Cost-shifting in federal E-Discovery cases after a party prevails has hit a significant road-bump in the federal courts under the Fourth and Third Circuits Court of Appeals. Both appellate courts have now held that the costs available under 28 U.S.C. sec. 1920(4) are limited to the actual costs of making copies of records — not all the activity leading up to the copy. In The County Vintner of North Carolina, LLC v. E. & J. Gallo Winery, Inc. recently issued from the Fourth Circuit Court of Appeal, items such as “flattening”, “index”, “extracting”, “searching”, “managing” etc. was not permitted to be recovered from the losing party. The only amounts allowed were for the actual coping of documents into either .pdf or .tif formats and the costs of the CDs to which the copies were burned. See http://www.ca4.uscourts.gov/Opinions/Published/122074.P.pdf
Some courts in other jurisdictions are taking a more liberal interpretation and it shouldn’t stop prevailing parties from asking the courts to award those costs — just don’t be surprised if your $100,000 request for E-discovery gets reduced to $200 or essentially the cost of the office supplies used.
