sep , n11okey cobb and their minor child, haley cobb ("appellees") against...
TRANSCRIPT
No.
In the Supreme Court of Ohio
APPEAL FROM THE COURT OF APPEALS
ELEV$NTH APPELLATE DISTRICT
TRUMBULL COUNTY, OHIoCAsE No. 2011-T-0049
HALEY NICOLE COBB, a.minor by DEBRA COBB, et aL,
Plaintiffs-Appellees,
V.
TARA SHIPMAN, M.D., et al.,
Defendants-Appellants.
MEMORANDUM IN SUPPORT OF JURISDICTION OF APPELLANTS
TARA SITYPIVIAN, M.D. AND ASSOCIATES IN FEMALE HEALTH, INC.
Martin White, Esq. (0009584)154 Park Avenue, NEWarren, OH 44482
Michael Djordjevic, Esq.Djordjevic, Casey & MarrnarosSuite 201 at Maiden Lane17 South Main StreetAkron, OH 44308
Norman A. Moses, Esq.100 Marwood CircleBoardman, OH 44512
Attorneys for Plaintiffs-Appellees
Douglas G. Leak (0045554) (Counsel ofRecord)Roetzel & Andress, LPA1375 East Ninth Street, Suite 900Cleveland, OH 44114216-623-0150 / 216-623-0134 faxdleak a(7xalaw.com
Attorney for Defendants-Appellants TaraShipman, M.D. and Associates in FemaleHealth, Inc.
SEP ", N11
CLt0 1A 'a)URtSUPNEME COURI Of OHIO
TABLE OF CONTENTS
Table Of Authorities ..........................................................................................................................
I. Explanation Of Why This Case Is Of Public And Great General Interest .................................
II. Statement Of The Case And Facts .............................................................................................
III. Argument In Support Of Propositions Of Law ..........................................................................
PROPOSITION OF LAW NO. 1: In An Interlocutory Appeal From DiscoveryOrders Pertaining To Prejudgment Interest Proceedings, The Posting Of A
Supersedeas Bond Is Not Required On A Jury Verdict That Is Not Yet A FinalAppealable Order As Long As Prejudgment Interest Proceedings Remain PendingAnd, Therefore, The Eleventh District's Judgment Entry Ordering The Posting Of
A $10.5 Million Supersedeas Bond Is Legally Lawed And Inconsistent With This
Court's Precedents ....................................................................................................................
PROPOSTTION OF LAW NO. 2: The Error In The Eleventh District's LegallyFlawed Judgment Entry Is Compounded By The Erroneous Ordering Of ASupersedeas Bond In An Amount That Is Unrealistic, Unattainable And WouldCause Irreparable Harm ...........................................................................................................
IV. Conclusion ................................................................................................................................
Certificate of Service .........................................................................................................................
Appendix
Judgment Entry of the Trumbull County Court of Appeals,Eleventh Appellate District of July 21, 2011 ................................................................ Appx 1-10
TABLE OF AUTHORITIES
CASES PAGE
Dennerline vs. Atterholt, Indiana Court ofAppeals, Case No. 49AD4-0610-CV-557 ..................12
Miller vs. International Fidelity 113 Ohio St.3d 474, 866 N.E.2d 1059, 2007-Ohio-2457 ...... ......... ............................................................................... 1,2,3,6,8,10
Stewart vs. Zone Cab of Cleveland, Cuyahoga App. No. 79317, 2002-Ohio-335 ...........................6
Teuteru vs. P&FEnterprises,Inc. (1970) 21 Ohio App. 2d 122 ......................................................9
Texaco vs. Pennzoil, 784 F. 2d 1113, 1154 (2"' Circuit, 1984) .....................................................11
Union Savings Bank vs. Washington Township Board of ZoningAppeals, MontgomeryApp. No. 15858, 1996 YVI 535304 ....................................................................................................9
ii
I. EXPLANATION OF WHY THIS CASE IS OF PUBLIC AND GREAT GENERAL
INTEREST
This case is of great public and general interest because the Eleventh District Court of
Appeals has redefined the legal requirements for the posting of a supersedeas bond in
Interlocutory Appeals. The Eleventh District has improperly expanded the supersedeas bond
requirement to Interlocutory Appeals from discovery orders in pending prejudgment interest
proceedings even though the underlying jury verdict is not a final appealable order, and cannot
be reversed, altered or changed during the pendency of the Interlocutory Appeal. The Seventh
District's ordering of a $10.5 million supersedeas bond during an Interlocutory Appeal from
discovery orders concerning prejudgment interest proceedings constitutes a legal divergence and
misinterpretation of this Court's precedents that warrants this Court's review.
In Miller vs. International Fidelity 113 Ohio St.3d 474, 866 N.E. 2d 1059, 2007-Ohio-
2457, this Court held that the filing of a Motion for Prejudgment Interest immediately renders a
Trial Court's judgment on a verdict a non-final appealable order. Consequently, during the
pendency of prejudgment interest proceedings and any ancillary Interlocutory Appeal involving
the prejudgment interest proceedings, a verdict cannot be reversed, altered or changed and,
consequently, will remain intact throughout the entirety of the Interlocutory Appeal. In
accordance with this Court's decision in Miller, the logical legal conclusion is that there is no
requirement for a party to post a supersedeas bond on a verdict that in no way can be adversely
affected by an hiterlocutory Appeal. In other words, since an appeal pertaining to discovery
orders in prejudgment interest proceedings does not seek to "supersede" the jury verdict, a
supersedeas bond is not required to secure that jury verdict pending the Interlocutory Appeal.
