Thorncreek Apartments I, LLC et al v. Village of Park Forest et al

Filing 114

MEMORANDUM Opinion and Order Written by the Honorable Gary Feinerman on 6/11/2015.Mailed notice.(jlj, )

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
THORNCREEK APARTMENTS I, LLC,
THORNCREEK APARTMENTS II, LLC, and
THORNCREEK APARTMENTS III, LLC,
Plaintiffs,
vs.
VILLAGE OF PARK FOREST, an Illinois municipal
corporation, TOM MICK, in his individual capacity and as
Village Manager, MAE BRANDON, in her individual
capacity and as Village Trustee, BONITA DILLARD, in
her individual capacity and as Village Trustee, GARY
KOPYCINSKI, in his individual capacity and as Village
Trustee, KENNETH W. KRAMER, in his individual
capacity and as Village Trustee, ROBERT McCRAY, in
his individual capacity and as Village Trustee, GEORGIA
O’NEILL, in her individual capacity and as Village
Trustee, LAWRENCE KERESTES, in his individual
capacity and as Village Director of Community
Development, JOHN A. OSTENBURG, in his individual
capacity and as Mayor of the Village of Park Forest, and
SHEILA McGANN, in her capacity as Village Clerk,
Defendants.

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08 C 869
08 C 1225
08 C 4303
Judge Feinerman

