THOMAS F. HOGAN, District Judge.
Pending before the Court are the following motions: (1) Plaintiffs' Unopposed Motion for Appeal Bond Pursuant to Federal Rule of Appellate Procedure 7 [Docket No. 3856], which seeks "that this Court require [Kimberly] Craven to post a bond or other security in the amount of $8,306,439.93 to ensure prompt payment of plaintiffs'-appellees'
On August 6, 2011, Kimberly Craven filed a notice of appeal challenging this Court's final judgment approving a $3.412 billion settlement in this complex and contentiously-litigated case involving allegations that the United States breached its trust obligations by mismanaging the money, land and resource assets of more than 450,000 Indians. In response to Ms. Craven's appeal, the plaintiffs moved for the imposition of an $8,306,439.93 appeal bond pursuant to Rule 7 of the Federal Rules of Appellate Procedure ("Fed. R. App. P.") and argued that the following "costs" may be taxed against Ms. Craven under the Rule:
The plaintiffs contend that Ms. Craven should be required to post an appeal bond that covers these costs because her appeal will "delay indefinitely class members' relief," Pls. First Mot. for Appeal Bond 4, the delay "means that more elderly and more inform class members will pass on without obtaining justice that they deserve," id. at 5, "she opposes settlement for personal and political reasons" that are not supported by the vast majority of the class members, id. at 6, she has retained a "professional objector" to advocate on her behalf, id. at 7, her appeal "obstructs the efforts of Secretary Salazar to implement meaningful reform because it blocks access to settlement funds appropriated by Congress to establish and operate a Secretarial Commission on Trust Reform," id. at 8, the "delay causes substantial financial loss by denying class members post-judgment interest on their settlement funds and by increasing materially their post-judgment administrative costs and legal fees and expenses," id., an appeal bond "furthers public policy and is not an impermissible condition on appellant's statutory right to appeal," id., and the bond "should be sufficient to cover the cost of defending the appeal before a three-judge panel, en banc, and the Supreme Court," id. at 10-11.
Although conceding that the Court may impose an appeal bond as "`security for payment of costs on appeal,'" Craven's
Three days after filing the appeal-bond motion against Kimberly Craven, the plaintiffs filed a second motion requesting than an appeal bond also be imposed against the Harvest Institute Freedmen Federation, LLC, Leatrice Tanner-Brown, and William Warrior in response to an appeal they filed in June challenging this Court's decisions denying their motion to intervene and motion for reconsideration. See Docket No. 3859. The Harvest Institute Freedmen Federation, Leatrice Tanner-Brown, and William Warrior never responded to the plaintiffs' motion for an appeal bond and the deadline to do so has now passed. See LCvR7, available at http://www.dcd.uscourts.gov/dcd/local-rules. Yesterday the plaintiffs' filed their third motion for an appeal bond against Ortencia Ford and Donnelly Villegas.
With the exception of background that is fact specific, all three of the plaintiffs' appeal-bond motions are identical and raise the same legal arguments. Because the first two appeal-bond motions and the motion for expedited review are now ripe for this Court's consideration, and all three appeal-bond motions raise the very same legal arguments, including the motion filed yesterday, this memorandum opinion will address and dispose of all the pending motions, notwithstanding that the deadline to respond to the third motion has not yet run.
