Case 1:26-cv-24485-RKA Document 45-1 Entered on FLSD Docket 09/15/2026 Page 1 of 26 EXHIBIT A Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 1 of 25Page 2 of 26 1 Ryan J. Works (NSBN 9224) Jimmy F. Dahu (NSBN 17061) 2 MCDONALD CARANO LLP 2300 West Sahara Avenue, Suite 1200 3 Las Vegas, Nevada 89102 Tel: (702) 873-4100 rworks@mcdonaldcarano.com 4 jdahu@mcdonaldcarano.com 5 Attorneys for Citadel Securities LLC 6 Michael R. Hogue (NSBN 12400) GREENBERG TRAURIG LLP 7 10845 Griffith Peak Drive, Suite 600 Las Vegas, Nevada 89135 8 Tel: (702) 938-6909 hoguem@gtlaw.com 9 Attorneys for Anson Funds Management LP and Anson Advisors, Inc. 10 Jarrod L. Rickard (NSBN 10203) SEMENZA RICKARD LAW 11 10161 Park Run Drive, Suite 150 Las Vegas, Nevada 89145 12 Tel: (702) 835-6803 jlr@semenzarickard.com 13 Attorneys for Virtu Americas LLC 14 UNITED STATES BANKRUPTCY COURT 15 DISTRICT OF NEVADA 16 In re Case No.: 24-50792-gs 17 META MATERIALS INC., Chapter 7 18 Debtor. 19 CHRISTINA W. LOVATO, in her capacity as Adv. Case No.: 26-05036-gs 20 Chapter 7 Trustee of the Bankruptcy Estate of 21 Meta Materials Inc., META MATERIALS DEFENDANTS’ MOTION TO WITHDRAW INC.; AND DOUG COLLINS, individually REFERENCE OF ADVERSARY 22 and on behalf of all others similarly situated, PROCEEDING PURSUANT TO 28 U.S.C. § 157(d) AND FED. R. BANKR. P. 5011 23 Plaintiff, vs. 24 RELIEF IS SOUGHT FROM A UNITED 25 CITADEL SECURITIES LLC, VIRTU STATES DISTRICT JUDGE AMERICAS LLC, ANSON FUNDS 26 MANAGEMENT LP, and ANSON ADVISORS, INC., 27 Defendants. 28 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 2 of 25Page 3 of 26 1 PLEASE TAKE NOTICE that Defendants Citadel Securities LLC, Virtu Americas LLC, 2 Anson Funds Management LP, and Anson Advisors, Inc. (“Defendants”), by and through their 3 counsel, and pursuant to 28 U.S.C. § 157(d), Fed. R. Bankr. P. 5011(a), and Local Rule 5011 hereby 4 move to withdraw the district court’s reference of the above captioned Adversary Proceeding. This 5 motion is based on the following memorandum of points and authorities, all court records in this 6 7 matter for which judicial notice is respectfully requested under Fed. R. Evid. 201, and any argument 8 and evidence that may be presented at the hearing for this motion. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 3 of 25Page 4 of 26 1 TABLE OF CONTENTS 2 Page 3 PRELIMINARY STATEMENT...................................................................................................... 1 4 BACKGROUND ............................................................................................................................. 3 5 A. Meta Materials Dilutes Its Own Shares and Defrauds Its Own 6 Investors .................................................................................................................. 3 7 B. Trustee and Non-Debtor Plaintiff ........................................................................... 4 8 C. Rule 2004 Discovery ............................................................................................... 5 9 D. The Complaint......................................................................................................... 6 10 1. Putative Federal Securities Class Action .................................................... 6 11 2. Causes of Action Under Federal Securities Law ........................................ 7 3. Demand of Jury Trial .................................................................................. 8 12 ARGUMENT ................................................................................................................................... 8 13 I. MANDATORY WITHDRAWAL OF THE REFERENCE IS 14 WARRANTED .................................................................................................................... 8 15 A. Plaintiffs’ Market Manipulation Allegations Require Consideration 16 of Complex and Significant Federal Securities Law Issues .................................... 9 17 B. This Putative Class Action Requires the Court to Analyze Complex PSLRA Lead-Plaintiff Issues from the Outset ...................................................... 12 18 II. PERMISSIVE WITHDRAWAL OF THE REFERENCE IS ALSO 19 APPROPRIATE ................................................................................................................. 13 20 A. The Efficient Use of Judicial Resources Strongly Favors Withdrawal ............................................................................................................ 14 21 1. The Complaint’s Exchange Act Claims Are Non-Core ............................ 14 22 2. The Bankruptcy Court Likely Lacks Jurisdiction Over Class Claims ...... 15 23 B. Putative Class Action Status and Demand of Jury Trial Favor 24 Withdrawal ............................................................................................................ 16 25 C. No Factor Weighs Against Withdrawal ................................................................ 17 26 CONCLUSION .............................................................................................................................. 18 27 28 i Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 4 of 25Page 5 of 26 1 TABLE OF AUTHORITIES 2 Page(s) Cases 3 ATSI Commc’ns, Inc. v. Shaar Fund, Ltd., 4 493 F.3d 87 (2d Cir. 2007) ......................................................................................................... 11 5 Dunmore v. United States, 6 358 F.3d 1107 (9th Cir. 2004).................................................................................................... 14 7 Genius Grp. Ltd. v. Citadel Sec. LLC, 2026 WL 1760342 (S.D.N.Y. June 18, 2026).................................................................. 2, 12, 13 8 Gens v. Colonial Sav., F.A., 9 2012 WL 993713 (N.D. Cal. Mar. 23, 2012) ............................................................................. 16 10 Haigler v. Dozier (In re Dozier Fin., Inc.), 11 2018 WL 4599860 (D.S.C. Sept. 6, 2018) ................................................................................. 14 12 In re PG&E Corp., 2024 WL 4230403 (Bankr. N.D. Cal. Sept. 18, 2024)............................................................... 13 13 Lara v. Casimiro (In re Casimiro), 14 2006 WL 1581897 (E.D. Cal. June 6, 2006)........................................................................ 16, 17 15 Maitland v. Mitchell (In re Harris Pine Mills), 16 44 F.3d 1431 (9th Cir. 1995)...................................................................................................... 