Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_18-cv-01530/USCOURTS-casd-3_18-cv-01530-3/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:0078m(a) Securities Exchange Act

---

1 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

SECURITIES AND EXCHANGE 

COMMISSION, 

Plaintiff,

v. 

GANNON GIGUIERE, et al., 

Defendants. 

Case No.: 18-cv-1530-WQH-JLB

ORDER GRANTING IN PART AND 

DENYING IN PART DEFENDANT 

HACKETT’S MOTION TO REOPEN 

DISCOVERY 

[ECF NO. 193]

Before the Court is Defendant Andrew Hackett’s (“Hackett”) Motion to Reopen Fact 

Discovery. (ECF No. 193.) Plaintiff Securities and Exchange Commission (“SEC” or 

“Commission”) opposes the motion. (ECF No. 195.) For the reasons set forth below, 

Defendant Hackett’s motion is GRANTED IN PART and DENIED IN PART. 

I. BACKGROUND 

A. Factual Background

On July 6, 2018, the SEC filed a complaint against Defendants Gannon Giguiere, 

Oliver-Barret Lindsay, Andrew Hackett, Kevin Gillespie, and Annetta Budhu. (ECF No. 

1.) The SEC filed First and Second Amended Complaints on August 5, 2022, and April 7, 

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 1 of 13
2 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2023, respectively. (ECF Nos. 92, 136.) The Second Amended Complaint (“SAC”) 

alleges violations of Section 10(b) of the Securities Exchange Act (15 U.S.C. § 78(j)(b))

and Rules 10b-5(a) and (c) thereunder (17 C.F.R. §240.10b-5(a), (c)) resulting from a 

“pump and dump” scheme1 related to three penny stocks. The first claim for relief alleges 

that Defendants Giguiere and Lindsay engaged in fraud in connection with Kelvin Medical, 

Inc. (“KVMD”) stock. (ECF No. 136 at 25-26.) The second claim for relief alleges that 

Defendants Gillespie, Hackett, and Budhu engaged in fraud in connection with Arias Intel 

Corp. (“ASNT”) stock. (Id. at 26.) The third claim for relief alleges that Defendant 

Giguiere engaged in fraud in connection with Eco Science Solutions, Inc. (“ESSI”) stock. 

(Id. at 27.)

With respect to the alleged fraud relating to ASNT stock, the SAC alleges that in 

October 2017, Defendants Budhu, Gillespie, and Hackett agreed with a cooperating 

witness to promote the stock on TheMoneyStreet in connection with their planned pump 

and dump scheme. (Id. at 3.) The cooperating witness, without Defendants’ knowledge,

recorded phone calls and preserved encrypted email and text messages that Defendants

sought to hide from, among others, law enforcement. (Id.) In December 2017, the 

cooperating witness introduced Hackett to an individual who claimed to be the ringleader 

of a network of corrupt stockholders who would buy the ASNT stock from Hackett in their 

customers’ accounts, and without their customers’ knowledge, in exchange for a thirty 

percent kickback. (ECF No. 136 at 3.) Unbeknownst to Hackett, the purported ringleader 

1 In a “pump and dump” scheme: 

[A] group of individuals who control the “free trading” shares of an issuer 

with a thinly-traded stock . . . inflate the issuer’s share price and trading 

volume through, among other things, engaging in wash and matched trading, 

issuing false or misleading press releases, or paying for stock promotions. 

When the issuer’s share price reaches a desirable level or target price, the 

individuals “dump” their shares into the buying volume generated during the 

“pump” phase for substantial financial gain. 

(ECF No. 136 at 3 n.1.)

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 2 of 13
3 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

was an undercover FBI agent (“UC”). (Id.) Between December 22, 2017, and 

January 18, 2018, Hackett sold over 14,000 shares of ASNT stock in matched trades with 

the UC that he coordinated with the cooperating witness. (Id. at 4.) Specifically, Hackett 

coordinated 

trading with the UC in phone calls and encrypted message chats with the 

cooperating witness, in which he agreed to place sale orders of ASNT in 

substantially the same size, at the same time, and at substantially the same 

prices at which he understood the UC was placing his buy orders. 

