162 F.R.D. 248 | D. Mass. | 1995
MEMORANDUM AND ORDER
It has been said that disputes in academia are especially bitter because the stakes are so small.
In this ease, the defendant, Allstate Insurance Company (“Allstate”), prevailed on the merits and sought to recover its costs. After an award of substantially less than the full amount sought and a trip to the First Circuit, Allstate returns to claim the fruits of its victory. Allstate is not, however, entitled to all the reimbursement it seeks.
I. Background
Seventy-six former insurance sales agents (the “Agents”) brought suit in 1990 challenging the compensation policies of their employer, Allstate. Three more agents were added to the plaintiffs’ roster in November of 1991. The Agents claimed breaches of their employment contracts and the implied covenant of good faith and fair dealing, as well as violations of the Massachusetts Consumer Protection Act, Mass.Gen.L. ch. 93A. After extensive discovery, Allstate filed two summary judgment motions, prevailed on both, and judgment entered for Allstate on all claims. The Agents’ appeal was dismissed on procedural grounds, but the First Circuit noted that it would have affirmed the decision below on the merits. Gochis v. Allstate Ins. Co., 16 F.3d 12, 16 n. 8 (1st Cir.1994).
Allstate then filed a Bill of Costs in the amount of $25,499.01, the largest elements of which were $19,866.85 in deposition-related expenses and $4,859.86 in photocopying charges.
Pursuant to the First Circuit’s order, Allstate then filed a Supplementary Bill of
II. Discussion
A. The Legal Standard
The assessment (“taxation”) of costs is governed by the tandem operation of a federal statute, 28 U.S.C. section 1920,
The precise contours of the power to decline to tax costs have yet to be determined in this circuit. See San Juan, 994 F.2d at 963 (First Circuit “has been more muted both about a district judge’s duty to explain a denial of costs and about the reasons that may warrant such a denial.”). Where the basis for the denial of costs is “readily apparent,” no explanation is required, but in other cases, the district court is obligated to make “some statement” justifying its denial of costs. Id. Although other appellate courts have detailed broad categories of circumstances justifying the denial of costs, see, e.g., White & White, Inc. v. American Hospital Supply Corp., 786 F.2d 728, 730 (6th Cir.1986) (denial of costs proper where taxable expenditures by prevailing party are “unnecessary or unreasonably large”; where prevailing party unnecessarily prolonged the trial or injected unmeritorious issues; where recovery is so insignificant that the judgment amounts to a victory for the losing party; and where case is “close and difficult”); Burroughs v. Hills, 741 F.2d 1525, 1542 (7th Cir.1984), cert. denied sub nom. Burroughs v. Pierce, 471 U.S. 1099, 105 S.Ct. 2321, 85 L.Ed.2d 840 (1985) (denial of costs proper only where losing party indigent or prevailing party guilty of “some fault, misconduct, default, or other action worthy of penalty”), such is not the case here. Rather, a district court in the First Circuit has long possessed broad discretion to deny costs as long as it “offers a sound reason” for doing so. San Juan, 994 F.2d at 964; Leeds & Northrwp Co. v. Doble Eng’g Co., 41 F.Supp. 951, 951-52 (D.Mass.1941) (Brewster, J.). The Court is, of course, guided further by the views expressed by the Court of Appeals in its remand of this case.
Allstate characterizes the issues now before the Court as 1) whether the discovery was “reasonably appropriate” when taken, and 2) whether its conduct warranted the “penalty” of disallowance. Both are off the mark. The First Circuit explicitly rejected the premise of the first proposition, that the costs of reasonably appropriate discovery are always recoverable, when it held that the costs of depositions “introduced in evidence or used at trial” may be taxed to the losing
Where a court declines to tax all theoretically recoverable costs, the relevant inquiry is the use to which the discovery is put once obtained and whether the costs were necessary to resolution of the case. See Emerson v. National Cylinder Gas Co., 147 F.Supp. 543, 545 (D.Mass.1957), aff'd, 251 F.2d 152 (1st Cir.1958) (test is the “extent to which it was reasonable to go to furnish ‘real assistance’ to the court”). All other costs are “preparatory,” and are not automatically recoverable. See Walters, 692 F.Supp. at 1442-43. While this may appear to result unfairly in the Court’s application of twenty-twenty hindsight to the conduct of the parties, and then “punishing” the prevailing party for discovery which does not prove essential to the result by disallowing its cost, that is the regime under which we operate.
