Opinion
NO. CIV. 2:10-2751 WBS GGH NO. CIV. 2:10-2846 WBS GGH NO. CIV. 2:11-2497 WBS GGH
11-15-2012
CENTURY 21 REAL ESTATE LLC, a Delaware Limited Liability Company formerly known as Century 21 Real Estate Corporation, Plaintiff, v. ALL PROFESSIONAL REALTY, INC., a California corporation doing business as CENTURY 21 ALL PROFESSIONAL; STEVEN M. WRIGHT, an individual; and CAROL WRIGHT, an individual, Defendants.
ORDER RE: MOTION TO STAY PENDING APPEAL
Defendants Steven and Carol Wright ("the Wrights"), now proceeding pro se, move for a stay pending appeal of this court's August 8, 2012 Order granting summary adjudication in favor of plaintiff Century 21 Real Estate LLC ("Century 21") on its breach of contract and trademark claims against the Wrights and All Professional Realty ("All Professional"). The judgment from which they appeal includes an injunction and an award of monetary damages which, with attorney's fees, totals over one million dollars plus interest. (Docket Nos. 118, 131.)
With regard to the judgment for monetary damages, with a few specified exceptions not applicable here, Federal Rule of Civil Procedure 62(a) provides for an automatic stay of fourteen days following entry of a judgment. Fed. R. Civ. P. 62(a). A party appealing a district court's entry of a monetary judgment is entitled to a further stay as a matter of right if he posts a bond in accordance with Federal Rule of Civil Procedure 62(d), Antoninetti v. Chipotle Mexican Grill, Inc., Civ. No. 05-1660, 2009 WL 1390811, at *2 (S.D. Cal. May 15, 2009) (citing Am. Mfrs. Mut. Ins. Co. v. Am. Broad.-Paramount Theatres, Inc., 87 S. Ct. 1, 3 (1966)), or he may move for a stay of execution without a bond, Fed. R. App. P. 8(a)-(b).
While parties have the right to a stay obtained through a supersedeas bond, an unsecured stay is reserved for "unusual circumstances" and awarded at the court's discretion. Fed. Prescription Serv., Inc. v. Am. Pharm. Ass'n, 636 F.2d 755, 760-61 (D.C. Cir. 1980). "Courts addressing a motion for an unsecured stay under Rule 62(d) have expressed a willingness to grant such requests when: (1) 'defendant's ability to pay is so plain that the cost of the bond would be a waste of money' or (2) 'the requirement would put the defendant's other creditors in undue jeopardy' (in other words, the requirement is impracticable because it would, for example, force appellant into bankruptcy or paralyze the business)." Bolt, 2005 WL 2298423 at *3 (citing cases) (Shubb, J.). Under either approach, the burden is on the appellant to demonstrate the reasons for "depart[ing] from the usual requirement of a full security supersedeas bond." Poplar Grove Planting & Refining Co. v. Bache Halsey Stuart, Inc., 600 F.2d 1189, 1190 (5th Cir. 1979); C.B. v. Sonora Sch. Dist., 819 F. Supp. 2d 1032, 1054 (E.D. Cal. 2011).
Even if an appellant persuades the court that a full bond is unnecessary, the court typically requires a substitute form of judgment guarantee. See Olympia Equip. Leasing Co. v. W. Union Tel. Co., 786 F.2d 794, 796 (7th Cir. 1986) (noting that both defendants with a clear ability to pay and those who would be bankrupted by a bond requirement are "candidate[s] for alternative security"); SIBIA Neurosciences, Inc., v. Cadus Pharm. Corp., Civ. No. 96-1231 IEG POR, 1999 WL 33554683, at *4 (S.D. Cal. Mar. 10, 1999) (conditionally granting use of an escrow account in place of a bond).
Here, the Wrights have not shown that they have posted a bond to secure the judgment against them. Their ability to pay is not plain in the least, and they do not present evidence that obtaining a bond would bankrupt them. Thus, they have not met their burden to demonstrate valid reason for departing from the requirement of a full supersedeas bond. Furthermore, the Wrights have not put forth an alternative to the bond. See Bolt v. Merrimack Pharm., Inc., Civ. No. 04-0893 WBS DAD, 2005 WL 2298423, at *4 (E.D. Cal. Sept. 20, 2005) ("[B]ecause defendant bears the burden of formulating an alternative plan, the court will not imagine one of its own.").
The Wrights may seek the court's approval of a bond in the full amount of the Judgment. However, since the facts presented to the court do not indicate that the Wrights have posted a supersedeas bond or qualify for an exception to the bond requirement, the Wrights have not satisfied the requirements for a stay under Rule 62(d).
With regard to the injunction, Federal Rule of Civil Procedure 62(c) provides that "[w]hile an appeal is pending from an interlocutory order or final judgment that grants, dissolves, or denies an injunction, the court may suspend, modify, restore, or grant an injunction on terms for bond or other terms that secure the opposing party's rights." Fed. R. Civ. P. 62(c).
Under Rule 62(c), a court must consider: (1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies. Golden Gate Rest. Ass'n v. City & Cnty. of S.F., 512 F.3d 1112, 1115 (9th Cir. 2008) (quoting Hilton v. Braunskill, 481 U.S. at 776) (internal quotation marks omitted).
The court has previously addressed these factors in denying the plaintiffs' request to stay or modify the preliminary injunction pending appeal. (Docket No. 41). For the same reasons here, the Wrights provide only a minimal probability of success on their pending appeal; Century 21 will be irreparably harmed if the court stays the injunction against the Wright's unauthorized use of the trademark; and the public interest weighs heavily against granting a stay because the public interest in the trademark context is the right of the public not to be deceived or confused. See Internet Specialties W., Inc. v. Milon-DiGiorgio Enters., Inc., 559 F.3d 985, 993-94 (9th Cir. 2009). Thus, since the balance of the Hilton factors weighs against a stay, the court will deny the Wright's motion for a stay of the injunctive award against them.
Accordingly, because the Wrights fail to satisfy the requirements for a stay under either Federal Rule of Civil Procedure 62(d) or (c), the court will deny the Wrights' motion for a stay pending appeal.
IT IS THEREFORE ORDERED, that Steven and Carol Wright's motion to stay pending appeal be, and the same hereby is, DENIED.
The Wrights' Motion to Extend Time to File Amended Motion to Stay Pending Appeal, filed November 14, 2012 (Docket No. 140) is denied.
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WILLIAM B. SHUBB
UNITED STATES DISTRICT JUDGE