Opinion
No. 98 C 4786.
October 6, 2000.
MEMORANDUM OPINION AND ORDER
Before this Court is plaintiff David Kelm's motion to be deemed a prevailing party and to recover attorney's fees and costs from defendant Park District pursuant to an Offer of Judgment under Fed.R.Civ. 68.
I. BACKGROUND
When Kelm began working for the Park District as a park groundsman, he received a personnel policy manual outlining the Park District's policy on drug use. The Park District's Manual of Full Time Employee Work Rules and Benefits ("Manual") provides for drug testing in limited circumstances, including when the Park District has reasonable cause to suspect that the employee violated the Park District's drug policy. The Manual also incorporates by reference, the United States Department of Transportation ("DOT") regulations for substance abuse testing.See 49 C.F.R. § 40.23 (d)(1) and 40.23(d)(4)
In 1996, Kelm held a commercial driver's license ("CDL") and his job duties included operating CDL-rated vehicles. As a CDL licensee, Kelm was randomly selected to take a drug and alcohol test in late October 1996. This suit does not challenge the legality of that test. The result of this test revealed minimal traces of illegal drugs. Kelm denied illegal drug use and challenged the test result because, he claimed, the sample in question had been "lost" for three days. A subsequent test of a portion of the specimen, which was "split" for confirmation testing. also came back positive for cocaine. In accordance with the Park District's policy, Kelm was evaluated by a Substance Abuse Professional ("SAP"), who prescribed specific dates for future drug testing.
On March 20, 1997, Kelm passed a random unannounced drug test. Kelm also does not challenge the legality of this test. The results of the March 20 follow-up test showed that the specimen had a specific gravity level of less than 1.003 and a creatinine concentration below 0.2 grams per liter (g/L). Based on these testing results, the Park District concluded that Kelm had altered his March 20, 1996, sample and might alter future tests. Eleven days later, the Park District required Kelm to undergo another drug test. It is this test that is the subject of Kelm's complaint and the remaining counts now before the Court on summary judgment.
The evidence regarding the March 31 test and the inferences to be drawn from such evidence conflict. According to Kelm, when he showed up at the testing site, a female employee stated that she was to observe him providing a urine sample. It is undisputed that Kelm perceived that the female nurse would be the individual who directly observed his test. Based on Kelm's perception of how the test would be conducted, he refused to submit to the test. Kelm phoned his supervisor, Alan Welk, at the Park District to object to the test as he perceived it. He reported that he was too embarrassed to take such a test. Kelm was told that Donna Wilson had insisted that the March 31 test be witnessed but he was not told explicitly that a female would witness the test. Kelm also disputes that reasonable suspicion or valid consent existed to justify the drug test.
Because he refused to undergo testing, the Park District and suspended and eventually discharged Kelm on April 7, 1997. On April 10, and again on November 6, 1997, Kelm unsuccessfully appealed his discharge. Kelm timely filed a charge of discrimination with the Equal Employment Opportunity Commission and brought suit before this Court. He named as defendants the Park District and certain individual defendants in their individual and official capacities in his suit. In response, the Park District and those individual defendants moved to dismiss Counts I though VII of the Kelm's complaint. This Court granted the motion in part and denied it in part. See Kelm v. Arlington Heights Park District, No. 98 C 4786, 1999 WL 753930 (N.D. Ill. Sept. 15, 1999). All individual defendants, except for the Park District, were dismissed from the case. Id.
On November 1, 1999, the Park District filed a motion for summary judgment against Kelm on three remaining counts: Count I (Fourth Amendment Claim under 42 U.S.C. § 1983), Count V (Sex Discrimination Claim under Title VII), Count VI (Disability Discrimination Under the ADA). On February 29, 2000, this Court granted summary judgment in favor of the Park District on Count V and Count VI of the plaintiffs complaint. The Court found, however, that genuine issues of material fact existed with regard to the plaintiff's Fourth Amendment Claim. Consequently, this Court denied the Park District's motion for summary judgment in part and set a trial date for the resolution of issues pertaining to Count I of Kelm's Complaint.
In early March, 2000 the Park District requested a settlement demand from Kelm. Kelm submitted a written demand for $150,000 (including attorney's fees) to the Park District on March 15. 2000. The demand was itemized and included a demand for attorney's fees which Kelm had estimated at a total of $47,500 (the demand discounted the demand for attorney's fees to "$35,625 and counting") up until that date.
In response to Kelm's written settlement demand, attorney for the Park District, Matthew J. Egan ("Egan"), called the attorney for Kelm, Daniel P. Felix ("Felix") and stated that the Park District would offer Kelm $20,000 in the form of an Offer of Judgment. ("Offer of Judgment" or "Offer"). The Park District served Kelm with an Offer on March 21, 2000. The Park District's Offer of Judgment states in full:
Now comes the defendant, Arlington Heights Park District, a municipal corporation, by its attorneys, Pretzel Stouffer, Chartered, and pursuant to Federal Rule of Civil Procedure 68, hereby offers judgment to the plaintiff in the sum of Twenty Thousand and 0/100 Dollars ($20,000.00).
