Langdale Capital Assets, Inc. et al v. Woodard et al

Filing 17

ORDER denying 1 motion to stay pending appeal. Signed by Judge Susan C Bucklew on 11/12/2014. (JD)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION

In re:
SYNECTIC ASSET MANAGEMENT INC.,

Bankr. Case No. 8:09-bk-5172 CED
Apv. Pro. 8:13-ap-469-CED

Debtor,
____________________________________/
LANGDALE CAPITAL ASSETS, INC., a
Georgia for profit corporation; JLD
PROPERTIES, LLC a Georgia limited
liability company; FERRELL SCRUGGS, Jr.,
an individual; and PATRICK ROBINSON,
an individual,

Case No. 8:14-cv-2762-T-24

Appellants,
v.
SUSAN WOODARD, as Chapter 7 Trustee
of the Bankruptcy Estate of Synectic Asset
Management Inc., SYNECTIC VENTURES I,
LLC, SYNECTIC VENTURES II, LLC and
SYNECTIC VENTURES III, LLC,
Appellees.
____________________________________/
ORDER
This cause comes before the Court on Appellants’ Emergency Motion for Stay Pending
Appeal. (Doc. No. 1). The Court held a hearing on the motion on November 12, 2014. As
explained below, the motion is denied.
I. Bankruptcy Court’s Order Being Appealed
On September 29, 2014, the bankruptcy court granted Appellees’ motions for summary
judgment and denied Appellants’ motions for summary judgment. (Doc. No. 1-4). The facts of

this case are thoroughly described in the bankruptcy court’s well-written order, but a summary of
the relevant facts follows.
Berkman’s First Fraudulent Scheme
The debtor, Craig Berkman, ran an elaborate Ponzi scheme, which included the use of
various companies, including Synectic Ventures I, LLC, Synectic Ventures II, LLC, and Synectic
Ventures III, LLC (collectively, “Synectic Funds”). Berkman conducted business through a
management company, Synectic Asset Management Company, Inc. (“SAM”).
In 2005, the Synectic Funds filed a lawsuit against Berkman in Oregon state court, and
thereafter, Berkman transferred title to certain assets to himself and his wife as tenants by the
entirety. Those assets included a home that cost almost $4 million, over 600,000 shares of stock
in EVI Corporation, and nearly all of the money in his bank accounts.
In 2008, judgment was entered against Berkman and SAM in the Oregon state court,
jointly and severally, in favor of the Synectic Funds for compensatory damages of $15 million,
plus punitive damages against Berkman for $10 million and punitive damages against SAM for
$4.7 million. Despite these judgments, Berkman continued to conduct business that he managed
through SAM.
Bankruptcy Proceedings and Global Settlement of Claims
In 2009, the Synectic Funds filed involuntary bankruptcy petitions against Berkman and
SAM. Susan Woodward was appointed as the Chapter 7 Trustee for both bankruptcy cases. In
the Berkman bankruptcy case, the Trustee filed objections to Berkman’s claimed exemptions for
tenancy by the entireties properties consisting of the home, EVI stock, and the money in the bank
accounts. The Trustee also filed an adversary proceeding to avoid and recover the transfers of

