US Fidelity v. Lee Investments LLC, et al, No. 1:1999cv05583 - Document 926 (E.D. Cal. 2010)
Court Description: MEMORANDUM DECISION and ORDER Granting in Part and Denying in Part USF&G's Bill of Costs 896 , signed by Judge Oliver W. Wanger on 8/2/2010. (Gaumnitz, R)
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US Fidelity v. Lee Investments LLC, et al Doc. 926 1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT FOR THE 7 EASTERN DISTRICT OF CALIFORNIA 8 17 ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) 18 United States Fidelity & Guaranty Company, American 9 UNITED STATES FIDELITY & GUARANTY COMPANY, 10 11 Plaintiff, 12 vs. 13 14 LEE INVESTMENTS LLC dba THE ISLAND, et al., 15 Defendants. 16 No. CV-F-99-5583 OWW/SMS MEMORANDUM DECISION AND ORDER GRANTING IN PART AND DENYING IN PART USF&G'S BILL OF COSTS (Doc. 896) 19 Specialty Insurance Services, Inc., and American Specialty Risk 20 Management, LLC (collectively USF&G ) have filed a Bill of 21 Costs, seeking to recover the following costs from Lee 22 Investments, LLC ( Lee ):1 23 Fees of the Clerk Fees for service of summons $150.00 24 25 26 1 USF&G submitted a bill of costs on March 12, 2007 (Docs. 712716). The bill of costs submitted on August 14, 2009 (Doc. 896), supercedes the earlier bill of costs. 1 Dockets.Justia.com 1 and subpoena 2 Fees of the court reporter for all or any part of the transcript necessarily obtained for use in the case $35,514.80 Fees for witnesses $11,546.79 Fees for exemplification and copies of papers necessarily obtained for use in the case $31,842.09 3 $7,977.22 4 5 6 7 8 Docket fees under 28 U.S.C. 1923 $20.00 9 10 Other costs $14,335.50 $101,386.40 11 12 Lee has filed objections to the Bill of Costs, asserting 13 that it should be reduced by $64,986.64, resulting in a total 14 cost bill of $36,399.76. 15 A. 16 Lee objects to these costs on a number of grounds. 17 18 Fees for Service of Summons and Subpoena. 1. Deposition Subpoenas. Lee objects to taxing the full costs of deposition subpoenas 19 in this action. 20 should be reduced by half, to $903.25. 21 objection, Lee relies on the Declaration of Daniel O. Jamison: 22 23 24 25 26 Lee contends that the full amount, $1806.50, In support of this 2. I have been the lead attorney for Lee in the above captioned matter since approximately February 2006 and was the lead attorney for Lee in the January/February 2007 jury trial and the April 2007 court trial in this case. Since spring 2006, I have also represented Lee as lead counsel in the defense of the claim of ... USF&G ... in California Workers Compensation Appeals 2 Board ( WCAB ) Case No. SB 0288749, entitled Conley v. The Island, et al., that USF&G is entitled to rescind the workers compensation insurance policy that has been the subject of the above captioned action. 1 2 3 3. Since becoming involved in these two matters, I have read most, if not all, of the depositions that were taken in the two cases before I became involved. On the record in several of the depositions, there were stipulations between Lee and USF&G that the deposition would be taken jointly in the two proceedings and could be used in both proceedings. Although USF&G may dispute the application of the stipulation to expert witness depositions, it is and was my understanding that by stipulation and/or notice all of the depositions taken in this action were being taken in both proceedings. 4 5 6 7 8 9 10 11 17 4. USF&G s claim for rescission in WCAB Case No. SB 0288749 has not yet been adjudicated before the WCAB. There has been no determination in the WCAB proceeding whether or not USF&G is entitled to rescind the subject insurance policy and no prevailing party has been determined in that proceeding. At the present time, the above captioned court has issued an injunction preventing Lee from seeking to have the WCAB make a determination whether or not USF&G is entitled to rescind the subject policy. 18 Exhibit A to Mr. Jamison s Declaration are partial copies of the 19 depositions of Richard Miler, Elaine Bartsch, and Stan Sheehan. 20 The Miler and Bartsch depositions were taken in the Federal 21 action. 12 13 14 15 16 22 23 24 25 26 The Miler deposition states: MR. SMYTH: [¶] Let s put a stipulation on the record. This is going to be used in both potentially used in the Workers Compensation and the Federal action, but we ll stipulate that the court reporter is relieved of her obligations under the California Code of Civil Procedure with respect to the Workers Compensation portion; that the witness can sign the deposition under penalty of perjury 3 and that if he doesn t sign it within 30 days of having received it for his signature, that a certified copy may be used with the same force and effect as a signed original. 1 2 3 The same stipulation was entered into in the Bartsch deposition. 