Rule 68 Offers of Judgment - Attorneys Fees Included Under Title VII, And State Law As Well

After a suit was filed raising claims under Title VII and the NYC ordinance prohibiting discrimination, the defendant extended a Rule 68 offer of judgment for $15,000 "inclusive of all costs available under all local, state or federal statutes accrued to date." Plaintiff accepted and then his counsel immediately sought $35,000 plus in attorneys' fees. The district court found that under Title VII attorneys' fees are part of costs so that they were covered by the $15,000. However, the definition under the New York statute was different, so the court awarded $17,000 under that statute. Wrong said the appellate court. Wilson v. Nomura Securities International, Inc. (2nd Cir. 3/2/04) [pdf]. Since the work for all the claims was truly indivisble, it was not appropriate to award separate attorneys' fees since they were compensated for in the original offer. It was not all good news for defense counsel however, as the dissent was somewhat less than charitable:

[T]he Court deems the parties to have settled the Plaintiff's claim for attorney's fees under municipal law by agreeing to a payment "inclusive of costs." Because that ruling imports into the word "costs" a meaning that it does not have under applicable municipal law and unjustifiably rewards the Defendants for their counsel's inattention to careful drafting, I respectfully dissent.

Ouch!