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those assets. The Synectic Funds commenced two adversary proceedings against Berkman—one
objecting to his bankruptcy discharge and one to except their claim from discharge. In the SAM
bankruptcy case, the Trustee filed three adversary proceedings against Berkman and related
entities, including proceedings to avoid transfers of $295,000 and $50,000.
Thereafter, the Trustee and Synectic Funds on one side and Berkman and SAM on the
other side negotiated a settlement of all of the issues between them (the “Global Settlement
Agreement” or “GSA”). The GSA required Berkman to pay a total of $4.75 million to the
Trustee (in installments) in exchange for the Trustee’s abatement, and eventual dismissal, of the
pending litigation against Berkman and SAM and the Trustee’s sale of other estate assets back to
Berkman. The settlement funds were to be divided equally between the Berkman and SAM
bankruptcy cases. The Synectic Funds, in consideration of the receipt of their share of the
Trustee’s distributions to unsecured creditors (which would include Berkman’s $4.75 million
settlement payment), agreed to dismiss their adversary proceedings so that the balance of the debt
owed to them by Berkman would be discharged. The Synectic Funds also agreed to pay $97,270
and transfer shares of stock in an unrelated company, Well Partner, to one of Berkman’s
companies.
Section 4.2 of the GSA provides that if Berkman defaulted on the settlement payments or
failed to satisfy the requirements of Section 4.5, the GSA would be terminated and of no further
effect. Section 4.5 of the GSA provides the following:
In connection with seeking approval of [the GSA], Mr. Berkman’s
counsel will (i) certify that (a) the source of the Settlement Funds is
compensation paid or to be paid to Mr. Berkman and is not from an
investment fund which is managed for the benefit of third parties, and
(b) the funding source has been given notice of the settlement
approval objection/hearing process at least five business days in
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advance of the date of the hearing by the Bankruptcy Court, (ii)
provide proof of such notice to the Bankruptcy Court confidentially
and under seal, without access to such notice by the Trustee, and
Petitioning Creditors [the Synectic Funds] or any other creditors, and
(iii) seek and obtain a finding from the Bankruptcy Court that Mr.
Berkman’s fund-raising transaction that is the source of the Settlement
Funds is a good faith transaction arising postpetition.
(SAM Bankr. Doc. No. 61-1 )(emphasis added).
The Trustee filed a motion with the bankruptcy court to approve the GSA. Additionally,
pursuant to Section 4.5 of the GSA, Berkman’s attorney submitted documentation under seal that
the source of funds to be used to make the settlement payments were from Berkman’s earnings
from a company, Ventures Trust Management, LLC (“VTM”), in which Berkman had no
ownership interest and that the funds used to pay Berkman were not derived from investors in
VTM projects or from projects or funds that are managed by VTM for the benefit of third parties.
On May 27, 2011, the bankruptcy court approved the GSA and found that Berkman was
making the settlement payments from compensation to be paid to him from a post-petition good
faith transaction.1 Berkman paid $1.5 million prior to the bankruptcy court’s approval of the GSA
and Berkman’s attorney’s certification of the funding, and Berkman continued making all of the
payments thereafter. Once Berkman paid the entire $4.75 million, the Trustee allocated the
settlement funds between the Berkman and SAM bankruptcy estates. In return, the Trustee

1

By the time that the bankruptcy court approved the GSA, Berkman had already paid $1.5
million due under the GSA. (SAM Bankr. Doc. No. 87). However, because Berkman had failed
to pay additional amounts due, the Court declared Berkman to be in default of the GSA in the
same order that the bankruptcy court approved the GSA. (SAM Bankr. Doc. No. 87). The GSA
was later reinstated on August 30, 2011, and Berkman was again found to be in default after
paying an additional $100,000. (SAM Bankr. Doc. No. 93-1, 99). Thereafter, on May 18, 2012,
the GSA was again reinstated and the GSA was fully paid the remaining amount due thereunder.
(Doc. No. 141).
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withdrew her objections to Berkman’s claimed exemptions in the Berkman bankruptcy case, the
Trustee gave Berkman a bill of sale that conveyed all of the Trustee’s rights title, and interest in
all of the scheduled assets in the Berkman and SAM bankruptcy cases, the Synectic Funds
obtained an order vacating the bankruptcy order that had declared their underlying $25 million
judgment against Berkman to be non-dischargeable, the Synectic Funds moved to vacate their
underlying Oregon (and domesticated Florida) judgments against Berkman and SAM, and the
Synectic Funds paid $97,270 and transferred 13,000 shares of Well Partner stock to one of
Berkman’s companies.
On December 15, 2012, the Trustee distributed the funds in Berkman’s bankruptcy estate
(totaling approximately $2.1 million) to his creditors, which included Alco Holdings, LLC
(“Alco”) and the Synectic Funds. On March 8, 2013, the Trustee filed her amended Final Report
in the SAM bankruptcy, in which she indicated that there was approximately $2.4 million in
funds available for distribution to creditors. The SAM bankruptcy funds have not yet been
distributed.
Berkman’s Second Fraudulent Scheme and Effect on Bankruptcy Proceedings
Thereafter, Berkman was charged with securities and wire fraud in New York federal
court relating to entities controlled by Berkman between December 2010 and March 2013 that
had fraudulently obtained over $13 million from 120 investors. Berkman pled guilty and is now
incarcerated. As a result of the criminal charges, the Trustee filed an adversary proceeding in
Berkman’s bankruptcy case to revoke the discharge, which the bankruptcy court granted.
On April 19, 2013, Langdale Capital Assets, Inc., JLD Properties, LLC, Ferrell Scruggs,
Jr., and Patrick Robinson (collectively, “Langdale Plaintiffs”) commenced an adversary