4 In the Sheehan deposition, the following stipulation was entered 5 into: 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 MR SMYTH: Okay, while we were off the record, we discussed the fact that this deposition had been noticed only in the workers compensation action. We, among the stipulations that I ll propose here ... is that the deposition may be used and should have a duplicate cover page for not only the workers compensation action, but the federal court action. And that the deposition may be used in ... both the federal court and the workers compensation action. We additionally propose ... for stipulation that the witness may have 30 days after receipt of the transcript to make any changes as are appropriate and to sign the transcript. And that if a signed copy is not received and copies to the changes provided to counsel and the signature page within 30 days, that a certified copy may be used in all proceedings in these two matters with the same force and effect as a ... signed original. This deposition is being taken in connection with a case pending in the federal court in California and in a California workers compensation action. To the extent that there s a stipulation required that the - in the event that the deponent does not sign the document in the presence of the court reporter, the parties stipulate that that requirement has been relieved and the deponent may sign the document under penalty of perjury. The parties so stipulated. Citing Parkerson v. Borst, 256 F. 827 (5th Cir.1919), for 25 the proposition that [u]ntil final judgment, the incidence of 26 costs is not determinable, Lee argues that, because there has 4 1 been no final determination in the WCAB case, the costs of the 2 depositions should be split between this action and the WCAB 3 case. 4 USF&G responds that Lee s contention that these costs should 5 be halved because the parties agreed that the depositions would 6 be admissible in the WCAB proceeding is without merit: 7 8 9 Such costs were incurred in the District Court action. More importantly, the judgment of the District Court under which costs were awarded constitutes a final judgment resolving USF&G s complaint in all forums and is res judicata. 10 By Memorandum Decision filed on December 2, 2008, (Doc. 11 864), and by Order filed on December 19, 2008, (Doc.872), the 12 Court ruled that Lee was precluded by res judicata from 13 proceeding with the WCAB action. While this ruling is on appeal 14 to the Ninth Circuit, it nonetheless remains that there is a 15 final Judgment pursuant to Rule 54(b), Federal Rules of Civil 16 Procedure, in this action. Lee s contention that the costs of 17 the deposition subpoenas should be halved because of the 18 possibility that the Ninth Circuit will reverse this Court s 19 rulings has no basis in law. The requested deposition costs are 20 allowed as all three depositions were used in the federal case. 21 2. Witness Subpoenas. 22 Lee argues that the cost of witness subpoenas for those 23 witnesses who did not testify at trial should be disallowed, 24 seeking a reduction of $934.56. Specifically, Lee objects to the 25 following costs: 26 5 1 2 Date Invoice Vendor Description Amount 3 1/27/07 1621 SoCal Trial Subpoena Attempt to serve Richard Miler 110.00 1/26/07 1620 SoCal Trial Subpoena Subpoena of Dawn Wilson 65.63 SoCal Trial Subpoena Subpoena of Richard Miler & Witness Fee 448.93 4 5 6 7 2/2/07 8 9 2/07/07 1662 SoCal Trial Subpoena Subpoena of Nathan Hoagland 100.00 2/11/07 1717 SoCal Trial Subpoena Attempt to serve Mark Stewart 100.00 3/2/07 1718 SoCal Trial Subpoena Attempt to serve Steve Chadwick 110.00 10 11 12 13 14 15 In order to award costs for service of subpoenas, the court 16 need only determine whether the subpoenas were reasonable and 17 necessary in light of the facts known at the time of service. 18 Movitz v. First National Bank of Chicago, 982 F.Supp. 571, 574 19 (N.D.Ill.1997), citing Shea v. Galaxie Lumber & Constr. Co., 1997 20 WL 51655 at *8 (N.D.Ill., Feb. 5, 1997)(costs of service of 21 subpoenas are recoverable even if the witnesses do not testify 22 at trial; the relevant question is whether the plaintiff 23 reasonably believed ... that the testimony would be helpful. ) 24 USF&G argues that these costs are recoverable, relying on he 25 Declaration of Bruce T. Smyth, counsel for USF&G: 26 6 3. Three of the witnesses who are the subject of Lee s request for reduction for costs for subpoenas for witnesses who did not testify, Nathan Hoagland, Mark Stewart and Steve Chadwick, were current or former Lee employees who did not testify because they could not be located by the process server. Since they were performing construction work for Lee at the time of the injury to Diana Conley, if we had located them, they would have testified at trial. The other witness, Richard Miler, a former Lee employee, would have been called to testify except that the testimony of another Lee witness, Lisa Ehrlich, covered the same topics. Miler also could have been called as a witness dependent on the testimony introduced in Lee s case for its defense or counterclaims. 1 2 3 4 5 6 7 8 9 10 Fees for service of potential trial witness subpoenas are 11 not made inadmissible if the witness is not called to testify if 12 it was necessary that the witness be available to give relevant 13 testimony. USF&G makes no showing that Miler s testimony was not 14 cumulative. Miler s witness and subpoena fees are disallowed. 15 USF&G has demonstrated that the fees of the other challenged 16 witnesses were necessary. 17 USF&G is allowed costs of $7,418.29. 18 B. Fees of Court Reporter. 19 1. Motion and Trial Transcripts. 20 Lee seeks disallowance of $11,269.35 of the $35,514.80 of 21 costs of the court reporters, which pertain to daily trial 22 transcripts and motion hearing transcripts. Lee notes that USF&G 23 did not obtain prior court approval for these transcripts and did 24 not obtain Lee s agreement that some or all of the costs of daily 25 26 7 1 transcripts would be a recoverable cost by the prevailing party.2 2 Lee seeks disallowance of the following costs: 3 Invoice Vendor Description Amount 4/29/02 17738 VARS COD for transcript of hearing on motion to compel discovery 286.00 5/1/02 4 Date 51 Shavavian Crump Transcript of hearing 57.00 5/20/02 990462 Robert R. Molezzo Transcript of motion to dismiss amended complaint 68.00 1/2/07 2814 Petrilla Reporting Hearing transcript 441.60 1/04/07 31290 Karen Lopez Hearing transcript 11/20/06 489.50 1/17/07 20070013 Karen Lopez Hearing transcript 17.97 1/19/07 31290 Peggy Crawford Hearing transcript 764.50 1/19/07 31290 Karen Lopez Motions in limine hearing transcript 1,034.36 Peggy Crawford Trial transcript 501.62 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 2/7/07 21 22 2 23 24 25 26 Although Lee notes that the Eastern District of California s Local Rules of Practice do not require prior Court approval for a daily transcript, Lee refers to the local rules for the Northern and Central Districts of California and the District of Arizona, which provide that the cost of daily transcripts are not regularly taxable without prior court approval or stipulation by the parties. The local rules of other jurisdictions have no application or relevance in the Eastern District of California. 