The opinion of the court was delivered by: The Honorable David O. Carter, Judge
Julie Barrera Not Present Courtroom Clerk Court Reporter
ATTORNEYS PRESENT FOR PLAINTIFFS: ATTORNEYS PRESENT FOR DEFENDANTS:
NONE PRESENT NONE PRESENT
PROCEEDING (IN CHAMBERS): ORDER (1) DENYING DEFENDANT'S MOTION TO STAY EXECUTION OF JUDGMENT PENDING APPEAL AND (2) GRANTING PLAINTIFF'S MOTION TO PERMIT REGISTRATION OF JUDGMENT IN ANOTHER DISTRICT
Before the Court is (1) Defendant Aimee Sabolyk's ("Sabolyk" or "Defendant") motion to stay execution of judgment pending appeal (Dkt. 248) and (2) Plaintiff StrikePoint Trading, LLC's ("StrikePoint" or "Plaintiff") motion to permit registration of judgment in another district pursuant to 28 U.S.C. § 1963 (Dkt. 247).
The Court finds these matters appropriate for decision without oral argument. Fed. R. Civ. P. 78; L.R. 7-15. Accordingly, these matters are REMOVED from the Court's January 23, 2012 calendar. After considering the moving, opposing, and replying papers thereon, and for the reasons stated below, the Court hereby DENIES Defendant's motion and GRANTS Plaintiff's motion.
StrikePoint is a commodity futures and options brokerage firm located in Mission Viejo, California. Defendant Sabolyk is a former employee of StrikePoint. Sabolyk left StrikePoint and began working for Defendant Global Asset Advisors ("GAA"). GAA is a commodities and futures brokerage company in Chicago, Illinois. StrikePoint filed suit against Sabolyk and GAA alleging misappropriation of trade secrets and breach of contract, based on Defendants' alleged use of proprietary StrikePoint client information, as well as other claims not relevant to these motions. After the Court granted in part and denied in part Defendants' motion for summary judgment, the remaining claims proceeded to trial. On March 16, 2009, the jury returned its verdict, finding for StrikePoint on both the misappropriation of trade secrets claim and the breach of contract claim. The jury based its verdict on findings that StrikePoint owned the client list at issue, and the list was a trade secret. The jury found that Sabolyk solicited clients from the client list and that Sabolyk and GAA misappropriated the client list. The jury found harm to StrikePoint under both claims and awarded damages on only the breach of contract claim. The damages award consists of $93,000 in lost profits and $9,300 in future
On August 18, 2009, the Court entered a permanent injunction, ordering Sabolyk and GAA to refrain from soliciting or contacting any clients of StrikePoint, who Defendants became aware of as a result of Sabolyk's employment with StrikePoint, for the purpose of getting the clients to transfer their accounts away from StrikePoint (Dkt. 193). The injunction expired one year later.
Defendants appealed the permanent injunction, but by the time oral argument was held, the injunction had expired and the issue was moot. Upon conclusion of the appeal, the Court entered judgment in favor of StrikePoint on August 29, 2011. On September 28, 2011, Sabolyk appealed the Court's entry of judgment. On October 26, 2011, Sabolyk filed an untimely motion for judgment as a matter of law or a new trial, which the Court denied on November 21, 2011. Strikepoint now seeks to register its judgment in Illinois, where it argues Sabolyk has assets. At the same time, Sabolyk seeks to stay execution of the judgment pending her latest appeal.
Under Federal Rule of Civil Procedure 62(d), an appealing party may obtain a stay of execution of the judgment entered against it upon posting a supersedeas bond. Fed. R. Civ. P. 62(d). "District courts have inherent discretionary authority in setting supersedeas bonds[.]" Rachel v. Banana Republic, Inc., 831 F.2d 1503, 1505 n.1 (9th Cir. 1987). District courts also have the discretion to stay execution of the judgment without requiring a supersedeas bond. Acacia Research Corp. v. Nat'l Union Fire Ins. Co., No. 05-501, 2008 WL 4381649, at *2 (C.D. Cal. Sept. 9, 2008). Before waiving the bond requirement, a court should consider the purpose of requiring a judgment debtor to post a bond, which is "to ensure that the judgment creditor's interests are adequately protected during the appeals process." FTC v. Inc21.com Corp., No. C 10-00022 WHA, 2010 WL 4071664, at *7 (N.D. Cal. Oct. 18, 2010). The judgment debtor must "objectively demonstrate" the reasons the Court should "depart from the usual requirement of a full security supersedeas bond to suspend the operation of an unconditional money judgment." Poplar Grove Planting and Refining Co., Inc. v. Bache Halsey Stuart, 600 F.2d 1189, 1191 (5th Cir. 1979).
Sabolyk argues that she cannot afford to pay her mortgage, impending law school loans, and living expenses if execution of the judgment is not stayed. She also claims she does not have any assets which may be used to satisfy StrikePoint's judgment because her income is not enough to cover her expenses as well as pay wage garnishment toward satisfaction of the judgment. Sabolyk argues if the judgment is executed, she will be ...