Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

In re Vivendi Universal

July 1, 2009

IN RE VIVENDI UNIVERSAL, S.A. SECURITIES LITIGATION


MEMORANDUM OPINION AND ORDER

The following applications by the parties have been fully briefed and are currently pending before the Court: (1) Individual Plaintiffs' Motion for Reconsideration of the Order Granting Defendant Guillaume Hannezo's Motion to Dismiss; (2) Individual Plaintiffs' Motion to Lift Stay; (3) Individual Plaintiffs' Motion for Leave to Amend Complaints; (4) plaintiff GAMCO's Motion for Leave to File an Amended Complaint and for Nine Mutual Funds to be Joined as Additional Plaintiffs; (5) defendants Messier and Vivendi's Cross-Motion to Dismiss with Prejudice WSV's Action; (6) Ernst & Young's Motion for Reconsideration of this Court's Memorandum Opinion and Order, Dated May 28, 2009; and (7) GAMCO's Motion to strike the Expert Report of John W. Peavy, III. Also pending are defendants' objections to orders issued by Magistrate Judge Pitman on (8) August 15, 2006 and (9) January 30, 2009, (10) Individual Plaintiffs' letter request to substitute Dr. Blaine Nye for Mr. Frank Torchio as their causation and damages expert, and (11) defendant's request to exclude deposition designations for certain deponents. The Court renders or reserves decision on these motions as described below. The Court will address any outstanding issues not addressed or disposed of by this Order at the conference scheduled for July 20, 2009 at 10:30 a.m.

I. Individual Plaintiffs' Motion for Reconsideration

Individual Plaintiffs move the Court to reconsider its order dismissing their claims against defendant Hannezo for failure to timely serve him a summons and complaint. Reconsideration is appropriate when there are "matters or controlling decisions which counsel believes the court has overlooked." Local Civil Rule 6.3. "A motion for reconsideration is not a motion to reargue those issues already considered when a party does not like the way the original motion was resolved." Davey v. Dolan, 496 F. Supp. 2d 387, 389 (S.D.N.Y. 2007). Here, Individual Plaintiffs argue that the Court overlooked this Circuit's controlling authority in Montalbano v. Easco Hand Tools, Inc., 766 F.2d 737, 740 (2d Cir. 1985) and USHA (India), Ltd. v. Honewell Int'l, Inc., 421 F.3d 129, 133-34 (2d Cir. 2005), that the Court overlooked language in its own January 7, 2008 Order, and that a flexible due diligence standard should apply to Individual Plaintiffs' service on defendant Hannezo.*fn1

The Court concludes that Individual Plaintiffs have failed to point to any controlling authority or facts not previously considered by the Court and that they are, in essence, rearguing the same points they previously made on the underlying motion. The Court's original opinion cited Montalbano and USHA for the proposition on which its holding rested. The fact that Individual Plaintiffs have a different interpretation of those cases is not grounds for reconsideration. The Court similarly did not overlook its own order, which is again cited and discussed in its original opinion. What Individual Plaintiffs fail to grasp is that the Court's January 7, 2008 Order was at best a reprieve from the already long-ticking clock applicable to many of their complaints. While Individual Plaintiffs seek relief under an essentially equitable doctrine of due diligence, they refuse to admit that for many of them, the Court's January 7, 2008 Order was already an equitable extension of the 120 day deadline to at least attempt service. Accordingly, the Court denies Individual Plaintiffs' motion for reconsideration and adheres to its previous holding.

II. Individual Plaintiffs' Motion to Lift Stay

Certain Individual Plaintiffs move the Court to lift the stay*fn2 automatically imposed on their newly-filed actions*fn3 against defendant Hannezo. In its March 16, 2009 Order, the Court dismissed actions by these plaintiffs against defendant Hannezo for untimely service. When plaintiffs re-filed against Hannezo, their actions were automatically stayed by the Court's January 7, 2008 Order. Plaintiffs' actions against defendants Vivendi and Messier were left untouched by the Court's March 16, 2009 Order, and those actions are still scheduled for trial beginning on September 29, 2009. In essence, plaintiffs seek the Court's leave to proceed to trial against Hannezo when they proceed against Vivendi and Messier. In the alternative, plaintiffs move the Court to lift the stay for the sole purpose of serving Hannezo. Defendant Hannezo responded to plaintiffs' motion by letter dated May 6, 2009, in which he stated that: (1) he believes plaintiffs are free to serve him without an order of the Court provided that service is effected in compliance with the Hague Convention; and (2) if he is properly served, and plaintiffs' complaints survive any dispositive motions filed, he has no objection to plaintiffs' actions against him being tried with the Class on September 29, 2009.

