Williams Sports Rentals Inc. v. Willis ( 2023 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 IN RE: COMPLAINT AND PETITION OF No. 2:17-cv-00653-KJM-JDP WILLIAMS SPORTS RENTALS, INC., AS 12 | OWNER OF A CERTAIN 2004 YAMAHA ORDER 13 WAVERUNNER FX 140 FOR EXONERATION FROM OR LIMITATION 14 | OF LIABILITY, 15 | MARIAN LATASHA WILLIS, on behalf of the Estate of RAESHON WILLIAMS, 16 7 Respondent/Counter Claimant, 18 v. 19 | WILLIAMS SPORTS RENTALS, INC. Petitioner/Counter Defendant 20 WILLIAMS SPORTS RENTALS, INC. 21 Petitioner, Counter Defendant, and Third-party Plaintiff, 22 v. 23 4 THOMAS SMITH, KAI PETRICH, BERKELY EXECUTIVES, INC., ZIP, INC., 25 and DOES 1-10 26 Third-party Defendants. 27 1 Respondent Willis moves this court to stay all further proceedings pending an appeal of 2 this court’s prior order. For the reasons below, the court denies the motion to stay. 3 I. BACKGROUND 4 The previously assigned district judge detailed the facts and procedural history of this 5 case in a prior order. See Prior Order (July 27, 2020), ECF No. 113. There, the court found the 6 single claimant exception of the Limitation Act applied, lifted the initial stay on state court 7 proceedings and stayed the federal court proceeding pending resolution of the question of liability 8 in state court. Id. at 9. Then, in 2022, this court found the single claimant exception no longer 9 applied, lifted the federal stay and enjoined all other proceedings related to this action. Prior 10 Order (Dec. 9, 2022), ECF No. 127. Willis appealed this order. See ECF No. 129. Willis 11 appealed two issues in particular: the court’s application of the single claimant exception and its 12 authority to issue an injunction. See Mot. at 6–7, ECF No. 132-1. Willis now moves this court to 13 stay its proceedings pending resolution of the appeal. Id. Petitioner Williams Sports Rental 14 (WSR) opposes, Opp’n, ECF No. 143, and Willis has replied, Reply, ECF No. 148. The court 15 took the matter under submission without hearing oral arguments. ECF No. 156. 16 II. LEGAL STANDARD 17 “A stay is not a matter of right, even if irreparable injury might otherwise result” to the 18 appellant. Nken v. Holder, 556 U.S. 418, 433 (2009) (quoting Virginian Ry. Co. v. United States, 19 272 U.S. 658, 672 (1926)). Rather, “[a] request for a stay pending appeal is committed to the 20 exercise of judicial discretion.” Doe #1 v. Trump, 957 F.3d 1050, 1058 (9th Cir. 2020). The 21 moving party “bears the burden of showing that the circumstances justify an exercise of that 22 discretion.” Nken, 556 U.S. at 433–34. “The standard for evaluating stays pending appeal is 23 similar to that employed by district courts in deciding whether to grant a preliminary injunction.” 24 Lopez v. Heckler, 713 F.2d 1432, 1435 (9th Cir. 1983). Four considerations govern judicial 25 discretion in ruling on a motion to stay: “(1) whether the stay applicant has made a strong 26 showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably 27 injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties 28 interested in the proceeding; and (4) where the public interest lies.” Hilton v. Braunskill, 1 481 U.S. 770, 770–71 (1987); Nken, 556 U.S. at 433–34. “The first two factors . . . are the most 2 critical”; the last two are reached only “[o]nce an applicant satisfies the first two factors.” Nken, 3 556 U.S. at 434, 435. 4 Courts can apply a “sliding scale” when weighing these factors, wherein “a stronger 5 showing of one element may offset a weaker showing of another.” Alliance for the Wild Rockies 6 v. Cottrell, 632 F.3d 1127, 1131 (9th Cir. 2011); Leiva-Perez v. Holder, 640 F.3d 962, 966 (9th 7 Cir. 2011) (per curiam) (applying the sliding scale). 8 III. ANALYSIS 9 While Willis does not explicitly discuss the four considerations outlined above, the court 10 construes Willis’s motion as arguing: (1) she is likely to succeed on the merits in challenging this 11 court’s finding of the inapplicability of the single claimant exception and the scope of the related 12 injunction and (2) she will be irreparably harmed absent a stay. See generally Mot. 13 A. Likelihood of Success 14 To show a likelihood of success, “petitioners need not demonstrate that it is more likely 15 than not that they will win,” but must show there is a “substantial case for relief on the merits.” 