United States v. PCPLV LLC

• Court: District Court, D. Nevada
• Decided: December 21, 2021
• Docket: 2:21-cv-00184
• Status: Unknown

Opinion

1 CHRISTOPHER CHIOU Acting United States Attorney 2 District of Nevada Nevada Bar Number 14853 3 ALLISON C. REPPOND 4 Assistant United States Attorney 5 U.S. Attorney’s Office 501 Las Vegas Boulevard South, Suite 1100 6 Las Vegas, Nevada 89101 (702) 388-6336 7 Allison.Reppond@usdoj.gov

8 Attorneys for the United States

9 UNITED STATES DISTRICT COURT 10 DISTRICT OF NEVADA 11 United Sates of America, Case No. 2:21-cv-00184-JCM-DJA 12

Plaintiff, 13 United States’ Ex Parte Fourth Motion to vs. Extend the Service Deadline 14

15 PCPLV LLC d/b/a Pinnacle Compounding 16 Pharmacy, Ofir Ventura, Cecelia Ventura, Brandon Jimenez, Robert Gomez, Gomez & 17 Associates, Inc., Rock’n Rob Enterprises, Amir Shalev, D.P.M., AS Enterprises, Inc., 18 and Ivan Lee Goldsmith, M.D., 19 Defendants. 20 21 Pursuant to Rule 6(b) of the Federal Rules of Civil Procedure, the United States 22 moves the Court for a fourth order extending the United States’ deadline to serve the 23 defendants in this matter. To allow for continued settlement discussions, the United States 24 requests an additional 90-day extension of the service deadline in this matter. The Court 25 previously provided an initial 60-day extension of the United States’ service deadline and 26 extended the service deadline from May 3, 2021 to July 2, 2021. Subsequently, the Court 27 also provided a second 90-day extension of the United States’ service deadline and extended 28 the deadline from July 2, 2021 to September 30, 2021. In light of continued settlement 1 discussions, the Court provided a third 90-day extension of the United States’ service 2 deadline and extended the deadline from September 30, 2021 to December 29, 2021. 3 The Court has broad discretion to provide the brief extension requested, and the 4 United States respectfully requests this Court grant its Fourth Motion to Extend the Service 5 Deadline in this matter. 6 Respectfully submitted this 20th day of December, 2021. 7 CHRISTOPHER CHIOU 8 Acting United States Attorney

