Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_04-cv-03946/USCOURTS-cand-5_04-cv-03946-55/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 42:1983 Civil Rights Act

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Case No.: 5:04-cv-03946-EJD

ORDER DENYING MOTION FOR APPEAL BOND

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

JOSEPH PADGETT, et al.,

Plaintiffs,

v.

BRIAN LOVENTHAL, et al.,

Defendants.

Case No. 5:04-cv-03946-EJD 

ORDER DENYING MOTION FOR 

APPEAL BOND

Re: Dkt. No. 1096

Presently before the Court is a motion under Federal Rule of Appellate Procedure 7 to 

compel Plaintiff Joseph Padgett (“Mr. Padgett”) to file a bond for attorneys’ fees and costs. See

Dkt. Nos. 1096, 1097 (“Mot.”). This motion was filed by Mr. Padgett’s trial counsel, The Law 

Firm of Kallis & Associates P.C. (the “Kallis Firm”) and Bustamante & Gagliasso P.C. (the 

“Bustamante Firm”) (collectively, “Counsel”). Counsel request that Mr. Padgett be required to 

post a bond of $75,000 to pursue an appeal of this Court’s order granting in part and denying in 

part Plaintiffs’ motion for attorneys’ fees and costs under 42 U.S.C. § 1988. See Mot. at 8-9. The 

Court found this matter suitable for decision without oral argument pursuant to Civil Local Rule 

7–1(b), and previously vacated the hearing scheduled for July 2, 2015. Having considered the 

parties’ submissions and the relevant law, Counsel’s motion is DENIED. 

I. BACKGROUND

A. Underlying Litigation 

In September 2004, Mr. Padgett and Darla Padgett (“Ms. Padgett”) commenced the instant 

action alleging seven claims that included constitutional rights violations, statutory violations, and 

tortious misconduct that stemmed from a dispute with the City of Monte Sereno, California,

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ORDER DENYING MOTION FOR APPEAL BOND

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regarding the enforcement of a fence height ordinance. These claims were asserted against eight 

defendants that included the City, the City Manager, the Mayor, members of the City Council, and 

a former City employee. 

At commencement of the case, Mr. and Ms. Padgett were represented by the law firm 

McManis Faulkner & Morgan (the “McManis Firm”). In June 2006, the McManis Firm moved to 

withdraw as counsel, and the Court granted this request. In September 2008, the Kallis Firm and

the Bustamante Firm moved to serve as counsel of record for Mr. and Ms. Padgett, which the 

Court granted. 

By the time trial commenced in May 2009, only two claims remained—violations of the 

First and Fourteenth Amendments—asserted against two defendants. Counsel represented Mr. 

and Ms. Padgett during the jury trial. The jury returned a verdict for Mr. Padgett on one claim 

asserted against one defendant, and awarded him nominal damages of $1.00 and punitive damages 

of $200,000. During post-trial motions, the Court remitted the punitive damages award to 

$10,000. The jury rejected all of Ms. Padgett’s claims. 

B. Procedural History 

After the trial, Mr. Padgett moved for attorneys’ fees and costs pursuant to 42 U.S.C. § 

1988. Two requests were submitted: the first was on behalf of Counsel, and the second was on 

behalf of the McManis Firm. See Dkt. Nos. 945, 951. In June 2010, the judge who presided over 

the trial, Judge James Ware, awarded Mr. Padgett $500,000 in attorneys’ fees and $100,000 in 

costs. See Dkt. No. 995 at 8, 10. Defendants appealed the decision to the Ninth Circuit. See Dkt. 

No. 1000. In February 2013, the Ninth Circuit vacated and remanded because the district court 

did not explain how the court calculated the amount awarded for attorneys’ fees and costs. See

Dkt. No. 1023 at 5-6. Upon remand, this case was reassigned to the undersigned judge. See Dkt. 

No. 1030. 

In October 2013, a case management conference was held to discuss renewed motions for 

attorneys’ fees and costs. See Dkt. No. 1039. Since the undersigned did not preside over the trial

and given this action’s extensive history, the Court instructed all parties seeking an award of 

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attorneys’ fees and costs to submit new motions for such relief. See Dkt. No. 1040. Specifically, 

the Court ordered Mr. Padgett to submit a motion for any fees sought on behalf of the McManis 

Firm, and instructed Counsel to submit a motion supporting their own request for any fees sought 

in connection with their representation. Id. 

