Smarter Tools Inc. v. Chongqing Senci Import & Export Trade Co., Ltd.
- Alison Nathan
- 1:18-cv-02714
- U.S. District Court · Southern District of New York
- 2
In Smarter Tools v. Chongqing Senci, Judge Nathan denied an appeal stay but temporarily stayed the February 26 order for STI to seek appellate relief.
Smarter Tools Inc.’s request to pause the district court’s February 26, 2021 arbitration-award order was denied, while a temporary administrative stay was entered to allow it to seek a stay from the Court of Appeals. Chongqing Senci Import & Export Trade Co., Ltd. was affected by the temporary pause.
What happened
In Smarter Tools Inc. v. Chongqing Senci Import & Export Trade Co., Ltd., Smarter Tools Inc. asked the court to pause its February 26, 2021 order while Smarter Tools appealed. That earlier order confirmed an arbitration award in favor of SENCI and denied Smarter Tools’ request to cancel the award.
The court said a party seeking an appeal stay must strongly show likely success, irreparable harm, limited harm to others, and that the public interest supports a stay. Smarter Tools argued that it had incurred litigation costs and that SENCI might take unspecified steps to enforce its money judgment. The court found those points insufficient.
Judge Alison J. Nathan denied Smarter Tools’ motion for a stay pending appeal. The court also entered a temporary administrative stay of the February 26 order so Smarter Tools could seek the same relief from the Court of Appeals, but required it to promptly seek that relief and file a letter by April 12, 2021; otherwise, the administrative stay would end automatically on April 13, 2021.
The detailed version
- Smarter Tools Inc. v. Chongqing Senci Import & Export Trade Co., Ltd. · No. 1:18-cv-02714
- Alison Nathan
- Apr. 8, 2021
Background
Smarter Tools Inc. (STI) moved for a stay pending appeal or a temporary administrative stay. The requested stay concerned the Court’s February 26, 2021 order, which granted Chongqing Senci Import & Export Trade Co., Ltd.’s petition to confirm an arbitration award and denied STI’s cross-petition to vacate the award.
Legal standard
Under Federal Rule of Appellate Procedure 8(a), a district court may stay an order pending appeal. The court considered whether STI had made a strong showing that it was likely to succeed on appeal, whether it would suffer irreparable harm without a stay, whether a stay would substantially injure other interested parties, and where the public interest lay. The court explained that a stay is discretionary and that the requesting party bears the burden of showing that the circumstances justify one.
Court’s analysis
The court concluded that STI had not met the requirements for a stay pending appeal. It stated that the standard for disturbing an arbitration award is exceptionally high and that STI was unlikely to prevail in its effort to do so on appeal. The court also found that STI had not identified irreparable harm. Litigation costs were not irreparable harm, and a stay would not remedy them. The possibility that SENCI might take unspecified actions to enforce its money judgment was also insufficient because that is a harm generally faced by a losing litigant after judgment.
Ruling
The court DENIED STI’s motion for a stay pending appeal, Docket Number 90. The court stated that it would enter a temporary administrative stay of the February 26 order so STI could seek the same relief from the Court of Appeals, provided STI promptly sought that relief. STI was required to file a letter by April 12, 2021, stating that it had moved for a stay in the Court of Appeals. If it had not done so, the administrative stay would terminate automatically on April 13, 2021. STI also had to notify the district court within three days of the Court of Appeals’ decision on its stay motion.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.