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New Filing -- Novell's Opposition to SCO's Motion to Stay Taxation of Costs
Thursday, January 01 2009 @ 06:20 AM EST

One more new filing from Wednesday, this one from SCO v. Novell. Here's the docket entry:

12/31/2008 576 MEMORANDUM in Opposition re [575] MOTION to Stay Taxation of Costs filed by Defendant Novell, Inc.. (Attachments: # (1) Exhibit A, # (2) Exhibit B, # (3) Exhibit C, # (4) Exhibit D, # (5) Exhibit E, # (6) Exhibit F)(Sneddon, Heather)

- The Groklaw Team



**********************************************

MORRISON & FOERSTER LLP
Michael A. Jacobs, pro hac vice
David E. Melaugh, pro hac vice
[address]
[phone]
[fax]

ANDERSON & KARRENBERG
Thomas R. Karrenberg, #3726
Heather M. Sneddon, #9520
[address]
[phone]
[fax]

Attorneys for Defendant and Counterclaim-Plaintiff Novell, Inc.

IN THE UNITED STATES DISTRICT COURT
DISTRICT OF UTAH, CENTRAL DIVISION

THE SCO GROUP, INC., a Delaware corporation,
Plaintiff and Counterclaim-Defendant,

v.

NOVELL, INC., a Delaware corporation,
Defendant and Counterclaim-Plaintiff.
NOVELL'S OPPOSITION TO SCO'S
MOTION TO STAY TAXATION OF
COSTS


Case No. 2:04CV00139

Judge Dale A. Kimball

(1)

Federal Rule of Civil Procedure 54 entitles Novell to its costs. SCO moves to stay taxation of costs. The only reason SCO provides in favor of such a stay is the possibility that things will turn out differently for SCO on appeal. Several courts have held that the hope of an appellate victory is an insufficient reason to overcome the Rule 54 presumption in favor of a timely award of costs. This Court should, accordingly, deny SCO's motion.

In support of its motion to stay taxation, SCO cites only How v. City of Baxter Springs, Nos. 04-2256 & 04-2257 JWL, 2006 U.S. Dist. LEXIS 23951 (D. Kan. Apr. 26, 2006) (Ex. A hereto), in which the court, on an uncontested motion, stayed costs pending appeal. A subsequent case considering How concluded that How should be limited to unopposed stay requests. See Maytag Corp. v. Electrolux Home Prods., Inc., No. C 04-4067-MWB, 2006 U.S. Dist. LEXIS 89383 (N.D. Iowa Dec. 11, 2006) (Ex. B hereto). Examining the caselaw on staying costs, the Maytag court concluded that "the consensus seems to be that the court must have some valid reason for not awarding costs at the customary stage of the proceedings." Id. at *5; see also Fed. R. Civ. P. 54(d) (creating presumption in favor of costs award). In How, the "valid reason" was the consensus of the parties, a consensus not present here. In Maytag, the offered "valid reason" was the same as SCO offers — the possibility of reversal on appeal. Id. at *6. The Maytag court explicitly rejected such an argument:

The possibility that the underlying judgment might be reversed, with the result that the award of costs must also be reversed, is simply too speculative to outweigh the benefit of the trial court conducting a review of the bill of costs while the case is still fresh. The marginal difficulties of vacating an award of costs, upon which Maytag also relies, simply do not justify a stay based on the losing party's speculation that it might do better on appeal. Finally, the court notes that far more judicial resources have been expended to resolve the parties' dispute over whether or not to stay the taxation of costs than could possibly have been saved by delaying the taxation of costs to a later date, so that Maytag's judicial economy argument also is not persuasive. Therefore, the court will deny Maytag's motion to stay the taxation of costs.
Id. at *7-8 (internal citations omitted).

1 (2)

Here, there are at least three compelling reasons to deny this motion. First, as the Maytag court noted, it makes sense for this Court to review and determine costs while the facts of the case are fresh. Id. at *7; see also Le Moine v. Combined Commc'ns Corp., No. 95 C 5881, 1996 U.S. Dist. LEXIS 10838 (N.D. Ill. July 30, 1996) (Ex. C hereto) (expressing preference for review of costs while case fresh). Second, it avoids the possibility of piecemeal appeals, as "[w]ith prompt taxation, any appeal from the award of costs [can] feasibly be consolidated with the pending appeal on the merits, thereby enhancing judicial efficiency." Singleton v. Dep't of Corr. Educ., No. 1:03CV00004, 2003 U.S. Dist. LEXIS 17834, *4-5 (W.D. Vir. Oct. 3, 2003) (Ex. D hereto); see also Holley v. Giles County, No. 1:03-0071, 2005 U.S. Dist. LEXIS 44372, *6 (M.D. Tenn. Sept. 12, 2005) (Ex. E hereto) (same); Epcon Gas Sys. v. Bauer Compressors, Inc., No. 98-CV-75392, 2001 U.S. Dist. LEXIS 12665 (E.D. Mich. Mar. 26, 2001) (Ex. F hereto) (same). Third, establishing costs is the last step in determining how much SCO owes Novell, which will in turn allow Novell to amend its proof of claim before the Bankruptcy Court to set forth the precise and full amount of its claim. With the December 31, 2008, deadline for SCO to file its plan imminent and, presumably, confirmation proceedings to follow in short order, clarity as to the amount of Novell's claim will be important in the bankruptcy case, the more so because, if granted, Novell's costs will not be merely nominal.