16 Leiva-Perez, 640 F.3d at 966, 968. The court finds Willis is unlikely to succeed on the merits 17 because the single claimant exception no longer applies and the court has discretion to impose an 18 injunction. 19 When a petitioner first invokes the protection of the Limitation Act, as WSR did here, 20 ECF No. 1, the court must “issue[] an injunction that prevents the filing of any other actions 21 against the owner if it involves related claims” In re Complaint of Ross Island Sand & Gravel, 22 226 F.3d 1015, 1017 (9th Cir. 2000). The “court as a general rule has broad discretion in 23 deciding whether to dissolve an injunction under the Limitation of Liability Act.” Newton v. 24 Shipman, 718 F.2d 959, 961 (9th Cir. 1983). This broad discretion is “narrowly circumscribed” 25 when the single claimant exception applies, wherein the court must dissolve the injunction. Id. 26 In its prior order, this court found the cross complaints against WSR filed in state court by 27 Kai Petrich and Sentinel constituted multiple separate claims for damages, removing this action 28 from the single claim exception. See Prior Order (Dec. 9, 2022) at 5–7. Willis now argues these 1 “cross-complaints are manifest shams and do not threaten WSR’s right to limitation in any real 2 way.” Mot. at 10. However, Willis has not explained why these cross-complaints are “shams” in 3 prior briefing or in the present motion. See, e.g., Prior Mot.; ECF No 117. The court affirms its 4 finding the single claimant exception no longer applies in this action. 5 Willis next argues this court’s injunction is “overbroad” because it enjoined “not just the 6 state-court proceedings against WSR but also ‘the continued prosecution of any legal proceedings 7 of any nature.’” Mot. at 6–7. There is no indication of any other proceedings besides those in the 8 Alameda County Superior Court and this court at this time. Because this court had jurisdiction to 9 impose the injunction at the outset of this case, In re Complaint of Ross Island Sand & Gravel, 10 226 F.3d at 1017, and the discretion to dissolve the injunction when it found the single claimant 11 exception applied, Newton, 718 F.2d at 961, it also had the discretion to reinstate the injunction 12 upon finding the action no longer fell under the exception, Ex parte Green, 286 U.S. 437, 439 13 (1932) (holding district courts should “retain the petition for a limitation of liability . . . [in] the 14 unlikely event that the right of petitioner to a limited liability might be brought into question in 15 the state court,. . . or the case otherwise assumes such form . . . as to bring it within the exclusive 16 power of a court of admiralty.”). Willis has not shown she has a substantial likelihood of success 17 on the merits. Leiva-Perez, 640 F.3d at 968. 18 B. Irreparable Harm 19 A petitioner moving for a stay pending appeal must show irreparable harm is “likely to 20 occur during the period before the appeal is decided.” Doe #1, 957 F.3d at 1059. Here, Willis 21 argues “the surprising breadth” of this court’s injunction will cause “disorder.” Mot. at 11. 22 Specifically, Willis argues if this court does not grant a stay, the “Ninth Circuit may not have the 23 opportunity to decide whether [this court’s prior order] violates the Anti-Injunction Statute before 24 [Willis] loses” her June 2023 state court trial date. Mot. at 10; see Req. Judicial Notice, ECF No. 25 126. At the same time, Willis also states “the decision to reinstate the anti-suit injunction as to 26 WSR is not particularly pressing” because Willis’s deadline to try her state court claims does not 27 expire until 2026. Mot. at 11. Willis misunderstands the posture of the matter at this point. The 28 court has already enjoined the state court proceedings. An issuance of a formal stay pending 1 appeal would not affect the preexisting injunction, nor would it affect the Ninth Circuit’s 2 consideration of Willis’s appeal. Because Willis makes no other showing of irreparable harm, 3 she has not satisfied this factor. 4 Willis has not shown either a likelihood of success on the merits or irreparable harm. She 5 also has not discussed whether a stay would injure other parties in this matter or where the public 6 interest lies. She has not met her burden. The court denies the motion to stay pending appeal. 7 Nken, 556 U.S. at 434–35. 8 IV. CONCLUSION 9 For the reasons above, the court denies Willis’s motion to stay this action pending 10 appeal. 11 This order resolves ECF No. 132. 12 IT IS SO ORDERED. 13 DATED: April 12, 2023.