9 /s/ Allison C. Reppond Allison C. Reppond 10 Assistant United States Attorney 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 Memorandum of Points and Authorities 2 I. Introduction 3 Pursuant to Rule 6(b) of the Federal Rules of Civil Procedure, the United States 4 moves the Court for an order extending the United States’ deadline to serve the defendants 5 in this matter. The United States’ service was initially extended by the Court from May 3, 6 2021 to July 2, 2021 on a showing of good cause. ECF 3, Ex Parte Order Granting United 7 States’ Ex Parte Motion to Extend the Service Deadline Under Rule 4(m) of the Federal 8 Rules of Civil Procedure. The Court provided a second extension of the United States’ 9 service deadline from July 2, 2021 to September 30, 2021 on a showing of good cause. ECF 5, 10 Ex Parte Order Granting United States’ Ex Parte Second Motion to Extend the Service 11 Deadline Under Rule 4(m) of the Federal Rules of Civil Procedure. The Court also 12 provided a third extension of the United States’ service deadline, from September 30, 2021 13 to December 29, 2021 on a showing of good cause. ECF 7, Ex Parte Order Granting 14 United States’ Ex Parte Third Motion to Extend the Service Deadline Under Rule 4(m) of 15 the Federal Rules of Civil Procedure. The United States now requests one additional 90- 16 day extension of the deadline to serve defendants. There is good cause for the requested 17 extension. 18 Since the Court granted the prior extensions of the service deadline, the United 19 States remained actively engaged in discussions with the defendants to determine if this 20 matter may be resolved without the burden and expense of protracted litigation. For 21 example, the United States has conducted multiple meetings with the defendants, 22 exchanged documents and information, engaged in substantive discussions regarding the 23 claims at issue in this matter and the potential for settlement, and discussed settlement 24 strategy internally, including with the impacted agencies, based on information exchanged 25 in various meetings and conversations between the parties. Those negotiations are still 26 ongoing and productive. As noted in the United States’ first Motion to Extend the service 27 deadline in this matter, all defendants have notice of the claims at issue and received an 28 1 informal copy of the Complaint, ECF 1. The parties have not opposed a fourth extension 2 of the service deadline, as it will further facilitate settlement discussion that will potentially 3 save the parties much time and expense. 4 Thus, there is good cause to extend the service deadline in this matter for 90 days, 5 from December 29, 2021 to March 29, 2022, to allow settlement discussions to continue 6 without disruption. Further, even if the Court finds good cause for an extension is lacking, 7 the Court should exercise its broad discretion to provide the brief extension requested. The 8 United States respectfully requests this Court grant its Fourth Motion to Extend the Service 9 Deadline in this matter. 10 II. Statement of Facts and Procedural History 11 This case arises from an illegal kickback scheme in which a compounding pharmacy 12 (owned and operated by defendant PCPLV LLC d/b/a Pinnacle Compounding Pharmacy 13 and its principals, defendants Ofir Ventura, Cecelia Ventura, and Brandon Jimenez) paid 14 illegal kickbacks to third-party marketers (including defendants Robert Gomez and his 15 businesses, Gomez & Associates, Inc., and Rock’n Rob Enterprises) and physicians 16 (including defendants Ivan Lee Goldsmith, M.D., Amir Shalev, D.P.M., and Shalev’s 17 business, AS Enterprises, Inc.) in exchange for referral of large volumes of prescriptions to 18 government healthcare beneficiaries for unnecessary and expensive compounded 19 medications. See generally ECF 1, United States’ Complaint. Two government healthcare 20 programs, TRICARE and CHAMPVA, and their beneficiaries were targets of this scheme. 21 Id. 22 Pinnacle billed TRICARE and CHAMPVA millions of dollars for compounded 23 prescription medications by Pinnacle. ECF 1 at ¶¶ 88–93. TRICARE and CHAMPVA, 24 believing the prescription claims to be legitimate, based in a proper physician-patient 25 relationship, medically necessary for their beneficiaries, and not based in an illegal 26 kickback scheme, paid the claims submitted by Pinnacle. Id. The United States filed suit on

27 1 The United States has been unable to engage in any substantive discussions on this issue with defendant Robert Gomez, as Mr. Gomez has made no plans to proceed with counsel. The United States has encouraged Mr. Gomez to 28 seek counsel and has also informally provided Mr. Gomez with a copy of the Complaint. 1 February 2, 2021 on behalf of TRICARE and CHAMPVA. The United States now seeks 2 recovery of damages incurred through payment of these false and fraudulent claims. See 3 generally ECF 1. 4 Prior to filing suit, the United States contacted counsel for the defendants and 5 informed them while the United States would be filing suit to preserve the United States’ 6 claims under the applicable statute of limitations, the United States also invited the 7 defendants to engage in early discussions toward a resolution of this matter. Those 8 discussions have since commenced and have been productive. 9 To promote continued settlement discussions, the United States filed its first Motion 10 to Extend the service deadline in this matter on April 23, 2021, seeking an extension of the 11 United States’ service deadline under Federal Rule of Civil Procedure 4(m). See generally 12 ECF 2, United States’ Ex Parte Motion to Extend the Service Deadline Under Rule 4(m) of 13 the Federal Rules of Civil Procedure. Under Rule 4(m), the United States’ initial deadline 14 to serve the defendants was May 3, 2021. The Court granted a 60-day extension of the 15 service deadline, extending the deadline for service to July 2, 2021. ECF 3. Those 16 settlement discussions remained productive, so the United States sought a second, 90-day 17 extension of the service deadline, which the Court granted, extending the deadline for 18 service to September 30, 2021. ECF 5. After settlement discussions remained productive, 19 the United States sought a second, 90-day extension of the service deadline, which the 20 Court granted, extending the deadline for service to September 30, 2021. ECF 5. Those 21 settlement discussions continued to be productive, leading the United States to obtain a 22 third extension of the service deadline to December 29, 2021. ECF 7. 23 While the parties remain engaged in discussions focused on a resolution of this 24 matter, the United States expects those discussions will not conclude before the current 25 December 29 service deadline. The United States has met with the various defendants, 26 exchanged documents and information, and discussed settlement via e-mail and phone 27 conversations. These discussions continue to present day and continue to be productive. 28 Though the United States expects all defendants can be served by December 29, 2021, the 1 United States asks for additional time to complete service in order to facilitate continued 2 settlement discussions with the various defendants. 3 III. Points and Authorities A. Good Cause Exists to Support a 90-Day Extension of the United States’ 4 Service Deadline in This Matter. 5 Generally, a plaintiff must serve defendants with summons within 90 days of the 6 filing of the Complaint. Fed. R. Civ. P. 4(m). Rule 6(b) of the Federal Rules of Civil 7 Procedure allows a party to seek an extension of any applicable deadline via motion and 8 upon a showing of good cause for the extension. Thus, if the plaintiff shows good cause for 9 an extension of the service deadline, “the court must extend the time for service for an 10 appropriate period.” Fed. R. Civ. P. 4(m) (emphasis added). After the plaintiff establishes 11 good cause, the court has no discretion to deny an extension of the service deadline. Id.; 12 Efaw v. Williams, 473 F.3d 1038, 1040 (9th Cir. 2007). Plaintiffs in need of an extension of 13 the service deadline are encouraged to seek relief from the court before the service deadline 14 has expired where possible. See Fed. R. Civ. P. 6(b); see also Mendez v. Elliot, 45 F.3d 75, 79 15 (4th Cir. 1995). 16 “In the ordinary course, a litigant who seeks an extension of time must show good 17 cause for the desired extension.” Rivera-Almodovar v. Instituto Socioeconomico Comunitario, ; 18 Inc., 730 F.3d 23, 27 (1st Cir. 2013). “If good cause is present, the district court must extend 19 time for service and the inquiry is ended.” Petrucelli v. Bohringer & Ratzinger, 46 F.3d 1298, 20 1305 (3rd Cir. 1995). The meaning of good cause in this context does not include mistakes 21 of counsel or a desire to amend the complaint in a particular action. Fimbres v. United States, 22 833 F.2d 138, 139 (9th Cir. 1987). 23 The analysis of whether good cause supports extension of the service deadline is an 24 equitable one that focuses on the totality of the circumstances. See Pioneer Inv. Servs. Co. v. 25 Brunswick Assocs. Ltd. P’ship, 507 U.S. 380, 395 (1993). A court’s response to requests to 26 extend service “should be consistent with the trend towards flexibility under [Federal] Rule 27 4(m)” See United States v. 2,164 Watches, More or Less Bearing a Registered Trademark of Guess?, 28 1 Inc., 366 F.3d 767, 772 (9th Cir. 2004) . Courts commonly consider three factors in 2 determining whether good cause exists, including (1) the reasonableness of plaintiff’s efforts 3 to serve, (2) prejudice to the defendant by lack of timely service, and (3) whether plaintiff 4 moved for an enlargement of time to serve. See MCI Telecomm. Corp. v. Teleconcepts, Inc., 71 5 F.3d 1086, 1097 (3rd Cir. 1995) (citing United States v. Nuttall, 122 F.R.D. 163, 166–67 (D. 6 Del. 1988)). “A plaintiff may also be required to show the following: (a) the party to be 7 served personally received actual notice of the lawsuit; (b) the defendant would suffer no 8 prejudice; and (c) plaintiff would be severely prejudiced if his complaint were dismissed.” 