Bank of America v. Loew's International Corporation

• Decision Date: 25 June 1958
• Citation: 163 F. Supp. 924
• Parties: BANK OF AMERICA, National Trust & Savings Association, Enterprise Productions, Inc. and Sunset Securities Company, Plaintiffs, v. LOEW'S INTERNATIONAL CORPORATION, Defendant.
• Court: U.S. District Court — Southern District of New York

163 F. Supp. 924

BANK OF AMERICA, National Trust & Savings Association, Enterprise Productions, Inc. and Sunset Securities Company, Plaintiffs, v. LOEW'S INTERNATIONAL CORPORATION, Defendant.

United States District Court S. D. New York.

June 25, 1958.

Schwartz & Frohlich, New York City, for plaintiffs. Myles J. Lane, David H. Horowitz, New York City, of counsel.

Phillips, Nizer, Benjamin & Krim, New York City, for defendant. Louis Nizer, Paul Martinson and Albert F. Smith, New York City, of counsel.

DAWSON, District Judge.

These two motions, brought on by the plaintiffs and the defendant, respectively, pursuant to Rule 54(d), to review the action of the Clerk of the Court in taxing costs in the above-entitled action, raise issues as to whether the expense of the Court Reporter's stenographic transcript of the proceedings is properly taxable as costs, and whether the transportation expenses of witnesses from a foreign country are properly taxable as costs.

The action was one for breach of contract for the distribution and marketing of certain films by the defendant corporation. Originally there were thirteen causes of action in the complaint. As a result of a pre-trial hearing and a pre-trial order, six of the causes of action were dropped and it was determined that only one cause of action (the Thirteenth Cause of Action) should be tried by the court and jury and that following the trial of that cause of action the remaining causes of action should be tried by the court without a jury. The trial of the Thirteenth Cause of Action has been had. It lasted for approximately one month. The principal issue in this trial was whether the defendant devoted its best efforts to the proper marketing and disposition of the motion pictures in Great Britain (referred to throughout the trial as the "Enterprise" films) and made such marketing as complete and efficient as practicable, so that the gross returns from such marketing would be as large as possible. The jury rendered a verdict for the defendant which was duly entered. Thereupon the parties taxed costs and these motions raise the issue as to whether the Clerk's taxation of costs in certain respects was proper.

(1) Stenographic Transcript of the Trial Proceedings

Defendant contends that the stenographic transcript of the trial proceedings was necessary in this action, particularly in light of the great length of the trial and the complexity of the data presented, and of the usefulness of such transcript for the purposes of cross-examination and rebuttal of witnesses, of making motions to strike and to dismiss, and for use in preparing instructions for the jury and preparing summations. Plaintiffs deny that the transcript was necessary and urge that the issue involved in the case was a simple one and that the procurement of a transcript was merely for the convenience of the defendant and that counsel's hand-written notes would have been sufficient to accomplish the above-enumerated purposes. Plaintiffs point out that the transcript was not procured at the request of the Court. However, a copy of the transcript was provided to the Court and the Court found that transcript useful and even necessary in passing upon motions and in preparing the charge to the jury.

Rule 54(d) of the Rules of Civil Procedure, 28 U.S.C.A. provides:

"Costs. Except when express provision therefor is made either in a statute of the United States or in these rules, costs shall be allowed as of course to the prevailing party unless the court otherwise directs. * * *"

Under this rule the courts have been held to have wide discretion in the fixing of costs. Truth Seeker Co. v. Durning, 2 Cir., 1945, 147 F.2d 54; Harris v. Twentieth Century-Fox Film Corp., 2 Cir., 1943, 139 F.2d 571; United States v. Arizona Canning Co., 10 Cir., 1954, 212 F.2d 532; 6 Moore, Federal Practice, Par. 54.70 5.

Title 28 U.S.C.A. § 1920 provides for the taxation of costs for stenographic transcripts. That statute provides:

"§ 1920. Taxation of costs.

"A judge or clerk of any court of the United States may tax as costs the following:

* * * * * *

"(2) Fees of the court reporter for all or any part of the stenographic transcript necessarily obtained for use in the case."

