U.S. Commodity Futures Trading Commission v. Banc de Binary, Ltd., 2:13-cv-00992

This is a CFTC civil-enforcement action against Banc de Binary and related entities and individuals; several discovery- and scheduling-related motions were pending.
Defendants (BDB Services Ltd. et al.) moved to stay discovery pending resolution of their motion for partial summary judgment arguing the instruments sold were not "options" under the Commodity Exchange Act.
Judge Du previously denied defendants’ motion to dismiss the same theory, finding the issue required consideration beyond the pleadings and raising factual questions.
The Commission opposed the stay and filed a Rule 56(d) declaration asserting it lacked facts necessary to oppose summary judgment without further discovery.
The magistrate judge applied the District of Nevada two-factor test for discovery stays and concluded defendants failed to meet their heavy burden to show discovery was unnecessary.
The Commission’s unopposed procedural motions (leave for excess pages, extension to disclose experts, sealing, and extension to reply) were granted under Local Rule 7-2(d).

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether discovery should be stayed pending defendants’ motion for partial summary judgment	Discovery should continue so CFTC can obtain facts needed to oppose summary judgment	Stay discovery because the partial summary judgment is dispositive on whether instruments are "options"	Denied: defendants failed to show discovery unnecessary; factual dispute requires discovery
Whether the pending summary-judgment motion is potentially dispositive and can be decided without discovery	CFTC: cannot oppose without discovery; issue is factual	Defendants: motion is potentially dispositive on count one and should stay discovery	Denied: court took a preliminary peek and found factual issues; two-factor test favors continuing discovery
Whether Rule 56(d) protection warrants staying discovery	CFTC invoked Rule 56(d) to obtain needed facts to oppose summary judgment	Defendants argued CFTC did not show how additional discovery would affect the summary-judgment issue	Ruling favored CFTC: stay would improperly preempt Rule 56(d) rights and possibly hide discoverable facts
Whether to grant CFTC’s unopposed motions (excess pages; extend expert disclosure; seal; extend reply)	CFTC requested procedural relief; motions unopposed	No opposition filed	Granted under Local Rule 7-2(d); specific extensions and sealing allowed

Blankenship v. Hearst Corp., 519 F.2d 418 (9th Cir. 1975) (defendant bears heavy burden to deny discovery)
Tradebay, LLC v. eBay, Inc., 278 F.R.D. 597 (D. Nev. 2011) (two-factor test for stays pending dispositive motions and requirement to take a "preliminary peek")