legal services were performed for anyone other than Devcom, Golden's client. The Court finds that these charges were reasonable and necessary for Golden's representation of Devcom.
The Court finds that the evidence supports the conclusion that the legal services charged to Devcom were necessary and reasonable and sufficiently documented. Therefore, the Court awards $ 165,562.50 as attorneys' fees.
It is well settled that courts enjoy broad discretion when determining whether expenses claimed by a prevailing party are taxable as costs. Weihaupt v. American Medical Ass'n., 874 F.2d 419, 430 (7th Cir. 1989). However, this discretion is not without some guidelines, and, in order for a district court to award costs, the court must determine that the expenses are allowable and that they are reasonable and necessary to the litigation. Weihaupt, 874 F.2d at 430; Dickinson v. Indiana State Election Bd., 817 F. Supp. 737, 751 (S.D. Ind. 1992).
Devcom seeks a total of $ 12,976.80 as costs of the litigation from the District Court to the Seventh Circuit to the U.S. Supreme Court. Of those costs, $ 8,385.14 was directly borne by Devcom and $ 4,431.96 was expended by Bruce Golden ("Golden") as Devcom's attorney on its behalf. NLFC contends that these costs are not taxable on procedural and substantive grounds.
Procedurally, NLFC asserts that Devcom has failed to comply with the appropriate rules. Specifically, NLFC claims that Devcom did not file the appropriate Bill of Costs needed to recover costs under FED. R. CIV. P. 54 within the required 30 days after judgment as set forth in Local Rule 45(a). Further, NLFC suggests that the affidavits supplied in support of the claimed costs do not comply with 28 U.S.C. § 1924, thus rendering Devcom's claims under § 1920 insufficient. NLFC's procedural arguments have no merit. This petition for costs and fees is brought under § 505. Where cost-shifting is expressly authorized by statute, courts have consistently held that the traditional limitations of Rule 54, and corresponding Local Rule 45, § 1920, and § 1924 do not apply. Dowdell v. City of Apopka, Florida, 698 F.2d 1181, 1188 (11th Cir. 1983), citing Wheeler v. Durham City Bd. of Ed., 585 F.2d 618, 623 (4th Cir. 1978). Consequently, NLFC's challenge is denied.
Substantively, NLFC makes specific challenges to certain items claimed as costs. Devcom contends that the word "full" in § 505 must be read to expand the court's authority to allow for the award of costs beyond those taxable costs normally awarded a prevailing party under § 1920. The Court disagrees with Devcom's interpretation. See Steven's Linen Associates, Inc. v. Mastercraft Corp., Copy. L. Rep. (CCH) P25,229, 1981 WL 1426 (S.D. N.Y. 2/17/81). Caselaw interpreting 17 U.S.C. § 116 (1970) (repealed), the precursor of § 505, has never accorded courts more discretion because of the word "full." In fact courts have always had authority under FED. R. CIV. P. 54(d) to tax costs not specifically enumerated in § 1920. However, the Supreme Court has consistently admonished that such discretion should be "sparingly exercised with reference to expenses not specifically authorized by statute." Farmer v. Arabian American Oil Co., 379 U.S. 227, 235, 85 S. Ct. 411, 419, 13 L. Ed. 2d 248 (1964). The Court must therefore address each of the enumerated costs claimed by Devcom to determine if costs not specifically covered by § 1920 are reasonable and necessary in this case.
Devcom claims $ 6,312.53 in photocopy expenses of which $ 3,822.53 was incurred by Devcom for "third party xeroxing of documents requested by NLFC in discovery and Bates stamping of the same," $ 900.00 was also incurred by Devcom for in-house xeroxing of documents," and $ 1,590.00 was borne by Golden for "copies of filings in Court." NLFC asserts that these charges do not provide sufficient documentation in that they fail to show what was copied or that said copies were necessary for use in this case.
