Oral argument: Dec. 1, 2008
On Exception to the Fifth and Final Report of the Special Master: United States Supreme Court (April 10, 2008)
Original Jurisdiction, Special Master, Costs, Expert Witness Fees, Interstate River, Arkansas River Compact
Since 1902, Kansas and Colorado have been disputing the proper use of the Arkansas River. Each time a new issue arises, the Supreme Court, which has exclusive jurisdiction over this type of case, has called upon a Special Master to hear the arguments and make a determination. In the most recent case, Kansas claimed that Colorado violated the Arkansas River Compact by depleting the river of water that the Compact reserves for Kansas. Extensive expert witness testimony was required in the case, and ultimately the Special Master ruled in favor of Kansas. The Special Master also decided that, in accordance with 28 U.S.C. § 1821(b), expert witness fees would be limited to $40 per day. Kansas, having spent more than $9 million dollars on expert witnesses throughout the case, disagrees with this determination, arguing that 28 U.S.C. § 1821(b) does not apply to cases in which the Supreme Court has original jurisdiction. The Supreme Court will decide whether it is bound by 28 U.S.C. § 1821(b) when hearing a case under its original jurisdiction or whether, as argued by Kansas, the Court is free to make its own determination regarding fees.
The State of Kansas excepts to the ruling of the Special Master that, in the exercise of the Court’s original jurisdiction, the Court is bound by the Congressional limit on the federal district courts in awarding costs for expert witnesses.
When the Supreme Court hears a case under its exclusive, original jurisdiction, is it bound by rules set by Congress concerning the award of expert witness costs?
Because this case is between “two or more states,” this is one of the rare cases where the United States Supreme Court has original jurisdiction under Article III, Section 2 of the U.S. Constitution. U.S. Constitution, Art. III, Sec. 2. For over a hundred years, Kansas and Colorado have been disputing the proper use of the Arkansas River’s waters before the Supreme Court. Brief for Kansas at 1. In 1948, Kansas and Colorado entered into the Arkansas River Compact (“Compact”), which allows Colorado, which is upstream of Kansas, to use the waters from the Arkansas River, as long as it does not materially deplete usable water flows to Kansas. Id. at 3. Shortly thereafter, the development of new well technology resulted in numerous new irrigation wells being dug in Colorado along the Arkansas River. Id. at 4.
In 1985, Kansas filed suit in the Supreme Court, claiming that Colorado violated the Compact because the new wells in Colorado used too much of the Arkansas River’s water. Kansas v. Colorado, 514 U.S. 673, 679 (1995). The Supreme Court assigned a Special Master to look into the dispute and make recommendations to the Supreme Court on how to resolve it. See id. The Special Master agreed with Kansas and recommended the Supreme Court to find that Colorado had overused the river’s water from 1950 to 1994 and award damages to Kansas. Kansas v. Colorado, 543 U.S. 86, 90-91, 96-97 (2004). The Supreme Court accepted the Special Master’s recommendations and ordered Colorado to pay approximately $34.6 million in damages to Kansas, which Colorado did. Brief for Kansas at 5.
Unfortunately, disagreements over the water continued, necessitating the Special Master’s continued involvement, and both states ended up developing complicated computer models to help determine Colorado’s compliance with the Compact. Brief for Kansas at 6. Colorado abandoned its model in 1995, id., and agreed to rely on Kansas’s model, the Hydrologic-Institute Model (“H-I Model”). Kansas v. Colorado, 543 U.S. at 93, 99. The Supreme Court also accepted the use of the H-I Model for this purpose. Id. at 99. However, the H-I Model became the subject of much controversy, id., resulting in Kansas spending millions of dollars on expert investigation and analysis of the H-I Model. See Brief for Kansas at 7-8.
In 2004, the Supreme Court ordered the Special Master to continue reporting on the remaining disagreements between the states. See Kansas v. Colorado, 543 U.S. at 105-106. One of the Special Master’s final determinations was that Kansas should be awarded court costs, including expert witness fees, but determined those fees were limited by 28 U.S.C. § 1821(b) to a witness attendance fee of $40 per day. Brief for Kansas at 7. Kansas disagreed with the limitation, which would reduce its actual expert witness fees from approximately $9.2 million down to about $163,000, and proposed that Colorado should pay the full $9.2 million. Id. at 7-8. The Special Master encouraged the states to accept his legal determinations (including the limitation) and negotiate the costs themselves, promising them that either party could still take exception with his determinations of legal issues. Id. at 9. Kansas and Colorado complied with his request and negotiated the total expert witness costs, assuming the limitation did apply, to be about $200,000. Id. They further agreed that with the limited expert witness costs, the total court costs were approximately $1.1 million, which Colorado paid. Id.