MEMORANDUM OPINION AND ORDER
The history of these consolidated cases is set forth in the recent opinion resolving the
parties’ various post-trial motions. Doc. 435 (reported at 2015 WL 2444498 (N.D. Ill. May 20,
2015)). Familiarity with that opinion and its naming conventions is assumed, and, as before, all
docket entries are from Case 08 C 1255. Now before the court are the parties’ dueling bills of
costs under Federal Rule of Civil Procedure 54(d)(1) and 28 U.S.C. § 1920. Thorncreek seeks
$176,006.74 in costs from the Village of Park Forest, Tom Mick, and Lawrence Kerestes, the
three defendants found liable by the jury. Doc. 386. Defendants seek $177,003.60 in costs from
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Thorncreek. Doc. 387. For the following reasons, both bills of costs are overruled, and each
side shall bear its own costs.
Rule 54(d)(1) provides, in relevant part: “Unless 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). This Rule “creates a presumption in favor of awarding costs to
the prevailing party.” Myrick v. WellPoint, Inc., 764 F.3d 662, 666 (7th Cir. 2014). But like
most presumptions, this one can be overcome—particularly in so-called “mixed result” or
“mixed outcome” cases, where each side prevails in some respects and not others, and where the
district court has wide discretion to deny costs to both sides. See Gavoni v. Dobbs House, Inc.,
164 F.3d 1071, 1075 (7th Cir. 1999) (“courts have especially broad discretion to award or deny
costs in mixed result cases”); FASA Corp. v. Playmates Toys, Inc., 108 F.3d 140, 144 (7th Cir.
1997) (“costs … are normally awarded to the prevailing party as a matter of course, unless
exceptional circumstances are present … or unless the case has a mixed outcome”); Testa v. Vill.
of Mundelein, 89 F.3d 443, 447 (7th Cir. 1996) (“Considering the mixed outcome of the civil
rights and malicious prosecution claims, the decision requiring each party to bear its own costs is
within [the district court’s] discretion.”); Estate of Hevia v. Portrio Corp., 602 F.3d 34, 46 (1st
Cir. 2010) (“In situations in which one party prevails on some claims and the other party prevails
on other claims, the litigants are commonly ordered to bear their own costs.”); Amarel v.
Connell, 102 F.3d 1494, 1523 (9th Cir. 1996) (“In the event of a mixed judgment, however, it is
within the discretion of a district court to require each party to bear its own costs.”); see also
Exxon Valdez v. Exxon Mobil, 568 F.3d 1077, 1081 (9th Cir. 2009) (“In this case, neither side is
the clear winner. The defendant owes the plaintiffs $507.5 million in punitives—according to
counsel at oral argument the fourth largest punitive damages award ever granted. Yet that award
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represents a reduction by 90% of the original $5 billion. In light of this mixed result, and
mindful that the equities in this case fall squarely in favor of the plaintiffs—the victims of
Exxon’s malfeasance—we exercise our discretion by requiring each party to bear its own costs.”)
(applying Fed. R. App. P. 39(a)(4)).
Thorncreek lost several of its claims at summary judgment: its state and federal due
process and takings claims in their entirety; its claims against the individual defendants in their
official capacities; its Illinois Civil Rights Act (“ICRA”) claim against the individual defendants
in their personal capacities; and its claims against Sheila McGann. 970 F. Supp. 2d 828, 845-49
(N.D. Ill. 2013). At trial, Thorncreek lost outright on all of its claims against seven of the ten
remaining defendants; lost outright on its equal protection/race, 42 U.S.C. § 1986, and ICRA
claims; and prevailed against the three other defendants on only its equal protection/class-of-one
claim (against the Village and Mick) and its 42 U.S.C. § 1985(3) claim (against Mick and
Kerestes), obtaining $2,014,002.00 in compensatory and nominal damages and $6,000.00 in
punitive damages. Doc. 372. The court’s ruling on the post-trial motions eliminated
Thorncreek’s victory on the § 1985(3) claim, vacated $1,000.00 of the punitive damage award
(the portion attributable to Kerestes, who was no longer liable on any claim), entered judgment
for Kerestes, denied Thorncreek’s motion for a new trial on damages, and awarded Thorncreek
$501,032.88 in prejudgment interest. 2015 WL 2444498, at *11.
When all was said and done, Thorncreek prevailed on just one of several claims against
just two of the eleven defendants, and received just over $2 million in compensatory damages,
plus prejudgment interest, and $5000.00 in punitive damages; Thorncreek had asked the jury for
about ten times as much in compensatory damages and over one hundred times as much in
punitive damages, and felt so strongly that the compensatory damage award was insufficient that
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it moved for a new trial on damages. Nine of the eleven defendants prevailed across the board
against Thorncreek. All of the plaintiffs (recall that each of these three suits involves different
Thorncreek entities) share materially identical interests and can be considered one “side,” and the
same can be said for the eleven defendants (the Village and ten of its officials, who jointly filed
briefs and other pleadings throughout the case and who jointly examined the witnesses and
delivered closing arguments at trial). As explained below, the outcome certainly qualifies as a
“mixed result” within the meaning of the mixed result cases.
Thorncreek and Defendants each assert that they and they alone are the prevailing parties
under Rule 54(d)(1). Doc. 395 at 4 (“After viewing the verdict as a whole, Defendants are the
prevailing parties”); Doc. 399 at 8 (“The Plaintiffs have prevailed on the most significant and
central issues in their case.”). “A party prevails for purposes of Rule 54(d) when a final
judgment awards it substantial relief.” Smart v. Local 702 IBEW, 573 F.3d 523, 525 (7th Cir.
2009). Although its success was limited, Thorncreek is a Rule 54(d)(1) prevailing party against
Mick and the Village; $2 million is a substantial sum, and punitive damages in any amount are a
substantial rebuke. See Slane v. Mariah Boats, Inc., 164 F.3d 1065, 1068 (7th Cir. 1999)
(affirming the district court’s award of costs to the plaintiff, reasoning: “Mariah argues that the
court erred in awarding costs to Slane because Slane did not ‘prevail’ in the suit; rather, Slane
won two claims and Mariah won two. The district court correctly noted that when one party gets
substantial relief it ‘prevails’ even if it doesn’t win on every claim. Slane got $225,000 from the
jury. By any definition, he won the battle. The court’s conclusion that Slane prevailed was more
than reasonable.”) (citation omitted). At the same time, the nine other defendants prevailed
against Thorncreek, which makes them Rule 54(d)(1) prevailing parties.

