Opinion
Case Number C 03-01075 JF (PVT), Docket No. 129.
September 14, 2004
ORDER DENYING PLAINTIFF'S MOTION TO SET ASIDE BILL OF COSTS
Following entry of judgment in the above-entitled action, Defendants submitted to the Clerk of the Court a bill of costs, which Plaintiff opposed. The Clerk substantially reduced the amount of costs to be awarded. Plaintiff now moves to set aside the bill of costs in its entirety. The Court has considered the papers filed by the parties. For the reasons set forth below, the motion will be denied.
I. BACKGROUND
This action arose from Defendants' refusal to employ Plaintiff for two positions advertised by Defendant Monterey Institute of International Studies ("MIIS") in 2002. Believing that employees of MIIS had committed numerous civil rights violations in failing to hire her, Plaintiff filed suit in this Court on March 13, 2003. On August 21, 2003, the Court dismissed several of Plaintiff's claims with leave to amend. The claims that remained alleged were gender and national origin discrimination pursuant to Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e, et seq., age discrimination pursuant to the Age Discrimination in Employment Act of 1967, and race discrimination pursuant to 42 U.S.C. § 1981, as well as related claims pursuant to 42 U.S.C. § 1985 and 42 U.S.C. § 1986. Concluding that Plaintiff failed to establish a prima facie case as to her substantive claims, the Court granted Defendants' motion for summary judgment and entered judgment for Defendants on May 5, 2004.
Since entry of judgment, the Court has denied Plaintiff's motion for leave to file a motion for reconsideration, concluding that Plaintiff has not presented any new facts or law that would change the outcome of its Order granting Defendants' motion for summary judgment. Plaintiff has appealed the case to the United States Court of Appeals for the Ninth Circuit.
On May 19, 2004, Defendants filed a bill of costs, seeking costs of $16,623.10 pursuant to Federal Rule of Civil Procedure 54(d)(1) and Civil Local Rule 54. Plaintiff filed opposition, asserting, among other things, that the claimed costs could not be taxed under Civil Local Rule 54 and that, because of her unemployment and limited financial resources, she was unable to pay any costs. On June 24, 2004, the Clerk of the Court allowed costs in the reduced sum of $2,838.35, having concluded that many of the costs claimed by Defendants were not allowable under the applicable rules. Plaintiff responded with the instant motion to set aside the bill of costs in its entirety because of her indigency.
II. APPLICABLE LAW
Federal Rule of Civil Procedure 54(d)(1) ("Rule 54(d)(1)") provides that, "[e]xcept 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." This rule creates a "presumption for awarding costs to prevailing parties" and thus requires the losing party to show why costs should not be awarded. Save Our Valley v. Sound Transit, 335 F.3d 932, 944-45 (9th Cir. 2003). The Court must specify reasons if it refuses to tax costs to the losing party. See id. at 945. However, the Court "need not give affirmative reasons for awarding costs; instead, it need only find that the reasons for denying costs are not sufficiently persuasive to overcome the presumption in favor of an award." Id.
The Court may consider a variety of factors in deciding whether to award costs, including whether the losing party has limited financial resources, see Ass'n of Mexican-American Educators v. California, 231 F.3d 572, 592 (9th Cir. 2000); Stanley v. Univ. of S. Cal., 178 F.3d 1069, 1079 (9th Cir. 1999) (stating that indigency is a factor district courts may properly consider when deciding whether to award costs), whether an award of costs would "chill" future civil rights litigation, see Save Our Valley, 335 F.3d at 946 (holding that imposition of the "relatively small sum" of $5,310.55 would not result in injustice where a community group lost its race-based civil rights claim against a government agency), and whether the prevailing party has engaged in misconduct such that costs should not be awarded, see Ass'n of Mexican-American Educators, 231 F.3d at 592. However, "[n]oble intentions alone do not relieve an unsuccessful litigant of the obligation under Rule 54(d) to compensate his opponent for reasonable costs." Nat'l Info. Servs., Inc. v. TRW, Inc., 51 F.3d 1470, 1472 (9th Cir. 1995) (holding that the district court abused its discretion when it "refused to award costs on the ground that Plaintiffs brought their case in good faith and with meritorious intentions when in fact they brought a case so devoid of merit that they were twice rejected by the district court on summary judgment").
The trial court has "wide discretion" in awarding costs pursuant to Rule 54(d). K-S-H Plastics, Inc. v. Carolite, Inc., 408 F.2d 54, 60 (9th Cir. 1969). Its decision will not be overturned on appeal unless the court has abused its discretion. See Trans Container Servs. (Basel) A.G. v. Sec. Forwarders, Inc., 752 F.2d 483, 488 (9th Cir. 1985).