Courts have long permitted taxation as costs those sums expended for exemplification and copies of papers necessarily obtained for use in the case so long as the per copy charge is reasonable. Voight v. Subaru-Isuzu Automotive, Inc., 141 F.R.D. 99, 103 (N.D. Ind. 1992). Included in the category of costs "reasonably necessary for use in the case" are copies attributable to discovery and the court's copies of pleadings, motions and memoranda; however, extra copies for the convenience of the attorneys are considered not necessary and are not taxed as costs. Voight, 141 F.R.D. at 103. Independence Tube Corp. v. Copperweld Corp., 543 F. Supp. 706, 722 (N.D. Ill. 1982) (extra copies of filed papers and correspondence, and copies of cases not recoverable) . The party seeking such costs must provide the court with a breakdown of the copying charges ( Levka v. City of Chicago, 107 F.R.D. 230, 231 (N.D. Ill. 1985)), but this breakdown need not be so detailed as to render it economically impossible to recover the costs. Northbrook Excess, 924 F.2d at 643. Generally, however, when the Court is unable to determine whether the copies in question were reasonably necessary for use in the case, the claim for such costs should be denied. Arachnid, Inc. v. Valley Recreation Products, Inc., 143 F.R.D. 192, 194 (N.D. Ill. 1992); Voight, 141 F.R.D. at 102.
In addition, courts have denied claims for costs where the per page cost and number of copies is inadequately identified. See Commercial Credit Equipment Corp. v. Stamps, 920 F.2d 1361, 1367 (7th Cir. 1990) (allowing photocopy costs where an "affidavit identifies the documents, justifies the use and provides the cost and the amount of copies."). Thus, caselaw is clear that whether copies are recoverable as costs depends on the use of the copies. Arachnid, 143 F.R.D. at 192. The phrase 'for use in the case' has been interpreted by the Seventh Circuit to refer to materials actually prepared for use in presenting evidence to the court. E.E.O.C. v. Kenosha Unified School Dist. No. 1, 620 F.2d 1220, 1227-28 (7th Cir. 1980).
Considering the photocopy expenses claimed in this case in light of the above caselaw, it is clear that at least a portion of these costs have not been adequately supported. First, Devcom's claim for $ 3,822.53 for third party xeroxing and preparation of discovery material: Giving Devcom the most liberal consideration, we find it entitled to $ 2,630.20 for the cost of preparing and copying one set of discovery material since Devcom fails to address why three copies were necessary.
Next, Devcom's claim for $ 900.00 of in-house xeroxing of 15,000 copies at $ .06: Devcom fails to identify what documents were copied or that such documents were used in the case, therefore, these costs will be denied.
Finally, Golden's $ 1,590.00 claim for copying of court filings: This charge initially concerns the Court because, from the information provided (Petitioner's Exhs. 2, 3 and 5), the reproduction charges actually total $ 1,379.20. In addition, there is insufficient support for any of Golden's photocopy expenses. There is no indication how many copies of court filings were made or at what price per copy, nor does he indicate if any of the $ 159.70 reimbursed by NLFC under the Seventh Circuit's Bill of Costs pertained to photocopy costs. The Seventh Circuit has held that in-house copying may not exceed charges by an outside print shop, and since the evidence does not allow the court to make such a determination in this case, the charge must be disallowed. See Martin v. U.S., 931 F.2d 453, 455 (7th Cir. 1991) (appeals court remanded to the district court for a determination of whether the in-house copy costs exceeded those of an outside print shop).
Therefore, Devcom will be allowed $ 2,630.20 as reasonable and necessary photocopy expenses.
b. Deposition Costs and Transcripts
Devcom also seeks as costs expenses related to holding depositions and obtaining transcripts. Of those, NLFC objects to the $ 260.00 charge for "holding depositions of James White and Arthur Solloday (no copies ordered)" because Devcom has not shown the depositions were necessary for the case.
Like photocopy costs, deposition charges are generally taxable as long as the deposition in question was necessarily obtained for use in the case. Wolf v. Planned Property Management, 735 F. Supp. 882 (N.D. Ill. 1990). The Seventh Circuit has held that the introduction of a deposition at trial is not a prerequisite, and that the determination of necessity must be made in light of the facts known at the time of the deposition. Hudson v. Nabisco Brands, Inc., 758 F.2d 1237, 1243 (7th Cir. 1985). While costs related to depositions may be assessed, depositions may not be taken merely for the convenience of the attorney or purely investigative in nature. Hudson, 758 F.2d at 1243.
Aside from identifying White and Solloday as "employees of NLFC," Devcom provides no explanation why their depositions were taken. In addition, none of the contents of either deposition was referenced in any material provided to this Court. Presented with this scant evidence, the Court has no way of determining whether these depositions were related to an issue present at the time they were taken. For this reason, the cost of White's and Solloday's depositions is denied.
