eDiscovery Daily Blog

eDiscovery Case Law: Tennessee Court Orders Split eDiscovery Costs, Plaintiff Bond for Additional Discovery


In considering the allocation of costs in this contentious business dispute, Tennessee Magistrate Judge Joe B. Brown (not to be confused with TV’s Judge Joe Brown) ordered the parties to split the expenses related to material they had not already produced in Lubber Inc. v. Optari, LLC, No. 3:11-0042, (M.D. Tenn. Mar. 15, 2012).

The defendants asked the court to enter a protective order that did not require them to search for electronically stored information (ESI) outside the set period of October 4, 2010 through February 8, 2011; in the alternative, they asked the court to require the plaintiff to pay for the costs of the discovery. The defendants complained that the costs of the additional searches the plaintiff requested might “run at least $10,000 and produce gigabytes of ESI material.”

Judge Brown observed that Federal Rule of Civil Procedure 26(b)(2)(C)(iii) allows for “a great deal of latitude in controlling discovery.” He also noted that the general rule of discovery is that the producing party bears the costs of discovery. Even so, Judge Brown continued by offering the following commentary on discovery costs:

“One of the concerns of discovery is the allocation of costs. In general, costs are borne by the producing party. While this works in the vast majority of cases, the requesting parties have little incentive not to ask for everything possible. This leads to interrogatories and requests for production that are expressed in the broadest possible terms.

It is the Magistrate Judge’s experience and the view of a number of economists who have studied this issue that where the requesting party bears a part of the cost of producing what they request, the amount of material requested drops significantly. When a party has to contemplate whether the last possible bit of information will cost them more than it is worth, they quit asking for items of marginal relevance. As long as requesting the last bit of information costs them nothing they have little, if any, incentive not to request it. Even if they choose never to look at it, they have put the opposing party to the cost of production. In some cases discovery becomes a tool with which to bludgeon the other side into submission. The Magistrate Judge believes that both sides are doing that in this case.”

Judge Brown denied the defendants’ motion and required each party to bear one-half of the costs of producing materials going forward.

So, what do you think?  Was the ruling to share discovery costs and the bond for compelling discovery appropriate?  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).

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