Local Rule 39 states in pertinent part:
The court, on motion or in [sic] its own initiatiative, may order any party to file an original bond for costs or additional security for costs in such an amount and so conditioned as it may designate.
The application of this Rule is not unprecedented.
Therefore plaintiffs' motion as to costs is granted.
While Rule 39 only specifies security for costs, security for attorneys' fees may be included in that award where the party seeking the security is otherwise entitled to attorneys' fees -- e.g. by statute or contract.
Refco, in this case, is entitled to security for attorneys' fees because its contract with Galadari specifically states that Refco is entitled to attorneys' fees in the event of litigation concerning any collection action. Plaintiffs' Memorandum of Law in support of Plaintiffs' Joint Motion for security at 13.
Security covering potential judgment or sanctions is beyond the language and scope of Rule 39. Therefore plaintiffs' motion for security as to those awards is denied.
Drexel should submit affidavits outlining and detailing accrued and prospective costs. Refco should submit affidavits outlining and detailing same, including attorneys' fees.
For the foregoing reasons, the motions of the Emirate of Dubai and the Committee of Receivers to dismiss plaintiffs' amended and supplemental complaint is denied. Drexel's motion for security covering costs not including attorneys' fees is granted. Refco's motion for security covering costs, including attorneys' fees is granted. Plaintiffs' motion for security covering potential judgment and sanctions is denied.
Submit Order on 15 days notice regarding costs.
Dated: January 14, 1993
New York, New York
CONSTANCE BAKER MOTLEY
UNITED STATES DISTRICT JUDGE