3 *** SCOTT FRIEDMAN, an individual, 4 Case No.: 2:18-cv-00857-JCM-VCF Plaintiff, 5 REPORT AND RECOMMENDATION AND vs. ORDER TIERNEY, individually and in his official (1) JOINT MOTION FOR 7 capacity as an FBI Agent; MATTHEW A. ZITO, DETERMINATION OF GOOD FAITH 8 individually and in his official capacity as an FBI SETTLEMENT BY DEFENDANTS TALI ARIK Agent; THAYNE A. LARSON, individually and AND ARIK VENTURES, AND PLAINTIFF 9 in his official capacity as an FBI Agent; LAS SCOTT FRIEDMAN (ECF NO. 312); AND VEGAS METROPOLITAN POLICE (2) MOTION FOR LEAVE TO SEAL THE 10 DEPARTMENT; JOE LEPORE, P#6260, AMOUNT OF SETTLEMENT BETWEEN individually and in his official capacity as an DEFENDANTS TALI ARIK AND ARIK 11 officer of the LAS VEGAS METROPOLITAN VENTURES, AND PLAINTIFF SCOTT POLICE DEPARTMENT; DARREN HEINER, FRIEDMAN (ECF NO. 313) 12 P#2609, individually and in his official capacity as an officer of the LAS VEGAS 13 METROPOLITAN POLICE DEPARTMENT; JASON HAHN, P#3371, individually and in his 14 official capacity as an officer of the LAS VEGAS METROPOLITAN POLICE DEPARTMENT; 15 TALI ARIK; an individual; JULIE BOLTON, an 16 individual; and ARIK VENTURES, an entity formed by Tali Arik, 17 Defendant. 18 Joint Motion for Determination of Good Faith Settlement by Defendants Tali Arik and Arik 19 Ventures, and Plaintiff Scott Friedman (“Motion for Good Faith Settlement”) (ECF No. 312), and Motion 20 for Leave to Seal the Amount of Settlement Between Defendants Tali Arik and Arik Ventures, and 21 Plaintiff Scott Friedman (“Motion to Seal”) (ECF No. 313) having come on for hearing on the 14th day 22 of April 2020, and Lisa Rasmussen, Esq. and Melanie Hill, Esq. appearing on behalf of Plaintiff Scott 23 Friedman (“Plaintiff” or “Mr. Friedman”), Jesse Sbaih, Esq., appearing on behalf of Defendants Tali Arik 24 (“Dr. Arik”) and Arik Ventures (collectively “the Arik Defendants”), Greg Addington, Esq. appearing on 25 1 1 behalf of Co-Defendant United States of America, and Nicholas Crosby, Esq. appearing on behalf of Co- 2 Defendants Las Vegas Metropolitan Police Department, Joe Lepore, and Darren Heiner, and the Court 3 having reviewed the pleadings and papers on file herein, having held a telephonic hearing on the matter, 4 and good cause appearing, the Court makes the following findings: 5 I. 7 The Arik Defendants and Mr. Friedman (collectively, the “Settling Parties”) engaged in good faith 8 and arms-length negotiations which resolved this matter as to Mr. Friedman’s claims against the Arik 9 Defendants only, and had filed the subject Motion for Good Faith Settlement. (ECF No. 312). Pursuant 10 to the Settling Parties’ agreement, the settlement terms are confidential, and a Motion to Seal the 11 settlement amount so as to preserve the confidentiality was filed as ECF No. 313. 12 On May 11, 2018, Mr. Friedman filed the above-captioned matter against Dr. Arik, Arik Ventures, 13 Julie Bolton, the United States government, the Las Vegas Metropolitan Police Department (“LVMPD”), 14 and individuals from the FBI and LVMPD. (ECF No. 1). In his Complaint, Mr. Friedman essentially 15 argued that Dr. Arik conspired with his co-defendants to secure a criminal indictment and prosecution of 16 Mr. Friedman for wire fraud and conspiracy to commit wire fraud. Id. 17 On August 14, 2018, the Arik Defendants filed a Motion to Dismiss Mr. Friedman’s Complaint. 18 (ECF No. 54). On January 7, 2019, the Court issued an order dismissing Arik Ventures and some of Mr. 19 Friedman’s claims against Dr. Arik. (ECF No. 121). In the same Order, this Court dismissed the 20 individual claims against FBI agents Tierney, Zito, and Larson. Id. 21 Plaintiff reached a settlement with Defendant Julie Bolton in December 2019. (ECF No. 284). 22 Plaintiff also dismissed Defendant Jason Hahn from this case by stipulation and order. (ECF Nos. 292 23 and 300). At this time, after settling with the Arik Defendants, the remaining co-defendants are: The 24 25 2 1 United States of America, LVMPD, Joe Lepore, and Darren Heiner (collectively, the “Remaining Co- 2 Defendants”). 3 On March 12, 2020, Dr. Arik filed the subject Motion for Good Faith Settlement (ECF No. 312) 4 and the Motion to Seal (ECF No. 313). 5 The Remaining Co-Defendants did not file an opposition to Motion for Good Faith Settlement or 6 the Motion to Seal. 7 On April 1, 2020, Dr. Arik filed a Notice of Non-Opposition to Motion for Good Faith Settlement 8 (ECF No.316) and a Notice of Non-Opposition to Motion to Seal (ECF No. 317). 