9 Boudette, 923 F.2d at 756. Ultimately, “when a plaintiff has offered an explanation for 10 noncompliance with the rule which could support a finding of “good cause,” the absence of 11 prejudice to the defendant is a factor that ought to be considered in assessing whether the 12 explanation offered justifies relief.” Floyd v. United States, 900 F.2d 1045, 1049 (7th Cir. 13 1990). 14 The United States seeks a fourth extension of the service deadline for the sake of 15 ongoing discussions focused on resolving this matter, not as a result of any neglect or 16 mistake. The United States has elected not to serve the defendants to date in hopes of 17 resolving most or all of the claims at issue and bringing an early end to this litigation. To 18 that end, the United States has held several meetings with the defendants, exchanged 19 documents and information with them, maintained continuous communication via e-mail 20 and phone with the defendants, and engaged in internal discussions focused on settlement 21 strategy based on information exchanged in various meetings and conversations between 22 the parties. Once service has occurred in this matter, a variety of deadlines fall into place, 23 including answer deadlines and various early motion deadlines. This will increase expense 24 to all parties and potentially disrupt early settlement efforts. 25 Further, the defendants have received notice of this lawsuit, were well aware of the 26 nature of the claims prior to filing, and will not be prejudiced by an additional extension of 27 the service deadline. To the contrary, all parties agree they will benefit from an extension of 28 the service deadline to allow for continued early settlement discussions. As there is good 1 cause to extend the service deadline, the Court should grant the United States’ Fourth 2 Motion to Extend and provide a brief, 90-day extension of the service deadline in this 3 matter. 4 B. Even Assuming Arguendo the Court Finds a Lack of Good Cause, the Court Should Exercise Its Discretion to Provide a Permissive Sixty-Day 5 Extension of the United States’ Service Deadline. 6 Even in the event the Court finds a lack of good cause to support a brief extension of 7 the United States’ service deadline, the Court still has broad discretion to provide an 8 extension of the service deadline. See 2,164 Watches, 366 F.3d at 772 (“We have previously 9 held that district courts have broad discretion under [Federal] Rule 4(m) to extend time for 10 service even without a showing of good cause.”). This principle reflects the idea that 11 “service of process is more flexible than it once was.” Id. (internal quotation marks and 12 citation omitted). A court’s response to a plaintiff’s request for additional time to serve the 13 defendants should reflect this flexibility. See id. If the plaintiff establishes “excusable 14 neglect” on the part of the plaintiff, the court should provide a permissive extension of the 15 service deadline. Hoffman v. Red Wing Brands of Am., Inc., No. 3:13–CV–00633–LRH–VPC, 16 2014 WL 4636349, at *4 (D. Nev. Sept. 16, 2014). 17 The court may consider four factors in determining whether a permissive extension 18 of the service deadline is appropriate: “(1) the danger of prejudice to the opposing party; (2) 19 the length of the delay and its potential impact on judicial proceedings; (3) the reason for 20 the delay; and (4) whether the movant acted in good faith.” Harco Nat’l Ins. Co. v. Ackerman, 21 No. 2:20-cv-01208-RFB-BNW, 2020 WL 6785934, at *2 (D. Nev. Nov. 17, 2020). In 22 determining whether an extension of the service deadline is appropriate, the district court 23 should particularly consider the prejudice that will result to the parties to the action if an 24 extension is (or is not) provided. See 2,164 Watches, 366 F.3d at 772. A lack of prejudice to 25 the defendants may “tip the scale” in favor of an extension of the service deadline. See MCI 26 Telecomm. Corp., 71 F.3d at 1097. 27 The defendants will not suffer prejudice by an additional brief extension of the 28 service deadline. Rather, all parties agree they will benefit from the extension, as they can 1 continue efforts for an early resolution of this matter and avoid unnecessary additional 2 expense. The United States, on the other hand, would be prejudiced by a denial of this brief 3 extension, including incurring the expense associated with serving the various defendants 4 and potential disruption of ongoing settlement discussions. Further, a portion of the United 5 States’ claims would be barred if this matter is dismissed, despite the United States’ efforts 6 to resolve the claims at issue without unduly burdening the Court. The United States brings 7 this Fourth Motion to Extend in good faith and for a justifiable reason, as the purpose of 8 this Motion is to promote resolution of this matter without prolonged litigation. Finally, 9 the United States only seeks a 90-day extension of the upcoming service deadline, which 10 will not result in undue delay to the parties or the Court. The United States respectfully 11 asks the Court to grant its Motion to Extend and provide an additional 90-day extension of 12 the service deadline. 13 IV. Conclusion 14 Based on the above, this Court should grant the United States’ Ex Parte Motion to 15 Extend the Service Deadline, provide a 90-day extension of the United States’ service 16 deadline, and require service to be completed by Tuesday, March 29, 2022, and grant any 17 such further relief to which the United States’ may be entitled. 18 Respectfully submitted this 20th day of December , 2021. 19 CHRISTOPHER CHIOU 20 Acting United States Attorney 21 /s/ Allison C. Reppond______________ 22 Allison C. Reppond 23 Assistant United States Attorney 24 25 26 27 28 1 Certificate of Service 2 I hereby certify that on December 20, 2021, I electronically filed the foregoing 3 United States’ Ex Parte Fourth Motion to Extend the Service Deadline with the Clerk of 4 the Court for the United States District Court for the District of Nevada using the 5 CM/ECF system 6 Dated this 20th day of December, 2021.