Upon receiving a copy of Hannezo's letter, plaintiffs allegedly served him in compliance with the Hague Convention on May 7, 2009. In light of Hannezo's position, the Court lifts the stay on plaintiffs' actions. Should Hannezo wish to move the Court to dismiss plaintiffs' claims on the ground that they are barred by the statute of limitations-an issue on which the Court expresses no opinion at this time-he must do so by July 10, 2009. Plaintiffs will have until July 17, 2009 to respond, and Hannezo until July 22, 2009 to reply. Discovery, however, is closed, and no additional discovery will be taken.

III. Individual Plaintiffs' Motion for Leave to Amend Complaints

Individual Plaintiffs move for leave to amend their complaints in accordance with the Court's March 31, 2009 Order to correct any defects in their standing to bring suit.*fn4 Many plaintiffs need not seek leave of the Court to amend their complaints, and for those that do, Rule 15(a) of the Federal Rules of Civil Procedure directs that leave should be "freely give[n]" when "justice so requires". Defendants Vivendi and Messier do not oppose Individual Plaintiffs' motion save for the motion by WSV, which is addressed below. Accordingly, the Court finds that amendment is appropriate and grants Individual Plaintiffs' motion save for the motion made by WSV. Defendant Hannezo correctly notes that the complaints in question have been dismissed as against him, and hence this portion of the Court's order does not apply to him.

IV. Plaintiff GAMCO's Motion for Leave to File an Amended Complaint and for Nine Mutual Funds to be Joined as Additional Plaintiffs

Plaintiff GAMCO moves for leave to amend its complaint in accordance with the Court's March 31, 2009 Order to correct any defects in its standing to bring suit. Nine mutual funds that relied on a subsidiary of GAMCO, Gabelli Funds, LLC, for investment advice (the "Funds"), also move to be joined in the amended complaint as plaintiffs. Defendant Vivendi opposes only joinder of the Funds, arguing that joinder would require additional discovery, which would, at this stage, delay the September 29, 2009 trial date.

The Court finds that amendment is appropriate and grants GAMCO leave to file its amended complaint, but denies the Funds' motion to join GAMCO's action. "Rule 20, unlike its counterpart, Rule 19, prescribes permissive, not necessary, joinder and specifically vests in the district court the discretionary power to make such orders as may be required to prevent delay or prejudice." Barr Rubber Prods. Co. v. Sun Rubber Co., 425 F.2d 1114, 1126-27 (2d Cir. 1970). While the Court concedes that Rule 20 should be interpreted liberally to allow joinder whenever it would promote efficiency, the Court does not believe joinder would be efficient here. Discovery is closed, and regardless of how "minimal" discovery would be for the Funds if they were allowed to join this suit on the eve of trial, it would inevitably delay the trial date and disrupt pre-trial preparations. The Funds are free to opt out of the class and file their own lawsuits without fear of any statute of limitations bar. See Eisen v. Carlisle and Jacquelin, 417 U.S. 156, 177 n.13 (1974) ("Petitioner also argues that class members will not opt out because the statute of limitations has long since run out on the claims of all class members other than petitioner. This contention is disposed of by our recent decision in American Pipe & Construction Co. v. Utah, 414 U.S. 538 (1974), which established that commencement of a class action tolls the applicable statute of limitations as to all members of the class."). Should they do so, however, their complaints will be stayed along with the other plaintiffs from whom discovery has not yet been taken.

V. Defendants' Cross-Motion to Dismiss with Prejudice WSV's Action

Defendants Vivendi and Messier oppose WSV's motion to amend its complaint to allege assignment of certain claims, and cross-move to dismiss WSV's action with prejudice for failure to prosecute. The primary basis for defendants' opposition and cross-motion is a series of representations, both to defendants and to this Court, that WSV had abandoned its action. Specifically, WSV's counsel represented in a letter to defendants dated October 24, 2008 that "[WSV] will be dismissing its action" and subsequently sent defendants a signed stipulation to dismiss its action with prejudice on February 10, 2009.*fn5 Most significantly, the brief that Individual Plaintiffs filed in response to defendants' motion for summary judgment for lack of standing states that "[p]laintiff WSV intends to voluntarily dismiss its action" and the Counterstatement of Facts accompanying that brief states more explicitly that "WSV is no longer pursuing claims for any funds." Defendants argue that they would be prejudiced if the Court permitted WSV's action to proceed because they relied on these statements and because WSV has done nothing to move its case forward for more than six months. WSV responds that it changed its mind concerning dismissal and properly awaited the Court's decision ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.