* The Honorable Milton I . Shadur, United States Distr ict Judge for the

Northern District of I llinoi s, si tting by designation. 1 RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Six

th Circuit Rul e 206
ELECTRO NIC CIT

ATION: 2004 FED App . 0261P (6th C ir.) File Name: 04a02 61p.06


### UNITED STATES COURT OF APPEALS

FOR THE SIXT H CIR CUIT

_________________ R EBEKAH M C C AIN ,

Plaintiff- Appellant
,

v.
D ETROI T II A UTO F INANCE C ENTER and B ANK O NE , N.A., Defenda nts-Appe llees. X - - - -> , - - - - N No. 03-1270

Appeal from the United States District Court for the E astern D istrict of Michiga n at Detr oit. No. 02-70855—Patrick J. Duggan, District Judge.

Argued: June 18, 2004 Decided and Filed: August 5, 2004
Befor e: GILMAN

and ROGER S, Circuit Jud ges; SHADUR, District Judge. * 2 McCain v. Detroit I I Auto Fina nce, et a l. No. 03-1270

1 Althoug h Mc Cain ’s petition spok e of “atto rney fee s” (and De troit II and the distr ict court f ollowed her lead in that respect), and although the stat utes and cases are all over t he lot (some using t

hat term, others speaking of “attorneys’ fees” and still others of “attorney’s fees” ), we employ the usage in t

he text, as did the Supreme Court in t he Marek case discus sed hereaf

ter. But see Stal

lwor th v . Gr eat er Cl

ev eland Reg ’l Transi t Auth. , 105 F.3d 25 2, 254 n.1 (6th Cir. 1997).

_________________ COUNSEL
ARGUED: Ian B . Lyngk li p, LY NGK LI P & TAUB, Southfield, Michigan, for Appellant. Jason M. Katz, KATZ & KATZ, Southfield, Michigan, for Appellees. ON BRI EF: Ian B. Lyngklip, LYNGKLI P & TAUB , Southfield, Mich igan, for Ap pella nt. J ason M . Katz , KATZ & K ATZ, Southfiel d, Michig an, for A ppellee s.

_________________ OPINION

_________________ MIL TO N I. SHA

DUR, Distr

ict Judge . Rebeka

h McCain (“McCain”) origina

lly brought s

uit agai nst Detro it II

Auto Finance Cen ter ( “Detroit II”) and Bank One, N.A. (“B ank O ne”) in connection with events that took place when she attempted to secure a loan to purchase a vehi cle. Aft er Detroit II ’s tender and McCain’s acceptance of a Fed. R. Civ. P. (“Rule”) 68 offer of judgment had pr oduced a $3,000 judgment in McCain’ s favor, her coun se l pet itioned the District Courtfor an

award o f costs a

nd attorney ’s fees

. 1 That petition wa s d en ie d i n i ts en ti re ty, an d after the stipulated with-prejudice dismissal of McCain’s Second Amended And Supplement edCo mplaint, Mc Cain file d an appe al aga inst Detroit II pursuant to 28 U.S.C. § 1291. We REVERSE the District Court’s denial of an

award o f costsand AFFIRM its denial of an attorney ’s fee award.No. 03-1270 McCain v. Detroit I I Auto Fina nce, et a l. 3

BACKGROUND McCain sought legal redress afte r having experienced numerous difficulties with Detroi t 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 fede ral Trut h in Lending Act (15 U.S.C. § 1640)(Count I) and Equal Credit Opportunity Act (15 U .S.C. § 1691 )(Count I I) a s well as s everal

Michig a n statutes--the Consumer Pr o tection Act (Mich. Comp. Laws § 445.901) (Count I

V), Motor

Vehicle Sales F i nance 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. L aws § 566.301)(Count XII

)-- and also ad

vanc ing some nonstatutory

cla im s (C oun ts VI, V II, VIII and X IV) . Both CountI and

the “Request for Relief” section of the Amended Complaint c ontained

express r equestsfor the award o f costs and attorne y’ s fees, w

ith the Request for Relief doing so as to the bulk of McCain’s claims.
Several months into t

he litiga tion Detr oit II deliver ed this Rule 68 offer to McCain:
NOW COMES, the Defendant, Detroit II Auto Finance Center, Inc., by

and thr ough its attorney , Howard Alan K a tz, and presents the following offer of judg ment pur suant to FRCP 68. The defendant, Detroit II Au t o Fin ance Center, Inc., offe rs to the Plaintiff, Rebeka h McCain, the amoun

t of th ree thousan d dollars ($3000.00) as to all claims and causes of actions for this case.
McCain’s timely acce

ptance of the offer

triggered the entry of a $3,000 judgment in her favor.
S hortl y thereafter McCain filed a Petition for Taxation of Costs of $150 and a

Petition for Attorney Fe es of $7,652.50. After the parties had briefed the issues, the district court ruled 4 McCain v. Detroit I I Auto Fina nce, et a l. No. 03-1270

2 By sheer ch ance the writ er of t his op inion w as the trial ju dge in Marek wh o r ul ed in d ef en dan ts ’ favor

th er e ( 547 F. Su pp. 542 , 5 47 (N.D. Il l. 198 2)), a deci sion

tha t was the n rev erse d on appeal (720 F. 2d 474, against McCain in both respects. This timely appeal ensued after the subsequ

ent entr y of a final ju dgment o f dismissa

l.
RULE 68 AND MAREK v. CHESNY
For purposes of this ap peal Rule 68 is just as important for what it does not say as for what it says (emphasis adde d): At any time more than 10 days befor e the trial begins, a party defendi ng ag ainst a c laim ma

y s erve upon the adverse party an of

fe r to allow judgment to be taken againstthe defending party for the money

or property or to the eff

ectspecified in the offer, with costs then accrued

. If within 10 day s af ter the service of the offer the adver se party

serves w ritten not ice that t he offe r is accepted, either party

may then file the of

fer a nd noti ce of acceptancetogether with proof of service there of and thereupon the cler k sh all en ter judgment. An offer not accepted shall be deemed withdrawn and evidence thereof is not admiss ible exce pt in a pro ceeding

to determine costs

. If the judgment finally obtained by the offeree is not more favorab le th an the offer, the offeree must pay the costsincurred after the making of the offer.
Thus the Rule plainly speaks of the c onsequences of acceptanceor rejection of an offer on the award of costs, but it is totally

silent on the subject of attor ney ’s fees

. Hence the only

way in which Ru

le 6 8 directly implicates awards of attorney ’s fees is in situations where such fees are made an element of “costs”- -whethe r by statute ( 42 U.S.C. § 1988 is the

most famili ar example) or as a matter of contract. And i t was in the for mer resp ect that t

he Supre me Courtaddress ed Rule 68 in the semi nal deci sion that b asically controls this case, Marek v. Chesny , 473 U.S. 1 (1985). 2No. 03-1270 McCain v. Detroit I I Auto Fina nce, et a l. 5

478-79 (7th C ir . 198 3)) but was th en i n turnuphe ld by th e Sup reme Co urt’s reve rsal of the Seve nth Circ uit.
3 De troit II does not

really conte st t

hat ruling. Its br iefs on appeal do not even broach that topic, and it s counsel conceded during oral argument that Detroit II was willing to pay M cCain her $ 150 in taxable costs. Here is what Marek

, id . at 6 (ci

tatio n omi tted) said on the subject o f Rule 68 o ffers a nd costs:
If an offer recites that costs are include d or specifies an amount for costs, an d the plaintiff accepts the offer, the judgment will necessarily

include costs; if the offer does notstate tha

t costs ar e include d and an a

mount for costs is notspecified, the court will be obliged by the terms of the Rule to include in its judgment an additional amount
w hi chin its discr

etion, it de

termines to be suff

icient to cover the co sts. In either case, howe ver, the offer has allowed judgment to be entered against the defe ndant both for damages caused by the challenged conduct

and for costs. Ac co rd in gl y, it is immaterial whether the offer recites that costs are included, whether it specifies the amount the defe ndant is allowing for costs, or, for that matter, w hether i t refers to costs a

t all.
And consiste ntly with that te aching , Detroit II ’s silence on

the subject of costs in its Rule 68 offer means that

true costs are recove rable by McCain, so that t

he distric t court e rred in disallowi ng them. 3

But because Rule 68 itself spea ks o nly of “costs” a s such and not in terms of “attorney ’s fees,” Marek, id . at 9 spoke to the latter subject solely in ter ms of the former:
Inother words, all c osts prope rly awarda ble in an action are to be considered

within the

scope of Rule 68 “costs.” Thus, absent c ong re ss io na l e xp re ss io ns to th e c on tr ar y, where the underlying

statute defines “costs” to include 6 McCain v. Detroit I I Auto Fina nce, et a l. No. 03-1270
attorney’s fees, we are satisfied such fee s are t o be included as costs for purposes of Rule 68. Nothing in the opinion speaks to any rela tionship between a Rule 68 offer

and the awarding of attorney ’s fees that are not categorized as “costs.”
Whenthese things are understood, the resolution of t his cas e is straig

htforwa rd. As alr

eady stated, b ecause Detroit II ’s Ru le 68 offer was silent as to “costs then accrued,”the dist

rict court sho

uld have i

ncluded i n its judgment the amount of those costs (agree d by the part ies to be $150) . Butbecause none of the statutes that McCain’s Amended Complaintsought to call into play, and none of the commonlaw clai

ms that Mc Cain s ought to a dvance , treats potentia lly awardable attorney ’s fees as “ cos ts ,” t he D etr oi t II offer--which expre ssly embrace d “all claims and causes of act ionfor this c ase” (e ssentiall y e choing