14 17 Malone v. Norwest Fin. Cal., Inc., 245 B.R. 389 (E.D. Cal. 2000) ................................................................................................... 17 18 Meghji v. Compound Labs, Inc. (In re Celsius Network LLC), 19 670 B.R. 379 (S.D.N.Y. 2025) ............................................................................................ passim 20 Mishkin v. Ageloff, 21 220 B.R. 784 (S.D.N.Y. 1998) ................................................................................................... 11 22 Morschauser v. Cont’l Cap. LLC (In re Devore Stop) 2024 WL 654914 (9th Cir. Feb. 16, 2024)................................................................................ 15 23 Ohio Sec. Ins. v. Affinitylifestyles.com, Inc. (In re Affinitylifestyles.com, Inc.), 24 2023 WL 4761634 (D. Nev. July 25, 2023)............................................................................... 15 25 Orion Pictures Corp. v. Showtime Networks, Inc. (In re Orion Pictures Corp.), 4 F.3d 1095 (2d Cir. 1993) ......................................................................................................... 14 26 27 Porter v. NationsCredit Consumer Disc. Co. (In re Porter), 295 B.R. 529 (Bankr. E.D. Pa. 2003)................................................................................... 15, 16 28 ii Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 5 of 25Page 6 of 26 1 Quantum BioPharma Ltd. v. CIBC World Mkts, Inc., 2026 WL 861678 (S.D.N.Y. Mar. 30, 2026) ............................................................................. 10 2 Rannd Res., Inc. v. Von Harten (In re Rannd Res., Inc.), 3 175 B.R. 393 (D. Nev. 1994) ....................................................................................................... 9 4 SEC v. ARVCO Cap. Rsch., LLC, 5 2012 U.S. Dist. LEXIS 167899 (D. Nev. Nov. 26, 2012) ........................................................... 9 6 Sec. Farms v. Int’l Bhd. of Teamsters, 124 F.3d 999 (9th Cir. 1997)............................................................................................ 9, 13, 14 7 Shurkin v. Golden State Vintners Inc., 8 |471 F. Supp. 2d 998 (N.D. Cal. 2006) ...................................................................................... 10 9 Taxel v. Elec. Sports Rsch. (In re Cinematronics, Inc.), 10 916 F.2d 1444 (9th Cir. 1990).................................................................................................... 17 11 Vestavia Hills, Ltd. v. U.S. Small Bus. Admin. (In re Vestavia Hills, Ltd.), 630 B.R. 816 (S.D. Cal. 2021) ..................................................................................................... 9 12 Walleye Opp. Master Fund Ltd. v. Silver Lake Grp., LLC (In re Silver Lake Grp., 13 LLC Sec. Litig.), 14 108 F.4th 1178 (9th Cir. 2024) .................................................................................................. 10 15 Statutes 16 15 U.S.C. § 78u-4............................................................................................................... 1, 2, 7, 12 17 28 U.S.C. § 157(b)(2)(A) ............................................................................................................... 14 18 28 U.S.C. § 157(b)(2)(O) ............................................................................................................... 14 19 28 U.S.C. § 157(d) .................................................................................................................. passim 20 Other Authorities 21 Bankr. D. Nev. L.R. 7012 ................................................................................................................ 8 22 Fed. R. Bankr. P. 7012(b) ................................................................................................................ 8 23 24 25 26 27 28 iii Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 6 of 25Page 7 of 26 1 PRELIMINARY STATEMENT 2 This Adversary Proceeding does not belong in the Bankruptcy Court. It is a putative federal 3 securities class action brought pursuant to the Private Securities Litigation Reform Act (“PSLRA”) 4 alleging market manipulation by Defendants in violation of Sections 9(a)(2), 9(e), 10(b), and 20A 5 of the Securities Exchange Act of 1934 (the “Exchange Act”). The Complaint asserts no 6 7 Bankruptcy Code claims. Nor are the allegations related to any conduct in bankruptcy. Resolving 8 this non-core proceeding will require consideration of complex federal securities law issues, which 9 Congress intended for Article III courts, not bankruptcy courts, to decide. Because the Trustee (on 10 behalf of the Debtor’s estate) and the non-debtor Plaintiff Doug Collins inappropriately filed this 11 putative securities class action in the Bankruptcy Court, Defendants now move to withdraw the 12 reference. 13 Mandatory withdrawal is warranted under 28 U.S.C. § 157(d) for several reasons. The 14 15 Complaint’s core allegations are that two Defendants engaged in “spoofing”—placing and rapidly 16 cancelling orders—that artificially depressed the stock price of Debtor Meta Materials, Inc. (“Meta 17 Materials” or the “Debtor”) while its stock was listed and that two Defendants purportedly engaged 18 in allegedly improper short-selling around Meta Materials’ securities offering. Applying federal 19 securities law to such allegations presents significant securities law issues, including the heightened 20 pleading standard, the purported manipulative acts, alleged scienter, loss causation, reliance, and 21 22 inquiry notice relating to the statute of limitations. Only a limited number of courts have ever dealt 23 head-on with private securities litigation predicated on similar allegations, and all such cases have 24 been litigated in Article III district courts, not bankruptcy courts. 25 The PSLRA’s lead-plaintiff process, which raises significant legal issues better addressed 26 in Article III district courts, further underscores why this action should not proceed in the 27 Bankruptcy Court. The Court must determine whether the proposed lead plaintiff’s claims are 28 1 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 7 of 25Page 8 of 26 1 typical of the class, whether the lead plaintiff can fairly and adequately protect the interests of the 2 class, and whether its selection of class counsel should be approved. See 15 U.S.C. § 78u-4. That 3 process will also involve significant federal procedural questions, including whether the Trustee 4 (acting for the Debtor) and non-debtor Plaintiff Collins may serve as lead plaintiffs and whether 5 their shared special counsel may serve as lead counsel. It is highly unusual for an issuer like the 6 7 Debtor here to seek appointment as lead plaintiff for its own shareholders—all the more so where 8 the Debtor and its insiders have themselves been charged with market manipulation surrounding 9 the Debtor’s stock. Indeed, one federal district court recently recognized the unique posture of a 10 similar request and denied the issuer’s motion as well as appointment of its proposed lead counsel— 11 the same three firms representing the Trustee and Collins here. See Genius Grp. Ltd. v. Citadel 12 Sec. LLC, 2026 WL 1760342, at *7 (S.D.N.Y. June 18, 2026). 13 The firms’ dual representation of the Trustee and Collins, a non-debtor plaintiff, raises 14 15 additional concerns: the firms and Trustee obtained confidential trading data from Defendants 16 through Rule 2004 discovery—data that is “preclud[ed] [from] dissemination . . . beyond the trustee 17 and her professionals for use in this bankruptcy,” ECF No. 2821 at 5—and each represented that it 18 had “no connections with [Meta Materials’] shareholders or other parties-in-interest.” See ECF 19 Nos. 98-100, 2933-35. Nevertheless, the firms now represent Collins, who is not entitled to the 20 Rule 2004 discovery. Material consideration of the PSLRA and these threshold appointment issues 21 22 will drive this litigation from its outset. Mandatory withdrawal is warranted. 23 Permissive withdrawal is independently warranted. A district court may withdraw the 24 reference “for cause shown.” 28 U.S.C. § 157(d). First, withdrawal promotes judicial efficiency 25 because the Complaint asserts only federal securities law claims, which are plainly non-core issues 26 that do not depend on the Bankruptcy Code and could have been brought in district court. Any 27 determination by the Bankruptcy Court in this case would thus be subject to unnecessarily 28 2 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 8 of 25Page 9 of 26 1 duplicative de novo review by this Court. Second, the Bankruptcy Court likely lacks subject-matter 2 jurisdiction over the claims of Collins and absent class members. Leaving this Adversary 3 Proceeding in bankruptcy court would thus risk parallel proceedings, with the Trustee’s individual 4 action continuing in the Bankruptcy Court (and any ruling subject to de novo review by the Court) 5 and a separate class action filed elsewhere. Third, both the class nature of the proceeding and the 6 7 Complaint’s demand for a jury trial further support permissive withdrawal. No factor weighs 8 against permissive withdrawal. 9 The Court should withdraw the reference. 10 BACKGROUND1 11 A. Meta Materials Dilutes Its Own Shares and Defrauds Its Own Investors 12 Meta Materials was a Canada-headquartered corporation that went public through a reverse 13 merger and was listed on NASDAQ on June 28, 2021. During the Class Period, the Debtor 14 15 conducted a series of transactions that progressively diluted the value of existing shares. Those 16 transactions included registered direct offerings paired with an equal number of warrants, Compl. 17 ¶¶ 32, 36; ongoing sales of newly issued shares through an at-the-market program, id. ¶ 33; and a 18 “confidentially marketed public offering” of stock and warrants containing an anti-dilution 19 provision that automatically reduced the warrants’ exercise price to match any subsequent lower- 20 priced issuance of the same class of securities, id. ¶ 34. 21 22 The Debtor publicly attributed the decline in its stock price to manipulation by third parties. 23 In June 2023, the Debtor announced it had retained Christian Attar (formerly known as Christian 24 Smith & Jewell LLP), one of the firms now representing the Trustee and Non-Debtor Plaintiff in 25 this action, to investigate “instances of illegal trading, particularly by naked short sellers.” Ex. 1 26 27 1 All references to ECF Nos. in this Memorandum refer to the Meta Materials’ bankruptcy 28 proceeding, Case No. 24-50792-gs, and all references to “Compl.” below refer to ECF No. 1. 3 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1 Entered Entered09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 9 of 25 Page 10 of 26 1 (June 27, 2023 Press Release) at 2. In May 2024, the Debtor announced that its legal team had 2 “concluded that [Meta Materials] has meritorious claims for market manipulation against several 3 parties.” Ex. 2 (May 20, 2024 Press Release) at 1. 4 In June 2024, however, the U.S. Securities and Exchange Commission (“SEC”) charged the 5 Debtor and two of its former CEOs with conducting a “sophisticated, yet brazen” manipulative 6 7 scheme of Debtor’s stock in June 2021. Ex. 3 (June 25, 2024 SEC Press Release) at 2. According 8 to the SEC, the Debtor engaged “in a scheme to inflate the price of its stock and defraud investors 9 through numerous material misstatements and omissions about the potential value of a stock 10 dividend to be issued as part of the [reverse] merger,” cashing in $137.5 million. Ex. 4 (SEC Cease- 11 and-Desist Order) at 2. In early 2024, Meta Materials also settled a federal securities class action 12 brought by its own investors alleging the Company made material misrepresentations in connection 13 with the same reverse merger. See In re Meta Materials Inc. Sec. Litig., No. 1:21-cv-07203 14 15 (E.D.N.Y. final judgment and order of dismissal entered, and case terminated, on May 22, 2024). 16 Later that year, on August 9, 2024, Meta Materials filed for Chapter 7 bankruptcy in the 17 United States Bankruptcy Court for the District of Nevada and ceased operations. ECF No. 1. On 18 August 21, 2024, Meta Materials was delisted from NASDAQ. Ex. 5 (August 14, 2024 Form 8-K) 19 at 2. 20 B. Trustee and Non-Debtor Plaintiff 21 22 Christina Lovato was appointed Trustee on August 15, 2024 following Meta Materials’ 23 bankruptcy filing. ECF No. 14. In October 2024, the Trustee retained Christian Attar and Kasowitz 24 Benson Torres LLP as “special counsel” specifically to pursue litigation for alleged stock 25 manipulation through practices such as “naked short selling” and “spoofing.” ECF No. 98-1 at 2. 26 The Trustee included Grant & Eisenhofer as additional “special counsel” (and sought the court’s 27 approval for the same) for the first time on the same day the instant action was filed. ECF No. 28 4 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 10 of 25 Page 11 of 26 1 2933. In their declarations in support of the Trustee’s ex parte application to employ the law firms 2 on a contingency basis, all three firms represented that they had “no connections with” the Trustee, 3 “the Estate’s creditors, shareholders or other parties-in-interest.” ECF Nos. 98-100, 2933-35. 4 Plaintiff Doug Collins (“Non-Debtor Plaintiff,” together with the Trustee, “Plaintiffs”) in 5 this Adversary Action is an individual residing in Tennessee. Compl. ¶ 15. Collins was allegedly 6 7 a shareholder of Meta Materials during the Alleged Class Period. 2 Id. Collins filed three proofs of 8 interest on December 13, 2024 and January 6, 2026 in the bankruptcy case, referring to himself as 9 having an “investor”-based equity interest in the Debtor. See ECF Nos. 724, 2511, 2512. Collins 10 is represented by the same three firms—Christian Attar, Kasowitz Benson Torres LLP, and Grant 11 & Eisenhofer—who are also representing the Trustee in this case. See Compl. at 1. 12 C. Rule 2004 Discovery 13 In March 2025, the Trustee served Rule 2004 examination subpoenas to seek discovery in 14 15 the bankruptcy proceeding of voluminous trading data from Defendants. ECF Nos. 1614-17, 1630- 16 33. Defendants objected and raised concerns that the subpoenas were being employed to 17 improperly pursue discovery in support of claims not on behalf of the Debtor or for the benefit of 18 the Debtor’s estate. See ECF No. 2425 at 6-8. Defendants also pointed to several ongoing similar 19 federal manipulation claims against Citadel Securities LLC (“Citadel Securities”) and Virtu 20 Americas LLC (“Virtu”) filed by the same special counsel to the Trustee, noting the risk that any 21 22 evidence obtained from the Rule 2004 examinations would be used to circumvent the procedural 23 safeguards of the Federal Rules of Civil Procedure and the PSLRA and confer an unfair advantage 24 to non-debtor litigants against the same Defendants. See ECF No. 2632 at 13-14. 25 26 27 2 The Alleged Class Period, as set forth in the Complaint, is June 28, 2021 to August 20, 2024. 28 Compl. at 1. 5 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 11 of 25 Page 12 of 26 1 On February 20, 2026, after multiple rounds of briefing and two hearings, the Bankruptcy 2 Court issued an order requiring Defendants to produce certain material and data because the Trustee 3 “is entitled under Rule 2004 ‘to determine the scope of viable claims that may exist . . . against 4 potential third parties that may be culpable for causing such harm to the’ debtor.” ECF No. 2821 5 at 4. But because of the “concerns regarding special counsel’s disinterestedness [] suggest[ing] that 6 7 these Rule 2004 examinations may not be sought solely for the benefit of the debtor’s estate,” the 8 court found it appropriate to enter a protective order “precluding the dissemination of the produced 9 information beyond the trustee and her professionals for use in this bankruptcy.” Id. at 5. That 10 protective order was subsequently entered, requiring that any production made thereunder be solely 11 for the Trustee and her court-appointed counsel. See ECF No. 2887 at 4, ¶ 5. 12 D. The Complaint 13 1. Putative Federal Securities Class Action 14 15 On August 7, 2026, the Trustee and the Non-Debtor Plaintiff Doug Collins filed this 16 Adversary Proceeding. Plaintiffs purport to “bring this action as a class action pursuant to Federal 17 Rule of Civil Procedure 23(a) and (b)(3) individually and on behalf of a Class consisting of all 18 persons and entities that transacted in the publicly traded securities of Meta Materials” during the 19 Alleged Class Period. Compl. ¶ 166. 20 The Complaint asserts claims against Defendants Citadel Securities and Virtu (together, the 21 22 “Broker-Dealer Defendants”), which are broker-dealers registered with the SEC. Id. ¶¶ 16-17, 40. 23 As market makers, Citadel Securities and Virtu help keep financial markets operating by being 24 ready to buy and sell securities at any time, helping to ensure quick execution and price stability. 25 The Complaint also asserts claims against Anson Funds Management LP, a Texas-based registered 26 investment advisor with the SEC, and Anson Advisors, Inc., a corporation organized under the laws 27 of Ontario and with a principal place of business in Ontario, registered with the Ontario Securities 28 6 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 12 of 25 Page 13 of 26 1 Commission, and registered as an exempt reporting advisor with the SEC (together, the “Anson 2 Funds Defendants”). Id. ¶¶ 18-19. 3 Although Plaintiffs filed the Complaint in the Bankruptcy Court, they proceeded to issue a 4 lead plaintiff notice pursuant to the requirement under the PSLRA. 15 U.S.C. § 78u-4(a)(1). In its 5 public notice, Plaintiffs’ counsel informed investors that they may be able to seek appointment as 6 7 lead plaintiff by “complying with the relevant provisions of the [PSLRA]” and move the court by 8 October 12, 2026. Ex. 6 (August 12, 2026 Business Wire Notice) at 3. 9 2. Causes of Action Under Federal Securities Law 10 The Complaint alleges four causes of action, all of which arise exclusively under the federal 11 securities laws. Compl. ¶ 24. No claims under the Bankruptcy Code are asserted. 12 Counts I and II, brought against all Defendants, allege violations of Section 10(b), Sections 13 9(a)(2) and 9(e) of the Exchange Act on the grounds that Defendants allegedly engaged in 14 15 manipulative trading schemes during the Alleged Class Period. Compl. ¶¶ 173-189. The 16 Complaint alleges that the Broker-Dealer Defendants engaged in pervasive “spoofing”—whereby 17 they allegedly placed massive volumes of buy-side or sell-side Baiting Orders with no intention to 18 execute and then rapidly cancelled the orders within seconds. Id. ¶¶ 62-66. Such “Baiting Orders” 19 allegedly misled other market participants into believing there was excess supply, in the case of 20 sell-side orders, or excess demand, in the case of buy-side orders. Id. Spoofers could allegedly 21 22 flash sell-side “Baiting Orders” to drive the price down and benefit from the downward price 23 movement through pre-existing short positions or by placing buy orders to acquire the stock at the 24 lower “spoofed” price. Id. ¶¶ 3-4. According to the Complaint, the continuous placement and 25 cancellation of thousands of Baiting Orders artificially depressed the price of Meta Materials stock 26 over time. Id. ¶ 64. 