Comprehensive Addiction Treatment Services, Inc. et al v. Leslea et al

Filing 69

ORDER denying 66 Motion for Review. Defendants are awarded $57,873.61 in costs. By Judge Christine M. Arguello on 02/13/2015. (athom, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Christine M. Arguello
Civil Action No. 11-cv-03417-CMA-MJW
COMPREHENSIVE ADDICTION TREATMENT CENTER, INC.,
a Colorado corporation, and
PAMELA MANUELE,
Plaintiffs,
v.
DARIA LESLEA, Individually and in her official capacity as Controlled Substance
Administrator, Division of Behavioral Health, f/k/a Alcohol and Drug Abuse Division,
Colorado Department of Human Services,
JANET WOOD, Individually and in her official capacity as Director,
Division of Behavioral Health f/k/a Alcohol and Drug Abuse Division,
Colorado Department of Human Services,
MARY McCANN, Individually and in her official capacity as Clinical Director,
Division of Behavioral Health f/k/a Alcohol and Drug Abuse Division,
Colorado Department of Human Services,
KAREN BEYE, Individually and in her official capacity as Executive Director,
Colorado Department of Human Services,
JOSCELYN GAY, Individually and in her official capacity as Deputy Executive
Director, Office of Behavioral Health, Colorado Department of Human Services,
KAREN MOONEY, Individually and in her official capacity as Treatment Field
Manager, Division of Behavioral Health f/k/a Alcohol and Drug Abuse Division,
Colorado Department of Human Services, and
THE COLORADO DEPARTMENT OF HUMAN SERVICES, DEPARTMENT OF
BEHAVIORAL HEALTH,
Defendants.
ORDER DENYING PLAINTIFFS’ MOTION TO REVIEW
This matter is before the Court on “Plaintiffs’ Motion to Review Clerk’s Taxing of
Costs Under F.R.C.P. 54(D)(1).” (Doc. # 66.) Because Defendants’ costs related to the
electronically stored information (“ESI”) are expenses enumerated in 28 U.S.C.

§ 1920(4), and Plaintiffs were aware that Defendants would have to retain an outside
consultant to retrieve and convert the ESI into a retrievable format, Plaintiffs’ Motion is
denied.
I.

BACKGROUND

On January 31, 2013, this Court granted Defendants’ Motion to Dismiss on
qualified immunity and for lack of subject matter jurisdiction pursuant to Fed.R.Civ.P.
12(B)(1) and 12(B)(6). (Doc. # 41.) After prevailing on summary judgment, Defendants
filed a Proposed Bill of Costs seeking costs totaling $58,037.01. (Doc. # 43.) At a
telephonic hearing, the Clerk of the Court awarded $57,873.61 of taxable costs. (Doc.
# 63.) On March 5, 2014, Plaintiffs filed the instant Motion seeking a review of the
Clerk’s determination concerning the costs taxed amount of $55,649.98, which accounts
for Defendants contracting with a private consulting company, Cyopsis, to retrieve and
convert ESI into a retrievable format to produce information requested by Plaintiffs.
(Doc. # 66.) Defendants filed a Response on March 31, 2014 (Doc. # 67), to which
Plaintiffs Replied on April 14, 2014 (Doc. # 68).
II.

ANALYSIS

Plaintiffs contend that the Court should reduce the taxing of costs entered by the
District Court Clerk from $57,873.61 to $2,387.03 because Defendants’ Bill of Costs
include the services of a third party vendor, Cyopsis, in retrieving, restoring and
converting data, which does not constitute “copying” under 28 U.S.C. § 1920(4).
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Defendants disagree, arguing that “[p]roduction costs in collecting, scanning, reviewing,
and preparing documents are necessary expenditures that are made for the purpose of
advancing the discovery phase of the case and as such, are taxable.”
Federal Rule of Civil Procedure 54 provides that “[u]nless a federal statute, these
rules, or a court order provides otherwise, costs—other than attorney’s fees—should be
allowed to the prevailing party.” Fed.R.Civ.P. 54(d)(1). Under Rule 54, a prevailing
party is presumptively entitled to recover all of its costs. See Cantrell v. Int’l Bhd. of
Elec. Workers, AFL–CIO, Local 2021, 69 F.3d 456, 457 (10th Cir. 1995). However, not
every expense is a permissible “cost.” Only the expenses enumerated in 28 U.S.C.
§ 1920 or other statutory authority may be taxed as “costs” under Rule 54(d). Crawford
Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 441–42 (1987); Sorbo v. United Parcel
Serv., 432 F.3d 1169, 1179 (10th Cir. 2005). Pursuant to 28 U.S.C. § 1920(4), the
Court may award copy and exemplification fees for copies of any materials necessarily
obtained for use in the case. “The ‘necessarily obtained for use in the case’ standard
does not allow a prevailing party to recover costs for materials that merely ‘added to the
convenience of counsel’ or the district court.” In re Williams Sec. Litig—WCG Subclass,
558 F.3d 1144, 1147–48 (10th Cir. 2009) (citation omitted). “To be recoverable, a
prevailing party’s transcription and copy costs must be reasonably necessary to the
litigation of the case.” Id. (internal quotation marks omitted). Once the prevailing party
has demonstrated that particular costs are statutorily authorized, the unsuccessful party

