SCOTUS Opinion: District Courts Have No Discretion To Reduce Appellate Costs

Federal Rule of Appellate Procedure 39 allows the taxation of certain appellate “costs” to the prevailing party, including “premiums paid for a bond or other security to preserve rights pending appeal.” In City of San Antonio v., L.P., San Antonio obtained a judgment in the district court of roughly $55 million after a jury trial. opted to appeal and stay the judgment until the appeal was over by providing a supersedeas bond which ultimately wound up totaling $84 million to cover future interest and taxes while the appeal proceeded. won that appeal, including final judgment in its favor, and was awarded costs. then asked the district court to award it the bond premiums it had paid, totaling over $2.3 million. San Antonio balked, but the district court held it had no discretion under Fed. App. R. 39 to not award the premiums, and the Fifth Circuit affirmed.

The Court, in a unanimous decision by Justice Alito, affirmed, holding that the Rule places all the discretion over the award of costs in the appellate court’s hands. That the costs were “taxable in the district court” did not vest the district court with discretion to take a second look at the equities. The decision further allowed the appellate courts to allow the district courts to adjudicate factual disputes over costs.

A link to the opinion is here: