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SMS Demag Aktiengesellschaft v. Material Sciences Corp.

August 18, 2008

SMS DEMAG AKTIENGESELLSCHAFT, PLAINTIFF,
v.
MATERIAL SCIENCES CORPORATION, DEFENDANT.
TERRONICS DEVELOPMENT CORPORATION, INTERVENOR-PLAINTIFF/COUNTER-DEFENDANT
v.
MATERIAL SCIENCES CORPORATION, INTERVENOR-DEFENDANT/COUNTER-PLAINTIFF



The opinion of the court was delivered by: Michael P. McCUSKEY Chief U.S. District Judge

OPINION

This case is before the court for ruling on the Bill of Costs filed by Material Sciences Corporation (MSC) in which MSC requested costs in the total amount of $7,475.52. SMS Demag Aktiengesellschaft (SMS Demag) and Terronics Development Corporation (Terronics) filed a Joint Response and Opposition to the Bill of Costs (#88). MSC filed a Motion for Leave to File Reply (#91). SMS Demag and Terronics did not file a response so, pursuant to Rule 7.1(B)(2) of the Local Rules of the Central District of Illinois, this court may "presume there is no opposition to the motion." Accordingly, MSC's Motion for Leave to File Reply (#91) is GRANTED. This court has therefore considered the attached Reply and additional supporting documentation. Following this court's careful consideration of the arguments of the parties and the documentation submitted, MSC's Bill of Costs (#79) is allowed, in part, and denied, in part. MSC is hereby awarded costs in the amount of $6,085.77 against SMS Demag and Terronics, jointly and severally.

BACKGROUND

On November 21, 2007, this court entered a lengthy Opinion (#71) which concluded that MSC was entitled to summary judgment against SMS Demag and Terronics regarding their claims against MSC. This court also concluded that MSC was entitled to judgment on its Amended Counterclaim against Terronics.

On May 13, 2008, MSC filed a Motion for Entry of Judgment with Costs (#79). MSC argued that no hearing on damages was necessary regarding its counterclaim. MSC attached a Bill of Costs to its Motion (#79) and asked this court to award costs in the total amount of $7,475.52 against SMS Demag and Terronics. On May 15, 2008, this court entered an Opinion (#80). This court agreed with MSC that a hearing on damages regarding MSC's counterclaim against Terronics was unnecessary. This court concluded that MSC had shown that it was entitled to judgment against Terronics in the total amount of $192,523.95. This court also allowed SMS Demag and Terronics thirty (30) days to file a response to MSC's request for costs pursuant to Rule 54(d)(1) of the Federal Rules of Civil Procedure.

On May 15, 2008, Judgment (#81) was entered which stated that: (1) judgment was entered in favor of MSC and against SMS Demag on SMS Demag's Complaint (#1); (2) judgment was entered in favor of MSC and against Terronics on Terronics' Second Amended Complaint (#54); and (3) judgment was entered in favor of MSC and against Terronics on MSC's Amended Counterclaim (#62) in the total amount of $192,523.95. On June 13, 2008, both SMS Demag and Terronics filed a Notice of Appeal (#82, #83).

On June 16, 2008, SMS Demag and Terronics filed a Joint Response and Opposition to the Bill of Costs (#88). They argued that the Bill of Costs is objectionable because: (1) it is not apportioned by party; (2) it sought costs for transcripts which were not part of the summary judgment proceedings and requested costs for duplicative items; (3) it requested costs which are not allowable; and (4) it was filed in bad faith.

On June 19, 2008, MSC filed a Motion for Leave to Reply (#91). In its attached Reply, MSC responded to the arguments raised by SMS Demag and Terronics and submitted additional documentation.

ANALYSIS

Rule 54(d) provides that "[u]nless a federal statute, these rules, or a court order provides otherwise, costs--other than attorney's fees--should be allowed to the prevailing party." Fed. R. Civ. P. 54(d)(1). The Seventh Circuit has stated that Rule 54(d)(1) creates a strong presumption that the prevailing party will recover costs. See Mother & Father v. Cassidy, 338 F.3d 704, 708 (7th Cir. 2003). This presumption is difficult to overcome, and the court must award costs unless the losing party establishes a sufficient reason to deny costs. Weeks v. Samsung Heavy Indus. Co., Ltd., 126 F.3d 926, 945 (7th Cir. 1997); Washington v. Vill. of Riverside, Ill., 2003 WL 21789000, at *2 (N.D. Ill. 2003). "In general, a court may deny costs for two reasons: 1) the losing party is unable to pay; and 2) the prevailing party engaged in misconduct." Washington, 2003 WL 21789000, at *2, citing Weeks, 126 F.3d at 945.

In taxing costs, this court must consider whether the costs requested are recoverable and whether the amount requested is reasonable. See Majeske v. City of Chicago, 218 F.3d 816, 824 (7th Cir. 2000). Allowable costs in most cases are limited to the categories listed in 28 U.S.C. § 1920. See Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 441-42 (1987); Republic Tobacco Co. v. N. Atlantic Trading Co., 481 F.3d 442, 447 (7th Cir. 2007); Collins v. Gorman, 96 F.3d 1057, 1058 (7th Cir. 1996).

SMS Demag and Terronics first argued that costs should not be allowed in this case because costs have not been apportioned by party so this court "has no means to determine reasonable costs against either party." In its Reply, MSC pointed out that SMS Demag and Terronics cited no case law in support of this argument. MSC argued that, in fact, "[t]he general rule is that any liability for costs is to be joint and several when there are multiple parties on the non-prevailing side." Petit v. City of Chicago, 2003 WL 22339277, at *3 (N.D. Ill. 2003), citing White v. Sundstrand Corp., 256 F.3d 580, 585-86 (7th Cir. 2001). Moreover, "[t]he burden is on the non-prevailing party to show that the general rule should not be applied." Petit, 2003 WL 22339277, at *3. This court agrees with MSC that SMS Demag and Terronics made no argument that the general rule should not apply in this case. This court concludes that SMS Demag and Terronics have not shown that apportionment of costs is necessary. This court therefore concludes that joint and several liability is appropriate. See Petit, 2003 WL 22339277, at *3.

SMS Demag and Terronics next argued that MSC should not be allowed to recover the costs it incurred for deposition transcripts which were not included as exhibits to this court during the summary judgment proceedings. MSC argues that it is not precluded from recovering its costs for these items merely because they were not cited in MSC's motions for summary judgment. This court agrees.

The Seventh Circuit has interpreted 28 U.S.C. § 1920 to include deposition costs, including the costs of deposition transcripts. Cengr v. Fusibond Piping Sys., Inc., 135 F.3d 445, 454 (7th Cir. 1998); Nilssen v. Osram Sylvania, Inc., 2007 WL 257711, at *2 (N.D. Ill. 2007). To award these costs under Rule 54(d), the district court must determine that the costs are reasonable and were necessary to the litigation. See Cengr, 135 F.3d at 454. However, "transcripts need not be absolutely indispensable in order to provide the basis of an award of costs; it is enough that they are 'reasonably necessary.'" Nilssen, 2007 WL 257711, at *2, quoting Barber v. Ruth, 7 F.3d 636, 645 (7th Cir. 1993). Therefore, "simply because the ...


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