Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_12-cv-02119/USCOURTS-azd-2_12-cv-02119-9/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:2201 Declaratory Judgment (Insurance)

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Lexington Insurance Company,

Plaintiff/ 

Counterdefendant, 

v. 

Scott Homes Multifamily Incorporated, et 

al., 

Defendants/ 

Counterclaimants.

No. CV-12-02119-PHX-JAT

ORDER 

 Pending before the Court is Plaintiff/Counterdefendant Lexington Insurance 

Company (“Lexington”)’s Emergency Motion to Extend the Temporary Stay of 

Execution on the Judgment (First Request). (Doc. 487). Defendants/Counterclaimants 

Silverbell 290 L.P. (“Silverbell”) and Scott Homes Multifamily, Inc. (“Scott Homes”) 

filed a response. (Doc. 488). The Court now rules on the motion. 

I. Background 

 Lexington requests—on an emergency basis—that the Court extend the 14-day 

automatic temporary stay of execution on the judgment, which expires Friday, November 

13, 2015. (Doc. 487 at 1). Lexington contends that the Court should extend the 14-day 

temporary stay until the Court disposes of “Lexington’s forthcoming post-trial motions” 

that apparently could impact the calculation of the judgment as currently entered. (Id.) 

Assuming the Court was inclined to deny all of Lexington’s yet-to-be-filed motions, 

Lexington asserts that it will file a notice of appeal and obtain a stay by posting a 

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supersedeas bond. (Id. at 2–3). Therefore, Lexington explains that it needs additional time 

to: (1) perform an independent calculation of pre-judgment interest due to the Court’s 

“unclear” rulings, (2) secure a supersedeas bond, and (3) obtain judicial approval of the 

bond before filing a notice of appeal. (Id.) 

II. Legal Standard 

 This Court has summarized the relevant legal standard as follows: 

 Rule 62(b) of the Federal Rules of Civil Procedure allows a federal 

court to “stay the execution of a judgment” pending disposition of certain 

post-trial motions. Such a stay can only be granted “[o]n appropriate terms 

for the opposing party’s security.” Id. An unsecured stay is disfavored 

under Rule 62(b). See, e.g., Int’l Wood Processors v. Power Dry, Inc., 102 

F.R.D. 212, 214 (D. S.C.1984) (“Rule 62, taken in its entirety, indicates a 

policy against any unsecured stay of execution after the expiration of the 

time for filing a motion for a new trial.” (citing cases)). Nevertheless, while 

security should be provided “in normal circumstances,” a district court in 

its discretion may grant an unsecured stay in “unusual circumstances,” 

where the granting of such a stay will not “unduly endanger the judgment 

creditor’s interest in ultimate recovery.” Fed. Prescription Serv., Inc. v. Am. 

Pharm. Ass’n, 636 F.2d 755, 760–61 (D.C. Cir. 1980) (addressing stay 

pending appeal pursuant to Rule 62(d)); see also In re Combined Metals 

Reduction Co., 557 F.2d 179, 193 (9th Cir. 1977) (recognizing district 

court’s discretion to grant unsecured stay under Rule 62(d)). 

In re Apollo Grp., Inc. Sec. Litig., 2008 WL 410625, at *1 (D. Ariz. Feb. 13, 2008). The 

Court also included a footnote that explained: 

Some courts have held that an unsecured stay should only be granted when 

the judgment debtor demonstrates that providing security is “impossible or 

impractical.” E.g., Int’l Wood Processors, 102 F.R.D. at 214; Gallatin 

Fuels v. Westchester Fire Ins. Co., No. 02–CV–2116, 2006 WL 952203, at 

*2 (W.D. Pa. 2006); Frankel v. ICD Holdings S.A., 168 F.R.D. 19, 22 

(S.D.N.Y. 1996). The Court, however, does not find these authorities 

persuasive. Such a standard would be more restrictive than the standard 

applied to unsecured stays pending appeal under Rule 62(d). Cf. Fed. 

Prescription, 636 F.2d at 759 (focusing on the judgment debtor’s financial 

condition as a factor that can weigh in favor of granting an unsecured stay). 

If anything, due to the greater risk inherent in the longer stay under Rule 

62(d), the standard governing the court’s discretion in the Rule 62(b) 

context should be less restrictive. 

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Id. at *1, n.1. 

III. Analysis 

 Initially, Lexington’s motion does not suggest whether it seeks a secured or an 

unsecured stay of execution of the judgment. See (Doc. 487). As nothing is before the 

Court evidencing Lexington’s financial ability or intent to provide a secured stay, the 

Court assumes Lexington seeks to extend the current stay of execution of the judgment 

on an unsecured basis. 

