United States v. PCPLV LLC

• Court: District Court, D. Nevada
• Decided: March 24, 2022
• 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 Fifth 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. The Court also granted the 27 United States’ second, third, and fourth requests for additional 90-day extensions of the 28 1 United States’ service deadline to allow ongoing settlement discussions to continue. The 2 United States’ current service deadline is March 29, 2022. 3 The Court has broad discretion to provide the brief extension requested, and the 4 United States respectfully requests this Court grant its Fifth Motion to Extend the Service 5 Deadline in this matter. 6 Respectfully submitted this 22nd day of March, 2022.

7 CHRISTOPHER CHIOU Acting United States Attorney 8

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 Court provided a fourth extension, in light of 16 ongoing settlement discussions, and extended the deadline upon a showing of good cause 17 from December 29, 2021 to March 29, 2022. ECF 9, Ex Parte Order Granting United 18 States’ Ex Parte Fourth Motion to Extend the Service Deadline Under Rule 4(m) of the 19 Federal Rules of Civil Procedure. The United States now requests one additional 90-day 20 extension of the deadline to serve defendants. There is good cause for the requested 21 extension. 22 Since the Court granted the prior extensions of the service deadline, the United 23 States remained actively engaged in discussions with the defendants to determine if this 24 matter may be resolved without the burden and expense of protracted litigation. For 25 example, the United States has conducted multiple meetings with the defendants, 26 exchanged documents and information, engaged in substantive discussions regarding the 27 claims at issue in this matter and the potential for settlement, and discussed settlement 28 strategy internally based on information exchanged in various meetings and conversations 1 between the parties. The United States is in the process of confirming its final settlement 2 strategy and authority and anticipates negotiations can continue forward efficiently and 3 effectively in the coming weeks. Settlement negotiations are still ongoing and productive. 4 As noted in the United States’ first Motion to Extend the service deadline in this matter, all 5 defendants have notice of the claims at issue and received an informal copy of the 6 Complaint, ECF 1. The parties1 have stated they do not oppose a third extension of the 7 service deadline, as it will further facilitate settlement discussion that will potentially save 8 the parties much time and expense. 9 Thus, there is good cause to extend the service deadline in this matter for 90 days, 10 from March 29, 2022, to June 27, 2022, to allow settlement discussions to continue without 11 disruption. Further, even if the Court finds good cause for an extension is lacking, the 12 Court should exercise its broad discretion to provide the brief extension requested. The 13 United States respectfully requests this Court grant its Fifth Motion to Extend the Service 14 Deadline in this matter. 15 II. Statement of Facts and Procedural History 16 This case arises from an illegal kickback scheme in which a compounding pharmacy 17 (owned and operated by defendant PCPLV LLC d/b/a Pinnacle Compounding Pharmacy 18 and its principals, defendants Ofir Ventura, Cecelia Ventura, and Brandon Jimenez) paid 19 illegal kickbacks to third-party marketers (including defendants Robert Gomez and his 20 businesses, Gomez & Associates, Inc., and Rock’n Rob Enterprises) and physicians 21 (including defendants Ivan Lee Goldsmith, M.D., Amir Shalev, D.P.M., and Shalev’s 22 business, AS Enterprises, Inc.) in exchange for referral of large volumes of prescriptions to 23 government healthcare beneficiaries for unnecessary and expensive compounded 24 medications. See generally ECF 1, United States’ Complaint. Two government healthcare 25 programs, TRICARE and CHAMPVA, and their beneficiaries were targets of this scheme. 26 Id.

