IN RE: Industrial Wine Contracts Securities Litigation

| Case MDINNG: IME8USDBLAITONNE CBN OBIH AISURBGRLMA gpg ~
’ : . Cite ns 386 F.Supp. 000 1107 1) . } EE To
. transferee cones suggestion, the papers Furthermore, the motions in the Hm- a °
Tl filed and the heaving held, we order this phreps action currently pending before :
LT action remanded to the Eastern District the transferee _courtesire of a nature :
of Michigan for further proceedings. unique to that addion and their resolu- .
There have <seen—estrnsive pretrial tion does not requ frre any particular ex- - oT
and trial proceedings in this litigation perlise thal the frfgnsferee jude might,
. before Judge Wein Han. And alt of the have gained from s Iervisinge this litiga-
aebions comprising His Hiigation, except tion. Accordingly these motinns can i	thee Hampliyreys act} wm, have now been Just as easily he mm faented te the trans. oo
Cay cither terminated if the transferee dis- feraveomt for decisgon.
j : ‘ric or remanded fo the appropriate It is therefore ordpred that the action FE
Tencferor court. Npvertheless, defend- (titted George HH. §lurophieeys, ole. v.
p : ant Tann opposes femand of this res prooan pang d/b/ Tann Co. cl al, :
Cron ning action on tie ground that pre- (F.0D.Michigan, CA ENo. 22420). SD.
frinl proceedings ju gat action have not Ohio. Civil Action NE 2824MILF), be, oo
vel heen completed. 8 Defendant asserts and the same he THT % anded to the
) that {i how pretria 5 motions currently - Eastern District of Michigan, EE
: pending before the Jansferee court and :
that these mobions sgould be decided by. : :
the transferee court. §
The governing sta it te states that cach w . .
| action {ransferred bygthe Panel “shall he ¢ mmmcemonded hy the | Hanel al or before '
| the conclusion of sufgh [coordinated or :
consolidated] pretriafiproceedings to the ’ o-
district from which gt was transferred Co }vinden AL shall have Been previously ter- i
minnfed”. 28 U.S.C ES 1407(2). Since In re INDUSTRIAL. Wine CONTRACTS :i . } AE - SECURITIES LITIGATION.
! . the Ihmphreys actiofl is the only action )
Loo y renutining in this Btigation, we find No. 192. Co
CC that ne propose wong be served by de- Judicial Panel on Muitidistriet Litigation.
: faving remand of #his action to the Ton. 8 1075. ]
Foastern District of gchigan. STO EE ~
Es His not econtempl ited that a Section ©
: tang transferee judge will necessarily ~ } }
| complele all pretrialgproceedings in all Motion was filed for fransfer of ac. J	actions tranglerved ghd assigned to him fon brought in Western District of Mis- -
| Le the Panel, bat vader that the trans. Souri for alleged violation of sceurilies
feree fndge in bis digeretion will conduct laws, The Judicial Panel on Multidis-
: the common pretrig proceedings with trict Litigation held thal where all there
vipeel to the varigs actions and any defendants were also defendants in one |
additional pretrial ihroceedings as he or more actions brought in Eastern Dis
demns alberwise apgopriate. Thos, in rick of Vivginia and were faced with
coovidiming remand fof (his action, the substantially similioe eharess in both the
Poneto montly infifnced by the trans- Missonvi amd Virvinia actions, ol ace :
Cae judge's sugsesfion hat remand of tons shared common questions of fact oo
ihe action is approfriate. Cf. In re and Eastern Dislriet of Virginia was fo.
Pena Central CommEreinl Paper Litigae cal poinl of the Litigation, action wont
Gon, whe Supp. 884 (Jud. PanMult, be trawelerred to Eastern District of
Tit 10730 His susgestion is obviously Virginia for coordinated or consolidated : ;
: an indication {hat bf perceives his role pretrial proceedings.
ander Section (207 To eee ended. Order accordingly. Coi
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BS EE Case MDL No. 188 Document 2 Filed 05/01/15 Page 2 of 4 oo Sl
SRI F341 ’ A686 FEDERAL SULPLEMTUNT LE
~ Lo Slnopis $2277.92 ation and Development, Tne, Canad Core Co
C2 Poteotial bankruptey of one defend- poration, James 1. Phillipe and five olh-4 ant way iyvrelevant with respect to ap- er individuals. The SEC alleges thot all. oo
: propriatencas of transfer of action to defendants violufed the securities ropris- .
