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Prevailing FLSA Defendant May Recover Costs From Unsuccessful Plaintiff

    Client Alerts
  • June 21, 2016

Last month’s CRST decision by the U.S. Supreme Court raised hopes for employers seeking to recover attorneys’ fees from the EEOC after prevailing in litigation against the agency. Last week, the Eighth Circuit Court of Appeals concluded that a defendant prevailing in a claim for overtime pay under the Fair Labor Standards Act may collect its court costs from the unsuccessful plaintiff.

In Lochridge v. Lindsay Mgmt. Co., Inc., the plaintiffs contended that they were misclassified as exempt from overtime requirements. A jury found for the employer, and the defendant sought reimbursement of $23,000 in court costs from the unsuccessful plaintiffs. The district court rejected this request, noting that the defendant had not claimed that the lawsuit was frivolous in nature.

The Eighth Circuit reversed this decision and remanded the matter to the district court. The court noted that the FLSA provides that prevailing plaintiffs recover attorneys’ fees and costs. However, the statute is silent with regard to employers’ ability to recover fees and costs if they win the claim. The Eighth Circuit concluded that the normal Rule 54(d) cost recovery provisions apply to FLSA lawsuits, and therefore, prevailing defendants can recover court costs.

Court costs usually pale in comparison to attorneys’ fees expended in defending overtime pay claims. Employers cannot recover attorneys’ fees under the FLSA absent strong evidence of a frivolous or baseless claim, or in the event of serious misconduct by the plaintiff. However, the prospect of recovery of costs allows defendants at least some measure of recovery when they demonstrate the legality of their pay practices.