This ease is of such public and great general interest because the Eleventh District has
issued a Judgment Entry with respect to the requirement of a supersedeas bond that is legally
1
unsound and wholly inconsistent with this Court's holding in the Miller decision. If the Eleventh
District's Judgment Entry is permitted to stand, confusion and uncertainty throughout Ohio will
result with respect to the requirement of posting a supersedeas bond in Interlocutory Appeals,
especially those involving appealable discovery orders in prejudgment interest proceedings.
Resolution of the legal issues involving non-appealable verdicts, Interlocutory Appeals and
supersedeas bonds is important to the public and is of great general interest to all litigant
throughout Ohio.
This case is of further public and great general interest because not only did the Eleventh
District order the posting of a supersedeas bond that is not legally warranted, the Eleventh
District compounded this error by ordering a $10.5 million supersedeas bond that is unrealistic,
unattainable and would inevitably cause irreparable harm. The Eleventh District effectively
awarded AppeUees a financial windfall by ordering a supersedeas bond which is not reflecfive of
what Appellees could ever realistically recover on the jury verdict.
The errors in the Eleventh District's Judgment Entry violate the fimdamental legal
principles involving supersedeas bonds. There can be no question that the Eleventh District's
Judgment Entry eonstitutes a legal divergence from this Court's decision in Miller and other
precedents. As a result of the Eleventh District's inconsistent and contradictory Judgment Entry,
there will be confusion and uncertainty with respect to requirements of a supersedeas bond in
Interlocutory Appeals, including those involving prejudgment interest proceedings.
The legal issues presented herein have implications far beyond the parties of this case and
resolution of the issues will guarantee all litigants in Ohio with fair and equitable treatment. This
Court now has the opportunity to provide all Ohio Courts and litigants with guidance and
clarification of the law surrounding supersedeas bonds and Interlocutory Appeals. This Court
2
should accept jurisdiction of this case in order to correct the Eleventh District's legally flawed
Judgment Entry.
II. STATEMENT OF TIIE CASE AND FACTS.
This is a medical malpractice action that was brought by Plaintiffs-Appellees Debra and
Okey Cobb and their minor child, Haley Cobb ("Appellees") against Defendants-Appellants Tara
STripman, M.D. and Associates in Female Health, Inc. ("Dr. Shipman") and several other
defendants. After settling their claims against the co-defendants for $6.5 million, Appellees then
pursued their claims against Dr. Shipman.
On September 28,2011 a. jury trial commenced. The jury subsequently returned a verdict
in favor of Appellees and on October 21, 2010, the Trial Court entered judgment on the verdict
in the amount of $12,102,000.00. Then, on January 11, 2011, the Trial Court reduced the verdict
amount to $9,702,000.00 by applying a set-off for Appellees' settlement with the co-defendants.
On October 28, 2010, Appellees filed a Motion for Prejudgment hiterest. Of importance,
the filing of Appellees' Motion for Prejudgment Interest innnediately rendered the Trial Court's
judgment on the verdict a non-final appealable order/judgment pursuant to this Court's decision
in Miller. Consequently, Dr. Shipman, to date, has been precluded from exercising her right to
appeal from the jury verdict so long as the prejudgment interest proceedings remain before the
Trial Court.
During the course of the prejudgment interest proceedings, several discovery disputes and
issues materialized between the parties. On May 17, 2011, the Trial Court issued two discovery
orders which are presently the subject of Dr. Shipman's Interlocutory Appeal pending in the
Eleventh District. Dr. Shipman's appeal before the Eleventh District involves the Trial Court's
prejudgrnent interest discovery orders compelling the production of privileged and protected
3
materials and information.
After Dr. Shipman filed her Nofice of Appeal with the Eleventh District, Dr. Shipman
initially sought at the Trial Court level on May 20, 2011 a Stay of the Trial Court's proceedings,
including any attempts by Appellees to execute on the jury's verdict.' Dr. Shipman argaed that
she was entitled to a Stay of all proceedings and execution without the need of the posting of a
supersedeas bond. It was Dr. Shipman's position that since the jury's verdict could not be
reversed, altered or changed during the pendency of her Interlocutory Appeal that there was no
need for a supersedeas bond in order to secure the jury's verdict.
On May 23, 2011, Appellees filed their Memorandum in Response to Dr. Shipman's
Motion for Stay of Execution. Appellees did not oppose a Stay of the proceedings. But,
Appellees argued that any Stay should be accompanied with a supersedeas bond in an amount in
excess of $20,000,000.00. Appellees' request for a supersedeas bond in an amount in excess of
$20,000,000.00 encompassed a monetary amount for any potential prejudgment interest award.
Thereafter, Appellees orally withdrew their request for a supersedeas bond that included any
potential award for prejudgment interest, which to this day remains pending before the Trial
Court.
