United States District Court, Southern District of New York
April 6, 1999
DLC MANAGEMENT CORP., FREDERICK COHEN, ARNOLD COHEN AND CAROLE HOROWITZ, PLAINTIFFS,
THE TOWN OF HYDE PARK, THE TOWN BOARD OF THE TOWN OF HYDE PARK, THE PLANNING BOARD OF THE TOWN OF HYDE PARK, NANCY ALDEN AND EVELYN CRISPELL, DEFENDANTS.
The opinion of the court was delivered by: Brieant, District Judge.
MEMORANDUM & ORDER
Presently at issue before this Court in this civil rights
action is a motion, brought by the individual plaintiffs,
Frederick Cohen, Arnold Cohen and Carole Horowitz, to review the
Clerk of the Court's taxation of costs on notice in favor of all
defendants for the sum of $41,622.78. For the reasons set forth
below, the Court vacates the award of costs by the Clerk of the
Court, and orders no costs against the plaintiffs.
On February 18, 1999, within the time contemplated by Local
Rule 54.1, defendants filed their bill of costs for an amount of
$52,673.00, with the Clerk of the Court. On March 9, 1999, having
heard opposition by the individual plaintiffs but not plaintiff
DLC Management Corp., the Clerk of the Court taxed the costs in
the reduced amount of $41,622.78 based on oral representations by
defense counsel that certain deposition transcripts, which
defendants had itemized in their bill of costs, were not
necessary to the trial of the case. On March 11, 1999, the
individual plaintiffs filed their motion to review the Clerk of
the Court's award of costs.
Rule 54(d) of the Federal Rules of Civil Procedure provides, in
relevant part: "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." (Emphasis
added). Our Supreme Court has held that, "Rule 54(d) generally
grants a federal court discretion to refuse to tax costs in favor
of the prevailing party." Crawford Fitting Co. v. J.T. Gibbons,
Inc., 482 U.S. 437, 442, 107 S.Ct. 2494, 2497, 96 L.Ed.2d 385
(1987). As Rule 54 creates a strong presumption that the
prevailing party will recover costs, see Mercy v. County of
Suffolk, 748 F.2d 52, 54 (2d Cir. 1984) (award of costs to
prevailing party is rule, rather than exception), the district
court may not deny costs to the prevailing party without
explanation of adequate reasons. 10 James Wm. Moore, et al.,
Moore's Federal Practice 3d §§ 54.101[a] & [b] (March 1999).
This Court's authority to deny costs to a prevailing party upon
a showing that such an award would be inequitable, is inherent in
the equitable powers granted to the district courts pursuant to
Article III of the U.S. Constitution. See Friedman v. Ganassi,
853 F.2d 207, 211 (3d Cir. 1988), cert. denied 488 U.S. 1042,
109 S.Ct. 867, 102 L.Ed.2d 991 (1989); 10 Charles A. Wright,
Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure
§ 2668 (1998).
This Court has presided over this case since its filing on
October 14, 1993. Based on the familiarity with the merits and
trial tactics employed throughout this longstanding and hard
fought litigation, the Court, sua sponte, finds an award of
costs inequitable based on the factual predicate of this case and
The inequity in this case is no more apparent than in the words
of the decision of our Court of Appeals on direct appeal. After
ruling against plaintiffs-appellants as a matter of law, our
Court of Appeals panel made a point to express that they "are
sympathetic to plaintiffs' plight and in no way  sanction or
condone the [defendants'] behavior." DLC Management Corp. v.
Town of Hyde Park, 163 F.3d 124, 131 (2d Cir. 1998).
Additionally, the appellate panel went on to find that "[u]pon
review of the record, it is manifest that plaintiffs were treated
shabbily and unfairly" by the defendants. Id. Seldom does an
appellate panel, having resolved all the
appellate issues before it, go further to express its judicial
conscience as clearly and unequivocally as was done in this case.
This Court is in total agreement with that expression.
Based on this shabby and unfair treatment, and the entire trial
and pretrial record, it is clear that plaintiffs' lawsuit was
brought with the utmost good faith. Plaintiffs' good faith was
further validated by the fact that their Constitutional claim had
to be decided by our Court of Appeals as a "question of first
impression." DLC Management Corp. v. Town of Hyde Park, 163
F.3d at 129.
In addition to our concerns, and that of the Court of Appeals
about the merits of plaintiffs' complaint and the close and
difficult legal issues presented both at trial and on appeal,
another singularly compelling basis for denying costs would be
the practical effect such an award would have in neutralizing the
$39,905.00 sanction against the defendants imposed by Magistrate
Judge Mark D. Fox, for playing fast and loose with the pretrial
production of documents. Our Court of Appeals affirmed this
Court's adoption of the $39,905.00 in discovery sanctions. DLC
Management Corp. v. Town of Hyde Park, 163 F.3d at 137. Allowing
defendants' costs in an amount slightly larger than the sanctions
would trivialize the severity of defendants' misconduct which
Magistrate Judge Fox felt compelled to punish.
For all the foregoing reasons, this Court declines as a matter
of discretion to award costs to parties who have already been
found to have litigated in bad faith. Cf. McFarland v. Gregory
425 F.2d 443 (2d Cir. 1970).
Having declined to award any costs to defendants, this Court
need not reach the subsidiary issue tendered by plaintiffs as to
whether costs if awarded should be equally apportioned against
each plaintiff, with no right to recover the entire amount of
costs from any plaintiff under a theory of joint and several
liability. There is authority to grant this relief. See In re
Air Crash Disaster at John F. Kennedy Int'l Airport on June 24,
1975, 687 F.2d 626, 630 (2d Cir. 1982) (a court, in its
discretion, may apportion costs between parties); 10 Charles A.
Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and
Procedure § 2668 (1998).
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