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The Medicines Company v. Mylan Inc.

United States District Court, N.D. Illinois, Eastern Division

October 30, 2017

THE MEDICINES COMPANY, Plaintiff,
v.
MYLAN INC., et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          AMY J. ST. EVE, DISTRICT COURT JUDGE

         Defendants Mylan Inc., Mylan Pharmaceuticals Inc., and Bioniche Pharma USA, LLC (collectively, “Mylan” or “Defendants”) move the Court for bill of costs for a sum totaling $276, 193.89 after six years of litigation over two patents. (R. 694.) Plaintiff The Medicines Company (“TMC” or “Plaintiff”) requests that each party bear its own costs or in the alternative that the Court award no more than $88, 315.29 in costs. (R. 705.) For the following reasons, the Court awards Defendants costs in the amount of $217, 632.88.

         BACKGROUND

         The Court assumes the parties' familiarity with the lengthy proceedings in this case. TMC brought this lawsuit on February 23, 2011, for patent infringement for United States Patent Nos. 7, 582, 727 (“the ‘727 patent”) and 7, 598, 343 (“the ‘343 patent”) under the Hatch-Waxman Act. (R. 1.) On June 21, 2013, Defendants moved for summary judgment of non-infringement or, in the alternative, invalidity. (R. 275.) The Court granted Defendants' motion for summary judgment of non-infringement with respect to the ‘343 patent, but denied it with respect to the ‘727 patent. (R. 309.) The Court also denied Defendants' alternative motion for summary judgment of invalidity with respect to the ‘727 patent, however it granted Defendants' motion for summary judgment on TMC's claim for willful infringement. (Id.)

         The Court held a six-day bench trial from June 9 to June 18, 2014, on TMC's infringement claims and Mylan's counterclaims regarding the ‘727 patent. (R. 545, 546, 548, 550, 551, 552.) The Court found that: (1) Mylan had failed to prove by clear and convincing evidence that claims 1-3, 7-10, and 17 of the ‘727 patent are invalid or unenforceable; and (2) Mylan's proposed bivalirudin drug product infringed claims 1-3, 7-10, and 17 of the ‘727 patent. (R. 590.) The judgment was entered on October 27, 2014, (R. 591.) and amended on November 12, 2014 (R. 615.).

         Defendants subsequently appealed and Plaintiffs cross-appealed. The Federal Circuit reversed the Court's judgment of infringement with respect to the ‘727 patent, dismissed TMC's cross-appeal regarding the ‘343 patent, and vacated the Court's injunction against Mylan. (R. 665; see TMC v. Mylan, Nos. 15-1113, 15-1151, 15-1181 (Fed. Cir. July 29, 2015), Dkt. No. 64.)

         Before the Court is Defendant's motion for bill of costs, seeking $276, 193.89 after six years of litigation over the two patents. (R. 694.) Plaintiff opposes the motion and requests either that each party bear its own costs or in the alternative that the Court award no more than $88, 315.29 in costs. (R. 705.)

         LEGAL STANDARD

         Federal Rule of Civil Procedure 54(d)(1) 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); see also Richardson v. City of Chicago, 740 F.3d 1099, 1102 (7th Cir. 2014) (“Rule 54 entitles prevailing parties to recover their costs.”); Goldberg v. 401 N. Wabash Venture LLC, 2013 WL 4506071, *1 (N.D. Ill. Aug. 23, 2013). The list of recoverable costs pursuant to 28 U.S.C. § 1920, includes (1) fees of the clerk and marshal, (2) fees for transcripts, (3) witness fees and expenses, (4) fees for copies of papers necessarily obtained for use in the case, (5) docket fees under 28 U.S.C. § 1923, and (6) compensation for court-appointed experts and interpreters. Harney v. City of Chicago, 702 F.3d 916, 927 (7th Cir. 2012). See also Thompson v. Vill. of Monee, 2016 WL 128005, *1 (N.D. Ill. Jan. 12, 2016), appeal dismissed (Feb. 26, 2016) (referencing U.S. Neurosurgical, Inc. v. City of Chicago, 572 F.3d 325, 333 (7th Cir. 2009); Republic Tobacco Co. v. North Atl. Trading Co., Inc., 481 F.3d 442, 447 (7th Cir. 2007)).

