Gaines v. Techline Inc
MEMORANDUM ORDER denying 131 Motion for Bill of Costs. Signed by Magistrate Judge Joseph H L Perez-Montes on 11/16/2017. (crt,Tice, Y)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
KENNETH B. GAINES
CIVIL ACTION 1:13-CV-00576
MAGISTRATE JUDGE PEREZ-MONTES
Before the Court is a Motion to Review and Dismiss Costs filed by Plaintiff
Kenneth B. Gaines (“Gaines”) (Doc. 131). The Clerk of Court taxed costs submitted
by Defendant Techline, Inc. (“Techline”) against Gaines as the losing party in this
action (Doc. 130). Gaines’s motion (Doc. 131) is denied.
Gaines’s Motion to Review and Dismiss Costs
Gaines contends Techline’s Bill of Costs should be reduced or denied because
he lost his primary source of income when he was terminated from Techline, he was
laid off from his church as a clergyman because of poor health, and he has been unable
to obtain new employment (Doc. 131-2). Gaines contends he is in financial distress
and his unfortunate circumstances are serious enough to justify the Court’s exercise
of its discretion in dismissing or reducing the amount of costs to be awarded to
Defendants under Fed. R. Civ. P. rule 54(d)(1).
Defendants argue they are the prevailing party, this case has been pending
more than four years, and Gaines had a lot of time to evaluate whether he wanted to
continue to proceed and risk being assessed costs in the event he was the nonprevailing party (Doc. 134).
Law and Analysis
Rule 54(d) of the Federal Rules of Civil Procedure provides that “costs shall be
allowed as of course to the prevailing party unless the court otherwise directs.” The
trial court has broad discretionary powers in taxing costs, but its decision may be
overturned if it abuses that discretion. See Walters v. Roadway Exp., Inc., 557 F.2d
521, 526 (5th Cir. 1977) (citing Harrington v. Texaco, Inc., 339 F.2d 814 (5th Cir.
1964), cert. denied, 381 U.S. 915 (1965)); see also Schwarz v. Folloder, 767 F.2d 125,
131 (5th Cir. 1985). While the rule does not prevent a trial court from requiring a
prevailing party to bear its own costs, “the language of the rule reasonably bears the
intendment that the prevailing party is prima facie entitled to costs and it is
incumbent on the losing party to overcome that presumption . . . (since) denial of costs
. . . is in the nature of a penalty for some defection on his part in the course of the
litigation.” See Walters, 557 F.2d at 526 (citing Popeil Brothers v. Schick Electric,
Inc., 516 F.2d 772, 775 (7th Cir. 1975)). Accordingly, when a trial court exacts such
a penalty, it should state reasons for its decision. See Walters, 622 F.2d at 166
(prevailing defendant was taxed with come costs where court had the “distinct
impression” that the cost of compiling the information was inflated by defendant's
lack of diligence, and plaintiffs' cost of litigation was increased by the time and effort
expended in this matter).
The losing party’s good faith is alone insufficient to justify the denial of costs
to the prevailing party. See Pacheco v. Mineta, 448 F.3d 783, 795 (5th Cir. 2006),
cert. den., 549 U.S. 888 (2006); see also Wade v. Peterson, 416 Fed. Appx. 354, 356
(5th Cir. 2011), cert. den., 565 U.S. 987 (2011). In the Fifth Circuit, courts may, but
are not required to, excuse a losing party from paying costs only if he brought suit in
good faith and can demonstrate at least one additional factor, such as:
(1) the losing party's limited financial resources;
(2) misconduct by the prevailing party;
(3) close and difficult legal issues presented;
(4) substantial benefit conferred to the public;
(5) the prevailing party's enormous financial resources.
See Pacheco, 448 F.3d at 794.
The Fifth Circuit has also held that reducing or eliminating costs to the
prevailing party based on its wealth is impermissible as a matter of law. Moore, 735
F.3d at 320 (“[t]he fact that the prevailing party is substantially more wealthy than
the losing party is not a sufficient ground for denying or limiting costs to the
prevailing party”); see also McKay v. Novartis Pharm. Corp., 2014 WL 12703992, *3
(W.D. Tex. 2014).
The question of what role “limited resources” play in reducing an award has
not been decided by the Fifth Circuit. Moore v. CITGO Ref. & Chemicals Co., L.P.,
735 F.3d 309, 320 (5th Cir. 2013). In Jurach v. Safety Vision, LLC, 2015 WL 893178,
at *2 (S.D. Tex. 2015), the court found there was a basis for reducing the cost award
based on Jurach's limited financial resources, the nature of the case, and her good
faith in filing it. But see King v. LaBelle, 2014 WL 6674091, at *2 (S.D. Tex. 2014)
(plaintiff's assertions as to his limited resources-not reaching the level of indigenceare not enough to justify disallowing costs to Defendants); see also Smith v.
Southeastern Pa. Transp. Authority, 47 F.3d 97, 99–100 (3d Cir.1995) (holding the
plaintiff's limited resources did not justify reducing the amount of the cost award,
when it did not exceed what plaintiff was able to pay).
Most circuits hold that a substantiated claim of the losing party's indigence
may justify a reduction of costs. See Moore, 735 F.3d at 320 n.9 (citing 10 James W.
Moore, Moore's Federal Practice § 54.101[b], at 54–157 (3d ed. 2013)). However,
the Fifth Circuit has noted that § 1915 “indicates that Congress intended for qualified
litigants to be able to proceed without advancing costs, but that they may be
ultimately liable for costs.” Washington v. Patlis, 916 F.2d 1036, 1039 (5th Cir. 1990);
see also Petri v. Kestrel Oil & Gas Props., L.P., 2013 WL 265973, at *7 (S.D. Tex.
2013) (holding “indigence is not a reason to permit a losing party to avoid costs”);
Trotta v. Cajun Conti LLC, 2017 WL 2840006, at *1 (E.D. La. 2017) (Trotta's limited
financial resources, in addition to proceeding in good faith, is not enough to defeat
Rule 54's presumption); Williams v. J.B. Hunt Transp., Inc., 2016 WL 4445442, at *4
(S.D. Tex. 2016) (plaintiff presented no evidence of his inability to pay other than his
self-serving statement that he has “limited resources,” which is insufficient to support
a claim of indigence); Hartnett v. Chase Bank of Texas Nat. Ass'n, 1999 WL 977757,
at *1 (N.D. Tex. 1999) (plaintiff’s tax returns suggested he had enough assets to pay
court costs); McKay, 2014 WL 12703992, *5 (court ordered each party to pay its own
costs and declined to award costs to defendant where plaintiffs acted in good faith
and had extremely limited resources, and the suit presented intricate legal issues
never before addressed directly to the Fifth Circuit).
In this case, although Gaines appears to have prosecuted in good faith, he has
not offered any evidence, other than self-serving statements in a brief, to support his
claim of indigence. 1 Therefore, Plaintiff has not carried his burden of showing he is
unable to pay the taxed court costs due to indigence. No other factor or circumstance
warrants Gaines’s requested relief.
IT IS ORDERED that Gaines’ unsupported Motion to Review and Dismiss
Costs (Doc. 131) is DENIED.
THUS DONE AND SIGNED in chambers in Alexandria, Louisiana, this _____
day of November, 2017.
Joseph H.L. Perez-Montes
United States Magistrate Judge
It noted that, although Defendant complains this case was been pending more than four years,
Defendant did not file its motion for summary judgment until the case had been pending for three
years. Although Defendant filed two motions to compel discovery, those motions were both filed and
resolved in 2014. Plaintiff’s first deposition was taken in September 2014, and the other three
depositions were taken in February 2016. It appears the length of time this case has been pending is
attributable, in part, to Defendant.
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