(Id. at 17.) Hackett allegedly engaged in this scheme to liquidate his holdings and 

create a misleading appearance of active trading in ASNT. (Id.) 

B. Procedural Background2

 

On October 24, 2018, the Honorable William Q. Hayes stayed this case pending the 

resolution of the charges against the defendants in two parallel criminal proceedings, 

United States v. Giguiere et al., Case No. 18-cr-3071-WQH, and United States v. Hackett 

et al., Case No. 18-cr-3072-TWR. (ECF No. 44.) On August 2, 2021, a jury in Hackett’s 

criminal case found Hackett guilty of one count of conspiracy to commit securities fraud 

in violation of 18 U.S.C. § 371, and one count of securities fraud in violation of 15 U.S.C. 

§ 78j(b) and 78ff. See United States v. Hackett et al., Case No. 18-cr-3072-TWR, ECF 

Nos. 300-01. On June 9, 2022, Hackett was sentenced to forty-six months in prison. See 

id., ECF Nos. 412-13.

3

 The stay in the instant case was lifted on June 16, 2022. (ECF No. 

76.) 

On October 6, 2022, this Court issued a Notice and Order Setting Early Neutral 

Evaluation and Case Management Conferences. (ECF No. 97.) In accordance with that 

order, the SEC and defendants Giguiere and Hackett filed a Joint Discovery Plan on 

2 The Court sets forth only those proceedings relevant to the instant motion.

3 Hackett’s appeal of his conviction and sentence are currently pending before the Ninth 

Circuit. See United States v. Hackett, No. 22-50142 (9th Cir. filed June 23, 2022). The 

appeal was argued and submitted on August 21, 2023. Id., ECF No. 51. 

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 3 of 13
4 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

November 7, 2022. (ECF No. 98.)4 On December 7, 2022, this Court held an Early Neutral 

Evaluation Conference (“ENE”). (ECF Nos. 115–16.) The case settled in principle as to 

Defendants Giguiere and Budhu but did not settle as to Hackett. (ECF No. 115.) The 

Court held a Case Management Conference following the ENE and issued a Scheduling 

Order Regulating Discovery and Other Pre-Trial Proceedings (“Scheduling Order”) on 

December 9, 2022. (ECF No. 117.) The Scheduling Order required all fact and expert 

discovery to be completed by August 16, 2023. (Id.) 

On August 21, 2023, the Court issued an order addressing the Commission’s motion 

for leave to take Hackett’s deposition in prison, and Hackett’s motion for extension of time 

to complete discovery, in which he sought to conduct all discovery after his release to home 

confinement on October 16, 2023. (ECF No. 151.) The Court stated:

As Hackett has proffered that he will be released to home confinement in 

approximately two months, a relatively short time in the future, the Court finds 

good cause to briefly delay Hackett’s deposition so that he might have access 

to his documents to better prepare for his deposition. Accordingly, the Court 

will extend the discovery cut off to October 27, 2023. To the extent Hackett’s 

request is for a date beyond October 27, 2023, the motion is denied without 

prejudice for failure to fully set forth good cause. Specifically, Hackett has 

failed to specify why the additional discovery he intends to conduct is 

necessary and to what extent he has been diligent in conducting discovery

within the deadline set by the Court.

(Id. at 2–3.) 

On December 11, 2023, the Court conducted a Mandatory Settlement Conference 

(“MSC”), during which the SEC and Hackett reached a conditional settlement . (ECF No. 

165.) At the joint request of these parties, the undersigned Court held a further MSC on 

March 14, 2024, to mediate the parties’ impasse regarding a proposed consent and final 

4 Defendants Lindsay and Gillespie each settled with the SEC prior to the submission of 

the Joint Discovery Plan. (ECF Nos. 77, 79–80 [Lindsay]; ECF Nos. 88–90 [Gillespie].) 

