Saadeh v. Kagan
- Paul Engelmayer
- 1:20-cv-01945
- U.S. District Court · Southern District of New York
- 3
In Saadeh v. Kagan, Judge Engelmayer denied Kagan’s motion to stay the money judgment pending appeal and waive Rule 62(b)’s bond requirement.
Michael Kagan could not obtain a stay of the money judgment or a waiver of the bond requirement. Rafic Saadeh retained the ability to pursue recovery during the appeal.
What happened
In Saadeh v. Kagan, defendant Michael Kagan asked the court to pause enforcement of the money judgment while his appeal was pending and to excuse the required bond.
The court explained that a bond generally protects the winning party by ensuring payment if the judgment is upheld. Kagan relied on his financial hardship, but the court found that he had not offered an acceptable alternative way to secure the judgment.
Judge Engelmayer denied Kagan’s motion to stay the judgment pending appeal and to waive Rule 62(b)’s bond requirement. The court did not consider whether Kagan was likely to succeed on appeal because those factors do not apply to this type of request.
The detailed version
- Saadeh v. Kagan · No. 1:20-cv-01945
- Paul Engelmayer
- Feb. 14, 2024
Background
Defendant Michael Kagan filed a letter-motion under Federal Rule of Civil Procedure 62(b) seeking two forms of relief: a stay of enforcement of the money judgment while an appeal was pending, and a waiver of the rule’s supersedeas-bond requirement. A supersedeas bond is security intended to protect the prevailing party if the judgment is affirmed but payment becomes difficult to obtain during the appeal.
Bond-Waiver Standard
The court explained that Rule 62(b) ordinarily allows a stay of execution of a money judgment when the judgment debtor posts a supersedeas bond. A district court has discretion to waive that requirement. The court considered the Second Circuit’s five nonexclusive factors: the complexity of collecting the judgment; the time needed to obtain payment after affirmance on appeal; the court’s confidence that funds would be available; whether the debtor’s ability to pay made a bond unnecessary; and whether requiring a bond would leave other creditors insecure because of the debtor’s precarious finances.
Kagan argued that the bond should be waived because the court had previously recognized his financial hardship when allowing him to proceed without paying court fees. The court stated that the bond-waiver factors serve a different purpose. They focus on protecting the prevailing party’s ability to recover in full while protecting the judgment debtor against the risk that payment cannot be recovered if the judgment is reversed.
Court’s Analysis
The court found a real risk that prevailing party Rafic Saadeh would not recover the judgment in full. It also stated that this risk could increase if Saadeh could not pursue recovery during an appeal that might take more than a year. The court concluded that Kagan’s claimed inability to pay the judgment or obtain a bond supported denying the waiver because Kagan had not provided an acceptable alternative means of securing the judgment.
The court further held that it did not need to consider the likelihood of success on appeal or other traditional stay factors used for stays involving injunctions. Those factors do not apply to a request to stay a money judgment under Rule 62(b).
Disposition
The court denied Michael Kagan’s motion to stay the judgment pending appeal and to waive Rule 62(b)’s bond requirement. The opinion addressed the stay and bond request, not the merits of the underlying judgment.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.