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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Wells Fargo Bank NA,

Plaintiff,

v. 

Wyo Tech Investment Group LLC, et al.,

Defendants.

No. CV-17-04140-PHX-DWL

ORDER 

A group of non-party subpoena recipients (“the Subpoenaed Individuals”) has filed 

a motion for recusal. (Doc. 204.) For the following reasons, the motion will be denied.

BACKGROUND

This is a civil interpleader action in which two sets of adversaries—(1) Wyo Tech 

Investment Group LLC (“Wyo Tech”) and (2) CWT Canada II Limited Partnership, 

Resource Recovery Corporation, and Jean Noelting (collectively, the “Judgment 

Creditors”)—are fighting over $546,282.55. The procedural and factual background is 

summarized in earlier orders (Docs. 94, 119), so only a brief recap is necessary here. 

In 2016, the Judgment Creditors obtained a $7 million judgment against Dennis 

Danzik in New York state court. 

In October 2017, the Judgment Creditors attempted to collect on a portion of the 

outstanding judgment by freezing a bank account at Wells Fargo, which had a balance of 

$546,282.55. Notably, this account wasn’t held in Danzik’s name. Instead, it was held in 

the name of Wyo Tech. To freeze the account, the Judgment Creditors’ attorneys utilized 
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an unusual procedural tool known as a “restraining notice,” which is governed by section 

5222 of the New York Civil Practice Law and Rules.

Wyo Tech protested when it learned its account had been frozen, arguing that it had 

no connection with Danzik and that Wells Fargo should immediately release the frozen 

funds. In response, Wells Fargo filed an interpleader action in this court. Functionally, 

this meant that Wells Fargo deposited the disputed funds into the Court’s bank account so 

the Court could referee the fight between Wyo Tech and the Judgment Creditors over who 

has the superior entitlement to the funds.

The interpleader action was filed in November 2017 and initially assigned to a 

different judge. (Doc. 1.) In October 2018, it was reassigned to the undersigned judge. 

(Doc. 93.) This reassignment was part of the initial wave of case reassignments triggered 

by the undersigned judge’s appointment to the bench. 

One of the key disputed issues in this case has been whether the Judgment Creditors 

should be entitled to conduct discovery concerning their theory that Danzik secretly 

controls Wyo Tech or otherwise has an interest in Wyo Tech’s funds. In a lengthy order 

issued in April 2019, the Court concluded that the Judgment Creditors should be entitled 

to pursue such discovery. (Doc. 119.) 

The litigation since this discovery ruling has been quite contentious. For example:

▪ On May 15, 2019, the Judgment Creditors filed an amended motion to hold Wyo 

Tech’s counsel in civil contempt for, inter alia, failing to respond to certain subpoenas. 

(Doc. 135.) On May 29, 2019, following a hearing, the Court declined to make a contempt 

finding. (Doc. 155.) 

▪ On June 19, 2019, the Judgment Creditors filed another motion seeking civil 

contempt sanctions. (Doc. 159.) This motion was directed at a group of seven non-party 

subpoena recipients (different from the Subpoenaed Individuals) who had failed to respond 

to subpoenas requesting financial and other records. (Id.) On June 27, 2019, the Court 

held a hearing on this motion, which none of the subpoena recipients chose to attend. (Doc. 

166.) Accordingly, the Court issued an order holding the seven non-parties in civil 
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contempt and imposing daily fines until the documents were produced. (Doc. 167.) 

▪ On August 2, 2019, the Judgment Creditors filed a motion in which they 

acknowledged that six of the seven non-parties had produced the subpoenaed documents 

following the issuance of the contempt order but nevertheless requested that the Court issue 

an order compelling those non-parties’ immediate imprisonment. (Doc. 183.) On August 

6, 2019, the Court denied this motion in relevant part and refused to order anybody’s 

imprisonment. (Doc. 186.) The Court did, however, set a further show-cause hearing 

concerning one of the non-parties—a company called Danzik Applied Sciences, LLC 

(“DAS”), whose only member is Danzik’s wife, Elizabeth Danzik—that had been held in 

civil contempt in the June 27, 2019 order because there were unresolved questions 

concerning whether DAS had subsequently complied with the subpoena. (Id.)