On May 25, 2011, Dr. Shipman filed her Reply Brief to Appellees' Memorandum In
Response. Dr. Shipman submitted her Reply Brief in order to clarify for the Trial Court that a
supersedeas bond was not required in this case in order to Stay all Trial Court proceedings
pending Dr. Shipman's Interlocutory Appeal. Dr. Shipman argued that since her Interlocutory
Appeal did not involve the jury's verdict and it was not a final appealable order, no supersedeas
bond was required on a jury verdict that was not presently being challenged upon appeal.
I Dr. Shipman sought a Stay because of her concerns that Appellees would take some aetion withrespect to the jury verdict during the pendency of the Interlocutory Appeal.
4
The Trial Court conducted an informal oral hearing regarding Dr. Shipman's Motion for
Stay. The Trial Court ordered that the parties file additional briefs on the issues by June 7, 2011.
On June 7, 2011, Dr. Shipman filed her Supplemental Brief in Support of her Motion for Stay.
Dr. Shipman provided the Trial Court with fiuther legal support for why no supersedeas bond
was required for her Interlocutory Appeal from the prejudgment interest discovery orders. Once
again, Dr. Shipman argued that since the jury's verdict was not an issue in the Interlocutory
Appeal and was not yet appealable, a supersedeas bond was not required in order to obtain a Stay
pending an Interlocutory Appeal involving the prejudgment interest discovery orders.
On June 15, 2011, the Trial Court issued its Judgment Entry granting Dr. Shipman's
Motion for Stay but only upon the posting of a supersedeas bond or other similar security in the
amount of $14,533,000.00. In its Judgment Entry, the Trial Court agreed that in certain cases, a
supersedeas bond is not required. in order to obtain a Stay. However, the Trial Court erroneously
found that although the jury verdict is not yet appealable and, thus, cannot yet be challenged, it
still constitutes a judgment worth securing with a supersedeas bond.
The Trial Court compounded its error with respect to the posting of a supersedeas bond
by ordering that an adequate amount to Stay execution of the jury verdict was $14,553,000.00.
Clearly, requiring Dr. Shipman to post a supersedeas bond in the amount of $14,553,000.00 was
unrealistic, impracticable and would undoubtedly cause Dr. Shipman irreparable harm. Dr.
Shipman's predicament was that a $14,553,000.00 bond could not realistically be posted and,
consequently, she was placed into a situation in which she could be forced to abandon her appeal
or risk execution on the jury verdict.
Dr. Shipman then sought relief from the Eleventh District so that it could correct the legal
error committed by the Trial Court whereby the Trial Court improperly ordered that a
5
supersedeas bond be posted on a jury verdict that was not the subject of the Interlocutory Appeal.
On June 30, 2011, Dr. Shipman filed a Motion Pursuant to App. R. 7 For Stay of Proceedings
Without The Posting of a Supersedeas Bond. Dr. Shipman similarly argued that because the
jury's verdict during the pendency of the Interlocutory Appeal could not be reversed, altered or
changed and would remain intact throughout the entirety of the Interlocutory Appeal, Dr.
Shipman should. not be required to post a supersedeas bond in order to obtain a stay of the Trial
Court proceedings. Dr. Shipman then argued, altematively, that if the Eleventh District was
inclined to order the posting of a supersedeas bond that it should be in an amount reflective of
what Appellees could realistically collect on the jury's verdict.
On July 6, 2011, Appellees filed their Memorandum in Opposition to Dr. Shipman's
Motion for Stay. Then, Dr. Shipman filed her Reply Brief on July 18, 2011. Since the legal
issues were fiully already briefed on Dr. Shipman's position that no supersedeas bond was
required pending her Interlocutory Appeal, Dr. Shipman only addressed Appellees'
unsubstantiated claims that Dr. Shipman would not be irreparably harmed if she was personally
required to post an exorbitant supersedeas bond.
On July 21, 2011, the Eleventh District issued its Judgment Entry ordering that a Stay of
the Trial Court proceedings, including execution on the jury's verdict, required the posting of a
$10.5 million supersedeas bond (Appx 1-10). With respect to the argnment that no supersedeas
bond was required to secure the non-final appealable jury verdict, the Eleventh District initially
acknowledged that the jury verdict was "not yet final" pursuant to this Court's decision in Miller.
(Appx. at 6). Yet, the Eleventh District relied upon the pre-Miller decision of Stewart vs. Zone
Cab of Cleveland, Cuyahoga App. No. 79317, 2002-Ohio-335 to erroneously conclude that the
6
jury's verdict was a "fmal judgment." (Id.) Consequently, the Eleventh District erroneously
concluded that a supersedeas bond was required pending Dr. Shipman's Interlocutory Appeal.
With respect to the amount of the supersedeas bond, the Eleventh District set the amount
at $10.5 million. The Eleventh District based its ordering of a $10.5 million supersedeas bond
on the impression that Dr. Shipman could. not prove that she could not obtain such a bond (Id. at
7-10).
On August 1, 2011, Dr. Shipman filed a Motion for Reconsideration pursuant to App. R.
26(A). In her Motion for Reconsideration, Dr. Shipman offered evidentiary proof that she could
not be personally approved for a supersedeas bond in the amount of $8.5 niillion. Thereafter, Dr.