Defendant Budhu refused to participate in the Federal Rule of Civil Procedure 26(f) 

conference. (ECF No. 98 at 2 n.1.) 

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 4 of 13
5 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

judgment. (ECF Nos. 186–188.) The Court directed the parties “to jointly call chambers 

to advise whether they have worked out the language of the settlement agreement or require

further assistance from the Court.” (ECF No. 188.) The parties did not contact chambers.

On April 10, 2024, Hackett filed the instant motion. (ECF No. 193.) The Court 

held a hearing on May 14, 2024. (ECF No. 209.) As determined at the hearing and

memorialized in a subsequent Minute Order, the Court granted Hackett leave to supplement 

his motion by May 15, 2024, to provide specific proposed discovery requests, address the 

relevance of the requests, and further address his due diligence efforts with respect to 

discovery regarding Alexander Smirnov and Mr. Nayflish. (ECF No. 210.) Hackett timely 

filed his supplemental brief. (ECF No. 212.) The Court granted the SEC until May 17, 

2024, to respond (ECF No. 210). The SEC did so. (ECF No. 213.) The Court did not 

authorize further briefing. Nonetheless, on May 20, 2024, Hackett filed a Reply (ECF No. 

215), which the SEC moved to strike. (ECF No. 216.) By separate Order, the Court grants 

the SEC’s motion to strike.

II. LEGAL STANDARDS

“District courts have ‘broad discretion to manage discovery and to control the course 

of litigation under Federal Rule of Civil Procedure 16.’” Hunt v. County of Orange, 672 

F.3d 606, 616 (9th Cir. 2012) (quoting Avila v. Willits Envtl. Remediation Trust, 633 F.3d 

828, 833 (9th Cir. 2011)). A scheduling order issued pursuant to Rule 16 is required to 

“limit the time to join other parties, amend the pleadings, complete discovery, and file 

motions.” Fed. R. Civ. P. 16(b)(3)(A). The schedule may be modified “only for good cause 

and with the judge’s consent.” Id. at R. 16(b)(4). The good cause standard under Rule 

16(b) “primarily considers the diligence of the party seeking the amendment.” Johnson v. 

Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th Cir. 1992). 

 “The pretrial schedule may be modified ‘if it cannot reasonably be met despite the 

diligence of the party seeking the extension.’” Zivkovic v. S. Cal. Edison Co., 302 F.3d 

1080, 1087 (9th Cir. 2002) (quoting Johnson, 975 F.2d at 609). “If the party seeking the 

modification ‘was not diligent, the inquiry should end’ and the motion to modify should 

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 5 of 13
6 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

not be granted.” Id. (quoting Johnson, 975 F.2d at 609). Parties must therefore “diligently 

attempt to adhere to [the] schedule throughout the . . . course of the litigation.” Jackson 

v. Laureate, Inc., 186 F.R.D. 605, 607 (E.D. Cal. 1999). 

In addition, when amendment of the schedule would reopen discovery, courts in the 

Ninth Circuit are required to consider the following factors:

1) whether trial is imminent, 2) whether the request is opposed, 3) whether the 

non-moving party would be prejudiced, 4) whether the moving party was 

diligent in obtaining discovery within the guidelines established by the court, 

5) the foreseeability of the need for additional discovery in light of the time 

allowed for discovery by the district court, and 6) the likelihood that the 

discovery will lead to relevant evidence.

City of Pomona v. SQM N. Am. Corp., 866 F.3d 1060, 1066 (9th Cir. 2017) (quoting United 

States ex rel. Schumer v. Hughes Aircraft Co., 63 F.3d 1512, 1526 (9th Cir. 1995)).