In this case, Kansas is taking exception to the Special Master’s determination that § 1821(b) limits expert witness fees to a $40-per-day attendance fee, and is arguing that § 1821(b) does not bind the Supreme Court in original jurisdiction cases and that it should remand the case to the Special Master to calculate Kansas’s reasonable expert witness fees without the § 1821(b) limitation. Brief for Kansas at 38-39.
When exercising its original jurisdiction, is the Supreme Court bound by Congress’s regulations concerning awarding costs for expert witnesses? See Kansas v. Colorado, Docket No. 105, Original (U.S. 2007).
One practical concern Colorado raises is that if Congress cannot regulate the award of costs of expert witness in cases falling within the Supreme Court’s original jurisdiction, it would create a non-uniform set of rules in the federal court system. See Brief for Colorado at 18. In most cases where the Supreme Court has original jurisdiction, the lower federal courts also have concurrent jurisdiction. See id. at 18. Colorado argues that if Congress could not regulate the Supreme Court’s awards of costs in cases of its original jurisdiction, the Supreme Court could conceivably award substantially larger expert witness fees and costs to the prevailing party than the lower federal courts could. See id. at 18. In this case, the difference could be as much as nine million dollars. See Brief for Kansas at 7-8. Therefore, Colorado argues, this could create an incentive for plaintiffs to forum shop, and prefer the Supreme Court over the lower federal courts. See Brief for Colorado at 18.
Kansas argues that not having a uniform set of rules governing awards of expert witness costs for the federal courts and Supreme Court is not really a problem because it would affect only a handful of cases. See Brief for Kansas at 21. Kansas points out that cases in which the Supreme Court has original jurisdiction and no other courts share concurrent jurisdiction over the matter, are actually quite rare. See id. at 21. Article III, section 2 of the U.S. Constitution grants original jurisdiction to the Supreme Court over just a select few categories of cases. See LII Wex, Original Jurisdiction. Plus, the lower federal courts also have concurrent jurisdiction over cases in most of these categories. See 28 U.S.C. §1251, §1253, §1331, §1332.In fact, the Supreme Court has exclusive jurisdiction (where no other court has jurisdiction to hear the case) over only one category of cases—cases that involve disputes between states, as is the case here. See LII Wex, Original Jurisdiction.
Kansas also argues that interstate proceedings involving an interstate river are unique kinds of cases which call for simple fairness to dictate awards of expert witness costs. See Brief for Kansas at 36-37. Kansas contends that it is at a distinct disadvantage because it lies downstream of Colorado. See id. at 37. Kansas argues that Colorado controls the water because it is upstream, but it is Kansas, the downstream state, that must bear the expense and burden of proving that Colorado is misusing the water. See id. Furthermore, Kansas points out that Colorado relies on the H-I Model—the major source of the expert witness costs—as does the Supreme Court, and argues that fairness dictates that Colorado should share the costs of the expert witnesses. See id. at 37-38. Kansas sums up its argument by stating, “A downstream State, such as Kansas, should not be unfairly burdened by the formidable expert expenses necessary to protect its rights against an upstream State, provided that it ultimately prevails, as Kansas has in this case.” Id. at 37.
Colorado responds by arguing that Kansas unfairly misrepresents the impact of it being downstream of Colorado. See Brief for Colorado at 20. Colorado points out that the Arkansas River Compact was meant to benefit both states, not just Arkansas, because it is possible for Kansas’s pumping of the Arkansas River water to affect Colorado. See id. Plus, both states had developed their own complex computer models, but Colorado agreed to cooperate with Kansas and adopt the H-I Model in place of its own. See id. at 21. Therefore, Colorado argues, if Colorado has to pay for the expert witness fees resulting from this cooperation, it would discourage states from cooperating on technical matters in the future, and thus discourage resolving disputes through arbitration and instead encourage litigation. See id. at 21-22. Finally, Colorado argues that “even if Kansas as the complaining State had to shoulder the burden of developing the evidence to prove its claim, that is no different than the burden shouldered by other plaintiffs.” Id. at 21.
