serial motions to dismiss” might result in undue prejudice to

the parties where the motion is frivolous and advanced solely to delay the proceedings. See,

e.g, In re Salomon Analyst Litig., 373 F. Supp. 2d 252, 254-55 (S.D.N.Y. 2005). 

Plaintiffs correctly point out that an initial and lengthy stay pursuant to Defendant’s

initial motion to dismiss has already occurred in this action. Nevertheless, without more

thoroughly reviewing Defendant’s motion, this Court cannot determine that it is frivolous or that

it is “advanced solely to delay the proceedings,” nor does Plaintiffs’ response establish as much

to the satisfaction of the Court. Defendant has set forth a sufficient basis on which the Court

might conclude that Defendant could not have brought this motion absent some initial

discovery. Therefore, because it cannot conclude at this juncture that the motion is frivolous,

the Court will stay all further discovery and other proceedings in this matter, until the Court

rules on Prescott Valley’s second Motion to Dismiss (Doc. 350). 

Case 3:09-cv-08162-GMS Document 419 Filed 07/26/11 Page 2 of 3
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The parties are further advised that to the extent the deadlines set forth in the Case

Management Order (Doc. 257), have already passed, e.g. Deadline for Joining Parties,

Amending Pleadings and Filing Supplemental Pleadings, Deadline to file Class Certification

Motions, and Deadline for Non-Party at Fault designations, the Court intends to apply and

enforce those deadlines, and rule on those motions after the stay is lifted. The Court is aware

that there are pending requests to extend those deadlines as it pertains to the deadline for

amending pleadings. In considering any such requests after the stay is lifted, the Court will

apply the standards set forth in Johnson v. Mammoth Recreations Inc., 975 F.2d 604 (9th Cir.

1992), to the deadlines currently set forth in the Case Management Order. Therefore, 

IT IS HEREBY ORDERED granting the Motion to Stay (Doc. 354) and staying all

further discovery and proceedings in this case, until the Court rules on Defendant Prescott

Valley’s pending Motion to Dismiss (Doc. 350).

IT IS FURTHER ORDERED vacating the Status Conference currently set for August

12, 2011.

DATED this 26th day of July, 2011.

 

Case 3:09-cv-08162-GMS Document 419 Filed 07/26/11 Page 3 of 3