635 F.Supp.3d 1087
D. Nev.2022Background
- PlayUp, an online sports-betting company, sued and Mintas (its former U.S. CEO) asserted counterclaims against PlayUp Inc., Australian parent PlayUp Ltd., and director Daniel Simic.
- PlayUp Ltd. and Simic moved to dismiss for lack of personal jurisdiction and thereafter declined to participate in discovery, prompting Mintas to move to compel.
- The magistrate judge denied the defendants’ motion to stay discovery and granted Mintas’s motion to compel, after a "preliminary peek" finding the personal-jurisdiction challenges not sufficiently meritorious to warrant a stay (forum-selection clause and alleged Nevada-directed conduct were relevant).
- Defendants filed timely objections to the magistrate order and an emergency motion to stay the order pending district-judge review ( Rule 72(a) context ).
- The magistrate judge denied the emergency motion to stay, applying the four-factor stay test and emphasizing the heavy burden to stay magistrate non-dispositive discovery orders absent a strong showing of likelihood of success or probable irreparable harm.
- The court modified the scheduling order (extended dispositive-motion deadline) and allowed parties to request further scheduling relief by a set date.
Issues
| Issue | Plaintiff's Argument (Mintas) | Defendant's Argument (Simic / PlayUp Ltd.) | Held |
|---|---|---|---|
| Whether the magistrate’s discovery order must be stayed pending Rule 72(a) objection | Discovery should proceed; magistrate did not err in denying stay | The order should be stayed while district judge reviews the objection | Denied — filing an objection does not automatically stay a magistrate non-dispositive order; movant failed to meet stay factors |
| Standard for "preliminary peek" in personal-jurisdiction context | Magistrate properly applied preliminary-peek (more lenient) analysis | Magistrate should have applied a more stringent "convincing" standard or separately analyzed "good cause" | Denied — magistrate did not apply a stricter standard and preliminary-peek/good-cause analysis is discretionary and appropriate here |
| Whether the magistrate erred by considering evidence outside the complaint (e.g., deposition testimony) when evaluating personal jurisdiction | It's proper to consider affidavits/depositions on jurisdictional contacts | Such evidence was improperly considered | Denied — courts may consider evidence beyond the complaint when ruling on personal jurisdiction challenges |
| Whether the burden/cost of complying with discovery constitutes irreparable harm warranting a stay | The expense and "irreversible" disclosure justify a stay | Monetary/time burdens are insufficient; no probable irreparable harm shown | Denied — ordinary discovery burden and expense do not establish probable irreparable harm absent a stronger showing (e.g., privileged or trade-secret harm) |
Key Cases Cited
- Maness v. Meyers, 419 U.S. 449 (1975) (orders must be obeyed pending appeal absent an entered stay)
- Nken v. Holder, 556 U.S. 418 (2009) (four-factor stay test and courts’ authority to stay)
- Freestream Aircraft (Bermuda) Ltd. v. Aero Law Grp., 905 F.3d 597 (9th Cir. 2018) (standards for personal-jurisdiction evaluation at preliminary stages)
- Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements Ltd., 328 F.3d 1122 (9th Cir. 2003) (courts may credit affidavits and other evidence in personal-jurisdiction analysis)
- Tradebay, LLC v. eBay, Inc., 278 F.R.D. 597 (D. Nev. 2011) (preliminary-peek framework for stays of discovery)
- Jarvis v. Regan, 833 F.2d 149 (9th Cir. 1987) (discovery may be stayed where dispositive motion can be decided without discovery)
- Alaska Cargo Transp., Inc. v. Alaska R.R. Corp., 5 F.3d 378 (9th Cir. 1993) (abuse of discretion if discovery is stayed when necessary to decide dispositive motion)
- Lair v. Bullock, 697 F.3d 1200 (9th Cir. 2012) (likelihood-of-success standard for stays requires more than a mere possibility)
- Leiva-Perez v. Holder, 640 F.3d 962 (9th Cir. 2011) (irreparable-harm must be probable for stay relief)
- Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7 (2008) (standard for injunctions and caution against overly lenient irreparable-harm showing)