Rule 7 of the Federal Rules of Appellate Procedure ("Fed. R. App. P.") states in relevant part that "[i]n a civil case, the District Court may require an appellant to file a bond or provide other security in any form and amount necessary to ensure payment of costs on appeal." Fed. R.App. P. 7. "The costs referred to, however, are simply those that may be taxed against an unsuccessful litigant under Federal Appellate Rule 39, and do not include attorneys' fees that may be assessed on appeal," In re Am. President Lines, 779 F.2d at 716, unless an underlying statute deems attorneys' fees to be "costs," Montgomery & Assocs. Inc. v. Commodity Futures Trading Comm'n, 816 F.2d 783, 784 (D.C.Cir. 1987) (Bork, J.) (indicating that attorneys' fees fall within Fed. R.App. P. 39 if the
Fed. R.App. P. 39 provides that the costs taxable by a district court are "(1) the preparation and transmission of the record; (2) the reporter's transcript, if needed to determine the appeal; (3) premiums paid for a supersedeas bond or other bond to preserve rights pending appeal; and (4) the fee for filing the notice of appeal." Fed. R.App. P. 39(e). In addition, Circuit Rule 39 of the Circuit Rules of the United States Court of Appeals for the District of Columbia Circuit further defines the items for which costs are allowed under Fed. R.App. P. 39, stating:
Circuit Rule 39(a), available at http://www.cadc.uscourts.gov/internet/home.nsf/Content/VL%20-%20RPP%20-%20Circuit%20Rules/$FILE/rules20091201rev20091113links.pdf. Circuit Rule 39 goes on to provide that the costs of preparing two sets of briefs and/or segments of appendices for records that are under seal may be assessed "if such costs are otherwise allowable." Circuit Rule 39(d). To erase any doubt that Circuit Rule 39 defines allowable costs, the D.C. Circuit's Handbook of Practice and Internal Procedures expressly states that "[t]he items allowed as costs are set forth in Circuit Rule 39(a)." UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIR., HANDBOOK OF PRACTICE & INTERNAL PROCEDURES 55 (as amended through April 14, 2011).
These rules and the two cited D.C. Circuit cases control this Court's analysis until the D.C. Circuit elects, if ever, to expand its interpretation of how "costs" should be defined for the purpose of a Fed. R.App. P. 7 appeal bond. Accordingly, the plaintiffs' contention that "Fed. R.App. P. 7 is the sole governing rule on appeal bonds" and "there is no other local or federal rule that limits or modifies the authority of this Court to require . . . a bond" simply is not the case. Pls.' First Mot. for Appeal Bond 3. As already indicated, the D.C. Circuit stated in In re American President Lines, 779 F.2d at 716, that the costs available under Fed. R.App. P. 7 are limited to those covered by Fed. R.App. P. 39, in which case Fed. R.App. P. 39 is a federal rule that limits or modifies the authority of this Court to require a bond. In addition, as the Court already cited, Circuit Rule 39 further defines the "costs" that are available under Fed. R.App. P. 39, so that local rule also applies. The Court is aware that the plaintiffs argue in their reply brief that In re American President Lines is "inapposite"
Having resolved that, in this Circuit, a Fed. R.App. P. 7 appeal bond is limited to the costs taxable pursuant to Fed. R.App. P. 39, as well as attorneys' fees to the extent an underlying statute deems such fees to be "costs," the Court now turns to the question of whether the appeal bonds requested by the plaintiffs may include $2,526,981.46 in attorneys' fees. The only statute the plaintiffs cite for the proposition that attorneys' fees should be taxed as "costs" under Fed. Rule App. P. 39 and Fed. R.App. P. 7 is the Cost and Fees provision of the Equal Access to Justice Act, codified at 28 U.S.C. § 2412. Pls.' First Mot. for Appeal Bond 15. In accordance with the D.C. Circuit's decision in Montgomery & Assocs., and the Supreme Court's decision in Marek v. Chesny, 473 U.S. 1, 105 S.Ct. 3012, 87 L.Ed.2d 1 (1985), however, attorneys' fees are permitted only if the applicable statute deems attorneys' fees to be "costs," for example by stating that the court may award "attorney's fees `as part of the costs,'" Marek, 473 U.S. at 9, 105 S.Ct. 3012 (quoting 42 U.S.C. § 1988), or by stating that a prevailing party "`shall be allowed a reasonable attorney's fee to be taxed and collected as a part of his costs,'" Montgomery & Assocs. Inc., 816 F.2d at 784 (quoting 7 U.S.C. § 18(e) (1982)). Here, subsection (a) of the Costs and Fees provision of the Equal Access to Justice Act states that "[e]xcept as otherwise specifically provided by a statute, a judgment for costs, . . . but not including the fees and expenses of attorneys, may be awarded to the prevailing party. . . ." 28 U.S.C. § 2412(a)(1) (emphasis added). In a subsequent subsection cited by the plaintiffs, the statute further states that "[u]nless expressly prohibited by statute, a court may award reasonable fees and expenses of attorneys, in addition to the costs which may be awarded pursuant to subsection (a), to the prevailing party. . . ." 28 U.S.C. § 2412(a)(1). By separately addressing costs vis-à-vis attorneys' fees, the statute could not be clearer that attorneys' fees are not considered to be the same thing as costs and, therefore, according to this Circuit's rules and precedent, attorneys' fees pursuant to the provisions of the Equal Access to Justice Act cited by the plaintiffs are not available under Fed. R.App. P. 39 or Fed. R.App. P. 7.