27 28 7 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 13 of 25 Page 14 of 26 1 In addition to alleging a spoofing scheme, the Complaint alleges that Virtu engaged in 2 “naked short selling,” which refers to selling short without having borrowed or arranged to borrow 3 securities to deliver to the buyer within the standard settlement period. Id. ¶ 5. It also alleges that 4 the Anson Funds Defendants purportedly engaged in manipulative conduct known as “shorting and 5 distorting” and that the Anson Funds Defendants also purportedly sold short on material nonpublic 6 7 information. Id. ¶ 111-13. 8 Count III asserts a separate Section 10(b) claim under the Exchange Act against the Anson 9 Funds Defendants under the misappropriation theory of insider trading, alleging that they 10 purportedly traded on material nonpublic information. Id. ¶¶ 190-192. 11 Count IV asserts a claim under Section 20A of the Exchange Act against the Anson Funds 12 Defendants, alleging that other investors transacted in Meta Materials securities at the same time 13 the Anson Funds Defendants were allegedly trading on nonpublic information. Id. ¶¶ 190-192, 14 15 200. 16 3. Demand of Jury Trial 17 The Complaint demands a jury trial on all counts. See id. at 1. Defendants have not 18 consented to a jury trial in the Bankruptcy Court. Pursuant to Fed. R. Bankr. P. 7012(b) and Local 19 Rule 7012, Defendants also have not consented to the entry of final orders or judgments by the 20 bankruptcy judge if it is determined that the bankruptcy judge, absent consent of the parties, cannot 21 22 enter final orders or judgments consistent with Article III of the United States Constitution. 23 ARGUMENT 24 I. MANDATORY WITHDRAWAL OF THE REFERENCE IS WARRANTED 25 A district court must withdraw the reference of an adversary proceeding “if the court 26 determines that resolution of the proceeding requires consideration of both Title 11 and other laws 27 of the United States regulating organizations or activities affecting interstate commerce.” 28 28 8 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 14 of 25 Page 15 of 26 1 U.S.C. § 157(d). The Ninth Circuit has held that Section 157 “mandates withdrawal in cases 2 requiring material consideration of non-bankruptcy federal law.” Sec. Farms v. Int’l Bhd. of 3 Teamsters, 124 F.3d 999, 1008 (9th Cir. 1997). Mandatory withdrawal turns on “whether the issue 4 to be decided involve[s] significant and material questions of non-bankruptcy federal law.” 5 Vestavia Hills, Ltd. v. U.S. Small Bus. Admin. (In re Vestavia Hills, Ltd.), 630 B.R. 816, 852-53 6 7 (S.D. Cal. 2021) (quotation and citation omitted). Withdrawal is warranted if the case requires 8 “significant interpretation of federal laws that Congress would have intended to have decided by a 9 district judge rather than a bankruptcy judge.” Id. at 850 (quotation and citation omitted). 10 Resolving the Complaint’s market-manipulation claims will require substantial and material 11 consideration of complex federal securities law—the hallmark of mandatory withdrawal under 28 12 U.S.C. § 157(d). This Court has previously viewed such consideration of federal securities law to 13 warrant mandatory withdrawal. See, e.g., Rannd Res., Inc. v. Von Harten (In re Rannd Res., Inc.), 14 15 175 B.R. 393, 396 (D. Nev. 1994) (mandatory withdrawal of adversary proceeding where the 16 claims involved “§ 12(2) of the Securities Act of 1933, § 10 of the Securities Exchange Act of 17 1934, and Rule 10b–5”); see also SEC v. ARVCO Cap. Rsch., LLC, 2012 U.S. Dist. LEXIS 167899, 18 at *4-5 (D. Nev. Nov. 26, 2012) (applying § 157(d) to deny motion to refer to bankruptcy court 19 where “the complaint allege[d] violations of Section 17(a)(1) of the Securities Act and Section 20 10(b) and Rules 10b-5(a) and 10b-5(c) of the Exchange Act”). There is no reason to depart from 21 22 that precedent here. 23 A. Plaintiffs’ Market Manipulation Allegations Require Consideration of Complex and Significant Federal Securities Law Issues 24 Here, Plaintiffs allege that Defendants engaged in “spoofing” and other manipulative 25 conduct that gives rise to claims arising exclusively under the federal securities fraud statutes, i.e., 26 27 Sections 9(a)(2), 9(e), 10(b) and 20A of the Exchange Act and Rule 10b-5. On the face of the 28 Complaint, the only material issues the Court must consider to resolve this case arise under the 9 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 15 of 25 Page 16 of 26 1 substantive federal securities laws. And these are not run-of-the-mill securities fraud allegations: 2 from the Broker-Dealer Defendants’ review, approximately ten district courts have ever addressed 3 the application of federal securities law to “spoofing” allegations in a private lawsuit head on. 4 The Complaint alleges that the two Broker-Dealer Defendants engaged in market 5 manipulation through “spoofing” that artificially depressed Meta Materials’ stock price, which in 6 7 turn caused losses to the Debtor and investors that transacted in Meta Materials’ shares. Compl. ¶¶ 8 62-66. To assess such a manipulation claim based on spoofing, the Court must apply not only Rule 9 9(b)’s heightened pleading standard but also the exacting pleading requirements of the PSLRA to 10 determine significant federal securities law issues, including: (1) whether spoofing as a 11 “manipulative act” is sufficiently pleaded; (2) which “indicia differentiat[e] market manipulation 12 from legitimate trading for purposes of scienter”; (3) how spoofing, which by definition lasts only 13 seconds, may support loss causation under either “the theory of temporal proximity” or “a theory 14 15 of long-term impact”; (4) whether there was “reliance on an assumption of an efficient market free 16 of manipulation”; and (5) “whether and when” an issuer or an investor “should have been aware 17 of, or was on inquiry notice of Defendants’ alleged spoofing schemes.” See Quantum BioPharma 18 Ltd. v. CIBC World Mkts., Inc., 2026 WL 861678, at *15, 18-21 (S.D.N.Y. Mar. 30, 2026). 