Mendel et al v. Morgan Keegan & Company Inc

Filing 52

MEMORANDUM OPINION AND ORDER The court FIXES a supersedeas bond in the amount of $200,000 which, if approved as to form and as to the corporate surety, shall be posted by Morgan Keegan within 14 days, after which the judgment will be stayed by separate order. Signed by Judge William M Acker, Jr on 6/26/15. (SAC )

FILED
2015 Jun-30 PM 02:42
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
JAKE MENDEL, etc., et al.,
Plaintiffs,
v.
MORGAN KEEGAN & COMPANY,
INC.,
Defendant.

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CIVIL ACTION NO.
13-AR-1630-S

MEMORANDUM OPINION AND ORDER
On June 25, 2015, the court heard oral argument on the motion
by appellant Morgan Keegan for a stay of the judgment pending the
appeal.
As this court reads Federal Rule of Civil Procedure 62(d), the
means by which an appellant can obtain a stay of the enforcement of
a judgment is by the posting of a supersedeas bond designed to
protect the appellee from the harm he may sustain if the appeal is
unsuccessful. The usual case that calls for a supersedeas bond is
an appeal from a money judgment, in which a surety bond for the
amount of the judgment, plus interest, and the costs of defending
the appeal would be posted, even if the judgment defendant is a
giant corporation with assets far exceeding the amount of the
judgment. That is not this case. The judgment in this case orders
that the underlying controversy between the parties be

arbitrated

in a proceeding in which the Mendel Parties might recover millions
of dollars or nothing. Rule 62(d) was not tailored for this

situation.
Morgan Keegan insists that its prospects for victory on appeal
are so good that it should not be required to post a bond at all.
With this contention the court respectfully disagrees, but declines
to engage in extended debate on the subject.
The problem for the court, then, is to quantify in some
reasonable way the harm that Mendel Parties might suffer in the
event

this

court

is

affirmed

and

the

controversy

goes

to

arbitration. As the court exercises its considerable discretion in
the

premises,

there

are

several

imponderables

that

must

be

considered. The theory of supersedeas assumes that without a bond
the obligor under the judgment might not be able to comply if it
loses its appeal. There is no evidence in this case of the net
worth of Morgan Keegan, or whether it will be in business after its
appeal, or that it will be prepared to engage in an expensive and
lengthy arbitration proceedings and pay the multimillion dollar
award that Mendel Parties think they are entitled to. It is a sure
thing that Morgan Keegan’s pending appeal will be pending for a
long

time, during which witnesses and evidence for an arbitration

proceeding may be lost. Mendel Parties’ cost of defending the
appeal will also be sizeable.
Taken together, the court hereby FIXES a supersedeas bond in
the amount of $200,000 which, if approved as to form and as to the
corporate surety, shall be posted by Morgan Keegan within 14 days,

2

after which the judgment will be stayed by separate order.

DONE this 26th day of June, 2015.

_____________________________
WILLIAM M. ACKER, JR.
UNITED STATES DISTRICT JUDGE

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