United States District Court, N.D. Illinois, Eastern Division
DUAL-TEMP OF ILLINOIS, INC., an Illinois Corporation Plaintiff,
HENCH CONTROL CORPORATION, a California corporation, HENCH CONTROL, INC., a California corporation, and CAESAR-VERONA, INC., a Washington corporation, Defendants.
MEMORANDUM OPINION AND ORDER
SHARON JOHNSON COLEMAN, District Judge.
Before the Court are plaintiff Dual-Temp of Illinois, Inc.'s ("Dual-Temp") motion to quantify interest , Dual-Temp's Bill of Costs , defendants Caesar-Verona, Inc. and Hench Control, Inc.'s ("defendants") Federal Rule of Civil Procedure 68(d) motion for award of costs , defendants' motion to disallow plaintiff's Bill of Costs , and Dual-Temp's motion for instructions and for extension of time . For the reasons that follow, the Court grants in part and denies in part the parties' motions.
Following a bench trial, the Court issued its Memorandum Opinion and Order ("Order") finding in Dual-Temp's favor and against all named defendants. The Court entered judgment in the amount of $113, 500.00 "plus interest accruing and attorneys' fees." (Dkt. 278). When Dual-Temp filed its Motion to Quantify Interest , defendants objected, arguing that the judgment form  denied prejudgment interest. The Court found that there was a discrepancy between the Order and the judgment form that was the result of clerical error. (Dkt. 303.) The Court further found that, in accordance with the practice of the Seventh Circuit, the Court intended to award prejudgment interest to Dual-Temp. ( Id. ) However, because defendants already had filed their appeal of the opinion, order, and judgment, Dual-Temp had to seek leave from the Seventh Circuit before this Court could correct its judgment. ( Id. ) The Seventh Circuit remanded the case back to this Court after finding that an appeal was not ripe because final judgment had not been entered where the Court needed to resolve the issue of quantifying prejudgment interest. Dual-Temp of Illinois, Inc. v. Hench Control, Inc., 777 F.3d 429, 430 (7th Cir. 2015). The parties' various motions related to interest, fees, and costs are now before the Court.
Legal Standard and Discussion
The Court found Dual-Temp's breach of contract claim meritorious and issued a judgment in Dual-Temp's favor in the amount of $113, 500. Dual-Temp argues that, based on the provisions of the contract, the Court should calculate prejudgment interest at a rate of 1.5% per month either from the date that it demanded payment from defendants, January 6, 2009, or the date that Dual-Temp filed its complaint, January 30, 2009.
The decision to award prejudgment interest and the amount of interest to apply are left to the discretion of the Court. United States v. Bd. of Educ. of Consol. High Sch. Dist. 230, Palos Hills, Ill., 983 F.2d 790, 799 (7th Cir. 1993). While Dual-Temp asserts that this Court should look to the contract to quantify the prejudgment interest, "federal courts look to state law to determine the availability of (and rules for computing) prejudgment interest." Medcom Holding Co. v. Baxter Travelnol Labs., Inc., 106 F.3d 1388, 1405 (7th Cir. 1997). In Illinois, the merger doctrine provides that when a judgment based on a contract is obtained, the contract becomes merged into the judgment. See Poilevey v. Spivack, 857 N.E.2d 834, 836 (Ill.App.Ct. 2006). The parties are therefore bound by the judgment. Id. Dual-Temp has not cited and the Court has not found any authority holding that a contractual prejudgment interest rate does not merge with the judgment. In Illinois, the prejudgment interest rate is controlled by the Illinois Interest Act. See 815 ILCS 205/2. Therefore, the Court awards Dual-Temp prejudgment interest at the statutory rate of 5% per annum. Id.
Turning to the question of accrual date, Dual-Temp asks for the prejudgment interest rate to be calculated from January 6, 2009, the date they demanded payment from defendants. "[P]rejudgment interest typically accrues from the date of loss or the date on which the claim accrued" in order to "put a party in the position that it would have been in had it been paid immediately." Am. Nat. Fire Ins. Co. v. Yellow Freight Sys., Inc., 325 F.3d 924, 935 (7th Cir. 2003); see also Milwaukee v. Cement Div., National Gypsum Co., 515 U.S. 189, 195 (1995) ("The essential rationale for awarding prejudgment interest is to ensure that an injured party is fully compensated for its loss"). Here, Dual-Temp's claim accrued on the date of its demand. Assessing suffered loss from non-payment on the demand date to the date of judgment would put Dual-Temp in the position it would have been had defendants made immediate payment on demand. Thus, the Court finds that prejudgment interest will begin accruing on January 6, 2009 and that prejudgment interest will be compounded. See e.g., Am. Nat. Fire Ins. Co., 325 F.3d at 937-38 (stating that compound prejudgment interest is the norm in federal litigation).
B. Postjudgment Interest
Dual-Temp also seeks $125.14 per day, compounded annually, from October 1, 2014, in postjudgment interest until the judgment, costs, and fees are fully satisfied. "While state law applies to an award of prejudgment interest in diversity suits, federal law governs the award of post-judgment interest in cases such as this one [a diversity suit]." Travelers Ins. Co. v. Transport Ins. Co., 846 F.2d 1048, 1053 (7th Cir. 1988). Pursuant to 28 U.S.C.A. § 1961(a), the postjudgment interest rate shall be determined using the Treasury Bill rate prevailing on September 30, 2014, the date that judgment was entered in a sum certain, and shall be compounded annually. 28 U.S.C. § 1961 (b); see also, Fishman v. Estate of Wirtz, 609 F.Supp. 982, 988-89 (N.D. Ill. 1985) (citing Fed.R.Civ.P. 58 and finding that the district court would award postjudgment interest from the date the court rendered judgment in a sum certain), aff'd on other grounds, rev'd on other grounds, vacated in part 807 F.2d 520. The parties are instructed to submit a proposed order that includes the quantified prejudgment and postjudgment interest consistent with this court's ruling.
Dual-Temp seeks $25, 962.44 in costs from defendants. At the outset, the Court notes that Dual-Temp incorrectly added the amounts listed on its bill of costs and that the proper sum total is $26, 457.44. Defendants argue that this bill of costs must either be entirely disallowed or ...