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Where a plaintiff prevails against some defendants but loses against others, one option is
to tax the plaintiff’s costs to the losing defendants and the winning defendants’ costs to the
plaintiff. See Perlman v. Zell, 185 F.3d 850, 858-59 (7th Cir. 1999) (stating that, although the
court “cannot say that an award of costs in [plaintiff’s] favor is forbidden,” “[f]ive defendants
have prevailed outright … [and] are entitled to recover their own costs of defense” from the
plaintiff). A simpler option is for the parties to bear their own respective costs, and that is the
better option where, as here, it is impossible to disentangle and allocate the costs expended by
either side as between the prevailing and non-prevailing defendants.
The point is illustrated by Israel Travel Advisory Services, Inc. v. Israel Identity Tours,
Inc., 61 F.3d 1250 (7th Cir. 1995), which affirmed the district court’s ordering the parties to bear
their own costs where the plaintiff “prevailed …, but only in part.” Id. at 1261. The Israel
Travel plaintiff succeeded against one defendant, but it “lost outright” against another and lost to
a third “in advance of trial.” Ibid. In addition, the plaintiff “peppered the judge with woebegone
theories … [which] took up time and [the defendant’s] money without producing anything in
return.” Ibid. “Under the circumstances,” the Seventh Circuit reasoned, “declining to shift costs
was a wise decision.” Ibid. Similarly, in Testa v. Village of Mundelein, supra, the plaintiff sued
several Mundelein police offers for unlawful arrest and the Village of Mundelein for malicious
prosecution. The plaintiff succeeded only on the malicious prosecution claim. 89 F.3d at 444.
The district court opted to “exercise its discretion to decline to award costs to either side.” Testa
v. Vill. of Mundelein, 1995 WL 383181, at *9 (N.D. Ill. June 23, 1995). The Seventh Circuit
affirmed, explaining that “[d]istrict courts enjoy wide discretion in determining and awarding
reasonable costs,” and that “[c]onsidering the mixed outcome” at trial, “the decision requiring
each party to bear its own costs is within that discretion.” Testa, 89 F.3d at 447.
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The same outcome is appropriate here. Thorncreek lost outright against most of the
defendants, and its many unsuccessful claims—not simply the theories on which it was
completely shut out, like takings, due process, conspiracy, and race discrimination, but also on
the class-of-one theory that it pursued unsuccessfully against nine of the eleven defendants—
took up a significant amount of time and money without producing anything in return. And even
Thorncreek’s success against the Village and Mick brought it only a tenth of what it sought from
the jury. Given these mixed results, the court chooses to exercise its discretion to order each side
to bear its own costs. See Landau & Cleary, Ltd. v. Hribar Trucking, Inc., 807 F.2d 91, 94 (7th
Cir. 1986) (“In light of the fact that both parties prevailed on one or another of the claims, it was
within the district court’s sound discretion not to award [the plaintiff] costs.”); Wells v. City of
Chicago, 925 F. Supp. 2d 1036, 1050 (N.D. Ill. 2013) (denying costs to both sides where the
plaintiff prevailed on only one set of claims against only some of the defendants); Gonzalez v.
City of Elgin, 2010 WL 4636638, at *2 (N.D. Ill. Nov. 8, 2010) (denying costs to both parties
where the plaintiffs prevailed against two individual defendants and the city but lost against four
other individual defendants).
The analysis could stop here, but it bears mention that each side seeks almost exactly the
same amount of costs from the other. Cf. Testa, 1995 WL 383181, at *9 (“Rather than make the
parties pay each other’s costs, with the net effect of requiring Mr. Testa to pay Defendants some
$300, the court will exercise its discretion to decline to award costs to either side.”). To be sure,
each side makes extensive objections to the other’s bill, threatening to undo the symmetry.
Indeed, Defendants concede that $128,000 of their requested costs cannot be recovered. Doc.
394 at 6-7 (objecting to Defendants’ request to recover for their forensic accountant’s expert
