INGENIERA, MAQUINARIA Y EQUIPOS DE COLOMBIA S.A. v. ATTS, INC.

Filing 34

MEMORANDUM OPINION. Signed by Judge Jerome B. Simandle on 4/9/2018. (dmr)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

INGENIERIA, MAQUINARIA Y
EQUIPOS DE COLOMBIA S.A.,
Petitioner,

HONORABLE JEROME B. SIMANDLE

Civil Action No.
17-3624 (JBS/JS)

v.
AVIATION TECHNOLOGY & TURBINE
SERVICE, INC.,

MEMORANDUM OPINION

Respondent.

SIMANDLE, District Judge:
This matter comes before the Court on Respondent Aviation
Technology & Turbine Service, Inc.’s (“ATTS”) motion to stay
execution on the judgment in this matter pending appeal without
being required to post a supersedeas bond or, in the
alternative, for approval of a supersedeas bond. [Docket Item
26.] For the reasons set forth below, the motion will be granted
in part and denied in part; the Court will grant a stay of the
execution of judgment, but will deny ATTS’s request to waive the
supersedeas bond. Bond will be set at $289,659.00, the amount
awarded in favor of Petitioner Ingenieria, Maquinaria Y Equipos
de Colombia S.A. (“IMECOL”) by the Colombian arbitration panel
and confirmed by this Court. The Court finds as follows:
1.

IMECOL and ATTS were parties to a three-year exclusive

agency agreement regarding the sale of commercial equipment in

Colombia. After ATTS failed to make commission payments to
IMECOL, IMECOL initiated proceedings against ATTS before a
Colombian arbitration panel pursuant to an arbitration clause in
the agency agreement. ATTS conceded it was notified of the
arbitration proceedings, but opted not to participate.
Ultimately, the arbitrators found in IMECOL’s favor and
determined that ATTS and a Colombian subsidiary, ATTS Energía,
were jointly and severally liable to IMECOL for $289,659.00.
2.

On December 8, 2017, the Court confirmed the Colombian

arbitration award. [Docket Item 23.] ATTS has appealed that
decision [Docket Item 24], and now asks this Court to stay
execution on the $289,659.00 judgment pending appeal and waive
the supersedeas bond requirement or, in the alternative, to
approve a supersedeas bond pursuant to Fed. R. Civ. P. 62(d).
[Docket Item 26.] IMECOL opposes this motion. [Docket Item 27.]
3.

Under Federal Rule of Civil Procedure 62(d), an

appellant may obtain a stay by supersedeas bond1 after filing a
notice of appeal on the docket. The appellant is “entitled to a
stay of a money judgment as a matter of right if he posts a

1

“A supersedeas bond is any form of security, whether in the
form of cash, property, or surety bond, which a court may
require of one who petitions to set aside a judgment or
execution and from which the other party may be made whole if
the action is unsuccessful.” United States ex rel. Doe v. Heart
Sol. PC, 2017 WL 2709561, at *1 (D.N.J. June 23, 2017) (quoting
Hilburn v. Bayonne Parking Auth., 2013 WL 1721648, at *2 (D.N.J.
Apr. 19, 2013)).
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[supersedeas] bond in accordance with [Rule] 62(d).” Pharmacia
Corp. v. Motor Carrier Serv. Corp., 2008 WL 852255, at *4
(D.N.J. Mar. 28, 2008) (quoting American Mfrs. Mut. Ins. Co. v.
Am. Broadcasting-Paramount Theatres, Inc., 87 S. Ct. 1, 3
(1966)). “In order to make the other party whole, such a
supersedeas bond must normally be in a sum sufficient to pay the
judgment and costs, interest, and damages for delay.” Pharmacia
Corp., 2008 WL 852255, at *4.
4.

“Although the Third Circuit is silent on the issue of

whether courts may require a bond less than the amount of the
full judgment, district courts within the Third Circuit have
found that they have discretion under Rule 62(d) to waive the
bond requirement in whole or in part.” Montalvo v. Larchmont
Farms, Inc., 2011 WL 6303247, at *1 (D.N.J. Dec. 15, 2011)
(citing Church & Dwight Co. v. Abbott Labs., 2009 WL 2230941, at
*14 (D.N.J. July 23, 2009)). Courts exercise this discretion
“where there exists an alternative means of securing the
judgment” and there are “exceptional circumstances.” Montalvo,
2011 WL 6303247 at *1 (citing Transamerica Occidental Life Ins.
v. Total Systems, Inc., 2011 WL 2447520, at *2 (D.N.J. July 23,
2009; Church & Dwight Co., 2009 WL 2230941, at *14).
5.