B. Application to the Facts
Although this case involved seventy-nine named plaintiffs and was not certified as a class action, the Agents broke down neatly into two discrete categories. The first group consisted of seventy-seven agents, all of whom were employed by Allstate pursuant to an Agency Compensation Agreement requiring them to work exclusively for Allstate, setting the compensation rates, and including a two-year non-competition period following the termination of employment. These agents claimed generally that they were “owners” of business generated in “assigned risk” situations. See Gotchis (sic) v. Allstate Ins. Co., No. 90-12553, slip op. at 2, 1993 WL 795440 (D.Mass. Feb. 19, 1993). The second group consisted of two agents, Gregory Pope (“Pope”) and Curt Everett (“Everett”), each of whom had executed an “R1500 Agent Employment Agreement,” allegedly distinguishing their claims from those of their brethren.
In managing the case, the Court ordered that Allstate first file a motion for summary judgment as to the first five named plaintiffs: William Gochis (“Gochis”), Frank Antonuccio (“Antonuccio”), Michael Argeros (“Argeros”), James Ambrose (“Ambrose”), and John Arn-berg (“Arnberg”). Allstate did so, and prevailed. Allstate then moved, pursuant to the Court’s scheduling order, for summary judgment on the claims of the remaining seventy-four plaintiffs. The Court had instructed the Agents that in order to prevent summary judgment against them on the remaining claims, they were required to “explain[ ] each reason why such claims of other plaintiffs are dissimilar or why summary judgment otherwise should not be entered with respect to such claims.” The Agents conceded that seventy-two of the seventy-four remaining agents’ claims were similar to those of the first five, and merely opposed entry of summary judgment against Pope and Everett. At a hearing on April 8, 1993, the Court granted Allstate’s motion for summary judgment as to all remaining plaintiffs.
1. Deposition Expenses
Fees of the court reporter for all or any part of a “stenographic transcript necessarily obtained for use in the case” is taxable. 28 U.S.C.A. § 1920(2) (West 1994). The cost of taking and transcribing depositions falls within this subsection. Templeman v. Chris Craft Corp., 770 F.2d 245, 249 (1st Cir.), cert.
2. Photocopying Charges
Fees for “exemplification and copies of papers necessarily obtained for use in the case” are taxable. 28 U.S.C.A. § 1920(4) (West 1994). Allstate seeks reimbursement only for the amount it was charged by the Agents for the production of documents, generously eschewing payment for copies made internally in preparation of its defense. The company argues that it was ordinary, necessary, prudent and good practice for it to request, review and copy the Agents’ documents; the Court does not disagree. Allstate goes on to say, however, that because these documents were studied by its counsel, referred to over months of discovery, and many used in depositions and submitted on summary judgment, they were “necessarily obtained” and their cost must be taxed to the Agents. AEstate gives but one vague example involving documents produced by one of the Agents, WiEiam Flanagan, to demonstrate how critical the documents were to AEstate’s success. On the other hand, the Agents argue that most of the documents used by AEstate on summary judgment were documents already in the company’s possession and which were not produced by the Agents. The Agents say further that AE-state unnecessarily obtained discovery on aE seventy-nine plaintiffs, instead of the five principals whose claims were the focus of the first motion, and should not be rewarded for its failure to Emit its discovery requests and present an efficient defense to the Court.
The Court agrees with the Agents. Once again, Allstate improperly blurs the distinction between case preparation and case resolution. Most, if not aE, of the documents upon which the motions for summary judgment rested were AEstate’s own documents, and many of the documents obtained were used in depositions the costs of which the Court has already held are not taxable. Therefore, even if the documents obtained were reasonably appropriate to AEstate’s defense, the Court declines to tax such costs in exercise of its discretion.
