Securities and Exchange Commission v. Millan

Nature of the Provided Text

The provided document is a September 29, 2020 letter from counsel for Cecilia Millan and Margarita Cabrera to Judge Colleen McMahon. It asks the court to stay, or pause, the SEC’s civil proceeding. The supplied case metadata lists October 5, 2020 as the filing date. The text does not include a court order ruling on the request.

Background

The letter states that the SEC filed its complaint on approximately August 18, 2020. It says the SEC’s civil case and a related federal criminal case concern the same alleged activities: soliciting and raising funds from investors in AirBit Club, described in the letter as a multi-level marketing program.

According to the letter, the SEC accused Millan and Cabrera of acting as unlicensed broker-dealers in violation of Section 15(a) of the Securities Exchange Act of 1934. The United States charged Millan in the criminal case with wire-fraud conspiracy and conspiracy to commit money laundering. The letter states that Millan had been indicted and that Cabrera was not a defendant in the criminal case.

Requested Stay

Millan and Cabrera asked the court to stay the civil proceeding as to both of them until the criminal case against Millan was resolved. A stay temporarily pauses a case or part of a case.

The letter argued that the civil and criminal proceedings substantially overlap. It asserted that civil discovery could place Millan in a position where answering questions might incriminate her. The defendants also argued that continuing the civil case could force Millan either to give up her constitutional protection against self-incrimination or risk an adverse inference in the civil case.

The letter discussed six factors courts commonly consider when deciding whether to stay a civil case pending a parallel criminal proceeding: the overlap between the cases, the criminal case’s status, the parties’ interests, the court’s interests, and the public interest. It argued that all six factors favored a stay. It also contended that staying the case as to Cabrera would avoid separate discovery schedules and duplication of work.

Requested Additional Relief

The defendants also asked the court to order the parties to provide a joint status update within two weeks after the criminal case concluded.

Disposition

The provided text contains no ruling by Judge Colleen McMahon. It does not state that the stay request was granted, denied, or granted in part and denied in part. Therefore, the court’s disposition cannot be determined from this text.