DISCUSSION

The Subpoenaed Individuals are a group of additional non-parties who have 

received subpoenas from the Judgment Creditors. As an attachment to their recusal motion, 

they have filed a motion to quash those subpoenas (Doc. 204-2). 

The Subpoenaed Individuals first seek recusal because (1) the undersigned judge 

“reportedly was and is a close friend of” an attorney who currently works at the U.S. 

Attorney’s Office (“USAO”), (2) that attorney’s brother is a partner at a private law firm 

in Phoenix, and (3) an attorney from that law firm (but not the brother of the friend) is 

serving as local counsel for the Judgment Creditors in this case. (Doc. 204 at 1-4.) 

This argument lacks merit. Although it may be appropriate for a judge to consider 

recusing from a case in which one of the attorneys is a close personal friend,1the 

Subpoenaed Individuals have not identified any authority suggesting that recusal is 

necessary when a judge’s friend’s brother’s law partner is serving as local counsel in a case

(or when the judge’s friend’s brother may have an indirect financial interest in the case). 

 

1 See, e.g., United States v. Murphy, 768 F.2d 1518, 1537-38 (7th Cir. 1985) (noting 

that “a judge need not disqualify himself just because a friend—even a close friend—

appears as a lawyer” but holding that recusal should have occurred in particular case 

because the judge and prosecutor were “the best of friends” and “had secret plans to take a 

joint vacation immediately after trial”).
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Indeed, such a rule would presumably mean that a judge in a small legal community would 

never be able to hear a case. United States v. Bayard, 2010 WL 560666, *1 (D.N.H. 2010) 

(“As is generally the case in small states, judges and lawyers are familiar with one another. 

. . . No objectively reasonable person, fully informed of the relevant facts, would have 

reason to doubt my impartiality in this case.”).

Second, the Subpoenaed Individuals contend that recusal is necessary under 28 

U.S.C. § 455(b)(3) because Danzik was the subject of a criminal investigation by the 

USAO “[a]t the time Judge Lanza was heading up the criminal division of the USAOArizona.” (Doc. 204 at 2.) The Subpoenaed Individuals further assert that “[t]he law firm 

of Wilenchik & Bartness . . . represented Dennis Danzik with respect to the USAOArizona’s investigation of him.” (Id. at 3.) Thus, the Subpoenaed Individuals argue that 

“Judge Lanza was clearly involved, either personally or due to his supervisory 

responsibilities, with the Danzik investigation.” (Id. at 4-5.) The Subpoenaed Individuals 

also contend the Court’s previous “rulings on various discovery issues, including its 

imposition of sanctions on other nonparty investors who were previously subpoenaed, . . . 

might well appear to a reasonable onlooker [to be proof] that Judge Lanza has been swayed 

by his prior knowledge of Dennis Danzik.” (Id. at 3-4.)

These arguments are unavailing. As a threshold matter, no reasonable observer 

could view the discovery rulings in this case as proof of bias against Danzik. As noted, the 

Court rejected the Judgment Creditors’ request to hold Wyo Tech’s counsel in civil 

contempt, rejected the Judgment Creditors’ request for an order of imprisonment, and only 

held the other group of non-parties in civil contempt after they inexplicably chose not to 

submit any briefs defending their conduct or show up for the show-cause hearing. Cf. In 

re Apex Oil Co., 981 F.2d 302, 304 (8th Cir. 1992) (a reasonable person would not question 

a judge’s impartiality when a judge rules contrary to the alleged bias). 

On the merits, the plain language of section 455(b)(3) makes clear that recusal is 

necessary only when a judge, while in prior government practice, participated in the actual 

“proceeding” or “particular case in controversy” that is now pending before that judge. Id.
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(“[The judge] shall . . . disqualify himself . . . [w]here he has served in governmental 

employment and in such capacity participated as counsel, adviser or material witness 

concerning the proceeding or expressed an opinion concerning the merits of the particular 

case in controversy.”). This means that a judge who was once an Assistant U.S. Attorney 

(“AUSA”) cannot, after appointment to the bench, preside over a criminal case that he or 

she personally investigated or prosecuted while at the USAO. See, e.g., United States v. 