! sacther district {or coordinated or con- tration provisions of the frdecs] secuvie :
sehdated preleial proceedings, 28 U.S. ties Inwy in connechion with fhe sale of
SRL PE RA oo investment contracts, promissory noles : EE
cy SFrds CoE and limited partnerships purportedly :
- ) hers all three defendants in action concernitg the mavkeline of faropuan .
_ Byetend in Western District of Missouri wite. The SEC further altepen thal de. LL
. {or allewad violations of federal securi- (evdants Johnson and Rides Asseciates er
: Lior Tae weve alno defendants in one or SHEaged in a muliimillion dollar Pond
sie of five similar actions pending in scheme or sham whereby wine contract :
Foslorn THalriet of Virginia and were Obligations, which included the return fo
fared with sthstantially similar charges investors of principal fuvested and prof-
in both {he Missouri and Virginia ac- its ranging from 20 to 100 percent, were ) Coo
ions, all actions shared common ques- being paid off with the funds of snhses }
{ions of fart and focal point of litigation Huet investors. Eleven days after the
was in Unstern District of Virginia, Sof action was filed, a consent decree
; action Jwought in Western District of providing fer injunctive relief wis on- :
aici would be Lransferred to East- tered against	all of ta defendants cn
eve hstrich of Virginia for coordinated the registration provisions charges snd
: or eonreiidated pretrial proceedings. 28 against defendants Johnsen and Ridge oo
CELA S 1407, Asgociztes on the antifravd charges. Co
} In addition, the Governmenl recently . .
A Sept FIT ) filed a eriraingl indictment in the East
I Pod vrrovinee of transferee judge to oo piatriet of Virginia apains defond. .
Le = © determing whether and te what extent aan Johnson for his alleged pasticipation
{ 1. prot praccedings I transierred ac in the Penzi scheme. He gsobsoguently >- fren and actions pending in transferee pleaded guiliy Lo bo counts of Trandu- :
: Aiatrict shenld be coordinated or conseli- jor conduct and was sentenced be six
i dated, 28 LLE.CLAL§ 1407. ! years irgisonment, The criminal in -
ES vestigation conrorniog othev individunds
ele TTT + dustill ju progyess. } *
Bednve ALTPIRED PP. MURRATIL, Chair- After the EC action was fil, giv
sin and JOIN MINOR WISDOM, BD- private actions were filed, five in Uwe : .
o he ruLh, EOWIN A. LoB- Bagtern Disirict of Virginia and one in| SHY LIAR H. BECKER, JOSEL HU the Western Disbrictof Missoni, Sone
a. LORD TIE, and STANLEY A. WEI- of the parties are both plaini{fs and de- Co
CELT Judges of the Panel, fendants in these actions, For example, ’ SE
| Co some of the middlemen in the morketing :
Lo PER CURIAM. . operation are plaintiffs in supe actions
and defendants in others. Likewise,
: ’ to Heekground of the Litigation © Uwited Virginia Bavok/Nolional 3s a
in Jone of 1974 the Securities and plaintiff in one aclion and a dofeudant
fonhange Commission filed an enforee- in three others. Two of the aoliom: pure
; meni agoflow in the Bastern District of port to be class actions: The Rinzouri
Vierigin spainat Robert Dale Jobnson, action was filed an behad? of all peeeoan
iden Anaocintes & Co, John DD. Schrott, whe purchased Investment coulracls ]
Ju. Vales Cevporation, Resource Evalu- from defendaul Phillips in the name of
Ashore Judes Lovd and Weigel were noi consent of all practice, participeiod in thx dn.
