Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_12-cv-00930/USCOURTS-casd-3_12-cv-00930-4/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:1332fr Diversity-Fraud

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

ANDREW NILON, individually and

on behalf of all other similarly

situated, 

Plaintiff,

vs.

NATURAL-IMMUNOGENICS

CORP.; and DOES 1-25, Inclusive,

Defendant.

______________________________

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Case No: 3:12-cv-00930-LAB (BGS)

REPORT AND RECOMMENDATION

RE: DENIAL OF DEFENDANT’S

MOTION FOR CONTEMPT AND

SANCTIONS

[ECF No. 67.]

I. INTRODUCTION

Pending before the Court is Defendant Natural Immunogenics’ Motion for

Contempt and Imposition of Sanctions against attorneys Scott Ferrell, Ryan Ferrell and

Victoria Knowles, who are former counsel for former class representative Andrew

Nilon. Natural Immunogenics seeks to hold Mr. Nilon’s former counsel in contempt

for failure to comply with the July 31, 2014 Order of the Court to produce Mr. Nilon

for deposition. [ECF No. 67.] Pursuant to 28 U.S.C. § 636(e), the Court has reviewed

the parties’ briefs, declarations and exhibits and RECOMMENDS Defendant’s

Motion for Contempt and Sanctions be DENIED.

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II. PROCEDURAL AND FACTUAL BACKGROUND 

On June 30, 2014, Defendant filed a motion to compel the deposition of Andrew

Nilon. [ECF No. 49.] The motion also sought responses to written discovery. At the

time Defendant filed its motion, Mr. Nilon was the only class representative in this

matter. On July 9, 2014, while briefing was underway with respect to the motion to

compel, Plaintiff filed a motion to substitute another member of the certified class, Mr.

Giovanni Sandoval, for Mr. Nilon. [ECF No. 52.] The motion to substitute class

representative was set to be heard before the Honorable Larry A. Burns. 

On July 31, 2014, Magistrate Judge Skomal issued an order granting in part and

denying in part Defendant’s motion to compel. The Court explained its reasoning in

ordering Mr. Nilon’s deposition as follows:

“While the Court acknowledges that Mr. Nilon currently has a motion to

substitute a new class representative in this action, he, nevertheless, is still the

named Plaintiff in this matter and as a party, Defendant is entitled to take his

deposition. Fed. R.Civ. P. 30(a)(1). Therefore, the Court GRANTS

Defendant’s motion to compel the deposition of Andrew Nilon. Mr. Nilon will

sit for his deposition no later than August 15, 2014. See Dysthe v. Basic

Research, L.L.C., 273 F.R.D. 625 (C.D. Cal 2011) (holding that the named

plaintiff in a class action was subject to deposition despite the fact that he had a

pending motion to be dismissed from the action because his anticipated

testimony was relevant to class certification issues as well as the merits of the

consumer claims against the defendants’ weight-loss products.)”

See ECF No. 55 at 6:17-7:4.

On August 15, 2014, Plaintiff’s counsel, Ryan Ferrell, filed a motion to

withdraw as attorney for Andrew Nilon. [ECF No. 61.] At the time of its filing, the

motion to substitute class representative had been taken under submission by Judge

Burns. [ECF No. 60.] In the declaration filed in support of the motion to withdraw,

Attorney Ferrell indicated that he had been unable to contact Mr. Nilon as of July

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2014. [ECF No. 61-2 at ¶4.] Specifically, Attorney Ferrell stated that: (1) his repeated

phone calls to Mr. Nilon went unanswered; (2) there was no response from Mr. Nilon

to three letters that Attorney Ferrell sent requesting contact; and (3) no one answered

the door at Mr. Nilon’s last known address. [Id. at ¶¶4-7.] In the motion to withdraw,

Attorney Ferrell also suggested that “once the motion to substitute and the motion to

withdraw are granted[,] Defendant will desire to then take the deposition [of Giovanni

Sandoval] that has already been offered.” [ECF No. 61-1 at4:8-9.]

