JPMorgan Chase Bank, N.A. v. Winget et al

Filing 679

MEMORANDUM AND ORDER DENYING LARRY J. WINGETS MOTION FOR STAY WITHOUT BOND PENDING RESOLUTION OF WINGETS MOTION FOR PARTIAL SATISFACTION OF JUDGMENT (Doc. 675). Signed by District Judge Avern Cohn. (MVer)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

JPMORGAN CHASE BANK, N.A.,
Plaintiff/
Counter-Defendant,

Case No. 08-13845

v.
HON. AVERN COHN
LARRY J. WINGET and the
LARRY J. WINGET LIVING TRUST,
Defendants/
Counter-Plaintiffs.
__________________________________/
MEMORANDUM AND ORDER DENYING LARRY J. WINGET’S’ MOTION FOR STAY
WITHOUT BOND PENDING RESOLUTION OF WINGET’S MOTION FOR PARTIAL
SATISFACTION OF JUDGMENT (Doc. 675)1
I.
This is a commercial dispute. J. P. Morgan Chase (Chase) is the administrative
agent for a group of lenders that extended credit to Venture Holdings Company, LLC
(Venture) under a credit agreement. In the complaint (Doc. 1), Chase sued Larry J.
Winget (Winget) and the Larry J. Winget Living Trust (Trust) to enforce a Guaranty and
two (2) Pledge Agreements entered into by Winget and signed by Winget and the
Winget Trust in 2002, guaranteeing the obligations of Venture.
The Court entered an Amended Final Judgment, Doc. 568, entering a judgment
against Winget and the Winget Trust in the amount of $425,113,115.59 but limiting
Chase’s recourse as to Winget as to $50 million. After entry, Chase began collection
1

Upon review of the parties’ papers, the Court deems this matter appropriate for
decision without oral argument. See Fed. R. Civ. P. 78(b); E.D. Mich. LR 7.1(f)(2).

efforts, including issuing writs of garnishment and serving discovery on Winget and the
Trust. The Court also issued an order awarding Chase $11,154,874.65 in attorney fees
and expenses (Fee Order) associated with its efforts to enforce the Guaranty and
Pledge Agreements. (Doc. 671). Winget has separately moved for partial satisfaction
of the judgment, asking that the Court declare the Fee Order “and that portion of the
Amended Final Judgment (Doc. 568) which the [Fee] Order animates, satisfied.” (Doc.
672).
Before the Court is Winget’s motion to stay enforcement of the Fee Order until
three (3) business days after the Court resolves Winget’s motion for partial satisfaction
of the judgment. (Doc. 675). For the reasons that follow, the motion is DENIED.
II.
Under Rule 62(b), a district court has the authority to stay the execution of a
judgment while a motion under Rule 60 is pending. Fed. R. Civ. P. 62(b)(4). In
determining whether a stay is appropriate under the circumstances, courts consider a
set of four factors, including: “(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.” Contract
Design Grp., Inc. v. Wayne State Univ., No. 10-cv-14702, 2014 WL 2892513, at *1 (E.D.
Mich. June 25, 2014) (internal citation omitted); see also AIA Eng’g Ltd. v. Magotteaux
Int’l S/A, No. 09-cv-00255, 2012 WL 3745625, at *1 (M.D. Tenn. Aug. 28, 2012)
(applying the same standard); Covertech Fabricating, Inc. v. TVM Bldg. Prods., Inc., No.
13-cv-00150, 2015 WL 7348551, at *2 (W.D. Penn. Nov. 18, 2015) (same); SEC v.

Retail Pro, Inc., No. 08-cv-01620, 2011 WL 3515910, at *2 (S.D. Cal. Aug. 11, 2011)
(same).2
The stay must be “on appropriate terms for the other party’s security,” and what
is appropriate terms is within the court’s discretion. See Fed. R. Civ. P. 62(b); Lewis v.
United Joint Venture, No. 07-369, 2009 WL 1654600 at *1 (W.D. Mich. June 10, 2009).
There is a presumption in favor of requiring a bond if the court grants the stay,
but a court can forgo the bond in a limited set of circumstances. Newburgh/Six Mile Lit.
Partnership II v. Adlab Films USA, Inc., No. 09-cv-11067, 2010 WL 3167393, at 1 (E.D.
Mich. Aug. 9, 2010). The party seeking an unsecured stay bears the burden of
demonstrating “affirmatively that posting a bond or otherwise providing a security is
impossible or impractical.” Slip N’ Slide Records, Inc. v. TVT Records, LLC, No.
05-21113, 2007 WL 1098751, at *2 (citing Int’l Wood Processors v. Power Dry, Inc., 102
F.R.D. 212, 214 (D.S.C. 1984)). If there is no security, the defendant must show that
the plaintiff has some protection against the risk that the defendant will not be able
satisfy the judgment after disposition of the post-trial motions. Id. The “purpose of Rule
62(b) is to preserve the status quo until disposition of the post-judgment motions.”
Poplar Grove Planting & Refining Co., Inc. v. Bache Halsey Stuart, Inc., 600 F.2d 1189,
1190-91 (5th Cir. 1979). Many courts analyzing motions under Rule 62(b) have looked
to the factors for waiver of a bond under Rule 62(d) when deciding whether to waive
Rule 62(b)’s bond requirement. Id. at 1191.

2

Chase is correct that Winget made no attempt to analyze these factors. Instead,
Winget suggests that these factors do not apply where a request is made for a stay
without bond. This is not correct. The decision of whether to grant a stay must be
made before a decision on whether to require a bond associated with the stay. The
factors are relevant to whether a stay should be granted in the first instance.

III.
As to the first factor, the Court must examine Winget’s 60(b)(5) motion. In the
motion, Winget seeks to discharge the approximately $11 million award of fees and
costs by arguing that it was already satisfied by his separate $50 million payment under
the Guaranty. As Chase notes, Winget has twice before advanced the same argument
that forms the basis for his Rule 60(b)(5) motion, and the Court has twice rejected it.
First, see Doc. 474, Winget’s Proposed Final Judgment at p. 5 (arguing that Winget’s
liability was limited to $50 million) and Doc. 488, Memorandum Regarding Final
Judgment. at p. 5–6. Second, see Doc. 569, Winget’s Response to Motion for Costs
and Expenses at p. 17 (arguing that Section 10 limited Winget’s liability for fees and
costs) and Doc. 671, Order Granting Fees and Costs. Under these circumstances,
Winget does not appear likely to succeed on the merits of his motion.
As to the second factor, Winget cannot demonstrate that he will suffer irreparable
harm if a stay is not granted. The judgment at issue is a money judgment for
approximately $11 million. Generally, “potential monetary damage does not constitute
irreparable harm.” Baker v. Adams Cnty./Ohio Valley Sch. Bd., 310 F.3d 927, 930 (6th
Cir. 2002) (evaluating a stay pending appeal). Moreover, Winget says that has the
“financial ability” to “fully satisfy” the $11 million judgment against him. (Doc. 675 at p. 4,
Doc. 678 at p. 3). Thus, it does not appear Winget will suffer irreparable harm if he is
required to satisfy the money judgment in the absence of a stay.
The third and fourth factors do not apply because there are no other parties to
the lawsuit and the case involves a matter of contract between private parties.
Considering all of the above, Winget has not demonstrated that he is entitled to a

stay pending resolution of his Rule 60(b) motion. Having determined a stay is not
appropriate, it is not necessary to consider whether to require a bond.
SO ORDERED.

S/Avern Cohn
AVERN COHN
UNITED STATES DISTRICT JUDGE
Dated: February 17, 2016
Detroit, Michigan