United States District Court, W.D. Texas, Austin Division
W. AUSTIN, UNITED STATES MAGISTRATE JUDGE.
the Court is Plaintiff's Motion for Good Cause to Certify
Judgment Notwithstanding Appeal and Brief in Support (Dkt.
No. 107); and Pathway's Response (Dkt. No. 108). This
case is pending before the undersigned for all purposes based
on the consent of all parties.
brief, the undersigned entered a money judgment in favor of
MidCap Media Finance LLP against Pathway Data, Inc. after a
bench trial of this case. Dkt. No. 95. The Court later
awarded MidCap attorney's fees as well. Dkt. No. 105.
Pathway filed a notice of appeal from the judgment (Dkt Nos.
100, 101), and MidCap filed notice of a cross appeal. Dkt.
No. 103. The case remains pending before the Fifth Circuit,
which on April 23, 2019, notified the parties that it would
decide the case on the briefs, without oral argument. Pathway
has not attempted to supercede the judgment pending the
appeal, nor has it made any payments toward the judgment.
present motion MidCap makes a request pursuant to 28 U.S.C.
§ 1963 for the Court to certify the judgment in this
case so that it may register the judgment in Nevada and
California, where it believes Pathway has assets that might
satisfy the judgment. Pursuant to the relevant statute, no
leave of court is required to register a judgment that
“has become final by appeal or expiration of the time
for appeal.” 28 U.S.C. § 1963. When this is not
the case, a party may register a judgment only if
“ordered by the court that entered the judgment for
good cause shown.” Id. Arguing that good cause
exists here, MidCap asks that it be permitted to register the
judgment from this case in California and Nevada, as well as
“any other applicable jurisdiction.” Dkt. No, 107
at 3. MidCap contends there is good cause based on the
Court's findings that the owner and CEO of Pathway
provided testimony at trial that was lacking in credibility,
and because Pathway has no assets in Texas, and appears to
have assets in both California and Nevada. Pathway objects to
the characterization of Coulter's testimony, and contends
that as far as Nevada is concerned, MidCap has failed to
demonstrate that there is good cause to certify the judgment.
purpose of allowing the registration of a judgment in a
jurisdiction other than the one in which the judgment was
rendered is to allow a judgment creditor to secure payment of
the judgment from out-of-state assets when the debtor does
not have sufficient assets in the trial jurisdiction, and to
protect against a debtor that has not posted a supersedeas
bond using the time during which the appeal is pending to
dispose of assets that might be able to satisfy the judgment.
See. e.g., Fisher Scientific Internat'l Inc. v.
Modrovish, 2006 WL 1126729 at *1 (S.D. Tex. Jan. 17,
2006). Regardless of whether Coulter is viewed as
trustworthy, MidCap's evidence is sufficient to
demonstrate good cause. It takes very little to make this
showing. In Fisher the judgment creditor relied on
statements of the debtor's counsel at a hearing to show
that the debtor did not have property in Texas, and the
results of asset searches to demonstrate a likelihood that he
had assets in California. Id. In another case, the
only evidence of the presence of assets in the foreign
jurisdiction was that fact that the debtor had its principal
place of business there. Cianbro Corp. v. George H. Dean,
Inc., 749 F.Supp.2d 1, 3 (D. Maine 2010).
MidCap's evidence consists of the existence of a number
of UCC financing statements and liens for unpaid taxes filed
against Pathway in both Nevada and California. One of the
documents in Nevada was filed by the DB7C-2002 Trust as the
secured party and Consumer Direct (Pathway's d/b/a name)
as the debtor. Dkt. No. 107-2 at 47. The UCC-1 was filed July
16, 2018, only one week after the Court entered its judgment
in this case. As noted in the Memorandum Opinion here,
Coulter is the sole trustee and a beneficiary of the
DB76-2002 Trust. Dkt. No. 93 at 8. It is fair to assume that
the Trust-which is completely controlled by Coulter-would not
have filed a UCC-1 securing payment of a debt owed to the
Trust by Pathway-another entity Coulter completely
controls-unless Pathway owned assets in Nevada. That is
certainly sufficient evidence to support a showing of good
cause. Further, Pathway does not contest MidCap's claims
that Pathway does not own property in Texas, but likely does
have assets in California. MidCap has demonstrated good cause
under § 1963.
Plaintiffs Motion for Good Cause to Certify Judgment
Notwithstanding Appeal and Brief in Support (Dkt. No. 107) is
GRANTED. It is ORDERED that
the Clerk of Court certify the Final Judgment entered by the
Court on July 9, 2018. It is further ORDERED
that MidCap may register the certified Judgment in the United
States District Court of the Central District of California,
and the United States District Court for the District of
As noted earlier, MidCap also requested
that it be permitted to register the judgment in “any
other applicable jurisdiction.” Because it has not
offered any evidence of good cause for any jurisdiction other
than those addressed in this order, the Court cannot certify
the judgment so broadly. Should MidCap gather evidence of
Pathway assets in other jurisdictions, ...