Smith, 775 F.3d 879 (7th Cir. 2016). But this isn’t a criminal case—it’s a civil interpleader 

action, Danzik isn’t even a party, and the narrow issue to be resolved is whether the 

Judgment Creditors are entitled to funds that had been deposited in Wyo Tech’s account. 

Section 455(b)(3) doesn’t apply in this circumstance. United States v. Lara-Unzueta, 735 

F.3d 954, 959 (7th Cir. 2013) (“The proceeding means the current proceeding. This 

interpretation is dictated by the text of the statute.”) (emphasis in original).

This isn’t a mere technical distinction. The Court isn’t being asked in this case to 

decide whether Danzik actually engaged in any criminal or other misconduct. To the 

contrary, the Judgment Creditors already have a $7 million judgment against Danzik that 

was issued by a New York state court2—a judgment that is entitled to respect under the 

Full Faith and Credit Clause of the U.S. Constitution—and the narrow issue to be decided 

is whether Danzik had an interest in the funds held in Wyo Tech’s bank account. The 

Subpoenaed Individuals have not alleged that the prior criminal investigation of Danzik by 

the USAO had anything do to with Danzik’s relationship (if any) with Wyo Tech.

3

 This 

 

2 The undersigned judge is not blind to the fact that the judge in the New York state 

matter held Danzik in civil and criminal contempt and concluded that Danzik is the 

“epitome of a recalcitrant, contemptuous, and incorrigible litigant” who “lie[d],” 

“deliberately did not disclose” relevant records, “coerced [a witness] into submitting false 

affidavits,” and “perjured himself before a Canadian bankruptcy court.” (Doc. 89-3 at 9-

10, 12, 13.) However, the undersigned judge learned that information through participation 

in this case, and “[k]nowledge obtained in the course of earlier participation in the same 

case does not require that a judge recuse himself.” United States v. Winston, 613 F.2d 221, 

223 (9th Cir. 1980).

3 Specifically, the Subpoenaed Individuals contend the USAO was “investigating 

Dennis Danzik for various alleged crimes related to tax credits received by RDX which 

[the Judgment Creditors] claim[] should have been paid to [them]—even though the entire 

premise and basis for seeking those tax credits rested on fraudulent representations and 

actions by [the Judgment Creditors] related to a bogus biodiesel production facility it 

deceived RDX into purchasing from it.” (Doc. 204 at 2-3.)
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further undermines their claim for recusal. Cf. United States v. Outler, 659 F.2d 1306, 

1312-13 (5th Cir. 1981) (magistrate judge not required to recuse when presented with an 

application for a search warrant concerning the defendant’s medical practice, even though 

the magistrate judge had prosecuted the defendant for a different medical-related offense 

two years earlier while serving as an AUSA, because recusal is required “only when the 

two proceedings have a common, single transaction or event at issue”).

The undersigned judge will further note that he has no recollection of discussing or 

participating in any criminal investigation of Danzik while at the USAO.

4

 Indeed, had the 

name “Danzik” rung a bell at the time the undersigned judge inherited this case, he would 

have disclosed that potential connection to the parties so they could make their own 

assessment of whether to file recusal motions. On that note, it is telling that the law firm 

representing Wyo Tech in this matter (Wilenchik & Bartness), which is alleged to have 

served as Danzik’s counsel during the criminal investigation and which has characterized 

“[t]he instant case [as] one of several, approximately seven (7) litigation cases relating to 

Mr. Dennis Danzik . . . in some form or another, which [Wilenchik & Bartness] is handling”

(Doc. 140 at 6), hasn’t raised any recusal-related concerns during the last year of litigation.5

 

4 To be clear, the undersigned judge does not know whether such an investigation 

occurred—the Court simply accepts the Subpoenaed Parties’ representation that Danzik

was the subject of an investigation. 

