Stay of Civil Proceedings Due to Criminal Investigation - Mandamus


Ex parte McDaniel, [Ms. 1180199, May 24, 2019] __ So. 3d __ (Ala. 2019). The Court unanimously (Shaw, J.; Parker, C.J., and Bolin, Wise, Bryan, Sellers, Mendheim, Stewart, and Mitchell, JJ., concur) issues a writ of mandamus vacating the Shelby Circuit Court’s order staying a civil action against a number of defendants, including Jeffrey Rusert, who was the target of a federal criminal investigation.

The only evidence before the trial court when the stay was issued was a target letter Rusert had received from the United States Department of Justice. Ms. *6-7. The Court noted that “‘a motion to stay civil discovery during the pendency of a federal criminal proceeding is not properly granted upon speculative or conclusory grounds.’” Ms. *17, quoting Ex parte Ebbers, 871 So. 2d 776, 788 (Ala. 2003) (internal quotation marks omitted).

The Court held that nothing in the very general target letter “indicates that the offenses being investigated by the federal grand jury – bank fraud and wire fraud – are in any way connected to the McDaniels’ lawsuit.” Ms. *15. “[I]n cases in which this Court has found that civil and criminal proceedings were ‘parallel’ for purposes of requesting a stay of the civil proceeding, there was clear evidence demonstrating that those proceedings shared overlapping acts or incidents.” Ibid.

The defendants attached to their response to the mandamus petition a number of emails and other documents that were not submitted to the circuit court. The Supreme Court struck those materials and reiterated that it does not consider evidence presented for the first time in support of or in opposition to a mandamus petition. Ms. *10, citing Ebbers, 871 So. 2d at 794.

The Court also rejected the defendants’ effort to rely on statements of their counsel in the hearing on the motion to lift the stay. The Court held “[f]or the same reasons the exhibits discussed above were stricken, counsel’s statements at this hearing did not form the basis of the trial court’s order and are not before us. In any event, even if those statements were before us, it is well settled that assertions of counsel are not evidence.” Ms. *18.

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