The courts have held under this section that it is within their discretion to determine whether or not the stenographic transcript is "necessarily obtained for use in the case," and this appears to be the reasonable meaning and intent of the language of the statute. See Perlman v. Feldmann, D.C.D.Conn.1953, 116 F.Supp. 102, reversed on other grounds 219 F.2d 173, 50 A.L.R.2d 1134, certiorari denied 1954, 349 U.S. 952, 75 S.Ct. 880, 99 L.Ed. 1277; Kemart Corp. v. Printing Arts Research Lab., 9 Cir., 1956, 232 F.2d 897; Cooke v. Universal Pictures Co., D.C.S.D.N.Y.1955, 135 F.Supp. 480; 6 Moore, Federal Practice, Par. 54.77 7. But cf. Marshall v. Southern Pac. Co., D.C.N.D.Cal.1953, 14 F.R.D. 228.¹ Among the more important factors to be considered are the length and the complexity of the trial and the need of the court and the parties to have a transcript to which they may refer. Cf. Cooke v. Universal Pictures Co., supra; Kowalewski v. Pennsylvania R. Co., D.C. D.Del.1957, 21 F.R.D. 244, with Perlman v. Feldmann, supra; Manley v. Canterbury Corp., D.C.D.Del.1955, 17 F.R.D. 234; Brookside Theatre Corp. v. Twentieth Century-Fox Film Corp., D.C.W.D. Mo.1951, 11 F.R.D. 259, affirmed 194 F.2d 846, certiorari denied 1952, 343 U.S. 942, 72 S.Ct. 1035, 96 L.Ed. 1348. See, also, Kemart Corp. v. Printing Arts Research Lab., 9 Cir., 1956, 232 F.2d 897, 905, 57 A.L.R.2d 1234; Knickerbocker Plastic Co. v. Allied Molding Corp., D.C. S.D.N.Y.1949, 96 F.Supp. 358; Hillside Amusement Co. v. Warner Bros. Pictures Distributing Co., Civ. 50-183 (S.D. N.Y.1954).

The Court believes that in this case it should exercise its discretion to allow the costs of the copies of the transcript furnished to the defendant and to the Court. The trial of this case lasted a period of over four weeks; the trial was complex and the evidence included must testimony as to figures and statistical data, and complicated analyses and interpretations of charts. Witnesses on both sides were frequently questioned regarding testimony previously given by them on matters of specialized and detailed nature—such as the significance of the receipts of a picture in selected theatres or selected areas, as to whether or not release dates had been shifted, and what they actually were. It was very helpful to the Court to have a copy of the daily transcript to be able to review the issues and the testimony and to assist it in preparing its charge to the jury. The Court believes that in a case of this length, complexity and importance the availability of a copy of the transcript to the Court and to the parties was more than a matter of mere convenience, but was a matter of substantial necessity. The availability of the transcript to the parties and to the Court minimized the possibility of much time-wasting disagreement as to what prior witnesses may have said, and the daily transcript was of substantial use to the parties and to the Court and was necessarily obtained for such use. This is not the brief and simple type of case in which the Court and the parties might easily rely upon their memories and upon the notes taken by them during the course of the trial.

Therefore, the Court will allow the costs of the two copies of the transcript which were provided to the Court and to the defendant. However, the Court does not believe that the transcript of the openings and closings to the jury, or of oral argument made on motions to dismiss in the course of the case, were necessarily obtained for use in the case. Resultantly the Court orders that the costs of the transcripts be retaxed to include the costs of the trial transcript with the exception of these pages.

(2) The Expenses of Travel of Defendant's Three English Witnesses

Defendant produced, as witnesses on its behalf at the trial, three residents of Great Britain. These three witnesses were pre-eminently qualified to testify concerning the issues of the case. One witness was David Goodlatte, who was the head of the largest circuit exhibiting motion pictures in the British Isles, and the others were Cecil Maitland and Douglas King, who are executives of M. G. M. Pictures, a subsidiary company of Loew's International in the United Kingdom. King is general sales manager for M. G. M. in Great Britain and had been assistant sales manager during the time of the distribution of Enterprise Films. Maitland is treasurer and director of M. G. M. and is also secretary and director of the New Empire Ltd., which is the Loew's subsidiary that operates the Empire Theatre in London. Maitland additionally is an accountant and had prepared figures and statistics on the distribution of Enterprise and other films in Great Britain. Both of these men had personal knowledge of the facts relating to the distribution of Enterprise Films. Their testimony bore on the essential issue of the case. It was the type of testimony that was necessary if all the facts were to be presented to the jury.

Defendant sought an allowance of costs of $783 for each such witness, being the lowest first-class rate for transporting each of these witnesses from and to England. The Clerk of the Court reduced the allowance of costs in each case to $16 which he computed by granting a traveling allowance for 100 miles each way at the rate of 8¢ per mile.

The statutory provision for allowance of costs provides that there may be taxed as costs

"* * * fees and disbursements for * * * witnesses." 28 U.S.C. A. § 1920(3).

The fees to which a witness is entitled are set forth in § 1821 of Title 28 U.S. C.A. This section provides for a fee of $4 per day and an allowance of 8¢ per mile for going from and returning to his place of residence, with the additional proviso:

"Provided, That in lieu of the

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