         Rule 54(d)(1) “creates a presumption in favor of awarding costs to the prevailing party, ” Myrick v. WellPoint, Inc., 764 F.3d 662, 666 (7th Cir. 2014), but gives “the district judge discretion to decide whether an award of costs is appropriate.” Chesemore v. Fenkell, 829 F.3d 803, 816 (7th Cir. 2016). See also U.S. Neurosurgical, 572 F.3d at 333; Rivera v. City of Chicago, 469 F.3d 631, 634 (7th Cir. 2006) (Rule 54(d)(1) “provides a presumption that the losing party will pay costs but grants the court discretion to direct otherwise.”).

         “Taxing costs against the non-prevailing party requires two inquiries-whether the cost is recoverable and whether the amount assessed is reasonable.” Artunduaga v. Univ. of Chicago Med. Ctr., 2017 WL 1355873, *1 (N.D. Ill. Apr. 13, 2017). See also U.S. Neurosurgical, Inc., 572 F.3d 325 at 333; Little v. Mitsubishi Motors N. Am., Inc., 514 F.3d 699, 702 (7th Cir. 2008) (per curiam). “Any party seeking an award of costs carries the burden of showing that the requested costs were necessarily incurred and reasonable.” Trs.of Chicago Plastering Inst. Pension Trust v. Cork Plastering Co., 570 F.3d 890, 906 (7th Cir. 2009); see also Little, 514 F.3d at 702. Again, district courts have considerable discretion in determining whether a particular cost is reasonable and necessary. See Myrick, 764 F.3d at 666; U.S. Neurosurgical, Inc., 572 F.3d at 333.

         A bill of costs must be verified per 28 U.S.C. § 1924: “Before any bill of costs is taxed, the party claiming any item of cost or disbursement shall attach thereto an affidavit, made by himself or by his duly authorized attorney or agent having knowledge of the facts, that such item is correct and has been necessarily incurred in the case and that the services for which fees have been charged were actually and necessarily performed.” Typically, parties file a Form AO 133 “Bill of Costs, ” which includes a sworn affidavit, and both an itemization and documentation of the requested costs. Courts analyze costs based on category and review corresponding documentation. See, e.g., Northbrook Excess & Surplus Ins. Co. v. Procter & Gamble, Co., 924 F.2d 633 (7th Cir. 1991) (Seventh Circuit requiring a bill of costs that provides “the best breakdown obtainable from retained records”); Goldberg, 2013 WL 4506071 at *6 (this Court reviewing itemized and documented costs).

         ANALYSIS

         Before the Court is Defendant's motion for bill of costs, seeking $276, 193.89 after six years of litigation over two patents. (R. 694.) Defendants assert that they are the prevailing party because they “won summary judgment of non-infringement of the ‘343 patent and secured a final judgment of non-infringement of the ‘727 patent from the United States Court of Appeals for the Federal Circuit, which reversed this Court's finding of infringement.” (Id. at 1.) Mylan “seeks its taxable costs of $276, 193.89 pursuant to Federal Rules of Civil Procedure 26(b)(4)(E) and 54(d)(1), 28 U.S.C. §1920, and Federal Rule of Appellate Procedure 39(e).” (Id.) Plaintiff opposes the motion and requests either that each party bear its own costs or in the alternative that the Court award no more than $88, 315.29 in costs. (R. 705.)

         I. Prevailing Party

         Plaintiff argues that the Court should exercise its discretion and not award costs because “Mylan lost nearly every counterclaim.” (R. 705 at 5-7.) According to TMC, most of Defendants' requested “costs relate to Mylan's unsuccessful claims.” (Id. at 7.) TMC further argues that a court may weigh the complexity of a case or the closeness of the issues when determining costs. (Id. at 7-8.)

         For the purposes of Rule 54, the prevailing party is “the party who prevails as to the substantial part of the litigation.” First Commodity Traders, Inc. v. Heinold Commodities, Inc., 766 F.2d 1007, 1015 (7th Cir. 1985); see also Cascade Die Casting Grp., Inc. v. Arwood Corp., 923 F.2d 856, *6 (7th Cir. 1991) (quoting First Commodity Traders, Inc. with approval). The party does not have to prevail with regard to all of its claims-it must win only a substantial part of the litigation. “A party prevails for purposes of Rule 54(d) when a final judgment awards it substantial relief.” Smart v. Local 702 Int'l Bhd. of Elec. Workers, 573 F.3d 523, 525 (7th Cir. 2009); see also Testa v. Village of Mundelein, Ill., 89 F.3d 443, 447 (7th Cir. 1996) (“the ‘prevailing party' is the party who prevails as to the substantial part of the litigation”). “[A] determination of who is the prevailing party for purposes of awarding costs should not depend on the position of the parties at each stage of the litigation but should be made when the controversy is finally decided.” Republic Tobacco Co., 481 F.3d at 446 (citation omitted).