In determining whether “exceptional circumstances”

exist, courts in this District consider the so-called Dillon
factors, which are:
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(1)

[T]he complexity of the collection process;

(2)

[T]he amount of time required to obtain a judgment
on appeal;

(3)

[T]the degree of confidence that the district court
has in the availability of funds to pay the
judgment;

(4)

[W]hether 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)

[W]hether the defendant is in such a precarious
financial situation that the requirement to post a
bond would place the other creditors of the debtor
in an insecure position.

Hurley v. Atlantic City Police Dept., 944 F. Supp. 371, 374
(D.N.J. 1996) (citing Dillon v. City of Chicago, 866 F.2d 902,
904-05 (7th Cir. 1988)). Additionally, “it is the appellant's
burden to demonstrate objectively that posting a full bond is
impossible or impracticable; likewise it is the appellant's duty
to propose a plan that will provide adequate (or as adequate as
possible) security for the appellee.” Hilburn, 2013 WL 1721648,
at *2 (quoting AMG Nat’l Trust Bank v. Ries, 2008 WL 2312532, at
*1 (E.D. Pa. June 4, 2008)).
6.

Here, ATTS addresses some of the five Dillon factors

articulated above. Specifically, ATTS avers that it’s “financial
strength and ability to satisfy the Judgment are strong,” and
that “the company is capable of expeditiously satisfying the
Judgment using its own financial resources.” (Resp. Br. at 2;
Khan Decl. at ¶¶ 4-5.) Furthermore, ATTS “assures [the Court]
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that it will be able to pay the Judgment should it become final
and unappealable,” and that “ATTS could wire the full amount of
the Judgment and any post-judgment interest of other costs
associated therewith to an appropriate account held by plaintiff
within ten (10) business days.” (Resp. Br. at 3; Khan Decl. at
¶¶ 6-7.) Because ATTS is “fully able to satisfy the Judgment at
such time as its appeals are exhausted,” ATTS reasons that “a
supersedeas bond is not necessary in this matter.” (Resp. Br. at
3.)
7.

IMECOL, in turn, maintains that ATTS “addresses the

Dillon factors only briefly, providing no compelling reason to
waive the bond requirement,” which is “not sufficient.” (Pet.
Br. at 9.) To that end, IMECOL argues, “[n]ot only has
Respondent not provided corroborating evidence of its ability to
pay, such as bank records or other proof of funds, but
Respondent has also failed to explain why [the] five Dillon
factors weigh in its favor.” (Id. at 10.) IMECOL further argues
that, “[e]ven if Respondent had offered evidence to show the
Dillon factors weigh in its favor, Respondent fails to offer any
alternative means for securing its judgment,” such as a
supersedeas bond. (Id. at 10-11.)
8.

The Court concludes that the supersedeas bond

requirement should not be waived in this instance. First, ATTS
has not adequately explained why all five of the Dillon factors
5

weigh in its favor. For example, ATTS has not put forth any
evidence regarding the complexity of the collection process (the
first Dillon factor) or the amount of time required to obtain a
judgment on appeal (the second Dillon factor). In fact, ATTS has
only really demonstrated that it is financially secure at the
moment and is currently able to pay the judgment. (See Khan
Decl. at ¶¶ 6-7.) These, the Court finds, fall well short of
“extraordinary circumstances.” Accord Heart Sol. PC, 2017 WL
2709561, at *2 (court refuses to waive supersedeas bond
requirement where appellant failed to adequately address all
five Dillon factors); Hilburn, 2013 WL 1721648, at *3 (same);
Montalvo, 2011 WL 6303247 at *2 (same); Church & Dwight Co.,
2009 WL 2230941, at *16 (same); Transamerica Occidental Life
Ins., 2011 WL 2447520, at *3 (same); Leff v. First Horizon Home
Loan, 2007 WL 2572362, at *7 (D.N.J. Sept. 4, 2007) (same).
Second, ATTS has not offered any alternative means for securing
its judgment or argued that the bond requirement is “impossible
or impracticable.” Hilburn, 2013 WL 1721648, at *3. Accordingly,
the Court will require ATTS to file a supersedeas bond to stay
this judgment pending appeal and ATTS will, therefore, be
“entitled to a stay of a money judgment as a matter of right.”
Pharmacia Corp., 2008 WL 852255, at *4.
9.

For the foregoing reasons, ATTS’s motion will be

granted in part and denied in part. The Court will grant the
6

stay of execution and will set bond at $289,659.00, the amount
awarded in favor of IMECOL by the Colombian arbitration panel
and confirmed by this Court. This amount, the Court finds, is “a
sum sufficient to pay the judgment and costs, interest, and
damages for delay.” Pharmacia Corp., 2008 WL 952255, at *4. An
accompanying Order will be entered.

April 9, 2018
Date

s/ Jerome B. Simandle
JEROME B. SIMANDLE
U.S. District Judge

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