*

The Honorable Milton I. Shadur, United States District Judge for the

Northern District of Illinois, sitting by designation.

1

RECOMMENDED FOR FULL-TEXT PUBLICATION

Pursuant to Sixth Circuit Rule 206

ELECTRONIC CITATION: 2004 FED App. 0261P (6th Cir.)

File Name: 04a0261p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

_________________

REBEKAH MCCAIN,

Plaintiff-Appellant,

v.

DETROIT II AUTO FINANCE

CENTER and BANK ONE, N.A.,

Defendants-Appellees.

X

-

-

-

-

>

,

-

-

-

-

N

No. 03-1270

Appeal from the United States District Court

for the Eastern District of Michigan at Detroit.

No. 02-70855—Patrick J. Duggan, District Judge.

Argued: June 18, 2004

Decided and Filed: August 5, 2004 

Before: GILMAN and ROGERS, Circuit Judges; 

SHADUR, District Judge.*

2 McCain v. Detroit II Auto Finance, et al. No. 03-1270

1

Although McCain’s petition spoke of “attorney fees” (and Detroit

II and the district court followed her lead in that respect), and although the

statutes and cases are all over the lot (some using that term, others

speaking of “attorneys’ fees” and still others of “attorney’s fees”), we

employ the usage in the text, as did the Supreme Court in the Marek case

discussed hereafter. But see Stallworth v. Greater Cleveland Reg’l

Transit Auth., 105 F.3d 252, 254 n.1 (6th Cir. 1997).

_________________

COUNSEL

ARGUED: Ian B. Lyngklip, LYNGKLIP & TAUB,

Southfield, Michigan, for Appellant. Jason M. Katz, KATZ

& KATZ, Southfield, Michigan, for Appellees. ON BRIEF:

Ian B. Lyngklip, LYNGKLIP & TAUB, Southfield,

Michigan, for Appellant. Jason M. Katz, KATZ & KATZ,

Southfield, Michigan, for Appellees.

_________________

OPINION

_________________

MILTON I. SHADUR, District Judge. Rebekah McCain

(“McCain”) originally brought suit against Detroit II Auto

Finance Center (“Detroit II”) and Bank One, N.A. (“Bank

One”) in connection with events that took place when she

attempted to secure a loan to purchase a vehicle. After

Detroit II’s tender and McCain’s acceptance of a Fed. R. Civ.

P. (“Rule”) 68 offer of judgment had produced a $3,000

judgment in McCain’s favor, her counsel petitioned the

District Court for an award of costs and attorney’s fees.

1

 That

petition was denied in its entirety, and after the stipulated

with-prejudice dismissal of McCain’s Second Amended And

Supplemented Complaint, McCain filed an appeal against

Detroit II pursuant to 28 U.S.C. § 1291. We REVERSE the

District Court’s denial of an award of costs and AFFIRM its

denial of an attorney’s fee award.
No. 03-1270 McCain v. Detroit II Auto Finance, et al. 3

BACKGROUND

McCain sought legal redress after having experienced

numerous difficulties with Detroit II and Bank One in the

course of her purchase and financing of a new automobile.

McCain filed a multi-count Amended Complaint, seeking to

invoke against Detroit II the federal Truth in Lending Act (15

U.S.C. § 1640)(Count I) and Equal Credit Opportunity Act

(15 U.S.C. § 1691)(Count II) as well as several Michigan

statutes--the Consumer Protection Act (Mich. Comp. Laws

§ 445.901)(Count IV), Motor Vehicle Sales Finance Act

(Mich. Comp. Laws § 492.101)(Count X), Credit Reform Act

(Mich. Comp. Laws § 445.1851)(Count XI) and Motor

Vehicle Installment Sales Act (Mich. Comp. Laws

§ 566.301)(Count XII)-- and also advancing some

nonstatutory claims (Counts VI, VII, VIII and XIV). Both

Count I and the “Request for Relief” section of the Amended

Complaint contained express requests for the award of costs

and attorney’s fees, with the Request for Relief doing so as to

the bulk of McCain’s claims. 

Several months into the litigation Detroit II delivered this

Rule 68 offer to McCain:

NOW COMES, the Defendant, Detroit II Auto Finance

Center, Inc., by and through its attorney, Howard Alan

Katz, and presents the following offer of judgment

pursuant to FRCP 68. The defendant, Detroit II Auto

Finance Center, Inc., offers to the Plaintiff, Rebekah

McCain, the amount of three thousand dollars ($3000.00)

as to all claims and causes of actions for this case.

McCain’s timely acceptance of the offer triggered the entry of

a $3,000 judgment in her favor.

Shortly thereafter McCain filed a Petition for Taxation of

Costs of $150 and a Petition for Attorney Fees of $7,652.50.

