The opinion of the court was delivered by: CHARLES NORGLE, District Judge
Before the court is Edward R. Theobald's motion styled as an "Agreed
Motion to St. Enforcement of the Judgment Pending Appeal Without Posting a
Bond," brought pursuant Federal Rules of Civil Procedure 62(c) and 62(d).
For the following reasons, the motion denied.
On March 29, 2004, the court issued an order finding that the conduct
of Anthony Pinelli Alan R. Brunell and Edward R. Theobald (collectively
"counsel") was sanctionable, stating:
The court finds that attorneys Edward R. Theobald,
Alan R. Brunell and Anthony Pinelli have disobeyed
the orders of the United States District Court and
acted improperly by seeking and obtaining numerous
awards of attorney fees, as improperly appointed
counsel, in the Circuit Court of Cook County,
after the entire cause of action had been removed
to the United States District Court. Further,
counsel proceeded with that conduct after a motion
to remand had been denied, while that issue of
remand was on appeal in the Seventh Circuit and
after the Seventh Circuit's decision, after they
were aware that the court was handling issues of
appointments and awards of attorney fees pursuant
to 55 Ill. Comp. Stat. § 5/3-9008 for other
attorneys in the case, and despite the court's
repeated admonitions that further litigation in
the state court would be in contravention of the
federal court's jurisdiction and improper.
Additionally, the court finds that the statements
and actions of each attorney violated their duty
of candor to the court. The sanctionable conduct
of each officer of the court was willful,
intentional and repeated, and was an attempt to
circumvent the United States District Court's removal jurisdiction. Attorneys Edward R.
Theobald, Alan R. Brunell and Anthony Pinelli are
hereby sanctioned pursuant to the court's inherent
See Schmude v. Sheahan, et al., F. Supp.2d ,
2004 WL 718501, *43 (N.D. Ill. March 29, 2004). The court sanctioned
counsel, ordering disgorgement of all improperly acquired attorney fees
and payment of a $5,000.00 fine. See id. at *44. In
order to assess the exact amount of disgorgement, the court ordered that
counsel file "a detailed accounting of all fees requested and received in
the Circuit Court of Cook County which relate to this civil matter,
including copies of all pleadings filed by counsel, orders entered by the
Circuit Court of Cook County, and all fee petitions submitted to date"
within 28 days of the court's order. See id. The
court stated that "[o]nce counsel submit such accountings, the court will
enter an order requiring counsel to disgorge those improperly acquired
attorney fees in a specific dollar amount to the source of such funds by
May 28, 2004." See id. On April 26, 2004, counsel
submitted their accountings to the court. On May 4, 2004, the court
entered a Final Judgment Imposing Sanctions Against Anthony Pinelli, Alan
R. Brunell and Edward R. Theobald. See Schmude v. Sheahan, et
al., F. Supp.2d , 2004 WL 1045798 (N.D. Ill. May 4,
2004). The court ordered counsel to pay a sanction of $5,000.00 to the
Clerk of the United States District Court for the Northern District of
Illinois by May 28, 2004. See id. at 40. The court
also imposed the sanction of disgorgement, ordering counsel to disgorge
the full amounts of improperly obtained attorneys to Cook County by May
28, 2004, and to certify compliance with the court's order by June 14,
2004. See id. Lastly, the court also "enjoined [counsel] from
seeking attorney fees or receiving remuneration from Cook County for
their representation of their clients in this case or for defending
themselves against the Rule to Show Cause and resultant proceedings."
Id. The court also indicated that in order to ensure compliance
with the court's orders, the injunction would be reviewed at six-month
intervals from the date of entry of judgment. See id.
The court has addressed numerous other motions filed by counsel, and
issued decisions, which are not directly relevant to the instant motion.
The court will now proceed to address the instant motion. II. DISCUSSION
is asking the court to stay enforcement of the
court's May 4, 2004 sanction order pending appeal, without posting a
supersedeas bond, pursuant to Federal Rules of Civil Procedure 62(c) and
62(d). Rules 62(c) and 62(d) state:
(c) Injunction Pending Appeal. When an appeal is
taken from an interlocutory or final judgment
granting, dissolving, or denying an injunction,
the court in its discretion may suspend, modify,
restore, or grant an injunction during the
pendency of the appeal upon such terms as to bond
or otherwise as it considers proper for the
security of the rights of the adverse party.
. . .