The Park District did not include a cover letter or any other document along with the Offer.
On March 27, 2000, Kelm filed his Acceptance of the Offer and simultaneously filed this motion to find plaintiff the prevailing party and award attorney's fees and costs. On May 1, 2000, the Park District filed their objections and response to the plaintiffs motion.
II. DISCUSSION
Plaintiff David Kelm brings this motion to be deemed a prevailing party and thereby recover attorney's fees and costs from the Park District. For the following reasons, the plaintiff's motion is granted.
A. Recovery of Attorneys Fees Under Rule 68
Rule 68 of the Federal Rules of Civil Procedure authorizes a defendant to make an offer of judgment "for the money . . . specified in the offer, with costs then accrued." If the plaintiff refuses the offer and goes on to win at trial but wins less than the amount of the offer, the plaintiff must pay the costs incurred by the defendant from the time of making the offer. If, as in this case, the plaintiff accepts the offer within ten days, judgment is entered for him.
The United States Supreme Court in Marek v. Chesnv, 473 U.S. 1 (1985) held that Rule 68 offers must include costs. The law is well settled that where costs are defined in the underlying statute to include attorney's fees, the court may award fees as part of the costs. Id. Kelm sought recovery for a violation of his Fourth Amendment right against unreasonable searches and seizures under Section 1983. Pursuant to 42 U.S.C. § 1988 ("Section 1988"), a prevailing party in a Section 1983 action may be awarded attorney's fees as a part of costs.
B. Ambiguity of the Defendant's Offer
If an offer made in the context of Rule 68 is silent as to costs, the court may award an additional amount to cover them.Webb v. James, 147 F.3d 617, 622 (7th Cir. 1998) (citing Marek, 473 U.S. at 9). Further, any ambiguities in a Rule 68 offer must be resolved against the defendant-offeror, not only because the defendant drafted the offer but because the plaintiff is being asked to give up his right to a trial. Id.; Nordby v. Anchor Hocking Packaging Co., 199 F.3d 390, 391; Gavoni v. Dobbs House. Inc., 164 F.3d 1071, 1076 (7th Cir. 1999).
The analysis in Webb is instrumental to the facts of this case. The defendant in Webb made an offer "of judgment in the above captioned matter in the amount of Fifty Thousand Dollars ($50,000)." Webb, 147 F.3d at 619. The Seventh Circuit found that such language "was unclear as to whether attorney's fees were included, since such fees are often sought as add-on to the judgment." Id. at 622. The Court stated that the onus is on the defendant to make clear whether the offer is inclusive of fees when the underlying statute provides fees for the prevailing party. Id.
The defendant Park District argues that the present case is distinguishable factually and legally from the circumstances inWebb. First, the defendant asserts that in Webb there was no clear record of communications between the parties concerning settlement, including the issues of costs and attorney's fees. Even in the instant case, however, there is no clear record of communications between Klem and the Park District that undisputably establishes that the Offer included costs and attorneys fees as requested in Klem's written demand. Second, the defendant states that in the present case there is no issue of Fed.R.Civ. 60(b)(1) ("Rule 60(b)(1)) relief before this Court as there was in Webb. The Rule 60(b)(1) issue in Webb did not in anyway interfere with the Seventh Circuit's analysis of ambiguous Offers of Judgment under Rule 68. Consequently, this Court finds the defendant's distinctions inaccurate as well as irrelevant.
The Park District relies on language from Trent v. Parkview Metals Products, 157 F.R.D. 45 (N.D.Ill. 1994), to provide support for its position that where an Offer is silent as to costs, a court must look to the "circumstances as a whole to determine whether the parties understood the Offer and Acceptance to encompass plaintiffs attorney's fee." Id. at 48. In that case, however, the Offer of Judgment provided that it included "costs accrued to date." Id. at 46. This is not true of the Offer of Judgment provided by the Park District. In addition, Trent was decided by a District Court prior to Circuit Court decisions that have since addressed the very same issue, Consequently, this Court sees no reason to rely on Treat over equally applicable and subsequent Seventh Circuit decisions.
The Park District's Offer reads in full:
Now comes the defendant, Arlington Heights Park District, a municipal corporation, by its attorneys, Pretzel Stouffer, Chartered, and pursuant to Federal Rule of Civil Procedure 68, hereby offers judgment to the plaintiff in the sum of Twenty Thousand and 0/100 Dollars ($20,000.00).
Similar to the defendant's offer in Webb, the Park District's Offer of Judgment is unclear about whether attorney's fees are included in the $20,000 Offer of Judgment or not. The fact that Kelm requested attorney's fees and costs in his written settlement demand does not excuse the Park District from its responsibility to "make clear whether the offer is inclusive of fees when the underlying statute provides fees for the prevailing party." Webb, 147 F.3d at 622. The Park District's Offer is silent as to fees and costs, and under these circumstances, the court may then award an additional amount to costs and attorney's fees as permitted by Section 1983 pursuant to Section 1988.