5 The Court further notes that, had Wyo Tech attempted to file a recusal motion at 

this late juncture of the case, such a motion would have been untimely. “It is well

established in this circuit that a recusal motion must be made in a timely fashion.” E. & J. 

Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280, 1295 (9th Cir. 1992). Such a requirement 

exists to lessen the “risk that litigants would use recusal motions for strategic purposes.” 

Id. (quotation omitted). See also United States v. Rogers, 119 F.3d 1377, 1380 (9th Cir. 

1997) (“[A] party having information that raises a possible ground for disqualification 

cannot wait until after an unfavorable judgment before bringing the information to the 

court’s attention.”). Here, because the only entities formally seeking recusal are the 

Subpoenaed Individuals (who had no prior involvement in this case), their motion will not 

be denied on timeliness grounds. That said, the motion is predicated on information that 

likely came from Wyo Tech and Danzik (and that Wyo Tech’s counsel, Wilenchik & 

Bartness, must have known at the time this case was reassigned to the undersigned judge). 

The Subpoenaed Individuals would have no other way of knowing about non-public 

criminal investigations that didn’t result in charges. Further, the proposed order granting 

the recusal motion was emailed to the Court’s chambers email address by Wyo Tech’s 

counsel, not by the Subpoenaed Individuals’ counsel. See Exhibit A. Such coordination 

raises the possibility that Wyo Tech is using the Subpoenaed Individuals as a stalking horse 

to evade the time limits on recusal motions.
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In any event, from January 2015 to September 2018, the undersigned judge served 

in the role of Chief/Executive AUSA at the USAO (and not “head of the entire criminal 

division,” as the Subpoenaed Individuals state in their motion). This is not a position that 

typically involves day-to-day supervision of individual criminal investigations. Such 

investigations are conducted by line AUSAs, who in turn report to section chiefs, who 

report to the criminal chief, who in turn is supervised by the Chief/Executive AUSA. This 

is relevant because “an AUSA who occupied a supervisory position in the U.S. Attorney’s

Office during the prosecution is not later required to recuse herself solely on that basis.” 

United States v. Ruzzano, 247 F.3d 688, 695 (7th Cir. 2001), overruled on other grounds 

by Fowler v. Butts, 829 F.3d 788 (7th Cir. 2016). Rather, “§ 455(b)(3) requires recusal 

only when the supervisor actually participated in a case.” United States v. Champlin, 388 

F. Supp. 2d 1177, 1181 (D. Haw. 2005).6 

The next, and ostensibly related, reason the Subpoenaed Individuals seek recusal 

under section 455(b)(3) is that “[a]s part of his efforts to exonerate himself and explain his 

situation, Dennis Danzik reached out to Congressman David Schweikert to see if he or 

someone from his office could introduce him to someone ‘at the right level’ within the 

USAO-Arizona. Congressman Schweikert’s Chief of Staff . . . contacted a Mr. Lopez at 

the USAO-Arizona to make that introduction and, as a result, Dennis Danzik was 

ultimately able to speak directly to Mr. (now Judge) Lanza.” (Doc. 204 at 3.) 

Before receiving the recusal motion, the undersigned judge had no recollection of 

ever having a phone conversation with Danzik. (Again, had the name “Danzik” rung a bell

at the outset of this case, the undersigned judge would have informed the parties.) 

However, the email attached to the motion—a September 14, 2015 email from a 

 

6 See generally Mangum v. Hargett, 67 F.3d 80, 83 (5th Cir. 1995) (“[Section] 

455(b)(3) does not mandate recusal unless the former government attorney has actually 

participated in some fashion in the proceedings. Mangum does not allege specific 

participation by Judge Wingate in his guilty plea proceedings, but rather, he asserts that 

Judge Wingate was a member of the prosecution staff. Such a claim is not sufficient to 

mandate recusal.”) (footnote omitted); Kendrick v. Carlson, 995 F.2d 1440, 1444 (8th Cir.

