Wallis et al v. Centennial Insurance Company Inc et al
Filing
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ORDER signed by Senior Judge William B. Shubb on 12/2/2014 DENYING 309 Motion for Equitable Offset and Stay of Enforcement of Judgment. (Michel, G)
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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----oo0oo----
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DALE M. WALLIS, D.V.M., JAMES
L. WALLIS, and HYGIEIA
BIOLOGICAL LABORATORIES,
INC., a California
Corporation,
Plaintiffs,
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CIV. NO. 2:08-2558 WBS AC
MEMORANDUM AND ORDER RE:
PLAINTIFF’S MOTION FOR EQUITABLE
OFFSET AND STAY OF ENFORCEMENT
OF JUDGMENT
v.
CENTENNIAL INSURANCE COMPANY,
INC., a New York corporation,
ATLANTIC MUTUAL INSURANCE,
CO., INC., a New York
corporation,
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Defendants.
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----oo0oo---I.
Factual and Procedural Background
Plaintiffs Dale M. Wallis, D.V.M. (“Dr. Wallis”), James
L. Wallis (“Mr. Wallis”), and Hygieia Biological Laboratories,
Inc. (“Hygieia”) filed a lawsuit against defendants Centennial
Insurance Company, Inc. (“Centennial”) and Atlantic Mutual
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Insurance Company (“Atlantic Mutual”) arising out of defendants’
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alleged wrongdoing in defending Dr. Wallis under a professional
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liability insurance policy.
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counterclaim against plaintiffs and a third party complaint
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(“TPC”) against plaintiffs’ Cumis counsel, Joanna Mendoza,
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seeking, inter alia, a declaration that they had no duty to
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indemnify plaintiffs or Mendoza in connection with a breach of a
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protective order and subsequent sanctions.
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2013 Judgment (Docket No. 269).)
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Defendants subsequently filed a
(See November 12,
After conducting a nine-day bench trial, the court
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found in favor of defendants on both of plaintiffs’ claims and
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ordered reimbursement for $115,995.90 in fees paid out to
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Mendoza.
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subsequently amended the judgment to $86,996.93 and $4,607.65 in
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costs against plaintiffs.
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Judgment (Docket No. 277).)
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288), and the appeal is still pending.
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stay the enforcement of the judgment pursuant to Federal Rule of
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Civil Procedure 62.
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pending arbitration regarding the reasonableness of Mendoza’s
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fees, and on their claim for $5.6 million in defendants’
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liquidation proceedings in New York court, they will be entitled
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to an offset of the judgment entered by this court.
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at 4-7.)
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II.
(See November 12, 2013 Judgment.)
The court
(See February 20, 2014 Amended
Plaintiffs appealed, (Docket No.
Plaintiffs now move to
They state that, should they prevail in a
(Pls.’ Mem.
Discussion
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Federal Rule of Civil Procedure 62 permits a court to
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stay the execution of a judgment or proceedings to enforce that
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judgment pending disposition of a Rule 60 motion.
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Fed. R. Civ.
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P. 62(b); see Gibbs v. Okla. Dep’t of Transp., 999 F.2d 547, 547
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(10th Cir. 1993) (“The decision to stay proceedings to enforce a
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judgment pending disposition of a motion for new trial or to
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alter or amend judgment or for relief from judgment is left to
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the discretion of the district court.”).
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their motion to stay execution of the judgment on their
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simultaneous motion for relief from a judgment pursuant to Rule
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60(b)(6) (“any other reason that justifies relief”).1
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that plaintiffs provide is that under California law, enforcement
Plaintiffs premise
The reason
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on a money judgment should be stayed under the principle of
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equitable offset.
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judgment debtors, have unresolved claims against defendants, they
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contend, “a stay is appropriate and necessary so that all the
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claims can be offset against one another when both are final.”
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(Id.)
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(Pls.’ Mem. at 3.)
Because plaintiffs, the
“Once an appeal is filed, the district court no longer
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has jurisdiction to consider motions to vacate judgment.”
Davis
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v. Yageo Corp., 481 F.3d 661, 685 (9th Cir. 2007) (citing Gould
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v. Mutual Life Ins. Co. of N.Y. (“The filing of a notice of
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appeal divests the district court of jurisdiction.”)).
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after an appeal is filed, “a district court may entertain and
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decide a Rule 60(b) motion . . . if the movant follows a certain
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procedure, which is to ‘ask the district court whether it wishes
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to entertain the motion, or to grant it, and then move [the court
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of appeals], if appropriate, for remand of the case.’”
However,
Id.
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Plaintiffs do not pursue a stay under 60(d), Stay with
Bond on Appeal, nor could they, because they have not posted a
supersedeas bond. See Fed. R. Civ. P. 60(d).
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(quoting Gould, 790 F.2d at 772).
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judgment entered against them, (see March 21, 2014 Notice of
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Appeal (Docket No. 288)), and the appeal is still pending, (see
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Pl.’s Mem. at 3).
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consider plaintiffs’ Rule 60 motion, or its Rule 62 motion for
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that matter, which is premised on the pending disposition of the
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Rule 60 motion.
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trial motion, then they must ask this court whether it wishes to
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entertain their motion, and if the court agrees, they must move
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Plaintiffs appealed the
This court thus no longer has jurisdiction to
If plaintiffs want to pursue their Rule 60 post-
in the Ninth Circuit to have the case remanded to this court.
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Even if the court were to consider the present motion
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as a request to entertain plaintiffs’ Rule 60 motion, the court
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would not be inclined to hear the motion.
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be ‘used sparingly as an equitable remedy to prevent manifest
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injustice’ and ‘is to be utilized only where extraordinary
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circumstances to prevent or correct an erroneous judgment.’”
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re Int’l Fibercom, Inc., 503 F.3d 933, 941 (9th Cir. 2007)
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(citing United States v. Washington, 394 F.3d 1152, 1157 (9th
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Cir. 2005)).
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is erroneous.
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what they argue is an equitable right for a stay under California
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law.
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vacating an erroneous judgment, not for staying a proper one.
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Plaintiffs are in essence attempting to shoehorn a state-law
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ground for staying the enforcement of a judgment into Rule 62(b),
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which is limited in its scope to staying judgment enforcement
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pending resolution of certain post-trial motions.
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///
“Rule 60(b)(6) should
In
Plaintiffs do not contend the judgment against them
Rather, plaintiffs base their Rule 60 motion on
(Pl.’s Mem. at 5.)
Rule 60(b), however, is a vehicle for
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IT IS THEREFORE ORDERED that plaintiffs’ Rule 60 and 62
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motions be, and the same hereby are, DENIED.
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Dated:
December 2, 2014
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