After the parties had briefed the issues, the district court ruled

4 McCain v. Detroit II Auto Finance, et al. No. 03-1270

2

By sheer chance the writer of this opinion was the trial judge in

Marek who ruled in defendants’ favor there (547 F. Supp. 542, 547 (N.D.

Ill. 1982)), a decision that was then reversed on appeal (720 F.2d 474,

against McCain in both respects. This timely appeal ensued

after the subsequent entry of a final judgment of dismissal.

RULE 68 AND MAREK v. CHESNY

For purposes of this appeal Rule 68 is just as important for

what it does not say as for what it says (emphasis added):

At any time more than 10 days before the trial begins, a

party defending against a claim may serve upon the

adverse party an offer to allow judgment to be taken

against the defending party for the money or property or

to the effect specified in the offer, with costs then

accrued. If within 10 days after the service of the offer

the adverse party serves written notice that the offer is

accepted, either party may then file the offer and notice

of acceptance together with proof of service thereof and

thereupon the clerk shall enter judgment. An offer not

accepted shall be deemed withdrawn and evidence

thereof is not admissible except in a proceeding to

determine costs. If the judgment finally obtained by the

offeree is not more favorable than the offer, the offeree

must pay the costs incurred after the making of the offer.

Thus the Rule plainly speaks of the consequences of

acceptance or rejection of an offer on the award of costs, but

it is totally silent on the subject of attorney’s fees.

Hence the only way in which Rule 68 directly implicates

awards of attorney’s fees is in situations where such fees are

made an element of “costs”--whether by statute (42 U.S.C.

§ 1988 is the most familiar example) or as a matter of

contract. And it was in the former respect that the Supreme

Court addressed Rule 68 in the seminal decision that basically

controls this case, Marek v. Chesny, 473 U.S. 1 (1985).2
No. 03-1270 McCain v. Detroit II Auto Finance, et al. 5

478-79 (7th Cir. 1983)) but was then in turn upheld by the Supreme

Court’s reversal of the Seventh Circuit.

3

Detroit II does not really contest that ruling. Its briefs on appeal do

not even broach that topic, and its counsel conceded during oral argument

that Detroit II was willing to pay McCain her $150 in taxable costs.

Here is what Marek, id. at 6 (citation omitted) said on the

subject of Rule 68 offers and costs:

If an offer recites that costs are included or specifies an

amount for costs, and the plaintiff accepts the offer, the

judgment will necessarily include costs; if the offer does

not state that costs are included and an amount for costs

is not specified, the court will be obliged by the terms of

the Rule to include in its judgment an additional amount

which in its discretion, it determines to be sufficient to

cover the costs. In either case, however, the offer has

allowed judgment to be entered against the defendant

both for damages caused by the challenged conduct and

for costs. Accordingly, it is immaterial whether the offer

recites that costs are included, whether it specifies the

amount the defendant is allowing for costs, or, for that

matter, whether it refers to costs at all.

And consistently with that teaching, Detroit II’s silence on the

subject of costs in its Rule 68 offer means that true costs are

recoverable by McCain, so that the district court erred in

disallowing them.3

But because Rule 68 itself speaks only of “costs” as such

and not in terms of “attorney’s fees,” Marek, id. at 9 spoke to

the latter subject solely in terms of the former:

In other words, all costs properly awardable in an action

are to be considered within the scope of Rule 68 “costs.”

Thus, absent congressional expressions to the contrary,

where the underlying statute defines “costs” to include

6 McCain v. Detroit II Auto Finance, et al. No. 03-1270

attorney’s fees, we are satisfied such fees are to be

included as costs for purposes of Rule 68.

Nothing in the opinion speaks to any relationship between a

Rule 68 offer and the awarding of attorney’s fees that are not

categorized as “costs.”

When these things are understood, the resolution of this

case is straightforward. As already stated, because

Detroit II’s Rule 68 offer was silent as to “costs then

accrued,” the district court should have included in its

judgment the amount of those costs (agreed by the parties to

be $150). But because none of the statutes that McCain’s

Amended Complaint sought to call into play, and none of the

common law claims that McCain sought to advance, treats

potentially awardable attorney’s fees as “costs,” the Detroit II

offer--which expressly embraced “all claims and causes of

action for this case” (essentially echoing McCain’s own

terminology when she began page 1 of her multicount

Amended Complaint with “Rebekah McCain states the

following claims for relief”)--leaves no room for a post-offer

effort by McCain to collect attorney’s fees.

All of the post-Marek cases that have had to wrestle with

the type of claim that McCain advances here have addressed

Rule 68 offers from the perspective of whether or not those

offers have some greater or lesser degree of ambiguity or

perceived ambiguity (see, e.g., Goodheart Clothing Co. v.