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bears the burden of showing that the costs are somehow improper, and cannot be
recovered. See Cantrell, 69 F.3d at 459.
Further, there is “ample authority for the proposition that a prevailing party’s
expenses in copying discovery material demanded by the losing side are properly taxed
as costs.” Crandall v. City & Cnty. of Denver, 594 F. Supp. 2d 1245, 1256 (D. Colo.
2009). 1 In fact, “[t]he costs incurred by the winning side in responding to evidencegathering requests is an expense that is logically shifted to the losing side.” Id. The risk
of being charged with the costs of complying with one’s own discovery requests
encourages parties “to make narrow, focused discovery requests, rather than going on
broad, potentially expensive, fishing expeditions.” Id.
Moreover, courts have recognized that 28 U.S.C. § 1920(4) includes e-discovery
related costs. Nero v. Am. Family Mut. Ins. Co., No. 11-CV-02717-PAB-MJW, 2013 WL
5323262, at *3 (D. Colo. Sept. 23, 2013) (Defendant “is entitled to recover as taxable
costs the amount spent on loading data into an electronic database and converting files
to TIFF or PDF formats”); Country Vintner of N. Carolina, LLC v. E. & J. Gallo Winery,
Inc., 718 F.3d 249, 260 (4th Cir. 2013) (holding that § 1920(4) includes taxable costs to
“converting electronic files to non-editable formats and burning the files onto discs”);
Race Tires Am., Inc. v. Hoosier Racing Tire Corp., 674 F.3d 158, 171 (3d Cir. 2012)
(“[T]he scanning of hard copy documents, the conversion of native files to TIFF, and the
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Citing Watkins & Son Pet Supplies v. Iams Co., 197 F.Supp.2d 1030, 1037 (S.D. Oh. 2002); Alexander
v. CIT Technology Financing Services, 222 F.Supp.2d 1087, 1089 (N.D. Ill. 2002); Schering Corp. v.
Amgen, Inc., 198 F.R.D. 422, 428 (D. Del. 2001); U.S. E.E.O.C. v. W&O, Inc., 213 F.3d 600, 623 (11th
Cir. 2000).

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transfer of VHS tapes to DVD involved ‘copying,’ . . . the costs attributable to only those
activities are recoverable under § 1920(4)’s allowance for the ‘costs of making copies of
any materials.’”).
In this case, Defendants hired a third-party vendor, Cyopsis, to retrieve and
restore ESI to produce documents sought by Plaintiffs’ Interrogatories and Requests for
Production dated October 6, 2010. For instance, Plaintiffs requested “all documents or
things, including but not limited to, correspondence, summaries, emails, reports, and
memos relating to any communication about CATS since 2004, including, but not limited
to a complete copy of the DBH/ADAD file regarding CATS’ treatment and controlled
substances licenses.” (Doc. # 67, 4.) Because of the complexities and time-intensive
efforts anticipated in responding to Plaintiffs’ requests for documents, the parties
entered into three consecutive tolling agreements, dated December 13, 2010, March 29,
2011, and July 20, 2011. Further, Defendants wrote to Plaintiffs’ counsel three times
describing the difficulties and complexities encountered in retrieving and restoring the
ESI: (1) April 8, 2011, providing detailed information on the scope of the ESI, storage,
archival methods and practices, and retention periods concerning numerous categories
of information on stored servers, hard drives, back-up tapes, personal computers, and
laptops; (2) May 26, 2011, detailing Cyopsis’ efforts of obtaining the ESI, which included
the restoration of 83 back-up tapes; and (3) July 20, 2011, when Cynopsis’ Principal
Forensic Investigator and Director of Litigation Support, John T. Bryan, wrote a letter
describing the difficulties and complexities encountered in the restoration and
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conversion effort. Thus, Plaintiffs were well aware that Defendants required the
services of an outside consultant in order to produce the information requested, and
they were kept apprised of the difficulties encountered by the vendor, Cyopsis. At no
time during this period did Plaintiffs initiate discussion aimed at limiting the scope of
their request for information or take other measures to limit the costs of the endeavor.
Based on the production of the ESI, Plaintiffs filed a new Complaint including several
allegations not included in the version filed in 2010.
The Court finds that Defendants’ costs related to the ESI are expenses
enumerated in 28 U.S.C. § 1920(4). The ESI expenses were not merely for the
convenience of the parties nor were they materials produced solely for discovery as
Plaintiffs filed a new Complaint that included information gleaned from the ESI. Thus,
the ESI expenses were reasonably necessary for use in the case. Indeed, Plaintiffs
were aware of the monumental effort to retrieve and convert the data into a retrievable
format in response to their Interrogatories and Requests for Production. The costs
incurred by Defendants, the prevailing party, in responding to Plaintiffs’ requests are
expenses that are shifted to Plaintiffs, the losing party. Indeed, Plaintiffs own litigation
choices and aggressive course of discovery necessarily resulted in “heightened”
defense costs. See In re Williams Sec. Litig—WCG Subclass, 558 F.3d at 1150.
Plaintiffs have not demonstrated that these costs are improper. Accordingly,
Defendants are entitled to recover their costs in full measure as determined by the
Clerk, which it has identified as $57,873.61.
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III.

CONCLUSION

Accordingly, it is hereby ORDERED that Plaintiffs’ Motion to Review Clerk’s
Taxing of Costs Under F.R.C.P. 54(D)(1) (Doc. # 66) is DENIED. Defendants are
awarded $57,873.61 in costs.
DATED: February

13

, 2015

BY THE COURT:

_______________________________
CHRISTINE M. ARGUELLO
United States District Judge

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