Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_03-cv-02488/USCOURTS-casd-3_03-cv-02488-3/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 28:1331 Fed. Question

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

OTAY LAND COMPANY, a Delaware

limited liability company, et al.,

Plaintiffs,

CASE NO. 03cv2488 BEN 

ORDER AFTER REMAND 

RE-AWARDING COSTS UNDER 

28 U.S.C. § 1919

vs.

U.E. LIMITED, L.P., a California limited

partnership, et al.,

Defendants.

INTRODUCTION

This matter is before the Court for the third time upon the Mandate of the United States

Court of Appeals for the Ninth Circuit. On April 16, 2012, a hearing was held to spread the

Mandate. Although notice was sent to both firms representing Plaintiffs, Counsel for Plaintiffs

failed to appear and failed to contact the Court before the hearing. Counsel for Defendants did

appear. 

Previously, this Court entered summary judgment in favor of Defendants and noted that the

case was not ripe. See Otay Land Co. v. U.E. Ltd. LP, 440 F. Supp. 2d 1152 (S.D. Cal. 2006). 

Costs were awarded to Defendants as prevailing parties under 28 U.S.C. § 1920. Plaintiffs

appealed. The Ninth Circuit found that the action was not ripe. It remanded the case with

instructions to dismiss the Complaint, and to determine whether Defendants were entitled to costs

under 28 U.S.C. § 1919. Otay Land Co. v. United Enters., Nos. 06-56132, 07-56514, 07-56515,

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2009 U.S. App. LEXIS 16294 (9th Cir. Jul. 22, 2009). On March 29, 2010, on remand, this Court

dismissed the Complaint and awarded “just costs” to Defendants, not under 28 U.S.C. § 1920, but

under § 1919. Plaintiffs appealed again. Now, the Ninth Circuit has remanded for further

consideration of what constitutes “just costs,” under a newly announced standard. See Otay Land

Co. v. United Enters., 672 F.3d 1152 (9th Cir. 2012).

Plaintiffs have had an opportunity to present their arguments. The Defendants first filed

their bills of costs in August of 2006. The requests were detailed. For example, Defendant Scott

filed his motion to tax costs of $44,541.62 with more than 120 pages of exhibits. Defendant

Baldwin Builders filed its motion to tax cost of $116,680.85 with over 130 pages of exhibits. The

other Defendants followed suit. The Clerk of Court set a date for hearing objections. Plaintiffs

filed an objection to the bill of costs by Defendant Ennis. They likewise filed separate objections

to each of the other Defendant’s costs. The hearing was held and counsel for Plaintiffs appeared

personally at the office of the Clerk of Court. The Clerk of Court issued his decisions on

December 8, 2006, and Plaintiffs filed their motion to re-tax costs awarded to Defendant Ennis and

Defendant Scott shortly thereafter. However, Plaintiffs missed the deadline for filing their

motions to retax the costs awarded to United Enterprises Defendants and the Baldwin Builders

Defendants. One month later, Plaintiffs sought leave to file late their motion to re-tax costs for the

remaining Defendants in twin 200-page filings. Defendants filed opposition briefs; Plaintiffs filed

three reply briefs. The Court declined to consider the late motions and ruled without a hearing. 

On appeal, Plaintiffs argued primarily that Defendants were not prevailing parties. The court of

appeals agreed and remanded for consideration of costs under § 1919, instead of § 1920. At the

appeal mandate hearing before this Court on October 13, 2009, Plaintiffs took the further

opportunity to argue against any award of costs under § 1919. Although given notice, at the most

recent appeal mandate hearing, Plaintiffs did not appear. Nevertheless, this Court directed

Defendants’ counsel to articulate Plaintiffs’ arguments in Plaintiffs’ absence. 

LEGAL STANDARD

In its decision, the Ninth Circuit explains that while § 1919 does not define the term “just

costs,” a court is to consider “what is most fair and equitable under the totality of the

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circumstances.” See Otay Land Co., 672 F.3d at 1157. It emphasizes a “case-by-case approach”

based on the circumstances and equities of each case. Id. In fleshing out the discretionary “just

costs” standard, the Court of Appeals details a non-exclusive list of four factors worth considering.