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proceeding in the Berkman bankruptcy case seeking to avoid the transfers from Berkman to the
Trustee, and the subsequent transfers from the Trustee to the Synectic Funds and Alco, as
fraudulent transfers under Florida’s Uniform Fraudulent Transfers Act (“FUFTA”), specifically
Fla. Stat. §§ 726.105(1)(a), 726.105(1)(b), and 726.106(1) (the “Berkman Adversary”). In their
amended complaint, in addition to the fraudulent transfer claims, the Langdale Plaintiffs also
asserted claims for unjust enrichment and money had and received.
The Langdale Plaintiffs alleged that they are victims of Berkman’s most recent fraudulent
scheme, having wired funds totaling $1.8 million into one or more accounts that Berkman
controlled. They further alleged that Berkman used all or a substantial part of those funds to
make the settlement payments under the GSA to the Trustee.
Thereafter, 33 more victims of Berkman’s second fraudulent scheme (collectively referred
to as the “Investment Group” and, together with the Langdale Plaintiffs, “Plaintiffs”) intervened
in the Berkman Adversary and filed a third-party complaint. The Investment Group alleged that
from November 2010 through May 2012, its 33 individual members invested a total of
$5,185,088 with Berkman by wiring funds into one or more accounts that he controlled. The
Investment Group asserted the same causes of action as the Langdale Plaintiffs.
In the SAM bankruptcy case, the Langdale Plaintiffs filed an emergency motion to vacate
the Trustee’s court-approved Final Report. The Trustee, who had not yet made distributions to
creditors in the SAM bankruptcy case, filed a complaint against the Langdale Plaintiffs for
declaratory and injunctive relief, seeking a judicial determination that the Langdale Plaintiffs
have no rights to the property in the Trustee’s possession and that the Trustee is authorized to
make distributions to creditors (the “SAM Adversary”). The Langdale Plaintiffs answered and

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counterclaimed on the same grounds that they alleged in their amended complaint in the Berkman
Adversary. The Investment Group sought and obtained leave to intervene in the SAM Adversary
as defendants and counter-plaintiffs.
Summary Judgment Motions at Issue in the Appeal
The summary judgment order at issue deals with both the Berkman Adversary and SAM
Adversary, as the issues in both adversary cases are identical. However, Appellants (the
Langdale Plaintiffs and the Investment Group) are only appealing, in this case, the summary
judgment order as it relates to the SAM adversary. The Appellants have filed another case
appealing the summary judgment order as it relates to the Berkman Adversary.2
In the bankruptcy court’s summary judgment order, the Court granted Appellees (the
Trustee and Synectic Funds) summary judgment on Appellants’ FUFTA claims. Appellants’
FUFTA claims are: (1) that Berkman transferred the settlement payments with the actual intent to
hinder, delay, or defraud creditors; (2) that Berkman transferred the settlement payments without
receiving a reasonably equivalent value in exchange for the transfer while Berkman (I) was
engaged or about to engage in a transaction for which his remaining assets were unreasonably
small in relation to the transaction or business, or (ii) intended to incur, or believed or reasonably
believed that he would incur, debts beyond his ability to pay; and (3) that Berkman made the
transfer without receiving reasonably equivalent value and either was insolvent at the time of the
transfer or became insolvent as a result of the transfer. With respect to the first FUFTA
claim—that Berkman transferred the settlement payments with the actual intent to hinder, delay,
or defraud creditors—the Trustee asserted the affirmative defense that she accepted the settlement

2

Case No. 8:14-cv-2802-T-27.
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payments in good faith and for a reasonably equivalent value. Therefore, in order for Appellants
to succeed on their FUFTA claims, the bankruptcy court had to find that the Trustee took the
settlement payments for less than reasonably equivalent value.
The bankruptcy court concluded that the evidence established that the Trustee did not take
the settlement payments for less than reasonably equivalent value. The bankruptcy court found
that Berkman’s payment of the $4.75 million in settlement funds to the Trustee was on account of
an antecedent debt; i.e., his liability to the Trustee on her claims against him in the adversary
proceedings. Furthermore, the bankruptcy court found that the Synectic Funds and Alco received
their distributions from the Trustee in the Berkman bankruptcy case on account of Berkman’s
antecedent debts to them.
The bankruptcy court also rejected Appellants’ argument that the GSA is void due to
Sections 4.2 and 4.5, and as a result, the Synectic Funds’ judgment could be revived and the
Trustee could pursue her rights against Berkman. Appellants argued that because Berkman lied
about the source of the funds used for the GSA’s settlement payments, the GSA is now void.
However, the bankruptcy court pointed out that Appellants misread Section 4.5 of the GSA,
which simply requires that Berkman’s attorney certify to the bankruptcy court (and obtain a
finding from the bankruptcy court) that the source of the settlement funds that Berkman paid
under the GSA is from a good faith transaction arising post-petition. Berkman’s counsel
complied with Section 4.5, and as a result, the GSA is not void pursuant to Section 4.2.
Additionally, the bankruptcy court concluded that the Trustee objectively acted in good
faith because there was no evidence that she had actual knowledge of the Berkman’s fraudulent
purpose or knowledge of such facts or circumstances that would have caused an ordinarily

