McGraw-Hill Global Education, LLC v. Jones
714 F. App'x 500
| 6th Cir. | 2017Background
- Publishers sued Griffin and Jones for a scheme importing and altering foreign-edition textbooks to sell in the U.S., alleging copyright and trademark violations; litigation began in 2012.
- In June 2016 Griffin served a Rule 68 Offer of Judgment: a lump-sum judgment of $359,254 "plus costs accrued through the date of this offer as may be allowed by the Court based on the submission of a bill of costs pursuant to Fed. R. Civ. Proc 54(d)(1)."
- Publishers accepted the Offer and submitted a proposed judgment that directed damages of $359,254 plus costs to be determined by the court; the district court entered judgment nunc pro tunc to the acceptance date.
- Publishers then moved for costs including attorneys’ fees; Griffin objected, arguing the Offer excluded attorneys’ fees by cross-referencing Rule 54(d)(1).
- The district court sua sponte vacated the judgment, concluding the Offer impermissibly attempted to exclude attorneys’ fees and was therefore invalid; Publishers appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a Rule 68 offer that refers to "costs pursuant to Rule 54(d)(1)" precludes attorneys' fees under the Copyright Act | The Copyright Act authorizes attorneys' fees as part of "costs," so the statutory grant allows fees despite the Rule 54(d)(1) reference | The Offer unambiguously excluded attorneys' fees by directing costs under Rule 54(d)(1), which (after the 1993 amendment) separates attorney-fee procedure into 54(d)(2) | Ambiguity construed against drafter; Offer does not bar fees. Publishers may seek attorneys' fees as part of costs under §505. |
| Whether the district court properly voided the Offer and vacated the judgment sua sponte | Publishers asked the court to enforce the judgment and award costs; they did not seek nullification | Griffin defended the district court’s interpretation that the Offer was invalid | Court held the district court erred: it lacked authority to grant Rule 60(b)-style relief sua sponte and should not have vacated the judgment. |
| Proper remedy when a Rule 68 offer is silent or ambiguous about attorneys' fees | Plaintiffs can petition the court for an award of costs including attorneys' fees when the offer is silent/ambiguous | Defendant argued silence or cross-reference meant exclusion of fees | If offer is silent/ambiguous, plaintiff may move for fees and the court will determine an appropriate award; ambiguous offers are construed against the drafter. |
| How to interpret Rule 68 offers vis-à-vis attorney-fee inclusion | Offer accepted; court should determine costs per statute and Rule 54 procedure | Defendant could have plainly stated fees were excluded or included; ambiguity favors plaintiff | Court applied precedent: an offer that fails to incorporate fees in the stated sum will be read to allow fees where statute prescribes. |
Key Cases Cited
- Marek v. Chesny, 473 U.S. 1 (1985) (Rule 68 requires court to add an amount for costs if offer does not state costs are included)
- Fulps v. City of Springfield, 715 F.2d 1088 (6th Cir. 1983) (offer silent on fees permits plaintiff to seek fees as costs)
- Lima v. Newark Police Dep’t, 658 F.3d 324 (3d Cir. 2011) (ambiguities in Rule 68 offers are construed against the drafter)
- Util. Automation 2000, Inc. v. Choctawhatchee Elec. Coop., Inc., 298 F.3d 1238 (11th Cir. 2002) (Rule 68 offers are firm, non‑negotiable binary choices)
- Sanchez v. Prudential Pizza, Inc., 709 F.3d 689 (7th Cir. 2013) (ambiguous offers on fees will be construed against the offering defendant)
- United States v. Pauley, 321 F.3d 578 (6th Cir. 2003) (court must treat sua sponte voiding as Rule 60(b)(4) action)
- Eaton v. Jamrog, 984 F.2d 760 (6th Cir. 1993) (district courts may not grant Rule 60(b) relief sua sponte)
- Lewis v. Alexander, 987 F.2d 392 (6th Cir. 1993) (same principle regarding Rule 60(b) motions)
Decision: The Sixth Circuit reversed the district court, reinstated the judgment, and remanded for the district court to determine costs payable to Publishers, including attorneys’ fees.