8 1 2/13/07 Peggy Crawford Trial transcript 637.40 2/16/07 Peggy Crawford Trial transcript 46.20 2/16/07 Karen Lopez Trial transcript 222.44 2/21/07 Peggy Crawford Trial transcript 110.00 2/21/07 Karen Lopez Trial transcript 96.80 2 3 4 5 6 7 8 3/26/07 20070047 Karen Lopez Hearing transcript 27.39 3/26/07 03232007C Peggy Crawford Hearing transcript 47.31 11 4/1/07 04012007A Peggy Crawford Trial transcript 62.50 12 4/4/07 041122007A Peggy Crawford Trial transcript 1,949.20 5/31/07 53107 Peggy Crawford Trial transcript 2,522.64 6/1/07 20070085 Karen Lopez Trial transcript 1,840.92 11/5/08 3333 Petrilla Reporting Hearing transcript 45.80 9 10 13 14 15 16 17 18 28 U.S.C. § 1920(2) allows taxation of [f]ees for printed 19 or electronically recorded transcripts necessarily obtained for 20 use in the case. 21 Practice and Procedure: Civil 3d § 3677, pp. 438-440: 22 23 24 25 26 As explained in Wright, Miller & Kane, Federal The basic standard applied by the courts in determining whether to allow the expense of a transcript as a taxable cost is whether the transcript was necessarily obtained for use in the case. This does not mean that the transcript must have been indispensable to the litigation to satisfy this test; it simply must have been necessary to counsel s effective performance or the 9 1 2 3 4 5 court s handling of the case. The transcript may have been procured either for use at the trial or after the trial. But the words use in the case in Section 1920 mean that the transcript must have a direct relationship to the determination and result of the trial. Taxation will not be allowed if the transcript was procured primarily for counsel s convenience. 6 As a general rule, daily trial transcript costs should not 7 be awarded absent court approval prior to the trial ... However, 8 a District Court may overlook the lack of prior approval if the 9 case is complex and the transcripts proved invaluable to both the 10 counsel and the court. 11 Inc., 76 F.3d 1178, 1184 (Fed.Cir.1996); see also Maris 12 Distributing Co. v. Anheuser-Busch, Inc., 302 F.3d 1207, 1226 13 (11th Cir.2002), cert. denied, 537 U.S. 1190 (2003): 14 15 16 17 18 Manildra Mill. Corp. v. Ogilvie Mills, Although we do not believe that the costs associated with expedited trial transcripts should be allowed as a matter of course, lest litigation costs be unnecessarily increased, the district court found that expedited transcripts were necessary in this case given its length and complexity. Under the circumstances, we cannot say that the district court clearly abused its discretion by reaching this conclusion. 19 But see Battenfield of America Holding Co., Inc. v. Baird, 196 20 F.R.D. 613, 618 (D.Kan.2000): 21 22 23 24 25 26 While the court expresses no opinion as to whether daily copy was necessary for counsel at trial, the court is in the best position to assess the value of the daily copy to it ... Suffice it to say, daily copy was not necessary for the court s handling of the case ... The court cannot recall any occasions in which it even looked to daily copy for guidance in analyzing an evidentiary issue. While daily copy may have aided the 10 4 parties in resolving various disputes amongst themselves, the court is fairly confident that it could have resolved those issues for the parties in the absence of daily copy. In short, this case was neither so complex nor so lengthy as to justify imposing such special costs on BKD. 5 In arguing that the challenged costs should be allowed, 1 2 3 6 7 8 9 USF&G relies on Mr. Smyth s Declaration: 4. The trial and hearing transcripts referenced in Exhibit 3 to the cost bill were utilized for motions to the Court prior to and during trial and for preparation for motions for judgment and closing argument .... 10 11 12 13 14 15 16 17 18 5. Most of the trial transcript costs to which Lee objects included only selected portions of testimony utilized for trial or specific hearings necessary for preparation of motions before the Court. The first challenged hearing transcript, for April 29, 2002, was the transcript of the hearing before Magistrate Judge Snyder on motions by USF&G to compel further responses by Lee to interrogatories. The transcript of the hearing was necessary to understand the scope of the Court s rulings. The next challenged transcript, for May 1, 2002, was for the hearing on the motions for summary judgment. The transcript obtained for May 20, 2002, concerned the 2000 motion by USF&G to dismiss the amended counterclaim. 