eDiscovery Daily Blog

eDiscovery Case Law: Plaintiff Responsible for Taxation of eDiscovery Costs

Back in May, we discussed a case where the plaintiff, after losing its lawsuit, was responsible for repaying the defendant more than $367,000 in eDiscovery costs.  It appears that making plaintiffs responsible for eDiscovery costs when they lose is becoming a trend.

In re Aspartame Antitrust Litig., No. 2:06-CV-1732-LDD, (E.D. Pa. Oct. 5, 2011),a case with a “staggering” volume of discovery, successful defendants were awarded about $500,000 of their electronic discovery costs for a litigation database, imaging hard drives, keyword searches, de-duplication, and data extraction that allowed for cost-effective discovery. However, the court refused to award costs for defendants’ use of an eDiscovery program that provided visual clustering of documents and went beyond necessary keyword search and filtering functions.

Defendants in an artificial sweetener market allocation and price fixing class action obtained summary judgment against two representative plaintiffs that had not purchased the sweetener within the four-year statute of limitations. Defendants filed bills of costs, and the plaintiffs asked the court to deny or reduce those costs.

The court granted about $500,000 in disputed costs, most of which were incurred by defendants during electronic discovery. The volume of discovery was “staggering,” according to the court, and “in cases of this complexity, eDiscovery saves costs overall by allowing discovery to be conducted in an efficient and cost-effective manner.” Defendants’ use of third party vendors for keyword searches and culling of duplicates allowed one defendant to reduce over 366 gigabytes of potentially responsive data by 85%. The court stated:

“We therefore award costs for the creation of a litigation database, storage of data, imaging hard drives, keyword searches, de-duplication, data extraction and processing. Because a privilege screen is simply a keyword search for potentially privileged documents, we award that cost as well. In addition, we award costs associated with hosting data that accrued after defendants produced documents to plaintiffs because, as the plaintiffs themselves acknowledged earlier in the proceedings, discovery was ongoing in this case up until summary judgment was issued.”

The court also awarded costs for technical support and the creation of load files. However, it would “draw the line” at awarding costs for use of a “sophisticated eDiscovery program” that provided concept-based visual clustering of document collections. Such a service was “undoubtedly helpful,” but it was “squarely within the realm of costs that are not necessary for litigation but rather are acquired for the convenience of counsel.”

So, what do you think?  Should plaintiffs have to reimburse eDiscovery costs to defendants if they lose? Please share any comments you might have or if you’d like to know more about a particular topic.

Case Summary Source: Applied Discovery (free subscription required).  For eDiscovery news and best practices, check out the Applied Discovery Blog here.

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