Congressional Intent and Statutory History
Kansas has taken exception to the Special Master’s finding that when awarding costs for expert witnesses, the Supreme Court is bound by the statutory limit set forth in 28 U.S.C. § 1821(b). The Special Master based his finding on Crawford Fitting Co. v. J.T. Gibbons, Inc. in which the Court ruled that federal courts are bound by statutory limitations unless there is additional legislation saying otherwise. See 1 Final Report, App. 95 (quoting Crawford Fitting Co. v. J.T. Gibbons, 482 U.S. 437, 439 (1987)).
Kansas agrees that 28 U.S.C. § 1821(b) was intended to limit federal courts’ discretion in awarding expert witness costs, but argues that to read the statute to include cases in which the Supreme Court has original jurisdiction would be contrary to Congressional intent. See Brief for Kansas at 14. Kansas bases this interpretation on its understanding of the history of the legislation. See id. at 10. 28 U.S.C. §§ 1821 and 1920 were derived from the 1853 Fee Act, which, according to Kansas, was intended by Congress only to apply to circuit and district courts, and not to cases where the Supreme Court had original jurisdiction. See id. at 14. As evidence of this, Kansas points to the fact that two years after that Act was created, the Supreme Court found that there was no legislation that regulated its original jurisdiction. See id. (quoting Florida v. Georgia, 17 How. (58 U.S.) 478, 491 (1854)). Since §§ 1821 and 1920 were created from the 1853 Fee Act, Kansas argues that they also must only apply to the lower federal courts. See id. Kansas additionally points to Texas v. New Mexico where the Supreme Court again affirmed that when exercising its original jurisdiction, it is not bound by statutory limits. See Brief for Kansas at 34 (quoting Texas v. New Mexico, 482 U.S. 124 (1987)).
Finally, Kansas stresses that Congress must not have intended for the limitation to apply to the Supreme Court because one of the primary aims of the statute was uniformity and the Supreme Court has no sister courts with which to be consistent. See Brief for Kansas at 20–21 (quoting Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 251–252 (1975)).
Colorado disagrees with Kansas and points out that Florida v. Georgia, the case that Kansas cited as support for its argument that the 1853 Fee Act did not apply to the Supreme Court, does explicitly address the point. See Brief for Colorado at 9–10. Colorado goes on to say that even if it had, §§ 1821 and 1920 were not brought over verbatim from the 1853 Fee Act and that Congress actually clarified its intent in those later statutes by adding a clause defining “court of the United States” to expressly include the Supreme Court. See id. at 11–12 (quoting Alyeska Pipeline, 421 U.S., at 255). According to Colorado, Kansas’ argument that Congress intended this limit to only apply to district and circuit courts is directly contrary to the clear language of the statutes. See id. at 10.Colorado further points out that any other rule would not make sense, because sometimes the Supreme Court has concurrent jurisdiction and Kansas’ interpretation would mean that certain cases brought before the same court would be subject to different rules for expert witness costs. See id. at 18.
Does § 1920 apply to the Supreme Court?
Kansas’ second argument is that the Special Master applied the wrong law and that the award of expert witness costs in cases where the Supreme Court has original jurisdiction should be governed by 28 U.S.C. § 1911. See Brief for Kansas at 26. According to Kansas, 28 U.S.C. § 1911 recognizes the Supreme Court’s inherent authority to fix fees and tax them against the litigants. See id. Kansas states that the existence of §1911 shows that Congress did not intend for §§ 1920 and 1821 to apply to the Supreme Court, and is further proof that Congress avoided any attempt to interfere with the Court’s discretion to award costs. See id. The Special Master disagreed, reading § 1911 narrowly as applying only to fees charged by the Supreme Court clerk and not authorizing the court to determine expert witness fees. See id. at 27–28 (quoting App. 2, at App. 12-13). Kansas says that this reading is incorrect and that “the fees of the clerk” was only one of the costs included in § 1911. See id. Expert witness fees are not explicitly authorized in the statute, according to Kansas, because the statute merely highlights the Supreme Court’s inherent authority to decide its own procedures (including those regarding witness fees) and not be limited by Congressional interference. See id. at 28.