19 20 21 22 23 24 25 26 6. The next series of transcripts which Lee challenges, dated January 2, 4, 17 and 19, 2007, are for transcripts of the hearings before the Court on November 13 and 20, 2006 and on the hearings on the motions in limine on January 17 and 18, 2007. Those transcripts were necessary to understand the Court s rulings on key issues concerning the pretrial proceedings, and in particular, on the motions in limine. Indeed, the parties agreed to split the costs of the transcript of the hearing on motions in limine three separate ways, in order to prepare orders on the motions and to understand the scope of 11 1 2 the Court s rulings in order to instruct witnesses as to the scope of their testimony and to conduct examination and crossexamination. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 7. The next series of transcripts which Lee challenges all involve portions of relevant testimony and statements in the case, invoices dated February 1, 13, 16, 21, and March 26 and April 1, 2007. All of those invoices were provided for extremely limited portions of the trial or testimony, such as opening statements, the hearings on the Rule 50 motions and copies of specific testimony. In most cases, the invoices were for copies of testimony ordered by other parties, Lee or Aon. All of these costs were necessarily incurred in the trial. In the case of copies of transcripts ordered by other parties, the copies were necessary to prepare responses to the issues likely raised by other parties in the testimony. For example, if other parties intended to raise issues before the Court based on the trial testimony, USF&G required its own copy to verify the correctness and immediate context of the testimony cited. Portions of the opening statements and transcripts of the testimony of Lee s key witness, Lisa Ehrlich, were needed for preparation of closing argument and crossexamination. 8. The April 7, 2007 invoice, for a copy of the transcript of the April 4-6 trial, was necessary for the preparation of proposed Findings of Fact and Conclusions of Law for submission to the Court. 25 9. The charges in invoices for May 31, 2007 and June 1, 2007, were for USF&G s copies of the transcripts of the entire trial obtained by Lee in connection with its appeal. Although such copies would be needed in the appeal, USF&G obtained the copies in response to any portions of those transcripts which might be referenced by Lee in any future trial of other trial phases, although the other phase issues were subsequently resolved by summary judgment. 26 10. 20 21 22 23 24 The invoice dated November 5, 2008 was 12 for USF&G s copy of the hearing on its motion for summary judgment on the remaining of Lee s claims in its counterclaim and that of the Rexford Parties (as well as of the motion for injunction) and were needed in case of a challenge to the Court s rulings. 1 2 3 4 Based on the standards set forth above, the transcripts for 5 April 29, 2002, May 1, 2002, May 20, 2002, and November 5, 2008, 6 were not necessarily obtained for use in the case. All of these 7 transcripts were hearings on motions that were subsequently 8 resolved by Court orders and USF&G provides no valid reasons why 9 the transcripts were necessary after the motions were taken under 10 submission. These costs, totaling $458.80, are disallowed. 11 The transcripts of the hearings on the motions in limine and 12 the partial transcripts of the jury trial and the court trial 13 were necessarily obtained for use in the case. The motions in 14 limine were voluminous and complex and counsel was required to 15 submit proposed orders based on the Court s oral rulings. Both 16 the jury trial and the Court trial involved complicated issues 17 and, as to the Court trial, the transcript was necessary to 18 prepare Findings of Fact and Conclusions of Law. 19 However, the cost of the entire trial transcript described 20 in paragraph 9 of Mr. Smyth s declaration has not been shown to 21 have been necessarily obtained for use in the case because the 22 remaining issues in the case were resolved by summary judgment 23 motions. Mr. Smyth s declaration makes clear that these costs 24 were incurred on the possibility that reference to them might 25 become necessary. These costs, totaling $4,363.56, are 26 13 1 disallowed. 2. 2 Lee objects to the $24,245.80 in costs for deposition 3 4 Deposition Transcripts. transcripts. Lee argues that only half of these costs should be taxed 5 6 because of the stipulation that the depositions could be used in 7 both the Federal action and the WCAB action. For the reasons stated above, Lee s objection is without 8 9 merit. 10 Lee contends that $1,681.85 of these costs should be 11 disallowed because certain of the depositions were taken purely 12 for investigative purposes and not for trial preparation: 13 DATE INVOICE DESCRIPTION AMOUNT 14 9/29/00 85747 Mark Stewart 388.50 15 8/09/01 97523ELA Richard Miler 796.45 16 4/3/02 85312 Deborah Long 269.80 4/26/02 85615 D. Wilson 74.80 4/30/02 17738 Pamela Lilly 152.30 17 18 19 20 21 22 23 24 25 In response, USF&G relies on Mr. Smyth s Declaration: 11. Although Lee has asserted that costs of the transcripts of the depositions it challenges were not necessarily taken in preparation for trial, portions of the deposition testimony of Debra Long, Dawn Wilson and Richard Miler were designated for trial in the designation of transcripts filed with the Court by USF&G. Lee counterdesignated substantial portions of that testimony .... This averment is substantiated by Exhibit A to Mr. Smyth s 26 14 1 declaration. In addition, Mr. Smyth avers: 12. Although Lee complains that the costs of the transcripts ... were not prepared for trial, as to the depositions of Debra Long, Dawn Wilson and Pamela Lilly, those depositions were all noticed by Lee in this matter. 