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Northern District of California Taxes E-Discovery Costs

Posted on September 23rd, 2015

In U.S. Ethernet Innovations, LLC v. Acer Inc., et. al., Case No. 10-03724 (N.D. Cal., Sept. 4, 2015), a patent infringement case, the Northern District of California ordered Plaintiff to pay the prevailing party’s costs pursuant to Fed. R. Civ. P. 54(d). The clerk of the court taxed these costs pursuant to 28 U.S.C. § 1920(4), including costs to certain defendants for electronic discovery.  Plaintiff objected to the taxation of costs.

28 U.S.C. § 1920(4) permits the taxation of costs for the “exemplification and the costs of making copies,” which many courts have interpreted to include certain costs related to the processing and collection of ESI. The court here considered to what extent it could conclude that the costs the prevailing parties incurred in collecting and producing electronic discovery amounted to “exemplification and the costs of making copies.”

The court (who had decided two previous cases with a similar issue) denied Plaintiff’s objection and determined that it would tax certain costs, and leave others as non-taxable (including any costs incurred solely for the convenience of counsel). The court held that it would tax all the prevailing party’s costs incurred for scanning, converting files, Bates numbering, preparing media such as CD-ROMs, and basic organization of electronic documents, but that it would not tax costs related to data processing, collection, and review.

The decision underscores the importance of accurate record keeping for purposes of seeking costs at the conclusion of a litigation, especially with respect to ESI-related costs, which can at times be the most costly in a case.

ILS – Plaintiff Electronic Discovery Experts

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