The first and most important factor, according to the Court of Appeals, is that § 1919 does

not employ a prevailing party standard. Id. at 1157-58. A costs award is not mandatory, but

discretionary. Id. at 1158. A second factor to be considered is the role played by “exigent

circumstances, such as hardship or culpable behavior by the parties.” Id. Moreover, just costs

may be awarded even in the absence of extraordinary circumstances. Id. Also not definitive, but a

legitimate consideration is the third factor: the strength of the plaintiff’s dismissed jurisdictional

claim. Id. For this factor, the Court of Appeals notes that “the driving motivation behind § 1919

is to balance the need to deter improper or wrongful invocations of federal jurisdiction against the

importance of providing a federal forum for actions that fulfill the ‘statutory criteria’ for

jurisdiction. Id. The fourth factor a court may consider is the significance of pending parallel

state court litigation. Id. at 1159. While a federal court may defer an award of just costs while

state litigation is ongoing, it need not. Id. If the costs in question may be justly awarded in the

federal case, there is no reason to defer to future state court proceedings. Id.

DISCUSSION

To be clear, this Court understands that it has discretion to completely deny Defendants’

costs under § 1919. The Court may also apportion costs between the parties, provided that there is

genuine, non-speculative, non-arbitrary basis for doing so. Finally, the Court may award all costs

to the Defendants, which in some cases might well be the same costs that would be awarded to a

defendant if a defendant were a prevailing party under § 1920. Under § 1919, a court’s costs

award will be the result of its case-by-case review of the circumstances and equities of the case –

and the result will be “what is most fair and equitable under the totality of the circumstances.” 

In arriving at its prior decision, a decision reconsidered and reimposed today, this Court

did consider the circumstances and equities of this particular case and was aware of the range of its

discretion under § 1919. 

As to the first “just costs” factor, this Court did not presume Defendants were entitled to

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their costs simply because they were prevailing parties.1 Instead, each of the Defendants is entitled

to all of their costs because this allocation is just and fair. From the inception of this case, the

equities favored the Defendants. 

Culpability, the second “just costs” factor also weighs against the Plaintiffs. Plaintiffs

bought the real estate (giving rise to this litigation) where the defunct shooting range was open and

obvious. Then Plaintiffs, represented by expert environmental counsel, chose to bring this action

based on tenuous CERCLA and RCRA theories years before the action was ripe. Not interested in

addressing the jurisdictional issue of ripeness, Plaintiffs relentlessly pushed past the question – as

evidenced by three amended complaints, multiple expert depositions, multiple discovery disputes,

and motions for reconsideration and appeals, resulting in 386 docket entries prior to the first

appeal – and all while the case was unripe. Because Plaintiffs were masters of their complaint and

the sole decision-makers of when to file it and how to prosecute it, justice and fairness requires

Plaintiffs pay for the costs Defendants were forced to incur to defend against the litigation

onslaught.

The third “just costs” factor looks at the strength of the jurisdictional claim. In this case,

the Plaintiffs’ federal claims were weak. The jurisdictional timing was premature by years, not

days. This was not a case where Plaintiffs can claim jurisdiction was lost through happenstance or

1

 It is understandable that the Court of Appeals misunderstood this Court’s costs order as

implying a prevailing-party presumption. That is what Plaintiffs argued on appeal. Plaintiffs argued,

“the District Court instead treated Appellees as if they had prevailed on the merits of their claims and

awarded costs accordingly.” Appellants’ Reply Br. at 8. Notably, missing from Plaintiffs’ appellate

brief was any mention of this concluding sentence from the order on costs: “The Court VACATES

its prior determination that Defendants are prevailing parties, as such determination is extraneous and

irrelevant for purposes of 28 U.S.C. § 1919.” Order After Remand (dated Mar. 28, 2010), at 3

(emphasis added). Also missing from Plaintiffs’ appellate brief is mention of the following colloquy

at the appeal mandate hearing, which took place between Plaintiffs’ counsel and the Court: 

Counsel: And we believe if you look at the legislative history of 1919, you will see that

just costs may be imposed. That under just costs, the defense is not entitled to

the presumption that they’re entitled to costs because they prevailed.