(d) Stay Upon Appeal. When an appeal is taken the
appellant by giving a supersedeas bond may obtain
a stay subject to the exceptions contained in
subdivision (a) of this rule. The bond may be
given at or after the time of filing the notice of
appeal or of procuring the order allowing the
appeal, as the case may be. The stay is effective
when the supersedeas bond is approved by the
Fed.R.Civ.P. 62(c, d).
Under Rule 62(d), a party may obtain an automatic stay of execution of
a money judgment pending appeal by posting a supersedeas bond. See
BASF Corp. v. Old World Trading Co., 979 F.2d 615, 616 (7th Cir.
1992); see also Northern District of Illinois Local Rules 62.1,
65.1 and 65.2 (discussing procedures for supersedeas bond). In the
instant motion, attorney Theobald requests the court to stay enforcement
of the court's May 4, 2004 sanction order without first requiring him to
post a supersedeas bond; thus, he is not entitled to a stay as a matter
of right. See Fed.R.Civ.P. 62(d); BASF, 979 F.2d at 616.
In its discretion, however, the district court may waive the bond
requirement. See Dillon v. City of Chicago, 866 F.2d 902, 904
(7th Cir. 1988); see also Olympia Equip. Leasing Co. v. Western
Union Tel. Co., 786 F.2d 794, 796 (7th Cir. 1986) (indicating that
sometimes equivalent security may replace the bond). When determining
whether to waive the posting of bond, the court looks to several
criteria, including: (1) the complexity of the collection process; (2)
the amount of time required to obtain a judgment after it is affirmed
on appeal; (3) the degree of confidence that the district court has in
the availability of funds to pay the judgment; (4) whether the movant's
ability to the bond to pay the judgment is so plain that the cost of a
bond would be a waste of money; and (5) whether the movant is in such a
precarious financial situation that the requirement to post a bond would
place other creditors of the defendant in an insecure position. See
Dillon, 866 F.2d at 904-05 (citations omitted). However, before the
court can exercise its discretion to grant a stay without a bond, it must
first determine whether a stay is warranted.
The United States Supreme Court has set forth the general factors
regulating the issuance of a stay pending appeal: "(1) whether the stay
applicant has made a strong showing that he is likely to succeed on the
merits; (2) whether the applicant will be irreparably injured absent a
stay; (3) whether issuance of the stay will substantially injure the
other parties interested in the proceedings; and (4) where the public
interest lies." Hilton v. Braunskill, 481 U.S. 770, 776 (1987)
(citations omitted); see also Bradford-Scott Data Corp, v. Physician
Computer Network, Inc., 128 F.3d 504, 505 (7th Cir. 1997);
Glick v. Koenig, 766 F.2d 265, 269 (7th Cir. 1985). "Since the
traditional stay factors contemplate individualized judgments in each
case, the formula cannot be reduced to a set of rigid rules."
Id. at 777. Further, a request for a stay is a request for
extraordinary relief, equitable in character, and the movant bears a
heavy burden. See Winston-Salem/Forsyth County Bd. of Educ. v.
Scott, 404 U.S. 1221, 1231 (1971) (Burger, C.J., in chambers);
Chan v. Wodnicki, 67 F.3d 137, 139 (7th Cir. 1995).
B. Analysis of Stay Factors under Rules 62(c) and (d)
1. Likelihood of Success on the Merits
Attorney Theobald has not made a sufficient showing of his likelihood
of success on the merits. "In the context of a stay pending appeal, where
the applicant's arguments have already been evaluated on the success
scale, the applicant must make a stronger threshold showing of likelihood
of success to meet his burden." In re Forty-Eight Insulations,
115 F.3d 1294, 1300-01 (7th Cir. 1997) (citation omitted). Further, the Seventh Circuit
has stated: "Our case law is adamant that an appellant faces an uphill
battle in seeking to reverse an award of sanctions by the district
court." Langley v. Union Elec. Co., 107 F.3d 510, 513 (7th Cir.
1997) (citing Marrocco v. General Motors Corp.,
966 F.2d 220, 223 (7th Cir. 1992) ("We cannot understate the difficulty of the
task litigants face when challenging a district court's choice of
To reiterate, in the Rule to Show Cause, the court framed the issues to
which counsel were ordered to respond. The Rule to Show Cause alleged
that counsel had willfully disobeyed established statutory and case law
authority and the court's orders by improperly seeking to become
court-appointed counsel and obtaining numerous awards of attorney fees in
the Circuit Court of Cook County after the cause of action had been
removed to the United States District Court for the Northern District of
Illinois. The Rule to Show Cause also alleged that counsel had exhibited
a lack of candor toward the court. The ...