United States District Court, W.D. Virginia, Harrisonburg Division
Michael F. Urbanski, United States District Judge.
matter is before the court on judgment creditor DIRECTV,
Inc.'s ("DIRECTV') motion for a cost bond under
Rule 7 of the Federal Rules of Appellate Procedure
("Rule 7"). ECF No. 337. Randy and Kimberli Coley
(collectively, "the Coleys") filed briefs in
opposition, ECF Nos. 342, 343, and the matter was referred to
Magistrate Judge Robert Ballou, ECF No. 339. On December 5,
2016, Judge Ballou issued a report recommending that DIRECTVs
motion be granted, and that a $75, 000 appeal bond be
imposed. ECF No. 362. The Coleys timely filed objections, ECF
Nos. 365, 366, to which DIRECTV responded, ECF No. 369. For
the reasons that follow, the court ADOPTS the . report and
recommendation in its entirety (ECF No. 362), GRANTS DIRECTVs
motion (ECF No. 337), and requires the appellants, Randy
Coley, Kimberli Coley, and Its Thundertime, LLC ("Its
Thundertime") to furnish a Rule 7 cost bond in the
amount of $75, 000.
72(b) of the Federal Rules of Civil Procedure permits a party
to "serve and file specific, written objections" to
a magistrate judge's proposed findings and
recommendations within fourteen days of being served with a
copy of the report. See also 28 U.S.C. §
636(b)(1). The Fourth Circuit Court of Appeals has held that
an objecting party must do so "with sufficient
specificity so as reasonably to alert the district court of
the true ground for the objection." United States v.
Midgette, 478 F.3d 616, 622 (4th Cir. 2007), cert,
denied. 127 S.Ct. 3032 (2007).
To conclude otherwise would defeat the purpose of requiring
objections. We would be permitting a party to appeal any
issue that was before the magistrate judge, regardless of the
nature and scope of objections made to the magistrate
judge's report. Either the district court would then have
to review every issue in the magistrate judge's proposed
findings and recommendations or courts of appeals would be
required to review issues that the district court never
considered. In either case, judicial resources would be
wasted and the district court's effectiveness based on
help from magistrate judges would be undermined.
Id. The district court must determine de
novo any portion of the magistrate judge's
report and recommendation to which a proper objection has
been made. "The district court may accept, reject, or
modify the recommended disposition; receive further evidence;
or return the matter to the magistrate judge with
instructions." Fed.R.Civ.P. 72(b)(3); accord 28
U.S.C. § 636(b)(1). "General objections that merely
reiterate arguments presented to the magistrate judge lack
the specificity required under Rule 72, and have the same
effect as a failure to object, or as a waiver of such
objection." Moon v. BWX Techs., Inc., 742
F.Supp.2d 827, 829 (W.D. Va. 2010) (citing Veney v.
Astrue, 539 F.Supp.2d 841, 845 (W.D. Va. 2008)),
aff'd, 498 F.App'x 268 (4th Cir. 2012); see also
Thomas v. Am, 474 U.S. 140, 154 (1985) ("[T]he
statute does not require the judge to review an issue de
novo if no objections are filed.").
objections that only repeat arguments raised before the
magistrate judge are considered general objections to the
entirety of the report and recommendation. See Veney
v. Astrue. 539 F.Supp.2d 841, 845 (W.D. Va. 2008).
As the court noted in Veney:
Allowing a litigant to obtain de novo review of her
entire case by merely reformatting an earlier brief as an
objection "mak[es] the initial reference to the
magistrate useless. The functions of the district court are
effectively duplicated as both the magistrate and the
district court perform identical tasks. This duplication of
time and effort wastes judicial resources rather than saving
them, and runs contrary to the purposes of the Magistrates
Act. Howard [v. Sec'y of Health & Human
Servs.], 932 F.2d , 509 [(6th Cir. 1991)].
