United States District Court, D. Arizona
Douglas L. Rayes United States District Judge
issue is Plaintiffs' Motion to Exonerate and Release
Voluntary Supersedeas Bond. (Doc. 496.) The motion is fully
briefed. For the following reasons, Plaintiffs' motion is
initiated this action six years ago, asserting a number of
claims related to their efforts to obtain a home loan
modification. On October 9, 2014, the Court granted summary
judgment in favor of Defendants on all remaining claims.
Thereafter, the Court awarded Defendants $39, 524.00 in
attorneys' fees pursuant to fee-shifting provisions in
the Note and Deed of Trust governing Plaintiffs' home
loan. Alternatively, the Court found that if the fee-shifting
provisions were inapplicable Defendants nonetheless would be
entitled to their attorneys' fees under A.R.S. §
12-341.01(A). Plaintiffs appealed both orders.
28, 2015, with no objection from Defendants, the Court
granted Plaintiffs' motion to stay execution of the fee
award order upon posting of a supersedeas bond. Specifically,
the Court ordered that “upon the posting of the bond,
execution of the order awarding [Defendants] attorneys'
fees in the amount of $39, 524.00 shall be STAYED until the
Court of Appeals has completed its review of this Court's
order and a mandate has issued.” (Doc. 490.) On June 2,
2015, Plaintiffs posted a bond with the Court in the form of
a cashier's check in the amount of $39, 524.00.
roughly two years of appellate litigation, the Ninth Circuit
Court of Appeals issued a memorandum decision affirming the
Court's orders granting summary judgment in favor of
Defendants and awarding attorneys' fees pursuant to the
fee-shifting provisions of the Note and Deed of
Trust. Rich v. Bank of Am., N.A., 666
Fed.App'x 635 (9th Cir. 2016). The Ninth Circuit issued
its mandate on December 13, 2016. Two days later, Plaintiffs
filed the instant motion seeking exoneration of their bond.
purpose of a supersedeas bond is to secure the appellees from
a loss resulting from a stay of execution[.]” U.S.
ex rel. Cafasso v. Gen. Dynamics C4 Sys., Inc., No. CV
06-01381 PHX NVW, 2010 WL 384594, at *2 (D. Ariz. Jan. 29,
2010). “The posting of a bond protects the prevailing
[party] from the risk of a later uncollectible judgment and
compensates him for delay in the entry of the final
judgment.” N.L.R.B. v. Westphal, 859 F.2d 818,
819 (9th Cir. 1988). “Courts release supersedeas bonds
when the bond has served its purpose and no outstanding
judgment remains. A supersedeas bond posted for a stay of
execution of judgment should be released once all appeals are
exhausted, the stay has been lifted and full payment has been
made.” Goss Int'l Corp. v. Tokyo Kikai
Seisakusho, Ltd., No. 00-CV-35-LRR, 2006 WL 4757279, at
*3 (N.D. Iowa Aug. 9, 2006) (citations omitted).
Ninth Circuit has affirmed the fee award, its mandate has
issued, no further proceedings are pending, and by its own
terms the stay has expired. It does not appear, however, that
Plaintiffs have fully paid the fee award. Plaintiffs
nonetheless argue that they are entitled to have their bond
exonerated. The crux of their argument is that the
fee-shifting provisions in the Note and Deed of Trust require
Defendants to add attorneys' fees incurred in the
connection with Plaintiffs' default on the Note to the
amounts already owed under those instruments. Because
Defendants have elected to conduct a non-judicial foreclosure
of the subject property, Plaintiffs argue that Arizona's
anti-deficiency protections preclude them from recouping
their attorneys' fees from anything other than the
trustee's sale proceeds. See A.R.S. §§
33-729(A), -814(G). Defendants sold the property at a
trustee's sale on February 3, 2017. Plaintiffs therefore
contend that Defendants have received all amounts to which
they are entitled under Arizona law.
marks the third time Plaintiffs have pressed this issue.
Plaintiffs first advanced this argument in their opposition
to Defendants' attorneys' fees motion. The Court
rejected it. Plaintiffs reasserted this argument on appeal
and it was briefed by both sides. (See Doc. 19 at
67-69, Doc. 26 at 45-46 in Rich v. Bank of Am.,
N.A., No. 14-17190; 15-15885.) Though the Ninth Circuit
concluded that fees could not be awarded under both
the contractual fee-shifting provisions and A.R.S.
§ 12-341.01(A), it affirmed without modification the
portion of this Court's order awarding Defendants their
attorneys' fees under the Note and Deed of Trust. In so
doing, the Ninth Circuit implicitly rejected the argument
again at issue here. Plaintiffs are not entitled to a third
bite at the apple.
Plaintiffs' motion is foreclosed by the “law of the
case” doctrine, which precludes a court “from
reexamining an issue previously decided by the same court, or
a higher court, in the same case.” Richardson v.
United States, 841 F.2d 993, 996 (9th Cir. 1988). The
doctrine applies where, as here, the issue was “decided
explicitly or by necessary implication in [the] previous
disposition.” Liberty Mut. Ins. Co. v.
E.E.O.C, 691 F.2d 438, 441 (9th Cir. 1982). “This
rule of practice promotes the finality and efficiency of the
judicial process by protecting against the agitation of
settled issues.” Christianson v. Colt Industries
Operating Corp., 486 U.S. 800, 816 (1988) (internal
quotations and citation omitted). Having been explicitly
decided by this Court and by necessary implication by the
Ninth Circuit, the argument raised by Plaintiffs in their
instant motion is “not open to relitigtion.”
Mann v. GTCR Golder Rauner, LLC, 483 F.Supp.2d 864,
870 (D. Ariz. 2007).
all appeals have been exhausted and the stay issued by the
Court has expired, Plaintiffs are not entitled to exoneration
of the supersedeas bond until full payment of the
attorneys' fee award has been made. If Plaintiffs refuse
to fully pay the fee award or lack the means to do so,
Defendants may take appropriate measures to obtain the bond
to satisfy the outstanding judgment for which it was posted
as security. See J. Perez & Cia., Inc. v. United