2 3 4 5 That Lee noticed the depositions of Debra Long and Pamela Lilly 6 is substantiated by Exhibit B to Mr. Smyth s Declaration. Mr. 7 Smyth further avers: 8 13. Although Lee objects to the costs of transcripts of Mark Stewart and Richard Miler, both were employed by Lee or affiliated entities. Mr. Stewart had responsibility for construction in the water park. We did not call him as a witness because we were unable to serve him with a subpoena and because we subsequently determined that his testimony would be duplicative of that of Bruce Calomires, who did testify. Mr. Miler was knowledgeable about the payment of water park construction expenses and of water park construction employees. USF&G was prepared to call him at trial and in fact had subpoenaed him for testimony, but determined that his testimony would be duplicative of that of Lisa Ehrlich after she testified. 9 10 11 12 13 14 15 16 17 18 Deposition transcripts are taxable as costs under 28 U.S.C. 19 § 1920(2). 20 depositions were taken for trial preparation. 21 disallowed. 22 23 24 25 26 Here, from the record, all of the challenged Lee s challenge is USF&G is awarded costs for fees of the court reporter in the amount of $30,692.44. C. Fees for Witnesses. 1. Directors or Officers of American Specialty. Lee objects to the taxation of fees for the following 15 1 witnesses on the ground that each is an officer or director of 2 American Specialty: 3 Amount Stan Sheehan (senior vice-president & chief underwriting officer 1,800.49 Dan Weir (chief financial officer) 4 Witness 1,362.38 Lowell Gratigny (senior vicepresident of litigation) 1,800.87 5 6 7 8 Parties are generally not able to recover witness fees for 9 their own trial attendance. Barber v. Ruth, 7 F.3d 636, 646 (th 10 Cir.1993). Lee contends that, where a party is a corporation, 11 generally its officers or directors are required to be present at 12 trial as the corporation s representative or to manage the 13 litigation. Citing Kemart Corporation v. Printing Arts Research 14 Lab., 232 F.2d 897, 901-902 (9th Cir.1956), Lee asserts that, if 15 such representatives are personally involved in the litigation, 16 the cost to attend the trial should not be recoverable. 17 In Kemart, the Ninth Circuit adopted the reasoning of 18 Perlman v. Feldmann, 116 F.Supp. 102, 115 (D.Conn.1953), which 19 allowed witness fees as costs for corporate officers: 20 25 No recovery [in the action to which they were called as witnesses] was sought from them individually; their interest was not shown to be other than the natural concern of an officer for the welfare of his corporation. The Clerk s ruling [allowing the fees] was amply supported by the cases which he cited ... Though these were admiralty cases the principle involved is equally applicable to the situation here. 26 See also El Dorado Irrigation Dist. v. Traylor Bros., Inc., 2007 21 22 23 24 16 1 WL 512428 at *9 (E.D.Cal., Feb. 12, 2007)( [I]t is proper for the 2 court to assess witness fees for directors and officers of a 3 corporate party who are not personally involved in the 4 litigation. ) 5 6 7 8 9 10 11 12 In response to Lee s objections, Mr. Smyth avers: 14. Although Lee seeks to exclude some of the costs of witnesses who were also officers of American Specialty, USF&G seeks recovery only for the costs where those witnesses testified or were made available for testimony. Both Dan Weir and Stan Sheehan testified during the trial. Although Lowell Gratigny attended large portions of the trial, the only expenses submitted are those for which he was available for testimony, after having been subpoenaed for his trial testimony by Lee. Although it was ultimately determined that he need not testify, Mr. Gratigny was available for testimony. 13 Here, none of these witnesses was personally involved in 14 this action; none were named as parties. Lee s objection is 15 without merit. 16 Although not raised by Lee in its objections to USF&G s bill 17 of costs, several of the witness fee costs sought by USF&G exceed 18 the amounts allowed by Section 1920(3) and 28 U.S.C. § 1821. 19 Stan Sheehan is listed on Exhibit 4 as attending the trial 20 for two days, incurring a total witness fee of $80.00. However, 21 Exhibit 4 seeks subsistence (hotel/meals) for seven days in the 22 amount of $1,133.49. The Minutes of the jury trial show that 23 Stan Sheehan testified in the jury trial on February 7, 2007 24 (Doc. 627). Exhibit 4 shows that Mr. Sheehan arrived in Fresno 25 on February 1, 2007 and departed on February 9, 2007. 26 17 USF&G is 1 entitled to the witness fee for the two days sought in the bill 2 of costs pursuant to 28 U.S.C. § 1821(b): 6 A witness shall be paid an attendance fee of $40 per day for each day s attendance. A witness shall also be paid the attendance fee for the time necessarily occupied in going to and returning from the place of attendance at the beginning and end of such attendance or at any time during such attendance. 7 Section 1821(d) provides for a subsistence allowance to a witness 8 when an overnight stay is required at the place of attendance 9 because such place is so far removed from the residence of such 3 4 5 10 witness as to prohibit return thereto from day to day in an 11 amount not to exceed the maximum per diem allowance prescribed by 12 the Administrator of General Services. 13 diem for Fresno, California was $79 for lodging and $54 for meals 14 and entertainment. 15 meals for Mr. Sheehan in the total amount of $266.00. 16 allowed costs of $1,013.00 for Mr. Sheehan s attendance at trial 17 as a witness, disallowing $876.00 of the $1,880.00 in costs 18 sought by the bill of costs. 19 In 2007, the GSA per USF&G is entitled to costs for lodging and USF&G is Dan Weir is listed on Exhibit 4 as attending the trial for 20 one day, incurring a total witness fee of $40.00; Exhibit 4 seeks 21 subsistence for three days in the amount of $489.79. 