United States District Court, D. Maryland
Richard D. Bennett United States District Judge
Memorandum Order addresses defendant-appellant Philip G.
Heasley's Motion for Supersedeas or, in the Alternative,
Stay of Final Judgment Pending Appeal (“Heasley's
Motion”). (ECF No. 159.) The parties' submissions
have been reviewed, and no hearing is necessary. See
Local Rule 105.6 (D. Md. 2016.) For the reasons stated below,
Heasley's Motion will be GRANTED IN PART and DENIED IN
PART. Specifically, the Motion will be GRANTED insofar as
execution of this Court's Judgment shall be STAYED, and
the Interpleaded Prize Money (ECF No. 45) shall remain in the
Court's Registry pending the resolution of his appeal.
Heasley's Motion will be DENIED insofar as he requests
that no supersedeas bond be required; Heasley SHALL POST a
supersedeas bond with this Court in the amount of
$281, 866.00 within fourteen (14) days of
this Memorandum Order.
10, 2017, this Court entered a Final Judgment
(“Judgment”) (ECF No. 155) which: (1) declared
that defendant Philip Heasley is not entitled to any
distribution of the Interpleaded Prize Money; (2) entered
judgment in favor of plaintiff White Marlin Open, Inc., on
defendant Heasley's Counterclaims (ECF No. 95); (3)
dismissed with prejudice any pending crossclaims; and (4)
provided a formula for the distribution of the Interpleaded
Prize Money (ECF No. 45) based on the prevailing parties'
June 30, 2017 Status Report (ECF No. 154). The Judgment
further provided that the Interpleaded Prize Money and
accrued interest would be distributed not less than thirty
(30) days after the date of the Judgment.
August 2, 2017, Heasley noted an appeal from this Court's
Judgment and from all of the pretrial Memorandum Opinions and
Orders entered in this case. (ECF No. 156.) On August 7,
2017, Heasley filed his now-pending Motion for Supersedeas.
(ECF No. 159.)
62(d) of the Federal Rules of Civil Procedure provides that,
“[i]f an appeal is taken, the appellant may obtain a
stay by supersedeas bond…The bond may be given upon or
after filing the notice of appeal or after obtaining the
order allowing the appeal. The stay takes effect when the
court approves the bond.” Fed.R.Civ.P. 62(d). Local
Rule 110 of this Court provides that, “[u]nless
otherwise ordered by the Court, the amount of any supersedeas
bond filed to stay execution of a money judgment pending
appeal shall be 120% of the amount of the judgment plus an
additional $500 to cover costs on appeal.” Loc. R.
110.1(a) (D. Md. 2016). “This procedure has been
interpreted to guarantee a defendant a stay of the whole
judgment ‘as a matter of right.'” RG
Steel Sparrows Point, LLC v. Kinder Morgan Bulk Terminals,
Inc., WMN-09-1668, 2014 WL 5293682, at *1 (D. Md. Oct.
14, 2014). However, “[i]t is the appellant's burden
to demonstrate objectively that posting a full bond is
impossible or impractical; likewise, it is the
appellant's duty to propose a plan that will provide
adequate (or as adequate as possible) security for the
appellee.” United States v. Kurtz, 528 F.Supp.
1113, 1115 (E.D. Pa. 1981), aff'd., 688 F.2d 827
(3d Cir.), cert. denied, 459 U.S. 991, 103 S.Ct. 347
(1982). See also Lamon v. City of Shawnee, Kan., 758
F.Supp. 654, 656 (D. Kan. 1991) (“the purpose of
posting supersedeas bonds is to ensure that the judgment
creditor is secured from losses which may result from a
within this Court's inherent power “to determine
the amount of a supersedeas bond or to permit other forms of
security for monetary judgments on appeal.” Cross
v. Fleet Reserve Ass'n Pension Plan,
WDQ-05-0001, 2007 WL 7143977, at *3 (D. Md. Feb. 27, 2007).
“[F]ormer Rule 73(d) described what always has been
good practice on a supersedeas bond, and, except as the
matter now is regulated by local rules in a particular
district, it is still a useful guide on these matters.”
Charles Alan Wright & Arthur R. Miller, 11 Fed. Prac.
& Proc. Civ. § 2905 (3d ed.). Former Rule 73(d)
Whenever an appellant entitled thereto desires a stay on
appeal, he may present to the court for its approval a
supersedeas bond which shall have such surety or sureties as
the court requires. The bond shall be conditioned for
the satisfaction of the judgment in full together with costs,
interest, and damages for delay, if for any reason
the appeal is dismissed or if the judgment is affirmed, and
to satisfy in full such modification of the judgment and such
costs, interest, and damages as the appellate court may
adjudge and award.
Fed. R. Civ. P. 73(d) (rescinded 1968). See Tennessee
Valley Auth. v. Atlas Mach. & Iron Works,
Inc., 803 F.2d 794, 799 (4th Cir. 1986) (same).
noted above, this Court has described a defendant's
ability to stay the execution of a money judgment pending
appeal as a “matter of right.” RG Steel,
2014 WL 5293682, at *1.
instant case presents no reason to depart from this
Court's well-established practice of imposing a stay of
execution upon the posting of a supersedeas bond. Thus,
execution of this Court's July 10, 2017 Judgment shall be
STAYED pending the issuance of a Mandate from the United
States Court of Appeals for the Fourth Circuit.
with the foregoing, Heasley shall be required to post a
supersedeas bond. While Heasley argues that no bond is
required because the funds in dispute in this interpleader
action have been deposited with the Court and “are
currently drawing interest in an interest-bearing account,
” his position is not entirely persuasive. (ECF No. 159
at 3.) Insofar as the Interpleaded Funds remain within this
Court's Registry and Heasley is not personally liable for
this amount, these funds do limit the rationale behind the
posting of a supersedeas bond. However, to the extent that
the stay significantly limits the prevailing parties'
ability to earn interest on the funds and subjects them to
additional expenses related to this litigation, this Court is
not satisfied that the interpleaded funds alone provide
adequate security, including “damages for delay,
” to the prevailing parties. See ECF No. 161
at 5-7. Although the less than 1% interest rate accruing to
the Interpleaded Funds in the Court's Registry is similar
to what one might earn depositing the money in some savings
accounts, it is well below the over 4% interest rate charged
on many consumer loans,  and even further below the over 10%
returns seen on major stock indices over the past year. Notably,
as prevailing plaintiffs Kosztyu and Hutchison note, the 1%
interest rate is also far less than the interest rates
charged on several outstanding invoices incurred litigating
this case. (ECF No. 161 ...