Syllabus. FARMER v. ARABIAN AMERICAN OIL CO. CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT. No. 32. Argued November 9-10, 1964.- A doctor formerly employed by an oil company to work in Saudi Arabia sued for breach of his employment contract. The jury failed to agree and the District Judge granted the company's motion for a directed verdict. Costs of more than $6,600 were taxed against the doctor, including transportation expenses of witnesses from Arabia and daily transcripts requested by company counsel. The Court of Appeals reversed, on the ground that a verdict should not have been directed, and remanded for a new trial. On remand the case was dismissed because of the doctor's inability to post a $6,000 bond as security for costs. The Court of Appeals again reversed, and indicated that the costs already taxed were exorbitant. At a second trial the jury found for the company. The clerk taxed costs at almost $12,000 for the two trials, which the second District Judge reduced by over 90%, eliminating the expenses of the overseas witnesses and the cost of the daily transcripts. The Court of Appeals upheld the costs for the second trial, but reversed as to costs for the first trial, although reducing the amount, holding that the second judge failed to give proper deference to the first judge's taxation of costs. Held: 1. The 100-mile subpoena provision in Rule 45 (e) of the Federal Rules of Civil Procedure does not completely bar a district court from taxing as costs expenses of transporting witnesses more than 100 miles, for Rule 54 (d) does leave the district court discretion to tax such expenses. Pp. 231-232. 2. It was not error for the District Judge at the end of the second trial when judgment was finally entered to determine costs for both trials, the first judgment and taxation of costs having been upset by the reversal of the trial judgment. Pp. 232-233. 3. The District Judge's discretion was appropriately exercised in his taxation of costs for both trials. Pp. 233–236. 324 F.2d 359, reversed. *Together with No. 33, Arabian American Oil Co. v. Farmer, also on certiorari to the same court. Opinion of the Court. 379 U.S. Kalman I. Nulman argued the cause for petitioner in No. 32 and respondent in No. 33. With him on the briefs was William V. Homans. Chester Bordeau argued the cause for respondent in No. 32 and petitioner in No. 33. With him on the briefs were Lowell Wadmond, William L. Owen and Thomas F. Barry. MR. JUSTICE BLACK delivered the opinion of the Court. The questions presented in this case relate to the power and discretion of a United States district court to tax as costs against the loser in a civil lawsuit expenses incurred by the winner in carrying on the litigation. Howard Farmer, a physician from Texas specializing in ophthalmology, started this litigation against the Arabian American Oil Company in a New York state court, claiming $4,000 damages for breach of an employment contract. The complaint alleged that in April 1955 the company entered into an agreement to employ Farmer as an ophthalmologist in Saudi Arabia at an annual salary of $16,000 plus a $4,000 living allowance per year, so long as the company continued its oil-well operations there, and that although he began work and properly performed his duties, the company wrongfully discharged him in March 1956. On the company's motion the case was removed to federal court because of diversity. The company admitted that it had employed Farmer but defended on the grounds that the discharge was not wrongful both because he had been employed at will rather than for a definite term, and because he had been discharged for good cause. At the trial Farmer attempted to show that the company discharged him because he had 1 By two successive amendments made several years later, the complaint was amended to claim, first, $59,683, and finally, $160,000. 227 Opinion of the Court. found that a number of Americans employed by the company in Arabia had contracted trachoma, a much dreaded tropical eye disease which may lead to blindness, and that although urged by the company's medical staff to falsify or suppress his findings, he had refused to do so. The company's evidence tended to disprove this charge and to show that Farmer had been discharged because he had operated on a young Arabian boy's eye, without first having received and examined a urinalysis and blood test report. This the company alleged to be in violation of a written company rule and standard surgical practice. Such tests had in fact been completed before Dr. Farmer performed the operation, but whether he had known of the tests or their results, and whether there actually had been a company rule requiring that he have the test results were in sharp dispute. The company, in order to refute Farmer's charge, brought three witnesses from Saudi Arabia to New York to testify in support of its version of the dispute. The jury failed to agree, after which District Judge Palmieri granted the company's motion for a directed verdict, 176 F. Supp. 45, and approved the clerk's taxation of costs against Farmer in the amount of $6,601.08, which included among other things transportation expenses for the witnesses from Arabia and costs of daily stenographic transcripts of the trial record furnished to the company's lawyers at their request. Holding that a verdict should not have been directed, the Court of Appeals reversed and remanded the case for a new trial, thereby upsetting the judgment and the taxation of costs. 277 F. 2d 46. On remand to the District Court the company obtained an order directing Farmer to put up security for costs in the sum of $6,000. Because Farmer was unable to post so large a bond, Judge MacMahon dismissed the case. The Court of Appeals reversed in an opinion that strongly Opinion of the Court. 379 U.S. Kalman I. Nulman argued the cause for petitioner in No. 32 and respondent in No. 33. was William V. Homans. With him on the briefs cause for respondent in With him on the briefs Chester Bordeau argued the No. 32 and petitioner in No. 33. were Lowell Wadmond, William L. Owen and Thomas F. Barry. MR. JUSTICE BLACK delivered the opinion of the Court. The questions presented in this case relate to the power and discretion of a United States district court to tax as costs against the loser in a civil lawsuit expenses incurred by the winner in carrying on the litigation. Howard Farmer, a physician from Texas specializing in ophthalmology, started this litigation against the Arabian American Oil Company in a New York state court, claiming $4,000 damages for breach of an employment contract. The complaint alleged that in April 1955 the company entered into an agreement to employ Farmer as an ophthalmologist in Saudi Arabia at an annual salary of $16,000 plus a $4,000 living allowance per year, so long as the company continued its oil-well operations there, and that although he began work and properly performed his duties, the company wrongfully discharged him in March 1956. On the company's motion the case was removed to federal court because of diversity. The company admitted that it had employed Farmer but defended on the grounds that the discharge was not wrongful both because he had been employed at will rather than for a definite term, and because he had been discharged for good cause. At the trial Farmer attempted to show that the company discharged him because he had 1 By two successive amendments made several years later, the complaint was amended to claim, first, $59,683, and finally, $160,000. 227 Opinion of the Court. found that a number of Americans employed by the company in Arabia had contracted trachoma, a much dreaded tropical eye disease which may lead to blindness, and that although urged by the company's medical staff to falsify or suppress his findings, he had refused to do so. The company's evidence tended to disprove this charge and to show that Farmer had been discharged because he had operated on a young Arabian boy's eye, without first having received and examined a urinalysis and blood test report. This the company alleged to be in violation of a written company rule and standard surgical practice. Such tests had in fact been completed before Dr. Farmer performed the operation, but whether he had known of the tests or their results, and whether there actually had been a company rule requiring that he have the test results were in sharp dispute. The company, in order to refute Farmer's charge, brought three witnesses from Saudi Arabia to New York to testify in support of its version of the dispute. The jury failed to agree, after which District Judge Palmieri granted the company's motion for a directed verdict, 176 F. Supp. 45, and approved the clerk's taxation of costs against Farmer in the amount of $6,601.08, which included among other things transportation expenses for the witnesses from Arabia and costs of daily stenographic transcripts of the trial record furnished to the company's lawyers at their request. Holding that a verdict should not have been directed, the Court of Appeals reversed and remanded the case for a new trial, thereby upsetting the judgment and the taxation of costs. 277 F. 2d 46. On remand to the District Court the company obtained an order directing Farmer to put up security for costs in the sum of $6,000. Because Farmer was unable to post so large a bond, Judge MacMahon dismissed the case. The Court of Appeals reversed in an opinion that strongly |