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Key v. Chrysler Motors Corporation12/29/1998
nion except for affirmance of the district court's decision to reduce the cost award by 80%.
{23} Hard cases can make bad law. Chrysler's claim of $210,514.93 in expert witness fees is extraordinarily high. But our aversion to that claim should not lead us to overlook Key's failure to mount a proper challenge in district court.
{24} The district court found that the fee was reasonable. I have my doubts about that finding. Chrysler argued that it needed to make an all-out effort to defend its measures for evaluating franchises, because an adverse ruling would have ramifications throughout the country. I wonder, however, whether it is appropriate to burden Key with costs that cannot be justified by the potential liability in Key's case alone. Perhaps it was reasonable for Chrysler, given its interests nationwide, to spend what it did on an expert. Yet, requiring Key to pay all those costs may well be unreasonable, given the limited financial impact of a judgment in Key's case alone. That was not, however, an argument raised by Key in district court, and I agree with the majority opinion that we must defer to the district court's discretion in rejecting Key's district court challenges to the reasonableness of the fee.
{25} Where I part company with the majority is in their affirmance of the district court's reduction by 80% of the total cost award. The factual predicate for that reduction is Key's inability to pay the full award. To be sure, most litigants could not afford to pay $200,000 in costs. The problem here is that Key offered no evidence of his financial condition. The majority opinion refers to "somewhat ambiguous" evidence presented at the cost hearing that showed "Key's business value to be less than $200,000." But the $200,000 figure referred to an estimate of the value of the franchise that was the subject of this litigation-the franchise that Key had hoped to acquire but that Chrysler had denied him. There was no evidence of Key's personal wealth or the net worth of his corporation. Chrysler has not conceded the issue; rather it has contended on appeal that the record is "absolutely devoid of any evidence of the financial condition of Key which would otherwise demonstrate his ability or inability to pay Chrysler's costs in full."
{26} The failure of Key to establish his inability to pay the cost award is critical, because otherwise the disparity in wealth between Chrysler and him is immaterial. Disparity in wealth alone is insufficient to justify a reduction in the cost award. In , we wrote: "We agree that a party should not be denied an award of costs simply because it can `afford to swallow' the expense." The leading federal authorities state that disparity of wealth is not in itself a ground to deny or limit costs to the prevailing party. See ); ); 10 James Wm. Moore, Moore's Federal Practice, ยง 54-101 at 54-153 (3d ed. 1998). If we were to recognize a relative-wealth exception to the general rule that the prevailing party is entitled to recover its costs, the exception would consume the rule. For example, if an insurance company bore the expense for one side in the litigation, the insurance company would not be able to recover its costs. So often is one party much stronger financially than the other, that one would expect the relative-wealth exception to have been incorporated into the rules and statutes governing costs if their authors had intended courts to recognize the exception.
{27} Relative wealth of the parties is a proper consideration only if other compelling considerations are present, such as when the losing party is unable to pay costs. See . (If the prevailing party is as poor as the loser, why should the loser be relieved of
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