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Nevada ruling in Johnson case could bring Swallow deposition

SALT LAKE CITY — A judge in the U.S. District Court of Nevada ruled Wednesday against federal prosecutors who sought to delay the civil case against Jeremy Johnson and his fellow defendants connected to the St. George online marketing company iWorks.

The decision leaves open the possibility that Utah Attorney General John Swallow could be subpoenaed in the case in the next six seeks, the timeframe given to complete depositions in the case.

Federal prosecutors in Utah had sought to halt the case, saying it could “wreak havoc” on parallel criminal proceedings against Johnson, iWorks and four other former iWorks employees in Utah’s Federal District Court.

But the iWorks defendants argued that would unfairly delay their case, perhaps for years, and they want to pursue depositions and other "discovery" in the case and clear their names.

“This is about getting into court. It’s about letting people see the true story. The government doesn’t always get it right,” said attorney Karra Porter, who represents iWorks in the Nevada civil case.

“Now the parties can move on and get a trial date without having to wait years,” she said Wednesday.

In her ruling, Nevada Judge Miranda Du wrote, “[T]he Court is mindful that it was the government’s decision—not Defendants’—to bring both (lawsuits) simultaneously.”

The Nevada civil suit against Johnson and his fellow defendants was brought in December 2010, while the Utah criminal case was filed roughly six months later, in June 2011.

In the civil FTC complaint in Las Vegas, the FTC contends iWorks bilked online customers of nearly $300 million. The 86-count criminal indictment in Salt Lake City alleges fraud.

The parallel cases have witnesses, facts and legal issues in common, which prompted a motion in April by government lawyers to halt the civil case while the criminal case proceeded. Du ruled on the motion Wednesday.

Johnson, who is acting as his own attorney in the Nevada case, as well as Porter, who represents iWorks and the majority of its defendants, can now resume depositions, which allows them to interview witnesses under oath in the presence of attorneys.

Johnson previously has sought to depose Swallow in the case, claiming in court documents, “[Swallow] became exceptionally well-versed in the dealings and details of the iWorks’ operations and the company’s fervent efforts to not just be in compliance with the law, but be leaders in the online marketing industry.”

Evidence submitted by Johnson to support the claim includes an email in which Swallow appears to be pitching joint ventures with iWorks, namely a payday loan marketing plan and a Cash for Gold project.

Swallow’s attorney, Rod Snow, has previously said the ventures never materialized and that Swallow had never intended to profit from the deals, but was only trying to connect his friend and former boss, Check City owner Richard Rawle, with iWorks marketing operation.

Neither the U.S. Attorney’s Office for Utah or Nevada were able to be reached for comment.