Taxable ESI Costs the Final Dispute in Procaps v. Patheon Litigation
The multi-million dollar antitrust case Procaps S.A. v. Patheon, Inc., Case No. 12-24356 (S.D. Florida, Feb. 2, 2016) has finally ended by entry of summary judgment in favor of Defendant after a protracted and litigious discovery period (read more about these disputes on our blog here, here and here). As the prevailing party, Defendant filed its bill of taxable costs pursuant to 28 U.S.C. 1920, accompanied by a memorandum of law and numerous exhibits. Plaintiff filed an opposition to the bill of costs, seeking to either stay the costs, reduce them, or strike them entirely.
Defendant included its electronic discovery costs as part of its taxable costs. During litigation, Plaintiff required Defendant to produce documents in TIFF format with metadata and in searchable form. Defendant, as a result, had to scan paper documents into electronic format and also had to extract electronic documents and metadata in native format and convert them to TIFF. Defendant argued that it incurred the eDiscovery costs not for its own convenience but in response to Plaintiff’s demands. Plaintiff argued that electronic copying charges were not taxable costs.
The court analyzed the recent U.S. Supreme Court case Taniguchi v. Kan Pacific Saipan, Ltd., 132 S.Ct. 1997 (2012), which involved costs for translating documents, and law in the 11th Circuit indicating a general approach of allowing only limited recovery of eDiscovery costs. The court found that costs for formatting, imaging, and extraction, and creating load files were recoverable under Section 1920, but not tasks like keyword searching or extracting text or OCR from native files. Accordingly, the court taxed the majority of ESI costs but reduced them in part to exclude non-taxable charges.