Because attorneys' fees are not taxable as Fed. R.App. P. 39 costs in this
Because the D.C. Circuit has limited the "costs" that may be taxed pursuant to a Fed. R.App. P. 7 appeal bond, the Court agrees with Ms. Craven that the plaintiffs' actual taxable costs pursuant to Fed. R.App. P. 39 will be closer to $200 than the $34,000 or so asserted by the plaintiffs. Given the plaintiffs' evidence that Ms. Craven has assets "in excess of $919,000," Pls.' Reply Br. 20, the Court is not particularly concerned about the plaintiffs' ability to recover the costs to which they might be entitled under Fed. R.App. P. 39 if they prevail against her on appeal. Moreover, it is unnecessary at this time for the Court to try to divine the actual costs to the plaintiffs with respect to the other appellants against whom they seek an appeal bond when the plaintiffs will retain their right to move for costs pursuant to Fed. R.App. P. 39 and there is no indication that the Harvest Institute Freedmen Federation, LLC, Leatrice Tanner-Brown, William Warrior, Ortencia Ford or Donnelly Villegas will not be able to pay such costs, particularly since they paid the $455 filing fees for their appeals, see Docket Nos. 3817, 3854, 3863. For all these reasons, the Court will exercise its discretion by declining to order an appeal bond.
After concluding that, to the extent the Court may exercise its discretion to order an appeal bond pursuant to Fed. R.App. P. 7 such a bond is limited to the costs allowed under Fed. R.App. P. 39 and attorneys' fees when deemed by an underlying statute to be "costs," the Court finds it necessary to address Ms. Craven's argument in her opposing brief that the plaintiffs' motion for a bond was brought in bad faith and warrants sanctions. While the Court is sympathetic to the plaintiffs' concern that the appeals will delay the administration
For example, on page 3
In addition to claiming without support that this Court has established "practices," the plaintiffs also repeatedly assert that the D.C. Circuit has "construed" Fed. R.App. P. 7 in a certain way without offering any precedent for the asserted construction. For example, on page 9 of their motion the plaintiffs state that "[t]his Circuit. . . [has] construed Rule 7 costs to include attorneys' fees for the preparation and compilation of the record for appeal" but cite no D.C. Circuit case, indeed they cite no case at all, to support this argument. On page 13, the plaintiffs further state that "[t]his circuit . . . has construed Rule 7 costs to include . . . the increased cost of the claims administrator and post judgment interest on the settlement amount" and that "[t]he practice of this Court is in accord," but cite no D.C. Circuit case—again, they cite no case at all—to demonstrate that the "Circuit" has so construed the rule, which is not surprising since there appears to be no such case. The plaintiffs also fail to cite any District Court cases to support their assertion that there is a "practice" in accord with the unsupported Circuit construction. If the plaintiffs have identified cases in which the D.C. Circuit has construed Fed. R.App. P. 7 to include attorneys' fees for the preparation and compilation of the record for appeal or the increased costs of the claims administrator and post-judgment interest, then the Court welcomes them to file a praecipe providing the citations for those cases.