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 Pinnacle billed TRICARE and CHAMPVA millions of dollars for compounded 2 prescription medications by Pinnacle. ECF 1 at ¶¶ 88–93. TRICARE and CHAMPVA, 3 believing the prescription claims to be legitimate, based in a proper physician-patient 4 relationship, medically necessary for their beneficiaries, and not based in an illegal 5 kickback scheme, paid the claims submitted by Pinnacle. Id. The United States filed suit on 6 February 2, 2021 on behalf of TRICARE and CHAMPVA. The United States now seeks 7 recovery of damages incurred through payment of these false and fraudulent claims. See 8 generally ECF 1. 9 Prior to filing suit, the United States contacted counsel for the defendants and 10 informed them while the United States would be filing suit to preserve the United States’ 11 claims under the applicable statute of limitations, the United States also invited the 12 defendants to engage in early discussions toward a resolution of this matter. Those 13 discussions have since commenced and have been productive. 14 To promote continued settlement discussions, the United States filed its first Motion 15 to Extend the service deadline in this matter on April 23, 2021, seeking an extension of the 16 United States’ service deadline under Federal Rule of Civil Procedure 4(m). See generally 17 ECF 2, United States’ Ex Parte Motion to Extend the Service Deadline Under Rule 4(m) of 18 the Federal Rules of Civil Procedure. Under Rule 4(m), the United States’ initial deadline 19 to serve the defendants was May 3, 2021. The Court granted a 60-day extension of the 20 service deadline, extending the deadline for service to July 2, 2021. ECF 3. Those 21 settlement discussions remained productive, so the United States three additional 90-day 22 extension of the service deadline, which the Court granted, extending the deadline for 23 service to September 30, 2021. ECF 5, 7, 9. The United States’ current service deadline is 24 March 29, 2022. 25 While the parties remain engaged in discussions focused on a resolution of this 26 matter, the United States expects those discussions will not conclude before the current 27 March 29 service deadline. The United States has met with the various defendants, 28 exchanged documents and information, and discussed settlement via e-mail and phone 1 conversations. The United States is also actively engaged in internal discussions regarding 2 final settlement strategy and authority and anticipates settlement discussions will proceed 3 efficiently and effectively throughout the coming weeks These discussions continue to 4 present day and continue to be productive. Though the United States expects all defendants 5 can be served by March 29, the United States asks for additional time to complete service 6 in order to facilitate continued settlement discussions with the various defendants. 7 III. Points and Authorities A. Good Cause Exists to Support a 90-Day Extension of the United States’ 8 Service Deadline in This Matter. 9 Generally, a plaintiff must serve defendants with summons within 90 days of the 10 filing of the Complaint. Fed. R. Civ. P. 4(m). Rule 6(b) of the Federal Rules of Civil 11 Procedure allows a party to seek an extension of any applicable deadline via motion and 12 upon a showing of good cause for the extension. Thus, if the plaintiff shows good cause for 13 an extension of the service deadline, “the court must extend the time for service for an 14 appropriate period.” Fed. R. Civ. P. 4(m) (emphasis added). After the plaintiff establishes 15 good cause, the court has no discretion to deny an extension of the service deadline. Id.; 16 Efaw v. Williams, 473 F.3d 1038, 1040 (9th Cir. 2007). Plaintiffs in need of an extension of 17 the service deadline are encouraged to seek relief from the court before the service deadline 18 has expired where possible. See Fed. R. Civ. P. 6(b); see also Mendez v. Elliot, 45 F.3d 75, 79 19 (4th Cir. 1995). 20 “In the ordinary course, a litigant who seeks an extension of time must show good 21 cause for the desired extension.” Rivera-Almodovar v. Instituto Socioeconomico Comunitario, ; 22 Inc., 730 F.3d 23, 27 (1st Cir. 2013). “If good cause is present, the district court must extend 23 time for service and the inquiry is ended.” Petrucelli v. Bohringer & Ratzinger, 46 F.3d 1298, 24 1305 (3rd Cir. 1995). The meaning of good cause in this context does not include mistakes 25 of counsel or a desire to amend the complaint in a particular action. Fimbres v. United States, 26 833 F.2d 138, 139 (9th Cir. 1987). 27 28 1 The analysis of whether good cause supports extension of the service deadline is an 2 equitable one that focuses on the totality of the circumstances. See Pioneer Inv. Servs. Co. v. 3 Brunswick Assocs. Ltd. P’ship, 507 U.S. 380, 395 (1993). A court’s response to requests to 4 extend service “should be consistent with the trend towards flexibility under [Federal] Rule 5 4(m)” See United States v. 2,164 Watches, More or Less Bearing a Registered Trademark of Guess?, 6 Inc., 366 F.3d 767, 772 (9th Cir. 2004) . Courts commonly consider three factors in 7 determining whether good cause exists, including (1) the reasonableness of plaintiff’s efforts 8 to serve, (2) prejudice to the defendant by lack of timely service, and (3) whether plaintiff 9 moved for an enlargement of time to serve. See MCI Telecomm. Corp. v. Teleconcepts, Inc., 71 10 F.3d 1086, 1097 (3rd Cir. 1995) (citing United States v. Nuttall, 122 F.R.D. 163, 166–67 (D. 11 Del. 1988)). “A plaintiff may also be required to show the following: (a) the party to be 12 served personally received actual notice of the lawsuit; (b) the defendant would suffer no 13 prejudice; and (c) plaintiff would be severely prejudiced if his complaint were dismissed.” 14 Boudette, 923 F.2d at 756. Ultimately, “when a plaintiff has offered an explanation for 15 noncompliance with the rule which could support a finding of “good cause,” the absence of 16 prejudice to the defendant is a factor that ought to be considered in assessing whether the 17 explanation offered justifies relief.” Floyd v. United States, 900 F.2d 1045, 1049 (7th Cir. 18 1990). 