Shipman timely filed a Reply Brief on August 15, 2011 with further evidentiary materials
establishing that Dr. Shipman was outrightly rejected for a supersedeas bond. However, the
Eleventh District never considered Dr. Shipman's timely filed Reply Brief in light of the fact that
it denied Dr. Shipman's Motion for Reconsideration on August 12, 2011, three days before the
filing of her Reply Brief. After it was brought to the attention of the Eleventh District that it
failed to consider Dr. Shipman's Reply Brief, on August 26, 2011, the Eleventh District, once
again, renewed its detemiination that Dr. Shipman was required to post a $10.5 million
supersedeas bond.
It is clear that the legal conflict and confusion in the Eleventh District's jurispnxdence
with respect to the requirement of a supersedeas bond in an Interlocutory Appeal requires
guidance and clarification from this Court. This Court now has the opportunity to provide all
Ohio Appellate Courts and Trial Courts with clarification on the law regarding supersedeas
bonds in Interlocutory Appeals.
7
III. ARGUMENT IN SUPPORT OF PROPOSITIONS OF LAW
PROPOSITION OF LAW NO. 1: In An Interlocutory Appeal From DiscoveryOrders Pertaining To Prejudgment Interest Proceedings, The Posting Of ASupersedeas Bond Is Not Required On A Jury Verdict That Is Not Yet A FinalAppealable Order As Long As Prejudgment Interest Proceedings Remain PendingAnd, Therefore, The Eleventh District's Judgment Entry Ordering The Posting OfA $10.5 Million Supersedeas Bond Is Legally Lawed And Inconsistent With This
Court's Precedents
Dr. Shipman does not dispute that when the time is ripe for her to exercise her right to
appeal from the jury's verdict, a supersedeas bond may be required pursuant to R.C. 2505.09.
But, that time has not yet materialized because the jury's verdict is not a final appealable order
as long as Appellees' Motion for Prejudgment Interest remains pending. In other words, Dr.
Shipman cannot seek to supersede the jury verdict until there is a final ruling on Appellees'
Motion for Prejudgment Interest.
In accepting jurisdiction and reversing the Eleventh District's Judgment Entry, this Court
need not look any fnrther than the plain language of R.C. 2505.09. The relevant language of
R.C. 2505.09 that mandates the posting of a supersedeas bond is that the supersedeas bond is
posted for the "final order, judgment, or decree that is sought to be superseded." (Emphasis
added). With respect to a "final order," it is undisputed that the jury's verdict is not a final order
since the prejudgment interest proceedings remain unresolved. Miller, supra. Since the jury's
verdict in this case is not a final order, the posting of a supersedeas bond pursuant to R.C.
2505.09 is not appflcable, and, therefore, the Eleventh District's Judgment Entry is legally
flawed.
Next, R.C. 2505.09 requires that a supersedeas bond be posted on the judgment or decree
"sought to be superseded." In this case, the jury's verdict is not an issue upon appeal since it is
not yet a final appealable order. As such, Dr. Shipman's appeal from the Trial Court's
8
interlocutory prejudgment interest discovery orders does not seek to "supersede" the jury's
verdict. In fact, Dr. Shipman is prohibited from challenging the jury's verdict via an appeal until
the prejudgment interest proceedings are resolved. Simply put, the jury verdict cannot be
disturbed and will remain fully intact pending Dr. Shipman's Interlocutory Appeal.
Consequently, the Eleventh District erred in ordering the posting of a supersedeas bond pursuant
to R.C. 2505.09.
In addition to ignoring the plain language of R.C. 2505.09, the Eleventh District failed to
recognize the case law in Ohio which supports Dr. Shipman's position that a supersedeas bond is
not required because the jury's verdict is not the subject of her Interlocutory Appeal. As the
Eighth District Court of Appeals stated in Teuteru vs. P & F Enterprises, Inc. (1970) 21 Ohio
App. 2d 122, a supersedeas bond operates to stay the execution of a judgment while that
judgment is appealed to a higher court. In Union Savings Bank vs. Washington Township Board
of Zoning Appeals, Montgomery App. No. 15858, 1996 WL 535304, the Second District Court
of Appeals stated:
If the purpose of a supersedeas bond is to compensate an Appelleewhose right to execute on a judgmenf is stayed thereby, then,logically, there is no need for a supersedeas bond when theunderlying judgment confers no right on which the Appellee canexecute.
Id. at *5.
Clearly, a supersedeas bond is intended to apply to the judgment that is actually the
subject of the appeal. In this case, Dr. Shipman is not presently seeking to set aside the jury's
verdict with her Interlocutory Appeal from the Trial Court's prejudgment interest discovery
orders. Consequently, a supersedeas bond is not necessary in order to secure Appellees' jury
verdict. Once again, a supersedeas bond may be necessary if the jury's verdict was at stake
9
during the appellate process, but it is not at this time.
With respect to Appellees' claim made below that they can now execute on the jury's
verdict, such a position is inconsistent with this Court's decision in Miller, supra. Clearly,
parties possess rights in legal proceedings, including the right to appeal a judgment to a higher
court. At this time, while Appellees' prejudgment interest claim remains pending, Dr. Shipman
does not yet have the right to appeal to the Court of Appeals from the jury verdict. Query: if Dr.
Shipman cannot presently exercise her right to appeal from the jury's verdict, why would
Appellees have the right to execute on the same jury verdict? Further query: if Plaintiffs could
presently execute on the jury verdict, would Plaintiffs have to return the money if Dr. Shipman
ultimately prevails upon appealfrom the jury verdict?
Although the Miller decision does not directly address the particular issues at hand in this
case, its holding is undoubtedly controlling herein, i.e. the jury verdict is not a final appealable
order and, thus, neither Dr. Shipman nor Appellees can exercise their respective rights with
respect to the jury's verdict while prejudgment interest remains unresolved. Accordingly,
Appellees should be prohibited from attempting to exeeute on the jury's verdict while Dr.
Shipman's Interlocutory Appeal remains pending. Also, all proceedings before the Trial Court
should have been stayed without Dr. Shipman being required to post a supersedeas bond,
because Appellee's jury verdict will remain undisturbed pending Dr. Shipman's Interlocutory
Appeal.
The Eleventh District's failure to follow this Court's decision in Miller is of public and
great general concern. Therefore, this Court should accept jurisdiction in order to address this
obvious error that will undoubtedly cause conflicts throughout Ohio.
10
PROPOSITION OF LAW NO. 2: The Error In The Eleventh District's
Legally Flawed Judgment Entry Is Compounded By The ErroneousOrdering Of A Supersedeas Bond In An Amount That Is Unrealistic,Unattainable And Would Cause Irreparable Iiarm
Not only did the Eleventh District erroneously order the posting of a supersedeas bond,
the Eleventh District's ordering of a supersedeas bond in the amount of $10.5 million was so
unreasonably high that it has effectively forced Dr_ Shipman to essentially forfeit her right of
appeal by exposing her to peril of irreparable harm from the continued threat of execution on the
jury's verdict. Dr. Shipman cannot realistically post such an exorbitant supersedeas bond and,
consequently,. the Eleventh District's Judgment Entry will prevent Dr. Shipman from pursuing
her right of appeal by making Dr. Shipman's personal assets subject to execution? Appellees
and the Eleventh District have consistently ignored the peril that Dr. Shipman now faces as a
result of a $10.5 million supersedeas bond order. A proper balance of the peril of irreparable
harm and public policy weighs against the Eleventh Distriet's unrealistic and unattainable $10.5
million supersedeas bond.
The goveruing principle behind a supersedeas bond is to "preserve the status quo while
protecting the non-appealing party's rights pending appeal." When setting a supersedeas bond,
the Court should "seek to protect judgment creditors as fully as possibly without irreparably
injuring debtors." Texaco vs. Pennzoil, 784 F. 2d 1113, 1154 (2nd Circuit, 1984) rev'd on other
grounds 481 U.S. 1 (1987).
By ordering an unattainable supersedeas bond in this case, the Eleventh District has
effectively denied Dr. Shipman of her constitutional right of appeal. An inflexible requirement
for impressment of a lien and denial of a stay of execution unless a supersedeas bond in the full
Z At the time of the filing of the instant appeal, there is presently scheduled for September 27,2011 a Judgment Debtor's Examination of Dr. Shipman before the Trial Court.
11
amount of the judgment is posted can in some circumstances be irrational, unnecessary, and self-
defeating, amounting to a confiscation of the judgment debtor's property without due process. Id.
In Dennerline vs. Atterholt, Indiana Court of Appeals, Case No. 49AD4-0610-CV-557,
the Court addressed a scenario virtually identical to this case. In Dennerline, a jury retumed a
verdict in the amount of $17,991,043.00 and an appeal was taken from the jury verdict 3 The
'IYial Court set an appeal bond in the amount of $20,869,609.88. Upon appeal, the Defendant
requested the appellate court to reconsider the Trial Court's $20,869,609.88 and order a
supersedeas bond reflective of a more realistic collectible amount. In reducing the
$20,886,609.88 appeal bond to $3.0 million, the Court of Appeals based its Order on factors such
as the defendant would suffer irreparable injury and the defendant's hardship was likely greater
than the plaintiff.
The Eleventh District in this case failed to observe the above principles and satisfy this
purpose when it ordered Dr. Shipman to post a$10.5 million supersedeas bond. The Eleventh
District should have ordered a supersedeas bond reflective of what Appellees could ever
realistically recover on the jury verdict. As it stands now, the Eleventh District has ordered a
supersedeas bond far in excess of the actual funds that will even be available to satisfy a
judgment, i.e. Dr. Shipman's $2.0 million in liabiHty coverage. In other words, the Eleventh
District has effectively created funds that may someday be recoverable but simply do not exist.
Although Dr. Shipman adamantly maintained in the first place that a stay in this case
should not have required the posting of a supersedeas bond, in the event that the Eleventh
District was inclined to order the posting of a supersedeas bond, the Eleventh District should
3 Of importance, the defendants in the Dennerline appeal acknowledged the need to the postingof a supersedeas bond in an appeal from the jury's verdict. This appeal does not involve anappeal from the jury's verdict.
12
have required a supersedeas bond that was representative of what Appellees could realistically
collect on the verdict, i.e. the liability policy limits of $2.0 million for Dr. Shipman, plus interest
and costs.
