USA Law and Practice Contributed by: Steven Molo, Robert Kry, Megan Cunniff Church and Walter Hawes, MoloLamken LLP
themselves to being filed ex parte, as the relief requested may concern an opposing party’s destruc - tion of evidence or secretion of assets. Nevertheless, in filing a motion ex parte, counsel should be aware of the additional hurdles necessary to justify granting relief without notice to the opposing party. 2.5 Criminal Redress In the United States, the DOJ and state prosecutors are responsible for prosecuting criminal cases. While victims of fraud may inform the relevant investigating bodies – such as the FBI or state investigators – of possible fraud, there is no formal method for victims to commence a criminal action. Parallel proceedings may occur if the government has instituted criminal proceedings at the same time as a civil proceeding, or vice versa. Civil and criminal litiga - tion have different discovery rules, leading to ques - tions about what kind of discovery can be used in which matter. A court may also stay one action until the conclusion of the other. Because of the rules gov - erning criminal prosecutions, it is extremely unlikely that a criminal case would be paused to allow for the continuance of a civil case, so stays in parallel pro - ceedings generally concern civil cases. Whether a stay of civil proceedings is appropriate turns on the particular circumstances of the case. A civil case may be stayed where continuing would result in undue prejudice or a substantial interference with a defendant’s constitutional rights. The mere existence of a criminal case will not automatically stay a civil proceeding; the civil case will only be stayed if there are unreasonable conflicts between the parallel proceedings. 2.6 Judgment Without Trial Where a defendant fails to appear within the required time or fails to answer a complaint, a plaintiff may seek a default judgment, which is a binding judgment in favour of the plaintiff and does not require a trial. The default judgment may be set aside by the court in limited circumstances, such as where the defendant was not given proper notice of the proceeding. A plaintiff may move for summary judgment prior to trial. If the plaintiff can show there is no genuine dis -
pute as to any material fact and the plaintiff is entitled to judgment as a matter of law, the court will grant summary judgment in favour of the plaintiff without a trial. A motion for summary judgment may ordinarily be filed at any time until 30 days after the close of discovery. 2.7 Rules for Pleading Fraud As discussed in 1.1 General Characteristics of Fraud Claims , claims sounding in fraud are subject to a heightened pleading standard. Federal Rule of Civil Procedure 9 (b) requires allegations of fraud to “state with particularity the circumstances constituting” the fraud. State rules generally impose a similar height - ened pleading requirement. Fraud claims therefore require more detail than other types of claims. Merely alleging that some type of fraud took place is not enough – the allegations must be supported by particular details describing the fraud. 2.8 Claims Against “Unknown” Fraudsters A plaintiff can sue “John Doe” or “Jane Doe” defend - ants for fraud. These fictitious defendants are persons that cannot be identified by the plaintiff before a law - suit is filed. Given that the statute of limitations for fraud can be short, a litigant is under a certain amount of pressure to file a claim, even if all the alleged fraud - sters are not known at the time of filing. Generally, filing a claim against a fictitious defendant tolls the statute of limitations. The plaintiff may later substitute the name of the true defendant for the ficti - tious defendant once that information is known. Once the complaint is filed, however, a plaintiff must work quickly to determine the true identity of the fraudsters. If the plaintiff’s delay in doing so is unreasonable, the court may not allow amendment of the complaint, and any claim may become barred by the statute of limita - tions. 2.9 Compelling Witnesses to Give Evidence A party may serve a subpoena on a non-party, com - pelling them to testify or produce documents or other evidence, either before or at trial. If a witness defies the subpoena, including by refusing to give testimony or produce documents, they can be held in contempt.
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