19 The United States seeks a fifth extension of the service deadline for the sake of 20 ongoing discussions focused on resolving this matter, not as a result of any neglect or 21 mistake. The United States has elected not to serve the defendants to date in hopes of 22 resolving most or all of the claims at issue and bringing an early end to this litigation. To 23 that end, the United States has held several meetings with the defendants, exchanged 24 documents and information with them, maintained continuous communication via e-mail 25 and phone with the defendants, and engaged in internal discussions focused on settlement 26 strategy based on information exchanged in various meetings and conversations between 27 the parties. These discussions are all ongoing, and the United States anticipates settlement 28 discussions will continue efficiently and effectively in the coming weeks once it confirms 1 final settlement strategy and authority. Once service has occurred in this matter, a variety 2 of deadlines fall into place, including answer deadlines and various early motion deadlines. 3 This will increase expense to all parties and potentially disrupt early settlement efforts. 4 Further, the defendants have received notice of this lawsuit, were well aware of the 5 nature of the claims prior to filing, and will not be prejudiced by an additional extension of 6 the service deadline. To the contrary, all parties agree they will benefit from an extension of 7 the service deadline to allow for continued early settlement discussions. As there is good 8 cause to extend the service deadline, the Court should grant the United States’ Third 9 Motion to Extend and provide a brief, 90-day extension of the service deadline in this 10 matter. 11 B. Even Assuming Arguendo the Court Finds a Lack of Good Cause, the Court Should Exercise Its Discretion to Provide a Permissive Sixty-Day 12 Extension of the United States’ Service Deadline. 13 Even in the event the Court finds a lack of good cause to support a brief extension of 14 the United States’ service deadline, the Court still has broad discretion to provide an 15 extension of the service deadline. See 2,164 Watches, 366 F.3d at 772 (“We have previously 16 held that district courts have broad discretion under [Federal] Rule 4(m) to extend time for 17 service even without a showing of good cause.”). This principle reflects the idea that 18 “service of process is more flexible than it once was.” Id. (internal quotation marks and 19 citation omitted). A court’s response to a plaintiff’s request for additional time to serve the 20 defendants should reflect this flexibility. See id. If the plaintiff establishes “exclusable 21 neglect” on the part of the plaintiff, the court should provide a permissive extension of the 22 service deadline. Hoffman v. Red Wing Brands of Am., Inc., No. 3:13–CV–00633–LRH–VPC, 23 2014 WL 4636349, at *4 (D. Nev. Sept. 16, 2014). 24 The court may consider four factors in determining whether a permissive extension 25 of the service deadline is appropriate: “(1) the danger of prejudice to the opposing party; (2) 26 the length of the delay and its potential impact on judicial proceedings; (3) the reason for 27 the delay; and (4) whether the movant acted in good faith.” Harco Nat’l Ins. Co. v. Ackerman, 28 No. 2:20-cv-01208-RFB-BNW, 2020 WL 6785934, at *2 (D. Nev. Nov. 17, 2020). In 1 determining whether an extension of the service deadline is appropriate, the district court 2 should particularly consider the prejudice that will result to the parties to the action if an 3 extension is (or is not) provided. See 2,164 Watches, 366 F.3d at 772. A lack of prejudice to 4 the defendants may “tip the scale” in favor of an extension of the service deadline. See MCI 5 Telecomm. Corp., 71 F.3d at 1097. 6 The defendants will not suffer prejudice by an additional brief extension of the 7 service deadline. Rather, all parties agree they will benefit from the extension, as they can 8 continue efforts for an early resolution of this matter and avoid unnecessary additional 9 expense. The United States, on the other hand, would be prejudiced by a denial of this brief 10 extension, including incurring the expense associated with serving the various defendants 11 and potential disruption of ongoing settlement discussions. Further, a portion of the United 12 States’ claims would be barred if this matter is dismissed, despite the United States’ efforts 13 to resolve the claims at issue without unduly burdening the Court. The United States brings 14 this Fifth Motion to Extend in good faith and for a justifiable reason, as the purpose of this 15 Motion is to promote resolution of this matter without prolonged litigation. Finally, the 16 United States only seeks a 90-day extension of the upcoming service deadline, which will 17 not result in undue delay to the parties or the Court. The United States respectfully asks the 18 Court to grant its Motion to Extend and provide an additional 90-day extension of the 19 service deadline. 20 21 22 23 24 25 26 27 28 1 IV. Conclusion 2 Based on the above, this Court should grant the United States’ Ex Parte Motion to 3 Extend the Service Deadline, provide a 90-day extension of the United States’ service 4 deadline, and require service to be completed by Monday, June 27, 2022, and grant any 5 such further relief to which the United States’ may be entitled. 6 Respectfully submitted this 22nd day of March, 2022. 7 CHRISTOPHER CHIOU 8 Acting United States Attorney 9 /s/ Allison C. Reppond______________ 10 Allison C. Reppond 11 Assistant United States Attorney 12 13 14 Certificate of Service 15 I hereby certify that on March 22, 2022, I electronically filed the foregoing United 16 States’ Ex Parte Fifth Motion to Extend the Service Deadline with the Clerk of the Court 17 for the United States District Court for the District of Nevada using the CM/ECF system 18 Dated this 22nd day of March, 2022.

19 /s/ Allison C. Reppond _____________ Allison C. Reppond 20 Assistant United States Attorney United States Attorney’s Office 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 Fifth 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 Fifth Motion to Extend the 23 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 June 27, 2022, to serve the defendants 2 || named in the Original Complaint [ECF 1]. 3 4 Respectfully submitted this 22nd day of March, 2022 5 CHRISTOPHER CHIOU 6 United States Attorney 7 8 s/ Allison Reppond Allison Reppond 9 Assistant United States Attorney 10 11 12 13 IT IS SO ORDERED: 14 DATED this 24th day of March 2022. 15 . 16 DANIEL J. ALBREGTS} 17 UNITED STATES MAGISTRATE JUDGE 18 19 20 21 22 23 24 25 26 27 28 12