III. DISCUSSION

A. Parties’ Arguments 

Hackett moves to reopen fact discovery in this matter for the limited purpose of: 

[A]llowing discovery regarding ALEXANDER SMIRNOV, a Confidential 

Human [Source] (“CHS”) for the Federal Bureau of Investigation (“FBI”) and 

his involvement with the Defendant in this matter before the Court, including 

any recorded conversations with the Defendant regarding the relevant 

“scheme,” recorded conversations regarding Michael Forster (“cooperating 

witness”), recorded conversations with others regarding the Defendant and, 

or, the relevant “scheme,” in addition to any relevant discovery involving Mr. 

Smirnov’s trading activity, [and/or] his trading activity through the use of 

nominee accounts of foreign nationals, and any relevant documentation 

involving BORIS NAYFLISH and his trading activity relevant to the matter 

before the Court, and any relevant information involving both Mr. Smirnov 

and Mr. Nayflish and the following individuals: ALEKSANDR D. 

KOSTROV, DMYTRO FEDORENKO, PAVEL BOCHAROV, LIDIA

FOGEL, ANNA TIMAKINA, SPARTAK YADGAROV, MAXIM 

BASINSKI, AIRAT DAUTOV, OLEKSII V HORIACH, ALEXEY 

MINDRUL, ANDREI V. MASTILIN.5

 

5

 This is the discovery as described in Hackett’s Motion. In his supplement, he includes 

discovery requests beyond these confines, to include the deposition of Cem Can, “SEC 

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 6 of 13
7 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

(ECF No. 193 at 1.)

Hackett explains that following the March 14, 2024 Mandatory Settlement 

Conference, he became aware of the identity of a former confidential human source (CHS) 

named Alexander Smirnov through Smirnov’s indictment in Case Number 2:24-cr-00091-

ODW in the Central District of California. (Id. at 2.) He contends that the indictment 

against Mr. Smirnov alleges that as a CHS, Smirnov had been admonished that he was to 

provide truthful information to the FBI and was not to fabricate evidence. (Id.) According 

to Hackett’s investigation of Mr. Smirnov through public media sources, including the 

Washington Post and Associated Press, Smirnov “has been heavily involved in business 

[activities] within the stock markets, and is alleged to have fabricated his claims against 

President Joe Biden.”6

 (Id.) Hackett continues,

Moreover, he has had several business dealings with an associate Mr. Boris 

Nayflish [footnote omitted], whose name has already appeared in discovery 

turned over to the Defendant in the parallel criminal case to the matter before 

this Court. Additionally, Mr. Smirnov has several ties to several foreign 

countries such as Israel, Ukraine, Austria, and Czech Republic, among others. 

Upon the Defendant’s review of the Commission’s trading data for the 

relevant stock to this matter, several individuals are listed trading the relevant 

stock from brokerage accounts located in these foreign countries during the 

relevant time period. 

(Id. at 2–3.) Further, “the proposed discovery seeks to obtain relevant trading information 

from Smirnov and the 11 other individuals to adequately present a defense to the Plaintiff’s 

Blue Sheet Data regarding WRIT Media Group . . . from January 1, 2015 – January 1, 

2019,” and interrogatories to be directed to third party David Wolfson. (ECF No. 212 at 

3.) 6 The Court takes judicial notice of the Indictment in United States v. Alexander Smirnov, 

Case No. 2:24-cr-00091-ODW (C.D. Cal. Feb. 14, 2024), ECF No. 1. See Reyn’s Pasta 

Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006) (the Court may take 

judicial notice “of court filings and other matters of public record”). The indictment alleges 

that Smirnov provided false derogatory information to the FBI about President Biden and 

Hunter Biden in connection with the Burisma matter.

