Electronic discovery is changing the entire landscape of how evidence is collected, organized, culled and searched in twenty-first century civil litigation. When cutting-edge eDiscovery software moves forward this fast, sometimes technology leaves our legislative statutes in the dust. A example of this may be the federal taxation-of-costs statute found in 28 U.S.C. §1920(4), where a losing party is on the hook to pay the prevailing party’s costs for “fees for exemplification and the costs of making copies of any materials where copies are necessarily obtained for use in the case.”
The parties in this case are two wineries – Country Vintner sued Gallo for alleged violations of North Carolina’s Unfair and Deceptive Practices Act in Country Vintner v. Gallo, No. 12-2074 (4th Cir. 2013). After responding to plaintiff ESI requests, Gallo prevailed on a Motion for Summary Judgment. It then sought taxation of costs to recoup $111,047.75 for the defense production. Country Vintner objected, and the district court concluded that Gallo was only entitled to $218.59. Gallo appealed, and the Fourth Circuit then faced what the blogosphere has now deemed the “making copies” case (a joke we made almost year ago!)
Following the Third Circuit’s logic in Race Car Tires Am. Inc. v. Hoosier Racing Tire Corp., 674 F.3d 158 (3rd Cir. 2012), the Fourth Circuit noted the term “making copies” is not defined by the statute. Therefore, they applied the “ordinary meaning” of the phrase and declined to tax the ESI costs to the losing party. The Fourth Circuit affirmed the district court’s order of taxable costs for only conversion of native files to TIFF and PDF and the costs of transferring the files to CDs.