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January 16, 1998

CELIA GUTIERREZ, ABNER McKENZIE, DAVID CHENOT, and PEGGY BAKER, On Behalf of Themselves and All Others Similarly Situated, Plaintiffs,
CHARLES J. GIVENS, Jr., et al., Defendants.

The opinion of the court was delivered by: BREWSTER


 I. Case Type and Jurisdiction

 This class action is brought on behalf of all class-member judgment creditors in an earlier state court action. The class seeks to pursue their remedies against defendants under the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. §§ 1961-1968 and California statutory and common law. The Court has subject matter jurisdiction over RICO suits pursuant to 18 U.S.C. § 1964(c), and over the state law claims through supplemental jurisdiction under 28 U.S.C. § 1367.

 II. Background

 Plaintiffs were members of a state class action suit who obtained judgment against Defendant Charles J. Givens for false statements and misinformation regarding membership in the Charles J. Givens Organization, Inc. Of the twenty defendants, ten are people and ten are corporate entities or trusts. The individual defendants are Givens and four of his family members, four of his attorneys, and his accountant. The organizational defendants include Colonial Bank f/k/a Southern Bank of Central Florida and nine alleged holding companies or trusts controlled by Defendants.

 The class includes all current or former California residents who purchased memberships in the Charles J. Givens Organization, Inc. between May 5, 1986 and March 17, 1993, and who did not opt out of the class action in California Superior Court entitled Cella Gutierrez, et al. v. Charles J. Givens Organization, Inc., et al., Case No. 667169 (Super. Ct., San Diego Cty.) The class in that case claimed that Givens defrauded them through negligent misrepresentations and violated California's Consumer Legal Remedies Act and other statutory and common law provisions. Members paid significant fees to the Givens Organization for membership, consulting, and seminars. Plaintiffs allege that, by the end of 1994, the Organization had sold over 600,000 memberships nationwide and enjoyed annual revenues of "several hundred million dollars" from its seminars and other products.

 On July 22, 1996, the Superior Court, acting upon the jury's verdict, entered a judgment against Givens personally in the amount of $ 9,438,027 in compensatory damages, $ 4,719,013.50 in punitive damages, and $ 2,889,551.56 in costs and attorneys' fees, for a total liability of $ 17,046,592.06. Givens now claims that he has no assets from which to pay the judgment. Plaintiffs allege that all twenty defendants participated in a broad conspiracy to protect Givens' alleged millions of dollars of assets from the judgment and other legitimate debts.

 This action was filed on June 26, 1997. Four groups of defendants filed motions to dismiss. In an Order dated November 5, 1997, the Court denied all but one motion (see footnote), finding that Plaintiffs had stated a claim upon which relief could be granted. *fn1" The Court also certified the class action pursuant to Federal Rule of Civil Procedure 23. Defendants Reiserer and Chatzky have moved the Court to reconsider its decisions pursuant to Local Rule 7.1(1). None of the other defendants have joined this motion or moved to reconsider.

 III. Analysis

 A. Motions to Reconsider

 Defendants Reiserer and Chatzky have not made this motion pursuant to Rules 59 or 60 of the Federal Rules of Civil Procedure. Rule 59 addresses procedures for requesting new trials and amendments to judgments that must be made within 10 days. Rule 60(b) provides only for relief from a "final" judgment, which does not exist in this case. Instead, this motion is based on Local Rule 7.1(i) which provides that:


1. Whenever any motion or any application or petition for any order or other relief has been made to any judge and has been refused in whole or in part. . . and a subsequent motion or application or petition is made for the same relief in whole or in part upon the same or any alleged different state of facts, it shall be the continuing duty of each party and attorney seeking such relief to present to the judge to whom any subsequent application is made a . . . certified statement of an attorney setting forth the material facts and circumstances surrounding each prior application, including inter alia: (1) when and to what judge the application was made, (2) what ruling or decision or order was made thereon, and (3) what new or different facts and circumstances are claimed to exist which did not exist, or were not shown, upon such prior application.