Mr. Padgett did not file a motion for attorneys’ fees and costs as instructed by the Court, 

nor did he request relief from the motion-filing deadline. See Dkt. No. 1054 at 2. Due to his 

failure to file a timely motion, the Court found that Mr. Padgett had forfeited his ability to seek 

fees and costs on behalf of the McManis Firm. See id. Thereafter, Mr. Padgett filed a motion for 

leave to file a motion for reconsideration, stating that he had already filed a motion for attorneys’ 

fees and costs on behalf of the McManis Firm several years before, and that nothing had changed 

to warrant a new filing. See Dkt. No. 1056 at 2. The Court denied Mr. Padgett’s motion because 

he had failed to notify the Court of his inability to renew his motion prior to the motion-filing 

deadline. See Dkt. No. 1057. Counsel, however, did submit a timely motion for attorneys’ fees 

and costs incurred during their representation of Mr. Padgett. See Dkt. Nos. 1050; 1054 at 2. In 

March 2015, after reviewing Counsel’s arguments and itemized billings, the Court awarded Mr. 

Padgett $471,056.64 in attorneys’ fees and $100,000 in costs for services provided by Counsel. 

See Dkt. No. 1087 at 14. 

In April 2015, Mr. Padgett filed a notice of appeal from the second order on attorneys’ fees 

and costs. See Dkt. No. 1090. In May 2015, Counsel filed the instant motion, seeking to compel 

Mr. Padgett to file an appeal bond. See Dkt. No. 1096. Mr. Padgett filed an opposition brief, and 

Counsel filed a reply brief. See Dkt. Nos. 1105, 1106. 

II. LEGAL STANDARD

Federal Rule of Appellate Procedure 7 govern appeal bonds: “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.” “[T]he purpose of [an appeal bond] is to protect 

an appellee against the risk of nonpayment by an unsuccessful appellant.” Fleury v. Richemont N. 

Am., Inc., No. C-05-4525 EMC, 2008 WL 4680033, at *6 (N.D. Cal. Oct. 21, 2008) (Chen, J.) 

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(citations omitted). The district court has discretion to determine the need for a bond, as well as 

the amount of the bond. Id. 

As to the bond amount, Federal Rule of Appellate Procedure 39(e) defines the “costs on 

appeal” that are taxable in the district court: 

(1) the preparation and transmission of the record; 

(2) the reporter’s transcript, if needed to determine the appeal; 

(3) premiums paid for a supersedeas bond or other bond to preserve 

 rights pending appeal; and 

(4) the fee for filing the notice of appeal.

While attorneys’ fees are not specifically enumerated in Rule 39, the Ninth Circuit has held that “a 

district court may require an appellant to secure appellate attorney’s fees in a Rule 7 bond . . . only 

if an applicable fee-shifting statute includes them in its definition of recoverable costs, and only if 

the appellee is eligible to recover such fees.” Azizian v. Federated Dep’t Stores, Inc., 499 F.3d 

950, 953 (9th Cir. 2007). The mere existence of a fee-shifting statute is not sufficient; “[r]ather, 

the statute must specifically define ‘costs’ to include attorney’s fees.” In re Heritage Bond Litig., 

233 Fed. Appx. 627, 630-31 (9th Cir. 2007). In the context of civil rights litigation where 

attorneys’ fees are sought pursuant to § 1988, however, the Ninth Circuit has held that attorneys’ 

fees are not considered “costs” under Rule 39. Family PAC v. Ferguson, 745 F.3d 1261, 1269 

(9th Cir. 2014). 

III. DISCUSSION

Counsel argues that the costs on appeal are not trivial since this case is heading to the 

Ninth Circuit for the fourth time. Mot. at 10. They contend that, at a minimum, the litigation of 

this appeal will consume over $50,000 in fees, at a blended hourly rate of $575 per hour, and the 

preparation of transcripts and excerpts from the record will cost several thousand dollars. Id. 

Thus, Counsel requests a bond in the amount of $75,000 for costs, which includes attorneys’ fees. 

Id. 

In determining whether to impose an appeal bond, the Ninth Circuit considers the 

following factors: (1) the appellant’s financial ability to post a bond; (2) the risk that the appellant 

would not pay the costs if he loses the appeal; and (3) an assessment of the likelihood that the 

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appellant will lose on appeal and thus be liable for costs. Figure Eight Holdings, LLC v. Dr. Jays, 

Inc., 534 Fed. Appx. 670, 670 (9th Cir. 2013). Each factor will be addressed in turn. 

A. Mr. Padgett’s Financial Ability to Post a Bond 

The first factor generally weighs in favor of a bond unless a party is financially unable to 

post a bond. See Fleury, 2008 WL 4680033, at *7. Here, it is unclear whether Mr. Padgett is 

financially able to post a bond. At the case management conference held on October 11, 2013, 

Mr. Padgett did not dispute Counsel’s assertion that he is homeless. See Dkt. No. 1079 at 6. Yet 

when Mr. Padgett filed the notice of appeal on April 28, 2015, it appears that he paid the $505 

filing fee. See Dkt. No. 1090 (docket entry). In his opposition brief, Mr. Padgett did not contend 

or submit any evidence showing an inability to post a bond. Therefore, in the absence of any 

evidence that posting a bond would impose a substantial hardship, this factor does not preclude the 

imposition of a bond requirement. 

