Fidelity’s Chase of Fraud Judgment OK’d by 9th

(CN) - A registered judgment, entered in one federal court and registered in another, may be registered in a third federal court, the Ninth Circuit ruled Monday.

The case stems from a 2002 multimillion-dollar fraud judgment obtained by Fidelity National Financial and Fidelity Express Network against four individuals and trustees in Los Angeles Federal Court. Defendants have only paid about 0.3 percent of the judgment, and owe more than $10 million.

While the case was pending, the Fidelity companies registered the judgment in Arizona. The judgment expired in 2007 though, and the companies were unable to renew it there.

Instead, Fidelity registered the judgment in Seattle's federal court in 2011, and then registered the Washington judgment in Arizona. The Arizona court vacated the second registration, finding that only an original judgment - like the California one - may be registered.

Writing for a three-judge panel, U.S. District Judge Paul L. Friedman - sitting with the Ninth Circuit by designation from the D.C. Federal Court - disagreed with the lower court, finding that the federal registration statute, 28 U.S.C. Section 1963, allows for a judgment entered in one federal court to be registered in another.

"A registered judgment is 'a judgment in an action for the recovery of money or property entered in any . . . district court,' and itself may be registered," Friedman wrote for the panel.

Defendants had claimed it is "absurd" to allow a plaintiff to jump from jurisdiction to jurisdiction to recoup a monetary judgment.

"Successive registration, however, is hardly unreasonable," Friedman found.

Attorneys for the parties did not immediately respond to a request for comment.

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