On August 20, 2014,1

 The Honorable Larry A. Burns granted Plaintiff’s motion

to substitute class representative, ruling as follows:

“First, the discovery deadline is not a large problem because the Court can

extend it. In fact, Nilon’s motion seeks to modify the governing scheduling

order, and Judge Skomal’s order compelling the deposition of Nilon required

that it take place by August 15, 2014. Second, Nilon’s mere failure to appear for

a deposition is something for which his counsel has already been admonished

and sanctioned by Judge Skomal. Third, and most importantly, the Court’s mind

the potential for prejudice arises where a plaintiff seeks to start a case all over

again and negate work that’s already been done, or gain a tactical advantage in

litigation. See Velazquez v. GMAC Mortg. Corp., 2009 WL 2959838 at *4 (C.D.

Cal. Sept. 10, 2009). There’s no threat of that here. Whether it’s Nilon or

Sandoval, Nilon-Immunogenics still has to depose the lead plaintiff in this case,

and as between the two of them their claims with respect to Sovereign Silver and

their requests for relief are identical. The only difference is when and where

they bought the product....it would seem that substituting Sandoval into this case

as lead plaintiff offers a corrective to the grievances of Natural-Immunogenics. 

Alas, they will have a lead plaintiff who takes his responsibility seriously, and

1

The Order Granting Plaintiff’s motion to substitute class representative was signed by

Judge Burns on August 20, 2014, but docketed on the court’s Electronic Case Filing system by

the Clerk’s Office on August 22, 2014. See ECF No. 62 at p. 8.

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who is immediately willing to sit through a deposition and respond to written

discovery.”

See ECF No. 62 at 5:14-6:13.

In the August 20, 2014 Order, Judge Burns also granted the pending motion of

Attorney Ferrell and his firm, Newport Trial Group , to withdraw as attorneys for Mr.

Nilon. Id. at 8:4-5.

III. STANDARD OF REVIEW

In a civil contempt proceeding, “[the moving party has the burden of showing by

clear and convincing evidence that the condemners violated a specific and definite

order of the court.” FTC v. Affordable Media, 179 F.3d 1228, 1239 (9th Cir.1999). A

court may exercise its civil contempt power for either of the following purposes: “to

coerce the [party] into compliance with the court's order, and to compensate the

complainant for losses sustained.” United States v. United Mine Workers of America,

330 U.S. 258, 303-304, 67 S.C. 677, 91 LED. 884 (1947). 

A party may be held in contempt even if its conduct was not willful. Reno Air

Racing Assen, Inc. v. Accord, 452 F.3d 1126, 1130 (9th Cir.2006) (citations omitted). 

Accordingly, there is no good faith exception to the requirement of obedience to a

court order. Go-Video v. Motion Picture Assen of America, 10 F.3d 693, 695 (9th

Cir.1993). Nevertheless, substantial compliance is a defense to an action for civil

contempt. Bala v. Idaho State Board of Corrections, 869 F.2d 461, 466 (9th Cir.1989). 

Specifically, once it has been demonstrated that a party has violated a specific and

definite court order, the burden shifts to the party sought to be held in contempt to

prove that it “took all reasonable steps within [its] power to insure compliance.” Id.;

see also Hook v. Arizona Depot of Corrections, 107 F.3d 1397, 1403 (9th Cir.1997). 

Where a party has taken all reasonable steps to comply with an order, technical or

inadvertent violations will not support a finding of civil contempt. General Signal

Corp. v. Donallco, Inc., 787 F.2d 1376, 1379 (9th Cir.1986).

