Satisfaction? Selling Off Appellate Rights

Bad cases make bad law, and it seems that any case involving Crystal Cox is, almost by definition, bad.  Bad, bad, bad.  Which is why it's painful to see the newest issue raised in one of the most bizarre cases around, Obsidian Finance Group, LLC v. Cox . 

Having obtained a judgment against Cox, and Cox having slightly less blood than a rock with which to satisfy the judgment or post a bond to stay execution pending appeal, the plaintiffs have moved forward to execution while Cox pursues, though her pro bono counsel, Eugene Volokh, an appeal. 

It's worth noting that Eugene's involvement reflects a true dedication to the underlying First Amendment cause, rather than any particular love of the individual.  That said, I can't help but wonder whether there are any regrets, given that his client is the one no experienced lawyer would allow near his office, and the significance of the free speech issues at stake are not, upon reflection, nearly as important as they first appeared. Indeed, the issues are fact-bound, and the facts are awfully ugly.

Yet, this bad case begets another bad issue, as Eugene explains:

1. Obsidian Finance and Kevin Padrick sue Crystal Cox. They win at trial, and get a large judgment.
2. Cox appeals on First Amendment grounds (I’m representing her on appeal). Cox has very little money, so she can’t put up a so-called “supersedeas bond” (a bond for the full amount of the judgment) that is required to keep plaintiffs from seizing her assets to execute the judgment. But that doesn’t block her appeal, since under federal law one generally doesn’t need to put up a bond in the amount of the judgment to appeal — one only needs the bond to stop execution on the judgment pending appeal.
3. But plaintiffs have a different view: They go to Oregon court, register the judgment, get a writ of execution, and ask the sheriff to seize and sell to the highest bidder Cox’s “intangible personal property,” in the form of ... Cox’s right to appeal.

The reaction is a motion before the district court for a stay of execution.  The motion has been fully briefed, opposed and replied, with Eugene taking the early lead on heft.  The core question is whether a party can execute a judgment against the intangible right to appeal, and thus prevent the appeal of the judgment.  On its surface, it just seems utterly wrong.

While the papers go on at length wrangling over procedural issues, where the plaintiff's fairly straightforward contentions, particularly about Younger abstention over the state court execution of a judgment, appear far more persuasive than Eugene's efforts to get the district court to stick its nose in.  But the core issue, whether the right to appeal can be sold out from under a litigant who can't afford to post bond, is one with far larger implications.  And of course, it has to arise in this case, with this defendant.

Eugene finally gets around to mentioning this problem at page 10 of his memorandum in support of the motion:

Yet if plaintiffs’ end run around the Rules were accepted, then poor defendants in civil cases would routinely lose their rights to appeal. Defendants would not be able to afford to get a bond for the amount of the judgment. Plaintiffs would then be able to get sheriffs to levy on the defendants’ right to pursue the appeal. Plaintiffs would buy the right cheaply at the sheriff’s sale, since nobody would be competing with them at the auction. And they would then use the newly acquired right to drop the appeal against them.

The appeal bond requirement that the Federal Rules rejected would thus come in through the back door. Poor defendants would be unable to effectively challenge the judgments against them. And the development of the law would be distorted because appellate courts would be unable to hear the defendants’ appeals. This is not consistent with the system that the Rules strive to create.

Well, yeah. That's a problem, and that's exactly what would happen. It would happen to Crystal Cox. It would happen to any other poor litigant, unable to bond a stay of execution.

While some would argue that the losing defendant doesn't deserve the right to appeal, as it will burden the prevailing plaintiff with the cost of appeal, and should the defendant lose on appeal, the plaintiff will have no chance of recovering a bill of costs since the defendant can't cover the initial judgment, that's not how the system is supposed to work. 

An appeal as of right is an integral part of the system. Courts aren't perfect, and even the poor are entitled to review.  At least that's the way I always thought it was supposed to work. 

David Aman, representing Obsidian in opposition to the motion, has come up with some caselaw supporting the proposition that the right to appeal is one of the intangible rights against which the plaintiff is entitled to execute judgment.  He contends that if Cox wants to appeal, all she need do is bond her judgment, thus assuring plaintiff of recovery if she loses on appeal.  If she can't or won't, then the plaintiff is entitled to do whatever he can to collect, and that includes "choses in action," including her appeal.

The underlying issue is disturbing, in that depriving a poor person of their right to appeal by what Eugene properly characterizes as an "end run" has implications for all poor defendants.  It is not, as Eugene argues, harmless to the opposition to stay execution despite the absence of a bond, as there are real costs associated with defending against an appeal. On the other hand, that's part of the scheme of civil litigation, and the burden isn't so great as to justify depriving poor litigants of their right to appeal.

The one aspect that remains unclear is whether Eugene brought his motion in the right court for the right relief.  It seems that he might have been better off moving for relief before the state court, under whose jurisdiction execution would happen, and thus eliminate the Younger abstention issue. The other choice was the 9th Circuit, who could have ruled that they would consider the appeal regardless of the sale of Cox's right to appeal as a matter of their own supervisory authority.

But why must it happen that this issue arises in a case with such an unsavory hero?  Why does it always seem to happen that way?  Nonetheless, even the most unsympathetic litigant is entitled to the same rights as the beloved one, and even the deservedly poor are entitled to the legal protections afforded the fabulously wealthy.  And so, we're stuck with another Crystal Cox issue, and forced to root for the dark side.











© 2012 Simple Justice NY LLC. This feed is for personal, non-commercial & Newstex use only. The use of this feed on any other website is a copyright violation. If this feed is not via RSS reader or Newstex, it infringes the copyright.

Source: http://blog.simplejustice.us/2013/01/12/satisfaction-selling-off-appellate-rights.aspx?ref=rss

employment lawyer employment lawyer san diego employment lawyers estate attorney