McCain’s

o w n termi nolo gy

when she began page

1 of her multicount A mended Complaint with “Rebekah McCain states th e following claims for relief”)--leaves no room for a post-offer effort b y Mc Cain to col lect attorney ’s fees

. All of the post-Marek

cas e s that hav e had to w restle with the type of claim that McCain a dvances here have addressed Rule 68 offers from the perspective of whethe r o r n ot those offers have some greater or lesse r degree o f

ambiguity or perceived ambigu ity (see, e.g. , Go odheart 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); Henness y v. Dani els La w 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 Automatio n 2000, Inc. v. Coctawhatchee Elec. Coop., Inc. , 298 F.3d 1238, 1242 (11th Cir. 2002 )) . But her e it is unnecessary

to p ars e or to se ek to distin guish am ong thos e case s, for there is no ambiguity in the Detroit II

offer and i n McCain’s unequivocal acceptance of that offer, an

issue thatNo. 03-1270 McCain v. Detroit I I Auto Fina nce, et a l. 7

4 Aga in by sheer coincidence, the writer wa s also the district jud ge in Nordby , this ti me be ing affirmed by the C ourt of Ap peals. is to be resolve d under ordinary contrac t principl es (

Mallory v. Eyrich , 922 F.2d 1273, 1279-80 (6th Cir. 1991)). On that score McCain can draw nocomfort from Marek ’s decisionas to the potential awardability of attor ney ’s fees when b ased on such fees’ inclusion in the term “costs.” While all four of the statutes cited in McCain’s Petition for Attorn ey Fees do allow for the recovery of attorney’ s fee s under specified circumstances, not one does so by enc ompas sing such fee s within “c osts” (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 co nt ra ry, those statutes either list attorney’s f ees and costs as two separate

elements of recovery

or (in the

case of th e Michigan C on sumer Protection Act) do not refer to costs at all. Nor is there any

Michigan common law doctrine that treatsattorney’s f

ees, when they

are awardable, as an element of “costs.” Thus the si

tuation be fore us p arallel s the one that we dealt with in Oates v. Oates , 866 F.2d 203, 205, 2 08 (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 am biguity in the Detroit II offer, unqualifiedly

accepted by M cCain as i

t was, echoes the Seventh Circuit’s compara ble determination in Nordby

. 4 There the defendant’s Rule 68 offer was for “ one total sum as to a

ll countso f the ame

nded comp laint” (remember

that in this

case the offer e xpressly embrac ed “all claim s and causes of action for this case”). The re “[o]ne o f those counts specified attorney s’ fees as par t of the relief sought” ( id . at 392), while her

e all of McCa in’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 ther

efore “ agree [d] with

the di stri ct jud ge that there 8 McCain v. Detroit I I Auto Fina nce, et a l. 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 i s no room here for the ap plication of the doctrine of contra proferentem

or for a ny other pre dicate f

or injecting amb iguity where none exists. Just as with all othe r con tracts, when an unequivocal and unam biguous offer is responded to by an acce ptance that does not depart from the terms of that offer , the prototyp ical enf

orceab le barg ain resu

lts.
One final note shoul d be adde d. We have deliber ately eschewed offering advice to counsel g enerally, as McCain has requested, as to how Rule 68 offers and acceptances should be shaped. As we have said, such off ers and their acceptance involve nothing mor e th an applying the basic principles of contract law . In this instan

ce the a bsence o f ambig

uity stems fromDetroit II ’s counsel having taken McCain’sc ounsel at his word: In response to a complaint that

spoke expr

essly in terms of “claims for

relief” and that

also asked expressly for attorney’s fees t o be gr ante d as an integral part of the relief s ought for those claims, a Rule 68 offer that mirrore d tha t langua ge by tendering

$3,000 f or “all claims and causes of action” should have left Mc Cain’s co unsel fr ee from doubt. To be sure, there are other situations in which a prudent defense counsel, who afte

r all has t

otal cont r ol ov er the draftingof

a Rule 68 offer, ought to (or sometimes must) add a specific refer ence to t

he inclus ion of attorney ’s fees to provide c larity

--but this is not one o f them.
CONCLUSION Nothing in the ter ms of Detr

oit II ’s Rule 68 offer justified McCain’s effort t

o have th e tail wag the dog by seeking an attorney’s fees recovery

of fully twoandone-half times the amount of the substantive judgment. For the reasons we ha ve stated, we AFFIRM

the d is trict court’s rejection of that claim, while we REVERSE the den ial of McC ain’s re quest for an award of

$150 in true costs. Each party shall bea

r her or its cost s on appe al.