22 testified in the jury trial on February 9, 2007. 23 Exhibit 4 includes a hotel bill for the Radisson Hotel, 24 Indianapolis Airport for the night of February 7, 2007 ($142.60). 25 Mr. Weir arrived in Fresno on February 8, 2007 and departed on 26 February 9, 2007. Mr. Weir (Doc. 629) USF&G is entitled to the cost of Mr. Weir s 18 1 witness fee, lodging in the amount of $158 and meals in the 2 amount of $32.66 (the actual costs sought). 3 costs of $1,066.25, disallowing $566.13 of the $1,362.38 in costs 4 sought by the bill of costs. 5 USF&G is allowed Lowell Gratigny is listed on Exhibit 4 as attending the 6 trial for one day, incurring a witness fee of $40.00; Exhibit 4 7 seeks subsistence for four days in the amount of $727.46. 8 Exhibit 4 establishes that Mr. Gratigny submitted hotel bills for 9 only three nights. USF&G is entitled to lodging costs in the 10 amount of $237 ($79 x 3) and meals costs in the amount of $179.62 11 (the actual costs sought). 12 disallowing $350.84 in costs sought by the bill of costs. USF&G is allowed costs of $1,540.03, 13 The costs for lodging for Jack Zygner are reduced from 14 $352.28 to $158.00 ($79 x 2) and for meals from $230.45 to, 15 $162.00 ($54 x 3). 16 disallowing $262.73 in costs sought by the bill of costs. 17 USF&G is allowed costs of $642.90, As to the costs for Kathy Hacker, Ms. Hacker testified on 18 Friday, February 2, 2007 (Doc. 618) and on Tuesday, February 6, 19 2007 (Doc. 625). 20 for six days (January 29, 2007, January 30, 2007, January 31, 21 2007, February 1, 2007, February 5, 2007 and February 6, 2007). 22 Costs for hotel and meals on January 29-31, 2007 are disallowed. 23 $237.00 for hotels on February 1, 5, and 6, 2007 are allowed. 24 Costs for food in the amount of $56.43 (actual amount) are 25 allowed. 26 in costs sought by the bill of costs. Exhibit 4 describes costs for hotel and meals USF&G is allowed costs $3,293.81, disallowing $643.97 19 2. 1 2 Expert Witnesses. Lee objects to the witness fees for Bennett Bibel ($192.00) 3 and Stan Sheehan ($1,800.49) on the ground that these were expert 4 witnesses who were not appearing as such pursuant to contract, 5 statute, or appointment by the Court. 6 these witness fees must be limited to the $40.00 per day fee paid 7 to other fact witnesses, citing 28 U.S.C. § 1920(6); Crawford 8 Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 442 (1987). 9 Therefore, Lee contends, Exhibit 4 to USF&G cost bill establishes that Bibel was paid 10 a total of $80 for two days attendance at trial and $112.00 for 11 one day s stay at a hotel. 12 $79.00. 13 Costs of $159.00 are allowed. As to Mr. Sheehan, Mr. Smyth avers: 15. Although Lee objects to the recovery of the expenses of Mr. Sheehan incurred in connection with his testimony on the additional ground that in testifying as a percipient witnesses he also testified as an expert on the areas of his percipient testimony, as a key witness to the circumstances under which the worker s [sic] compensation policy was issued, he would have testified to the facts even if his testimony as an expert had been excluded. 14 15 16 17 18 19 20 21 22 23 The cost for the hotel is reduced to Lee s objection is meritless. USF&G is entitled to recover the costs set forth above for Mr. Sheehan s attendance at trial. USF&G is awarded fees for witnesses in the amount of $8,814.12. 24 D. 25 Lee objects to the $31,842.09 in copying costs on several 26 Copying Costs. grounds. 20 1 28 U.S.C. § 1920(4) enables the Court to allow copying costs 2 for any document necessarily obtained for use in the case and 3 does not specifically require that the copied document be 4 introduced into the record to be an allowable cost. 5 Co., Inc. v. Double Rainbow Gourmet Ice Cream, Inc., 920 F.2d 6 587, 588 (9th Cir.1990). 7 are permitted only for the physical preparation and duplication 8 of documents, not the intellectual effort involved in their 9 preparation. Zuill v. Shanahan, 80 F.3d 1366, 1371 (9th Haagen-Dazs Fees for exemplification and copying 10 Cir.1996), cert. denied, 519 U.S. 1090 (1997), quoting Romero v. 11 City of Pomona, 883 F.2d 1418, 1428 (9th Cir.1989). 12 research expenses incurred in assembling and preparing the 13 content of exhibits are not recoverable costs. 14 Expert Romero, id.3 Lee asserts that the majority of USF&G s requests for 15 copies are without any reference or description as to what the 16 copy charges were incurred for or whether they are related to 17 this case and that Lee cannot discern whether the copy charges 18 Lee cites Coats v. Penrod Drilling Corp., 5 F.3d 877, 892 (5th Cir.1993) as stating, The mere recitation with talismanic regularity of the phrase necessarily obtained for use in the case is not sufficient ... Some further showing is necessary. However, there is no such statement in Coats. Lee also cites Haroco, Inc. v. American Nat l Bank & Trust Co. of Chicago, 38 F.3d 1429, 1441 (7th Cir.1994), as holding that expenses for copies made solely for the convenience of counsel or the litigant s own use are not recoverable. Haroco does not so hold. Lee also cites M.T. Bonk Co. v. Milton Bradley Co., 849 F.2d 1404, 1410 (7th Cir.1991) for the proposition that copying costs may be disallowed when there is no indication whether the charges were in connection with pleadings, correspondence or other documentation in the case or were for USF&G s counsel s own convenience. Again, the case does not support Lee s contention. 