Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_05-cv-02045/USCOURTS-azd-2_05-cv-02045-4/pdf.json

Nature of Suit Code: 423
Nature of Suit: Bankruptcy Withdrawal 28 USC 157
Cause of Action: 28:0157 Motion for Withdrawal of Reference

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 The Clerk of the Court taxed costs on May 13, 2008.

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

In re:

Michael Keith Schugg, dba Schuburg

Holsteins, 

Debtor. _________________________________

In re: 

Debra Schugg,

Debtor. _________________________________

G. Grant Lyon, in his capacity as Chapter

11 Trustee of the bankruptcy estate of

Michael Keith Schugg and Debra Schugg;

Wells Fargo Bank, N.A., 

Plaintiffs, 

vs.

Gila River Indian Community, 

Defendant. 

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No. CV 05-2045-PHX-JAT

ORDER

BK No. 2-04-13226-PHX-GBN

BK No. 2-04-19091-PHX-GBN

ADV. No. 2-05-ap-00384-GBN

Pending before this Court is Gila River Indian Community’s motion to stay the

taxation of costs order.1

 The Community argues that the taxation of costs order should be

stayed pending the resolution of the appeals. The Trustee responds and argues that a

judgment on the award of costs should be entered immediately so that the Trustee can earn

Case 2:05-cv-02045-JAT Document 302 Filed 11/25/08 Page 1 of 3
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2

 At least one court has held that interest accrues on taxed costs from the date of the

original judgment. See Georgia Assoc. of Retarded Citizens v. McDaniel, 855 F.2d 794, 799

(11th Cir. 1988).

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interest on that judgment.2 Presumably, once such judgment is entered, the Trustee could

also start collection efforts, see Fed. R. Civ. Pro. 62(a), unless execution was stayed, see

Fed. R. Civ. Pro. 62(d). However, the Trustee asserts that he does not intend to start

collection efforts, he merely wants an immediate judgment for interest purposes.

Local Rule Civil 54.1(b) states: “In the absence of objection, any item listed may be

taxed in the discretion of the Clerk. The Clerk shall thereupon docket and include the costs

in the judgment.” In this case, there was an objection to the Bill of Costs. Thus, this case

is taken out of the language of the Local Rule that calls for an automatic amendment of the

judgment to include the costs taxed.

Although there was an objection to the Bill of Costs, there was not an appeal of the

taxation order to the District Court. Therefore, the taxation order is “final.” See id. (“The

taxation of costs thus made shall be final unless modified on review by the Court on motion

served within five (5) days thereafter.”) The Local Rules are silent as to what occurs when

a taxation order on a bill of costs to which there was an objection becomes final. 

Federal Rule of Civil Procedure 54 says: “‘Judgment’ as used in these rules includes

a decree and any other order from which an appeal lies” (emphasis added). “Judgments for

costs may be immediately appealed as final judgments, entered after the judgment on the

merits, or as collateral orders.” Wright, Miller and Kane, Federal Practice and Procedure:

Civil 3d § 2679 at 489 (1998) (emphasis added).

In Cohen v. Beneficial Industrial Loan Corp. the Supreme Court announced

an expansive interpretation of the finality requirement in 28 U.S.C.A. § 1291

that has come to be known as the “collateral order” doctrine. Appeals are

allowed from orders characterized as final under this doctrine even though it

may be clear that they do not terminate the action or any part of it. The only

finality required is that the district court have made its final determination of

the matter in question.

Wright, Miller and Cooper, Federal Practice and Procedure: Jurisdiction 2d § 3911 (1992)

[footnote omitted].

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3

 The taxation order became final when no appeal was taken to the district court

within the five day time limit.

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Taking these rules together, the Court finds that when the Clerk’s order taxing costs

became “final” under the Civil Local Rules,3

 it also became collateral order which was

immediately appealable to the Court of Appeals. Because a collateral order is an “other order

from which an appeal lies” it is effectively a judgment as the term is used in Federal Rule of

Civil Procedure 54.

Thus, given that the taxation of costs order has effectively become a judgment, it can

be executed on by the Trustee. However, the Community is arguing that, although no appeal

of the taxation of costs order on the merits has been taken to the Court of Appeals, effectively

the right to the taxation of costs has been appealed to the Court of Appeals by the taking of

an appeal on the judgment on which the taxation is premised. This Court agrees that the

award of costs is effectively on appeal because the underlying judgment is on appeal. See

Amarel v. Connell, 102 F.3d 1494, 1523 (9th Cir. 1996). Thus, because the taxation of costs

order is effectively on appeal, execution of that judgment is governed by Federal Rule of

Civil Procedure 62(d). Rule 62(d) says that a stay of execution of a judgment on appeal can

be obtained only by posting an appropriate bond. Thus, the motion to stay the taxation order

will be denied without prejudice to the Community posting a bond to stay execution.

Accordingly,

IT IS ORDERED that the Motion to Stay the Taxation of Costs Order Pending

Resolution of the Parties’ Appeals (Doc. #299) is denied, however, execution on the taxation

of costs order is stayed for 10 days from the date of this order to permit compliance with

Federal Rule of Civil Procedure 62(d) if the Community so chooses.

DATED this 24th day of November, 2008.

Case 2:05-cv-02045-JAT Document 302 Filed 11/25/08 Page 3 of 3