I represented Warren Mauran for his age discrimination case against Walmart. A federal appeals court this week vacated an order requiring my client, a former Walmart worker who lost his age discrimination lawsuit against the corporation to pay a portion of Walmart’s costs.
U.S. District Judge R. Gary Klausner had ordered my client, who had sued Walmart for age discrimination after he was fired, to pay Walmart a total of $6,012.80 in costs.
A three-judge panel of the U.S. Court of Appeals for the Ninth Circuit based in San Francisco, CA, voided the charge in a split 2-to-1 decision. The majority ruled that the District Court Judge Honorable Klausner abused its discretion when it granted Walmart’s application for costs as the prevailing party in the case.
At the time of his termination, my client worked earning $11.50 an hour. The cost award represented almost 25 percent of my client’s annual income.
Awarding costs against losing plaintiffs in discrimination cases such as this is widely seen as a threat to the enforcement of U.S. civil rights laws, which require victims to act as their own “private attorneys general” and to file lawsuits against their employers. Victims of age discrimination would be loath to roll the dice in federal court or to take on a behemoth like Walmart, which earns 14.7 billion a year, if doing so risked financial ruin.
On behalf my client I argued to the District Court that under California law, a prevailing plaintiff should be awarded costs only if the plaintiff’s suit was “objectively without foundation.” Walmart successfully countered that the award of costs is a “procedural matter governed by federal law. Judge Klausner agreed with Walmart, ruling that he had discretion to award or not award costs to Walmart. In weighing the issue, Judge Klausner acknowledged “that an award of $6,012.80 in costs – which I argued is equal to nearly 25 percent of his annual income – seems like no small amount to Mauran.”
Judge Klausner also acknowledged that Mauran’s suit “presented close questions and that age discrimination is an important issue.” Although, Judge Klausner denied my motion to re-tax costs, he agreed that the 9th Circuit has recognized that an award of costs against a plaintiff could chill future civil rights litigation. After weighing all the pros and cons, Judge Klausner came down on the side of Walmart. He ordered my client to pay the costs, stating he was “not persuaded that an award of $6,012.80 would result in severe injustice or significant chill future civil rights litigation.”
I appealed the District Court’s rulings on granting Walmart’s motion for summary judgment and awarding costs against my client. Two members of the appeals court panel, Judges Kim McLane Wardlaw and Marsha Siegel Berzon, agreed with me that Judge Klausner “failed to appreciate the potential chilling effect on future civil rights actions or to consider whether severe injustice would result from an award of costs … The district court also abused its discretion by failing to consider the economic disparity between the parties.” The third judge on the panel, Bridget Shelton Bade, dissented, stating that my client should have to pay because he had not sufficiently “rebutted the presumption for awarding costs to the prevailing party”