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prudent person to make further inquiry, which would have disclosed Berkman’s fraudulent
purpose. Because the bankruptcy court found that the Trustee did not take the settlement
payments for less than reasonably equivalent value and that the Trustee acted in good faith, the
bankruptcy court granted summary judgment in favor of Appellees on Appellants’ FUFTA
claims.
Likewise, the bankruptcy court granted summary judgment in favor of Appellees on
Appellants’ unjust enrichment claim, because the Trustee provided reasonably equivalent value to
Berkman in exchange for the settlement funds. Furthermore, the bankruptcy court noted that the
unjust enrichment claim failed for an additional reason—there was nothing inequitable in
allowing the Trustee (and those to whom the Trustee had made distributions) to retain the
settlement payments, because the Trustee acquired the settlement payments in a lawful manner.
The bankruptcy court also court granted summary judgment in favor of Appellees on
Appellants’ claim for money had and received. The bankruptcy court stated that this claim
required Appellants to show that the Trustee received Appellants’ money as a result of Berkman’s
fraud and that the circumstances are such that the Trustee should, in all fairness, be required to
return the money to Appellants. Stated differently, Appellants were required to show that an
injustice would occur if the money was not refunded. However, the bankruptcy court stated that
the injustice must arise from Appellees’ own actions. Having found that the Trustee did nothing
improper, the bankruptcy court granted summary judgment in favor of Appellees on this claim.
Finally, the bankruptcy court granted summary judgment in favor of Appellees on
Appellants’ claim for injunctive relief. Appellants asked the bankruptcy court to enjoin the
Trustee from concluding her administration of the SAM bankruptcy estate and distributing the

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funds to the estate’s creditors. The bankruptcy court denied the relief, given that Appellants had
failed to show a likelihood of success on the merits of their other claims.
II. Notice of Appeal and Request for a Stay
Appellants now appeal the bankruptcy court’s summary judgment order as it relates to the
SAM bankruptcy case. Additionally they seek a stay of the bankruptcy court’s order denying
them injunctive relief in the form of enjoining the distribution of funds to the creditors of the
SAM bankruptcy estate pending this appeal.
Appellants first sought a stay pending appeal from the bankruptcy court, which denied
their motion. As a result, Appellants filed the instant motion to stay in this Court.
III. Motion to Stay Pending Appeal
In order to obtain a stay pending appeal, the following standard applies:
The movant must clearly establish: (i) that the movant is likely to
prevail on the merits of its appeal, (ii) that the movant will suffer
irreparable injury if a stay or other injunctive relief is not granted, (iii)
that other parties will suffer no substantial harm if a stay or other
injunctive relief is granted, and (iv) in circumstances where the public
interest is implicated, that the issuance of a stay or other injunctive
relief will serve, rather than disserve, such public interest.
In re F.G. Metals, Inc., 390 B.R. 467, 471-72 (M.D. Fla. 2008)(citations omitted). Furthermore,
“[t]he moving party's likelihood of prevailing on the merits of its appeal is generally the most
important of the four criteria identified above, and the Court must ordinarily find that the
appealed decision was clearly erroneous.” Id. at 472 (citation omitted). However, “the movant
may also have his motion granted upon a lesser showing of a “substantial case on the merits”
when the balance of the equities [identified in factors 2, 3, and 4 above] weighs heavily in favor
of granting the stay.” Garcia-Mir v. Meese, 781 F.2d 1450, 1453 (11th Cir. 1986)(quotation