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IV. DISCUSSION

Natural-Immunogenics has shown a violation of the Court’s July 31, 2014 order

requiring Andrew Nilon to attend his deposition no later than August 15, 2014.2 But,

this violation is hypertechnical when considering the facts and circumstances of this

case. It is undisputed that the attorneys at Newport Trial Group filed a motion to

substitute class representative on July 9, 2014, while Defendant’s motion to compel

deposition was still pending. [ECF Nos. 49, 51.] The motion to substitute formally

informed opposing counsel and the Court that Mr. Nilon no longer wished to perform

his duties as a class representative and wanted to officially withdraw from this role.

The District Court had not yet ruled on the motion for substitution when the

court ruled that a deposition of the class representative must go forward. Plaintiff’s

attorney, therefore, used the time in July and August to try to regain contact with Mr.

Nilon by telephone, by mail and by sending an investigator to his home.3

 [See Ferrell

Decl. in support of Opp’n, ECF No. 68-1 at ¶¶4-7.] Defendant does not dispute that

Plaintiff’s attorney made these various attempts at contact.4

 Unfortunately, none of

these approaches was fruitful. As a result, on August 15, 2014, Plaintiff’s counsel filed

the motion to withdraw as counsel of record for Mr. Nilon. [ECF No. 61.] The motion

to withdraw, as well as the motion to substitute class representative, was granted by the

District Court just five days later on August 20, 2014. [ECF No. 62.] 

Defendant’s motion for contempt asks the court to beat a dead horse by now

sanctioning Mr. Nilon’s former counsel for its failure to secure the deposition of a

2

 The current class representative Giovanni Sandoval was scheduled for deposition on

October 24, 2014. Ferrell Decl. in support of Opp’n, ECF No. 68-1 at ¶8.

3

 The court took this matter under submission based on the briefing and declarations filed

in support. ECF No. 71; see Peterson v. Highland Music, 140 F.3d 1313, 1324 (9th Cir. 1998)

(“[W]here ...affidavits offered in support of a finding of contempt are uncontroverted, ... a district

court’s decision not to hold a full-blown evidentiary hearing does not violate due process.) 

4

Natural-Immunogenics did not file a reply brief in support of its Motion for Contempt.

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former class representative despite the fact that Attorney Ryan Ferrell substantially

complied with the court’s July 31, 3014 order by making repeated phone calls, mailing

three letters and sending an investigator to Mr. Nilon’s last known address to establish

compliance before the fast approaching August 15, 2014 deadline. It is the court’s

view that the Newport Trial Group’s several, yet unsuccessful, attempts to track Mr.

Nilon down for deposition in the short few days before he was formally substituted out

as class representative and counsel was formally relieved of their duties as his attorney

constitute exactly the type of technical violation that does not support a finding of civil

contempt. IT IS THEREFORE RECOMMENDED that Defendant’s Motion for

Contempt and Sanctions be DENIED. 

V. CONCLUSION

As detailed above, the undersigned Magistrate Judge RECOMMENDS that

Natural-Immunogenics’ Motion for Contempt and Imposition of Sanctions against

Newport Trial Group attorneys Scott Ferrell, Ryan Ferrell and Victoria Knowles be

DENIED. This Report and Recommendation is submitted to the United States District

Judge assigned to this case, pursuant to the provision of 28 U.S.C. section 636(e).5

IT IS ORDERED that no later than November 14, 2014 any party to this action

may file written objections with the Court and serve a copy on all parties. The

document should be captioned “Objections to Report and Recommendation.” 

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As provided in 28 U.S.C. § 636(e), this court does not have authority to issue contempt

sanctions. Only the District Judge has the authority to enter a finding of contempt when the

parties have not consented to the magistrate judge presiding over all proceedings. 28 U.S.C. §

636(e)(6)(B).

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IT IS FURTHER ORDERED that any reply to the objections shall be filed

with the Court and served on all parties no later than November 28, 2014. The parties

are advised that failure to file objections within the specified time may waive the right

to raise those objections on appeal of the Court’s order. See Turner v. Duncan, 158

F.3d 449, 455 (9th Cir. 1998).

DATED: October 30, 2014

Hon. Bernard G. Skomal

U.S. Magistrate Judge

United States District Court

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