United States District Court, N.D. California
ORDER DENYING FAIRCHILD'S MOTION FOR WAIVER OF
SUPERSEDEAS BOND; SETTING BOND AMOUNT; EXTENDING TEMPORARY
STAY Re Dkt. No. 1041
M.CHESNEY UNITED STATES DISTRICT JUDGE
the Court is defendants Fairchild Semiconductor
International, Inc., Fairchild Semiconductor Corporation, and
Fairchild (Taiwan) Corporation's (collectively
“Fairchild”) “Motion for Order Staying
Execution of Judgment and Waiver of Requirement to Post
Supersedeas Bond.” The matter came on regularly for
hearing on May 5, 2017. Frank E. Scherkenbach, Howard G.
Pollack, and Michael R. Headley of Fish & Richardson P.C.
appeared on behalf of plaintiff Power Integrations, Inc.
(“Power Integrations”). Blair M. Jacobs and
Christina A. Ondrick of Paul Hastings LLP appeared on behalf
of Fairchild. The Court, having considered the papers filed
by the parties, as well as the arguments of counsel at the
hearing, rules as follows.
parties are familiar with the procedural background of the
above-titled action. As relevant to the instant motion, the
Court, on March 10, 2017, entered final judgment in favor of
Power Integrations and against Fairchild in the total amount
of $146, 480, 598. On March 27, 2017, Fairchild filed a
notice of appeal.
instant motion, Fairchild asks the Court to stay enforcement
of the judgment pending appeal, pursuant to Rule 62(d) of the
Federal Rules of Civil Procedure, and further asks the Court
to waive Rule 62(d)'s typical requirement of a
supersedeas bond. By order filed March 29, 2017, the Court
temporarily stayed execution of the judgment pending its
ruling on the instant motion
provides for the circumstances under which a court may
“stay the execution of a judgment.” Fed.R.Civ.P.
62(b). Under Rule 62(d), “[i]f an appeal is taken, the
appellant may obtain a stay by supersedeas
bond.” Fed.R.Civ.P. 62(d). “The stay takes
effect when the court approves the bond.” Id.
Such bond “protects the prevailing plaintiff from the
risk of a later uncollectible judgment and compensates him
for delay in entry of the final judgment.” See
N.L.R.B. v. Westphal, 859 F.2d 818, 819 (9th Cir. 1988).
courts have inherent discretionary authority in setting
supersedeas bonds.” Rachel v. Banana Republic,
Inc., 831 F.3d 1503, 1505. n.1 (9th Cir. 1987).
“This includes the discretion to allow other forms of
judgment guarantee, and broad discretionary power to waive
the bond requirement if it sees fit.” Cotton ex
rel. McClure v. City of Eureka, Cal., 860 F.Supp.2d 999,
1027 (N.D. Cal. 2012) (internal quotation and citation
determining whether to waive the bond requirement, courts
have considered the following factors: “(1) the
complexity of the collection process; (2) the amount of time
required to obtain a judgment after it is affirmed on appeal;
(3) the degree of confidence that the district court has in
the availability of funds to pay the judgment; (4) whether
the defendant's ability to pay the judgment is so plain
that the cost of a bond would be a waste of money; and (5)
whether the defendant is in such a precarious financial
condition that the requirement to post a bond would place
other creditors of the defendant in an insecure
position.” See Dillon v. City of Chicago, 866
F.2d 902, 904-05 (7th Cir. 1988) (internal quotation and
citation omitted); see also Kranson v. Fed. Express
Corp., 11-cv-05826-YGR, 2013 WL 6872495, at *1 (N.D.
Cal. Dec. 31, 2013) (noting “[c]ourts in the Ninth
Circuit regularly use the Dillon factors in
determining whether to waive the bond requirement”).
The appellant “has the burden to objectively
demonstrate the reasons for departing from the usual
requirement of a full supersedeas bond.”
Cotton, 860 F.Supp.2d at 1028 (internal quotation
and citation omitted).
noted, Fairchild asks the Court to stay enforcement of the
instant judgment pending Fairchild's appeal and without
requiring it to post a supersedeas bond. Should the Court
find such bond is required, Fairchild asks the Court to set
the amount of the bond at 25% of the full judgment amount and
to extend the temporary stay currently in place.
Waiver of Supersedeas Bond
support of its request that the Court waive the bond
requirement, Fairchild has submitted evidence as to the
financial condition of its parent corporation, ON
Semiconductor Corporation (“ON”),  and argues
Fairchild and ON “are fully able to satisfy the
judgment amount and are in no danger of default or
bankruptcy.” (Mot. at 1:18-20.) As Power Integrations
points out, however, ON itself has not made an express
commitment to satisfy the judgment on behalf of Fairchild.
Without such commitment, and given the absence of information
as to Fairchild's own financial status, waiver of the
supersedeas bond would not be appropriate. See
Cotton, 860 F.Supp.2d at 1028 (“Until there is
absolute certainty that the entity has agreed unconditionally
to pay the judgment in [the] case, the mere existence of such
possibility is an unacceptable substitute for the guarantees
provided by a supersedeas bond.”) (internal quotation,
citation, and alteration omitted).
hearing, Fairchild represented that it could provide to the
Court and to Power Integrations a commitment from ON that ON
will satisfy the judgment within 30 days of the resolution of
the appeal of the instant action. Although, to date, that
commitment is not reflected in the docket, the Court, for
purposes of ...