         Defendants are the prevailing party in the litigation. Their rights have been vindicated on both patents at the close of the lawsuit. They are thus entitled to costs per Rule 54(d)(1).

         II. Costs for Clerk and Marshal Per 28 U.S.C. § 1920(1) & Appeal Filing Fee Per Fed.R.App.P. 39(e)

         Mylan seeks a total of $1, 076.00 in costs associated with service fees pursuant to 28 U.S.C. § 1920(1) and for the appeal filing fee under Fed.R.App.P. 39(e). Service fees may not exceed the amount charged by the United States Marshal Service, which was a rate of $55.00 per hour at the time of the litigation, as well as any travel costs and out-of-pocket expenses. See Collins v. Gorman, 96 F.3d 1057, 1060 (7th Cir. 1996); see also 28 C.F.R. § 0.114(a)(3) (establishing fees for service of summons; using the rates in effect from December 19, 2008, to October 29, 2013). For nine of the eleven subpoenas, Defendants claim $55.00 per subpoena. They also claim $23.50 and $52.50 for two other subpoenas for a total cost of $571.00. Mylan also requests the $505 appeal filing fee under Fed.R.App.P. 39(e)(4), which allows costs for “the fee for filing the notice of appeal.”

         Exhibit 2 contains Defendants' documentation for the subpoenas and appeal fee. (R. 695-2.) Defendants provide two internal Perkins Coie emails discussing service, nine invoices for subpoenas, and an email confirmation from a government entity for the appellate fee. Plaintiff points out that internal emails cannot take the place of invoices while Defendants underscore that six years have passed from the date of service. The Court finds that the 11/14/2011 internal email from 1:42PM does not adequately document or substantiate the subpoena fee-the email between two Perkins Coie employees does not even specify on whom service was made. (Id. at 3.) The Court will, however, accept the other internal email from 11/14/2011 from 2:03PM. (Id. at 4.) While this is also an email between two Perkins Coie employees, it specifies the entity that will be served. The Court also accepts the nine subpoena invoices. The Court thus awards costs for ten of the eleven subpoenas in the amount of $516.00.

         Plaintiff does not dispute the $505 appeal filing fee. The Court awards Defendants this cost under Fed.R.App.P. 39(e)(4). The Court therefore awards Defendants a total of $1, 021.00 for costs under 28 U.S.C. § 1920(1) and Fed.R.App.P. 39(e).

         III. Costs for Court Reporter and Transcripts Per 28 U.S.C. § 1920(2)

         Mylan seeks a total of $78, 348.38 in § 1920(2) costs: $38, 686.30 in deposition transcript fees, $29, 846.00 in deposition video-recording fees, and $9, 816.08 in trial transcript fees. Plaintiff argues that these costs are excessive and should be reduced.

         Courts award costs for court reporting fees pursuant to § 1920(2), which “allows parties to recover only the transcript expenses that can be considered reasonable, that is, ‘[f]ees for ... transcripts necessarily obtained for use in the case.'” Montanez v. Simon, 755 F.3d 547, 558 (7th Cir. 2014) (quoting 28 U.S.C. § 1920(2)). Courts award deposition charges if the deposition appears reasonably necessary in light of the facts known at the time of the deposition. See Little, 514 F.3d at 702.

         Under Northern District of Illinois Local Rule 54.1(b), the costs of a transcript shall not exceed the regular copy rate established by the United States Judicial Conference. See N.D.Ill.L.R. 54.1(b). Judicial Conference rates for depositions conducted after November 1, 2007 are $3.65 per page for ordinary transcripts (and $0.90 for the first copy), $4.25 per page for fourteen day transcripts (and $0.90 for the first copy), $4.85 per page for seven day transcripts (and $0.90 for the first copy), $6.05 per page for daily transcripts (and $1.20 for the first copy), and $7.25 per page for hourly transcripts (and $1.20 for the first copy). See http://www.ilnd.uscourts.gov/Pages.aspx?rsp2kxYIAI6Z3skP0PESAꭶ휪䟑.

         In addition, attendance fees are recoverable under § 1920(2). See Extra Equipamentos E Exportacao Ltda. v. Case Corp., 541 F.3d 719, 727 (7th Cir. 2008); Little, 514 F.3d at 701-02. These fees include $110.00 for one half-day (four hours or less) and $220.00 for a full day. See Gracia v. Sigmatron Int'l, Inc., No. 11 C 7604, 2016 WL 6892861, at *6 (N.D. Ill. Nov. 23, 2016).

         A. Deposition ...


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