Jones v. Riot Hospitality Group LLC et al

Filing 504

**Amended by Order (Doc. 505 )** ORDER denying 495 Motion to Quash. Plaintiff and Mr. Nathanson shall post a supersedeas bond in the form of a cashier's check made payable to the Clerk of United States District Court in the amount of $83,490.60 no later than 5:00 p.m. on 5/31/23. A stay of the judgment for the amount due will be in effect upon their posting of the bond with the Clerk of Court. Signed by Chief Judge G Murray Snow on 5/23/23. (DXD) Modified on 5/23/2023 (DXD).

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Alyssa Jones,

No. CV-17-04612-PHX-GMS
Plaintiff,

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ORDER

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v.

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Riot Hospitality Group LLC, et al.,

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Defendants.

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Pending before the Court is Plaintiff Alyssa Jones’s Motion to Quash Rule 45
Discovery. For the reasons below, the motion is denied.
BACKGROUND

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Plaintiff filed this lawsuit in 2017. On March 2, 2021, the Court found Plaintiff and

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her counsel, Mr. Philip Nathanson, jointly and severally liable for fees and costs that

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Defendants incurred while pursuing Plaintiff’s compliance with the Court’s discovery

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orders. (Doc. 413.) Specifically, Plaintiff “intentionally deleted an unknowable number

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of messages between herself and her witnesses from the outset of the case through mid-

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2020,” (Doc. 485 at 22), and Mr. Nathanson refused to produce relevant evidence, (Doc.

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413 at 2). Because of these egregious discovery violations, the Court sanctioned Plaintiff

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and Mr. Nathanson and gave Defendants 21 days to submit documentation in compliance

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with Local Rule of Civil Procedure 54.2.

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documentation on March 23, 2021. (Doc. 415.) On August 9, 2021, the Court awarded

(Doc. 413.)

Defendants submitted this

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the following fees and costs:

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1. Plaintiff Alyssa Jones and Mr. Nathanson are jointly and severally liable
for $21,855.50 for Defendants’ fees and costs incurred pursuing
Plaintiff’s compliance with the Court’s orders between March 25, 2020,
and August 17, 2020.

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2. Mr. Nathanson is liable for $12,011.00 for fees and costs incurred
pursuing Plaintiff’s compliance with the Court’s orders between
December 11, 2020 and the date of this Order.

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3. Plaintiff is liable for $35,709.00 for the costs and fees of expert K.J.
Kuchta

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(Doc. 433.)

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These amounts were to be paid within 90 days of that Order. (Doc. 433.) On August

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25, 2022, the Court issued a final judgment dismissing Plaintiff’s complaint because of her

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egregious discovery violations and awarded various sanctions against them. (Doc. 485.)

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This Order noted that the judgment for fees and costs was final. Id. at 26–7 (ordering that

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“t]he outstanding award of fees and costs is hereby final and may be enforced through

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appropriate process.”)

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Nevertheless, the Defendants failed to pay the costs and fees within 90 days of the

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Court’s order on August 6, 2021. So, on November 17, 2022, Defendants served Plaintiff

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and Mr. Nathanson subpoenas seeking financial documents and information to secure

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payment. In response, Defendants filed the current motion to quash, alleging that they are

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not judgment debtors and that the requested information contains information that is

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subject to attorney-client privilege. Alternatively, they ask the Court “for the setting of the

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amount of a supersedeas bond and the timing of posting said bond” pursuant to Federal

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Rule of Civil Procedure 62(b). (Doc. 495 at 3.)
DISCUSSION

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I.

Motion to Quash

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A. Legal Standard

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“On timely motion, the court for the district where compliance is required must

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quash or modify a subpoena that: (i) fails to allow a reasonable time to comply; (ii) requires

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a person to comply beyond the geographical limits specified in Rule 45(c); (iii) requires

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disclosure of privileged or other protected matter, if no exception or waiver applies; or

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(iv) subjects a person to undue burden.” Fed. R. Civ. P. 45 (3)(A). Plaintiff’s motion to

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quash is denied, however, because she and Mr. Nathanson are judgment debtors, and she

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has not established that the information Defendants seek is privileged.

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B. Analysis

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As an initial matter, Plaintiff fails to explain how her argument that she and her

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attorney are not “judgment debtors” relates to any specific basis for granting a motion to

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quash. However, her argument fails under any of the bases identified in Rule 45 because

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she and Mr. Nathanson are “judgment debtors,” and a money judgment has been entered

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against them. The Court granted Defendant’s motion for the costs and fees at issue and

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ordered Plaintiff and Mr. Nathanson to pay them within 90 days of its August 6, 2021

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Order. (Doc. 433 at 8.) Still, Plaintiff suggests that “[t]he only judgment entered in this

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case by the Clerk under the separate document rule for judgments” did not award the cost

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and fees currently at issue. (Doc. 495 at 2 (citing Fed. R. Civ. P. 58).)

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This argument fails under the plain text of Rule 58(a)(3), which states that “[e]very

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judgment . . . must be set out in a separate document, but a separate document is not

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required for an order disposing of a motion . . . for attorney’s fees under Rule 54 . . . .”

