An Examination of Decryption and Load Files: Taxable as Costs in Federal Court?
Our blog has been reviewing the case of CBT Flint Partnership, LLC v. Return Path, Inc. and Cisco Ironport Systems, LLC, No. 2013-1036 (Fed.Ct. December 13, 2013), where the court divided common electronic discovery costs into three stages to examine what fell under the scope of § 1920(4) for taxation of the costs of making copies. The court singled out a few issues that warranted special attention: decryption of documents and load files.
What is decryption of documents, and when and why might it be necessary? The court noted that if a document or data is stored in an encrypted form, decryption may be necessary to make a final production copy viewable to the requesting party. However, even if the decryption is necessary, the court held it was not a recoverable cost under § 1920(4). The reasoning for this is that encryption is typically done for the benefit of the holder of information, such as for safekeeping and storage. Restoring the data to a usable form is precedent to “making copies” and therefore, not recoverable.
However, the court does hold that the creation of “load files” may be recoverable to the extent that the files contain information requested in discovery. So what is a load file? The court cited the Sedona Conference and to paraphrase, a load file is a set of documents or data that indicates which pages or files belong together. Load files often contain metadata and coded data, if and when necessary. The Sedona Conference compared load files to blue slip sheets, used to organize paper document productions. The court opined that in general, load file costs are recoverable. However, if the load files include metadata or extracted text, whether such expenses are recoverable will turn on whether the information was required for the production.
Finally, the court noted that this opinion merely constitutes the “default rules,” and that parties can agree otherwise prior to productions being tendered.