                     United States Court of Appeals
                         FOR THE EIGHTH CIRCUIT
                                 ___________

                                 No. 00-3414
                                 ___________

Sequa Corporation,                       *
                                         *
             Plaintiff-Appellant,        *
                                         * Appeal from the United States
      v.                                 * District Court for the
                                         * Eastern District of Missouri.
William E. Cooper; Cynthia Bitting;      *
Allied Industrial Group, Inc.; Sturm     *        [PUBLISHED]
Acquisitions, L.P.; Sturm Engineered     *
Products, Inc.,                          *
                                         *
             Defendants-Appellees.       *
                                    ___________

                           Submitted: April 9, 2001

                                Filed: April 16, 2001
                                 ___________

Before BOWMAN and FAGG, Circuit Judges, and CARMAN,1 Judge.
                           ___________

PER CURIAM.




      1
       The Honorable Gregory W. Carman, Chief Judge, United States Court of
International Trade, sitting by designation.
       Sequa Corporation was the plaintiff in an action in the District Court.2 After
discovery battles and other skirmishes, but before service of an answer or a motion for
summary judgment by the defendants, Sequa gave notice of dismissal without prejudice
pursuant to Rule 41(a)(1)(i) of the Federal Rules of Civil Procedure. Defendants filed
objections to the notice of dismissal, which were overruled by the District Court. The
court correctly noted that Sequa's Rule 41(a)(1)(i) dismissal of its action was as of right
and was effective without an order by the court. Defendants thereafter sought an award
of the costs expended by them in defending the action prior to its dismissal. The
District Court granted the request in the amount of $2,582.71 as set forth in defendants'
bill of costs. Sequa appeals from the order of the District Court denying Sequa's
motion for reconsideration.

        For reversal, Sequa argues that the District Court was without jurisdiction to take
any action once Sequa filed its Rule 41(a)(1)(i) notice of dismissal. Alternatively,
Sequa argues that the District Court erred in its finding that Sequa's voluntary dismissal
of its lawsuit rendered defendants prevailing parties for purposes of an award of costs
under Rule 54 (d)(1). We find that neither of these arguments provides a sound basis
for reversing the District Court.

       As to the jurisdictional argument, a voluntary dismissal without prejudice under
Rule 41(a)(1)(i) does not deprive a District Court of its authority to award costs. See
Cooter & Gell v. Hartmax Corp., 496 U.S. 384, 395 (1990) (recognizing that "federal
court[s] may consider collateral issues after an action is no longer pending," including
"motions for costs or attorney's fees"); cf. Kurkowski v. Volcker, 819 F.2d 201, 203
(8th Cir. 1987) (holding that a district court had jurisdiction to impose Rule 11
sanctions on plaintiffs after voluntary dismissal without prejudice under Rule 41(a)(2)).
We conclude that the rationale of Kurkowski is equally applicable here insofar as our


      2
        The Honorable E. Richard Webber, United States District Judge for the Eastern
District of Missouri.
                                            -2-
Court found the basis for the district court's jurisdiction in "its inherent authority over
the cases and parties before it." 819 F.2d at 203. We find unpersuasive the language
in Szabo Food Service, Inc. v. Canteen Corp., 823 F.2d 1073, 1076-77 (7th Cir. 1987),
cert. dismissed, 485 U.S. 901 (1988), that can be construed as denying jurisdiction to
award costs in cases like the present case. Finally, we are satisfied that in the
circumstances of this case the District Court's exercise of its authority to award costs
must be upheld. Though we disagree with the court's conclusion that Sequa's voluntary
dismissal of the action made defendants prevailing parties, we note that Rule 54(d)(1)
simply provides that ordinarily costs shall be allowed "as of course" to the prevailing
party "unless the court otherwise directs." We do not read Rule 54(d)(1) as impairing
the inherent authority of a trial court to award costs incurred in defending an action
prior to its voluntary dismissal by the plaintiff, even though a voluntary dismissal
without prejudice means that neither party can be said to have prevailed. See Cantrell
v. Int'l Bhd. of Elec. Workers, Local 2021, 69 F.3d 456, 458 (10th Cir. 1995) (en banc)
(holding that district courts have the discretion to award costs when a party dismisses
an action, with or without prejudice). Here, defendants incurred costs in defending the
action before Sequa took its voluntary dismissal. We are satisfied the district court did
not abuse its discretion in allowing defendants to recover their costs.

      The order of the District Court denying Sequa's motion for reconsideration is
affirmed.

      A true copy.

             Attest:

                 CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




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