IN RE: Natural Resources Fund, Inc., Securities Litigation

1:73-F-00149Jpml6 mag 2015

Testo completo

Case MDL No. 149 Document 2 Filed 05/06/15 Page 1 of 5
BEFORE THE JUDICIAL PANEL Junie oA
TRON... LITIGATION
IN RE NATURAL RESOURCES FUND, INC. ) KOR 19 181k
SECURITIES LITIGATION ) DOCKET NO. 149
OPINION AND ORDER
BEFORE ALFRED P. MURRAH, CHAIRMAN, AND JOHN MINOR WISDOM,
EDWARD WEINFELD, EDWIN A. ROBSON, WILLIAM H. BECKER,
JOSEPH S. LORD, III*, AND STANLEY A. WEIGEL, JUDGES OF THE PANEL
PER CURIAM
This litigation concerns the sale of preorganization
limited partnership subscriptions in oil and gas ventures in
which Natural Resources Fund, Inc. acted as general partner.
Plaintiffs, purchasers of limited partnership subscriptions,
allege that Natural Resources Fund, its affiliates and former
directors violated federal securities laws in connection with
the sales of the partnership interests. In a somewhat related
action Ho filed in the Eastern District of California, plaintiffs
alleged breach of an oral contract to redeem partnership interests
but do not allege securities laws violations. Several of the
corporate defendants move the Panel for an order transferring
the actions, including the California contract action, to the
District of Kansas for coordinated or consolidated pretrial
proceedings pursuant to 28 U.S.C. §1407. The accounting firm
of Elmer Fox and Co., a plaintiff who filed his individual action
in the Southern District of New York, and plaintiffs in the
California contract action oppose transfer. We find that all
/ Gene E. Bigham, et al. v. Natural Resources Fund, Inc.,
et al., E.D. California, Civil Action No. S-2605
. i Case MDL No. 149 Document 2 Filed 05/06/15 Page 2 of 5
i
actions, except the California contract action, involve common
questions of fact and that their transfer to the District of
Kansas for coordinated or consolidated pretrial proceedings
will best serve the convenience of the parties and witnesses
and promote the just and efficient conduct of the litigation.
Plaintiffs in the California contract action oppose
transfer on the ground that their action does not contain
allegations of violations of the securities laws. We agree
with plaintiffs that discovery in their action only concerns
proof of the existence of an oral contract and the alleged
breach thereof, and will not be relevant to the overall subscrip-
tion selling operations and alleged securities laws violations
that are the focus of the other six actions. Thus, isolated
both factually and legally, no purpose would be served by trans-
fer of this action under Section 1407. The accounting firm
opposing transfer argues that the actions to which it is a party
involve non-common issues such as the professional liability
of certified public accountants. The individual New York plain-
tiff stresses that transfer of his action will cause needless
complication and delay. These arguments are not persuasive.
All the securities actions contain substantially similar com-
plaints and will involve common discovery of the same subscrip-
tion selling techniques. Any non-common issues can be expedi-
tiously resolved by the transferee judge without sacrificing
the benefits of coordinated or consolidated pretrial proceedings.
Case MDL No. 149 Document 2 Filed 05/06/15 Page 3 of 5
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In addition, several of these actions contain Rule 23
class allegations encompassing all limited partners in all of
the partnerships, and the potential for conflicting class deter-
minations by the transferor courts is readily apparent. This
presents another highly persuasive if not compelling reason
for transfer of all actions to a single judge. In re Equity
Funding Corporation of America Securities Litigation, _
F. Supp. __ (J.P.M.L., filed February 1, 1974).
The District of Kansas is the most appropriate trans-
feree forum because it is the center of gravity of this litiga-
tion. Bankruptcy proceedings are pending in that district and
discovery will focus on documents and witnesses located in
Wichita, the home of Natural Resources Fund, Inc. Indeed, one
of the actions has been transferred to the District of Kansas
under Section 1404 (a) %/ na the Panel has often cited such
transfers as persuasive reasons for choosing the same district
as the transferee forum for Section 1407 proceedings. See, e.9.,
In re Master Key Antitrust Litigation, 320 F. Supp. 1404, 1406
(F.P.M.L. 1971).
IT IS THEREFORE ORDERED that all actions listed on
the attached Schedule A pending in districts other than the
District of Kansas be, and the same hereby are, transferred to
the District of Kansas and, with the consent of that court,
assigned to the Honorable Wesley E. Brown for coordinated or
27" The action entitled Roy B. Johnson, et al. v. Natural
Resources Fund, Inc., et al.,was transterred	by the Honorable
James A. Coolahan, of the District of New Jersey, to the
District of Kansas pursuant to 28 U.S.C. §1404(a).
Case MDL No. 149 Document 2 Filed 05/06/15 Page 4 of 5
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consolidated pretrial proceedings pursuant to 28 U.S.C. §1407.
IT IS FURTHER ORDERED that transfer of the action
entitled Gene FE. Bigham, et al.’ wv.’ Natural Resources Fund, Inc.,
et al., E.D. California, Civil Action No. S-2605, be, and the
same hereby is, DENIED.
CL. Case MDL No. 149 Document 2 Filed 05/06/15 Page 5 of 5
SCHEDULE A ‘DOCKET NO. 149
CENTRAL DISTRICT OF CALIFORNIA
Robert A. Krieger, et al. v. Tilco, Inc., Civil Action
Robert A. Krieger, et al. v. Hinton Jones Civil Action
" & Co., Inc., et al. v. Tilco, Inc., et al. No. 72-1734-F
DISTRICT OF MASSACHUSETTS
Sanford Freeman, et al. v. Natural Civil Action
Resources Fund, Inc., et al. No. 72-2473-T
DISTRICT OF CONNECTICUT
Lester Katz, et al. v. Tilco, Inc., et al. Civil Action
No. 15060
SOUTHERN DISTRICT OF NEW YORK
Adrian Skydell, etc. v. Natural Resources Civil Action
Fund, Inc., et al. . No. 71 Civ. 3725
DISTRICT OF KANSAS
Roy B. Johnson, et al. v. Natural Resources Civil Action
Fund, Inc., et al. No. W=5307

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