Opinion ID: 1362345
Heading Depth: 3
Heading Rank: 5

Heading: Motion to Dismiss for Failure to Post the Bond

Text: Finally, we address Plaintiffs-Appellees' motion to dismiss Wilkinson's merits appeal for failure to post the Rule 7 bond. Where an appellant has failed to pay an appeal bond, it is within our sound discretion to dismiss the appeal. Hagan v. Whitman, 356 F.2d 742, 745 (9th Cir.1966) (per curiam). However, Federal Rule of Appellate Procedure 3(a)(2) provides that [a]n appellant's failure to take any step other than the timely filing of a notice of appeal does not affect the validity of the appeal, but is ground only for the court of appeals to act as it considers appropriate, including dismissing the appeal. Thus, an appellant is not required to post a Rule 7 bond to perfect its appeal. See also Fed. R.App. P. 3(a) advisory committee's note (1967 adoption). Our case law offers little guidance on how we should exercise our discretion when an appellant has failed to post a Rule 7 bond. Hagan, our most recent published opinion on this question, is more than forty years old. In that case, we dismissed an appeal where appellants failed to post a bond for appellate costs ordered under former Federal Rule of Civil Procedure 73(e), on which the later-adopted Rule 7 was modeled. Hagan, 356 F.2d at 745. We did not offer specific reasons for our conclusion that dismissal was proper, other than noting that the bond default was part of a pattern of many small or large careless or calculated errors made by appellants throughout this litigation[] both below and on appeal, and that the appeal seem[ed] suspiciously like a frivolous appeal. Id. at 744-45. More helpful than our decision in Hagan is a recent decision by the Sixth Circuit, In re Cardizem CD Antitrust Litigation, in which the court dismissed the appeal of a named plaintiff who objected to a proposed settlement in a nationwide antitrust class action based on the plaintiff-appellant's failure to post a Rule 7 bond of $174,429 covering security for filing and brief preparation costs, incremental administration costs, and projected attorneys' fees. 391 F.3d at 814-15. The court first noted that the appellant had not made a good faith proffer of a lesser [undisputed] amount or sought a stay in the district court. Id. at 818. It then considered as relevant factors, prejudice to the other parties, the demonstrated justification for the failure to post the bond, and the merits of the underlying appeal. Id. Concluding that none of these other factors weighed in the appellant's favor, the court elected to dismiss the appeal. Id. We conclude, on the facts of this case, that the factors discussed in Cardizem do not support dismissal of Wilkinson's appeal. First, in contrast to the appellant in Cardizem, Wilkinson did proffer payment of the undisputed portion of the bond, $2,000.00, to the district court clerk, which was refused. Wilkinson then moved in the district court to reduce the bond amount. When her motion was denied, she appealed the bond order. Although Wilkinson did not move to stay the bond, she did not simply ignore [the] order, id., but rather made legitimate efforts to reduce its amount. Her diligence in this respect weighs against dismissal of her appeal. Second, in contrast to Cardizem, where the appellant made no effort in the district court to justify her failure to post the bond, id., Wilkinson has consistently argued that the amount of the bond was legally erroneous because neither Rule 7 nor Section 4 of the Clayton Act supports the district court's order requiring security for appellate attorney's fees. Although we have rejected Wilkinson's argument concerning Rule 7, we conclude that her reading of Clayton Act Section 4 is correct. While a meritorious legal argument for reducing the amount of a Rule 7 bond might not excuse its nonpayment in all circumstances, this factor weighs against dismissal here. Third, in contrast to Cardizem where the court concluded that the appellant's appeal lacked merit, Wilkinson's appeal raises legitimate questions about class certification, notice, and the settlement's fairness, reasonableness, and adequacy. Finally, we reject Plaintiffs-Appellees' argument that Wilkinson's failure to pay the bond has caused them undue prejudice by delaying completion of the settlement. Any delay in completion of the settlement stems from Wilkinson's appeal itself, not from her failure to pay the bond. We therefore decline to dismiss Wilkinson's appeal on the merits.