C. Prevailing Party Status
The Seventh Circuit has held in the civil rights context that when a lawsuit is settled pursuant to Rule 68, the mere fact that a plaintiff obtained some recovery does not automatically make him a "prevailing party because defendants often settle even meritless lawsuits." Fisher v Kelly, 105 F.3d 350, 352 (7th Cir. 1997). In Fisher, the Court explained that "[i]f a suit is settled, the question is complicated: the mere fact that the plaintiff obtained some recovery does not automatically make [him] a prevailing party because defendants often settle even meritless lawsuits." Id. The Seventh Circuit developed a two-pan test for determining prevailing party status when a case has settled: 1) whether the lawsuit was "causally linked to the relief obtained," and 2) whether the defendant acted gratuitously, that is, the lawsuit was "frivolous, unreasonable, or groundless." Fisher 105 F.3 at 353 (quoting Gekas v. Attorney Registration and Disciplinary Comm'n, 793 F.2d 846, 849-850 (7th Cir. 1986)).
This Court finds that Kelm satisfies both prongs of the two part test and is therefore a prevailing party for the purposes of Rule 68. As to the first prong, a "lawsuit is causally linked to the relief obtained if it played a provocative role in obtaining relief" Hooper v. Demco. Inc., 37 F.3d 287 (7th Cir. 1994) (internal citations omitted). In the instant case, the Park District only provided a settlement option to the plaintiff upon the realization that the plaintiffs Fourth Amendment claim would proceed to trial. Prior to this Court's ruling of the defendant's motion for summary judgment, the Park District had not indicated any willingness to settle Kelm's claim. In light of the close proximity of time between the when the parties knew that they would have to prepare for trial on the issues surrounding Kelm's Fourth Amendment claim and when the Park District requested a written settlement demand from Kelm. the surviving claim appears to have acted as a catalyst for the Offer of Judgment and thus satisfies the causal link requirement. See Hooper, 37 F.3d at 292 (internal citations omitted).
The second prong of the two part test requires that the suit must have prompted the defendant to act or cease its behavior based on the strength of its case, not "wholly gratuitously" or "because of the nuisance value" of the claim. Id. at 292, 293. The Park District contends that the number of claims and the number of defendants dismissed since the suit's inception demonstrate that the plaintiff's claim is frivolous. The Park District, however, fails to cite any authority in support of this argument. There is no penalty for bringing additional claims even if they are all rejected, as long as one claim succeeds. Place v. Abbot Labs, 94 C 5491, 2000 US Dist LEXIS 5477, at page 9 (March 17, 2000). The dismissal of other claims is only relevant when calculating how much time that party's attorneys may be assessed under Section 1988. Place v. Abbot Labs, 94 C 5491, 1999 US Dist LEXIS 13266, at page 4 (August 17, 1999). The Park District also argue's that Kelm's claim is frivolous because the allegations in his Complaint are not supported. In asserting such an argument, the defendant ignores the fact that this Court, after review, found enough support in the record to deny the Park District's motion for summary judgment. Since the plaintiff's claim is causally linked to the relief received and is not frivolous, Kelm is the prevailing party.
D. Technical or Dc Minimis Recovery
Even if a plaintiff is a prevailing party, a district court may deny attorney's fees — on the ground that no amount of fees would be reasonable — if the plaintiffs recovery is merely technical or de minimis. Farrar v. Hobby, 506 U.S. 103, 114-116 (1992); Fisher, 105 F.3d at 352; Johnson v. Lafayette Fire Fighters Ass'n, 51 F.3d 726, 731 (7th Cir. 1995). The Seventh Circuit has adopted a three-factor test to determine if relief is merely technical or de minimis: I) the difference between the judgment recovered the recovery sought; 2) the significance of the legal issue on which the plaintiff prevailed; and 3) the public purpose served by the litigation. Fisher 105 F.3d at 353.
According to the factors to be considered, the plaintiffs relief was neither technical nor de minimis. The defendant argues that since Kelm had initially sought approximately $56 million from the various defendants and received only $20,000, Kelm's relief comparatively is de minimis. The Park District, however, does not offer any authority to support its position that the Offer should be measured and compared to his last settlement demand of $150,00 (including attorney's fee). This Court can see no logical reason to measure the $20,000 Offer against the recovery Kelm initially sought when the claim included several defendants and numerous allegations. Under the law of the Seventh Circuit, a judgment for $20,000 dollars is certainly adequate for the purpose of recovering attorney's fees. See Cole v. Wodziak, 169 F.3d 486, 489 (7th Cir. 1999) (holding that in order to surpass the de minimis threshold a plaintiff should recover at least 10% of the demand).
Finally, the defendant contends that no public purpose was served by the litigation. This Court believes otherwise — an important public purpose is served by those actions that attempt to uphold the Bill of Rights and the Constitution.
111. CONCLUSION
For the foregoing reasons, the plaintiffs motion to find plaintiff the prevailing party and recover attorney's fees is GRANTED. The plaintiff has thirty (30) days to submit a petition for fees and costs pursuant to Local Rule 54.3.