This Court should accept jurisdiction over the case in order to correct the Eleventh
District's misinterpretation and misapplication of the law goveming supersedeas bonds.
IV. CONCLUSION
Based upon the foregoing, this case should be accepted as an appeal involving matters of
public and great general interest. This Court should resolve the conflict and uncertainty that the
Eleventh District has created with respect to the requirements of posting a supersedeas bond
pending an Interlocutory Appeal. It is extremely important to Courts and all litigants throughout
the State of Ohio that this Court take the opportunity to clarify the law goveming supersedeas
bonds,fmal appealable orders and Interlocutory Appeals.
Accordingly, Dr. Shipman requests that this Court accept jurisdiction and allow this
appeal to proceed so that the important issues presented can be reviewed on the merits and
reconciled with the existing law in Ohio.
Respectfully submitted,
^t 3 5J , 0, 1::^,Doug asl G. Leak (0045554) n C)Roetzel & Andress, LPASuite 900, One Cleveland Center1375 East Ninth StreetCleveland, OH 44114216-623-0150216-623-0134 faxdleak a aw.cont
Attorney for Defendants-Appellants TaraShipman, M.D. and Associates in FemaleHealth, Inc.
13
CERTIFICATE OF SERVICE
s to certify that a copy of the foregoing was mailed by regular U.S. Mail thisP-4day ofZrIL,_, 2011 to the following:
Martin White, Esq.154 Park Avenue, NEWarren, OH 44482
Michael Djordjevic, Esq.Djordjevic, Casey & MarmarosSuite 201 at Maiden Lane17 South Main StreetAkron, OH 44308
Norman A. Moses, Esq.100 Marwood CircleBoardman, OH 44512Attorneys for Plaintiffs Appellees
512710 v_01 A061774.1114
Am^L ^ W, ^ /1qu k
Douglas . Leak
14
STATE OF OHIO ) IN THE COURT OF APPEALS)S5.
COUNTY OF TRUMBULL ) ELEVENTH DISTRICT
DEBRA R. COBB, INDIVIDUALLY AND JUDGMENT ENTRYAS PARENT AND LEGAL GUARDIANOF H.N.C., A MINOR, et al.,
. Plaintiffs-Appellees, CASE NO. 2011-T-0049
TARA A. SHIPMAN, M.D., et al.,
Defendants-Appellants.
FILEDCOURT©FAPPEALS
JUL 21 2Uli
TRUBGBULL COUNTY, OHKAREN INFAHTEALLEN, CLERK
This mattpr came on for consideration of appellants', Tara A. Shipman,
M.D. and Associates in Female Health, Inc. (collectively, "Dr. Shipman"), motion
pursuant to App.R. 7 for a stay of proceedings without the posting of a
supersedeas bond. Appellees, Debra R. Cobb and Okey F. Cobb, Jr., and their
minor daughter, H.N.C. "(collectively; "the Cobbs") filed a memorandum in
opposition. Dr. Shipman filed a motion for leave to file a reply brief and a Reply
Brief, which motion is hereby granted instanter.
In the underlying proceeding and after extensive briefing, the trial court
issued a detailed judgment entry granting Dr. Shipman's motion for a stay of
execukion pending appeal of post-verdict judgments relating to discovery. The
stay order was conditioned upon Dr. Shipman posting a supersedeas bond or
other similar security in the amount of $14,553,000 in favor of the Cobbs.
Appx. 1
' We find that the trial court did not abuse its discretion in requiring a bond;
however, we find that the amount of the bond is too high given the total amount
of the final judgment outstanding at this time plus interest.
Procedural History
The underlying appeal emanates from a medical negligence acfion relating
to the birth of H.N.C. The Cobbs alleged that as the direct and proximate result
of the negligence of Dr. Shipman, among others, H.N.C. was bom with cerebral
palsy caused by a lack of oxygen to her brain which occurred during birth. The
Cobbs filed a complaint against five defendants including appellants, Tara A.
Shipman, M.D., (the physician who delivered H.N.C.), and Associates in Female
Health, Inc., (Dr. Shipman's employer).
Following a 15-day trial, the trial court entered a judgment on the verdict in
the amount of $12,102,000 in favor of H.N.C., together with a judgment on the
verdict in the sum of $1,800,000 in favor of her parents. Both verdicts were
entered against Dr. Shipman and, following motions for set-off, the verdicts were
ultimately reduced to a combined total of $9,702,000. Dr. Shipman was insured;
however, the collective liability limits of the policies are $2,000,000.
The Cobbs filed a motion for prejudgment interest and submitted requests
for production of documents seeking discoverable materials from both Dr.
Shipman's insurance carrier and defense counsel. The Cobbs also served a
notice of deposition duces tecum seeking Dr. Shipman's deposition and the
production of documents in her possession including correspondence between
2
Appx.
herself and her insurer and legal counsel and any handwritten notes relating to
the litigation. Depositions of defense counsel were also requested. Motion
practice ensued with motions for protective order and to compel being submitted
to the trial court. The judgment entries ruling on these discovery-related motions
are the subject of the underiying appeal.
