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64 Fair empl.prac.cas. (Bna) 627, 64 Empl. Prac. Dec. P 43,121 Phyllis J. Scheeler, Appellee/cross-Appellant v. Crane Company, a Foreign Corporation and Roy L. Still, Appellants/cross-Appellees
Citation: 21 F.3d 791Docket: 93-1740
Court: Court of Appeals for the Eighth Circuit; April 4, 1994; Federal Appellate Court
The case involves Phyllis Scheeler suing Crane Company and its plant manager, Roy L. Still, for sexual harassment under the Iowa Civil Rights Act, after the defendants removed the case to federal court based on diversity jurisdiction. Prior to trial, the defendants made a settlement offer of $15,000 under Rule 68 of the Federal Rules of Civil Procedure, which included all claims, costs, and attorney fees. The jury awarded Scheeler $12,500, plus interest and costs. She subsequently filed a motion to include reasonable attorney fees as taxable costs, which the trial judge granted. The defendants appealed this decision, arguing that attorney fees should not be considered as costs. The court affirmed the trial judge's ruling, referencing the Iowa Civil Rights Statute, Section 601A.15(8)(a)(8), which states that damages include reasonable attorney fees alongside actual damages and court costs. The court cited the Iowa Supreme Court's decision in Ayala v. Center Line, Inc., which classified attorney fees as court costs, and supported this with precedent from Maday v. Elview-Stewart Systems Co. The court noted that previous rulings established that attorney fees are to be determined by the trial court rather than a jury. Ultimately, the straightforward nature of the defendants' settlement offer, which explicitly covered attorney fees, reinforced the court's position that these fees were appropriately included in the judgment. The plaintiff incurred attorney fees of $3,500.00 prior to an offer of $15,000.00, which was less than her total potential recovery of $12,500.00 in damages plus attorney fees. Had she accepted the Rule 68 offer in February 1991, her total recovery would have been $15,000.00, but this amount would not have fully covered her attorney fees and costs. The judgment obtained after trial was more favorable than the original offer. It is deemed equitable to include attorney fees in the recovery, as this is necessary for a fair comparison with the original offer. The plaintiff is entitled to costs and attorney fees, as these are authorized under the Iowa Civil Rights Statute and cannot be altered by the Rule 68 offer. The case of Marek v. Chesny does not apply here, as the offer there included accrued costs and attorney fees, unlike the present case. The plaintiff cross-appealed a reduction of her claimed attorney fees from $40,445.01 to $27,500.00, but the court found no abuse of discretion, noting that the plaintiff's overall recovery was less favorable than what was sought. The court considered the plaintiff's unsuccessful claims for disability and emotional distress in determining the fee reduction. The district court's judgment is fully affirmed.