7 /s/ Allison C. Reppond _____________ Allison C. Reppond 8 Assistant United States Attorney United States Attorney’s Office 9

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 CHRISTOPHER CHIOU Acting United States Attorney 2 District of Nevada Nevada Bar Number 14853 3 4 ALLISON C. REPPOND Assistant United States Attorney 5 U.S. Attorney’s Office 6 501 Las Vegas Boulevard South, Suite 1100 Las Vegas, Nevada 89101 7 (702) 388-6336 Allison.Reppond@usdoj.gov 8 Attorneys for the United States 9

10 UNITED STATES DISTRICT COURT 11 DISTRICT OF NEVADA

12 United Sates of America, Case No. 2:21-cv-00184-JCM-DJA 13 Plaintiff, United States’ Ex Parte Fourth Motion to 14 vs. Extend the Service Deadline 15

16 PCPLV LLC d/b/a Pinnacle Compounding Pharmacy, Ofir Ventura, Cecelia Ventura, 17 Brandon Jimenez, Robert Gomez, Gomez & Associates, Inc., Rock’n Rob Enterprises, 18 Amir Shalev, D.P.M., AS Enterprises, Inc., and Ivan Lee Goldsmith, M.D., 19 Defendants. 20 21 22 The Court having considered the United States’ Ex Parte Fourth Motion to Extend 23 the service deadline, and good cause having been shown, it is ORDERED that: 24 (1) The motion is GRANTED; and 25 /// 26 /// 27 28 1 (2) The United States has up to and including March 29, 2022, to serve the 2 || defendants named in the Original Complaint [ECF 1]. 3 4 Respectfully submitted this 20th day of December, 2021 5 CHRISTOPHER CHIOU 6 United States Attorney 7 8 s/ Allison Reppond Allison Reppond 9 Assistant United States Attorney 10 11 12 13 ITIS SO ORDERED: 4 DATED this 21" day of December, 2021. 15 yw OY . □□□ 17 UNITED STATES MAGISTRATE JUDGE

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