Architectural Contractors, Inc. et al v. Schilli Transportation Services, Inc.
MEMORANDUM OPINION AND ORDER granting in part and denying in part 47 Motion for Bill of Costs. Signed by Honorable Timothy L. Brooks on December 29, 2014. (rg)
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
ARCHITECTURAL CONTRACTORS, INC.
and THE CINCINNATI INSURANCE COMPANY, INC.
CASE NO. 5:13-CV-05179
SCHILLI TRANSPORTATION SERVICES, INC.
MEMORANDUM OPINION AND ORDER
Currently before the Court are Plaintiffs Architectural Contractors, Inc.’s (“ACI”) and
The Cincinnati Insurance Company, Inc.’s (“CIC”) Motion for Costs and Prejudgment
Interest and brief in support (Docs. 47 and 48); Defendant Schilli Transportation Services,
Inc.’s (“Schilli”) Response in Opposition and brief in support (Docs. 50 and 51); and
Plaintiffs’ Reply (Doc. 52). For the reasons explained herein, Plaintiffs’ Motion (Doc. 47)
is GRANTED IN PART AND DENIED IN PART. The Court grants Plaintiffs’ request for
prejudgment interest and costs, but declines to award Plaintiffs’ total cost request of
Instead, the Court awards Plaintiffs $2,840.45 in costs and $15.83 in
Plaintiffs brought suit against Schilli, pursuant to the Carmack Amendment of the
Interstate Commerce Act, 49 U.S.C. §14706, for damages sustained to certain wall panels
transported by Schilli to ACI’s job site in Springdale, Arkansas. Schilli denied that its driver,
Douglas Edwards, delivered the panels in damaged condition, and contended that at least
some of the damages claimed by ACI were unforeseeable. Schilli further contended that
Plaintiffs’ claim was barred by a nine-month statute of limitations. The case came on for
a one-day bench trial on December 1, 2014. For the reasons set forth in its Opinion and
Order (Doc. 49), the Court found for Plaintiffs. The Court awarded Plaintiffs $6,375.76 in
compensatory damages, which represents the replacement cost of the 55 damaged wall
panels and fasteners.
Plaintiffs now request an award of prejudgment interest and costs, and supports its
request with a number of exhibits, including: a Bill of Costs (Doc. 47-1); invoices for the
depositions conducted on Jean McMillian and Douglas Edwards (Doc. 47-2); and an
affidavit written by Plaintiffs’ counsel confirming that the itemization is accurate (Doc. 47-3).
The Court will address Plaintiffs’ requests for prejudgment interest and costs in turn.
A. Prejudgment Interest
Plaintiffs seek an award of prejudgment interest, but fail to make a specific request
or brief a calculation methodology. Schilli disputes that Plaintiffs are entitled to an award
of prejudgment interest due to the unreasonable delay in reporting any damage to Schilli.
Schilli also contends it should not be ordered to pay interest because the issue of liability
was highly challenged, and the Court’s ruling was closely decided. In the alternative, Schilli
requests that any prejudgment interest begin on May 23, 2013, the date Plaintiffs first
reported the loss to Schilli.
Schilli’s liability was determined at trial, and the Court calculated the amount of
damages through the invoices introduced into evidence. Because Plaintiffs’ damages were
reasonably ascertainable from the date of accrual, Plaintiffs are entitled to prejudgment
interest. See Stroh Container Co. v. Dephi Industries, Inc., 783 F.2d 743, 752 (8th Cir.
1986). The basic purpose of prejudgment interest is to ensure that a party is fully
compensated for its loss. See City of Milwaukee v. Cement Div. Nat'l Gypsum Co., 515
U.S. 189, 195 (1995). Further, it is appropriate to award compound, rather than simple
interest in federal cases. “[A]bsent special circumstances, compound, not simple, interest
ought to be awarded in Carmack Amendment cases.” Am. Nat’l Fire Ins. Co. v. Yellow
Freight Sys. Inc., 325 F.3d 924, 937 (7th Cir. 2003).
Unlike in cases before this Court solely on the basis of diversity jurisdiction, wherein
the Supreme Court's ruling in Erie R.R. v. Tompkins, 304 U.S. 64 (1938), dictates that the
issue of prejudgment interest be determined with reference to various state laws, see
Capella Univ., Inc. v. Executive Risk Specialty Ins. Co., 617 F.3d 1040, 1052 (8th Cir.