The Court: Forget the presumption, I agree. All right, so there is no presumption. But

why shouldn’t they get just cost[s]? They haven’t prevailed because the action

is being dismissed, but the action is being dismissed because it was not ripe

and there was no jurisdiction. So we did all of this litigating, all of this time,

all of this money, only to eventually decide that there was no jurisdiction.

(Tr. of Appeal Mandate Hr’g on May 13, 2010 (docket no. 416), at 8:8 to 8:19.)

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that jurisdiction existed at the outset, but was lost along the way due to events out of Plaintiffs’

control. The failure to correctly assess the ripeness of the federal claims – and thus, the federal

court’s lack of jurisdiction – was entirely of the Plaintiffs’ own doing. Awarding Defendants all of

their costs in this case furthers the Congressional objective of deterring other plaintiffs from

improperly and prematurely invoking federal jurisdiction. Id. at 1158 (driving motivation behind

§ 1919 is balancing need to deter wrongful invocations of federal jurisdiction against providing

forum for actions satisfying statutory criteria for jurisdiction).

The fourth “just costs” factor considers the significance of pending parallel state court

litigation. In this case, the federal claims were tenuous and the lawsuit premature. Yet, the

Defendants had no choice but to incur defense costs. Here, one cannot separate out the costs

incurred defending the dismissed federal claims and the costs incurred which might be later useful

in defending the state court action. As Plaintiffs wrote in their appellate brief, “it is impossible to

distinguish which costs were related to investigation and litigation of the federal causes of action

that were dismissed and those costs which were related to the ancillary state law claims.” 

Appellants’ Reply Br. at 19 (emphasis added). 

Moreover, due to the passage of time and changing environmental conditions, it is clear

that some of the costs incurred obtaining expert witness opinions will have been wasted. At

bottom, since the costs awarded today are just and fair in this federal case, there is no need to defer

to future proceedings in state court. Id. at 1159. This action was filed in 2003. Today, it is 2012. 

The Defendants have lost the time value of their money. Delaying the payment of costs further

would be unfair and unjust. As the Supreme Court observed in a different context, but applicable

here, “[p]rotecting against abusive delay is an interest of justice.” Martel v. Clair, 132 S. Ct.

1276, 1286 (2012) (emphasis in original). As to Plaintiffs’ argument that some of the costs

incurred would be useful to the Defendants in the state court litigation, this Court found the

argument unpersuasive and the Ninth Circuit agreed. Otay Land Co., 672 F.3d at 1159-60.

After considering the totality of the circumstances, this Court finds that there is no reason

to award Plaintiffs costs or to apportion costs. This Court further finds that what would be unfair

and unjust would be to make the Defendants absorb any of the costs they were forced to incur. 

Plaintiff have pursued a “scorched earth” strategy throughout this litigation, including ad

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hominem attacks on this Court accusing it, in a less than flattering way, of “ruminating” and

making “uninformed” decisions. Sadly, perhaps if Plaintiffs had ruminated a little longer before

commencing this action, they would have been better informed and might have observed what was

apparent to this Court, as well as the Ninth Circuit: that this action was not ripe. 

CONCLUSION

Accordingly, having considered whether to award “just costs” to any of the parties under

28 U.S.C. § 1919, the Court finds that it is fair and equitable under the totality of circumstances to

re-award costs to Defendants in the same amounts set out in the previous Order After Remand

(dated Mar. 28, 2010). Therefore, the Court awards costs to Defendant Phil Scott in the amount of

$44,541.62, Defendant Ray Ennis in the amount of $8,659.13, Defendant Olin Corporation in the

amount of $30,540.95, Defendant Baldwin Builders in the amount of $116,430.85, and Defendants

UE Limited, LP, United Enterprises, LTD, United Enterprises, Inc., John T. Knox and Patrick J.

Patel in the amount of $71,818.01.

IT IS SO ORDERED.

DATED: May 24, 2012

Hon. Roger T. Benitez

United States District Judge

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