Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_04-cv-04632/USCOURTS-cand-3_04-cv-04632-51/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 18:1961 Racketeering (RICO) Act

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO BAY AREA RAPID

TRANSIT DISTRICT,

Plaintiff,

 v.

 WILLIAM D. SPENCER, et al.,

Defendants. /

No. C 04-04632 SI

ORDER RE: CLERK’S TAXATION OF

COSTS

Plaintiff and defendant William McGahan both have filed motions for review of the clerk’s

taxation of costs. The motions are scheduled for hearing on November 16, 2007. Pursuant to Civil Local

Rule 7-1(b), the Court determines that the matter is appropriate for resolution without oral argument,

and VACATES the hearing. Having considered the papers submitted, the Court hereby GRANTS

plaintiff’s motion to review the clerk’s taxation of costs and DENIES defendant’s motion to review the

clerk’s taxation of costs.

BACKGROUND

After a jury trial was held in this case in early 2007, verdicts were entered in favor of plaintiff

Bay Area Rapid Transit against defendants William D. Spencer, Bruce R. Bonar, F.W. Spencer & Son,

Inc., and Brisbane Mechanical Co. Defendant William McGahan was found not liable. As a result,

plaintiff was a prevailing party as to four defendants, while McGahan was also a prevailing party.

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United States District Court

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Plaintiff and McGahan, as prevailing parties, both moved for costs. The Court denied plaintiff’s motion

as untimely and, in its May 31, 2007 Order, permitted McGahan to submit a bill of costs to the clerk.

On September 28, 2007, the clerk taxed costs against plaintiff and in favor of McGahan in the amount

of $59,523.21. The clerk sustained many of plaintiff’s objections to McGahan’s costs. These motions

for review of the clerk’s assessment followed.

LEGAL STANDARD

An award of costs to a prevailing party is permitted as a matter of course under Federal Rule of

Civil Procedure 54(d)(1) and 28 U.S.C. § 1920. Upon motion for review of the clerk’s taxation of costs,

the clerk’s actions may be reviewed by the court. Fed. R. Civ. P. 54(d)(1). The Supreme Court has

indicated that on review of the clerk’s assessment it is the district court’s responsibility exercise its own

discretion. See Farmer v. Arabian Am. Oil Co., 379 U.S. 227 (1964), disapproved of on other grounds

by Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 442-43 (1987); see also Fed. R. Civ. P.

54(d)(1) (“costs . . . shall be allowed as of course to the prevailing party unless the court otherwise

directs”). While the decision to award or refuse to award costs is left to the discretion of the district

court, In re Media Vision Tech. Sec. Litig., 913 F. Supp. 1362, 1366 ( N.D. Cal. 1996), Rule 54 creates

a presumption in favor of awarding costs to the prevailing party, see Ass'n of Mexican-American

Educators v. State of California, 231 F.3d 572, 591 (9th Cir. 2000). 

DISCUSSION

1. Defendant’s motion for review of the clerk’s taxation of costs

Defendant McGahan asks the Court to award additional costs in the amount of $38,706.14 for

court reporter fees and exemplification fees. Plaintiff responds that defendant’s motion for review of

the clerk’s taxation of costs was untimely. The Court agrees. Rule 54 unambiguously states that costs

may be taxed by the clerk, and that “[o]n motion served within 5 days thereafter, the action of the clerk

may be reviewed by the court.” Fed. R. Civ. P. 54(d)(1) (emphasis added). Civil Local Rule 54-5

similarly states that “any motion for review of the Clerk’s taxation of costs must be filed within 5 days

of the entry of the notice of taxation of costs.” The clerk’s taxation of costs was filed on Friday,

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September 28, 2007 [Docket No. 412]. Not counting the two weekend days immediately following, any

motions for review were due by Friday, October 5, 2007, the fifth day after the taxation of costs was

entered. Defendant’s motion, however, was not filed until Monday, October 8, 2007, and was therefore

untimely. 

