Once the cases have been found to be related, Local Rule 40.4(b) imposes four additional
conditions that must be satisfied before a case may be reassigned: 1) both cases must be pending in the
Northern District of Illinois; 2) reassignment must result in a substantial savings of judicial time and
effort; 3) “the earlier case has not progressed to the point where designating a later filed case as related
would be likely to delay the proceedings in the earlier case substantially;” and 4) the actions are
susceptible to disposition in a single proceeding. Both the Machinery Movers and the Ironworkers
actions are currently pending in the Northern District of Illinois, so the first criterion is easily satisfied.
The plaintiffs in the Ironworkers action also concede that the Machinery Movers case is in the relatively
early stages of litigation. Upon the parties’ joint motion, the proceedings in the Machinery Movers
action were stayed not long after the defendants answered the complaint. The Ironworkers action is also
in the very early stages of litigation; the complaint was filed on February 2, 2004 and Judge Guzman has
granted the defendants’ request to file their answer within five business days following this Court’s
decision on the motion to reassign. Therefore, the only two contentious issues regarding reassignment
are whether doing so will result in a substantial savings of judicial time and effort and whether the
actions are susceptible to disposition in a single proceeding.

The Ironworkers plaintiffs argue that we should deny the motion to reassign because the
defendants provide only conclusory statements as to how reassi ignment will result in substantial savings
of judicial time and resources. Local Rule 40.4(c) requires parties to “indicate the extent to which the
conditions required by section (b) will be met if the cases are found to be related.” Furthermore, “[t]he
judges of this Court have interpreted subsection (c) to impose an obligation on the moving party to
specifically identify why each of the four conditions for reassignment under LR 40.4(b) is met.”
Lawrence E. Jaffe Pension Plan v. Household Int'l, Inc., 02-C-5893, 2003 WL 2101 1757, at *3 (N.D.

Ill. May 5, 2003). Thus, a court may deny a motion to reassign if a party fails to sufficiently apply the



Car Rentals, Iac., 42 F. Supp.2d 846, 849 (N.D. Ill. 1999). As set forth above, although there is some

legal and factual overlap between the Ironworkers and Machinery Movers actions, the issues that are

unique to each case predominate. We thus find that reassignment is not appropriate.
CONCLUSION

is denied. It is so ordered.

ia

MARVIN E. ASPEN —
United States District Judge

For the foregoing reasons, Nationwide’s motion to reassj

Dated:



The Ironworkers Action is brought pursuant to the Racketeer Influence and Corrupt
Organizations Act, 18 U.S.C. § 1961, et seg. (“RICO”). However, several of the predicate acts which
underlie the RICO claims are premised upon alleged violations of ERISA. In Counts TIL, IV, and V, the
Ironworkers plaintiffs also request rescission of the allegedly fraudulent contracts entered into between
the funds and the defendants.

ANALYSIS

Northern District of Illinois Local Rule 40.4 provides for the reassignment of civil cases from
one judge to another if certain conditions have been met. First, under Rule 40.4(a), the cases must be
related. According to the mule, cases are related if they: 1) involve the same property; 2) involve the
same issues of fact or law; 3) grow out of the same transaction or occurrence; or 4) inaclass action, one
or more of the classes involved are the same. Nationwide argues that the Ironworkers and Machinery
Movers cases are related because they involve the same issues of fact or law.

Rule 40.4(a) “does not require complete identity of issues in order for cases to be considered
related,” Fairbanks Capital Corp. v. Jenkins, 02-C-3930, 2002 WL 31655277, at * 2 (N.D. II. Nov. 25,
2002), rather it is enough that the two cases “involve some of the same issues of fact or law.” Lawrence
E. Jaffe Pension Plan v. Household Int'l, Inc., 02-C-5893, 2003 WL 2101 1757, at *3 (N.D. Ill. May 5,
2003) (emphasis in original). Here, although there is very little overlap between the parties in each case,
the allegations contained in both complaints are quite similar and involve the same group of alleged
wrongdoers. Furthermore, although the central legal claims brought in each action appear to be different
- the Machinery Movers action claims violations of ERISA, whereas the Ironworkers action brings
claims under RICO - the predicate acts alleged in the RICO counts are based on underlying ERISA
violations. Because there are some overlapping issues of fact and law in both cases, they are related

within the meaning of 40.4(a).



