CIVIL PROCEDURE: Recovery of Costs in Federal Court by Prevailing Party

Tuesday, February 26, 2013
The author of this is article is Paul Ferrer, a legal research attorney with National Legal Research Group in Charlottesville, Virginia.

Parties who secure a favorable judgment in federal court may be happy with the outcome but should not forgo seeking their recoverable costs as well.  The Federal Rules of Civil Procedure specifically provide that "[u]nless a federal statute, these rules, or a court order provides otherwise, costs—other than attorney's fees—should be allowed to the prevailing party."  Fed. R. Civ. P. 54(d)(1).  The threshold question for any court prior to awarding costs under Rule 54(d) involves a determination of who the "prevailing party" is in the lawsuit.  In general, a party prevails for purposes of Rule 54(d) when a final judgment awards it "substantial relief."  Smart v. Local 702 Int'l Bhd. of Elec. Workers, 573 F.3d 523, 525 (7th Cir. 2009).  A party that gets substantial relief prevails "even if it doesn't win on every claim."  Slane v. Mariah Boats, Inc., 164 F.3d 1065, 1068 (7th Cir.), cert. denied, 527 U.S. 1005 (1999).

In Sommerfield v. City of Chicago, No. 06 C 3132, 2012 WL 5381255, at *2 (N.D. Ill. Oct. 31, 2012), for example, the plaintiff was determined to be the prevailing party because the jury had returned a verdict in his favor on two counts, awarding him $30,000, even though the jury had found against him on a third count and two other counts had been dismissed at the summary judgment stage.  Sommerfield also exemplifies the concept that "a determination of who is the prevailing party for purposes of awarding costs should not depend on the position of the parties at each stage of the litigation but should be made when the controversy is finally decided."  Repub. Tobacco Co. v. N. Atl. Trading Co., 481 F.3d 442, 446 (7th Cir. 2007) (quoting 10 Charles A. Wright et al., Federal Practice and Procedure § 2667 (3d ed. 2006)); see also Smart, 573 F.3d at 525 (a "final judgment" awarding substantial relief is "one that resolves all claims against all parties").  In Republic Tobacco, the court held that a party that had succeeded on a posttrial motion in having damages awarded against it reduced from $18.6 million to $7.44 million was not a prevailing party that could recover its costs in the district court under Rule 54(d).  481 F.3d at 446-47.

With regard to the nuts and bolts of recovering costs under Rule 54(d), the district court is generally vested with wide discretion to determine "whether and to what extent costs may be awarded to the prevailing party."  Sommerfield, 2012 WL 5381255, at *1.  But a district court may not tax costs under Rule 54(d) unless a federal statute authorizes an award of those costs.  See Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437 (1987); Repub. Tobacco, 481 F.3d at 447.  Title 28 U.S.C. § 1920 specifically provides that costs may be taxed for (1) fees of the clerk and marshal; (2) fees for printed or electronically recorded transcripts; (3) fees and disbursements for printing and witnesses; (4) fees for exemplification and the costs of making copies; (5) docket fees; and (6) compensation of court-appointed experts and interpreters.  Section 1920 requires that for costs to be awarded, "[a] bill of costs shall be filed in the case and, upon allowance, included in the judgment or decree."  28 U.S.C. § 1920.  The district court must review a prevailing party's proposed bill of costs in "scrupulous detail," and the claimed expenses must be "reasonable, both in amount and necessity to the litigation."  Sommerfield, 2012 WL 5381255, at *1 (internal quotation marks omitted).  While the prevailing party has the burden of demonstrating the amount of its recoverable costs, the losing party bears the burden of showing that the claimed costs are not appropriate.  Sommerfield provides a good recent example of the types of costs that may be recovered and the level of detail that should be included in a prevailing party's proposed bill of costs to document the claimed amounts.  See id. at *3-5 (listing claimed costs and refusing to award costs for certain items for which the plaintiff had failed to provide the court with an invoice or other supporting evidence).

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About the Author: The author of this is article is Paul Ferrer, a legal research attorney with National Legal Research Group in Charlottesville, Virginia. This case summary originally appeared on The Lawletter Blog.
Tag Words: Civil procedure, recovery of costs, prevailing party, Federal court, Federal Rules of Civil Procedure, lawsuit, litigation, attorney's fees, awarding costs, recovering costs, claimed costs, claimed amounts, bill of costs, Lawletter, National Legal Research Group, Florida health attorney, Florida health lawyer, attorney, Board Certified attorney, Board Certified lawyer, Florida Bar, Health Law

This article was originally published in The Lawletter Vol 37, No. 10.


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