3 19 20 21 22 23 24 25 26 21 1 were for USF&G s counsel [sic] own convenience. Lee further objects to $10,649.12 of the $31,842.09 copying 2 3 costs on the ground that USF&G has not substantiated that these 4 costs were for copies of papers necessarily obtained for use in 5 the case. 6 Lee specifically objects to the following costs: Date Invoice Description Amount 9/27/99 10480 Outside Document Reproductions Complex 601.05 10/8/99 10480 Outside Document Reproductions Complex 654.21 10/25/99 10480 Outside Document Reproductions Complex 101.40 11/8/05 CC-14004 Copying and binding of various documents 132.21 11/28/06 CC-144108 Heavy Litigation Copies 276.77 16 11/30/06 282303-1 Document copy 138.03 17 1/18/07 CC-26311 Heavy Litigation Copies 212.25 18 1/11/07 CC-26132 Medium Litigation Copies 416.75 12/20/06 CC-25698 Heavy Litigation Copies 71.45 12/29/06 CC-25852 Medium Litigation Copies 261.88 12/30/06 CC-25864 Medium Litigation Copies 792.45 12/31/06 CC-25891 Medium Litigation Copies 517.91 1/9/07 CC-26105 Heavy Litigation Copies 149.22 7 8 9 10 11 12 13 14 15 19 20 21 22 23 24 25 26 22 1 2/2/07 23849 Heavy Litigation Copies 354.80 2/2/07 9514 Printing Costs 1,028.30 2/5/07 9517 Imaging, Printing & CD creation 381.97 5 2/5/07 9521 Imaging, Printing & CD creation 109.10 6 2/6/07 9526 Imaging, Printing & CD creation 110.22 2/8/07 9536 Imaging, Printing & CD creation 138.26 2/15/07 29460 Messenger Service to Secretary of State 153.00 11 2/16/07 24039 Heavy Litigation Copies 170.68 12 2/25/07 CC-26476 PDF, CD creating, Blowbacks 51.00 1/30/07 29314 Messenger Service Dept. of Assessment and Taxation for USF&G corporate records 294.70 1/31/07 Certificate of Status via Internet of USF&G 40.00 1/19/07 Expedited copies of Articles of Incorporation of USF&G 79.00 2 3 4 7 8 9 10 13 14 15 16 17 18 19 20 21 2/27/07 466131 Meeting with Bruce Smyth to get case overview and discuss options for graphics (2 hrs @ $195/hr) 390.00 2/2/07 466131 Prepared first draft of graphics 780.00 22 23 24 25 26 23 1 and scanned key documents for use in slides (4 hrs @ $195/hr) 2 3 2/2/07 466131 Met with B. Smyth to review graphics (1 hr @ $195/hr 195.00 2/2/07 466131 Continued work on slides (1 hr @ $195/hr) 195.00 2/2/07 466131 Met at client s office to revise graphics; continued work back at office (4.5 hrs @ $195/hr) 877.50 2/2/07 466131 GoPal revised slides per client s notes 395.00 2/2/07 466131 Revised slides/timeline (3 hrs @ $195/hr) 585.00 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 In response, USF&G relies on Mr. Smyth s Declaration: 17. All of the copying and exemplification costs set forth in Exhibit 5 were incurred by the counsel for USF&G and American Specialty in connection with the litigation of the case. The litigants, American Specialty and USF&G, are located in Indiana and the East Coast and have their own copying facilities for their own use. The costs of copying in-house at Charlston, Revich & Wollitz LLP and through outside vendors, where necessary, were incurred to obtain copies of documents from Lee Investments, Rexford Properties, Aon Risk Services, GAB and Diana Conley and providing service and filing copies regarding the various and numerous motions filed by USF&G and American Specialty and in opposition to Lee s various 24 1 motions .... 2 18. Although Lee challenges the copy charges as improperly including fees paid to experts for intellectual efforts in assembling and preparing the copies, the costs sought are at the in-house rate of $.10 per page or the actual charges of the copy service vendors for the physical preparation and duplication of documents. 3 4 5 6 7 8 9 10 11 12 19. Exhibit 5 also includes the cost of obtaining certified copies of the articles of incorporation of USF&G from the Maryland Department of Assessment and Taxation to establish that USF&G was in fact incorporated in the State of Maryland. Although the status of incorporation of USF&G in the State of Maryland was determined from reliable computerized research records, Lee refused to accept that computerized information and required USF&G to incur the expenses of obtaining articles of incorporation on an expedited basis and obtain copies. 13 14 15 16 17 18 19 20. Exhibit 5 also included sums included for the preparation of a timeline of events utilized in USF&G s opening and closing statements and referred to during the trial and provided to the jury as well as for the preparation of graphics setting forth the relations of the parties from Paulson Reporting. USF&G has sought recovery only for the costs of the expenses utilized to prepare and revise the presentation slides and subsequently [sic] documentary timeline in the sum of $3,412.50, and not the full expenses of that vendor. 20 21 22 23 24 25 26 21. Although Lee objects to the in-house charges for copies, the charges that reflect the copying costs which were in fact charged to USF&G and American Specialty in this matter, for copies of documents produced, pleadings, motions, service copies and exhibits. The largest portion of the inhouse copy charges were incurred in the filing and service of motions, pleadings and deposition designations with this Court and filings and exhibits utilized during the jury trial. Thus, large charges were incurred 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 with the pre-trial motions including USF&G s motion in limine to resolve the case, motions to strike USF&G s affirmative defenses and its motion to dismiss the counterclaim of Rexford Parties. See charges dated 9/28/2006 for $343.00 and 10/30/2006 for $960.00 (for a total of $1,303.00). 