Boyd v. BNSF Ry. Co.

• Citation: 858 N.W.2d 797
• Decision Date: 29 December 2014
• Docket Number: No. A14–0277.,A14–0277.
• Parties: Terry BOYD, Respondent, v. BNSF RAILWAY COMPANY, Appellant.
• Court: Court of Appeals of Minnesota

858 N.W.2d 797

Terry BOYD, Respondent

v.BNSF RAILWAY COMPANY, Appellant.

No. A14–0277.

Court of Appeals of Minnesota.

Dec. 29, 2014.

Review Granted March 25, 2015.

Paula M. Jossart, Christopher J. Moreland, Bremseth Law Firm, P.C., Minnetonka, MN, for respondent.

Timothy K. Masterson, R. John Wells, Karl E. Robinson, Sweeney & Masterson, P.A., St. Paul, MN, for appellant.

Considered and decided by RODENBERG, Presiding Judge; HOOTEN, Judge; and KIRK, Judge.

OPINION

HOOTEN, Judge.

In this appeal from a judgment in a Federal Employers' Liability Act (FELA) action, appellant BNSF Railway Company challenges the district court's award of costs and disbursements to respondent Terry Boyd, arguing that: (1) Minn. R. Civ. P. 68.03(b)(2), which permits enhanced costs based on the rejection of a settlement demand, is preempted by FELA; and (2) the district court abused its discretion by awarding certain expert costs. Because the Minnesota rule is not preempted by FELA and the district court acted within its discretion when awarding expert costs, we affirm.

FACTS

In February 2012, Boyd filed a five-count complaint against BNSF, alleging violations of FELA, 45 U.S.C. §§ 51 –60 (2012) ; the Federal Safety Appliance Act (FSAA), 49 U.S.C. §§ 20301 –06 (2012); and the Locomotive Inspection Act (LIA), 49 U.S.C. §§ 20701 –03 (2012), stemming largely from a March 6, 2011 incident in which Boyd slipped on a ladder and was injured in the course of his employment with BNSF.¹

On January 15, 2013, Boyd made BNSF a settlement offer of $275,000 pursuant to Minn. R. Civ. P. 68.01. This offer was not accepted by BNSF, and the case proceeded to a trial of Boyd's FELA and LIA claims on May 28, 2013.² The jury returned a verdict for Boyd on both FELA claims, finding that BNSF failed to provide Boyd with a reasonably safe workplace and that BNSF's negligence caused injury to Boyd in violation of FELA. The jury found no violation of LIA. The jury awarded Boyd damages in the amount of $610,954.61. The district court granted BNSF's motion for offsets and reduced the award, entering judgment in favor of Boyd for $411,954.98.

After Boyd filed an affidavit of taxation of costs pursuant to Minn. R. Civ. P. 54.04(b), the court administrator taxed $152,537.16 in costs and disbursements against BNSF, which included $62,584.48 under rule 68.03. These costs and disbursements included expert fees in the amount of $37,985.74 for Alan Blackwell and $20,558.66 for Dr. Robert Andres.

BNSF challenged the award with the district court, arguing that the doubling of costs under rule 68.03 is preempted by FELA. The district court held that FELA does not preempt rule 68.03. The district court reasoned that because rule 68.03 “is not meant to make a party whole” and “is not an element of damages initially sought by [Boyd],” its application is unlike that of the prejudgment-interest rule at issue in Monessen Sw. Ry. v. Morgan, 486 U.S. 330, 108 S.Ct. 1837, 100 L.Ed.2d 349 (1988). The district court also distinguished enhanced costs under rule 68.03 from punitive damages available under Minn.Stat. § 549.20, subd. 1(a) (2012). Therefore, the district court held that rule 68.03 could be applied in this action. BNSF also challenged the expert fees taxed by the court administrator. The district court upheld the fees for Blackwell and reduced the fees for Dr. Andres to $10,352.88. With that fee reduction and other cost changes, the district court ultimately taxed BNSF $133,751.12 for costs and disbursements. BNSF challenges this award.

ISSUES

I. Does FELA preempt the doubling of post-offer costs and disbursements pursuant to Minn. R. Civ. P. 68.03 ?

II. Did the district court abuse its discretion by awarding costs and disbursements for the expert fees charged by Blackwell and Dr. Andres?

ANALYSIS

I.

BNSF disputes the district court's award of double costs under Minn. R. Civ. P. 68.03(b)(2), arguing that the doubling of costs is preempted by FELA. “Whether federal law preempts state law is an issue of statutory interpretation, which we review de novo.” Meyer v. Nwokedi, 777 N.W.2d 218, 222 (Minn.2010).