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 7 of 13
8 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

securities fraud cause of action.” (ECF No 212 at 4.) Hackett contends that there is good 

cause to reopen discovery based on the above. (Id. at 5.) Specifically, he argues that he 

“seeks discovery to identify Smirnov’s involvement in the subject security HVST/ASNT” 

(Id. at 4) and is entitled to pursue fact discovery relating to the “potential trading of the 

relevant stock ‘HVST’ and ‘ASNT’ by either Mr. Smirnov himself, or by one or more of 

his associates, recorded conversations with or about the cooperating witness and/or the 

Defendant,” as such discovery is “highly relevant to the Defendant’s defense.” (ECF No. 

193 at 3.) 

Addressing the question of diligence, Hackett argues that he was not made aware of 

Smirnov’s identity as an FBI CHS until March 2024. (ECF No 212 at 4.) Hackett was 

aware of the involvement of an “Alex” with respect to Hackett’s criminal case but did not 

know his full identity. (Id.) Hackett maintains that after he learned Alex Smirnov’s 

identity, he acted with immediate due diligence by contacting the SEC and the Department 

of Justice to seek relevant evidence. (Id.) 

The SEC opposes Hackett’s motion. (ECF No. 195.) The Commission contends 

that the motion “is an untimely and thinly veiled attempt to obtain disclosure that [Hackett]

apparently believes may be relevant to [his] [c]riminal [c]ase.” (Id. at 5.) The Commission 

also opposes the motion on the basis that information relating to the individuals identified 

by Hackett in his motion is not relevant to this case. (Id.) Specifically with respect to Mr. 

Smirnov, the SEC argues that the discovery is irrelevant because Smirnov was involved in 

a security called WRIT, while the case against Hackett arises out of the manipulation of 

ASNT (formerly HVST) stock. (ECF No. 213 at 4–6.) The SEC sates, “Based on the 

documents in the SEC’s investigative file for this matter and on consultation with the 

United States Attorney’s Office, the SEC is unaware of any involvement by Smirnov with 

respect to ASNT.” (Id. at 4–5.)

Further, the SEC argues that the requested discovery is irrelevant because liability 

in this case is established by the collateral estoppel impact of Hackett’s conviction in the

criminal case, which was based upon the same factual allegations. (ECF No. 213 at 3-4.)

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 8 of 13
9 

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

In addition, the SEC argues that Hackett has not sufficiently demonstrated diligence 

because he did not serve any document requests during the discovery period. (ECF No. 

195 at 6.) The SEC points out that, aside from Mr. Smirnov, Hackett seeks discovery 

related to 11 individuals that traded ASNT stock plus Liana Millhouse, David Wolfson, 

and Boris Nayflish, all of whom were identified in his criminal case, and some of whom 

were “featured prominently.” (Id. at 6, ECF No. 213 at 6.) The SEC further argues that 

Hackett has not offered an explanation of his lack of diligence as to discovery related to 

any of these individuals. (Id.) With respect to discovery related to Cem Can, the SEC 

argues that Hackett has offered no explanation of either relevance or diligence. (Id. at 6–

8.) Finally, with respect to Mr. Smirnov, the SEC argues that Hackett has failed to establish 

due diligence because he had received in discovery the two calls between “Alex” and 

himself and could have timely propounded discovery about the not-fully-identified “Alex” 

and/or WRIT. (Id. at 7.)

B. Analysis

For the reasons set forth below, as to most of the discovery sought by Hackett, he 

has established neither relevance nor diligence and has not otherwise sufficiently supported 

his request to reopen discovery. The Court addresses separately Hackett’s request to 

reopen discovery in order to obtain formal confirmation that Alexander Smirnov is the 

“Alex” that Defendant spoke with via recorded telephone, to obtain any discovery within 

the custody and control of the SEC of any involvement of Smirnov in the manipulation of 

ASNT (formerly HVST) stock, and to take Mr. Smirnov’s deposition.7

The Court largely agrees with the SEC’s arguments opposing Hackett’s motion to 

reopen discovery. First, as the Commission argues, this is not the appropriate forum to 

litigate whether the Department of Justice should have turned over information relating to 

7 As discussed below, the SEC confirms its understanding that the “Alex” that Defendant 

spoke to in recorded telephone calls is indeed Mr. Smirnov and asserts that “this issue is 

not in dispute[.]” (ECF No. 213 at 7.)