The plaintiffs also cited cases for propositions the cases did not support. On page 9 of their motion the plaintiffs state that "since the Supreme Court first established the right of a non-party objector to appeal in Devlin v. Scardelletti, the objector's obligation to post . . . an appeal bond is common in class action litigation," but the first cited case supporting this point, Adsani v. Miller, 139 F.3d 67 (2d Cir.1998) (Parker, J.), is not a class action case and does not involve a non-party objector. In the second cited case, In re Countrywide Fin. Corp. Customer Data Sec. Breach Litig., No. 3:08-MD-01998, 2010 WL 5147222, at *6 (W.D.Ky.2010) (Russell, J.), the district court denied the motion for an appeal bond. And the last case cited for this proposition, O'Keefe v. Mercedes-Benz USA, LLC, 214 F.R.D. 266 (E.D.Pa.2003) (Van Antwerpen, J.), is an unpublished
As a further example, on page 14 of the motion the plaintiffs state that "[t]he majority rule among jurisdictions is that attorneys' fees should be included in an appeal bond where the litigation involves an underlying statute with a fee-shifting provision," and they quote part of a sentence from International Floor Crafts, 420 Fed. Appx. 6, 17, in which the district court stated that "we endorse the majority view that a Rule 7 bond may include appellate attorneys' fees if the applicable statute underlying the litigation contains a fee-shifting provision. . . ."
In their reply brief the plaintiffs state that they "have not requested that this Court include Rule 38 costs in its pending motion for an appeal bond," Pls.' Reply Br. 3, but in their original motion asserting that the administrative costs of delay are warranted two of the cases they rely on involve situations in which such costs are allowed pursuant to Fed. R.App. P. 38 because the appeals were considered frivolous. Pls.' First Mot. 17 (citing In re Compact Disc Minimum Advertised Price Antitrust Litig., No. MDL 1361, 2003 WL 22417252, *1 (D.Me.2003) (Hornby, J.) (holding that "damages resulting from delay or disruption of settlement administration caused by a frivolous appeal" may be included in a Fed. R.App. P. 7 bond because "in the First Circuit a Rule 7 bond can cover damages assessed under Fed. R.App. P. 38"); In re Pharm. Indus. Average Wholesale Price Litig., 520 F.Supp.2d 274, 279 (D.Mass.2007) (Saris, J.) (same)). Likewise, in another cited case, In re Wal-Mart Wage & Hour Emp't Practices Litig., No. MDL 1735, 2010 WL 786513, *2 (D.Nev.2010) (Pro, J.), the imposition of administrative costs of delay was based on the fact that the district court found the appeals to be "frivolous and . . . tantamount to a stay of the Judgment entered by this Court," which also suggests that Fed. R.App. P. 38 was the basis for awarding administrative costs of delay. The plaintiffs cannot credibly state that they are not requesting Fed. R.App. P. 38 costs but then rely on cases that grant such costs pursuant to that rule.
The Court recognizes that sometimes a litigant's resort to persuasive writing versus objective writing leads to unwitting overzealousness in the presentation of arguments, but the plaintiffs' motion and reply brief go beyond fair advocacy and border on misrepresentation. The Court cannot condone sweeping representations that either the D.C. Circuit or this District Court has established "practices," that the D.C. Circuit has construed rules in ways that it has not, or that this Court essentially can exercise carte blanch with respect to an appeal bond when there plainly is no support for such a representation and the applicable precedent and rules in this jurisdiction
For the foregoing reasons, the Court will deny Plaintiffs' Unopposed Motion for Appeal Bond Pursuant to Federal Rule of Appellate Procedure 7 [Docket No. 3856], Plaintiffs' Second Unopposed Motion for Appeal Bond Pursuant to Federal Rule of Appellate Procedure 7 [Docket No. 3859], and Plaintiffs' Third Unopposed Motion for Appeal Bond Pursuant to Federal Rule of Appellate Procedure 7 [Docket No. 3869]. In light of the disposition of these motions, the Court also will deny as moot Plaintiffs' Unopposed Motion for Expedited Consideration of Plaintiff[s'] Second Unopposed Motion for Appeal Bond Pursuant to Federal Rule of Appellate Procedure 7 [Docket No. 3860]. An appropriate order consistent with this Memorandum Opinion will follow.