Dr. Shipman also filed a motion for judgment notwithstanding the verdict
andlor new trial, which was denied by the trial court. With the motion for
prejudgment interest pending, Dr. Shipman filed a notice of appeal on the
discovery of privileged matters related to appellees' motion for prejudgment
interest. Dr: Shipman also moved the trial court for a stay of execution of
judgment pending appeal. The Gobbs did not oppose a stay of the proceedings
but argued that any stay should be accompanied by a supersedeas bond in
excess of $20,000,000. Pursuant to its June 15, 2011 judgment entry, the trial
court granted Dr. Shipman's motion for stay conditioned upon the posting of a
supersedeas bond in the amount of $14,553,000.
Dr, Shipman's Assertions Reaardinn the Need for and Amount of the Bond
In her motion to stay all trial court proceedings pending appeal without the
posting of a supersedeas bond, she argues that the appeal is an interlocutory
appeal from prejudgment interest discovery orders. Dr. Shipman further asserts
that the jury's verdict is not a final, appealable order and/or a judgment that
needs to be secured with a supersedeas bond pending the instant interlocutory
appeal. Dr. Shipman maintains that the jury's verdict is not a"flnal order° since
3
Appx. 3
prejudgment interest proceedings remain unresolved, and therefore, the
supersedeas bond provision of R.C. 2505.09 is not applicable.
In addition, Dr. Shipman argues that the bond amount is "unrealistic,"
"coercive," "impracticable," "unattainable," and "will likely force Dr. Shipman to
forfeit her right to appeal by exposing her to the peril of irreparable harm from the
continued threat of execution on the jury verdict." In essence, Dr. Shipman
maintains that the trial court has ordered a supersedeas bond far in excess of the
actual funds available to satisfy a judgment, i.e., the $2,000,000 amount of
liability coverage. Thus, at most, she contends that the supersedeas bond
should be set at $2,000,000, plus interest and costs.
The Cobbs' Response
The Cobbs contend that the trial court's condition for stay of execution order
should not be disturbed, stressing that there is no evidence that Dr. Shipman, a
pracficing obstetrician, is "destitute" or "uncollectable," or that "she or her insurer'
were unable to post an adequate supersedeas bond. The Cobbs further argue
that because an appeal has been taken in this case, an adequate supersedeas
bond is required under Civ.R. 62(B); that an "adequate" minimum bond cannot be
less than the amount of the judgment, plus interest; and that it is within the trial
court's discretion to set a bond in excess of the minimum amount. The Cobbs
also argue that although the jury verdict is not a final, appealable order at this
time, it is still a final judgment, even though a motion for prejudgment interest has
been filed and remains pending.
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Appx. 4
The Need for a Bond-R.C. 2505.09, Civ.R. 62(B), Final Orders and Final.Apoealabte Orders
The purpose of a supersedeas bond is to secure the appellee's right to
collect on the judgment during the pendency of an appeal. Mahoney v. Berea
(1986), 33 Ohio App.3d 94, 96. The governing principle behind a supersedeas
bond is to preserve the status quo while protecting the non-appealing party's
rights pending appeal. Buckles v. Buckles (1988), 46 Ohio App.3d 118,123.
Under R.C. 2505.09, a stay of execution of a judgment may be obtained by
complying with the Appellate Rules of Procedure and executing a supersedeas
bond in an amount not less than the amount of the "final order, judgment, or
decn:e" and interest. App.R. 7(13) provides that the granting of a stay may be
conditioned upon the filing of a bond or other security. "Detennining the need for
the bond and its amount are discretionary matters which will not be overtumed by
the appellate court absent a showing of an abuse of discretion:" Bibb v. Home
Savings and Loan Co. (1989), 63Ohio App.3d 751, 752. An abuse of discretiDn
is the trial court's ""failure to exercise sound, reasonable, and legal decision-
making.'" State v. Beechier, 2d Dist. No. 09-CA-54, 2010-Ohio-1900, at ¶62,
quoting Black's Law Dictionary (8 Ed.Rev.2004) 11.
Civ.R. 62(B), "Stay upon appeal," provides: "[w]hen an appeal is taken the
appellant may obtain a stay of execution of a judgment or any proceedings to
enforce a judgment by giving an adequate supersedeas bond. The bond may be
given at or after the time of filing the notice of appeal. The stay is effective when
the supersedeas bond is approved by the court °
5
Appx. 5'
Dr. Shipman argues there is no need for a bond at this time inasmuch as
the appeal concems only interlocutory discovery orders regarding the pending
motion for prejudgment interest. It is her position that the jury verdict is not at risk
of reversal as it is not yet a final, appealable order nor is it a final order that
needs to be secured, relying on Miller v. First lntemati. Fid. & Trust Bldg., 113
Ohio St,3d 474, 2007-Ohio-2457, for the proposition that "[a] joumalized jury
verdict is not a final, appealable order when a motion for prejudgment interest
has been filed and remains pending." Id. at syllabus.
In Miller, the appellant appealed from a judgment overruling its motion for
judgment notwithstanding the verdict or for new trial before the motion for
prejudgment interest had been resolved. Id. at ¶1. The Supreme Court of Ohio
afflnned the Sixth Districfs dismissal of the appeal for lack of a final, appealable
order. Id. at¶1, 11.