A. Minnesota Rule of Civil Procedure 68.03

Minnesota Rule of Civil Procedure 68.03(b)(2) allows a plaintiff, who serves an offer of settlement on the defendant and wins a judgment greater than that offer, to recover (1) the rule 54.04 costs to which it would otherwise be entitled, and (2) an additional amount equal to its rule 54.04 costs incurred after the date of the offer.³ Rule 68.03 balances this potential reward for plaintiffs with a similar incentive for defendants. If a plaintiff rejects a defendant's offer of settlement and the verdict is in favor of the plaintiff but less favorable than defendant's offer, the defendant is awarded its post-offer costs and does not have to pay plaintiff's costs. Minn. R. Civ. P. 68.03(b)(1). Thus, under this scenario, the defendant effectively receives “double” post-offer costs; the defendant recovers its post-offer costs and is relieved of having to pay the post-offer costs a plaintiff would otherwise be entitled to under rule 54.04. See Minn. R. Civ. P. 68 2008 advisory comm. cmt. (“[U]nder the revised rule, a plaintiff who rejects a Rule 68 offer suffers dual adverse consequences: loss of the right to recover his costs and required payment of the defendant's costs.” (emphasis added)).

B. FELA

FELA provides that “[e]very common carrier by railroad ... shall be liable in damages to any person suffering injury while he is employed by such carrier ... for such injury or death resulting in whole or in part from the negligence” of the railroad. 45 U.S.C. § 51. In creating this right of recovery for railroad workers, Congress “crafted a federal remedy that shifted part of the human overhead of doing business from employees to their employers.” Consol. Rail Corp. v. Gottshall, 512 U.S. 532, 542, 114 S.Ct. 2396, 2404, 129 L.Ed.2d 427 (1994) (quotations omitted). Congress has given state courts concurrent jurisdiction with federal courts over adjudication of FELA claims, 45 U.S.C. § 56, and has prohibited railroad defendants in state courts from removing FELA lawsuits to United States district courts. 28 U.S.C. § 1445(a) (2012). FELA does not expressly address the decision to award costs and disbursements to the prevailing party or the shifting of those costs and disbursements between the parties.

C. Preemption

The Supremacy Clause of the United States Constitution provides that “[t]his Constitution, and the Laws of the United States ... shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.” U.S. Const. art. VI, cl. 2. The Supremacy Clause “invalidates state laws that interfere with, or are contrary to, federal law.” Hillsborough Cnty., Fla. v. Automated Med. Labs., Inc., 471 U.S. 707, 712, 105 S.Ct. 2371, 2375, 85 L.Ed.2d 714 (1985) (quotation omitted).

Determining whether federal law preempts a state law under the Supremacy Clause “starts with the basic assumption that Congress did not intend to displace state law.” Bldg. & Constr. Trades Council v. Assoc. Builders & Contractors of Mass./R.I., Inc., 507 U.S. 218, 224, 113 S.Ct. 1190, 1194, 122 L.Ed.2d 565 (1993) (quotation omitted). This “normal presumption against pre-emption” is “buttressed” when courts act in accordance with a “neutral state Rule regarding the administration of state courts.” Johnson v. Fankell, 520 U.S. 911, 918, 117 S.Ct. 1800, 1805, 138 L.Ed.2d 108 (1997) ; see also Howlett v. Rose, 496 U.S. 356, 372, 110 S.Ct. 2430, 2441, 110 L.Ed.2d 332 (1990) (“States may apply their own neutral procedural rules to federal claims, unless those rules are pre-empted by federal law.”). BNSF thus bears a “heavy burden of persuasion” in arguing that the Minnesota rule is preempted by federal law. Johnson, 520 U.S. at 918, 117 S.Ct. at 1805. As our supreme court has warned, “[p]reemption of state law by federal statute or regulation is not favored in the absence of pervasive reasons—either that the nature of the regulated subject matter permits no other conclusion, or that the Congress has unmistakably so ordained.” Pikop v. Burlington N. R.R., 390 N.W.2d 743, 747 (Minn.1986) (quotations omitted); see also Gretsch v. Vantium Capital, Inc., 846 N.W.2d 424, 433 (Minn.2014) (“We have ... recognized that preemption is generally disfavored.”).

Applying United States Supreme Court precedent, our supreme court has recognized three ways in which federal law may preempt state law: (1) explicit preemption, in the “rare” case where Congress explicitly states that the federal law is meant to preempt “any state action in the field”; (2) implied field preemption, where Congressional intent to preempt state law is inferred either from “the extent of the federal involvement [in the field] or the scope of the federal interest”; and (3) conflict-in-fact preemption, where the federal law makes it impossible to comply with both state and federal law, or “the state law is an obstacle to the accomplishment of the purposes of the federal scheme.” Pikop, 390 N.W.2d at 748.

BNSF does not contend that this case falls under the rubric of explicit preemption. There is no language in FELA explicitly at odds with rule 68.03, and we conclude that this is not the “rare” case in which Congress has “expressly preclude[d] all state law in a given regulatory field.” Id.

Congressional intent to impliedly preempt state law by occupying a legislative field can be inferred “where the scheme of federal regulation is sufficiently comprehensive to make reasonable the inference that Congress left no room for supplementary state regulation.” In re Estate of Barg, 752 N.W.2d 52, 63 (Minn.2008). The Supreme Court has held that FELA occupies the field of personal-injury lawsuits against railroads by railroad workers. See, e.g., N.Y. Cent. & Hudson River R.R. v. Tonsellito, 244 U.S. 360, 361, 37 S.Ct. 620, 621, 61 L.Ed. 1194 (1917) (“...