Abdo v. Fitzsimmons
- Thomas Hixson
- 3:17-cv-00851
- U.S. District Court · Northern District of California
- 5
In Abdo v. Fitzsimmons, Judge Hixson issued a pretrial order resolving evidence motions and setting each side 40 trial hours.
The order affected the plaintiffs in Abdo v. Fitzsimmons and Rising Tide I, LLC v. Fitzsimmons, the defendants, and the evidence and arguments they could present at trial.
What happened
In Abdo v. Fitzsimmons and the related Rising Tide I, LLC v. Fitzsimmons case, the court ruled on the parties’ requests about what evidence and arguments could be presented at trial. The order addressed evidence about investments, investors, prior lawsuits, reports, alleged misrepresentations, and corporate duties.
The court granted, denied, or found moot several motions, sometimes only in part. It barred some evidence, limited how defendants could describe Rising Tide’s investors, allowed certain reports for limited purposes, excluded two withdrawn experts but allowed Eric Talley to testify in rebuttal, and denied several requests to exclude evidence or arguments. The court also ordered the parties not to make jury arguments inconsistent with its interpretation of a California corporation statute and denied the motion about fiduciary-duty evidence without prejudice.
Judge Thomas S. Hixson set the trial at 40 hours for each side, including opening and closing arguments. The order was dated January 6, 2022.
The detailed version
- Abdo v. Fitzsimmons · No. 3:17-cv-00851
- Thomas Hixson
- Jan. 6, 2022
Nature of the order
This was a pretrial order deciding motions in limine—requests to limit evidence or arguments at trial—in two related cases. The order did not decide the underlying securities claims.
Plaintiffs’ motions
- The request concerning opinion testimony about whether plaintiffs performed adequate diligence before investing was moot because defendants said they did not plan to offer that testimony. - The request concerning investment losses unrelated to Delivery Agent was granted. The court found that the evidence’s limited value was substantially outweighed by the risks of unfair prejudice, confusing the issues, and wasting time under Federal Rule of Evidence
- - The request concerning the investors’ personal wealth was denied as to their financial status when they made the investments. The court found that financial status could help show their level of sophistication, which was relevant to whether reliance on statements or omissions was justified and whether those statements or omissions were important. - The request concerning defendants’ ability or inability to pay a judgment was moot because defendants said they would not offer that evidence or argument. - The request concerning descriptions of Rising Tide’s investors as “Russian oligarchs” or similar terms was granted in part. Defendants could not call the investors oligarchs, friends of Putin, Russians, or use similar disparaging terms, but they could introduce evidence about the people responsible for Rising Tide’s decision to invest in Delivery Agent, what those people were told, and related matters. - The request concerning prior securities lawsuits involving Mr. Abdo, Mr. Levan, or their companies was granted under Rule
- - The request concerning Miller’s communications with Delivery Agent or consultations with Stearns Weaver was granted under Rule
- - The request to admit the internal investigation report and the Bergeson Report was granted in part. The court admitted the reports for non-hearsay purposes, such as showing notice and knowledge.
Defendants’ motion concerning expert testimony
Plaintiffs could not call defendants’ withdrawn expert witnesses Dennis Chookaszian or Marc Zenner as trial witnesses because doing so would create a danger of unfair prejudice to defendants. Plaintiffs could still call Eric Talley as a witness in their rebuttal case.
Defendants’ other motions
- The request to exclude testimony, evidence, or argument that outside directors or James Peters made false or misleading statements or failed to disclose important information was denied. The court found the request broad and vague, and concluded that the evidence was relevant to plaintiffs’ scheme claims and to whether defendants acted with the required state of mind. The court also found exclusion unwarranted under Rule 403. - The request concerning additional dates when the same “No Investigations” representation was disseminated was denied. The court interpreted the complaint as identifying specific dates to satisfy detailed pleading requirements while also alleging a pattern of the same representation in Series F preferred-stock offering documents. - As to Rising Tide’s statements 1, 2, and 3 by Fitzsimmons in the JPCS, the request was denied for statements 1 and 2. Plaintiffs could not argue that statement 3 was a basis for liability, although the court did not exclude statement 3 itself from evidence. - The request concerning Rising Tide’s statement 4 by Fitzsimmons in the JPCS was denied because the court found the statement fairly implied by the complaint’s allegations. - The request concerning consequential damages was denied as an improper attempt to reconsider the summary-judgment order. - The request concerning state-law claims against Fitzsimmons was denied as moot because the parties agreed plaintiffs had no state-law claims against him. - The portion concerning Abdo Statement 3(a), an unlisted Abdo statement, and part of Rising Tide’s Statement 3 is incomplete in the provided opinion text. The visible text says that plaintiffs could not use the identified statements as a basis for liability but that the statements themselves were not excluded from evidence; the full disposition cannot be determined from the supplied text. - The request concerning Abdo Statements 1 and 4 in the JPCS was denied. The court explained that an earlier order had found no adequate allegation of Delivery Agent’s required state of mind for those statements, but had not found the same deficiency as to Fitzsimmons. - Regarding the interpretation of California Corporations Code section 25504, the court ordered the parties not to make legal arguments to the jury inconsistent with the interpretation reflected in its earlier summary-judgment ruling concerning defendant Peter Lai. - The request concerning evidence or argument about defendants’ fiduciary duties was denied without prejudice. The court found that corporate duties could not be categorically excluded because extreme departures from normal corporate governance could be evidence of the required state of mind in a securities-fraud case.
Trial schedule
The court found the parties’ proposed trial length excessive and gave each side 40 hours, including opening and closing arguments. Judge Thomas S. Hixson signed the order on January 6, 2022.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.