Opinion
Case No. A1-04-18.
June 21, 2005
ORDER DENYING DEFENDANTS' MOTIONS FOR COSTS AND ATTORNEYS' FEES
Before the Court are Motions for Attorneys' Fees filed by each of the two defendants, Local Union 1593 and the International Brotherhood of Electrical Workers, on June 1, 2005. Also before the Court are Motions for Costs filed by Local 1593 and the International Brotherhood of Electrical Workers, on June 7, 2005, and May 26, 2005, respectively. The Plaintiff has filed a response opposing the motions. For the reasons set forth below, the Court denies all of the motions.
I. BACKGROUND
The Court has previously detailed the facts of this matter.See Docket No. 73. To summarize, the plaintiff, Michael Carr, is an employee of the Dakota Gasification Company in Beulah, North Dakota. Carr was part of a bargaining unit represented by the International Brotherhood of Electrical Workers Local Union 1593 ("Local 1593") and covered by a collective bargaining agreement. Based on numerous allegations of wrongdoing, Carr served a summons and complaint upon Local 1593 and the International Brotherhood of Electrical Workers ("IBEW"). The complaint included four claims: (1) breach of contract; (2) breach of the duty of fair representation; (3) misrepresentation and reliance; and (4) violations of the North Dakota Labor-Management Relations Act. See Docket No. 1. The Court granted summary judgement as to each count. See Docket Nos. 34, 50, and 73.
II. LEGAL DISCUSSION
Local 1593 and IBEW seek attorneys' fees in the total amount of $138, 230.00 pursuant to 28 U.S.C. § 1927 and the Court's inherent power to sanction bad faith conduct. In addition, Local 1593 and IBEW seek costs in the total amount of $4,026.36 pursuant to Rule 54 of the Federal Rules of Civil Procedure. The Court will address each in turn.
A. ATTORNEYS' FEES 28 U.S.C. § 1927 provides as follows:
Any attorney or other person admitted to conduct cases in any court of the United States or any Territory thereof who so multiplies the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses, and attorneys' fees reasonably incurred because of such conduct.
"Section 1927 warrants sanctions when an attorney's conduct `viewed objectively, manifests either intentional or reckless disregard of the attorney's duties to the court.'" Tenkku v. Normandy Bank, 348 F.3d 737, 743 (8th Cir. 2003) (citingPerkins v. Spivey, 911 F.2d 22, 36 (8th Cir. 1990)). The Eighth Circuit has "indicated that the language of § 1927 appears to require a finding of objectively unreasonable behavior and a finding of bad faith." NAACP v. Atkins, 908 F.2d 336, 340 (8th Cir. 1990). In any event, sanctions imposed in accordance with 28 U.S.C. § 1927, unlike those under Rule 11, are discretionary and not mandatory. Burull v. First Nat. Bank of Minneapolis, 831 F.2d 788, 790 (8th Cir. 1987). The Eighth Circuit has warned that "[b]ecause section 1927 is penal in nature, it should be strictly construed so that it does not `dampen the legitimate zeal of an attorney in representing his client.'" Lee v. L.B. Sales, Inc., 177 F.3d 714, 718 (8th Cir. 1999) (quoting Travelers Ins. Co. v. St. Jude Hosp. of Kenner, La., Inc., 38 F.3d 1414, 1416 (5th Cir. 1994)). Ultimately, "[t]he imposition of sanctions is a serious matter and should be approached with circumspection." O'Connell v. Champion Intern. Corp., 812 F.2d 393, 395 (8th Cir. 1987).
The Court is very familiar with the underlying litigation as well as the attorney(s) against whom sanctions are being sought. Although the litigation may have been ill advised, the attorney's conduct does not rise to the level of misconduct or "bad faith" required by 28 U.S.C. § 1927. The Court has carefully reviewed the entire record and will exercise its broad discretion and will not impose sanctions in this case.
B. COSTS
Rule 54(d)(1) of the Federal Rules of Civil Procedure provides as follows:
Except when express provision therefore is made either in a statute of the United States or in these rules, costs other than attorneys' fees shall be allowed as of course to the prevailing party unless the court otherwise directs; but costs against the United States, its officers, and agencies shall be imposed only to the extent permitted by law. Such costs may be taxed by the clerk on one day's notice. On motion served within 5 days thereafter, the action of the clerk may be reviewed by the court.
Fed.R.Civ.P. 54(d)(1). The Eighth Circuit has explained that Rule 54(d) "represents a codification of the `presumption that the prevailing party is entitled to costs.'" Greaser v. Missouri, 145 F.3d 979, 985 (8th Cir. 1998) (citing Bathke v. Casey's General Stores, Inc., 64 F.3d 340, 347 (8th Cir. 1995)). However, despite the presumption, the district court has significant discretion in awarding costs to the prevailing party. Id. (citing Zotos v. Lindbergh School Dist., 121 F.3d 356, 363 (8th Cir. 1997));see Brisco-Wade v. Carnahan, 297 F.3d 781, 783 (8th Cir. 2002) ("Rule 54(d) gives the district court discretion not to award costs to the prevailing party. . . .").
There is no doubt that Local 1593 and IBEW are each a "prevailing party" within the meaning of Rule 54(d). Nevertheless, the Court in its discretion declines to award costs to either party in this contentious dispute. Much has been made of the fact that the plaintiff, Michael Carr, expended a significant amount of money in pursuit of the underlying litigation. This included Carr being forced to withdraw $20,000 from his retirement account to pay his attorneys to aggressively prosecute this lawsuit. The Court is not inclined to impose any further financial burden upon Michael Carr in fashioning an award under Rule 54. In spite of the presumption, the Court believes that the imposition of costs under the circumstances is unnecessary and unwarranted and would only exacerbate the financial burdens already incurred to date by Carr and all other parties as a result of this lawsuit. The Court, in its discretion, will not award costs to any of the parties. Hopefully, this decision will put an end to the reams of paper and self-serving affidavits that have inundated the Court to date on the subject of an award of costs and attorneys' fees.
The Court gave serious consideration to the innovative proposal for an award of costs and attorneys' fee submitted by Patrick Ward, counsel for Local 1593. See Defendant Local 1593 International Brotherhood of Electrical Workers Reply Brief in Support of Motion for Attorneys' Fees, p. 3. Counsel for Local 1593 suggested a total award of $20,000 which was the amount of legal fees paid by Carr to his attorneys. Local 1593 proposed that one-half of this amount ($10,000) be returned by the Plaintiff's attorneys to Carr and the other one-half ($10,000) be divided equally between IBEW and Local 1593 as a partial return on the costs and fees incurred. However, in the interests of justice and a desire to end the bickering, the Court has chosen to exercise its discretion and not impose any sanctions.
III. CONCLUSION
For the reasons set forth above, the Motions for Attorneys' Fees (Docket Nos. 77 and 79), and the Motions for Costs (Docket Nos. 75 and 81), filed by Local 1593 and IBEW, are DENIED.