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 9 of 13
10

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Mr. Smirnov, or the other individuals identified by Hackett, in the criminal action. Any 

challenges to his criminal proceedings must be sought through his criminal case or other 

proper proceedings. See Fed. R. Crim. P. 32, 33–38; Fed. R. App. P. 4–5; 28 U.S.C. § 

2241 et seq. Indeed, criminal counsel, on behalf of Hackett, sent a letter to the U.S. 

Attorney’s Office in San Diego, the prosecuting agency, to request information about 

Smirnov in connection with Hackett’s criminal action. (ECF No. 196-3 (Dunnigan Decl., 

Ex. C, [letter from Carlton F. Gunn, Esq. to U.S. Attorney’s Office dated Apr. 4, 2024]).) 

In that letter, counsel requests any recordings, reports, or notes of any contacts between 

Smirnov and Hackett on the basis that they are potentially exculpatory and would have 

been relevant at Hackett’s criminal trial. (Id.) The letter requests a prompt response due 

to an upcoming deadline to file a motion for a new criminal trial based on new evidence. 

(Id.) 

Second, in this civil case, parties may only obtain discovery regarding any

nonprivileged matter that is relevant to any party’s claim or defense. Fed. R. Civ. P. 

26(b)(1). Hackett has not sufficiently demonstrated that most of the discovery he seeks is 

material to this action. The SEC did not identify Smirnov, Nayflish, or any of the other 

individuals listed by Hackett in its initial disclosures in this action “because the 

Commission did not–and does not–regard them as ‘likely to have discoverable information 

that the Commission may use to support its claims in this action.’” (ECF No. 195 at 6; see 

also ECF No. 196 at 1 (Dunnigan Decl. ¶ 2, (“The Commission’s initial disclosures do not 

identify any of the 13 individuals referenced in the Motion.”)); Fed. R. Civ. P. 26(a)(1) 

(requiring parties to provide identifying information “of each individual likely to have 

discoverable information . . . that the disclosing party may use to support its claims or 

defenses[.]”). Moreover, Hackett’s motion to reopen discovery provides no support

beyond mere speculation that the individuals named in his motion are relevant to this case. 

(See generally ECF No. 193.)

Third, Hackett has not shown that he has acted diligently with respect to discovery 

in this matter. Discovery had been concluded for five months by the time Hackett requested 

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 10 of 13
11

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the information he currently seeks and, according to the SEC, Hackett did not issue any 

document requests during the discovery period. (ECF No. 195 at 6.) This Court previously 

found that Hackett had not sufficiently demonstrated diligence during the discovery period. 

(See ECF No. 151 at 3.) Although Hackett contends that he did not learn of Mr. Smirnov’s 

identity until he read media reports following Smirnov’s February 14, 2024, indictment in 

the Central District, he acknowledges receiving a recorded call with a Russian man named 

“Alex” from the Government.

8

 (Dunnigan Decl., Ex. B, ECF No. 196-2 [email from 

Hackett to SEC’s counsel dated Mar. 25, 2024].) Hackett also acknowledges that Boris 

Nayflish’s name was revealed in discovery in his criminal case. (ECF No. 193 at 2.) The 

SEC asserts, and Hackett does not dispute, that the identities of the other individuals 

mentioned in Hackett’s requested discovery were also known to Hackett since at least the 

time of his criminal prosecution. (See ECF No. 195 at 6; ECF No. 213 at 6.) Yet neither 

“Alex” nor the fully named individuals are set forth in Hackett’s portion of the Joint 

Discovery Plan as witnesses to be deposed or as individuals about whom he wished to seek 

discovery (ECF No. 98), and he waited until well after the close of discovery to seek any 

discovery regarding these individuals. This does not demonstrate diligence. “If the party 

seeking the modification ‘was not diligent, the inquiry should end[.]’” Zivkovic, 302 F.3d 

at 1087 (quoting Johnson, 975 F.2d at 609). 

