Comprehensive Addiction Treatment Center, Inc. v. Les/ea, Court Awards Defendant $57,873.61 for E-Discovery Vendor Costs Incurred in Responding to ESI Discovery Requests
After prevailing on summary judgment, the Clerk of the Court awarded the Defendants $57,873.61 of taxable costs. The Plaintiffs filed a Motion seeking a review of the Clerk’s determination regarding the $55,649.98 of costs taxed for the Defendants’ vendor retained to retrieve process and produce ESI. The Plaintiffs argued that the services of a third party vendor to retrieve, restore and convert data, did not constitute “copying” under 28 U.S.C. § 1920(4).
In its analysis, the Court noted that under Rule 54, a prevailing party is presumptively entitled to recover all of its costs. The Court indicated that under 28 U.S.C. § 1920(4), the Court may award copy and exemplification fees for copies of any materials “necessarily” obtained for use in the case. The Court clarified that the “necessarily obtained standard” does not permit the recovery of costs that were incurred for the convenience of counsel or the court. The Court noted that once the costs are proven to be statutorily authorized, the unsuccessful party must prove that the costs were improper and cannot be recovered. The Court observed further that awarding costs incurred in responding to discovery requests to the prevailing is logical and noted that the risk of facing these costs encourages the parties “to make narrow, focused discovery requests, rather than going on broad, potentially expensive, fishing expeditions,” citing Crandall v. City & Cnty. of Denver, 594 F.Supp.2d 1245, 1256 (D.Colo.2009. The Court then cited cases which recognized that e-discovery related costs are recoverable under 28 U.S.C. § 1920(4).
The Defendants in this case hired a third-party vendor to retrieve and restore ESI requested by the Plaintiffs during discovery. The Defendants wrote to Plaintiffs’ counsel on three different occasions detailing the difficulties and complexities encountered in obtaining the ESI and the efforts of their vendor to retrieve and restore the ESI requested. The Court observed that the Plaintiffs were therefore well aware that the Defendants were using the services of an e-discovery vendor to obtain the ESI and were kept well informed with respect to the vendor’s efforts to obtain and restore the data requested. The Court noted that the Plaintiffs failed to make any effort to change the scope of their request or limit the costs of the discovery effort.
The Court held that the Defendants’ costs incurred in connection with ESI were expenses enumerated in 28 U.S.C. § 1920(4). The Court observed that the “ESI expenses were not merely for the convenience of the parties nor were they materials produced solely for discovery as Plaintiffs filed a new Complaint that included information gleaned from the ESI. Thus, the ESI expenses were reasonably necessary for use in the case.” The Court noted further that the Plaintiffs were “aware of the monumental effort to retrieve and convert the data into a retrievable format” in response to their discovery requests. The Court found that the “Plaintiffs own litigation choices and aggressive course of discovery necessarily resulted in ‘heightened’ defense costs.” The Court therefore denied the Plaintiffs’ Motion to Review Clerk’s Taxing of Costs and awarded Defendants $57,873.61 in costs.
Comprehensive Addiction Treatment Center, Inc. v. Leslea, No. 11-cv-03417-CMA-MJW, 2015 WL 638198 (D. Colo. Feb. 13, 2015)