Kristoffer Ryan Winters, Trustee of The Kristoffer Ryan Winters Living Trust Dated August 4, 2015 vs. Emmes

103 Kristoffer Ryan Motion to Compel Arbitration Winters, Trustee of The Kristoffer Ryan Defendants Beacon Pointe Advisors, LLC, Beacon Pointe Advisors Winters Living Trust Holdings, LLC, and David Emmes’ alternative Motion to Stay Action is Dated August 4, 2015 GRANTED; the Motion to Compel Arbitration is DENIED AS MOOT. vs. Emmes Defendants may file a motion to compel arbitration after the stay is lifted.

“It is black letter law that, when a Federal action has been filed covering

the same subject matter as is involved in a California action, the California court has the discretion but not the obligation to stay the state court action.” Caiafa Prof. Law Corp. v. State Farm Fire & Cas. Co. (1993) 15 Cal.App.4th 800, 804; accord Thomson v. Continental Ins. Co. (1967) 66 Cal.2d 738, 746 (“Granting a stay in a case where the issues in two actions are substantially identical ... is a matter addressed to the sound discretion of the trial court.”).

“‘In exercising its discretion the court should consider the importance of discouraging multiple litigation designed solely to harass an adverse party, and of avoiding unseemly conflicts with the courts of other jurisdictions. It should also consider whether the rights of the parties can best be determined by the court of the other jurisdiction because of the nature of the subject matter, the availability of witnesses, or the stage to which the proceedings in the other court have already advanced.’ [Citation.]

The California Supreme Court also has isolated another critical factor favoring a stay of the state court action in favor of the Federal action, a factor which happens to be present in this case—the Federal action is pending in California not some other state.” Caiafa, 15 Cal.App.4th at 804. Courts may also consider judicial economy and efficiency. See, e.g., Schneider v. Vennard (1986) 183 Cal.App.3d 1340, 1348 (to the extent possible, it is preferable to resolve a dispute through a pre-existing action rather than proceeding simultaneously.)

Here, the court finds a discretionary stay is warranted.

First, this action and the “Federal Action,” i.e., Winters v. Lugano Diamonds & Jewelry, Inc., et al. (C.D. Cal.) No. 8:25-cv-01202-DOC- DFM, involve the same subject matter and the same underlying facts. While plaintiff argues “this case is the only one based on the sale of securities,” the court finds this a distinction without a difference as the Federal Action, as here, is chiefly concerned with Mr. Ferder’s and Lugano Diamonds’ liability for the alleged underlying wrongful acts. Indeed, as plaintiff has alleged, the “securities” at issue are the same “fractionalized interests in diamond jewelry investments,” that are the subject of the related cases.

ROA 2 ¶ 62. In other words, the core evidence in this and the Federal Action are coextensive. Plaintiff’s argument also fails to account for the recent SEC action, which directly involves Ferder’s and/or Lugano Diamonds’ sale of securities. Securities and Exchange Commission v. Ferder, et al. (C.D. Cal.) No. 8:26-cv-02492.

A stay is appropriate where there is a strong probability that issues necessary to a determination of the action would be concluded, in whole or in part, in the other proceeding. Federal Ins. Co. v. Superior Court (1998)

60 Cal.App.4th 1370, 1373; Belnap Freight Lines, Inc. v. Petty (1975) 46 Cal.App.3d 159, 164. The court finds that to be the case here because the causes of action in this case and the Federal Action are based on the same general set of facts. To illustrate, plaintiff cites to Lugano Diamonds and Jewelry no fewer than 75 times in the complaint, alleging “Moti [Ferder] and Lugano offered and sold” the securities at issue. ROA 2 ¶¶ 61, 64, 67, 79. Indeed, as the complaint makes clear, the activities of Ferder and Lugano Diamonds underlie every cause of action upon which the complaint is based.

Second, due to the substantial overlap in issues, this action should be stayed to avoid conflicting decisions as to whether Ferder and Lugano Diamonds committed the underlying wrongful acts.

Third, the Federal Action, which was filed more than eight months prior to this action, is in the Central District of California and Judge Carter’s court is located one block from the court. Due to his familiarity with the parties, the facts, and the claims, Judge Carter is in a better position to efficiently resolve the underlying facts, and plaintiff has set forth no legitimate basis to undermine that conclusion. It would be a waste of judicial resources for two courts to determine what are likely the same factual issues and/or to resolve discovery disputes pertaining to the same information. See, e.g., OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 141 (The court appropriately exercises its discretion to discourage a multiplicity of suits, which will, at the very least, tax the resources of two courts.).

Finally, plaintiff claims no prejudice by a stay and the court sees none as either apparent or likely.

Accordingly, the action is STAYED pending the outcome of the Federal Action.

Defendants’ unopposed Request for Judicial Notice (ROA 39 Exs. 2-7) is GRANTED. Cal. Evid. Code § 452(d).

The Court sets a status conference for September 2, 2027, at 9:30AM. The parties shall submit a joint status conference statement 10 days in advance of the hearing.

Defendants to give notice