9 On April 14, 2020 a telephonic hearing was held on the matter. During the hearing, the Remaining 10 Co-Defendants, through their counsel, confirmed their non-opposition to granting of the Motion for Good 11 Faith Settlement and the Motion to Seal. 12 II. 14 Pursuant to NRS § 17.245, “any joint tortfeasor in a multi-defendant tort action may obtain 15 protection from claims of contribution and implied indemnity by settling with the tort claimant in good 16 faith.” The Doctors Co. v. Vincent, 120 Nev. 644, 645, 98 P.3d 681, 683 (2004). District courts in Nevada 17 assess the following factors when determining whether a settlement is made in good faith pursuant to NRS 18 § 17.245: “[t]he amount paid in settlement, the allocation of the settlement proceeds among plaintiffs, the 19 insurance policy limits of settling defendants, the financial condition of settling defendants and the 20 existence of collusion, fraud or tortious conduct aimed to injure the interests of non-settling defendants.” 21 In re MGM Grand Hotel Fire Litigation, 570 F. Supp. 913, 927 (D. Nev. 1983). 22 First, the amount paid in settlement is the most persuasive factor in this matter, particularly in light 23 of the fact that Arik Ventures had been previously dismissed from the action, some of the individual claims 24 25 3 1 against Dr. Arik were previously dismissed, and that extensive discovery during the past year revealed 2 various strengths and weaknesses in the claims asserted by Plaintiff and the defenses asserted by Dr. Arik. 3 Consequently, the Settling Parties both entered into negotiations and arrived at complete settlement. Since 4 the Settling Parties understand both the risks inherent in litigation and the costs and resources required 5 therein, the Settling Parties have decided to resolve this matter prior to having to prepare dispositive 6 motions and possibly prepare for trial. Indeed, the amount submitted to the Court and the Remaining Co- 7 Defendants under seal is reflective and reasonable with respect to the potential liability, if any, of the Arik 8 Defendants in this matter. 9 The second factor concerning the allocation between Plaintiffs is not applicable due to Mr. 10 Friedman being a single party. Regarding insurance limits, Arik Ventures (which was dismissed from the 11 action in January 2019) did not have insurance for defense and/or indemnity for the claims brought by 12 Mr. Friedman in this matter. On the other hand, Dr. Arik has a $300,000.00 homeowner’s policy and a 13 $5,000,000.00 umbrella policy with Farmers Insurance Company. 14 In addition, Arik Ventures’ financial condition is non-existent as it has been defunct for years. As 15 to Dr. Arik, his financial condition did not play a role in settlement discussions since Dr. Arik has abundant 16 insurance coverage. 17 Finally, no collusion, fraud or tortuous conduct aimed to injure the Remaining Co-Defendants 18 exists. For nearly a week, the Settling Parties engaged in lengthy and protracted settlement discussions 19 during which each side articulated the potential cost and exposure if the matter were to proceed to trial.
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3 *** SCOTT FRIEDMAN, an individual, 4 Case No.: 2:18-cv-00857-JCM-VCF Plaintiff, 5 REPORT AND RECOMMENDATION AND vs. ORDER TIERNEY, individually and in his official (1) JOINT MOTION FOR 7 capacity as an FBI Agent; MATTHEW A. ZITO, DETERMINATION OF GOOD FAITH 8 individually and in his official capacity as an FBI SETTLEMENT BY DEFENDANTS TALI ARIK Agent; THAYNE A. LARSON, individually and AND ARIK VENTURES, AND PLAINTIFF 9 in his official capacity as an FBI Agent; LAS SCOTT FRIEDMAN (ECF NO. 312); AND VEGAS METROPOLITAN POLICE (2) MOTION FOR LEAVE TO SEAL THE 10 DEPARTMENT; JOE LEPORE, P#6260, AMOUNT OF SETTLEMENT BETWEEN individually and in his official capacity as an DEFENDANTS TALI ARIK AND ARIK 11 officer of the LAS VEGAS METROPOLITAN VENTURES, AND PLAINTIFF SCOTT POLICE DEPARTMENT; DARREN HEINER, FRIEDMAN (ECF NO. 313) 12 P#2609, individually and in his official capacity as an officer of the LAS VEGAS 13 METROPOLITAN POLICE DEPARTMENT; JASON HAHN, P#3371, individually and in his 14 official capacity as an officer of the LAS VEGAS METROPOLITAN POLICE DEPARTMENT; 15 TALI ARIK; an individual; JULIE BOLTON, an 16 individual; and ARIK VENTURES, an entity formed by Tali Arik, 17 Defendant. 