Kaiser Industries Corp. v. McLouth Steel Corp.

50 F.R.D. 5, 14 Fed. R. Serv. 2d 627, 1970 U.S. Dist. LEXIS 12036
CourtDistrict Court, E.D. Michigan
DecidedApril 17, 1970
DocketCiv. A. No. 16900
StatusPublished
Cited by37 cases

This text of 50 F.R.D. 5 (Kaiser Industries Corp. v. McLouth Steel Corp.) is published on Counsel Stack Legal Research, covering District Court, E.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kaiser Industries Corp. v. McLouth Steel Corp., 50 F.R.D. 5, 14 Fed. R. Serv. 2d 627, 1970 U.S. Dist. LEXIS 12036 (E.D. Mich. 1970).

Opinion

OPINION

FREEMAN, Chief Judge.

In 1957, plaintiffs, hereinafter referred to as Kaiser, filed suit against McLouth Steel Corporation, alleging that McLouth was infringing their patent relating to a method for the production of steel. In 1966, after a trial which required 150 days, this court issued its Opinion holding that the patent relied upon by plaintiff was invalid “under 35 U.S.C. § 112 for failure of the claims to particularly point out and distinctly claim the subject matter which the applicants regarded as their invention.” Henry J. Kaiser Co. v. McLouth Steel Corp., D.C., 257 F.Supp. 372, 442.

On November 5, 1969, the defendant filed its Bill of Costs seeking to tax $178,202.60 in costs against Kaiser. On November 21, 1969, a hearing was held on the proposed Bill of Costs. Briefs have been filed by both parties.

Kaiser opposes all items proposed to be taxed except:

1. Appeal fee of the Clerk — $5.00;
2. Marshal’s fees — $17.28;
3. Docket fees, authorized by 28 U. S.C. § 1923, itemized in Schedule V — $50.00; and
4. Costs on the Mandate of the Court of Appeals — $7,938.66.

The total of these items is $8,010.04, leaving $170,192.56 in dispute.

It is convenient to first set out the basis of this court’s authority to tax costs. Rule 54(d) provides in relevant part:

“Costs. Except when express provision therefor is made either in a statute of the United States or in these rules, costs shall be allowed as of course to the prevailing party unless the court otherwise directs; * *

Also relevant are 28 U.S.C. § 1920 (dealing with taxation of costs generally), Section 1923 (docket fees and costs of briefs) and Section 1821 (witness fees).

As a general proposition, the prevailing party is entitled to costs in [8]*8the District Court; however, Rule 54(d) immediately qualifies this by the phrase “unless the court otherwise directs.” This qualification states an equitable principle and vests in the District Court a sound discretion over the allowance, disallowance, or apportionment of costs in all civil actions. 6 Moore’s Federal Practice, § 54.70[5] at p. 1308. On this point at least the parties appear to be in agreement.

Kaiser argues, however, that it prevailed on many of the issues to which individual cost items relate, and therefore these cost items should not be taxed against it. Implicit in this argument is the theory that defendant, Mc-Louth, is not entitled to tax costs relating to individual issues on which it lost, even though it ultimately prevailed. Rule 54(d) does not speak in terms of the party who won on any given issue; rather it speaks of the “prevailing party.” Professor Moore has pointed out:

“Although a plaintiff may not sustain his entire claim, if judgment is rendered for him he is the prevailing party. Thus the costs of witnesses, who testify only upon an issue decided adversely to the party who calls them, may, nevertheless, be allowed to the party if he finally prevails in the action.” 6 Moore’s Federal Practice, § 54.70[4] pp. 1305-1306. [Emphasis added.]

See also Ryan v. Arabian American Oil Co., 18 F.R.D. 206 (S.D.N.Y.1955), and Bowman v. West Disinfecting Company, 25 F.R.D. 280 (E.D.N.Y.1960). The court may nonetheless consider the number of issues involved and those upon which the prevailing party won in exercising its discretion in allowing or disallowing costs.

The Supreme Court has also noted on several occasions its concern that the costs of litigation be kept to a minimum and that this policy should be of foremost concern to the District Court in exercising its discretion in taxing costs.

“We do not read that Rule [Rule 54(d)] as giving district judges unrestrained discretion to tax costs to reimburse a winning litigant for every expense he has seen fit to incur in the conduct of his case. Items proposed by winning parties as costs should always be given careful scrutiny. Any other practice would be too great a movement in the direction of some systems of jurisprudence, that are willing, if not indeed anxious, to allow litigation costs so high as to discourage litigants from bringing lawsuits, no matter how meritorious they might in good faith believe their claims to be. Therefore, the discretion given district judges to tax costs should be sparingly exercised with reference to expenses not specifically allowed by statute. Such a restrained administration of the Rule is in harmony with our national policy of reducing insofar as possible the burdensome cost of litigation.” Farmer v. Arabian American Oil Company, 379 U.S. 227, 235, 85 S.Ct. 411, 416, 13 L. Ed.2d 248 (1964).

With this background, attention can now be focused on the individual items of cost which are disputed by Kaiser.

Transcript Costs ($10,202.50). Defendant seeks to tax against plaintiffs the fees of the court reporter for the transcripts of the pretrial, trial, and post-trial hearings. These fees are itemized in Schedule II of defendant’s proposed Bill of Costs. The $10,202.50 sought to be taxed consists of one-half of the cost of the copy of the transcript supplied to the court and the cost of one copy supplied to defendant’s counsel for the enumerated hearings. The largest portion of this cost is $8,669.40 for the trial transcript. 28 U.S.C. § 1920(2) provides that a judge of any court of the United States may tax as costs the “fees of the court reporter for all or any part of the stenographic transcript necessarily obtained for use in the case.”

There seems little dispute that the court has the power to tax defendant’s share of the cost for the copy of the transcript supplied to the court. How[9]*9ever, there is a conflict in the cases, beginning with Stallo v. Wagner, 245 F. 636, 641-642 (2nd Cir.1917), as to whether a court may properly tax the cost of the transcript ordered by the attorney of the prevailing party. Professor Moore takes the position that this is, and should be, a taxable cost. He is supported in this position by most of the recent cases dealing with the point. See 6 Moore’s Federal Practice, § 54.77 [7] and Syracuse Broadcasting Corp. v. Newhouse, 319 F.2d 683 (2nd Cir.1963).

Since the- court concludes that it does have the power to tax the cost of both the court’s copy and the prevailing party’s copy of the transcript, the question becomes how the court should exercise its discretion in this matter. It would appear from both the length of trial and complexity of the case that a daily transcript • of the testimony and final arguments was reasonably necessary for proper trial and decision of the ease. Consequently, defendant should be permitted to tax the cost of its copy of the transcript and its share of the court’s copy of the transcript of the trial and final arguments, a total of $9,382.35.

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Bluebook (online)
50 F.R.D. 5, 14 Fed. R. Serv. 2d 627, 1970 U.S. Dist. LEXIS 12036, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kaiser-industries-corp-v-mclouth-steel-corp-mied-1970.