19 The same is true to resolve the purported “short selling” allegations, including those asserted 20 against the Anson Defendants. Alleged “[i]nsider trading actions must [also] meet the higher, 21 22 exacting pleading standards of Federal Rule of Civil Procedure 9(b) and the . . . PSLRA.” Walleye 23 Opp. Master Fund Ltd. v. Silver Lake Grp., LLC (In re Silver Lake Grp., LLC Sec. Litig.), 108 F.4th 24 1178, 1191 (9th Cir. 2024) (citation and quotation omitted). And similar key elements, including 25 scienter, will apply in the alleged insider trading and purported misappropriation context, and courts 26 must assess whether a plaintiff has made the mandatory “show[ing] that a defendant purchased or 27 sold securities while [actually] possessing material, non-public information.” Id.; see also Shurkin 28 10 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 16 of 25 Page 17 of 26 1 v. Golden State Vintners Inc., 471 F. Supp. 2d 998, 1025-26 (N.D. Cal. 2006), aff’d, 303 F. App’x 2 431 (9th Cir. 2008) (“blanket assertions” were not sufficient); ATSI Commc’ns, Inc. v. Shaar Fund, 3 Ltd., 493 F.3d 87, 101-02 (2d Cir. 2007) (because “short selling . . . is not, by itself, manipulative,” 4 the PSLRA’s heightened “pleading requirement is particularly important in manipulation claims 5 because in some cases scienter is the only factor that distinguishes legitimate trading from improper 6 7 manipulation”). 8 Article III courts should be—and have been—the fora to decide these federal securities law 9 issues. By way of example, private Exchange Act claims predicated on allegations of spoofing are 10 a recent phenomenon, and none have been brought in bankruptcy court. Indeed, the vast majority 11 were filed in the Southern District of New York. 3 The most relevant case authority will come from 12 decisions by the district courts that have considered the application of federal securities law to 13 spoofing. Mishkin v. Ageloff, 220 B.R. 784, 799 (S.D.N.Y. 1998) (mandatory withdrawal where 14 15 the court was “struck by the fact that the overwhelming majority of cases cited [] were decided by 16 Article III courts”). 17 Withdrawal of the reference is particularly appropriate because cases involving claims that 18 third parties “spoofed” a company’s stock price are relatively new. Celsius Network is directly on 19 point. Meghji v. Compound Labs, Inc. (In re Celsius Network LLC), 670 B.R. 379, 389 (S.D.N.Y. 20 2025). There, as here, a representative of a bankruptcy estate commenced an adversary proceeding 21 22 3 23 See, e.g., CP Stone Fort Holdings, LLC v. Does, No. 1:16-cv-4991 (N.D. Ill.); Chopper Trading LLC v. Allston Trading LLC, No. 1:19-cv-1674 (N.D. Ill.); Kessev Tov, LLC v. Doe(s), No. 1:20- 24 cv-4947 (N.D. Ill.); Harrington Glob. Opp. Fund, Ltd. v. CIBC World Mkts. Inc., No. 1:21-cv-761 (S.D.N.Y.); Nw. Biotherapeutics, Inc. v. Canaccord Genuity LLC, No. 1:22-cv-10185 (S.D.N.Y.); 25 Phunware, Inc. v. UBS Securities LLC, No. 1:23-cv-6426 (S.D.N.Y.); Mullen Auto., Inc. v. IMC Fin. Mkts., No. 1:23-cv-10637 (S.D.N.Y.); Quantum Biopharma Ltd. v. CIBC World Mkts., Inc., 26 No. 1:24-cv-7972 (S.D.N.Y.); Durkacz v. CIBC World Mkts, Inc., No. 1:25-cv-10565 (S.D.N.Y.); 27 Xdood LLC v. Interactive Brokers Grp., No. 1:25-cv-8536 (S.D.N.Y.); Genius Grp. Ltd., No. 1:25- cv-9546 (S.D.N.Y.); Asia Broadband, Inc. v. Virtu Fin. Inc., No. 2:26-cv-175 (C.D. Cal.); Reynolds 28 v. Citadel Sec. LLC, No. 1:26-cv-24485 (S.D. Fla.). 11 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 17 of 25 Page 18 of 26 1 asserting a federal securities-fraud claim arising from trading losses unrelated to any substantive 2 right under the Bankruptcy Code. The district court held that withdrawal of the reference of federal 3 securities claims involving cryptocurrencies was mandatory because adjudication was “not simply 4 a matter of applying well-established federal law to the specific facts of a case,” but rather of 5 “applying [precedent] to a novel set of circumstances.” Id. at 389. So too here. There is no direct 6 7 guidance from the Supreme Court or Ninth Circuit, and while a number of district courts have 8 rendered decisions on spoofing, they are “of recent vintage and were issued without the benefit of 9 any guidance from [higher courts].” Id. at 388. “Because this case necessitates significant 10 interpretation of [federal securities law] and involves more than the routine application of federal 11 laws outside the Bankruptcy Code,” the Court must withdraw the reference of this Adversary 12 Proceeding. Id. at 390 (quotation and citation omitted). 13 B. This Putative Class Action Requires the Court to Analyze Complex PSLRA 14 Lead-Plaintiff Issues from the Outset 15 Before assessing the Complaint’s allegations on a motion to dismiss, the Court will also be 16 required to address several significant legal issues that arise under the PSLRA. Plaintiffs’ counsel 17 issued a lead plaintiff notice as required by the PSLRA. 15 U.S.C. § 78u-4(a)(3)(A)(i). According 18 19 to the public notice, the deadline for Meta Materials investors to move for lead plaintiff is October 20 12, 2026. Ex. 6. Following that deadline, the Court will be required to apply the PSLRA and 21 assess, among other things, the highly unusual question of whether the Trustee, acting on behalf of 22 the Debtor’s estate, could serve as lead plaintiff in this putative class action. To Defendants’ 23 knowledge, only one court has decided whether an issuer can serve as lead plaintiff in a securities 24 class action and held that it cannot. See Genius Grp. Ltd., 2026 WL 1760342, at *3-5 (recognizing 25 the unique posture of the case and holding that the issuer failed the typicality and adequacy 26 27 requirements of Rule 23). That Court also held that the same three law firms that are special counsel 28 12 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 18 of 25 Page 19 of 26 1 to the Trustee and represent the Non-Debtor Plaintiff here could not serve as lead counsel for the 2 proposed class. Id. at *5. 3 The PSLRA’s lead plaintiff process may raise other complex issues as well, including 4 whether Plaintiffs’ counsel can serve as lead counsel while representing both the Trustee and the 5 Non-Debtor Plaintiff, the latter of whom is precluded from reviewing or utilizing the confidential 6 7 trading data obtained from Defendants through Rule 2004 discovery. 8 The PSLRA imposes on district courts an independent obligation to approve lead counsel 9 to prevent potential abuses in federal securities class actions. Id. at *7 (denying lead plaintiff and 10 lead counsel application where it “smack[ed] of the sort of lawyer-driven litigation that the PSLRA 11 aims to avoid”). This case, like other similar actions Plaintiffs’ counsel already filed against the 12 Broker-Dealer Defendants, requires careful consideration of the PSLRA in the lead counsel 13 approval process. 