18 Joint Motion for Determination of Good Faith Settlement by Defendants Tali Arik and Arik 19 Ventures, and Plaintiff Scott Friedman (“Motion for Good Faith Settlement”) (ECF No. 312), and Motion 20 for Leave to Seal the Amount of Settlement Between Defendants Tali Arik and Arik Ventures, and 21 Plaintiff Scott Friedman (“Motion to Seal”) (ECF No. 313) having come on for hearing on the 14th day 22 of April 2020, and Lisa Rasmussen, Esq. and Melanie Hill, Esq. appearing on behalf of Plaintiff Scott 23 Friedman (“Plaintiff” or “Mr. Friedman”), Jesse Sbaih, Esq., appearing on behalf of Defendants Tali Arik 24 (“Dr. Arik”) and Arik Ventures (collectively “the Arik Defendants”), Greg Addington, Esq. appearing on 25 1 1 behalf of Co-Defendant United States of America, and Nicholas Crosby, Esq. appearing on behalf of Co- 2 Defendants Las Vegas Metropolitan Police Department, Joe Lepore, and Darren Heiner, and the Court 3 having reviewed the pleadings and papers on file herein, having held a telephonic hearing on the matter, 4 and good cause appearing, the Court makes the following findings: 5 I. 7 The Arik Defendants and Mr. Friedman (collectively, the “Settling Parties”) engaged in good faith 8 and arms-length negotiations which resolved this matter as to Mr. Friedman’s claims against the Arik 9 Defendants only, and had filed the subject Motion for Good Faith Settlement. (ECF No. 312). Pursuant 10 to the Settling Parties’ agreement, the settlement terms are confidential, and a Motion to Seal the 11 settlement amount so as to preserve the confidentiality was filed as ECF No. 313. 12 On May 11, 2018, Mr. Friedman filed the above-captioned matter against Dr. Arik, Arik Ventures, 13 Julie Bolton, the United States government, the Las Vegas Metropolitan Police Department (“LVMPD”), 14 and individuals from the FBI and LVMPD. (ECF No. 1). In his Complaint, Mr. Friedman essentially 15 argued that Dr. Arik conspired with his co-defendants to secure a criminal indictment and prosecution of 16 Mr. Friedman for wire fraud and conspiracy to commit wire fraud. Id. 17 On August 14, 2018, the Arik Defendants filed a Motion to Dismiss Mr. Friedman’s Complaint. 18 (ECF No. 54). On January 7, 2019, the Court issued an order dismissing Arik Ventures and some of Mr. 19 Friedman’s claims against Dr. Arik. (ECF No. 121). In the same Order, this Court dismissed the 20 individual claims against FBI agents Tierney, Zito, and Larson. Id. 21 Plaintiff reached a settlement with Defendant Julie Bolton in December 2019. (ECF No. 284). 22 Plaintiff also dismissed Defendant Jason Hahn from this case by stipulation and order. (ECF Nos. 292 23 and 300). At this time, after settling with the Arik Defendants, the remaining co-defendants are: The 24 25 2 1 United States of America, LVMPD, Joe Lepore, and Darren Heiner (collectively, the “Remaining Co- 2 Defendants”). 3 On March 12, 2020, Dr. Arik filed the subject Motion for Good Faith Settlement (ECF No. 312) 4 and the Motion to Seal (ECF No. 313). 5 The Remaining Co-Defendants did not file an opposition to Motion for Good Faith Settlement or 6 the Motion to Seal. 7 On April 1, 2020, Dr. Arik filed a Notice of Non-Opposition to Motion for Good Faith Settlement 8 (ECF No.316) and a Notice of Non-Opposition to Motion to Seal (ECF No. 317). 9 On April 14, 2020 a telephonic hearing was held on the matter. During the hearing, the Remaining 10 Co-Defendants, through their counsel, confirmed their non-opposition to granting of the Motion for Good 11 Faith Settlement and the Motion to Seal. 12 II. 14 Pursuant to NRS § 17.245, “any joint tortfeasor in a multi-defendant tort action may obtain 15 protection from claims of contribution and implied indemnity by settling with the tort claimant in good 16 faith.” The Doctors Co. v. Vincent, 120 Nev. 644, 645, 98 P.3d 681, 683 (2004). District courts in Nevada 17 assess the following factors when determining whether a settlement is made in good faith pursuant to NRS 18 § 17.245: “[t]he amount paid in settlement, the allocation of the settlement proceeds among plaintiffs, the 19 insurance policy limits of settling defendants, the financial condition of settling defendants and the 20 existence of collusion, fraud or tortious conduct aimed to injure the interests of non-settling defendants.” 21 In re MGM Grand Hotel Fire Litigation, 570 F. Supp. 913, 927 (D. Nev. 1983). 