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Marek v. Chesney

Supreme Court of the United States · 1985 · Civil Procedure

Civil ProcedureRule 68CostsAttorney's FeesSection 1988Rule 68offer of judgmentcost shifting

Facts

Petitioners made a timely pretrial settlement offer of $100,000 under Rule 68. Respondent rejected the offer and later obtained a judgment of $60,000 in a § 1983 action, while also claiming $32,000 in preoffer costs and $139,692.47 in postoffer costs. The dispute centered on whether the offer was valid even though it did not separately itemize damages and costs, and whether Rule 68's reference to 'costs' included attorney's fees awardable under § 1988.

Issue

Whether petitioners' lump-sum settlement offer was a valid offer under Rule 68, and whether the term 'costs' in Rule 68 includes attorney's fees awardable under 42 U.S.C. § 1988. Also, whether respondent could recover postoffer attorney's fees after obtaining a judgment less favorable than the offer.

Rule

A Rule 68 offer is valid so long as it allows judgment to be taken against the defendant for the substantive relief and accrued costs; the offer need not separately itemize damages and costs. For purposes of Rule 68, 'costs' means all costs properly awardable under the relevant substantive statute or other authority, and where the underlying statute defines attorney's fees as part of costs, those fees are included within Rule 68 costs absent a contrary congressional expression.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In a federal civil-rights suit in Cleveland, Dana Ortiz sues Officer Neal Pruitt under 42 U.S.C. § 1983. Before trial, Pruitt serves a timely Rule 68 offer stating: "Defendant offers to allow judgment to be taken against him for $80,000," and says nothing else about costs; Ortiz rejects it and later wins $72,000.

Was the Rule 68 offer invalid because it failed to separately state the amount for damages and the amount for accrued costs?

Explanation. The majority held that Rule 68 does not require itemization of damages and costs. The critical question is whether the offer allows judgment against the defendant for the substantive relief and accrued costs. If the offer is silent about costs, the court includes an additional amount for accrued costs upon acceptance, so the offer remains valid unless it explicitly or implicitly excludes costs.