ExxonMobil recently attempted to settle a class action involving
the payment of gas royalties. As part of that settlement, it agreed
to a provision that would impose a severe appeal bond on any
objectors who might wish to appeal an unsuccessful objection. The
clause read:
Because any appeal by an objecting
Class Member would delay the payment under the Settlement,
each Class Member that appeals agrees to put up a cash bond
to be set by the district court sufficient to reimburse Class
Counsel's appellate fees, Class Counsel's expenses, and the
lost interest to the Class caused by the delay.
(Emphasis added.) This provision imposed greater costs on
appealing objector than the requirements of Federal Rule of Appellate Procedure 7, which
usually govern the posting of appeal bonds. ExxonMobil lost nothing
by agreeing to this provision, but its real benefit was for
plaintiffs' counsel, who often cannot be paid while the case is
still ongoing. (Thus the reasoning behind
