United States District Court, W.D. Oklahoma
GAEDEKE HOLDINGS VII LTD and GAEDEKE OIL & GAS OPERATING, LLC, Plaintiffs,
TODD BAKER; BAKER PETROLEUM AND INVESTMENTS, INC.; and LANDON SPEED, Defendants.
STEPHEN P. FRIOT UNITED STATES DISTRICT JUDGE
29, 2019, the clerk of the court taxed costs in the amount of
$22, 537.64, in favor of the plaintiffs Gaedeke Holdings VII,
Ltd., and Gaedeke Oil & Gas Operating, LLC. Doc. no. 892.
(For convenience, these parties will be referred to as
“plaintiff” in the singular.) Defendant Baker
Petroleum and Investments, Inc. (BPI) also filed a bill of
costs with the clerk. The clerk taxed zero costs in favor of
BPI, having concluded that BPI is not a prevailing party.
Doc. no. 893.
motions are now before the court in relation to the
clerk's taxation of costs. Defendants Todd Baker, BPI and
Landon Speed move to retax costs, asking the court to
disallow all of plaintiff's costs awarded by the clerk
and to tax no costs in this case. Alternatively, if the court
awards costs to plaintiff, then defendants ask the court to
award BPI its costs incurred in defending plaintiff's
claims, seeking $9, 665.10. Doc. no. 894. Plaintiff did not
respond to defendants' motion to retax costs. Plaintiff,
however, moved separately, asking the court to confirm the
clerk's decision on plaintiff's bill of costs. Doc.
no. 895. In that motion, plaintiff rebuts defendants'
arguments for retaxing costs. Accordingly, the court will
permit that motion to serve as plaintiff's response to
defendants' motion to retax costs. In addition,
plaintiff's motion asks the court to confirm the
clerk's taxation of $22, 537.64 in costs in favor of the
plaintiff. Defendants responded to plaintiff's motion.
Doc. no. 897. No. reply brief was filed.
make several arguments for retaxation of costs, all of which
are rejected for the reasons stated below.
Defendants argue that under 28 U.S.C. § 1332(b), the
court should disallow all costs in favor of the plaintiff and
should tax costs in favor of BPI. Section 1332(b) provides
that if a “plaintiff who files a case originally in the
Federal courts is finally adjudged to be entitled to recover
less than the sum or value of $75, 000, … the district
court may deny costs to the plaintiff and, in addition, may
impose costs on the plaintiff.” Thus, the statute gives
the district court discretion with respect to a decision to
deny costs under §1332(b).
court, in the careful exercise of its discretion, will not
deny plaintiff its costs under § 1332(b). As shown by
the result at the first trial, plaintiff's potential
recovery in this action warranted treating this case as one
with an amount in controversy well in excess of the
jurisdictional amount, justifying a major commitment of
effort (with associated costs). Also, as evidenced by the
result at the first trial, there is no reason to think that
plaintiff deliberately inflated the reasonable value of its
claim or that plaintiff was acting other than in good faith
when it invoked diversity jurisdiction. Furthermore, despite
the limited amount of plaintiff's recovery, the interest
at stake in plaintiff's successfully prosecuted claim-the
sanctity of trade secrets-is not a trivial one. These
considerations make it inappropriate to deny plaintiff its
costs under § 1332(b).
Defendants argue the court should deny plaintiff an award of
costs based on the limited success achieved by plaintiff in
this action. Defendants cite Howell Petroleum Corp. v.
Samson Resources, 903 F.2d 778 (10th Cir.
1990). In Howell, the district court found plaintiff
was the prevailing party but exercised its discretion to deny
costs. The court of appeals affirmed, stating “the
court was within its discretion to refuse to award costs to a
party which was only partially successful.”
Id. at 783. Howell makes clear that a
district court, in the exercise of its discretion, may
decline to award costs to a prevailing party where that is
the appropriate result. In this case, however, that is not
the appropriate result. For the same reasons which have been
stated for rejecting defendants' § 1332(b) argument,
the court rejects defendants' argument that plaintiff
should be denied costs based on the limited success plaintiff
achieved in this action.
Defendants argue that no costs should be taxed against BPI
because the second jury awarded plaintiff zero dollars
against BPI. Defendants contend that under Oklahoma
law, an element which must be proven in a trade secret
misappropriation case is that the misappropriation caused
plaintiff actual loss or caused defendant to be unjustly
enriched. Defendants argue that because no damages
were awarded against BPI by the second jury, BPI was a
prevailing party on the trade secret misappropriation claim.
argument, if credited by the court (which it is not), would
undercut the first jury's verdict in favor of plaintiff
and against BPI on the misappropriation of trade secrets
claim,  a result not permitted under the Seventh
Amendment. This is because, on a partial retrial, the second
jury must accept all of the first jury's undisturbed
findings; otherwise, the second trial would violate the
reexamination clause of the Seventh Amendment to the United
States Constitution. See generally, Gasoline
Products Co. v. Champlin Refining Co., 283 U.S. 494
(1931) (“Where the practice permits a partial new
trial, it may not properly be resorted to unless it clearly
appears that the issue to be retried is so distinct and
separable from the others that a trial of it alone may be had
Miles-LaGrange's order of April 21, 2014, makes clear
that the jury's verdict against BPI on the
misappropriation of trade secrets claim stands undisturbed.
As the judge stated in that order, the earlier judgment was
vacated “as to damages only.” Doc. no. 540, p. 5.
“The portion of the [earlier] Judgment whereby the
Court orders that judgment should be entered in favor of
plaintiffs and against defendants David Mills, Landon Speed,
Jim Ashford, Baker Petroleum and Investments, Inc., Todd
Baker, and Mayhem Oil & Gas, Inc. is not vacated.”
Id., p. 5, n.3.
according to defendants' version of events, they argued
to Judge Miles-LaGrange that a partial new trial was
inappropriate because the issues of damages and liability
were inseparable; they lost that argument but did not appeal
Judge Miles-LaGrange's ruling. As they state in their
brief, the judge “overruled Defendants' motion
asserting that a partial new trial was inappropriate on that
basis.” Doc. no. 897, p. 8 of 10. “Defendants do
not dispute that, as a matter of sound legal strategy, they
declined to appeal Judge Miles-LaGrange's decision at the
conclusion of the second trial.” Id.
of these reasons, the court rejects defendants' arguments
that are based on the zero damages award in the second trial.
argues that if costs are taxed at all in this case, then
costs should be taxed in favor of BPI. For the reasons stated
above, the second jury's verdict does not make BPI a
prevailing party. BPI further argues that whether or not the
court determines it is a prevailing party, BPI should be
awarded its costs. For reasons already discussed, there is no
basis in law or fact ...