vroeend at the bearing, they have, with the eision,

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Co Case MDL No. 188 ‘Document 2 Filed 05/01/15 Page 30of4 : ) A
Ee | CIN RE AINDUSTRIAL WINE CONTRACTS SECURITIES UIT. | 9i1 :! ’ Cite ns 386 1°. Supp. 000 (1974)
o " a partpership known as Inlevnational In- that defendant Phillips, one of the three -	i vestments between October 1, 1973 and defendants in the Missouri action, in- :
May 17, 1974; and one of the Virginia tends to file a petition for bankruptcy in }
| actions was filed on behalf of all persons the very, near fulurve and, consequently, RE
wite borrowed monies from any of three all pending litigation against him will he : . oo‘ : Virgin hanks for the purpose of in- stayed. (The other two defendants in N
oo vestingr in the wine contracts and who this action are movants Schrobl and N
! Hove not vot repaid the debts. The Vir- Vortex.) Secondly, plaintiffs contend
: winin court, however, has denied class that they cannot afford to pay addition- Ty
pedion stadas in the latter action. All of al travel and related expenses for (heir Co co
" inese private actions contain allegations counsel to atlend pretrial conferences .
thal track the allegations in the SEC ac- and other proceedings in the Eastern CT
i fio District of Virginia and therefore trans. ’ ) .
| With respect to the Tive Virginia ac- - fer will be tantamount to a dismissal of hEtian, the Honorable John A. MacKenzie plaintiffs’ complaint. Co
oben recently issued a memorandum opin- . . R . RE .
ion ia sehich ho consolidated before him- 1V- Transfer of the Missouri Action to . oo
: oli tie Herpes and Johnson actions; the Eastern District of Virginia . : .
cenanlide!	od separately before himself [1,2] Defendant Phillips's potential
Vey Cane! Corporalion aud United Vir- bankruptey is irrelevant in regard to the
windy ele, Nulional actions; and decid- appropriateness of transfer of. the Mis-
cl that thas erfer action should contin. souri action under Section 140%. What
cone preceed separately before the Hon- is important, however, js the fact that -erabie Athert Vo Bryan, Jr. all three defendants in the Missouri ac-
Co tion, including defendant Phillips, are	i Hoo YNelian before the Panel : .
N also defendants in one or move of the :
; feb 1 Bebrotd, Jr, and Vortex Cor- Virginia actions and are faced with sul)-
38 ) pration are common pacties to all of gptity similar charges in both the
Ne He actions in this litigation. They Missouri and Virginia jurisdictions.
wee Hue Panel pursuant to 28 U.S.C. 8 Moreover, all of the actions in this liti- }
i PAY ter an order transferring the Mis- gation share common questions of fact :
== sori petion to the Fastern District of inasmuch as cach complaint contains vir- .| Viveinin for coordinated or consolidated tually identical allegations of fraudulent : Co
| poeind preccedings with the five ae- conduct tracking those ssserted in the	“Aes ae ding there, Only the plaintiffs SEC action.
; Nee Mia 1 egrd dl 43 . - : .
no ee SSE, tr of th Mion tion
: : to the Eastern District of Virginia for :sree the Panel to show deference to . . Co .
bo . Toeciern Ale Kenzic's priov ruling concern- coordinated or cousolidated pretrial pro-| oo" Lo R wre se LC ceedings with the five actions pending .i. se consolidation of the Virginia actions. , ) ’ Lo Pa :	ore . : there will prevent duplication of discov-
. We fined thai these actions involve com- . it Tre .
. | owen questions of fact and that transfer ery and eliminate the possibility of in-ona : ; ; . consistent pretrial rulings. : .
i af ihe Mistouri action under Section een . oo
| PANT to the Ender District of Virginia I laintiffs cancern ahout the posibili-
CHL ede the convenience of the of Section 1107 procecdings cating
| polio and witnesses and promote the additional expense because of counsel's }sent aed efficient eonduet of the litiga- travel to the transferee district is un- :
Po warranted. Since the Missouri plain-
i i ; tiffs appear to share virtually identical Co.