As for the remaining costs, the Court is satisfied that the expenses related to the remaining depositions were reasonable and necessary and will award costs totalling $ 685.75.
c. Diener and Devcom Expenses
Among the claimed costs are $ 3,578.88 for various expenses related to Diener's "time" and that spent by Devcom employees plus mileage and parking costs incurred by Diener. NLFC asserts that Devcom may not recover the costs for Diener's time because as a party he is not entitled to such fees. The undisputed facts show that Diener has been the president of Devcom since its inception and throughout this litigation. Diener has been the acknowledged corporate representative of Devcom throughout this litigation.
Corporate representatives are generally considered parties whose expenses cannot be recovered. E.E.O.C. v. Sears, Roebuck & Co., 114 F.R.D. 615, 624 (N.D. Ill. 1987); Simmons v. McLean Trucking Co., 100 F.R.D. 61, 63 (N.D. Ga. 1983); and Mastrapas v. New York Life Insurance Co., 93 F.R.D. 401, 406 (E.D. Mich. 1982). However, when a designated representative testifies as a witness, courts have held that he or she is entitled to witness fees under 28 U.S.C. § 1821. See Simmons, 100 F.R.D. at 63. It is undisputed that Diener testified only one day and he is therefore entitled to $ 40.00 as allowed under § 1821. The remaining costs for parking and mileage have not been adequately evidenced and they must be denied.
As for the $ 2,060.18 cost for Diener's time and that of Devcom employees related to the production of discovery documents, Devcom provides no statutory or case law support (nor even any evidence or argument) to support the taxation of this cost. Devcom is the defendant in this suit and as such may not recover for its own internal time associated with preparation or defense.
d. Expert Witness Fees
Devcom seeks $ 825.00 for work and testimony of Robert Schneider ("Schneider"). Schneider was provided by Devcom as an expert witness to support its claim for costs and fees. The law in the Seventh Circuit is clear that, for experts not appointed by the Court, the prevailing party may only recover the statutory amount prescribed in § 1821 and not any additional expert fees unless permitted by specific provision of a fee shifting statute. Bankston v. State of Ill., 60 F.3d 1249, 1257 (7th Cir. 1995); State of Illinois v. Sangamo Construction Co, 657 F.2d 855, 865 (7th Cir. 1981); Lock v. Jenkins, 634 F. Supp. 615, 619 (N.D. Ind. 1986); Independence Tube, 543 F. Supp. at 721. The "correct standard for taxing expert fees is not the amount the expert charged the party nor is the time spent by an expert consulting with attorneys or preparing to testify a taxable cost." Lock, 634 F. Supp. at 619; Independence Tube, 543 F. Supp. at 721. Pursuant to § 1821 and caselaw, Devcom is entitled to recover $ 40.00 for Schneider's one day of testimony. The remaining expenses relating to Schneider are prohibited.
e. Printing Costs
Devcom seeks $ 770.00 as the full cost of printing its brief filed with the Supreme Court. United States Supreme Court Rule 43.3 addresses Supreme Court practice and expressly directs that "expenses of printing briefs . . . are not taxable." See Haroco, Inc. v. American Nat'l Bank & Trust of Chicago, 38 F.3d 1429, 1440 (7th Cir. 1994). Even had Devcom been the prevailing party at the Supreme Court, it would not have been entitled to such costs and this Court will not countenance what amounts to an attempted 'end run' around this rule. Haroco, 38 F.3d at 1440. These costs are therefore denied.
f. Office Supplies and Miscellaneous Expenses
Devcom and Golden seek to have a myriad of general expenses taxed to NLFC including telephone expenses, messenger services, facsimile transmissions, binding charges, postage, ink stamps and cab fare. NLFC objects to these charges as being nontaxable and the Court agrees.
First, telephone charges: Devcom argues that it is entitled to both local and long distance telephone charges under § 505. There is no law to support this contention. In fact the case cited by Devcom, Clark v. Marsh, 609 F. Supp. 1028 (D.D.C. 1985), expressly involved only long distance charges of $ 168.40 where the prevailing party lived on the East Coast and the attorney lived in California. Clark, 609 F. Supp. at 1035-36. Here, while NLFC's counsel is from Texas, thus certainly necessitating some long distance communication, Devcom fails to catalog its long distance charges. In fact at least one court has held that long distance charges are out-of-pocket expenses not taxable as costs. Ezelle v. Bauer Corporation, 154 F.R.D. 149, 155 (S.D. Miss. 1994). The Court has no way of determining what portion of the nearly $ 300.00 in telephone expenses are properly taxable. Therefore, none of these expenses will be allowed.
