Financial Disparity Is One Of The Big Factors Weighed.
So you represented defendants which/who successfully obtained summary judgment in a plaintiffs’ wage/hour class action case. You move for recovery of routine costs under Federal Rule of Civil Procedure and 28 U.S.C. § 1920. Question is: Will you get them? Maybe not.
The reason is that district judges have discretion to deny an award of costs to prevailing defendants if such an award would be inequitable in nature. (Stanley v. Univ. of So. Cal., 178 F.3d 1069, 1079-1080 (9th Cir. 1999).) Among the factors to be examined are whether the losing party has limited financial resources; there is a great economic disparity between the parties; the losing party’s case presented an issue of substantial public importance; imposing costs would chill future civil rights litigants; the issues in the case were close, difficult, or of first impression; the prevailing party’s recovery was nominal; and the losing party litigated in good faith. (Ass’n of Mexican-American Educators v. California, 231 F.3d 572, 592 (9th Cir. 2000).)
Two district judges in California used these factors to deny imposing recovery of routine costs on plaintiff cosmetology students suing in class actions where the basis of the suit was that they were employees based on services provided in the cosmetology school’s clinic which is designed to replicate the saloon experience provided to paying clients once they become licensed. Although granting summary judgment on the merits to the involved cosmetology schools and affiliated defendants, District Judge Fischer in Gerard v. John Paul Mitchell Systems and District Judge Chhabria in Benjamin v. B & H Education, Inc. denied defense requests for recovery of routine costs based on the factors set forth above, especially giving weight to the limited financial resources of the plaintiffs.
We also can report that the Ninth Circuit recently resolved the merits issues, finding cosmetology students were not employees under FLSA or California state wage/hour statutes.(See Benjamin v. B & H Education, Inc., 2017 U.S. App. LEXIS 25672 (9th Cir. Dec. 19, 2017).)