the Court of Appeals determined that a federal question was
present since an "insured bank" was involved within the meaning
of 12 U.S.C.A. § 632. The present case does not come within the
provisions of the Federal Interpleader Act, 28 U.S.C.A. § 1335
since it appears from the pleadings that the adverse claimants to
the fund are all nationals of China and therefore the essential
jurisdictional element to suits under that Act is not present
here. 28 U.S.C.A. § 1335(a)(1); see Bank of China v. Wells Fargo
Bank, supra, 209 F.2d at page 473.
The jurisdiction of this court rests upon the general
jurisdiction given to district courts under 28 U.S.C.A. § 1332(a)
(2) and Rule 22 of the Federal Rules of Civil Procedure,
28 U.S.C.A. Since jurisdiction depends solely on diversity, the
question of liability must be determined by the law of Illinois.
Erie R. Co. v. Tompkins, 1938, 304 U.S. 64, 58 S.Ct. 817, 82
L.Ed. 1188; Trust Co. of Chicago v. National Surety Corp., 7
Cir., 1949, 177 F.2d 816. In the latter case and in the Danville
case, supra, a thorough exposition is set forth of the Illinois
law prohibiting the assessment of attorney's fees as costs and
the court will not unduly extend this memorandum by setting it
The issue now resolves itself into whether Rule 54(d) of the
Federal Rules of Civil Procedure which grants to the district
court discretion as to the taxing of costs, United States for Use
of Wadeford Electric Co. v. E.J. Biggs Constr. Co., 7 Cir., 1940,
116 F.2d 768, 775, also includes a discretion to assess
attorney's fees even though the applicable state law forbids such
an assessment. It has been held that Rule 54(d) vests a
discretionary power in the court with respect to the allowance of
costs, including attorney's fees, the exercise of which cannot be
curtailed by state legislation. Bank of China v. Wells Fargo
Bank, D.C.Cal., 1952, 104 F. Supp. 59, 65-66; Kellems v.
California CIO Council, D.C.Cal., 1946, 6 F.R.D. 358, 361.
In the exercise of such a discretion, however, the court is
required to consider the state law. Where, as here, the action is
brought under the general jurisdictional provisions of
28 U.S.C.A. § 1332, and where Illinois law discloses a "substantive"
policy in connection with attorney's fees as costs, see Moore's
Fed. Prac., Vol. 6, pp. 1347, 1352 fn., the court concludes that
the item regarding attorney's fees must be denied.
Counsel are requested to submit an appropriate order not
inconsistent with the conclusions hereinabove stated.
© 1992-2003 VersusLaw Inc.