United States District Court, E.D. Michigan, Southern Division
OPINION AND ORDER DENYING DEFENDANT'S MOTION TO
STAY [ECF NO. 48] AND DENYING, AS MOOT, DEFENDANT'S
EMERGENCY MOTION FOR INTERIM STAY OF DISCOVERY PENDING
RESOLUTION OF MOTION TO STAY [ECF NO. 49]
V. PARKER U.S. DISTRICT JUDGE.
initiated this § 1983 lawsuit on July 24, 2017. (ECF No.
1.) This lawsuit arises from Defendant City of Detroit
suspending Plaintiff Nationwide Recovery, Inc.'s towing
permit without prior notice and a pre-deprivation hearing.
(Id.) Defendant seeks a stay of the case due to a
pending criminal investigation centered on Plaintiff's
alleged auto theft and tax evasion, or alternatively, a
protective order staying discovery until the Court rules on
the parties' cross-motions for summary judgment and
Plaintiff's motion to amend its complaint.
before the Court is Defendant's Motion to Stay and
Emergency Motion for Interim Stay of Discovery Pending
Resolution of Motion to Stay, filed November 17, 2017 and
November 22, 2017. (ECF Nos. 48, 49.) Plaintiff filed a
response on November 28, 2017. (ECF No. 51.) For the reasons
stated below, the Court denies Defendant's motions.
Factual and Procedural Background
is a towing service and operates a motor vehicle storage yard
in Detroit, MI. (ECF No. 13.) Beginning in 2010, Defendant
began issuing towing permits to qualified towing companies to
conduct police authorized tows. (ECF No. 13 at Pg ID 152.)
Plaintiff was a holder of a towing permit, Detroit Police
Department Tow Permit 16-047, which was set to expire on May
31, 2021. (Id. at Pg ID 153-54.) On July 19, 2017,
without notice or hearing, officers from the Detroit Police
Department took possession of Plaintiff's towing permit.
(ECF No. 13 at Pg ID 155.)
response, on July 24, 2017, Plaintiff initiated this lawsuit.
(ECF No. 1.) On August 14, 2017, Defendant filed a
Counterclaim, as well as a Third-Party Complaint against
Jerry Parker, Hussein M. Hussein, Louay M. Hussein, officers
and owners of Nationwide Recovery. (ECF No. 5.) In its
Counterclaim and Third-Party Complaint, Defendant alleged
Plaintiff conspired to commit fraud and auto theft, among
September 5, 2017, Plaintiff filed an Amended Complaint,
adding a claim for First Amendment retaliation. (ECF No. 13.)
After twice amending its Counterclaim and Third-Party
Complaint, on October 16, 2017, Defendant voluntarily
withdrew its counterclaims and Third-Party Complaint. (ECF
Nos. 14, 18, & 27.)
seeks a stay on the case pending its criminal investigation
against Plaintiff. Alternatively, Defendant seeks a
protective order staying discovery until the resolution of
all pending motions. (Id.) Plaintiff filed a motion
for leave to file a second amended complaint on October 23,
2017. (ECF No. 32.) Both parties filed cross-motions for
partial summary judgment. (ECF Nos. 24 & 41.)
Applicable Law & Analysis
courts have ‘broad discretion in determining whether to
stay a civil action while a criminal action is pending or
impending.'” FTC v. E.M.A. Nationwide,
Inc., 767 F.3d 611, 627 (6th Cir. 2014). District courts
consider the following factors when determining whether a
case should be stayed:
1) the extent to which the issues in the criminal case
overlap with those presented in the civil case; 2) the status
of the case, including whether the defendants have been
indicted; 3) the private interests of the plaintiffs in
proceeding expeditiously weighed against the prejudice to
plaintiffs caused by the delay; 4) the private interests of
and burden on the defendants; 5) the interests of the courts;
and 6) the public interest.
Id. The courts also consider the potential
implication of Fifth Amendment rights. Id.
“Ultimately, the burden is on the party seeking the
stay to show there is ‘pressing need for delay, and
that neither the other party nor the public will suffer harm
from entry of the order.'” Auramet Int'l,
LLC v. C.R. Metals, No. 16-cv- 11177, 2016 U.S. Dist.
LEXIS 100607, *9 (E.D. Mich. Aug. 2, 2016). The Court now
turns to the balancing of the factors to determine if the
case should be stayed.
Defendant alleges a criminal investigation is underway, there
currently is no pending criminal case or indictment.
Therefore, the Court is at a disadvantage to accurately
assess whether the issues involved in the criminal case
overlap with the civil case. However, Defendant alleges that
much of the investigation surrounds the allegations in its
withdrawn Counterclaim alleging auto theft and tax evasion.
As it relates to the overlap of criminal and civil cases, the
Sixth Circuit stated: “[e]ven if they were to overlap,
because there is not yet a criminal case, it cannot be said
that this factor weighs in [Defendant's] favor.”
E.M.A. Nationwide, Inc., 767 F.3d at 628.
second factor weighs in favor of Plaintiff. Generally, if
there has been no indictment, a case will not be stayed.
FTC, 767 F.3d at 628. To the contrary, if a party
has been indicted for the same conduct as in the civil case,
a stay on a civil case is appropriate. Id.
(“[T]he likelihood that a defendant may make
incriminating statements is greatest after an indictment has
issued, and . . . the prejudice to the plaintiffs in the
civil case is reduced since the criminal case will likely be
quickly resolved due to Speedy Trial Act
considerations.”) (citing Trs. of Plumbers &
Pipefitters Nat. Pension Fund v. Transworld Mechanical,
886 F.Supp. 1134, 1139 (S.D.N.Y. 1995)). As discussed above,
there has been no criminal indictment. Furthermore,
Plaintiff, who is the center of the alleged criminal
investigation, opposes the stay and has asserted that it has
no Fifth Amendment concerns. (ECF No. 51 at Pg ...