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When the Court awarded the costs and fees at issue, it awarded them pursuant to a Rule 54

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motion. (Doc. 433 at 2, 8.) Thus, no separate document was needed to render that award

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final, and Plaintiff and Mr. Nathanson were compelled to pay those fees within 90 days of

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the Court’s August 6, 2021 Order.

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Plaintiff’s cited authority is not to the contrary. In Envy Hawaii LLC v. Cirbin Inc.,

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the court denied a motion to hold a party in contempt of court for failing to pay an amount

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it owed under a settlement agreement. No. CV 16-00551 ACK-RLP, 2018 WL 1004875,

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at *1 (D. Haw. Feb. 5, 2018). There, the Court noted that “Plaintiff did not request that

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judgment be entered following the court's order.” Id. at *2. However, unlike a Rule 54

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award of attorneys’ fees, amounts due under settlement agreements must be set out in a

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separate document to be considered “final” judgments. See Fed. R. Civ. P. 58(d). Thus,

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nothing in Envy suggests that there is no money judgment to enforce in this case.

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Further, none of the requested materials are privileged under Arizona law because

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they are not communications. See A.R.S. § 12–2234 (“[I]n a civil action an attorney shall

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not, without the consent of his client, be examined as to any communication made by the

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client to him, or his advice given thereon in the course of professional employment.”); see

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also Samaritan Found. v. Goodfarb, 176 Ariz. 497, 501 (1993). Plaintiff provides no

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support for her contention that “the files of clients that actually belong to the clients, not

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the attorney” are privileged materials under Arizona law. (Doc. 495 at 3.)
Thus, Plaintiff’s Motion to Quash is denied.

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II.

Supersedeas Bond

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However, Plaintiff is entitled to a supersedeas bond. Burris v. JPMorgan Chase &

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Co., No. CV-18-03012-PHX-DWL, 2022 WL 3285441, at *2 (D. Ariz. Aug. 11, 2022)

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(quoting Matter of Combined Metals Reduction Co., 557 F.2d 179, 193 (9th Cir. 1977))

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(“Under [Rule 62(b)], an appellant may obtain a stay as a matter of right by posting a

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supersedeas bond acceptable to the court. Since no bond was posted, the grant or denial of

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the stays was a matter strictly within the judge's discretion.”). Under Rule 62(b), “any time

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after judgment is entered, a party may obtain a stay by providing a bond or other security.”

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Fed. R. Civ. P. 62(b); see also Fed. R. Civ. P. 62(d) (“The bond may be given upon or after

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filing the notice of appeal or after obtaining the order allowing the appeal. The stay takes

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effect when the court approves the bond.”). Although the Court cannot decline to issue a

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stay upon receipt of a bond, it retains “discretion to set the amount of the bond or to waive

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the bond requirement.” Sw. Fair Hous. Council v. WG Scottsdale LLC, No. CV-19-00180-

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TUC-RM, 2023 WL 183680, at *1 (D. Ariz. Jan. 13, 2023). “To fully protect the

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[prevailing party] on issuance of a stay of judgment, the supersedeas bond amount must be

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set to take into account the additions of interest, costs of appeal, [and] damages for delay.”

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Id. (quoting United States v. Cowan, 535 F. Supp. 2d 1135, 1148 (D. Haw. 2008)) (internal

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punctuation omitted).

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Plaintiff has asked the Court to “proscribe the terms” of the bond but has not

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provided any information about expected interest, damages for delay, the costs of appeal,

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or Plaintiff’s capacity to satisfy the judgment against her. However, “[c]ourts in this

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Circuit have set supersedeas bonds at 120% percent of the amount of the final judgment,

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to account for interest, costs of appeal, and any damages for delay.” Id.; see also United

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States v. Cowan, 535 F. Supp. 2d 1135, 1148 (D. Haw. 2008); Clark v. Hidden Valley Lake

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Ass’n, No. 16-CV-02009-SI, 2018 WL 2412136, at *5 (N.D. Cal. May 29, 2018) (setting

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bond at 125%); Alday v. Raytheon Co., No. CV 06-32 TUC DCB, 2008 WL 11441996, at

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*2 (D. Ariz. Sept. 10, 2008). Thus, the Court will do so here as well.

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Finally, although Plaintiff asks the Court to set the timing for a supersedeas bond,

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Rule 62(d) indicates that the bond may be given after filing the notice of appeal or after

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obtaining the order allowing for appeal, both of which have occurred in this case. Thus,

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the bond may be given at any time.

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CONCLUSION

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Accordingly,

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IT IS THEREFORE ORDERED that Plaintiff’s Motion to Quash is DENIED.

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IT IS FURTHER ORDERED that Plaintiff and Mr. Nathanson shall post a

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supersedeas bond in the form of a cashier’s check made payable to the Clerk of United

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States District Court in the amount of $ 83,490.60 no later than 5:00 p.m. on May 31, 2023.

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IT IS FURTHER ORDERED that a stay of the judgment for the amount due will

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be in effect upon their posting of the bond with the Clerk of Court.
Dated this 23rd day of May, 2023.

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