In re: CARDIZEM CD ANTITRUST LITIGATION. EUGENIA WYNNE SAMS, Plaintiff-Appellant, GORDON BALL, Attorney-Appellant, v. STATE ATTORNEYS GENERAL; STATE LAW PLAINTIFFS, Plaintiffs-Appellees, STATE OF TENNESSEE, Defendant-Appellee, HOECHST AKTIENGESELLSCHAFT, et al., Defendants.
No. 05-2375
United States Court of Appeals for the Sixth Circuit
Decided and Filed: February 22, 2007
476 F.3d 417
RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Sixth Circuit Rule 206. File Name: 07a0071p.06. Appeal from the United States District Court for the Eastern District of Michigan at Detroit. No. 99-73190—Nancy G. Edmunds, District Judge. Argued: December 8, 2006. Before: CLAY, ROGERS, and SUTTON, Circuit Judges.
COUNSEL
ARGUED: Gordon Ball, BALL & SCOTT, Knoxville, Tennessee, for Appellants. Jay Himes, ATTORNEY GENERAL, STATE OF NEW YORK, New York, New York, for Appellees. ON BRIEF: Gordon Ball, BALL & SCOTT, Knoxville, Tennessee, for Appellants. Jay Himes, Robert L. Hubbard, ATTORNEY GENERAL, STATE OF NEW YORK, New York, New York, Michelle M. Rick, OFFICE OF THE ATTORNEY GENERAL, Lansing, Michigan, for Appellees.
OPINION
SUTTON, Circuit Judge. At the end of a case, “costs” are awarded to prevailing parties “as of course” for an assortment of trial-related expenses—such as court fees, court reporter fees and, as pertinent here, “compensation of court appointed experts.”
I.
In 1997, Hoechst Marion Roussel and Andrx Pharmaceuticals allegedly conspired to minimize competition for one of Hoechst‘s products—Cardizem CD, which is prescribed for the treatment of angina (chronic chest pains) and high blood pressure as well as for the prevention of heart attacks and strokes. In connection with the alleged conspiracy, Hoechst paid Andrx nearly $90 million in return for Andrx keeping a competing generic drug off the market. In August 1998, individual consumers (the “state law plaintiffs“) filed what would become the first of 19 state law actions against the companies, and in 1999 the Judicial Panel on Multidistrict Litigation transferred the actions to the Eastern District of Michigan. The attorneys general of all 50 States, Puerto Rico and the District of Columbia (the “attorneys general“) eventually joined the litigation on behalf of their States and as parens patriae on behalf of the residents of their respective jurisdictions.
On January 29, 2003, the district court preliminarily approved an $80 million settlement of all of the claims. The proposed settlement class consisted of “[a]ll consumers and Third Party Payers . . . who purchased and/or paid all or part of the purchase price of Cardizem CD Products” during the relevant time frame, including “all members of any class or classes asserted in any State Action.” JA 390–91. On October 21, 2003, after conducting a fairness hearing concerning the settlement, the court certified the settlement class and granted final approval of the settlement agreement.
Eugenia Sams is a Tennessee resident who purchased Cardizem CD during the time period implicated by the alleged conspiracy. Represented by Gordon Ball, she filed a complaint against the defendants in Tennessee state court in 1998, alleging violations of the Tennessee Trade Practices Act and the Tennessee Consumer Practices Act. The drug companies removed her case to federal district court, after which the court transferred the case to the Eastern District of Michigan along with the other state law actions.
Sams objected to the settlement. While she was not alone in doing so, she was nearly so: she was one of just two class members (out of 37,387) who objected to the settlement. The court found little to be said for her objections, concluding that they were “all without merit.” JA 569.
Sams appealed the district court‘s settlement-approval order. In response, the state law plaintiffs and the attorneys general sought, and obtained, permission to require Sams to post an appeal bond. See
On December 14, 2004, the Sixth Circuit resolved Sams’ appeals in a single opinion. See In re Cardizem CD Antitrust Litigation, 391 F.3d 812 (6th Cir. 2004). The court affirmed the appeal
On remand, the state law plaintiffs and the attorneys general filed a motion to charge Sams with (1) the administrative costs caused by the delay ($255,683) under
The district court granted the motion for costs under
The court declined to award attorney fees under the Tennessee statute. It first acknowledged uncertainty over whether the law authorized such fees, then explained that, because counsel for the state law plaintiffs and the attorneys general already had been adequately compensated in the case, it “would exercise its discretion and not award these requested” fees even if Tennessee law permitted them. JA 378.
