AF Holding, LLC v. Doe

Filing 45

Order by Hon. Samuel Conti granting 20 Defendant's Motion to Require Undertaking.(sclc2, COURT STAFF) (Filed on 3/18/2013)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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United States District Court

For the Northern District of California

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AF HOLDINGS, LLC,
Plaintiff,

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v.

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ANDREW MAGSUMBOL,
Defendant.

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Case No. 12-4221 SC
ORDER GRANTING DEFENDANT'S
MOTION TO REQUIRE UNDERTAKING
PURSUANT TO CALIFORNIA CODE OF
CIVIL PROCEDURE § 1030

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I.

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INTRODUCTION
Now before the Court is Defendant Andrew Magsumbol's

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("Defendant") motion to require undertaking.

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Defendant's Motion asks the Court to require Plaintiff AF Holdings,

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LLC ("Plaintiff"), a foreign corporation, to post an undertaking

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with the Court pursuant to California Code of Civil Procedure

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section 1030.

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("Opp'n"), 33 ("Reply"), and appropriate for resolution without

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oral argument, Civ. L.R. 7-1(b).

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the Court GRANTS Defendant's Motion.

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See id.

ECF No. 20 ("Mot.").

The motion is fully briefed, ECF Nos. 32

For the reasons explained below,

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DISCUSSION

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Though there is no provision of the Federal Rules of Civil

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Procedure relating to security for costs, "federal district courts

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have the inherent power to require plaintiffs to post security for

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costs."

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573, 574 (9th Cir. 1994).

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district courts follow the forum state's practice regarding

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security for costs, an especially common occurrence when a non-

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resident party is involved.

United States District Court

For the Northern District of California

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Simulnet E. Assocs. v. Ramada Hotel Operating Co., 37 F.3d
In exercising this power, federal

Id.

Section 1030 of the California Code of Civil Procedure allows

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for an undertaking "to secure an award of costs and attorney's

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fees," which may be awarded if (1) "the plaintiff resides out of

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state or is a foreign corporation" and (2) "there is a reasonable

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possibility that the moving defendant will obtain judgment in the

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action . . . ."

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California resident sued by an out-of-state resident to secure

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costs in light of the difficulty of enforcing a judgment for costs

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against a person who is not within the court's jurisdiction . . .

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[and] prevent out-of-state residents from filing frivolous lawsuits

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against California residents."

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12-2396 EMC, 2013 WL 450383, at *2 (quoting Alshafie v. Lallande,

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171 Cal. App. 4th 421, 428 (Cal Ct. App. 2009) (internal quotation

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marks omitted)).

The purpose of this statute is to "enable a

AF Holdings LLC v. Navasca, No. C

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There is no dispute in this matter that Plaintiff is a foreign

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corporation, as alleged in Plaintiff's own First Amended Complaint:

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"[Plaintiff] is a limited liability company organized and existing

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under the laws of the Federation of Saint Kitts and Nevis."

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No. 12 ("FAC") ¶ 2.

ECF

Nor is there a dispute that Defendant is a

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California citizen.

Id. ¶ 4.

The only remaining issues to

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consider are the possibility of Defendant obtaining judgment in

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this action, and the Ninth Circuit's guidance on the imposition of

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bonds.

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California Code of Civil Procedure section 1030 requires only

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that there be a "reasonable possibility" that the moving defendant

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will obtain judgment in the action.

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See, e.g., Navasca, 2013 WL 450383, at *2.

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that Plaintiff's evidence supporting its infringement claim is

Here, Defendant argues

United States District Court

For the Northern District of California

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weak.

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that Plaintiff's core allegations of infringement -- mere

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association of Defendant's Internet Service Provider subscription

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information with the Internet Protocol address linked to the

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allegedly infringed file -- is insufficient to establish that the

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subscriber was the person who allegedly infringed copyright.

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e.g., Navasca, 2013 WL 450383, at *2-3; SBO Pictures, Inc. v. Does

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1-3036, No. 11-4220 SC, 2011 WL 6002620, at *3 (N.D. Cal. Nov. 30,

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2011).

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Defendant himself actually infringed the file at issue here,

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despite its surprising assertion that it possesses such details but

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chose not to describe them in its reply brief or complaint.

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Reply at 8-9.

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place on Defendant a higher burden of proof than he has under the

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law.

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possibility of obtaining judgment.

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Mot. at 8-12.

This is a relatively low bar.

This Court and others have held repeatedly

See,

Plaintiff provides no additional details to indicate that

See

Plaintiff's other arguments all involve attempts to

The Court finds that Defendant has shown a reasonable

Therefore, following this Court's rulings in previous, almost-

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identical cases, the Court will require Plaintiff to post an

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undertaking in this matter.

See Navasca, 2013 WL 450383 at *4; AF

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Holdings v. Trinh, No. 12-02393 CRB, 2012 U.S. Dist. LEXIS 161394,

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at *3 (N.D. Cal. Nov. 9, 2012).

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whether the amount of the undertaking Defendant requests is

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appropriate.

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undertaking of $48,000 in costs and fees after determining that the

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originally requested undertaking of $88,000 was excessive because

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Defendant's counsel's proposed fees were not reasonable given

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Defendant's characterization of the case as frivolous and simple.

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2012 U.S. Dist. LEXIS 161394 at *3.

United States District Court

In Trinh, for example, this Court required an

In this case, Defendant's counsel expects to incur $73,875 in

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For the Northern District of California

The only remaining question is

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costs and fees, estimating about 293 hours of work at a $250 per

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hour billing rate.

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amount excessive.

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hours he might spend on this case is unreasonably high, especially

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since he is, by now, an old hand in these matters.

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concludes, in line with its previous decisions, that a total

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undertaking of $48,000 is appropriate.

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a lodestar of $37,500, calculated by multiplying Defendant's

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counsel's $250 per hour billing rate by an estimated 150 hours of

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work, plus Defendant's estimated $10,500 in costs.

Mot. at 17.

The Court finds the requested

Defendant's counsel's estimation of the total

The Court

That amount is comprised of

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In granting Defendant's motion, the Court is cognizant of

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Plaintiff's concerns about having to post an undertaking each time

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it attempts to pursue a copyright infringement claim.

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that copyright infringement cases frequently take place in other

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courts without the "special disadvantage" of plaintiffs being

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required to post undertakings.

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in one of those other courts, and in this Court, undertakings for

See Reply at

However, the Court finds unconvincing Plaintiff's protestations

See id.

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Plaintiff is not presently

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foreign corporations may be required under California law.

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CONCLUSION

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For the reasons explained above, the Court GRANTS Defendant

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Andrew Magsumbol's Motion to Require an Undertaking.

Plaintiff AF

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Holdings, LLC is required to post an undertaking of $48,000 with

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the Court within thirty (30) days of this Order's signature date,

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or this action may be dismissed with prejudice.

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United States District Court

For the Northern District of California

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IT IS SO ORDERED.

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Dated: March 18
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UNITED STATES DISTRICT JUDGE

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