witness fees); Doc. 400 at 4-5 (withdrawing the request). Still, the ledgers ultimately could have
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balanced. Thorncreek contends that 28 U.S.C. § 1920(4), which allows the court to tax “[f]ees
for exemplification and the costs of copies … necessarily obtained for use in the case,” covers
the $129,000 it expended to produce and store certain electronically stored information (“ESI”).
Doc. 399 at 18-21. Citing Johnson v. Allstate Insurance Co., 2012 WL 4936598 (S.D. Ill. Oct.
16, 2012), and other decisions, Defendants disagree. Doc. 395 at 10-15. As another judge
recently observed, the Seventh Circuit “has not yet provided guidance as to which services
related to the production of electronically stored information … are taxable under the statute.”
Chi. Bd. Option Exch., Inc. v. Int’l Sec. Exch., LLC, 2014 WL 125937, at *8 (N.D. Ill. Jan. 14,
2014). And even if some ESI costs were compensable in theory, Thorncreek has not itemized
those costs. Doc. 386-1 at 3; Doc. 386-8 (copies of invoices). Absent additional detail, it would
be difficult to determine what portion of Thorncreek’s ESI costs, if any, were necessarily
incurred. See Cefalu v. Vill. of Elk Grove, 211 F.3d 416, 428 (7th Cir. 2000) (“even when a
particular item qualifies as exemplification, a court must still determine whether it was
‘necessarily obtained for use in the case’”). There is no reason to run to ground these or any
other specific objections to the bills of costs, for no matter how closely the bills might offset, the
mixed result makes it appropriate for each side to bear its own costs. See Wells, 925 F. Supp. 2d
at 1050 (“Because the Court is denying both sides’ bills of costs, it need not and does not
adjudicate each side’s objections to particular items within the opposing side’s bill of costs.”).
One loose end remains. Consistent with the jury’s verdict, the judgment imposed
punitive damages “in favor of Plaintiffs and against Defendant Tom Mick in the amount of
$5,000.00.” Doc. 370 at 1. In its reply brief on costs, Thorncreek asks the court “clarify”
whether, in light of the verdict form and jury instructions, the judgment should have required
Mick to make three $5,000 payments, one to each of the Thorncreek entities. Doc. 399 at 6 n.1.
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If Thorncreek believed that the judgment entered by the court did not properly implement the
jury’s verdict, it should have raised the issue in one of its two post-trial motions, not in a footnote
in its reply brief on costs. In any event, no clarification is necessary. The verdict form
“award[ed] punitive damages” against Mick in the amount of $5,000, not $15,000. Doc. 372 at
9. And the instructions told the jury it could “assess punitive damages against [a] Defendant”
and to “set[] the amount of those damages” in light of several factors. Doc. 368 at 40 (emphasis
added). Nowhere did the instructions suggest that whatever amount the jury settled on would be
awarded in triplicate to each of the Thorncreek entities.
For the foregoing reasons, both sides’ requests for § 1920 costs under Rule 54(d)(1) are
denied. This disposition will not, in itself, control the disposition of any motion for attorney fees
and expenses that Thorncreek plans to file under 42 U.S.C. § 1988. See Family PAC v.
Ferguson, 745 F.3d 1261, 1268 (9th Cir. 2014) (“Under longstanding circuit practice, we will
sometimes direct the parties to pay their own costs when, as here, there is a mixed judgment. In
the case of the same mixed result, however, the partially prevailing plaintiff may well be entitled
to an award of attorney’s fees under § 1988 because plaintiffs may be considered prevailing
parties for attorney’s fees purposes if they succeed on any significant issue in litigation which
achieves some of the benefit the parties sought in bringing suit.”) (internal quotation marks and
citations omitted); Wells, 925 F. Supp. 2d at 1050 (“The determination to deny both sides’ bill of
costs [due to the case being a “mixed result” case] has no bearing on plaintiff’s right to recover
under 42 U.S.C. § 1988 ….”).

June 11, 2015
United States District Judge
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