B. Risk that Mr. Padgett Would Not Pay the Costs if He Loses the Appeal 

Courts in this district have recognized the difficulty and risk associated with collecting 

costs from out-of-state appellants. See Schulken v. Wash. Mut. Bank, No. 09-CV-02708-LHK, 

2013 WL 1345716, at *5 (N.D. Cal. April 2, 2013) (Koh, J.); Embry v. ACER Am. Corp., No. C 

09-01808 JW, 2012 WL 2055030, at *1 (N.D. Cal. June 5, 2012) (Ware, J.). This issue may be 

weighed more heavily when an appellant lives outside the jurisdiction of the Ninth Circuit. Id. 

According to his last filing as a pro se litigant on April 9, 2014, it appears that Mr. Padgett 

was residing in the State of Washington. See Dkt. No. 1063. While his opposition brief does not 

provide Mr. Padgett’s current place of residence, this Court assumes that he continues to reside in 

the State of Washington since documents recently sent to the Washington address were not 

returned to the Court. See Dkt. No. 1103-1 (certificate of service). Although Mr. Padgett may 

reside within the jurisdiction of the Ninth Circuit, he resides outside the jurisdiction of this Court. 

In light of the fact that Mr. Padgett and Counsel have now taken adversarial positions in this 

litigation, there is a reasonably high risk that Mr. Padgett would not pay the costs if he were to 

lose the appeal. Therefore, this factor weighs in favor of requiring a bond. 

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C. Likelihood that Mr. Padgett Will Lose on Appeal 

In their motion, Counsel contends that Mr. Padgett lacks standing because he forfeited any 

legal right to an award of attorneys’ fees when he failed to submit a renewed motion for attorneys’ 

fees and costs. Mot. at 6-7. According to Counsel, since Mr. Padgett lacks standing, he will not 

be able to prevail and will owe attorneys’ fees and costs on appeal. Id. at 8. As this Court sees it, 

however, Counsel’s position may be legally erroneous and is a misconstruction of the order 

awarding attorneys’ fees and costs. 

Pursuant to § 1988, “the court, in its discretion, may allow the prevailing party . . . a 

reasonable attorney’s fee as part of the costs[.]” Relying on the plain meaning of the statute and 

on Supreme Court precedent, the Ninth Circuit has ruled that § 1988 attorneys’ fees must be 

awarded to the party, not the party’s lawyer. Gilbrook v. City of Westminster, 177 F.3d 839, 872-

73 (9th Cir. 1999). The Ninth Circuit further stated: “In the absence of a contractual assignment to 

counsel, § 1988 requires that attorney fee awards be made directly to the prevailing party, with the 

ultimate disposition of the award dependent on the contract between the lawyer and the client.” 

Id. at 875. 

Here, Mr. Padgett forfeited only his right to collect attorneys’ fees for the services 

provided by the McManis Firm because he failed to submit a renewed motion for attorneys’ fees 

and costs for that period of representation. However, Mr. Padgett did not forfeit his right to 

collect attorneys’ fees for the services provided by Counsel. Indeed, as this Court’s order stated, 

“Plaintiffs shall receive an attorneys’ fee award . . . and litigation costs[.]” See Dkt. No. 1087 at 

14 (emphasis added). The Court also declined Counsel’s subsequent request to find the award had 

vested or were the property of Counsel. See Dkt. No. 1095. Since Mr. Padgett is the plaintiff in 

this action and the prevailing party, the attorneys’ fees are awarded to him, consistent with 

Gilbrook. Therefore, Counsel’s argument based on lack of standing is unpersuasive. 

Overall, however, the Court recognizes the present awkwardness of this proceeding. 

While the Court awarded Mr. Padgett attorneys’ fees and costs for the services provided by 

Counsel upon the request made on his behalf, there appears to be a dispute between Mr. Padgett 

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and Counsel as to how and to whom the funds should be distributed. In any event, Mr. Padgett’s 

challenge on appeal is not completely without merit to the extent he believes that the language of 

fees and costs award is ambiguous. Therefore, this factor weighs strongly against requiring a 

bond. 

D. Conclusion 

In weighing these factors, the Court finds that an appeal bond is not warranted because Mr. 

Padgett’s appeal is not without merit. This final factor outweighs the collective weight of the 

preceding two, even if they favor imposition of a bond. Mr. Padgett’s efforts before the Ninth 

Circuit, therefore, should not be dissuaded by a court-imposed financial barrier. Any arguments 

concerning the amount of the bond will not be considered because doing so is unnecessary. 

IV. ORDER

For the foregoing reasons, Counsel’s motion to compel Mr. Padgett to file a bond for 

attorneys’ fees costs under Federal Rule of Appellate Procedure 7 is DENIED. 

IT IS SO ORDERED.

Dated: July 13, 2015 

______________________________________

EDWARD J. DAVILA

United States District Judge

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