The court denied the
II.
On appeal, Ball challenges the district court‘s authority to issue the costs award—first because the relevant provisions at most allow costs to be imposed on parties, not their attorneys, and second because Rust Consulting was not a “court appointed expert.” We give fresh review to questions about the meaning of
A.
Costs Other than Attorneys’ Fees. Except when express provision therefor is made either in a statute of the United States or in these rules, costs other than attorneys’ fees shall be allowed as of course to the prevailing party unless the court otherwise directs; but costs against the United States, its officers, and agencies shall be imposed only to the extent permitted by law. Such costs may be taxed by the clerk on one day‘s notice. On motion served within 5 days thereafter, the action of the clerk may be reviewed by the court.
A judge or clerk of any court of the United States may tax as costs the following:
- Fees of the clerk and marshal;
- Fees of the court reporter for all or any part of the stenographic transcript necessarily obtained for use in the case;
- Fees and disbursements for printing and witnesses;
- Fees for exemplification and copies of papers necessarily obtained for use in the case;
- Docket fees under section 1923 of this title;
- Compensation of court appointed experts, compensation of interpreters, and salaries, fees, expenses, and costs of special interpretation services under section 1828 of this title.
A bill of costs shall be filed in the case and, upon allowance, included in the judgment or decree.
The Supreme Court has set the table for resolving this dispute by giving us two pieces of guidance about the interrelation of the statute and the rule. The costs that courts may tax under
At least one problem with the costs award in this case is that
Also supporting this interpretation are other provisions that expressly permit costs and fees to be imposed on attorneys.
The express authorization to allow courts to impose these costs on attorneys, and to do so only after the attorney has engaged in misconduct, suggests that neither
Only one court of appeals case, to our knowledge, has considered this issue, and it reached the same conclusion. In rejecting a similar argument, the Second Circuit explained that ”
In defending the district court‘s order, the state law plaintiffs and attorneys general persist that courts nonetheless retain “equitable discretion” to impose costs on attorneys. But the purpose of
Nor do the two cases cited in support of this equitable-discretion proposition—Carter-Jones Lumber Co. v. Dixie Distributing Co., 166 F.3d 840 (6th Cir. 1999), and Singleton v. Smith, 241 F.3d 534 (6th Cir. 2001)—advance it. While Carter-Jones says that “a court of equity has traditionally had the power to fashion any remedy deemed necessary and appropriate to do justice in a particular case,” 166 F.3d at 846, it does not address how
The state law plaintiffs and attorneys general next point out that courts may order attorneys to pay costs and damages to prevailing appellees under
B.
The state law plaintiffs and attorneys general next offer two alternative bases for affirming the district court‘s order. See City Mgmt. Corp. v. U.S. Chem. Co., Inc., 43 F.3d 244, 251 (6th Cir. 1994) (noting that appellate courts may affirm on alternative grounds supported by the record). They first point out that, when this case initially came before our court, we held that the district court was entitled to include Rust‘s projected “administrative costs” as part of the
Equally unavailing is the second alternative ground offered for affirmance—
III.
Our determination that the district court should not have imposed this costs award on Ball suffices to resolve this appeal. We therefore need not decide the second question presented: whether
First. In 1975, when Congress enacted the Federal Rules of Evidence, see Pub. L. No. 93-595, 88 Stat. 1926 (1975), it included
Second. The complementary relationship between
Third. The legislative history suggests a linkage between
Fourth. To the extent Congress meant to link
Fifth. Even if
Sixth. Gaddis does not stand alone. Other courts have reached a different conclusion. See Nat‘l Org. for the Reform of Marijuana Laws v. Mullen, 828 F.2d 536, 545 n.7 (9th Cir. 1987) (noting that “the words ‘court appointed experts’ in
IV.
For these reasons, we reverse the district court‘s order taxing Ball with settlement administration expenses incurred by Rust Consulting.