facts of the case to each of 40.4(b)’s requirements. Jd. In this case, we agree that Nationwide’s
explanation regarding how reassignment will result in a substantial savings of judicial time and resources
is inadequate. Nationwide states only that “[t]he weight of common factual and legal issues... suggests
strongly that there will be a substantial conservation of judicial resources if one court considers and
decides those common issues . . . By contrast, permitting the cases to proceed on separate tracks would
result in duplication of (but not parallel or coordinated) discovery efforts, excess use of judicial
resources, and the possibility of incongruent factual rulings on identical contracts.” (Mem. in Support
of Nationwide’s Mtn. for Reassignment at 9.) Aside from offering these conclusory allegations,
Nationwide fails to specify how combining the cases will result in a substantial savings of judicial
resources, nor does it pinpoint what issues for discovery will be the same in both cases or what matters
are susceptible to disposition in a single proceeding. This failure to comply with Local Rule 40.4(c)’s
requirement that parties “indicate the extent to which the conditions required by section (b) will be met
if the cases are found to be related” is sufficient grounds, in and of itself, for denial of the motion to
reassign. We need not rely on this technical ground for denial, however, because the parties cannot meet
the requirements of Local Rules 40.4(b)(2), which requires that reassignment will result in a substantial
savings of judicial time and effort or 40.4(b)(4), which requires that the actions be susceptible to
disposition in a single proceeding.

First, comparison of the Ironworkers’ complaint with the Machinery Movers’ complaint reveals
that we should deny the motion for reassignment on the merits because reassignment would not result
in a substantial savings of judicial time and resources. First, although the schemes alleged in the two
cases are similar, both the plaintiffs and the defendants are different in each case. As the Ironworkers
plaintiffs point out, each of the cases is brought by a different group of plaintiffs and the only party

officially named in both actions as a defendant is Nationwide Investment Services Corporation. This



Minute Order Form (06/97)

United States District Court, Northern District of Illinois

h ssigned Jt 1 Sitting Judge if Oth:

vnye Magistrate Judge Marvin Aspen han Assigned Judge

CASE NUMBER 03 C 8707 DATE 7/15/2004
CASE Machinery Movers, et al vs. Joseph Anthony, Inc., et al
TITLE

[Un the following box (a) indicate the party filing the motion, e.g., plaintiff, defendant, 3rd party plaintiff, and (b) stat
of the motion being presented.]

e briefly the nature

qu)

MOTION:
a

DOCKET ENTRY:
qd) Qa Filed motion of [ use listing in “Motion” box above.]
(2) im) Brief in support of motion due
(3) a Answer brief to motion due___. Reply to answer briefdue__.
(4) oO Ruling/Hearingon__—_setfor_— at
(5) Oo Status hearing[held/continued to] [set for/re-set for]on___—s set for at
(6) oO Pretrial conference[held/continued to] {set for/re-set for]on__—ssetfor__—sat__
(7) a) Trial[set for/re-set for] on__at
(8) o [Bench/Jury trial] [Hearing] held/continuedto__—aatt
(9) im) This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]

OFRCP4(m) O Local Rule 41.1 C/FRCP41(a)(1) 0 FRCP41(a)(2).
qo) = [Other docket entry] Enter Memorandum Opinion and Order: Presently before us is Nationwide

Investment Services Corporation’s motion to reassign Case No. 04 C 821 pursuant to Local Rule 40.4 based on
that case’s alleged relatedness to a case currently pending before this Court. Nationwide also requests that we stay
all further proceedings in the Ironworkers action pending the non-appealable disposition of criminal cases which

have been filed against several of the parties and witnesses involved in the Ironworkers and Mach
actions. We deny the motion to reassign (19-1) and therefore do not address Nationwide’s moti

a [For further detail see order attached to the original minute order.]

inery Movers
on to stay.

No notices required, advised in open court.

No notices required.
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is because the Ironworkers plaintiffs chose to sue only legal entities associated with Nationwide; they
did not include Linder, Liz/Mar, or Joseph/Anthony as defendants. Furthermore, the two cases are
premised on different legal theories. The Machinery Movers complaint sets forth claims pursuant to
ERISA only, whereas the Ironworkers case is brought under RICO. There is some overlap between the
cases because the predicate acts which underlie the RICO action are premised on violations of ERISA.
However, the alleged ERISA violations make up just one element of a RICO claim. To succeed ina
RICO action, the Ironworkers plaintiffs must demonstrate that the defendants engaged in: 1) the conduct;
2) ofan enterprise; 3) through a pattern; 4) of racketeering activity. See Richmond v. Nationwide Cassel,
LP., 52 F.2d 640, 644 (7th Cir. 1995), The issues of whether the various Ironworkers defendants
comprised an “enterprise” within the meaning of RICO or whether the alleged ERISA violations
amounted to a pattern of racketeering activity are not at all relevant to the Machinery Movers action.
Furthermore, the Ironworkers plaintiffs have also brought rescission claims that are unrelated to the
Machinery Movers case. All of these issues would have to be dealt with separately in the Ironworkers
action, and the reassignment of the case to this Court’s calendar would not make the proceedings any
more efficient this respect. In short, although there may be some judicial resources saved by bringing
together the two actions, there will not be the “substantial saving of judicial time and effort” that is
contemplated by Rule 40.4. See L.R. 40.4(b)(2) (emphasis added); see also Lawrence E. Jaffe Pension
Plan, 2003 WL at *2 (emphasizing that the saving of judicial time and effort must be substantial in order
for reassignment to be appropriate under Rule 40.4(b)(2)).

