ESI Costs Claimed Were Not Narrowly Targeted To Those Allowable Under 28 U.S.C. § 1920(4).
28 U.S.C. § 1920(4) allows district judges to tax certain enumerated litigation expenses as “costs,” including “the costs of making copies of any materials where the copies are necessarily obtained for use in the case.” (Keep in mind that federal parlance for taxing costs means they can be allowed against a non-prevailing party, whereas in state court it means that certain claimed costs are denied/diminished—“taxed” in state court parlance.) Under Rare Tires America, Inc. v. Hoosier Racing Tire Corp., 674 F.3d 158, 167 (3d Cir. 2012), the Third Circuit was concerned that certain electronic storage information (ESI) activities could not be considered “making copies,” construing it to more narrowly cover “the conversion of native files to Tagged Image File Format (TIFF)” and “scanning of documents to create digital duplicates.” However, Rare Tires determined that all other activities, such as searching, culling, imaging hard drives, and deduplication are not taxable. (Id. at 171 n.11.) [For California federal purposes, the Ninth Circuit has followed the narrow interpretation of “making copies” adopted in Rare Tires. See In re Online DVD-Rental Antitrust Litig., 779 F.3d 914, 925-926 (9th Cir. 2005), reviewed in our February 28, 2015 post.]
In Camesi v. University of Pittsburgh Medical Center, No. 15-1865 (3d Cir. Mar. 18, 2016) (not precedential), plaintiffs/putative class members filed a FLSA meal break class action against the University of Pittsburgh Medical and multiple related entities, where about 3,000 potential collective action members opted in. After conditional certification was granted, discovery kicked off, including contentious activity involving ESI. The district judge granted UPMC’s motion to decertify and denied Plaintiffs’ certification motion. UPMC filed a bill of costs, with the clerk taxing (allowing) costs in the amount of $310,000 for copying costs—the latter based on certain ESI activities in the case.
The Third Circuit reversed and remanded. It could not tell from the ESI forensic consultant declarations whether the ESI activities fell within recoverable Rare Tires’ “making copies” test—meaning that it was ambiguous as to whether only recoverable scanning and file format conversion was involved. Obviously, this counsels that prevailing parties need to provide specific forensic consultant declarations in order to justify recovery of “routine” costs in ESI contexts.
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