22 First, the amount paid in settlement is the most persuasive factor in this matter, particularly in light 23 of the fact that Arik Ventures had been previously dismissed from the action, some of the individual claims 24 25 3 1 against Dr. Arik were previously dismissed, and that extensive discovery during the past year revealed 2 various strengths and weaknesses in the claims asserted by Plaintiff and the defenses asserted by Dr. Arik. 3 Consequently, the Settling Parties both entered into negotiations and arrived at complete settlement. Since 4 the Settling Parties understand both the risks inherent in litigation and the costs and resources required 5 therein, the Settling Parties have decided to resolve this matter prior to having to prepare dispositive 6 motions and possibly prepare for trial. Indeed, the amount submitted to the Court and the Remaining Co- 7 Defendants under seal is reflective and reasonable with respect to the potential liability, if any, of the Arik 8 Defendants in this matter. 9 The second factor concerning the allocation between Plaintiffs is not applicable due to Mr. 10 Friedman being a single party. Regarding insurance limits, Arik Ventures (which was dismissed from the 11 action in January 2019) did not have insurance for defense and/or indemnity for the claims brought by 12 Mr. Friedman in this matter. On the other hand, Dr. Arik has a $300,000.00 homeowner’s policy and a 13 $5,000,000.00 umbrella policy with Farmers Insurance Company. 14 In addition, Arik Ventures’ financial condition is non-existent as it has been defunct for years. As 15 to Dr. Arik, his financial condition did not play a role in settlement discussions since Dr. Arik has abundant 16 insurance coverage. 17 Finally, no collusion, fraud or tortuous conduct aimed to injure the Remaining Co-Defendants 18 exists. For nearly a week, the Settling Parties engaged in lengthy and protracted settlement discussions 19 during which each side articulated the potential cost and exposure if the matter were to proceed to trial. 20 Based on such arm’s length and good faith negotiations, the Settling Parties reached a number they could 21 live with to halt the litigation and save resources. 22 It follows that the Remaining Co-Defendants will suffer no harm by this Court’s approval of the 23 settlement and finding that it was entered into in good faith. 24 25 4 1 In light of the Court’s consideration of the above, the Court finds that the subject settlement was 2 entered in good faith. 3 Additionally, the Settling Parties stipulated to a resolution of this matter with the mutual agreement 4 to keep confidential the settlement amount. The United States District Court for the District of Nevada 5 has previously held “that the confidentiality of the Settlement Agreement outweighs the public's right to 6 access” when “the parties reached a settlement and signed the Settlement Agreement in reliance on the 7 condition that the terms of the Settlement Agreement would remain confidential.” United Rentals, Inc. v. 8 Ahern Rentals, Inc., No. 2:12-cv-01876-JCM-VCF, 2012 WL 5418355, *1 (D. Nev. Nov. 2, 2012). In this 9 matter, the Settling Parties’ interest in maintaining the confidentiality of the settlement outweighs the 10 public's interest in knowing the specific settlement amount. Further, the Settling Parties’ request to submit 11 the settlement amount under seal is “’narrowly tailored’ to remove from the public sphere only the material 12 that warrants secrecy.” Blain v. Titanium Metals Corp., No. 2:18-cv-00462-APG-NJK, 2019 WL 13 1207929, *1 (D. Nev. Mar. 14, 2019) (internal citation omitted). 14 Therefore, the Court finds that good cause exists for sealing of the un-redacted Motion for Good 15 Faith Settlement which indicates the amount of the settlement among the Settling Parties. 16 Accordingly, 18 (1) Joint Motion for Determination of Good Faith Settlement by Defendants Tali Arik and Arik 19 Ventures, and Plaintiff Scott Friedman (ECF No. 312) is GRANTED; 20 (2) Any claims for equity indemnity and/or contribution against Defendants Tali Arik and Arik 21 Ventures are foreclosed by finding that the settlement with Plaintiff Scott Friedman was made in good 22 faith pursuant to NRS § 17.245; and 23 (3) Motion for Leave to Seal the Amount of Settlement Between Defendants Tali Arik and Arik 24 Ventures, and Plaintiff Scott Friedman (ECF No. 313) is GRANTED. 25 5 1 IT IS RECOMMENDED that any and all claims against Defendants Tali Arik and Arik Ventures 2 || be dismissed. 3 DATED this 22nd day of April, 2020. Load ato. 4 CAM FERENBACH 5 UNITED STATES MAGISTRATE JUDGE
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