539 F.Supp.2d at 846 (first brackets in original). A
plaintiff who reiterates his previously raised arguments will
not be given "the second bite at the apple he
seeks." Id. Instead, his re-filed brief will be
treated as a general objection, which has the same effect as
a failure to object. Id.
their objections, the Coleys raise four main issues-one
factual, three legal. First, they object to the magistrate
judge's finding that "the Coley [p]arties have
engaged in vexatious or bad faith conduct, " ECF No.
362, at 5, particularly as this finding relates to Kimberli
Coley. Second, the Coleys argue that Rule 7 does not permit
the court to include the expected costs of attorneys'
fees in an appeal bond. Third, they argue that, even if
attorneys' fees may be included in an appeal bond in some
circumstances, they may not here, where the appeal concerns a
matter of Delaware state law unrelated to the judgment under
the Federal Communications Act, 47 U.S.C. § 605(a)
("FCA"). Finally, the Coleys suggest that, if the
court does adopt the magistrate judge's report, a lis
pendens on Its Thundertime's property, rather
than a cash bond, should be imposed. The court will address
each argument in turn.
Kimberli Coley's Conduct
Coley argues that "the Report and Recommendation is
clearly erroneous and contrary to law because it is based on
the mistaken fact-finding that the Coley Parties have engaged
in Vexatious and bad faith conduct' in the post-judgment
proceedings, " which cannot be correct, given that
"the term 'Coley Parties, ' as defined in the
Report and Recommendation, includes Kimberli Coley, Its
Thundertime, and South Raleigh Air-none of whom were parties
to the post-judgment proceedings." ECF No. 365, at 5
Coley has misstated the findings of the magistrate judge. The
report did not consider only conduct during
"post-judgment proceedings"; rather, it found that
"there is no question that the Coley Parties have
engaged in vexatious or bad faith conduct, and have been
sanctioned repeatedly for such conduct." ECF No. 362, at
5. Reviewing the Coleys' behavior over the lengthy course
of this litigation confirms the accuracy of the report's
instance, the court's memorandum opinion of July 18,
2016, ECF No. 298, chronicles several instances of bad faith
conduct involving Kimberli Coley. Kimberli Coley refused to
comply with the terms of a settlement agreement she and Randy
Coley entered into in bankruptcy court-conduct which the
court, agreeing with the plaintiffs, found to amount to
"playing fast and loose with the federal
judiciary." Id. at 3-4. Even more outrageous,
Kimberli and Randy Coley have made inconsistent statements to
this court, under oath, in order to serve their own interests
at the time. "Throughout the underlying litigation,
Randy and Kimberli Coley adamantly maintained that Kimberli
Coley had no involvement whatsoever in her husband's
cable business or in his business ventures generally."
Id. at 9. Relying on these assertions, DIRECTV
voluntarily dismissed its claims against her. Id. at
11. Once DIRECTV sought to enforce its judgment against the
substantial assets associated with the LLCs, the Coleys
changed their tune, averring in expansive terms of Kimberli
Coley's involvement in, and part ownership of, these
entities. Id. Further, as set forth at some length
in the July 18, 2016 memorandum opinion, this sleight of hand
included the production in discovery of contradictory Its
Thundertime operating agreements, one produced pre-judgment
listing Randy Coley as sole manager/member, and another
produced post-judgment including Kimberli Coley as a member.
Id. at 12-17. In addition, the memorandum opinion
addresses the rampant commingling of assets between Randy and
Kimberli Coley and the sham LLCs. Id. at 17-22.
Accordingly, the court equitably estopped the Coleys from
asserting that Kimberli Coley has any membership interest in
the LLCs, finding that the Coleys "plainly misled the
parties (and the court) about the nature of Kimberli's
interest" in her husband's companies. Id.
at 31-33. Nonetheless, in her brief in opposition to
DIRECTV's bond motion, Kimberli Coley continues to assert
that she "owns a 50% membership interest in [Its]
Thundertime." ECF No. 343, at 2.
short, the record is replete with examples of Randy and
Kimberli Coley's attempts to obfuscate, mislead, and
generally subvert the cause of justice. The court ADOPTS
the factual findings of the magistrate judge.
Attorneys' Fees in ...