Laura Goodman Enters., Inc., 962 F.2d 268, 272-73 (2d Cir.

1992); Nordby v. Anchor Hocking Packaging Co., 199 F.3d

390, 392 (7th Cir. 1999); Hennessy v. Daniels Law Office,

270 F.3d 551, 553-54 (8th Cir. 2001); Nusom v. Comh

Woodburn, Inc., 122 F.3d 830, 833 (9th Cir. 1997) and Utility

Automation 2000, Inc. v. Coctawhatchee Elec. Coop., Inc.,

298 F.3d 1238, 1242 (11th Cir. 2002)). But here it is

unnecessary to parse or to seek to distinguish among those

cases, for there is no ambiguity in the Detroit II offer and in

McCain’s unequivocal acceptance of that offer, an issue that
No. 03-1270 McCain v. Detroit II Auto Finance, et al. 7

4

Again by sheer coincidence, the writer was also the district judge in

Nordby, this time being affirmed by the Court of Appeals.

is to be resolved under ordinary contract principles (Mallory

v. Eyrich, 922 F.2d 1273, 1279-80 (6th Cir. 1991)).

On that score McCain can draw no comfort from Marek’s

decision as to the potential awardability of attorney’s fees

when based on such fees’ inclusion in the term “costs.”

While all four of the statutes cited in McCain’s Petition for

Attorney Fees do allow for the recovery of attorney’s fees

under specified circumstances, not one does so by

encompassing such fees within “costs” (15 U.S.C.

§ 1640(a)(3); 15 U.S.C. § 1691e(d); Mich. Comp. Laws

§ 445.911(2); Mich. Comp. Laws § 445.1861(1)(d)). To the

contrary, those statutes either list attorney’s fees and costs as

two separate elements of recovery or (in the case of the

Michigan Consumer Protection Act) do not refer to costs at

all. Nor is there any Michigan common law doctrine that

treats attorney’s fees, when they are awardable, as an element

of “costs.” Thus the situation before us parallels the one that

we dealt with in Oates v. Oates, 866 F.2d 203, 205, 208 (6th

Cir. 1989), and as in Oates no award of McCain’s attorney’s

fees may be made under the rubric of Rule 68 “costs.”

Our conclusion as to the absence of ambiguity in the

Detroit II offer, unqualifiedly accepted by McCain as it was,

echoes the Seventh Circuit’s comparable determination in

Nordby.

4

 There the defendant’s Rule 68 offer was for “one

total sum as to all counts of the amended complaint”

(remember that in this case the offer expressly embraced “all

claims and causes of action for this case”). There “[o]ne of

those counts specified attorneys’ fees as part of the relief

sought” (id. at 392), while here all of McCain’s claims for

relief specified attorney’s fees as part of what she was seeking

to recover. And there the Seventh Circuit held “That relief

[the request for attorney’s fees] was covered by the offer”

(id.) and therefore “agree[d] with the district judge that there

8 McCain v. Detroit II Auto Finance, et al. No. 03-1270

was no ambiguity” (id. at 393). That might well have been

written for this case, and we so hold. As in Nordby, there is

no room here for the application of the doctrine of contra

proferentem or for any other predicate for injecting ambiguity

where none exists. Just as with all other contracts, when an

unequivocal and unambiguous offer is responded to by an

acceptance that does not depart from the terms of that offer,

the prototypical enforceable bargain results.

One final note should be added. We have deliberately

eschewed offering advice to counsel generally, as McCain has

requested, as to how Rule 68 offers and acceptances should be

shaped. As we have said, such offers and their acceptance

involve nothing more than applying the basic principles of

contract law. In this instance the absence of ambiguity stems

from Detroit II’s counsel having taken McCain’s counsel at

his word: In response to a complaint that spoke expressly in

terms of “claims for relief” and that also asked expressly for

attorney’s fees to be granted as an integral part of the relief

sought for those claims, a Rule 68 offer that mirrored that

language by tendering $3,000 for “all claims and causes of

action” should have left McCain’s counsel free from doubt.

To be sure, there are other situations in which a prudent

defense counsel, who after all has total control over the

drafting of a Rule 68 offer, ought to (or sometimes must) add

a specific reference to the inclusion of attorney’s fees to

provide clarity--but this is not one of them.

CONCLUSION

Nothing in the terms of Detroit II’s Rule 68 offer justified

McCain’s effort to have the tail wag the dog by seeking an

attorney’s fees recovery of fully two and one-half times the

amount of the substantive judgment. For the reasons we have

stated, we AFFIRM the district court’s rejection of that

claim, while we REVERSE the denial of McCain’s request

for an award of $150 in true costs. Each party shall bear her

or its costs on appeal.