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Sabre GLBL, Inc. v. Shan

United States District Court, D. New Jersey

September 12, 2018

SABRE GLBL, INC, Plaintiff,
v.
MELODY SHAN, also known as SHAN MELODY XIAOYUN, Defendant.

          OPINION

          WILLIAM J. MARTINI, U.S.D.J.

         This matter comes before the Court on Defendant Melody Shan's motion to stay enforcement of this Court's April 23, 2018 Opinion and and to waive the bond requirement of Federal Rule of Civil Procedure 62(d). ECF No. 29. For the reasons set forth below, Defendant Shan's motion is DENIED.

         I. RELEVANT FACTS AND PROCEDURAL HISTORY[1]

         Plaintiff Sabre GLBL, Inc. (“Plaintiff”) originally brought this action in New Jersey Superior Court against Melody Shan (“Defendant”). Defendant removed the case to this Court and moved to compel arbitration (the “Arbitration”). ECF No. 2. The Court granted Defendant's motion on April 6, 2017. ECF Nos. 6-7.

         Arbitrator Mark Whittington (the “Arbitrator”) conducted the Arbitration between September 25 and September 27, 2017. The Arbitrator issued an interim award on January 6, 2018, and a final award on February 12, 2018 (the “Award”), enjoining Defendant from competing with Plaintiff and awarding damages totaling $1, 823, 318.00.

         Between the interim and final awards, Plaintiff learned that just before the Arbitration began, Defendant transferred her equity in her family home to her husband in exchange for de minimis consideration. According to Plaintiff, this was a deliberate attempt to hinder its ability to collect on the impending Award. To unwind the transfer, Plaintiff filed a second suit in this Court against Defendant Shan and her husband. See Complaint, Sabre v. Shan, 2:18-cv-00728-WJM-MF (D.N.J. Jan. 17, 2018), ECF No. 1. On March 23, 2018, Defendant's husband transferred a 50% interest in the home back to Defendant. Defendant and her husband eventually consented to the entry of a permanent injunction preventing them “from encumbering the Property until such time that Defendant Shan has paid to Sabre all amounts owed.” Permanent Injunction, Sabre v. Shan, 2:18-cv-00728-WJM-MF (D.N.J. Aug. 29, 2018), ECF No. 21.

         In early 2018, Plaintiff moved this Court to confirm the Award, while Defendant moved for vacatur. ECF Nos. 10, 11, 18, 20. On April 23, 2018, the Court granted in part and denied in part the cross-motions, setting aside the Arbitrator's award of attorney's fees and thus reducing total damages to $1, 373, 318. ECF No. 24. Defendant filed her Notice of Appeal on May 1, 2018. ECF No. 30.

         On May 2, Defendant filed her Motion to Stay Enforcement and for Waiver of the Supersedeas Bond Requirement under Rule 62(d) (the “Motion”). ECF No. 29. Attached to the Motion was a sworn declaration by Defendant outlining her assets. Shan Decl. ¶ 1 (May 2, 2018), ECF No. 29.3. Defendant also stipulated that she would not sell her house or car during the pendency of the appeal. Id. ¶ 2. In her Motion, Defendant proffered this stipulation as an adequate alternative to the regular bond requirement of Rule 62(d). Def. Motion at 8, ECF No. 29. Defendant noted she “simply does not have the assets” to obtain a bond and the assets she does have “do not remotely approach” the amount required. Id. at 9.

         II. DISCUSSION

         Judgment debtors that appeal a trial court's decision may move to stay a monetary judgment under Federal Rule of Civil Procedure 62(d). Under Rule 62, “[i]f an appeal is taken, the appellant may obtain a stay by supersedeas bond.” A supersedeas bond is any form of security from which the other party may be made whole if the appeal is unsuccessful, whether in the form of cash, property, or surety bond. Hilburn v. Bayonne Parking Auth., No. 07-5211, 2013 WL 1721648, at *2 (D.N.J. Apr. 19, 2013) (“Hilburn II”). To be sufficient to make the appellee whole, the “bond must normally be in a sum sufficient to pay the judgment and costs, interest, and damages for delay.” Id. Subject to certain exceptions not relevant here, appellants are entitled to a stay once the court approves the bond. See Fed. R. Civ. P. 62(d).

         District courts “have discretion under Rule 62(d) to waive the bond requirement in whole or in part.” United States ex rel. Doe v. Heart Sol. PC, No. CV143644SRCCLW, 2017 WL 2709561, at *1 (D.N.J. June 23, 2017). However, such discretion should only be exercised in exceptional circumstances and where alternative means of securing the judgment exist. Hilburn v. New Jersey Dep't of Corr., Civ. No. 7-6064, 2012 WL 3133890, at *29 (D.N.J. July 31, 2012) (“Hilburn I”).

         To determine whether extraordinary circumstances exist, courts in this district generally consider the following factors (the “Dillon factors”):

1. The complexity of the collection process;
2. The amount of time required to obtain a judgment after it is ...

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