United States District Court, S.D. California
ORDER REQUIRING DEFENDANTS TO OBTAIN AND POST
Larry Alan Burns Chief United States District Judge.
Plaintiff prevailed at trial, Defendants filed a motion under
Fed.R.Civ.P. 60, and also asked the Court to stay judgment.
They offered to post a supersedeas bond for the entire amount
of the judgment. The purpose of the bond was to ensure that
even if final judgment were delayed, Plaintiff would be able
to recover what he had been awarded. Court cautioned that if
Defendants did not fulfill their part in this, the Court
would lift the temporary stay. (See Docket no. 188
the Court extended the time for Defendants to post a bond,
they obtained a bond issued by Atlantic Specialty Insurance
Company. Plaintiff timely objected to the bond, however, as
failing to cover the entire amount of the judgment, and asked
the Court to either require the posting of a new bond, or to
construe the bond so that Plaintiff would receive the full
amount of any ultimate award. (Docket no. 193.) Defendants
filed no opposition, thereby consenting to the request's
being granted. The Court granted the alternate request
and construed the bond so as to provide that Plaintiff would
be paid the full amount of any judgment that survived
following appeal. Even if the award were reduced, or one or
two of the Defendants were held not fully liable, Plaintiff
would still be paid what he was entitled to. This
construction, in the Court's view, was the most generous
interpretation of Defendants' and Atlantic
Specialty's actions, and would save money and effort.
Court required that Atlantic Specialty be notified, and gave
both it and any other party the opportunity to file an
objection to the Court's construction of the bond. The
order the Court issued construing the bond was Atlantic
Specialty's and Defendants' first notice of the
Court's understanding of the bond's coverage, and
their opportunity to correct any misapprehension. Because
Atlantic Specialty was not a party to this action and was
affected by the Court's order, this was its first
opportunity to explain what it thought the bond covered.
Specialty filed a more limited objection making clear it did
not agree with the Court's construction. Defendants,
however, filed a lengthy brief that amounts to an
unauthorized and unnecessary motion for reconsideration.
See Standing Order in Civil Cases, ¶ 3(e). The
motion sidesteps the Court's award of damages jointly and
severally, see Docket no. 177 at 17:23-26, and makes
several other misplaced arguments. The only portion of their
brief that complies with the Court's order are the
arguments that duplicate Atlantic Specialty's.
Specialty's response makes clear that, as Atlantic
Specialty understands it, the bond Defendants obtained and
posted would only cover the ful amount of the judgment if
Plaintiff prevails in full on appeal. If an appeal is even
partially successful for any reason, the bond covers nothing.
For example, if Hitco Inc. were found not liable for Hitco,
Ltd.'s actions, the bond would be worthless and would not
cover any award against Theodore Smith, even if the judgment
against him is affirmed entirely.
Court accepts Atlantic Specialty's and Defendants'
concession that the bond provides only narrow coverage, and
construes it as urged by Atlantic Specialty. The bond
therefore does not comply with the Court's order
requiring the posting of a bond covering the entire judgment
and guaranteeing that Plaintiff will recover whatever he is
awarded. A bond that would leave Plaintiff potentially unable
to collect is unacceptable. Defendants' motion for
reconsideration is DENIED as moot.
14 calendar days of the date this order is
issued, Defendants must post an acceptable bond
covering the entire award, as previously ordered, and must
file a notice stating that they have filed one. If Defendants
need more time they should first attempt to resolve the
matter with Plaintiff before seeking an extension.
were previously cautioned that the onus is on them to justify
a continued stay. If they do not obey the Court's order,
the stay will be lifted without further notice to them.
IS SO ORDERED.
See Civil Local Rule
7.1(f)(3)(a) (requiring a party who opposes any request for
ruling by the Court to file a written opposition). See
also Standing Order in Civil Cases, ¶ 5 (providing
that ex parte applications and administrative
requests to which no ...