Madison Oslin Inc v. Interstate Resources, Inc. et al

Filing 180

MEMORANDUM AND ORDER Re: Fees Bond. Signed by Judge Marvin J. Garbis on 4/1/2016. (bmhs, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
MADISON OSLIN, INC.,
et al.,
Plaintiffs
vs.
INTERSTATE RESOURCES, INC.,
et al.,
Defendants
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CIVIL ACTION NO. MJG-12-3041

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MEMORANDUM AND ORDER RE: FEES BOND

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The Court has before it Defendants’ Motion to Require
Plaintiffs to Post a Security for Costs and Attorneys [sic] Fees
[ECF No. 143] and the materials submitted relating thereto.

The

Court finds no need for a hearing.
Defendants have incurred substantial legal fees defending
against meritless claims presented by Plaintiffs.

They allege

that the total fees incurred prior to post-trial and appellate
proceedings are in excess of $3.4 million.
No. 157.

Defs.’ Notice 2, ECF

Plaintiffs further estimate that they will incur some

$128,050 of costs and fees on appeal.
By the instant motion,1 Defendants seek to have the Court
require Plaintiffs to post security of $1,000,0002 with regard to

1

As supplemented. See Defs.’ Notice 2, ECF No. 157.
That is, $250,000 per defendant, an amount that defendants
contend is the absolute minimum possible legal fee award.
2

the legal fees and an additional amount in regard to the
anticipated cost of appeal.

I.

DISCUSSION
A.

The Alabama Trade Secrets Act (“ATSA”) Fee Award

By the Memorandum and Order Re: Bond [ECF No. 151] and the
Order to Post Security [ECF No. 176], the Court required
Plaintiffs to post security for costs awarded regarding district
court proceedings.

However, "the [Alabama] Trade Secrets Act

does not award attorneys' fees to the prevailing party as part
of costs; rather, it makes attorneys' fees an additional penalty
for willful misappropriation."

Util. Automation 2000, Inc. v.

Choctawhatchee Elec. Co-op., Inc., 298 F.3d 1238, 1245 (11th
Cir. 2002).

Accordingly, the Court shall not treat the ATSA

attorney fee award as one for costs and shall not require
security to be posted.
Were the Court to determine the amount of the ATSA fee
award it could enter a Judgment or Supplemental Judgment
requiring payment by Plaintiffs.

Should that occur, Plaintiffs

may be required to post a supersedeas bond3 to avoid immediate
collection efforts.

3

A supersedeas bond sometimes must be filed to obtain a stay
of execution of a judgment pending an appeal. History and
Application of Rule 7, 16A Fed. Prac. & Proc. Juris § 3953 (4th

2

Plaintiffs state that there would be a substantial cost to
establishing the amount of the legal fee award.
doubt, true.

That is, no

However, Defendants have not provided authority

that would permit the Court to issue a Judgment requiring
Plaintiffs to pay legal fees in an amount to be determined at
some future time.

B.

Rule 7 Costs

Rule 7 of the Federal Rules of Appellate Procedure provides
in pertinent part:
In a civil case, the district court may
require an appellant to file a bond or
provide other security in any form and
amount necessary to ensure payment of costs
on appeal.
The costs for which a Rule 7 bond can be required include
those costs relating to the appeal.

See, e.g., United States,

for Use of Terry Inv. Co. v. United Funding and Inv’rs, Inc.,
800 F. Supp. 879, 882 (E.D. Cal. 1992)(“Rule 7 bonds are to be
strictly limited to the costs of filing and proceeding with a
case in the court of appeals.”); Young v. New Process Steel, LP,
419 F.3d 1201, 1207-08 (11th Cir. 2005)(holding that a district
court had the discretion to require an unsuccessful plaintiff to
post a bond in the amount of the defendant’s anticipated costs

ed.)

3

upon a finding that the appeal is likely to be frivolous,
unreasonable, or without foundation).
Defendants have estimated they will incur a total of
$128,050 in costs and fees on appeal.

Defendants’ Motion to

Require Plaintiffs to Post a Security for Costs and Attorneys
[sic] Fees, ECF No. 143.

Defendants have not, however,

specified what portion of the total constitutes costs rather
than anticipated attorneys’ fees.

Accordingly, the Court has no

basis upon which to apply Rule 7.

II.

CONCLUSION
For the foregoing reasons, Defendants’ Motion to Require

Plaintiffs to Post a Security for Costs and Attorneys [sic] Fees
[ECF No. 143] is DENIED except to the extent GRANTED by
Memorandum and Order Re: Bond [ECF No. 151].

SO ORDERED, on Friday, April 1, 2016.

/s/__________
Marvin J. Garbis
United States District Judge

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