United States District Court, D. Arizona
S. WILLETT, UNITED STATES MAGISTRATE JUDGE
Order sets forth the Court's rulings on a number of
pending Motions (Docs. 40, 41, 43, 46, 47, 52, and 53).
Defendants' “Motion for a Bond Requirement for
Plaintiff” (Doc. 40) and Plaintiff's “Motion
to Strike Defendants' Untimely Reply, and to Strike or
Disregard Arguments Raised for the First Time Therein”
to Local Rule of Civil Procedure (“LRCiv”)
54.1(c), Defendants filed a Motion (Doc. 40) requesting that
the Court order Plaintiff to post a $25, 000 bond for
Defendants' fees and taxable costs incurred in this
action. (Doc. 40). Plaintiff filed his Response
(Doc. 42) on June 21, 2019. On July 1, 2019, Defendants filed
their Reply (Doc. 45). Contrary to Plaintiff's assertion
in his Motion to Strike (Doc. 46), Defendants' Reply is
timely. Plaintiff correctly recounts that the rules provide a
seven-day deadline for filing a reply in support of a motion.
Plaintiff, however, neglects to consider that Federal Rule of
Civil Procedure 6(d) states:
When a party may or must act within a specified time after
service and service is made under Rule 5(b)(2)(C), (D), (E),
or (F), 3 days are added after the period would otherwise
expire under Rule 6(a).
5(b)(2)(E) includes service by electronic means. Seven days
from Plaintiff's June 21, 2019 Response (Doc. 42) is June
28, 2019. After adding another three days pursuant to Rule
6(d), Defendants' reply deadline was July 1, 2019.
Although Plaintiff alternatively argues that the Court should
strike or disregard arguments raised for the first time in
Defendants' Reply (Doc. 45), the Court finds that the
arguments contained therein are in response to issues raised
in Plaintiff's Response (Doc. 42). The Court will deny
Plaintiff's Motion to Strike (Doc. 46). For the reasons
discussed below, the Court will grant Defendants' Motion
for a Bond (Doc. 40).
is no specific provision in the Federal Rules of Civil
Procedure relating to security for costs. However, the
federal district courts have inherent power to require
plaintiffs to post security for costs.” Simulnet E.
Assoc. v. Ramada Hotel Operating Co., 37 F.3d 573, 574
(9th Cir. 1994). “Typically federal courts, either by
rule or by case-to case determination, follow the forum
state's practice with regard to security for costs, as
they did prior to the federal rules; this is especially
common when a non-resident party is involved.”
Id. (internal quotation marks and citation omitted).
The historical purpose of bond requirements is “to help
resident defendants collect costs when victorious against
non-resident plaintiff whose property was beyond the reach of
the court.” Gay v. Chandra, 682 F.3d 590, 594
(7th Cir. 2012).
Simulnet, the Ninth Circuit reviewed whether the
district court abused its discretion by dismissing a case
after the plaintiffs failed to post a $500, 000 cost bond,
which was imposed five days before trial was set to commence.
37 F.3d at 573. In holding that the district court abused its
discretion, the Ninth Circuit stated that the district court:
knew that the plaintiffs could not post the bond, but imposed
the bond because of its belief that the defendants would
prevail in the jury trial, even though the court declined to
hold the plaintiffs' claims were vexatious. In practical
effect, this amounted to a judgment as a matter of law in a
case where discovery proceedings revealed there was a genuine
issue of material fact to be determined by the jury.
Id. at 576. The Ninth Circuit explained that
“[i]n order to avoid depriving a plaintiff of access to
the courts by a security bond requirement, the courts in some
cases must strike a delicate balance.” Id. The
Ninth Circuit did not hold that district courts must use a
specific balancing test, but noted that the “First
Circuit made an illuminating comment” regarding the
issue. Id. In Aggerwal v. Ponce School of
Medicine, 745 F.2d 723, 727-28 (1st Cir. 1984), the
First Circuit weighed the following three factors in
determining whether a district court abused its discretion in
requiring a security for costs: (i) the degree of probability
or improbability of success on the merits, and the background
and purpose of the suit; (ii) the reasonable extent of the
security to be posted, if any, viewed from the
defendant's perspective; and (iii) the reasonable extent
of the security to be posted, if any, viewed from the
nondomiciliary plaintiff's perspective.
Aggerwal, 745 F.2d at 727-28. The First Circuit
further explained that:
just as factors such as the absence of attachable property
within the district or the conduct of the parties may bear on
a defendant's legitimate need for the prophylaxsis of a
bond, so too, a plaintiff's ability to post surety for
costs must weigh in the balance when the third figure of the
equation is tabulated . . . . The district court, in the
exercise of its sound discretion, must settle upon an
assurance which is fair in the light not only of the case
itself and of the exigencies faced by the defendant, but also
fair when illuminated by the actual financial situation of
Id. at 728.
given the early stage of litigation, the Court does not
conclude that either party is more likely to succeed.
Defendants reasonably assert that a bond is required because
Plaintiff does not reside in the State of Arizona and does
not own any property within Arizona out of which a judgment
for costs can be satisfied. Plaintiff states that he has
substantial equity in ...