These same considerations lead us to find that Nationwide has not satisfied its burden of
demonstrating that Rule 40.4(b)’s fourth requirement - that the cases are amenable to disposition in a
single proceeding - is met. Courts have held that cases are not susceptible to disposition in one

proceeding where both cases present unique issues of law and fact. Id. at 3; see also Clark v. Insurance



UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

MACHINERY MOVERS, RIGGERS,
AND MACHINERY ERECTORS, LOCAL
136 DEFINED CONTRIBUTION
RETIREMENT FUND, et al.,

Plaintiffs,
No. 03 C 8707
Vv.

JOSEPH/ANTHONY, INC., a/k/a
JOSEPH ANTHONY & ASSOCIATES,
INC., et al.,

DOCKETER

JUL ¥ 6 2004

SESS SSS SSS

Defendants.

MEMORANDUM OPINION AND ORDER

MARVIN E. ASPEN, District Judge:

Presently before us is Nationwide Investment Services Corporation’s (“Nationwide’s”) motion
to reassign Case No. 04 C 0821 (the “Ironworkers” action) pursuant to Local Rule 40.4 based on that
case’s alleged relatedness to a case currently pending before this Court, Case No. 03 C 8707 (the
“Machinery Movers” action). Nationwide also requests that we stay all further proceedings in the
Tronworkers action pending the non-appealable disposition of criminal cases which have been filed
against several of the parties and witnesses involved in the Ironworkers and Machinery Movers actions.
For the following reasons, we deny the motion to reassign the case and therefore do not address
Nationwide’s motion to stay.

BACKGROUND
A. The Machinery Movers Action
The plaintiffs in the Machinery Movers action are a group of employee benefit funds (the

“Machinery Movers Funds”) that are administered pursuant to collective bargaining agreements between


Machinery Movers, Riggers and Machinery Erectors, Local 136 (the “Machinery Movers Union”) and
various employers. The Machinery Movers Funds, along with their trustees, filed suit against:
Joseph/Anthony, Inc. (“Joseph/Anthony”); Nationwide Investment Services Corporation (“Nationwide”);
Liz/Mar and Associates, Inc. (“Liz/Mar”); and Michael Linder, the President of both Joseph/Anthony
and Liz/Mar. According to the complaint, Joseph/Anthony was the administrator of the Machinery
Movers Funds. The plaintiffs allege that, as President of J loseph/Anthony, Michael Linder recommended
that the trustees select Nationwide to receive all of the funds’ future investments. Unbeknownst to the
plaintiffs, Linder (via Joseph/Anthony) received unauthorized commissions from Nationwide for
bringing the in funds’ business. The complaint also alleges that Linder set up another entity, Liz/Mar,
which received additional unauthorized commission payments from Nationwide. The plaintiffs claim
that the scheme set up by Linder via Joseph/Anthony and Liz/Mar violated various provisions of the
Employee Retirement Income Security Act, 29 U.S.C. § 1001, et seg. (“ERISA”).

B. The Ironworkers Action

The Ironworkers action is brought by a different group of plaintiff benefit funds and their
trustees. The suit names as defendants: Nationwide Life Insurance Company; Nationwide Financial
Services, Inc.; Nationwide Trust Company, FSB; Nationwide Financial Institution Distributors Agency,
Inc.; and Nationwide Investment Services Corporation. Paragraph 13 of the Ironworkers action provides
a summary of the allegations brought against the defendants:

While the Nationwide Defendants are separate legal entities, upon information and

belief, some or all of them, along with persons and corporations acting as their

employees or agents, acted to deprive the Plaintiff Funds and their participants of money

that should have been invested on their behalf, through a scheme in which the

Nationwide Defendants deducted money from Fund assets and paid fees, kickbacks,

commissions, or other things of value to Michael G. Linder (“Linder”) Liz/Mar and

Associates, Inc. (“Liz/Mar”), and/or Joseph/Anthony & Associates, Inc.

(“Joseph/Anthony”), in return for Linder’s recommendation that the Funds invest their
assets with Nationwide.