A bill of more than $360,000 that was to be recovered by defendants for electronic discovery costs has been slashed by more than 90 percent, as Judge Thomas Vanaskie of the 3rd U.S. Circuit Court of Appeals said for the three-judge panel that organizing electronic files cannot be considered part of the copying expense.
Since the volume of e-discovery has soared, courts have come down on both sides in awarding costs and the question of where the burden should fall has loomed large. Vanaskie issued an opinion March 16 that defines copies as only scanning and file-format conversion, awarding just $30,000 of the $365,000 that the U.S. District Court for the Western District of Pennsylvania had initially taxed in Race Tires America Inc. v. Hoosier Racing Tire Corp.
Before wading into the taxation issue, Vanaskie ascertained the intent of Section 1920, the modern version of the Fee Act of 1853, which governs discovery costs.
"The 1853 Act embodied the American 'depart[ure] from the English practice of attempting to provide the successful litigant with total reimbursement,'" Vanaskie said. "The 'American rule' against shifting the expense of litigation to the losing party is 'founded on the egalitarian concept of providing relatively easy access to the courts to all citizens and reducing the threat of liability for litigation expenses as an obstacle to the commencement of a lawsuit or the assertion of a defense that might have some merit.'
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Source: law.com
By: Saranac Hale Spencer
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