After Entry of Judgment, District Court Orders Deposit of Amount of Judgment Plus 20% Interest for One Year in order to Obtain Stay of Execution Pending Appeal

June 30, 2014

Innovention Toys, LLC prevailed in a patent infringement action against MGA Entertainment. After the Court entered a final judgment, the parties agreed that execution of the judgment should be pending resolution of post-judgment motions and appeal but disagreed regarding the amount Defendant MGA should deposit with the district court as security.

MGA argued that it should only deposit the amount of the judgment plus one year of post-judgment interest at 0.10%. Innovention asserted that MGA should deposit the amount of the judgment plus 20%, citing Local Rule 62.2.

The district court "has authority to stay execution of judgment pending resolution of post-judgment motions, and to stay execution pending appeal if the appellant files a supersedeas bond. Fed. R. Civ. P. 62(b), (d)." Local Rule 62.2 dictates "[a] supersedeas bond staying execution of a money judgment must be in the amount of the judgment plus 20% of that amount to cover interest, cost and any damages award, unless the court directs otherwise."

The district court also stated that "[d]epositing an amount in the registry of the district court is the "functional equivalent of a supersedeas bond." Feldman v. Philadelphia Hous. Auth., No. 91-5861, 1994 WL 46514, at *3 (E.D. Pa. Feb. 16, 1994).

The district court then found it could identify no cause to depart from Local Rule 62.2.
"Accordingly, MGA may deposit into the registry of the Court the amount of the judgment ($6,868,027.58) plus 20% ($1,373,605.52), for a total of $8,241,633.10. The check in that amount should made payable to "Clerk U.S. District Court." Upon deposit of that amount, execution of the Judgment shall be stayed pending resolution of post-judgment proceedings and any appeals. Disbursement of the fund held in the registry of the Court shall be made only by an order of the Court on motion filed by either party pursuant to Local Rule 67.3."

Innovention Toys, LLC v. MGA Entertainment, Case No. 07-6510 (E.D. La. June 5, 2014)

The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. We represent inventors, patent owners and technology companies in patent licensing and litigation. Whether pursuing patent violations or defending infringement claims, we are aggressive and effective advocates for our clients. For more information contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.