In addition, Kansas emphasizes the absence of the word “justice” as indication that Congress did not intend for § 1920 to apply to the Supreme Court but only to judges and clerks of lower courts. See Brief for Kansas at 23–24. Kansas argues that though the statute says “court of the United States,” which 28 U.S.C. § 451 defines as including the Supreme Court, this is not enough to prove that the Supreme Court was meant to be included. See id. This is especially true, says Kansas, since § 451 also makes clear that the word “judge” does not include justices of the Supreme Court, and therefore supports Kansas’ argument for exclusion. See id. Kansas points out that in cases like this, ambiguities in the text of a statute are to be resolved by reference to the statute’s title, which here refers to the regulation of fees and costs of the “circuit and district courts of the United States” and says nothing about also extending to the Supreme Court. See id. at 21–22 (quoting Immigration & Naturalization Serv. v. Nat’l Ctr. for Immigrants' Rights, Inc., 502 U.S. 183, 189 (1991)).
Colorado agrees with the Special Master that § 1911 only refers to fees of the clerk and does not include expert witness fees. See Brief for Colorado at 15. According to Colorado, § 1911 is really more akin to §§ 1913 and 1914 which also address various fees of the court but are read in conjunction with §§ 1821 and 1920, not instead of them. See id. at 15–16. Further, Colorado and the Special Master argue that Kansas’ reading of the statute focuses solely on the use of the word “judge” and ignores the rest of the language which says “judge or clerk of any court of the United States” and then clearly defines “court of the United States” to include the Supreme Court. See Brief for Colorado at 5 (quoting 1 Final Report, App. 97). According to the Special Master, the use of “judge” must be read broadly to include justices or else § 1920 would apply to clerks of the Supreme Court and not its justices, which would create conflict. See id. at 13 (quoting 1 Final Report, App. 96). Also, contrary to Kansas’ argument that § 451 defines judge in a way that does not include justices, Colorado points out that § 451 really defines the term “judge of the United States” which is not the term used in § 1920. See id. Colorado implies that “judge,” when used by itself in the interest of brevity, is meant to include all levels of the federal courts, and should not be read to exclude the Supreme Court. See id. at 14. For example, the Special Master points out the Article III of the US Constitution uses “judge” to include both Supreme Court justices and lower court judges. See 1 Final Report, App. 96 (quoting Article III, Section 1, of the U.S. Constitution).
Does Congress have Final Authority over Supreme Court Proceedings?
Lastly, Kansas argues that even if Congress had intended the expert witness limitation to extend to the Supreme Court, it would not be valid because the Constitution does not give Congress the authority to regulate Supreme Court proceedings. See Brief for Kansas at 30. Specifically, Kansas states that Article III of the Constitution, while expressly giving Congress the authority to regulate the Court’s appellate jurisdiction, provides no similar grant of authority over its original jurisdiction nor does it provide any limitations on the Court. See id. at 32(quoting 22 James Wm. Moore, Moore's Federal Practice § 402.02 [b], at 402-24.3 (3d ed. 2007)). Kansas argues that this suggests that the Court itself has final authority in cases where it has original jurisdiction, and is not subject to Congressional limitations. See Brief for Kansas at 33.
Colorado disagrees, pointing out that the very cases Kansas relies on actually run contrary to its argument. For example, in Grayson v. Virginia, the court held that courts were “subject to the interposition, alteration, and control, of the Legislature,” and in Florida v. Georgia, the court said that the courts could decide on their mode of proceeding “in the absence of legislation by congress.” See Brief for Colorado at 17 (quoting Grayson v. Virginia, 3 Dall. (3 U.S.) 320 (1796); Florida v. Georgia, 58 U.S. 478 (1854)). According to Colorado, it seems clear that Congress does have the authority to impose a limit on expert witness fees. See id. at 18.
In Kansas v. Colorado, the Supreme Court will decide whether, in cases arising under its original jurisdiction, 28 U.S.C. § 1821(b) limits its authority to award expert witness costs. In addition to the language and legislative history of the statute, the Court will look to issues of uniformity, fairness and impact on future litigation, and may even need to examine Article III of the U.S. Constitution to determine who in fact has the final authority over Supreme Court proceedings. While this judgment will only affect the small percentage of cases which actually arise under the Supreme Court’s original jurisdiction, the impact on those cases could be quite substantial. The decision in this case alone will mean the difference of nearly $9 million.
Edited by: Joe Hashmall