1993) (“[T]his per se [disqualification] rule does not extend to disqualify a supervisory 

AUSA who had no involvement with a case brought in his district.”); United States v. Di 

Pasquale, 864 F.2d 271, 279 (3d Cir. 1988) (same).
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congressional staffer to the USAO’s public affairs officer (but not the undersigned judge), 

with Danzik cc’d (Doc. 204-1 at 1)—does trigger some vague memories. Specifically, the 

undersigned judge now recalls that, after this email was forwarded to him, a single phone 

conversation with Danzik ensued. The undersigned judge does not, however, recall this 

conversation as involving Danzik trying to explain why he shouldn’t be charged with 

crimes (which is how the Subpoenaed Individuals characterize it in their motion). It is 

inconceivable that the target of a criminal investigation, let alone a sophisticated whitecollar target represented by Wilenchik & Bartness, would affirmatively call the USAO, 

without an immunity agreement in place, to discuss the merits of a pending investigation. 

Instead, the undersigned judge’s vague recollection is that Danzik called because he wanted 

the USAO to pursue an investigation of crimes allegedly committed by others. 

This was not a noteworthy conversation. Private individuals routinely call the 

USAO in the hope of initiating an investigation of others. The usual practice (at least in 

Arizona during the undersigned judge’s tenure) was to route such calls to the 

Chief/Executive AUSA. As a result, the undersigned judge fielded dozens of similar 

inquiries during his four years in that position. Almost invariably, the response was the 

same—the caller should contact the FBI or some other law enforcement agency because 

the USAO is a prosecutor’s office, not an investigatory office. This was, as far as the 

undersigned judge can recall, the sum and substance of the 2015 conversation with 

Danzik—a single brief (and unmemorable) phone call, unconnected to Wyo Tech, that 

resulted in nothing. Such a phone call surely cannot require recusal under 28 U.S.C. 

§ 455(b)(3) in an unrelated civil lawsuit four years later.

Finally, although the only statutory provision cited in the Subpoenaed Individuals’ 

motion is § 455(b)(3), the motion also asserts that recusal is warranted because “what 

matters is not the reality of bias or prejudice but its appearance.” (Doc. 204 at 5.) This 

appears to be a request for recusal under 28 U.S.C. § 455(a), which provides that a judge 

“shall disqualify himself in any proceeding in which his impartiality might reasonably be 

questioned.” Id. 
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The test under § 455(a) is whether “a reasonable person with knowledge of all the 

facts” would conclude the judge’s impartiality might reasonably be questioned. United 

States v. Mikhel, 889 F.3d 1003, 1027 (9th Cir. 2018) (quotation omitted). “The reasonable 

person is not someone who is hypersensitive or unduly suspicious, but rather is a wellinformed, thoughtful observer.” Id. (quotation omitted). “The standard must not be so 

broadly construed that it becomes, in effect, presumptive, so that recusal is mandated upon 

the merest unsubstantiated suggestion of personal bias or prejudice.” Id. (quotation 

omitted). 

Here, the reasons identified in the Subpoenaed Individuals’ motion—(1) issuing 

discovery rulings with which they apparently disagree, (2) being friends with a lawyer who

has a brother who has a law partner who is serving as local counsel in this case, (3) working 

for the USAO at the same time that a different AUSA, separated by three levels of 

supervisors, was pursuing an unrelated criminal investigation involving a non-party, and 

(4) having a phone call four years ago with a non-party about an unrelated matter—would 

not cause a reasonable person to question the undersigned judge’s impartiality. See also 

United States v. Carey, 929 F.3d 1092, 1104-06 (9th Cir. 2019) (recusal not required under 

§ 455(a), where judge relied on extrajudicial materials in reaching decision, because 

“courts have regularly held that outside knowledge does not on its own prejudice judicial 

proceedings”); Champlin, 388 F. Supp. 2d at 1183 (recusal not required under § 455(a) 

when proffered reasons all relate to prior government service and are insufficient to require 

recusal under § 455(b)(3)).

Accordingly, IT IS ORDERED that:

(1) The Subpoenaed Individuals’ motion for recusal (Doc. 204) is denied; and

(2) The Judgment Creditors’ response to the Subpoenaed Individuals’ motion to 

quash (Doc. 204-2) is due within 14 days of today’s date.

Dated this 27th day of August, 2019.
Exhibit A