 In this regard, Lexington has not convinced the Court that this case presents 

“unusual circumstances,” nor has Lexington provided any information to show that 

Defendants/Counterclaimants’ interests will be adequately protected in the absence of 

security. Lexington did not offer the Court any evidence of its financial condition or other 

evidence showing its ability to pay the judgment pending resolution of its “forthcoming 

post-trial motions.” Moreover, Lexington’s assertion that it will file the motions 

enumerated in Rule 62(b) at some future time possibly makes the present motion 

premature. Rule 62(b) permits a court to stay the execution of a judgment pending the 

disposition of motions filed under Rule 50, 52(b), 59, and 60. For Rule 62(b) to apply, 

however, it is presumed that such motions have been filed by the requesting party. Here, 

there is arguably no basis for the Court to extend the current stay of execution of the 

judgment pursuant to Rule 62(b) because Lexington has not yet filed any post-trial 

motions. 

 Nevertheless, if Lexington wishes to extend the automatic stay of execution of the 

judgment until the Court disposes of its “forthcoming post-trial motions,” the Court will 

permit it to do so—contingent upon Lexington’s provision of adequate security to protect 

Defendants/Counterclaimants’ interests. As to the question of how much security 

Lexington will be required to provide, this Court has stated: 

The purpose of security under Rule 62(b) is to preserve the status quo 

pending disposition of post-trial motions. Int’l Wood Processors, 102 

F.R.D. at 215. Accordingly, courts typically require security in the full 

amount of the judgment. Id. at 215–16 (setting bond at full amount of 

judgment plus three months’ interest); Gallatin Fuels, 2006 WL 952203 at 

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*2 (setting bond at full amount of judgment); Frankel, 168 F.R.D. at 22 

(setting bond at 110% of amount of judgment). 

In re Apollo Grp., Inc. Sec. Litig., 2008 WL 410625, at *2; see also Fredianelli v. 

Jenkins, 2013 WL 5934988, at *1 (N.D. Cal. Nov. 4, 2013) (“Because Rule 62(b) is 

intended to preserve the status quo while protecting the prevailing party’s interest in the 

judgment, a stay of judgment usually requires a bond. Typically, the amount of the bond 

will be set in an amount that will permit satisfaction of the judgment in full, together with 

costs, interest, and damages for delay.” (internal quotations omitted)). Consequently, the 

Court will follow the general rule here and permit Lexington to extend the automatic stay 

until the Court disposes of its “forthcoming post-trial motions” if it posts a bond in the 

amount of (1) the judgment ($3,410,000.01 plus pre-judgment interest1

) plus (2) postjudgment interest at 0.23% for seven months from the date judgment was entered2

 with 

the Clerk of Court before the current stay expires on Friday, November 13, 2015. 

 Pursuant to Rule 59, Lexington’s post-trial motions must filed by Friday, 

November 27, 2015. If Lexington posts a bond in the required amount before the current 

stay expires but does not file any post-trial motions by November 27, 2015, then the bond 

shall be exonerated and Defendants/Counterclaimants may immediately execute on the 

judgment, unless Lexington has properly obtained a stay of execution pursuant to Rule 

62. The Court warns that no time extensions regarding post-trial motions will be granted. 

IV. Conclusion 

Based on the foregoing, 

IT IS ORDERED that Lexington’s Emergency Motion to Extend the Temporary 

Stay of Execution on the Judgment (First Request) (Doc. 487) is granted on the condition 

 

1

 Lexington complains in its motion that it has been unable to calculate the 

judgment’s pre-judgment interest due to the Court’s “unclear” rulings. (Doc. 487 at 3). 

The Court trusts that its recent clarification dispelled any confusion. See (Doc. 489). 

2

 This amount is $4,575.00. Yearly post-judgment interest for the judgment 

amount of $3,410,000.01 is approximately $7,843.00. Thus, interest for seven months is 

approximately $4,575.00. 

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that Lexington post a bond with the Clerk of Court no later than Friday, November 13, 

2015 in the amount of (1) $3,410,000.01 plus pre-judgment interest plus (2) postjudgment interest at 0.23% for seven months from the date judgment was entered. 

However, if Lexington either (1) fails to post the full bond by November 13, 2015 or (2) 

fails to file its post-trial motions by November 27, 2015, then the stay shall automatically 

be lifted. If Lexington posts the full bond by November 13, 2015 and files its post-trial 

motions by November 27, 2015, then the stay shall continue until the Court disposes of 

Lexington’s post-trial motions. 

 Dated this 10th day of November, 2015. 

 

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