United States District Court, D. Arizona
Murray Enow Chief United States District Judge.
before the Court is Defendants City of Mesa, Brian Elmore,
Christopher Doane, Bryan Cochran and Richard Gomez's
Motion to Stay Due to Defendant Brailsford's Bankruptcy.
(Doc. 227). That motion is joined by Defendants Charles
Langley and LQ Management. (See Doc. 229, 230). For
the following reasons, the motion is denied.
case arises out of an incident at a La Quinta hotel, where an
officer of the City of Mesa police force shot and killed an
unarmed civilian in a hotel hallway. The decedent's
surviving relatives brought separate actions seeking
compensation that were consolidated in this action before the
Court. More recently, Defendant Officer Philip Brailsford-who
fatally shot the decedent-filed for bankruptcy. (See
Doc. 224). Due to the ongoing bankruptcy action, an automatic
stay has been entered for all claims against Officer
Brailsford. (Id. at 2). The remaining Defendants in
this action-including the City of Mesa, the other police
officers who were present during the shooting, and the
hotel-now move to stay the entire case pursuant to the
Court's inherent authority to manage its docket. For the
following reasons, that request is denied.
to 11 U.S.C. § 362, the filing of the bankruptcy
petition operates as an automatic stay as to the actions
against Defendant Brailsford. See 11 U.S.C. §
901(a). However, that provision does not automatically stay
this action as to the other, non-bankrupt defendants. See
Parker v. Bain, 68 F.3d 1131, 1137 (9th Cir. 1995)
(“All proceedings in a single case are not lumped
together for purposes of automatic stay analysis. . . .
Within a single case, some actions may be stayed, others not.
Multiple claim and multiple party litigation must be
disaggregated so that particular claims, counterclaims, cross
claims and third-party claims are treated independently when
determining which of their respective proceedings are subject
to the bankruptcy stay.”). “In the absence of
special circumstances, stays pursuant to § 362(a) are
limited to debtors and do not include non-bankrupt
co-defendants.” Ingersoll-Rand Financial Corp. v.
Miller Mining Inc., 817 F.2d 1424, 1427 (9th Cir. 1987).
“If the unusual circumstances exception applies,
however, the weight of authority holds that the bankruptcy
court that must extend the automatic stay, not this
[C]ourt.” Zurich Amer. Ins. Co. v. Trans Cal.
Assoc., 2011 WL 6329959 at *2 (E.D. Cal. 2011) (internal
citations and quotation marks omitted); see also Alvarez
v. Bateson, 176 Md.App. 136, 932 A.2d 815, 821 (Md. Ct.
Spec. App. 2007) (“[T]he weight of authority holds
that, in order for an automatic stay pursuant to section 362
to be applied to a non-bankrupt co-defendant, the debtor must
request and obtain a stay from the bankruptcy court where the
current action is pending.”) Because the bankruptcy
court has not entered a stay as to the other defendants, the
Court will decline to do so here pursuant to §
the Court will decline to stay this case pursuant to its
inherent authority because doing so would not be the fairest
course of action for the remaining parties involved in this
case. See Mediterranean Enters., Inc. v. Ssangyong
Corp., 708 F.2d 1458, 1465 (9th Cir. 1983) (A
“trial court may, with propriety, find it is
efficient for its own docket and the fairest course for the
parties to enter a stay of an action before it, pending
resolution of independent proceedings which bear upon the
case.”) (emphasis added). Here, the Court finds that
the interest in the expedient resolution of the remaining
claims outweighs the convenience to the parties of resolving
all claims at the same time. It will therefore decline to
issue a stay under its inherent authority.
IS THEREFORE ORDERED that Defendants' request
for a stay (Doc. 227) is DENIED Dated this
5th day of June, 2019.
 Defendants further argue that
conducting discovery against the non-debtor defendants would
violate the stay. (See Doc. 227 at 8). But
bankruptcy courts have generally refused to stay discovery
under § 362 even when that discovery could generate
damaging information against the debtor defendant. See
Groner v. Miller, 262 B.R. 499, 505-05 (Bankr. App. P.
9th Cir. 2001) (“[S]ection 362(a) does not preclude
generation ofinformation regarding claims by or against a
non-debtor party, even where that information could
eventually adversely affect the debtor.”). And as
Defendants concede, Officer Brailsford will have the
opportunity to conduct additional discovery once the
bankruptcy stay is lifted.
Defendants also argue that because some of the
remaining claims are entirely derivative of liability to
Officer Brailsford, the Court is required to stay those
claims as to the other defendants. Even assuming that those
claims are entirely derivative, that fact does not require
the Court to make a finding of unusual circumstances. See
Teachers Ins. And Annuity Ass'n. v. Butler 803 F.2d
65-66 (2d. Cir. 1986) (declining to make ...