22. The next large group of charges centers on the designation of deposition transcripts, the preparation of drafts and responses regarding the pretrial order and the briefing in support of and oppositions to almost 40 motions in limine. See in-house charges dated 12/27/2006 for $202.40, $217.70, $448.70, and $12.80 (for a total of $886.60). The next grouping of charges for in-house copies all took place for work shortly before the trial and includes copies of trial exhibits, trial briefs and copies of deposition transcripts. See charges dated 1/29/2007 for $10.00, $155.30, $231.70, $6.80, $553.10, $2.00 and $1652.40 and charge dated 2/28/2007 for $906.50 (for a total of $3,517.80). As a result, the in-house copying charges in connection with the jury trial total $5,707.40 alone. 23. The final large grouping of costs were incurred in connection with the April 4-6, 2007 bench trial, the preparation of proposed findings of fact and conclusions of law and the responses to Lee s various motions to amend the judgment and for new trial. See in-house copy charges dated 3/28/2007 for $294.60 and 4/26/2007 for $289.40 (for a total of $584.00). 24. Although Lee contends that various of the changes of the outside vendors could have been used for other purposes, the records of those invoices demonstrates that such costs were in fact incurred in obtaining documents from third parties in the case or for trial. While in some circumstances, the charges or billing invoices do not set forth the specific documents copied, other available information establishes that the copies were necessarily made in and for the litigation in the case. For example, the entries for October 8, 1999 and October 25, 1999 for 26 outside document reproductions, were incurred at the time I worked on the production of documents for USF&G to Lee and reviewed documents produced by Lee. 1 2 3 25. Other document copying costs for outside services, such as those for November 8, 2005 and November 28, 2006, December 20, 29, 30 and 31, 2006, were ordered by my legal assistants at the time, Carsi Beechler and Anna Tom. Other charges, dated January 18, 2007 and January 9, 2007, reference documents bearing a U prefix, the prefix utilized for USF&G trial exhibits in exchanges of documents among the parties. The entries for January 11, 2007 were ordered by the paralegal assigned only to the trial of the case, Tom Hayden. One charge, dated February 2, 2007, was a copy charge for GAB Robbins documents by another attorney in this office, Chad Wooten, in connection with documents obtained for use at trial. The invoices for February 2, 5, 6, and 8, 2007 were costs of copying in connection with the trial of this matter ordered by the temporary trial assistant, Jan Williams, located out of the temporary Fresno office utilized by USF&G s counsel during the pendency of the trial. 4 5 6 7 8 9 10 11 12 13 14 15 The litigation involved an extended time period, a 16 construction project, and an injured employee who incurred over 17 $1,000,000 in medical expenses. There were three sides to the 18 case and a large volume of documents. Because the copying costs 19 were limited to 10¢ per page and all parties needed voluminous 20 documents to prepare for and to try the case, the copying costs 21 have not been shown to unnecessary or excessive. These costs are 22 allowed. 23 USF&G is awarded copying costs in the amount of $31,842.09. 24 E. OTHER COSTS. 25 Lee objects to $9,070.50 of the $14,335.50 of other costs 26 27 1 listed on the bill of costs. 2 of Arthur Levine on April 25, 2006 ($2,655.00), June 2, 2006 3 ($2,065.00), June 20, 2006 ($3,613.00, and September 9, 2006 4 ($737.50). 5 expert nor was he authorized pursuant to any statute and that 6 these costs should be entirely disallowed. 7 1920(6); Crawford Fitting Co., supra, 482 U.S. at 442. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 These costs are expert witness fees Lee asserts that Dr. Levine was not a court-appointed See 28 U.S.C. § In response, USF&G relies on Mr. Smyth s Declaration: 24. USF&G and American Specialty also seek the recovery in the interest of justice of all, or at least part, of the expert witness fees paid to Arthur Levine for his deposition testimony, a sum which totaled $9,071.25. In the case, USF&G and American Specialty were unfairly forced to incur these fees to take extremely lengthy depositions of Dr. Levine necessitated by his repeated changes to his testimony and his lengthy, exhaustive and exhausting testimony about topics which were not properly the subject of expert testimony. In the limited circumstances when such testimony might be admissible, Dr. Levine s testimony was so obviously biased and lacking in reasonable foundation that it had no probative value. Most of the topics of Dr. Levine s testimony were excluded by this Court on the motion in limine of USF&G and American Specialty. In the limited areas where Dr. Levine did testify, his testimony was inherently unbelievable and involved simply the biased taking of a side in litigation rather than appropriate testimony of an expert. USF&G respectfully request the award of all or at least a portion of the expert witness fees they were compelled to pay in order to elicit largely inadmissible, biased and inherently unbelievable testimony of Dr. Levine. 24 USF&G cites no authority permitting the Court to award these 25 costs in the interests of justice and none has been found. 26 28 1 Crawford Fitting and Section 1920(6) preclude allowance of these 2 other costs. These costs are disallowed. CONCLUSION 3 For the reasons stated, USF&G s Bill of Costs is taxed at 4 5 the amount of $78,936.94. 6 IT IS SO ORDERED. 7 Dated: 668554 August 2, 2010 /s/ Oliver W. Wanger UNITED STATES DISTRICT JUDGE 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 29
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