Judge: Stephen I. Goorvitch, Case: 19STCV43653, Date: 2023-11-13 Tentative Ruling

Case Number: 19STCV43653    Hearing Date: November 13, 2023    Dept: 39

JTX Group, Inc. v. Global Meat Federation, Inc.

Case No. 19STCV43653

Order Staying Case Pending Appeal

Plaintiff JTX Group, Inc. (“Plaintiff” or “JTX”) filed this action against numerous defendants.  In brief, Plaintiff alleges that it entered into a nonbinding agreement by which Plaintiff planned to purchase a 55% stake in Global Meat Federation, Inc. (“Global Meat Federation”) for $52,800,000.  (Third Amended Complaint, ¶ 74.)  Plaintiff further alleges that Plaintiff would provide $1,500,000 to Global Meat Federation as working capital while the parties completed the proposed transaction. (Third Amended Complaint, ¶¶ 77-78.)  Plaintiff alleges that he terminated the proposed purchase, and requested the return of the $1,500,000.  (Third Amended Complaint, ¶ 86.)  Plaintiff alleges that Global Meat Federation refused to return the $1,500,000, and distributed it between Defendant, Jamal Dawood (“Dawood”), and related entities.  (Third Amended Complaint, ¶ 91.)  One of those entities was United Properties, which allegedly was controlled by Dawood.  (Third Amended Complaint, ¶¶ 14-15, 179-183.)  The Court granted United Properties’ motion for summary judgment, and Plaintiff has appealed that decision.  The Court may have erred in granting that motion, based upon which the Court noticed its own motion for reconsideration.  (See Court’s Minute Order, dated February 22, 2023.)  However, the Court lacked jurisdiction to revisit this decision.   

On September 11, 2023, the Court issued an Order to Show Cause why the Court should not stay this case pending the appeal of the Court’s decision to grant United Properties’ motion for summary judgment.  The Court issued the Order to Show Cause “based upon its inherent authority” and provided notice that “a stay may be appropriate based upon judicial economy, i.e., to avoid having two separate trials on the same issues in the event of a reversal.”  (Court’s Minute Order, dated September 11, 2023.)  The Court set a hearing and afforded the parties an opportunity to file written responses, which the Court has reviewed and considered.

The Court stays this case pending appeal because there is a reasonable probability that the Court’s grant of summary judgment to United Properties will be reversed.  If so, the Court would be forced to conduct two trials on largely the same facts, since Plaintiff’s theory is that United Properties (like other defendants) received converted funds.  Plaintiff would be forced to prove the underlying fraud and disposition of funds in two different cases.  Moreover, it is unlikely the case would proceed to trial on the current trial date anyway because the Court anticipates that it will be in a bench trial on a case starting January 8, 2024. 

Based upon the foregoing, the Court orders as follows:

1.         This case is stayed for all purposes pending the remittitur in the appeal of the Court’s decision to grant summary judgment to United Properties.

2.         The Court advances and vacates all dates.

3.         The Court orders Plaintiff’s counsel to file a status report concerning the appeal on or before November 22, 2024.

4.         The Court issues an Order to Show Cause why the stay should be lifted and, in the alternative, a trial setting conference, for December 3, 2024, at 8:30 a.m. 

5.         Plaintiff’s counsel shall provide notice and file proof of such with the Court.