2010) (internal citation omitted), the present action is before the Court on a federal
question and therefore federal law governs the rate of prejudgment interest, see Bishop
v. Pennington Cnty., 2009 WL 1364887, at *2 (D. S.D. May 14, 2009) (citing Mansker v.
TMG Life Ins. Co., 54 F.3d 1322, 1330 (8th Cir. 1995)).
The first issue the Court must address is the appropriateness of awarding
prejudgment interest in this case. This Court is not aware of any reason why prejudgment
interest would be inappropriate in this action. The awarding of prejudgment interest
“ensure[s] that an injured party is fully compensated for its loss,” City of Milwaukee, 515
U.S. at 195, by requiring that “[o]ne who has had the use of money owing to another . . .
pay interest from the time payment should have been made,” Miller v. Robertson, 266 U.S.
243, 257–58 (1924). Here, the Court has determined that Schilli has had use of $6,375.76
which rightfully was owed to Plaintiffs as of May 23, 2013. Therefore the award of
prejudgment interest in this case is appropriate.
The next issue to be resolved is the correct date on which prejudgment interest
should begin to accrue. Prejudgment interest typically accrues from the date of the loss
or from the date on which the claim accrued. See W. Va. v. United States, 479 U.S. 305,
310 n.2 (1987). The Court has broad discretion in making this determination. Indep. Bulk
Transp., Inc. v. The Vessel “Morania Abaco,” 676 F.2d 23, 25 (2d Cir.1982). The parties
have suggested two different dates for the Court's consideration. Plaintiffs contend that
the relevant date is the date of loss, while Schilli argues that the date the claim was made
is the proper date for prejudgment interest to accrue. The facts revealed that Plaintiffs did
not make a claim until nearly two years after the shipment arrived in damaged condition,
and therefore the Court finds that it is equitable for the interest to run from the date Plaintiff
first alerted Schilli as to the loss, May 23, 2013, through the date of the Court’s Opinion
and Order on December 10, 2014.
Finally, this Court must decide the applicable rate of prejudgment interest. Plaintiffs
have not submitted any calculations regarding interest rates; however, Schilli provided a
rate schedule from the United States Department of Treasury, dating from 2013. The
appropriate rate of interest is left to the discretion of the district court. See N.Y. Marine &
Gen. Ins. Co. v. Tradeline (L.L.C.), 266 F.3d 112, 130–31 (2d Cir. 2001). See also Werner
Enterprises, Inc. v. Westwind Mar. Int'l, Inc., 554 F.3d 1319, 1328 (11th Cir. 2009) (“In the
absence of a controlling statute, the choice of a rate at which to set the amount of
prejudgment interest is also within the discretion of a federal court.”). “That decision is
‘guided by principles of reasonableness and fairness, by relevant state law, and by the
relevant fifty-two week United States Treasury bond rate, which is the rate that federal
courts must use in awarding post-judgment interest.’” In re Int'l Admin. Serv., Inc., 408 F.3d
at 710 (quoting Indus. Risk Insurers v. M.A.N. Gutehoffnungshutte GmbH, 141 F.3d 1434,
1447 (11th Cir. 1998) (citing 28 U.S.C. § 1961)). Although 28 U.S.C. § 1961 does not
concern prejudgment interest, the Eighth Circuit has concluded that § 1961 provides the
proper measure for determining rates of both prejudgment and postjudgment interest.
Mansker, 54 F.3d at 1331. The annual yields on those treasury securities since May 2013
to the present have fluctuated from a low of .11% in May 2013, to a high of .21% when the
Court’s Order was entered on December 10, 2014. When the annual yields are averaged,
the resulting rate is .16%. When compounded annually, this rate provides a return of
Accordingly, Plaintiffs are entitled to recover an interest rate of .16% compounded
annually from May 23, 2013, which equals $15.83.
The Court now turns to Plaintiffs’ Bill of Costs under 28 U.S.C. § 1920. In its Bill of
Costs, Plaintiffs seek reimbursement in the total amount of $3,435.45 for the following
expenses it states were necessarily incurred in the defense of this action: $29.80 for fees
incurred in the service of summons and subpoenas; $3,015.73 for costs of printed or
The Court arrives at this amount by making the following calculations: 0.0016/365= daily
rate; daily rate x $6375.76 = daily interest; daily interest x 365 days (date from May 23,
2013 through May 23, 2014) = $10.62; $6375.76 + 10.20 = $6385.96 for the first year plus
interest. Next the Court makes the following calculations to determine the remaining
interest: 0.0016/365 = daily rate; daily rate x $6385.96 = daily interest; daily interest x 201
days (date from May 23, 2014 through December 10, 2014)= $5.63. Total = $15.83.
electronically recorded transcripts of the depositions of Edwards and McMillian; $136.30
for witness fees; and $253.62 for costs of making copies of any materials necessarily
obtained for the case.
