In SUMOTEXT CORP., v. ZOOVE, INC., ET AL., Case No. 16-cv-01370-BLF (N.D. Cal. San Jose Div., Aug. 23, 2021), before the Court was Defendant’s Motion for Review of the Clerk’s Taxation of E-Discovery Costs. Defendant argued that the Clerk improperly denied its request for $14,804.00 in electronic discovery costs.
On March 6, 2020, the jury rendered a verdict for Defendant and judgment was entered on the same date. Defendant filed a Bill of Costs on March 20, 2020. After a meet-and-confer between the parties, Defendant filed an Amended Bill of Costs on April 3, 2020 that requested costs in the total amount of $26,046.10. Defendant requested $11,102.10 in costs for deposition transcripts, $140.00 in costs for deposition exhibits, and $14,804.00 in costs for disclosure/formal discovery documents.
Defendant attached explanatory documents indicating that the $14,804.00 consisted of a portion of the monthly subscription fees paid by Defendant’s counsel to an electronic discovery vendor. Defendant’s counsel “allocate[d] the portion of the charges to the clients based on their usage of the [vendor’s] platform during the month.”
The Clerk allowed the bulk of the costs requested for deposition transcripts, denied the $140.00 requested for deposition exhibits, and denied the $14,804.00 requested for vendor fees. As to the vendor fees, the Clerk indicated that the “supporting documents [did] not itemize or support full amount claimed.”
“As a general rule, costs and fees should be awarded to the prevailing party.” In re Online DVD-Rental Antitrust Litig., 779 F.3d 914, 926 (9th Cir. 2015) (citing Fed. R. Civ. P. 54(d)(1)). “[A] district court’s discretion to award costs is limited to particular types of costs enumerated in 28 U.S.C. § 1920.” As relevant here, § 1920(4) provides that taxable costs include “[f]ees for exemplification and the costs of making copies of any materials where the copies are necessarily obtained for use in the case.” 28 U.S.C. § 1920(4).
Defendant asserted that the fees paid to the ESI vendor were taxable because the fees constituted electronic discovery costs that should properly be taxed pursuant to § 1920(4), which provides that a court may tax “[f]ees for exemplification and the costs of making copies of any materials where the copies are necessarily obtained for use in the case.” 28 U.S.C. § 1920(4). Defendant also relied on Civil Local Rule 54(d)(2), which interpreted § 1920(4) to mean that “[t]he cost of reproducing disclosure or formal discovery documents when used for any purpose in the case is allowable.” Civ. L.R. 54-3(d)(2).
In the Ninth Circuit, some electronic discovery may be taxable under § 1920(4). See In re Online DVD-Rental Antitrust Litig., 779 F.3d at 932. However, “fees are permitted only for the physical preparation and duplication of documents, not the intellectual effort involved in their production.”
Defendant submitted a declaration from it’s counsel. Defendant’s counsel stated that the $14,804.00 in fees to the vendor “were required to use the service so [he] could efficiently and completely produce electronic documents in response to discovery propounded by the other parties and comply with the E-Discovery order.”
However, the Court found that the table submitted as part of Defendant’s Amended Bill of Costs did not show what activities were performed on the vendor’s platform with respect to the case, nor provide the Court with enough specificity to conclude the $14,804.00 fees constituted taxable costs. Defendant’s chart “show[ed] sixteen different types of tasks that generally are associated with electronic discovery and indicating which of those tasks can be performed …. However, the chart does not show what tasks actually were performed on the  platform with respect to this case during any given month. Thus, it is impossible to determine which of each month’s fees constitute taxable costs, if any. Other courts have declined to tax costs in similar circumstances.” [Emphasis added].
Accordingly, the Court found that the Clerk properly disallowed the $14,804.00 in vendor fees.