DATED: December 31, 2008

ANDERSON & KARRENBERG

By: /s/ Heather M. Sneddon
Thomas R. Karrenberg
Heather M. Sneddon

- and -

MORRISON & FOERSTER LLP
Michael A. Jacobs, pro hac vice
David E. Melaugh, pro hac vice

Attorneys for Defendant and
Counterclaim-Plaintiff Novell, Inc.

2 (3)

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on this 31st day of December, 2008, I caused a true and correct copy of NOVELL'S OPPOSITION TO SCO'S MOTION TO STAY TAXATION OF COSTS to be served to the following:

Via CM/ECF:

Brent O. Hatch
Mark F. James
HATCH JAMES & DODGE, P.C.
[address]

Stuart H. Singer
William T. Dzurilla
Sashi Bach Boruchow
BOIES, SCHILLER & FLEXNER LLP
[address]

David Boies
Edward J. Normand
BOIES, SCHILLER & FLEXNER LLP
[address]

Devan V. Padmanabhan
John J. Brogan
DORSEY & WHITNEY, LLP
[address]

Via U.S. Mail, postage prepaid:

Stephen Neal Zack
BOIES, SCHILLER & FLEXNER LLP
[address]

/s/ Heather M. Sneddon

(4)


  


New Filing -- Novell's Opposition to SCO's Motion to Stay Taxation of Costs | 147 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections here
Authored by: jjon on Friday, January 02 2009 @ 06:05 AM EST
If any.

[ Reply to This | # ]

Off-topic threads
Authored by: jjon on Friday, January 02 2009 @ 06:06 AM EST
Talk about interesting things not related to the article

[ Reply to This | # ]

News Picks discussion
Authored by: jjon on Friday, January 02 2009 @ 06:10 AM EST
Discuss the News Picks here. Please change the title to identify which News
Pick you're discussing.

[ Reply to This | # ]

Trust vs. Debt?
Authored by: Anonymous on Friday, January 02 2009 @ 09:48 AM EST
As I understand it, the judgment amount to Novell should be held in constructive
trust, because it's not SCO's money.

How does the taxation of costs get recorded? Does this become part of the
trust? Is it "just another debt"? Is the taxation of litigation cost
somehow a more "senior" debt with priority since Novell was forced to
incur these costs to recover it's own misappropriated proerty?

Also, how close would $125k in legal expenses come to wiping out SCO's cash
reserve?

[ Reply to This | # ]

New Filing -- Novell's Opposition to SCO's Motion to Stay Taxation of Costs
Authored by: Anonymous on Friday, January 02 2009 @ 12:41 PM EST
Am I the only one with the perverse sense of humor, based on the shorthand way
of referring to cases by one name (ie. "How"), to want to want to see
a discussion sort of like...

Guy1: "How" says such and such.
Guy2: "How" isn't important because "What" supercedes it.
Guy1: I still think "How" is the way to go...
Guy3: Forget "How" and "What"... There is always
"Huh"
Guy1 and Guy2: Huh?

(OK, sorry. Running on 3 hours sleep in last 48. LOL)

Happy New Year everyone!

[ Reply to This | # ]

New Filing -- Novell's Opposition to SCO's Motion to Stay Taxation of Costs
Authored by: Anonymous on Friday, January 02 2009 @ 05:13 PM EST
Novell's dry wit appears again in their final sentence:
clarity ... will be important ... because, if granted, Novell's costs will not be merely nominal.
They will not be merely nominal. What a way to say it!

[ Reply to This | # ]

Who is "The Groklaw Team?"
Authored by: Anonymous on Saturday, January 03 2009 @ 01:21 AM EST
Who exactly is posting as the "Groklaw Team" now? Are you lawyers?
Paralegals? Mythical figures from the underworld?

[ Reply to This | # ]

What is "taxation of costs" ?
Authored by: Anonymous on Monday, January 05 2009 @ 12:48 PM EST
According to wikipedia,
Taxation of costs is a ministerial function performed by a court clerk upon the resolution of case. It involves entering the various costs and their amounts against the party (either the plaintiff or defendant) against whom those costs have been awarded by the court. .... Such costs can include items such as witness fees, mileage and subsistence, marshal's fees, attorney's and other docket fees, and a reporter's charge for transcript.

[ Reply to This | # ]

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