III. DISCUSSION
Plaintiff moves to set aside Defendants' bill of costs on the basis of her indigency. To prove that she has no ability to pay Defendants' costs, she asserts that she has been unemployed since 1996. Declaration in Support of Motion to Set Aside Bill of Costs ("Plaintiff's First Declaration"), p. 1. She states that she presently works as a realtor but that she has yet to complete a sale to generate any income. Id. She further declares that she has not received any income in the last twelve months, that she does not have any money in a checking or savings account, and that she does not own any real estate, stocks, bonds, notes, or other "valuable property (excluding ordinary household furnishings and clothing)." Id. Although she is the co-owner of two cars with a combined value of approximately $13,500.00, she states that she has no equity in either vehicle. Id.; Plaintiff's Declaration in Support of Reply to Opposition to Motion to Set Aside the Bill of Costs ("Plaintiff's Second Declaration"), p. 1. In order to pay for her own legal costs in bringing both this lawsuit and two unsuccessful lawsuits against her former employer, Defense Language Institute ("DLI"), she says that she has obtained personal loans that she has yet to repay and that she has become dependent on her son, who has spent "all of his income and savings" to enable her to pursue her legal claims. Plaintiff's First Declaration, pp. 1-2. Finally, as further proof of her indigent status, Plaintiff has submitted a copy of a medical card that she states entitles her to three months of free health insurance coverage at Natividad Medical Center based on proof of indigency. Id. at 2. She says that this coverage has been provided to her for the past several years. Motion to Set Aside Bill of Costs ("Motion"), p. 3.Defendants do not dispute Plaintiff's claims of indigency. Instead, they argue that it is "well established" that a losing party's claims of financial hardship are insufficient to deny a prevailing party its "statutorily awarded costs." Memorandum of Points and Authorities in Opposition to Plaintiff's Motion to Set Aside Statutorily Awarded Costs ("Opposition"), p. 1. The practical effect of having the opposite rule, they maintain, is that indigent parties would be insulated from ever having to pay costs pursuant to Rule 54(d). Id. However, Defendants incorrectly claim that Ninth Circuit precedent establishes that a losing party's indigency may be considered only as one factor in deciding whether to reduce costs and not as a basis for denying costs altogether. See id. at 5. A district court may properly consider a losing party's indigency when deciding whether to award costs, not merely whether to reduce costs. Stanley, 178 F.3d at 1079.
Defendants similarly are incorrect to extract the purported general rule that, when "a party loses a case which has not been shown to be `substantially meritorious,' full costs should be awarded, notwithstanding the hardship such an award would impose upon the losing party" from the district court's opinion in Coulter v. Newmont Gold Co. Opposition, p. 5. This standard is narrower than the applicable standards articulated by the Ninth Circuit. Indeed, the court in Coulter emphasized that its decision was a "narrow one, based on the facts of this case." Coulter v. Newmont Gold Co., 873 F. Supp. 394, 397 (D. Nev. 1994). This Court will apply the standards set forth by the Ninth Circuit.
Defendants also argue that they have not engaged in any misconduct, such as calling unnecessary witnesses or raising unnecessary issues, to warrant a denial of costs. They note that they took only one deposition in this action, with all other depositions being noticed by Plaintiff, and that they timely moved for summary judgment. Opposition, p. 4. Although misconduct of a prevailing party may be grounds for refusing an award of costs, Ass'n of Mexican-American Educators, 231 F.3d at 592, Plaintiff's motion to set aside the bill of costs does not appear to be based on such a claim. Plaintiff repeatedly asserts her belief that Defendants have "brought fraud on [the] Court" and have produced "tampered documents and contradictory testimonies," but these arguments appear to reflect her generalized grievances against Defendants rather than specific arguments with respect to costs she believes have been taxed improperly under the governing rules. See, e.g., Motion, p. 3; Reply to Defendants' Opposition to Plaintiff's Motion to Set Aside Bill of Costs, pp. 2-3.
Indeed, Plaintiff appears to be using the occasion of the present motion to continue to argue the merits of her underlying action, which ended with the Court's judgment on May 5, 2004. The Court will not entertain these arguments.
Finally, Defendants imply that Plaintiff's claimed inability to pay costs already has been reflected in the Clerk of the Court's reduction of taxable costs from $16,623.10 to $2,838.35. Opposition, p. 5. However, the Clerk's disallowance of approximately $14,000.00 in claimed costs was based on the lack of authority under the Federal Rules of Civil Procedure and the Civil Local Rules for awarding those costs and did not take into account Plaintiff's indigency. Thus, the fact that the Clerk substantially reduced the costs taxed from the amount originally claimed by Defendants is irrelevant to the present motion.
While the Court is sympathetic to Plaintiff's circumstances and her sincere belief that Defendants have wronged her in ways that are redressable through the legal system — a belief that has fueled not only her lawsuit in this Court (and others) but also her decision to appeal the Court's judgment to the Ninth Circuit — the Court is unpersuaded that Plaintiff has overcome the presumption in favor of an award of costs to the prevailing party pursuant to Rule 54(d)(1). The Court acknowledges that paying even a portion of the costs of the instant litigation may cause some hardship to Plaintiff, and the Court agrees that civil rights litigants should not be prevented from bringing colorable lawsuits for alleged violations of their rights by the spectre of the hefty costs that may be imposed upon them should they not prevail.
However, imposition of costs in this case does not represent one of the "rare occasion[s] where severe injustice will result from an award of costs (such as the injustice that would result from an indigent plaintiff's being forced to pay tens of thousands of dollars of her alleged oppressor's legal costs)." Save Our Valley, 335 F.3d at 945. A sum of $2,838.35 is not an exorbitant amount of costs to tax to the losing party in a case that has been litigated through several rounds of motions, especially when Plaintiff has presented no specific evidence of misconduct on the part of Defendants that would justify setting aside the bill of costs. Such a sum is unlikely to "chill" future civil rights litigation. Moreover, it would be inequitable to allow Plaintiff to insulate herself entirely from payment of Defendants' costs based on her lack of income when she has remained unemployed for over seven years despite apparent training and abilities that should enable her to obtain some gainful employment that would render her capable of paying the costs of her unsuccessful lawsuits.
IV. ORDER
Good cause therefore appearing, IT IS HEREBY ORDERED that Plaintiff's motion to set aside the bill of costs is DENIED and that Plaintiff pay Defendants costs in the amount of $2,838.35.