Defendant argues that Civil Local Rule 54-5 permits courts to consider motions filed within 15

days after taxation of costs, because the rule states that “[i]f no motion is filed within 15 days of the

Clerk’s taxation of costs, the Clerk’s determination of costs shall be final.” Federal Rule of Civil

Procedure 54(d)(1), on the other hand, does not provide for an additional 10-day window. Although

defendant is correct that this Court has previously stated that the local rule “demonstrates that courts can

consider motions filed more than 5 days after entry of notice of taxation of costs,” Lopez v. San

Francisco Unified Sch. Dist., 385 F. Supp. 2d 981, 1000 (N.D. Cal. 2005) (emphasis added), the

circumstances of this case dictate that the Court choose not to consider defendant’s motion. Defendant

has provided no reasonable explanation of why its motion was untimely, and it would be inequitable to

consider defendant’s untimely motion when the Court has strictly enforced filing deadlines and has

denied as untimely plaintiff’s motion for costs. See May 14, 2007 Order at 19-20 [Docket No. 401].

The Court DENIES defendant’s motion to review the clerk’s taxation of costs as untimely.

2. Plaintiff’s motion for review of the clerk’s taxation of costs

Plaintiff asks the Court to review the clerk’s taxation of costs in the amount of $59,523.21 in

favor of defendant McGahan, a prevailing party. Plaintiff does not dispute the individual items or

amounts, but rather disputes the overall award of costs to McGahan because he was one of five

defendants – the rest of whom were not prevailing parties – and there is no evidence he actually incurred

the costs himself. Defendant argues in response that he is entitled to costs as a prevailing party and that

the burden is on the party contesting the award of costs to prove otherwise. 

Defendant is correct that Rule 54 creates a presumption in favor of awarding costs to the

prevailing party. See Ass'n of Mexican-American Educators, 231 F.3d at 591. The Court therefore

disagrees with plaintiff that defendant, though he is a prevailing party, should be awarded zero costs

because he has not proven that he himself actually incurred the costs claimed. That said, it would make

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little sense to award a single defendant a full amount of costs when much of those costs were incurred

in defense of other defendants. When presented with unique situations such as this, the Court may

exercise its discretion to determine the amount of costs that should be awarded. See Farmer, 379 U.S.

at 232-33; In re Media Vision Tech., 913 F. Supp. at 1366; Fed. R. Civ. P. 54(d)(1). The Ninth Circuit

has held that district courts have discretion to deny costs to a prevailing party for reasons other than

misconduct. Ass'n of Mexican-American Educators, 231 F.3d at 592-93. Here, the evidence strongly

suggests, and defendant has not stated otherwise, that the costs defendant submitted were not incurred

solely in relation to his defense but were incurred as part of the defense of all five defendants. For

instance, in seeking court reporter and transcript costs, defendant submitted a bill of costs that covers

all deposition transcripts and all trial transcripts, even though these documents were undoubtedly shared

by all five defendants. See Whitfield Decl. at ¶ 8 and ex. 3; see also Whitfield Decl. at ¶¶ 4-5 (stating

that the firm tracks costs by using a billing code that is assigned to each case, not each individual client,

and submitting a bill of costs reflecting the total amount of costs for the billing code as a whole). 

In this situation, the prevailing defendant is entitled only to a portion of the costs incurred by the

entire group of defendants. To hold otherwise would result in a windfall for defendants and “would be

‘inequitable under the circumstances,’” Sheehy v. Town of Plymouth, 2001 WL 92386 *4 (D. Mass. Jan.

18, 2001) (quoting 10 Moore’s Federal Practice 3d, § 54.101[1][b] at 54-151). Had defendant

submitted some evidence or a declaration explaining what portion of the costs were related to his

defense, the Court could use that as a basis for reducing the clerk’s taxation of costs. Defendant has not

done so, however, and plaintiff correctly notes that an opposing party is in no position to present

evidence detailing how another party’s costs are allocated. The Court therefore agrees with plaintiff that

because McGahan is one of five defendants, he is entitled only to one-fifth, or 20%, of the costs taxed

by the clerk. See Gorelangton v. City of Reno, 638 F. Supp. 1426, 1433 (D. Nev. 1986). The Court

GRANTS plaintiff’s motion to review the clerk’s taxation of costs. Defendant may collect 20% of the

$59,523.21 taxed by the clerk, for a total of $11,904.64. 

CONCLUSION

For the foregoing reasons and for good cause shown, the Court DENIES as untimely defendant’s

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motion for review of the clerk’s taxation of costs [Docket No. 415] and GRANTS plaintiff’s motion for

review of the clerk’s taxation of costs [Docket No. 414]. 

IT IS SO ORDERED.

Dated: November 9, 2007 SUSAN ILLSTON

United States District Judge

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