Herx v. Diocese of Fort Wayne-South Bend Inc et al
Filing
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OPINION AND ORDER DENYING AS MOOT 220 Motion to Stay proceedings pending disposition of its post-trial motions; DENIED without prejudice 252 Motion for Writ of execution; GRANTING 255 Motion to Stay enforcement of the judgment pending appeal and waive the bond requirement. The court further DIRECTS that the Diocese set aside funds sufficient to satisfy the $403,607.33 judgment, together with post-judgment interest through this date, plus an additional ten percent of the amount of t he judgment, in a restricted account to be used solely for that purpose. The Diocese is to establish that account within ten days of this date and file notice with the court and counsel for Mrs. Herx that it has done so. Signed by Judge Robert L Miller, Jr on 9/24/15. (mlc)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
EMILY HERX,
Plaintiff
vs.
DIOCESE OF FORT WAYNE –
SOUTH BEND, INC.,
Defendant
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CAUSE NO. 1:12-CV-122 RLM
OPINION and ORDER
Emily Herx has filed a motion for writ of execution of the August 6, 2015
judgment entered against the Diocese of Fort Wayne-South Bend, Inc. Mrs. Herx
asks that the Diocese be required to pay the total amount of the judgment, plus
post-judgment inte rest, or, if the Diocese has insufficient funds available, the
judgment be satisfied by the sale of Diocese property. In response, the Diocese
filed a notice of appeal and its requests that enforce me nt of the judgment be
stayed pending appeal and that it not be required to post a bond or other
security. Mrs. Herx objects to staying execution of judgment and to the Diocese’s
request that it be excused from posting a bond.
Federal Rule of Civil Procedure 62(d) provides that an appellant may obtain
a stay of the execution of a judgment by posting a bond. The Diocese has filed an
appeal and seeks a stay, but wants to be excused from the requirement of posting
a bond. In deciding whether the bond re quire ment of Rule 62(d) should be
waived, the court is to consider the following factors:
(1) the complexity of the collection process; (2) the amount of time
required to obtain a judgment after it is affirmed on appeal; (3) the
degree of confidence that the district court has in the availability of
funds to pay the judgment; (4) whether the defendant’s ability to pay
the judgment is so plain that the cost of a bond would be a waste of
money; and (5) whether the defendant is in such a precarious
financial situation that the requirement to post a bond would place
other creditors of the defendant in an insecure position.
Dillon v. City of Chicago, 866 F.2d 902, 904-905 (7th Cir. 1988) (internal
quotations and citations omitted). “Even when a notice of appeal is filed,
‘divest[ing] the district court of jurisdiction over any matters dealing with the
merits of the appeal, . . . the district court retains jurisdiction over any issues
relating to the enforcement of the judgment or the supersedeas bond.’” Press
Ganey Assocs., Inc. v. Dye, No. 3:12-CV-437, 2014 WL 1874897, at *1 (N.D. Ind.
May 8, 2014) (quoting Sheldon v. Munford, Inc., 128 F.R.D. 663, 665 (N.D. Ind.
1989)).
The Diocese has addressed the Dillon factors and maintains each factor
weighs in its favor. The Diocese first asserts that the court and Mrs. Herx need
not worry about the Diocese’s finances – assuming that Mrs. Herx ultimately
prevails, the Diocese would be able to issue payment to her in full at the
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conclusion of the appellate process. In support, the Diocese submits the affidavit
of Joseph G. Ryan, its Chief Financial Officer, who reports that the Diocese has
three funds with sufficient moneys available to satisfy any amount due to Mrs.
Herx. Mr. Ryan represents that the Diocese is solvent, meets its obligations when
they become due, has assets that greatly exceed its liabilities, and could pay any
financial obligation to Mrs. Herx within a period of thirty days. Mot. for Stay, Exh.
A (Ryan Aff.). The Diocese says its financial condition, as evidenced by Mr. Ryan’s
affidavit, demonstrates that posting a bond would a waste of money – Mrs. Herx’s
future ability to collect any amounts due to her from the Diocese isn’t being
endangered by the appeal. See Ryan Aff., ¶¶ 13-15. Lastly, the Diocese proposes
that because paying for a bond would divert funds away from the charitable and
pastoral mission of the Diocese, the court should consider requiring the Diocese
to segregate moneys to cover the amount of the judgment and post-judgment
interest into a separate, restricted fund. See also Ryan Aff., ¶ 9.
Mrs. Herx objects to the Diocese’s request for a stay and a waiver of the
bond requirement, but says that requiring the Diocese to segregate sufficie nt
funds to protect her “judgment and anticipated award of fees, expenses, and costs
into a separate and restricted account would be preferable to requiring no action
by the Diocese to preserve and protect the amounts at issue.” Resp., at 6-7. Mrs.
Herx says that if the Diocese is permitted to create a separate account, the funds
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paid into that account should be in an amount sufficient to cover the judgment,
post-judgment interest, attorneys’ fees, costs, and expenses, which Mrs. Herx
says may total $1.2 million or more.
Waiver of the bond requirement “is appropriate only if the appellant has a
clearly demonstrated ability to satisfy the judgment in the event the appeal is
unsuccessful and there is no other conce rn that the appellee’s rights will be
compromised by a failure adequately to secure the judgment.” In re Carlson, 224
F.3d 716, 719 (7th Cir. 2000). Based on the evidence submitted by the Diocese
through the affidavit of CFO Ryan, the court finds that the Diocese has
demonstrated its ability to satisfy the judgment and other amounts that may
become due in this case. The court will waive the bond requirement and adopt
the Diocese’s proposed alternative that it set aside funds to satisfy the judgment.
Because the issue of attorneys’ fees, expenses, and costs hasn’t been finalized,
the court believes that estimating an appropriate amount to be set aside for those
claims is premature.
Based on the foregoing, the court
(a) DENIES as moot the Diocese’s motion to stay proceedings
pending disposition of its post-trial motions [docket # 220];
(b) DENIES without prejudice Mrs. Herx’s motion for writ of
execution [docket # 252]; and
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(c) GRANTS the Diocese’s motion to stay enforcement of the
judgment pending appeal and waive the bond requirement [docket
# 255].
The court further DIRECTS that the Diocese set aside funds sufficient to
satisfy the $403,607.33 judgment, together with post-judgment interest through
this date, plus an additional ten pe rce nt of the amount of the judgment, in a
restricted account to be used solely for that purpose. The Diocese is to establish
that account within ten days of this date and file notice with the court and
counsel for Mrs. Herx that it has done so.
SO ORDERED.
ENTERED:
September 24, 2015
/s/ Robert L. Miller Jr.
Judge, United States District Court
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