Schilli disputes that Plaintiffs are entitled to costs, denying that Plaintiffs are the
prevailing party, as Plaintiffs received less than half of what they requested at the trial of
this matter, and Schilli prevailed as to state law claims on summary judgment. Schilli
further argues that the “bulk of costs Plaintiffs request are comprised of costs associated
with creating and procuring videotapes and written transcripts of depositions. . . .” (Doc. 52,
p.3). Specifically, Schilli objects to: (1) the deposition video and transcripts of Edwards;
(2) the deposition video of McMillian; and (3) meeting room rental fees for both depositions.
However, Schilli does not quarrel with the remaining items of costs sought in Plaintiffs' Bill
Under the Federal Rules of Civil Procedure, “[u]nless a federal statute, these rules,
or a court order provides otherwise, costs—other than attorney's fees—should be allowed
to the prevailing party.” Fed. R. Civ. P. 54(d)(1). The Eighth Circuit has held that Rule
54(d) codifies a rebuttable presumption that the prevailing party is entitled to costs.
Leonard v. Sw. Bell Corp. Disability Income Plan, 408 F.3d 528, 533 (8th Cir. 2005) (citing
Martin v. DaimlerChrysler Corp., 251 F.3d 691, 696 (8th Cir. 2001)). The costs available
under the rule are stated in 28 U.S.C. § 1920:
A judge or clerk of any court of the United States may tax as costs the
(1) Fees of the clerk and marshal;
(2) Fees for printed or electronically recorded transcripts necessarily
obtained for use in the case;
(3) Fees and disbursements for printing and witnesses;
(4) Fees for exemplification and the costs of making copies of any materials
where the copies are necessarily obtained for use in the case;
(5) Docket fees under section 1923 of this title;
(6) Compensations 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.
28 U.S.C. § 1920.
Not all expenses of litigation are costs taxable against the losing party, and within
the costs eligible to be taxed, the district court has discretion in determining and awarding
costs in a given case. Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 441–42
(1987); Pershern v. Fiatallis N. Am., Inc., 834 F.2d 136, 140 (8th Cir. 1987). The losing
party bears the burden of making the showing that an award is inequitable under the
circumstances. Concord Boat Corp. v. Brunswick Corp., 309 F.3d 494, 498 (8th Cir. 2002).
See also 168th and Dodge, LP v. Rave Reviews Cinemas, LLC, 501 F.3d 945, 958 (8th
Cir. 2007) (finding that a prevailing party is presumptively entitled to recover all of its costs
and the losing party must suggest a rationale under which the district court's actions
constitute an abuse of discretion).
Regarding whether Plaintiffs are the prevailing party, the Supreme Court has held,
in the context of a civil rights action, that to be a prevailing party, the plaintiff must be able
to point to a resolution of the dispute which changes the legal relationship between itself
and the defendant.” Tex. State Teachers' Ass'n v. Garland Indep. Sch. Dist., 489 U.S. 782,
792 (1989). A “prevailing party” has also been defined as “[a] party in whose favor a
judgment is rendered, regardless of the amount of damages awarded.” Buckhannon Bd.
& Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 603 (2001).
Thus, Plaintiffs are clearly the prevailing party.
As to Schilli’s objections to deposition costs, the Eighth Circuit has held that the
costs of video depositions are included under § 1920. Craftsmen Limousine, Inc. v. Ford
Motor Co., 579 F.3d 894, 898 (8th Cir. 2009). Schilli argues that expenses of video taping
were an unnecessary addition to a stenographic deposition, indicating that the award of the
video-deposition costs was unreasonable or unnecessary. However, the video deposition
testimony was used at trial and alluded to by both parties, and the transcripts of the video
deposition were requested by the Court. Further, it is easier to assess the credibility of
witnesses through their manner and demeanor in the video deposition, rather than simply
a written transcript.
Regarding the room rental for the depositions, these costs were incurred by
necessity of the depositions themselves. Plaintiffs required a room in which to conduct
these out-of-town depositions. As a result, Plaintiffs will be awarded the costs regarding
the depositions of both Edwards and McMillian. However, the Court discovered that there
is a discrepancy in the cost billed on Edwards’ deposition transcript. Although Plaintiffs
were charged for 146 pages of the deposition transcript, the transcript only comprised 46
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