14 15 Ultimately, as another bankruptcy court in this circuit recently explained, “the PSLRA is 16 unfamiliar territory for bankruptcy courts to navigate” and bankruptcy courts typically “will not 17 venture there.” In re PG&E Corp., 2024 WL 4230403, at *4 (Bankr. N.D. Cal. Sept. 18, 2024) 18 (noting “very few reported cases of bankruptcy courts dealing head-on with the PSLRA”). 19 This Adversary Proceeding does not belong in the Bankruptcy Court. Mandatory 20 withdrawal of the reference is proper. 21 22 II. PERMISSIVE WITHDRAWAL OF THE REFERENCE IS ALSO APPROPRIATE 23 In addition to mandatory withdrawal, a district court may withdraw the reference “for cause 24 shown.” 28 U.S.C. § 157(d). “In determining whether cause exists, a district court should consider 25 the efficient use of judicial resources, delay and costs to the parties, uniformity of bankruptcy 26 administration, the prevention of forum shopping, and other related factors.” Sec. Farms, 124 F.3d 27 at 1008. Here, every relevant factor overwhelmingly favors withdrawal, and no countervailing 28 13 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 19 of 25 Page 20 of 26 1 consideration weighs against it. Permissive withdrawal is appropriate. 2 A. The Efficient Use of Judicial Resources Strongly Favors Withdrawal 3 1. The Complaint’s Exchange Act Claims Are Non-Core 4 The first factor of judicial efficiency favors withdrawal where “non-core issues 5 predominate.” Id. at 1008-09 (“Inasmuch as a bankruptcy court’s determinations on non-core 6 7 matters are subject to de novo review by the district court, unnecessary costs could be avoided by 8 a single proceeding in the district court.”); see also Celsius Network, 670 B.R. at 389 (“[T]he 9 ‘threshold’ inquiry in evaluating a request for permissive withdrawal was whether the claim was 10 core or non-core.”) (quoting Orion Pictures Corp. v. Showtime Networks, Inc. (In re Orion Pictures 11 Corp.), 4 F.3d 1095, 1101 (2d Cir. 1993)). 12 The Complaint’s claims, all arising under the Exchange Act, are non-core. Federal 13 securities law claims are quintessentially non-core issues because they “do not depend on Title 11 14 15 for their existence” and “the trustee could have brought them in the district court.” Dunmore v. 16 United States, 358 F.3d 1107, 1115 (9th Cir. 2004); see also Haigler v. Dozier (In re Dozier Fin., 17 Inc.), 2018 WL 4599860, at *4 (D.S.C. Sept. 6, 2018), report and recommendation adopted, 2019 18 WL 1075072 (D.S.C. Mar. 7, 2019) (holding “the Complaint’s causes of action [including 19 violations of the Securities Act and the Exchange Act] . . . have been routinely determined as non- 20 core proceedings by courts”) (collecting cases). Plaintiffs essentially concede as much by asserting 21 22 only “related to” jurisdiction of the bankruptcy court. Compl. ¶ 21. As the Ninth Circuit has 23 explained, “claims that are related to Title 11 are ‘noncore’ proceedings” whereas claims that “arise 24 under or in Title 11 are deemed to be ‘core’ proceedings.” Maitland v. Mitchell (In re Harris Pine 25 Mills), 44 F.3d 1431, 1435 (9th Cir. 1995). 26 The Complaint’s passing reference to 28 U.S.C. § 157(b)(2)(A) and (O) does not transform 27 this proceeding into a core matter. See Compl. ¶ 23. This Court has held that these two are “catch- 28 14 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 20 of 25 Page 21 of 26 1 all” provisions that must be “construed narrowly.” Ohio Sec. Ins. v. Affinitylifestyles.com, Inc. (In 2 re Affinitylifestyles.com, Inc.), 2023 WL 4761634, at *2 (D. Nev. July 25, 2023) (“[A]s courts 3 recognize a broad definition of what is core may pose constitutional problems, the catch-all 4 provisions in § 157 are construed narrowly.”); see also Celsius Network, 670 B.R. at 392-93 (“That 5 [debtor’s] claims might have a conceivable effect on the estate . . . does not transform the Adversary 6 7 Proceeding—which otherwise involves [] federal securities claims arising from pre-petition 8 conduct and unrelated to the Bankruptcy Code—into a core proceeding.”). 9 2. The Bankruptcy Court Likely Lacks Jurisdiction Over Class Claims 10 The efficiency factor also favors withdrawal because the Bankruptcy Court likely lacks 11 jurisdiction over a substantial portion of Plaintiffs’ claims. This Complaint is styled as a putative 12 class action in which Plaintiffs seek to recover from Defendants on behalf of all putative class 13 members, i.e., “all persons and entities that transacted in the publicly traded securities of Meta 14 15 Materials” during the Alleged Class Period. Compl. ¶ 166. But the Bankruptcy Court likely lacks 16 subject matter jurisdiction over the claims of these absent class members and those of the Non- 17 Debtor Plaintiff Collins because “[t]he disposition of such claims, regardless of their result, could 18 have no conceivable effect upon [the debtor’s] bankruptcy case.” Porter v. NationsCredit 19 Consumer Disc. Co. (In re Porter), 295 B.R. 529, 540-41 (Bankr. E.D. Pa. 2003) (concluding no 20 jurisdiction over class claims where the debtor “proposes to prosecute claims held by non-debtor 21 22 third parties against non-debtor defendants” and the putative class “[w]as not limited to debtors 23 (either past or present)”); cf. Morschauser v. Cont’l Cap. LLC (In re Devore Stop), 2024 WL 24 654914, at *1 (9th Cir. Feb. 16, 2024) (adversary proceeding not “related to the underlying 25 bankruptcy case because . . . whether or not [plaintiff] succeeds in his state-law claims, the estate 26 will receive no assets”). 27 28 15 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 21 of 25 Page 22 of 26 1 Just as in Porter, the putative class members in the Complaint and the Non-Debtor Plaintiff 2 are non-debtor investors of Meta Materials and any recovery achieved for the absent class members 3 and the Non-Debtor Plaintiff “belong[s] to those class members,” not the Debtor’s estate. 295 B.R. 4 at 540-41. Their alleged class claims therefore cannot be “classified as ‘related to’ a bankruptcy 5 case simply because the [Debtor] filed [its] own bankruptcy case and purports to hold similar 6 7 claims.” Id. 8 Because the Bankruptcy Court likely has no jurisdiction over the absent class members’ and 9 the Non-Debtor Plaintiff’s claims, leaving this Adversary Proceeding in the Bankruptcy Court 10 would potentially result in parallel litigations, with the Trustee’s individual action proceeding in 11 the Bankruptcy Court and a separate class action filed elsewhere with identical allegations. 