10

marks and citation omitted).
Likelihood of Success
Appellants fail to show that a stay pending appeal should be granted. Based on the record
before this Court and the oral argument on this motion, Appellants fail to show that the
bankruptcy court erred such that they will likely succeed on the merits of this appeal.
Appellants make three arguments in support of their contention that the bankruptcy court
erred: (1) because it is undisputed that the funds stolen from Appellants were used to pay the
GSA,3 equity requires that this Court undo the GSA as it relates to the SAM bankruptcy estate
and put the parties back in the position that they were in before the stolen money was used to fund
the GSA; (2) the Trustee and the Synectic Funds did not give reasonably equivalent value in
exchange for the $4.75 million paid under the GSA; and (3) the Trustee’s conduct, in failing to
seek certification regarding the final $3.15 million payment after the approval of the GSA, led to
the payment of the GSA with stolen funds. As explained below, the Court rejects these
arguments.
First, Appellants argue that the bankruptcy court erred because it is undisputed that the
funds stolen from Appellants were used to pay the GSA. As such, Appellants contend that equity
requires that this Court undo the GSA as it relates to the SAM bankruptcy estate and put the
parties back in the position that they were in before the stolen money was used to fund the GSA.
The flaw in this argument is two-fold: First, as explained later in this Order, the Trustee gave
reasonably equivalent value in exchange for the $4.75 million settlement payment, and as such,
equity does not require this Court to undo the GSA.
Second, it is not clear to this Court that it would be able to return the parties back to their
3

At the hearing, the Synectic Funds stated that no one disputes that the final $3.15 million
payment made under the GSA was done using Appellants’ stolen funds.
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original positions. Appellants have not shown that the bankruptcy court or this Court has the
power to reinstate judgments that were entered and vacated in Florida and Oregon state courts.
Furthermore, even if this Court could reinstate the Trustee’s liens on Berkman’s property,
Appellants have not shown that the Trustee would necessarily be able to be returned to the
priority positions that her liens previously held.
Next, Appellants argue that the bankruptcy court erred because the Trustee and the
Synectic Funds did not give reasonably equivalent value in exchange for the $4.75 million paid
under the GSA. Appellants, however, have not shown this contention to be correct. Among other
things, the Trustee withdrew her objections to the exemptions that Berkman claimed in his
bankruptcy case, the Synectic Funds had the bankruptcy court vacate its order that their $25
million judgment was non-dischargeable, and the Synectic Funds vacated their Oregon and
Florida judgments against Berkman and SAM. While Appellants contend that these actions were
essentially worthless because there were no assets to satisfy these claims, the Court cannot
conclude that Appellants’ assessment is correct. It is undisputed that Berkman is a sophisticated
fraudster who wrongfully obtained millions of dollars. While no one can currently find any other
assets that he owns, this Court cannot conclude that Berkman is in fact judgment-proof, such that
any claims against him that were given up via the GSA were essentially worthless. He may have
assets that are well-hidden, which could make the $25 million judgment against him a valuable
concession.
Furthermore, reasonably equivalent value does not require a dollar-for-dollar transaction.
See In re Southmark Corp., 138 B.R. 820, 829 (Bankr. N.D. Tx. 1992)(citation omitted). In
determining whether reasonably equivalent value was given, courts employ a two-step analysis:4
4