Second, messenger services, facsimile transmissions, deliveries and postage: Devcom argues that these costs are ordinarily out-of-pocket attorney expenses which are recoverable under § 505 and relies on the holdings in West Virginia University Hospitals, Inc. v. Casey, 499 U.S. 83, 111 S. Ct. 1138, 113 L. Ed. 2d 68 (1991); Heiar v. Crawford County, 746 F.2d 1190 (7th Cir. 1984); Doe v. Village of Crestwood, Ill., 764 F. Supp. 1258 (N.D. Ill. 1991); Deary v. City of Gloucester, 789 F. Supp. 61 (D. Mass. 1992). In each of these cases, certain nonstatutory expenses, i.e., out-of-pocket expenditures of the attorney beyond normal overhead, were awarded as part of the attorneys' fee pursuant to § 1988, even though they were listed separately from the hourly rate. See Dickinson, 817 F. Supp. at 752; Doe, 764 F. Supp. at 1262. In other words, such expenses are recoverable as attorneys' fees - not as costs, and when attorneys' fees have been awarded, the prevailing party is then only entitled to recover costs specifically enumerated under § 1920. Allen v. Freeman, 122 F.R.D. 589, 591 (S.D. Fla. 1988).
Since this Court has previously granted a generous attorneys' fee award, these expenses, clearly not taxable under § 1920, are not allowable. However, even considering these expenses as part of the attorneys' fee award, this Court finds them not proper. Devcom fails to provide any evidence that these expenses were reasonable or necessary for this litigation or that certain expenses were beyond normal overhead. See Wahl v. Carrier Manufacturing, Inc., 511 F.2d 209, 215-17 (7th Cir. 1975); Agola v. Hagner, 678 F. Supp. 988, 996 (E.D. N.Y. 1987) (disallowing messenger services, federal express deliveries and postage); Hollenbeck v. Falstaff Brewing Corp., 605 F. Supp. 421, 439 (E.D. Mo. 1984) (denying as costs federal express and local delivery service, office expenses and postage). Therefore, the Court denies Devcom's claims for messenger services, federal express deliveries, postage and facsimile transmissions.
Third, ink stamps, binding costs, court fees and cab fare. Once again Devcom argues that these expenses are the type of out-of-pocket expenses allowed as fees yet provides no caselaw for support. As for the ink stamps and binding charges, these costs can only be classified as office expenses which, as discussed above, should not be awarded in light of the large attorneys' fees granted. As for cab fare, the Court is first puzzled by inconsistent pleadings wherein Devcom first seeks $ 15.00 (Devcom Proposed Findings of Fact, p. 31) and then claims $ 10.00 (Devcom Reply, p. 14, PP 6-7). In any event the charge appears on the April 1994 invoice, a month in which the only legal services performed were the preparation and filing of the appellate brief, so the Court can only assume that this is not the type of travel expense allowable as costs.
Finally, the court fees. Devcom fails to explain what fees it incurred as Defendant in this case. Absent such an explanation, this Court will not award these fees as costs.
g. Transcript and Tapes
Devcom seeks to have charges for the fee hearing tapes and a copy of the transcript taxed as costs. The Court finds this cost permissible as a reasonable and necessary expense for prosecution of the fee petition. Therefore, the Court allows $ 388.50.
h. Total Cost
For the above mentioned reasons the Court now awards the following $ 3,784.45 as costs for this action:
Deposition costs 685.75
Diener witness fee 40.00
Schneider witness fee 40.00
Transcript and tapes 388.50
For all of the above mentioned reasons, this Court finds that Devcom has established its entitlement to costs and fees under § 505 as prevailing party and further finds that Devcom has proven that attorney's fees in the amount of $ 165,562.50 and costs in the amount of $ 3,784.45 are reasonable and necessary. The Court therefore recommends an award of fees and costs in the amount of $ 169,346.95.
Dated: September 29, 1995.
MARTIN C. ASHMAN
United States Magistrate Judge
Written objections to any finding of fact, conclusion of law, or the recommendation for disposition of this matter must be filed with the Honorable George W. Lindberg within ten (10) days after service of this Report and Recommendation. See FED. R. CIV. P. 72(b). Failure to object will constitute a waiver of objections on appeal.