12 Defending both actions would impose significant, unnecessary costs on Defendants to say nothing 13 of the unnecessary consumption of judicial resources in resolving the threshold jurisdictional issue. 14 15 Withdrawing the reference of this Adversary Proceeding now will avoid both the subject matter 16 jurisdiction complication and the potential “duplicative proceedings in both courts concerning the 17 same underlying allegations” since the District Court’s jurisdiction extends beyond what is 18 provided in the Bankruptcy Code and the District Court can undoubtedly hear this putative class 19 action. Gens v. Colonial Sav., F.A., 2012 WL 993713, at *3 (N.D. Cal. Mar. 23, 2012). 20 B. Putative Class Action Status and Demand of Jury Trial Favor Withdrawal 21 22 Two additional factors—that this Adversary Proceeding is a putative class action and that 23 the Complaint demands a jury trial—also favor withdrawal. 24 First, to the extent that the Bankruptcy Court has jurisdiction over the class claims, “the fact 25 that this case is a class action suit counsels against leaving it with the bankruptcy court.” Lara v. 26 Casimiro (In re Casimiro), 2006 WL 1581897, at *6 (E.D. Cal. June 6, 2006). Courts have 27 recognized that a case’s status as a class action is another factor supporting withdrawal. See, e.g., 28 16 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 22 of 25 Page 23 of 26 1 Malone v. Norwest Fin. Cal., Inc., 245 B.R. 389, 400 (E.D. Cal. 2000) (“Although bankruptcy 2 courts are empowered to oversee class actions, there is little reason to assume that they regularly 3 do so. On the other hand, the district court has long experience in the management of this complex 4 class of litigation.”); In re Casimiro, 2006 WL 1581897, at *6 (“Having the bankruptcy court 5 handle a class action suit would indeed impose a burden on that court and would not be an efficient 6 7 use of judicial resources.”) (quotation and citation omitted). 8 Second, the Complaint demands a jury trial on all counts. While not dispositive at this stage, 9 this is another factor in favor of withdrawal because “a bankruptcy court is empowered to conduct 10 jury trials only with the express consent of the parties.” Malone, 245 B.R. at 400-01 (finding jury 11 demand supported permissive withdrawal). Defendants do not consent to the bankruptcy court 12 presiding over a jury trial. See Taxel v. Elec. Sports Rsch. (In re Cinematronics, Inc.), 916 F.2d 13 1444, 1451 (9th Cir. 1990) (“[W]here a jury trial is required and the parties refuse to consent to 14 15 bankruptcy jurisdiction, withdrawal of the case to district court is appropriate.”). 16 C. No Factor Weighs Against Withdrawal 17 The other factors—including “uniformity of bankruptcy administration, [and] the 18 prevention of forum shopping”—are not at issue here. There is no forum shopping concern as 19 Defendants filed this motion to withdraw the reference before any substantive motion or pleading 20 has been filed with the Bankruptcy Court, let alone any ruling from the court on the Adversary 21 22 Proceeding. See In re Casimiro, 2006 WL 1581897, at *5 (no forum shopping concerns where 23 “Plaintiffs made a motion to withdraw before any motion for remand was made by Defendants 24 [before the bankruptcy court]” and “there has been no substantive ruling from the bankruptcy 25 court”). Withdrawal also has no effect on the uniformity of the bankruptcy administration since 26 the Complaint involves only non-core issues unrelated to the Bankruptcy Code. Celsius Network, 27 28 17 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 23 of 25 Page 24 of 26 1 670 B.R. at 394 (finding “this factor is neutral because the claims at issue are non-core claims that 2 do not arise under bankruptcy law”) (quotation and citation omitted). 3 Given that the factors overwhelmingly favor withdrawal, permissive withdrawal is also 4 warranted. 5 CONCLUSION 6 7 For the foregoing reasons, Defendants respectfully request that the Court withdraw the 8 reference of the above captioned Adversary Proceeding so that all matters are heard before the 9 District Court and grant such other relief to which Defendants may be entitled. 10 DATED: September 5, 2026 11 MCDONALD CARANO LLP 12 /s/ Ryan J. Works 13 Ryan J. Works (NSBN 9224) Jimmy F. Dahu (NSBN 17061) 14 2300 West Sahara Avenue, Suite 1200 Las Vegas, NV 89102 15 Tel: (702) 873-4100 rworks@mcdonaldcarano.com 16 jdahu@mcdonaldcarano.com 17 SIMPSON THACHER & BARTLETT LLP 18 Jonathan K. Youngwood (pro hac vice forthcoming) 19 Meredith Karp (pro hac vice forthcoming) Shuhao Fan (pro hac vice forthcoming) 20 425 Lexington Avenue New York, NY 10017 21 Tel: (212) 455-2000 jyoungwood@stblaw.com 22 meredith.karp@stblaw.com 23 shuhao.fan@stblaw.com 24 Attorneys for Citadel Securities LLC 25 26 27 28 18 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 24 of 25 Page 25 of 26 1 SEMENZA RICKARD LAW 2 /s/ Jarrod L. Rickard Jarrod L. Rickard (NSBN 10203) 3 10161 Park Run Drive, Suite 150 Las Vegas, NV 89145 4 Tel: (702) 835-6803 jlr@semenzarickard.com 5 PAUL, WEISS, RIFKIND, WHARTON & 6 GARRISON LLP 7 Andrew G. Gordon (pro hac vice forthcoming) 8 Audra J. Soloway (pro hac vice forthcoming) Alison R. Benedon (pro hac vice forthcoming) 9 Daniel S. Sinnreich (pro hac vice forthcoming) 1285 Avenue of the Americas 10 New York, NY 10019 11 Tel: (212) 373-3000 agordon@paulweiss.com 12 asoloway@paulweiss.com abenedon@paulweiss.com 13 dsinnreich@paulweiss.com 14 DAVIS WRIGHT TREMAINE LLP 15 Michael V. Rella (pro hac vice) 16 James K. Goldfarb (pro hac vice forthcoming) Shanaye Carvajal (pro hac vice) 17 1251 Avenue of the Americas 42nd Floor 18 New York, NY 10020 19 Tel: (212) 489-8230 michaelrella@dwt.com 20 jamesgoldfarb@dwt.com shanayecarvajal@dwt.com 21 22 Attorneys for Virtu Americas LLC 23 24 25 26 27 28 19 Case 1:26-cv-24485-RKA Case 26-05036-gs Document Doc 23 45-1Entered Entered 09/05/26 on FLSD14:21:01 Docket 09/15/2026 Page 25 of 25 Page 26 of 26 1 GREENBERG TRAURIG LLP 2 /s/ Michael R. Hogue Michael R. Hogue (NSBN 12400) 3 10845 Griffith Peak Drive, Suite 600 Las Vegas, Nevada 89135 4 Tel: (702) 938-6909 5 hoguem@gtlaw.com 6 Sylvia E. Simson (pro hac vice forthcoming) Alan J. Brody (pro hac vice forthcoming) 7 One Vanderbilt Avenue New York, NY 10017 8 Tel: (212) 801-9200 sylvia.simson@gtlaw.com 9 brodya@gtlaw.com 10 Attorneys for Anson Funds Management LP and Anson Advisors, Inc. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 20