This Court is aware that the following approach comes from a case analyzing
“reasonably equivalent value” under the bankruptcy code. However, Appellants argued at the
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First, the court must determine whether [Berkman] received any value
at all in exchange for the transfer. The inquiry in the first step of the
analysis is whether [Berkman] obtained “any benefit . . . whether
direct or indirect” . . . . Second, if it is determined that “value” was in
fact conferred on [Berkman] as a result of the transaction, the court
must then determine whether that value was reasonably equivalent to
the cash transferred by [Berkman]. In making this assessment, the
court may apply a “totality of the circumstances” test. The totality of
the circumstances test includes the consideration of a variety of
factors, such as the fair market value of the item or service received
compared to the price paid, the arms-length nature of the transaction,
and the good faith of the transferee.
In re Tower Environmental, Inc., 260 B.R. 213, 225 (Bankr. M.D. Fla. 1998)(citation omitted).
It is undisputed that Berkman did, in fact, obtain value from the transfer. Instead,
Appellants dispute whether that value was reasonably equivalent to the $4.75 million transferred
by Berkman. The Court concludes that at this early stage of the appeal, Appellants have not
shown that the bankruptcy court erred in finding that Berkman received a reasonably equivalent
value under the GSA. See In re Southmark Corp., 138 B.R. at 829, 830 (finding that the release
of a judgment against the debtor for $22 million was reasonably equivalent value given in
exchange for the payment of $16.5 million; the underlying debtor argued against this conclusion
and contended that the $22 million judgment was only worth $2.2 million under the debtor’s
confirmed plan of reorganization).
Next, Appellants argue that the bankruptcy court erred because it was the Trustee’s own
conduct, in failing to seek certification regarding the final $3.15 million payment after the
approval of the GSA, that led to the payment of the GSA with stolen funds. At the hearing before
this Court, Appellants appeared to argue that Berkman’s attorney was required to re-certify that
the funds used to pay the $3.15 million balance due under the GSA were from a legitimate source.
Therefore, Appellants attribute this failure to the Trustee and argue that such certification could
hearing before this Court that this was the appropriate test.
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have prevented their stolen funds from being used to make the final payment under the GSA.
However, Section 4.5 of the GSA only required that “[i]n connection with seeking approval of
[the GSA], Mr. Berkman’s counsel will” make such a certification and obtain the bankruptcy
court’s finding regarding the legitimacy of the funds. (SAM Bankr. Doc. No. 61-1 )(emphasis
added). When the GSA was initially approved, such certification was made and the bankruptcy
court’s finding regarding the legitimacy of the funds was made. No further certification was
required under the GSA.
Furthermore, the bankruptcy court found that the representative of the Langdale Plaintiffs,
attorney William Langdale, was told by Berkman in an in-person meeting about his prior
litigation with the Synectic Funds. However, the bankruptcy court found that Berkman failed to
investigate into the matter further. As a result, the bankruptcy court concluded that as between
the Appellees and Appellants, equity favors the Appellees who had no knowledge that Berkman
was a fraudster, whereas an investigation into Berkman by Appellants would have revealed his
fraudulent background.
Accordingly, for the reasons stated above, the Court concludes that Appellants have failed
to show a likelihood of success on the merits of their appeal.
Remaining Factors
Given that Appellants have not shown that there is a likelihood that they will succeed on
the merits of this appeal, the Court need not consider the remaining factors. However, the Court
will consider the remaining factors, which show that a stay pending appeal is not warranted.
Appellants have failed to show that they will suffer irreparable injury if a stay is not
granted. Appellants are seeking to enjoin the Trustee from distributing funds to the creditors of
the SAM bankruptcy estate pending this appeal. Thus, if the stay is denied, the only injury that

14

may occur is that the Trustee will distribute funds that Appellants contend belong to them; money
damages will cure such an injury. Furthermore, to the extent that Appellants claim that they will
be irreparably harmed by the fact that their efforts to appeal will be effectively impaired by the
distribution of the funds, such an implicit mooting of their appeal does not constitute irreparable
harm. See In re Charter Co., 72 B.R. 70, 72 (Bankr. M.D. Fla, 1987)(stating that the fact that
denial of the requested stay may render the appeal moot is not sufficient to establish irreparable
harm). Furthermore, the Court notes that Appellants are appealing the summary judgment order
in the Berkman bankruptcy case despite the fact that their stolen funds have already been
distributed to the estate’s creditors.
With regard to the third and fourth factors, Appellants have not shown that Appellees and
the creditors of the SAM bankruptcy estate will not suffer substantial harm if a stay is granted.
Instead, granting the stay would unduly delay the administration of the SAM bankruptcy estate
and the creditors of the estate will be harmed by the unnecessary delay. See In re Bob Hamilton
Real Estate, Inc., 164 B.R. 703, 705 (Bankr. M.D. Fla. 1994).
Accordingly, the Court concludes that a stay pending appeal is not warranted. Therefore,
the Court denies Appellants’ motion for a stay pending appeal.
IV. Alternative Request for a Bond
Alternatively, Appellants request that this Court require the Trustee to post a bond in an
amount at least equal to the amount of the GSA settlement funds allocated to the SAM
bankruptcy estate. Appellants contend that this is the only way to safeguard their rights if this
appeal is successful.
Appellees respond that the purpose of posting a bond during an appeal is to protect the
prevailing party in the underlying proceeding against any loss that might result from the stay.

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Given that Appellants were not the prevailing party in the underlying bankruptcy proceedings,
Appellees argue that there is no basis for requiring Appellees to post a bond for this appeal. This
Court agrees and denies Appellants’ request that the Trustee be required to post a bond.
DONE AND ORDERED at Tampa, Florida, this 12th day of November, 2014.

Copies to:
Counsel of Record

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