 Consideration of the City of Pomona factors leads the Court to the same conclusion. 

See City of Pomona, 866 F.3d at 1066. Although trial is not imminent, the SEC opposes 

the request to reopen discovery, the SEC would be prejudiced by the delay that would occur 

if discovery were reopened—especially in light of the age of the case, Hackett was not 

diligent in seeking discovery within the schedule issued by the Court, and the current record 

before the Court does not show that the information sought is likely to lead to relevant 

evidence. See id.

8 According to the SEC, this recording was provided to Hackett “years ago” as part of

discovery in his criminal case. (ECF No. 195 at 6.)

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 11 of 13
12

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Based on the above, the Court finds that Hackett has not demonstrated good cause 

to modify the scheduling order and reopen discovery for most of what he seeks. 

Even with respect to the discovery related to Mr. Smirnov, Hackett has made only 

the thinnest demonstration of potential relevance. Specifically, because Mr. Smirnov’s 

contact with Hackett was in the context of sales related to a different securities fraud 

scheme, it is highly unlikely that discovery related to Smirnov will yield anything relevant. 

However, where, as here, (1) the SEC has acknowledged that the prior criminal 

investigation targeting Hackett resulted in recorded calls between Hackett and Smirnov, 

acting as a CHS; and (2) Smirnov has been charged with providing false information to the 

FBI in another matter, the Court is inclined to give wider latitude. In addition, with respect 

to the discovery related to Mr. Smirnov, Hackett has offered a plausible proffer of

diligence: that Smirnov was not previously fully identified, and Hackett only recently 

learned that the FBI has accused him of dishonesty. (See ECF No. 193 at 2.) Therefore, 

the Court will reopen discovery for a brief period for the purpose of Hackett seeking to 

obtain very specific, limited discovery regarding Hackett. 

The SEC has already acknowledged that, to the best of their knowledge, the “Alex” 

in the recorded calls with Hackett is Alexander Smirnov. (ECF No. 213 at 7.) Discovery 

will be reopened, and: 1) Hackett will have until July 15, 2024, to propound either an 

interrogatory or a request for admission to elicit this fact formally from the SEC; 2) Hackett 

will have until July 15, 2024, to propound a request for production of documents for any 

documents the SEC has in its possession, custody or control related to Mr. Smirnov’s 

involvement in the manipulation, purchase, or sale of ASNT (formerly HVST) stock9

; 3)

9

 The Court notes that the SEC asserts, “Based on the documents in the SEC’s investigative 

file for this matter and on consultation with the United States Attorney’s Office, the SEC 

is unaware of any involvement by Smirnov with respect to ASNT” and “based upon a 

preliminary review, none of the documents in the SEC’s investigative file containing 

mention of Smirnov relate to ASNT . . . .” (ECF No. 213 at 4–5.)

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 12 of 13
13

18-cv-1530-WQH-JLB

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Hackett shall have 60 days to endeavor to take the deposition of Alexender Smirnov. 

Because the likelihood of relevant information being obtained from such a 

deposition is so low, because Hackett has not been diligent in pursuing discovery in this 

matter, and because of the age of this case, if Mr. Smirnov cannot be located, served, and 

deposed within this window, discovery will reclose, and the case will proceed without that 

deposition. 

IV. CONCLUSION

For the foregoing reasons, Defendant Hackett’s Motion to Reopen Fact Discovery 

[ECF No. 93] is GRANTED IN PART and DENIED IN PART. 

IT IS SO ORDERED. 

Dated: July 1, 2024

Case 3:18-cv-01530-WQH-JLB Document 222 Filed 07/01/24 PageID.<pageID>

Page 13 of 13