Gibson et al v. Credit Suisse Securities USA, LLC et al

Filing 567

MEMORANDUM DECISION & ORDER The Motion to Stay (Dkt. 535 ) is GRANTED as follows: 1) The Order on Sanctions (Dkt. 531 ) is STAYED. 2) The Plaintiffs shall notify the Court within 5 days of the Ninth Circuit ruling on their Appeal and Petition for W rit of Mandamus. 3) The Motions for Attorney Fees (Dkt. 551 , 552 ) and remaining briefing deadlines on those Motions are STAYED. Signed by Judge Edward J. Lodge. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by (jp)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO

L.J. GIBSON, BEAU BLIXSETH; AMY KOENIG,
VERN JENNINGS, MARK MUSHKIN,
MONIQUE LEFLEUR, and GRIFFEN
DEVELOPMENT, LLC, JUDY LAND, and
CHARLES DOMINGUEZ each individually, and
on behalf of other similarly situated,

Case No.: 1:10-cv-00001–JLQ
MEMORANDUM DECISION AND
ORDER ON REFERRED MOTION

Plaintiffs,
vs.
CREDIT SUISSE AG, a Swiss corporation;
CREDIT SUISSE SECURITIES (USA), LLC, a
Delaware limited liability company, CREDIT
SUISSE FIRST BOSTON, a Delaware limited
liability corporation; CREDIT SUISSE CAYMAN
ISLAND BRANCH, an entity of unknown type;
CUSHMAN & WAKEFIELD, INC., a Delaware
corporation and DOES 1 through 100 inclusive,
Defendants.

Before the Court in the above-entitled matter is Plaintiffs' Motion for Stay of Order
on Sanctions Pending Appeal. (Dkt. 535.) The Plaintiffs seek a stay of this Court’s Order
affirming and adopting the Magistrate Judge’s Order imposing sanctions in this case. (Dkt.
531, 352.) The parties have filed their responsive briefing and the matter is ripe for the
Court’s consideration. Having fully reviewed the record herein, the Court finds that the facts
and legal arguments are adequately presented in the briefs and record. Accordingly, in the
interest of avoiding further delay, and because the Court conclusively finds that the

MEMORANDUM DECISION AND ORDER - 1

decisional process would not be significantly aided by oral argument, this Motion shall be
decided on the record before this Court without oral argument.
Standard of Review
In considering a motion to stay pending appeal, the factors regulating the issuance of
a stay are: (1) whether the stay applicant has made a strong showing that he is likely to
succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3)
whether issuance of the stay will substantially injure the other parties interested in the
proceeding; and (4) where the public interest lies." Hilton v. Braunskill, 481 U.S. 770, 776
(1987); see also Nken v. Holder, 556 U.S. 418, 433 (2009). The first two factors are the
“most critical.” Nken, 556 U.S. at 434.
As to the first factor, the Ninth Circuit has characterized a “strong showing” to include
“reasonable probability,” “fair prospect,” “substantial case on the merits,” and “serious legal
questions ... raised.” Leiva–Perez v. Holder, 640 F.3d 962, 967–68 (9th Cir. 2011). These are
“largely interchangeable” descriptions which each require the movant to show that “at a
minimum...that there is a substantial case for relief on the merits.” Lair, 697 F.3d at 1204;
Leiva–Perez, 640 F.3d at 967–68. In regards to the second factor, the movant must
demonstrate that there is a probability that he or she will suffer an irreparable injury if the
stay is not granted. Lair, 697 F.3d at 1215; Leiva–Perez, 640 F.3d at 969.
“A stay is not a matter of right, even if irreparable injury might otherwise result,”
rather, a stay is “an exercise of judicial discretion” and the “propriety of its issue is
dependent upon the circumstances of the particular case.” Nken, 556 U.S. at 433-34 (2009);
MEMORANDUM DECISION AND ORDER - 2

Lair, 697 F.3d at 1203. “The party requesting a stay bears the burden of showing that the
circumstances justify an exercise of that discretion.” Id.
Discussion
The Motion to Stay reasserts the same arguments raised by Plaintiffs in their filings
concerning the Motion for Sanctions which this Court has previously considered and ruled
upon. In particular, Plaintiffs argue they have a substantial likelihood of success on the merits
of their claims and will suffer irreparable injury absent a stay. (Dkt. 535.) Defendants argue
the Plaintiffs have mischaracterized the facts and they have failed to show a likelihood of
success on the merits. (Dkt. 549.) Defendants further assert the sanctions were warranted and
proper and that Plaintiffs were afforded more than adequate due process. (Dkt. 549.) In reply,
the Plaintiffs challenge the Defendants’ recitation of the record and adhere to their claim that
they are likely to succeed on appeal. (Dkt. 554.)
The Plaintiffs’ arguments concerning the first factor, the likelihood of success on the
merits, are a recitation of the same arguments raised in the many prior filings made
concerning the sanctions Motion. The Court has again reviewed those same arguments and,
for the reasons stated in its Order affirming the Magistrate Judge’s ruling imposing sanctions,
which are specifically referenced and incorporated herein, the Court finds the Plaintiffs have
failed to demonstrate a strong likelihood of success on the merits of their appeal. (Dkt. 352.)

MEMORANDUM DECISION AND ORDER - 3

As to the remaining factors, Plaintiffs argue they will suffer irreparable injury, the
balance of the equities tip in their favor as Defendants will not suffer substantial harm, and
the public interest favors entering a stay. (Dkt. 535.) The irreparable injury Plaintiffs’ counsel
allege they will suffer is the professional stigma sanctioned attorneys are subject and the
possibility of investigations, inquiries, and possible disciplinary action by the many relevant
bar jurisdictions concerning possible ethical violations. (Dkt. 535 at 9-10.) The Court agrees
the probable injury to counsels’ professional reputation is irreparable and potentially
significant. As to the remaining factors, the Court finds the Defendants will suffer no damage
if the stay is granted and the public interests weighs in favor of granting the stay.
Based on the foregoing, the Court will grant the Motion for Stay Pending Appeal.
Although the Plaintiffs have failed to identify a strong likelihood of success on the merits,
the remaining factors weigh in favor of granting the stay. The Court finds the potential injury
that counsel for Plaintiffs face from the sanctions Order is irreparable and that the remaining
factors also weigh in favor of granting the stay. Accordingly, the Court will grant the Motion
to Stay the Sanctions Order Pending Appeal. The Court will also order that the two pending
Motions for Attorney Fees, and the remaining briefing deadlines for those Motions, that
relate to the Sanctions Order are also stayed pending the Ninth Circuit’s ruling on the appeal
filed in this case. (Dkt. 551, 552.) Counsel for Plaintiffs is directed to notify this Court within
five days of the Ninth Circuit issuing its ruling on their Petition for Writ of Mandamus.

MEMORANDUM DECISION AND ORDER - 4

ORDER
NOW THEREFORE IT IS HEREBY ORDERED that the Motion to Stay (Dkt.
535) is GRANTED as follows:
1)

The Order on Sanctions (Dkt. 531) is STAYED.

2)

The Plaintiffs shall notify the Court within five (5) days of the Ninth Circuit
ruling on their Appeal and Petition for Writ of Mandamus.

3)

The Motions for Attorney Fees (Dkt. 551, 552) and remaining briefing
deadlines on those Motions are STAYED.

DATED: January 7, 2015

Honorable Edward J. Lodge
U. S. District Judge

MEMORANDUM DECISION AND ORDER - 5