United States District Court, N.D. California
ORDER CERTIFYING JUDGMENT AS TO TNF GEAR AND KL SPORT
FOR REGISTRATION IN ANOTHER DISTRICT RE: DKT. NO.
JACQUELINE SCOTT CORLEY UNITED STATES MAGISTRATE JUDGE
and Linda Vinci and TNF Gear, Inc., a Vermont corporation of
which the Vincis are the sole shareholders, filed this civil
action against VF Outdoor, LLC, which operates a division
under the brand name “North Face.” VF Outdoor
filed counterclaims against the Vincis and KL Sport Inc., TNF
Gear's predecessor. The claims and counterclaims arose
out of a business arrangement between the parties wherein TNF
Gear acted as a reseller of The North Face merchandise.
2019, the Court granted VF Outdoor's motion for summary
judgment and entered judgment in its favor on its breach of
contract counterclaims. (Dkt. No. 98.) The Vincis and TNF
Gear thereafter filed a notice of appeal and VF Outdoor filed
the underlying motion to certify the judgment for
registration for enforcement in another district. (Dkt. Nos.
103 & 109.) After the motion was filed, the Vincis filed
a suggestion of bankruptcy indicating that they had filed a
voluntary petition for relief under Chapter 7. (Dkt. No.
111.) The Court issued an order staying proceedings as to the
Vincis under 11 U.S.C. § 362(a)(1) and ordering
Plaintiffs to file a further statement if they contended that
the bankruptcy stay extended to TNF Gear and KL Sport. (Dkt.
No. 112.) Plaintiffs did not file anything further and did
not oppose the underlying motion.
VF Outdoor's motion was based on the contention that the
Vincis have substantial assets in Vermont and proceedings as
to the Vincis are stayed under Section 362(a)(1), the Court
requested supplemental briefing regarding whether there was
nonetheless good cause to grant the motion as to TNF Gear
(and its predecessor KL Sport) given that VF Outdoor attests
that neither has any assets from which it could collect.
(Dkt. No. 113.) The Court has considered VF Outdoor's
supplemental briefing, finds that there is good cause, and
GRANTS the motion to certify the Court's judgment for
registration for enforcement in another district under 28
U.S.C. § 1963.
a judgment becomes final and enforceable ten days after
judgment is entered. Fed.R.Civ.P. 62(a). At that time, a
prevailing party is entitled to execute upon a judgment.
See Columbia Pictures Television, Inc. v. Krypton Broad.
of Birmingham, Inc., 259 F.3d 1186, 1197 (9th Cir.
2001). Where a party has filed an appeal, the judgment is
only enforceable in the district in which it was rendered,
unless the judgment is “registered” in another
district by court order. Id. (citing 28 U.S.C.
§ 1963). The process for registering a judgment is set
forth in 28 U.S.C. § 1963:
A judgment in an action for the recovery of money or property
entered in any [ ] district court ... may be registered by
filing a certified copy of the judgment in any other district
[ ], ... when the judgment has become final by appeal or
expiration of the time for appeal or when ordered by the
court that entered the judgment for good cause shown .... A
judgment so registered shall have the same effect as a
judgment of the district court of the district where
registered and may be enforced in like manner.
Id. “Section 1963 thus permits a district
court to issue an order certifying a judgment for
registration during the pendency of an appeal upon a finding
of ‘good cause.'” Columbia Pictures,
259 F.3d at 1197 (quoting 28 U.S.C. § 1963).
good cause standard is not defined in the statute, but in
Columbia Pictures the Ninth Circuit adopted the
following standard: “an absence of assets in the
judgment forum, coupled with the presence of substantial
assets in the registration forum” constitutes good
cause. Columbia Pictures, 259 F.3d at 1197-98. Here,
there is no suggestion that any Plaintiffs have assets in
California. (Dkt. No. 109-1 at ¶¶ 11-13.) Thus, the
first factor of the good cause standard is easily met.
respect to the second factor, VF Outdoor contends that the
Vincis have substantial assets in Vermont where it seeks to
register the judgment, but concedes that the Court cannot
certify the judgment as to them given the bankruptcy stay. VF
Outdoor nonetheless insists “‘the distinct
possibility of [a judgment creditor] being faced with an
unsatisfied judgment' sufficiently satisfies the
‘good cause' threshold.” See UMG
Recordings, Inc. v. BCD Music Grp., Inc., No. CV
07-05808 SJO (FFMx), 2012 WL 12882702, at *3 (CD. Cal. Oct.
3, 2012) (quoting Associated Bus. Tel. Sys. Corp. v.
Greater Capital Corp., 128 F.R.D. 63, 66-67 (D. N.J.
1989)); see also In re Reddy, 589 B.R. 867, 873
(Bankr. E.D. Cal. 2018) (“the possibility that the
plaintiff will have an unsatisfied judgment if not allowed to
register in other districts before or pending appeal
ordinarily suffices as ‘good cause.'”).
Further, VF Outdoor emphasizes that while TNF Gear's tax
returns indicate that it did not have any assets as of the
end of 2017, TNF Gear has continued to pursue the appeal of
this court's judgment (through counsel) following the
Vincis' personal bankruptcy filing. As Vermont
corporations with their principal places of business in
Vermont and sole shareholders in Vermont, TNF Gear and KL
Sports assets, if any, would most likely be in Vermont. (Dkt.
No. 114-1 at ¶¶ 7-8.)
that VF Outdoor is unlikely to be able to collect on the
judgment here, the Court finds that VF Outdoor has
demonstrated good cause under 28 U.S.C. § 1963 for
allowing it to register the judgment against TNF Gear and its
predecessor KL Sport in the District of Vermont. The motion
Order disposes of Docket No. 109.