3. Costs of Appeal
The Agents concede that AEstate is entitled to the costs of its successful appeal in the amount of $1,955.80 — $1,850.80 allowed by the mandate of the Court of Appeals plus the $105 fifing fee. The Court therefore allows those costs.
III. Conclusion
AEstate’s Supplementary BiE of Costs is aEowed to the following extent: $7,539.30 for deposition transcripts necessarily obtained for use in the ease pursuant to 28 U.S.C. section 1920(2) and appeal costs in the amount of $1,955.80 pursuant to Rule 39 of the Federal Rules of AppeEate Procedure. The Supplementary BiE is denied in all other respects.
. Attributed to the English novelist, philosopher, and physicist C.P. Snow. See Skulls and Numbskulls, Economist, Nov. 21, 1992, at 103; John Mixon & Gordon Otto, Symposium: Applying Quality Management Concepts to the Law, 43 Emory L.J. 393, 482 (1994).
. The Bill of Costs also sought reimbursement for clerk fees ($172.50); court reporter fees ($113); docket fees ($137.50); and costs of appeal ($349.30).
. The statute provides:
A judge or clerk ... may tax as costs the following:
(1) Fees of the clerk and marshal;
(2) Fees of the court reporter for all or any part of the stenographic transcript necessarily obtained for use in the case;
(3) Fees and disbursements for printing and witnesses;
(4) Fees for exemplification and copies of papers necessarily obtained for use in the case;
(5) Docket fees under section 1923 of this title;
(6) Compensation of court appointed experts, compensation of interpreters, and salaries, fees, expenses, and costs of special interpretation services under section 1828 of this title.
28 U.S.C.A. § 1920 (West 1994).
. The First Circuit has acknowledged as much in this case by its use of the phrase "have proven clearly unnecessary, irrelevant, or cumulative ...” Gochis v. Allstate Ins. Co., No. 94-1773, slip op. at 2, 1994 WL 697285 (1st Cir. Dec. 14, 1994) (per curiam) (emphasis supplied).
. Allstate submitted 13 affidavits and excerpts from 42 transcripts of 23 deponents in support of its first motion for summary judgment. Examples of repetitious and cumbersome string cites abound: six depositions to show the company provided training to agents; three depositions and an affidavit to show the agents were evaluated periodically; two depositions and an affidavit to show the banal point that management emphasized the need to write profitable business; three depositions and an affidavit to show that Allstate generally paid the Agents’ expenses; and six depositions and an affidavit to show the Agents received a variety of benefits, including paid holidays and vacations.
. Attempting to demonstrate the absence of genuine issues of material fact, Allstate went so far as to tell the Court that the extensive materials it submitted
anticipate plaintiffs' expected submission of facts which Allstate believes are immaterial to the current state of the legal principles that govern their claims. These facts also provide the Court with a useful context for understanding the events at issue. Defendant's Memorandum in Support of First Motion for Summary Judgment at 1 n. 1 (emphasis supplied). Allstate simply cannot have it both ways.
. Contrary to Allstate's assertion, Papas v. Han-lon, 849 F.2d 702 (1st Cir.1988) does not stand for the proposition that in "virtually every lawsuit” involving multiple plaintiffs a successful defendant is entitled to the cost of deposing each plaintiff. In Papas, the district court taxed deposition costs where the plaintiffs had failed to show up for their depositions. Although the depositions were, of course, never put in evidence, the First Circuit concluded the trial court had not abused its discretion in awarding costs. The court noted that "plaintiffs' depositions are reasonable and necessaiy steps in the preparation of a defendant’s case.” Id. at 704 (citing In re Puerto Rico Elec. Power Auth., 687 F.2d 501, 507 [1st Cir.1982]). Papas thus holds that it is within the discretion of the district court to tax, or not to tax, such costs even if the depositions are not submitted in evidence.