Golloher et al v. Todd Christopher International, Inc.
Filing
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ORDER DENYING MOTION FOR POSTING OF APPEAL BOND AND DISCOVERY. Signed by Judge Richard Seeborg on 7/7/14. (cl, COURT STAFF) (Filed on 7/7/2014)
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IN THE UNITED STATES DISTRICT COURT
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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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SAN FRANCISCO DIVISION
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For the Northern District of California
United States District Court
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ANDREA GOLLOHER, et al.,
Plaintiffs,
v.
No. C 12-06002 RS
ORDER DENYING MOTION FOR
POSTING OF APPEAL BOND AND
DISCOVERY
TODD CHRISTOPHER
INTERNATIONAL, INC. DBA VOGUE
INTERNATIONAL,
Defendant.
____________________________________/
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Plaintiffs seek an order requiring the objectors who have filed an appeal in this action to post
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a bond pursuant to Rule 7 of the Federal Rules of Appellate Procedure, and to submit to depositions
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and written discovery. Pursuant to Civil Local Rule 7-1(b), the motion is suitable for disposition
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without oral argument, and the hearing set for July 10, 2014 is vacated.
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Plaintiffs contend that the appeals are frivolous and motivated by a desire “to extract a
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payout from Class Counsel or the Class,” rather than by any genuine desire to benefit the class.
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While the appeals appear to lack substantial merit or legal justification, Rule 7 is not a vehicle for
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screening out frivolous appeals. As the Ninth Circuit has made clear, “the question of whether, or
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how, to deter frivolous appeals is best left to the courts of appeals, which may dispose of the appeal
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at the outset through a screening process, grant an appellee’s motion to dismiss, or impose sanctions
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including attorney’s fees under Rule 38 . . . Allowing districts court to impose high Rule 7 bonds on
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where the appeals might be found frivolous risks impermissibly encumbering appellants’ right to
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appeal and effectively preempts [the appellate court’s] prerogative to make its own frivolousness
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determination.” Azizian v. Federated Department Stores, Inc., 499 F.3d 950, 961 (9th Cir. 2007)
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(internal citation, alterations, and quotation marks omitted).
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Rule 7 provides, in relevant part, “[i]n a civil case, the district court may require an
payment of costs on appeal.” As reflected in the language of the rule, its purpose is to “protect[ ] . .
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. an appellee against the risk of nonpayment by an unsuccessful appellant.” In re AOL Time Warner,
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Inc., 2007 WL 2741033, *2 (S.D.N.Y. Sept. 20, 2007); see also Page v. A.H. Robins Co., 85 F.R.D.
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For the Northern District of California
appellant to file a bond or provide other security in any form and amount necessary to ensure
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United States District Court
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139, 139-40 (E.D.Va. 1980) (“[T]he purpose[ ] of an appeal bond is to provide an appellee security
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for the payment of such costs as may be awarded to him in the event that the appellant is
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unsuccessful in his appeal.”). The advisory committee notes to Rule 7 indicate that the question of
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the need for a bond, as well as its amount, are left to the discretion of the trial court. See Fed.
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R.App. 7, 1979 advisory committee notes. Thus, plaintiffs’ argument that a bond should be required
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before objectors “can use the time and expense of an appeal to hold a class action settlement
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hostage” misapprehends the purpose of the rule.
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Additionally, plaintiffs’ attempt to impose a bond requirement as a deterrent to frivolous or
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bad faith appeals rests on their further contention that a relatively large bond would be appropriate.
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Specifically, plaintiffs request a bond in the amount of $12,890, representing (1) $175 in estimated
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copying costs they contend will be recoverable under Rule 39 of the Federal Rules of Appellate
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Procedure, and (2) $12,715 in estimated costs of “settlement administration pending the
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appeals.” While the claim for $175 might be appropriate, the $12,715 is not.
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In Azizian v. Federated Department Stores, Inc., 499 F.3d 950 (9th Cir. 2007), the Ninth
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Circuit noted that Rule 7 does not define “costs on appeal.” Id. at 958. Azizian rejected the position,
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adopted by some courts, that the term is synonymous with the “costs” listed in Rule 39 as
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recoverable by a party prevailing on appeal. Id. at 956. Instead, the court concluded, for purposes
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of Rule 7 the term “costs on appeal” also “includes all expenses defined as ‘costs’ by an applicable
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fee-shifting statute, including attorney’s fees.” Id. at 958. While Azizian does not expressly address
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“administrative costs” such as those claimed by plaintiffs here, it demonstrates items included in
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bond amounts under Rule 7 must be authorized by some rule or statutory provision—if an item does
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not appear as a recoverable cost in Rule 39, then the party seeking to include it in a bond amount
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must show some other basis for treating it as such.
More fundamentally, the question is not whether an item represents a “cost” an appellee
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may incur during an appeal, but whether such “cost” is one that a losing appellant will become
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responsible for paying to the appellee. Indeed, in Azizian the court held inclusion of fees in a bond
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amount to be improper—notwithstanding the existence of a fee-shifting statute—because the
appellant would not have been liable for those fees even if he lost, given that the fee-shifting statute
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For the Northern District of California
United States District Court
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was “asymmetrical.” Id. at 959-60. Here, plaintiffs have pointed to no rule or statute that would
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render objectors liable for the “administrative costs” even assuming their appeals fail. Accordingly,
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there is no basis to require objectors to post a bond for those costs.
Given that there is no reason to believe a bond is necessary to ensure that plaintiffs will be
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able to recover their $175 in copying costs, and under all the circumstances here, discretion weighs
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against imposing any requirement that a bond be posted. Accordingly, that portion of the motion is
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denied.
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Plaintiffs’ request to take discovery is also denied. Plaintiffs rely on Laguna v. Coverall
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North America, Inc., __ F.3d __, 2014 WL 2465049 (9th Cir. 2014) for the proposition that “courts
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commonly require objectors to make themselves available for deposition given the power held by
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objectors.” While such discovery may be available and “common” in the context of pending
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settlement approval proceedings, plaintiffs have not shown it would be appropriate for the district
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court to allow it in the context of an appeal. It is unclear what relevance any such discovery would
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have to the issues on appeal, or even if or how it would become part of the appellate record.
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IT IS SO ORDERED.
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Dated: 7/7/14
RICHARD SEEBORG
UNITED STATES DISTRICT JUDGE
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For the Northern District of California
United States District Court
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