VE Arguments of the Missouri Plain- interests with the plaintiffs in the
ifs di Oppasition to Transfer Barnes and Johnson actions in Virginia,
: Phe Missoni plaintiffs oppose trans- the judicious use of laison counsel, lead . ‘
fev of their action to Vieginia for two counsel and steering commitices could .
ver sene First they have been advised eliminate the need Tor Missouri counsel

| Case MDL No. 188 Document 2 Filed 05/01/15 Page 40f4 ER	k pe ’ 0 ING FRDERAL SUPPLEMENT : IoA : .
TN C . .
L : to travel to the transferee district. See VI. Seleclion of the Transferce Ihis-
h Manual for Complex Litigation, Part 1, trict - oT
, Sections 1.60.-1.93 (rev. ed. 1973). Clearly, the Eastern District of Vir-
In addition, movanis advise us that ginia is tho focal peint of this iligalion -
they anticipate several tag-along actions and [he mest approvriale {rousfueee foe
pn this litte ion. See RLPJLPRLL. 1, vam. Five of {he six private solions are }
wy B7O0OILT. 149, 120 (1971) as amended olrenly pending in thal disiviet apd als
CoRR VDL LE (972). Accordingly, the most all of the ecvporate and individeal Te
insiitulion of Seclion 1407 proceedings defepdeni{s an sell as the relovod docu :
‘ : ut thin time will have the salutary effect wnenis and witnesses are Jecaled thepe,
UPON 1 roe SP nP— Loge p Led . i. . , ,	: of providing a ready forum for the mont fL is therefore ordered thai, putanant
insboand expuditious judicial treatment oq 419 § 1107, the action listed on
_ of pay future ackions along with the 10 attached Sohedule A pendine io fhe .
present ones. See RPJLPML. 12, al wostern Districl of Missouri be, ad ihn
RIE : : . ; .
(EAE RL same herehy is, trossforved fy the Tigah. :
N : : : . or Yistrviet of Viraipin smd, will the .
V. Ceordination or Consolidatirn win Distvied of Virgioia rn wa Ehconzant of that court, wedged Go ihe
a EY gu $0 p Pr Lo . Lo .
nl We reeopnize that Judge Mac gra geable John A. Macbonsie Top care
Kenge bas dsaned an order €omcevning gdinated or consolidated preted 3 na orced-
; the comsclidation and assignment of the joo. ithe the aeiiogs Teed 0 Sobedale
five actions heretofore pending in the a ona ponding	in cho do ring
- Paslern District of Virginia, And we :
: omphingize that the Panel has conaistent- compe A . i
; bo hedd the view that it is the provinee of Eastern Distrind ofViednia
‘ the transferen judge to determine yoidi Ton of Al v Bide Ase Chit Action
iv whether and to what extent the pretrial sedate & Co, et ab Ho 33t-74-4
Pd ) procesdings should be coordinated or Caost Corp, ot alow United Vir Coat actionH } : : qr iga Gini Basi/Hational, et al. Ma. 371-04 A
} consalidated, Ser, eg. In re Rguily oC eo a RA	So i. .- . . . “ . United Vivainia Dank/fatianst vl Civil potion
- Frundiog Corporation of America Securi- voua, cop, oo al. Ho. 816.708
ties ilimalion, 5756 F.Supp. 1378, 1334 yenara ko Johmsen, sb alow, oho Chil Action
rd Chel Pan BLE Lik 1974). Ta this light, ert Dole dahacen, et al Hu, $27.74 A
s== wo trust thal any necessary coordinn. WoT. Barusiet ghoy Robert Do Cit Arline E :	. | . FEN Johneng el all Ho, why da-A .
ting between Judge MacKenzie® and ; = oe : :
p : ip 1 hoi Western Gistrict of Misogri	ter & geq er « * 42 rag « ar ee mdm	am )
a. duds © Hryan will be effectuated at there or bonny, el al v domes Civil Action
. ewn diseretion, L. Philtios, et al. . Ho. 74-502 A--3
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