2. Except as may be allowed under Rules 59 and 60 of the Federal Rules of Civil Procedure, no motion or application for reconsideration shall be filed more than 30 days after the entry of the ruling, order or judgment sought to be reconsidered.

 This motion to reconsider was filed on December 8, 1997, thirty-three days after the Court's November 5, 1997 order was filed. Therefore, pursuant to Local Rule 7.1(i)(2), this motion is untimely and could be rejected solely on that ground.

 Furthermore, Reiserer and Chatzky have failed to indicate any "new or different facts and circumstances" upon which this motion for reconsideration is grounded. As discussed below, their motion regarding Plaintiffs' standing in view of the Givens organization bankruptcy relies on exactly the same arguments and supporting documentation that they submitted in their motion to dismiss, while their motion to reconsider class certification, also discussed below, is premised only on their "surprise" at the Court's action.

 Therefore, Defendants Reiserer and Chatzky's motion to reconsider fails to satisfy the requirements of Local Rule 7.1(i). However, the Court will proceed to discuss briefly the merits of their objections.

 B. The Merits

 1. The Givens Organization Bankruptcy

 In their motion to dismiss, Reiserer and Chatzky argued that Plaintiffs lack standing to bring this suit because of the pending bankruptcy proceedings of the Charles J. Givens Organization, Inc., now known as International Administrative Services, Inc. The Corporation filed for bankruptcy on June 20, 1996, in the Middle District of Florida.

 The Court rejected this argument, finding that Plaintiffs are not trying to collect money from the bankruptcy estate, and that therefore, the bankruptcy judge's order retaining jurisdiction "all questions concerning the assets or property of [International Administrative Services, Inc.], does not bar this action.

 In the instant motion, Reiserer and Chatzky have reiterated their original argument to the Court. Their motion alleges that "Plaintiffs [are] attempting to avoid proceeding in the Bankruptcy Court by not naming the Organization as a defendant." Apparently, Reiserer and Chatzky believe that the Court's original ruling is premised on a technicality. Defendants should realize that had Plaintiffs named the organization as a defendant, only the organization would have been considered for dismissal pursuant to the bankruptcy. This suit seeks a legal remedy from the personal assets of each individual defendant, including Reiserer and Chatzky, for their alleged misdeeds in hiding Givens' assets from legitimate judgment creditors. If legal damages are awarded in this case, the funds would not be presented as satisfaction of the judgment against the Givens' Organization. The damages would be an independent means of redress against individuals and entities that allegedly committed serious, and perhaps criminal, wrongs against Plaintiffs.

 Therefore, for the purposes of this action, the bankruptcy proceedings are irrelevant to Reiserer and Chatzky.

 2. Class Certification

 In its November 5, 1997 order, the Court certified the proposed class action on the basis of the pleadings. Rule 23(c)(1) states that "as soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained." FED. R. CIV. P. 23(c)(1). Although Plaintiffs' Complaint satisfactorily sets forth compliance with each of Rule 23's requirements, and although the history and facts of this case are highly suggestive that it would proceed as a class action, Reiserer and Chatzky claim that they were "completely surprised" by the Court's certification, and on this ground move the Court to reconsider its decision.

 Rule 23 does not require Plaintiffs to move for class certification. A Court is permitted, but hardly required, to invite additional briefing regarding class certification when it is unable to make a "reasonable judgment" on the basis of the pleadings. See Blackie v. Barrack, 524 F.2d 891, 901 n. 17 (9th Cir. 1975). If it later becomes clear that the class does not possess the required characteristics under Rule 23, the order "may be altered or amended before the decision on the merits." FED. R. CIV. P. 23(c)(1).

 IV. Conclusion

 For the reasons set forth above, Defendants Reiserer and Chatzky's motion to reconsider is DENIED.


 DATED: 1/16/98

 Rudi M. Brewster


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