Unlike Miller, Dr. Shipman filed an appeal based on prejudgment interest
discovery orders. Thus, the pending motion for prejudgment interest does not
affect the finality and enforceability of the judgment on the verdict regardless of
its character as a final and appealable order. Although the jury verdict here is not
yet a final, appealable order, it is still a final judgment, pursuant to R.C. 2505.09
and Civ.R. 62(B), even though a motion for prejudgment interest has been filed
and remains pending. See, also, Stewart v. Zone Cab of Cleveland (Jan. 31,
2002), 8th Dist No. 79317, 2002 Ohio App. LEXIS 378, at *6 (holding that "the
appellate rules operate to toll the appeal time for a party that opts to pursue
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Appx. 6
certain post-judgment motions but this provision for additional time does not
change the finality of the judgment itself and observing that 'the existence of a
pending post-judgment motion does not preclude a successful litigant from
commencing efforts to enforce the judgment °)
In addition, Dr. Shipman relies on a case from the Maryland Court of
Appeals, O'Donnell v. McGann (1987), 529 A.2d 372, for the proposition that this
court should set a supersedeas bond in an amount equal to the policy limits of
insurance available in this case. We note that the court in O'Donnell held that
Maryland circuit courts could only exercise discnaon to lower a bond amount
when the moving party presented a plan that would preserve the status quo
during the pendency of the appeal, while also demonstrating why the existing
rules should be altered. Id. at 377.
Applying O'Donnell to the case at bar, we note that Dr. Shipman failed to
present a plan that would preserve the status quo during the pendency of the
appeal either to the trial court or to this court. Other than the existence and
amount of liability insurance coverage available to secure the Cobbs' ability to
collect after appeal, we have no other evidence of available security. In addition,
Dr. Shipman failed to demonstrate why the existing rules should be altered.
Thus, the trial court properly determined that although not controlling in Ohio,
appellants' motion would not survive even under the O'Donnell standani:
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Appx. 7
The Amount of the Bond
Atthough the trial court granted the motion for stay of execution of judgment
pending appeal, Dr. Shipman takes issue with the amount of the supersedeas
bond. The minimum amount of the outstanding judgment is approaching
$10,000,000, as interest is currently running at four percent per year post-
judgment. Dr. Shipman is effectively asking this court to modify and reduce the
amount required to effectuate the trial court's stay. Again, this court will not
modify a trial court's ruling on a motion for stay, or an amount of bond set by the
trial court, absent a showing of an abuse of discretion. Bibb, supra, at 752.
As recounted ear(ier, Dr. Shipman asserts that "[t]he Trial Court's setting of
such an unreasonably high supersedeas bond will likely force Dr. Shipman to
forfeit her right of appeal by exposing her to the peril of irreparable harm from the
continued threat of execution on the jury verdict." This court cannot rest a
decision soiely upon speculation; Dr. Shipman's submissions provide no
evidence of attempts to obtain a bond or that it is impossible to obtain a bond in
the amount set by the trial court or in any amount for that matter. We only have
before us an assertion in a footnote that "[t]here has been no dispute that Dr.
Shipman cannot post a supersedeas bond in the amount of $12,533,000.00," and
we note that the Cobbs did not concede this point.
Nor are there any specifics regarding the assets and/or the collectability of
Dr. Shipman. We note that unlike here, the Maryland Court at least had before it
the fact that the judgment debtoes assets amounted to only $14,000. Dr.
a
Appx. 8
Shipman argues in a conclusory fashion that the bond amount should be
°representative of what Appeflees could realistically collect on the verdict, i.e. the
liability policy limits of $2.0 million for Dr. Shipman, plus interest and costs," but
she gives us nothing upon which we can base an evaluation of collectability.
Moreover, there is no argument addressing the core question of adequacy.
We fail to see, and Dr. Shipman has not established irreparable harm. Dr.
Shipman also fails to provide any information in the motion why she believes she
would prevail on appeal.
We do, however, find that the trial court exceeded its discretion in setting
the amount of the bond. The amount set by the trial court is too high given the
total amount of the final judgment outstanding at this time plus interest especially
inasmuch as there has been no decision on the merits of the motion for
prejudgment interest. Ihiis; :we flnd that a bond in the amount of $10,500,000
corDports with the requirements of R.C. 2505.09 and is adequate to maintain the
status quo pending the appeal of the judgment relative to the discovery issues
and to provide security for the tfie amount of the final judgment outstanding at
this time plus interest.
Therefore, appellants' motjon to stay all trial court proceedings pending
appeal without the posting of a supersedeas bond is hereby overruled, and
appellants' motion to stay execution of the judgment pending appeal is granted.
However, this stay order shall not become effective until appellants have posted
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with the Trumbull County Clerk of Courts a supersedeas bond in the amount of
$10,500,000, cash or surety.
Furthermore, this stay order only applies to the present appeal before us.
In the event there are additional appeals, either on any ruling by the trial court
regarding prejudgment interest currently pending before it or on the jury's verdict,
appellants may seek a stay but shall provide such additional bond as determined
by the trial court or this court.
DIANE V. GRENDELL, J.,
SEAN C. GALLAGHER, J., Eighth Districtassignment,
concur.
Y JANE T
Court of Appeals, sitting by
FILEDCOURT OFAPPEALS
'JUL 21 2011
TRUMBULL courm, oHKAREN INFANTEALLEN,CLEtdN
Appx. 10