It’s been a little while since we’ve addressed the costs of eDiscovery here at IT-Lex, so right on cue, there’s a recent Fourth Circuit opinion that concerns this precise topic. The case is Country Vintner of North Carolina v. E. & J. Gallo Winery, where Gallo had already been granted a summary judgment in the underlying unfair trade practices action. In its bill of costs, Gallo sought $111,047.75 “for charges related to ESI.” Country Vintner contested this sum, and a district court judge slashed the amount to $218.59. Not happy about only being awarded 0.002% of what they asked for, Gallo appealed to the Fourth Circuit, and that brings us up to date.

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By Brandi Walkowiak (bio)

On April 1, 2013, a federal judge in the In re Citigroup Inc. Securities Litigation, Case No. 1:09-md-02070 (SDNY), ordered a plaintiff firm to produce, among other things, information regarding the rates charged for its contract attorneys’ document review as well as evidence to establish that such rate was reasonable.  The dispute emerged in the context of a proposed $590 million settlement between Citigroup and investors claiming that the bank hid its financial exposure in toxic mortgage debt.  In the proposed settlement, plaintiff firm Kirby McInerney sought $100 million in fees which included rates it charged for contract attorneys at $500 per hour or more. Contract attorneys hired directly may charge more in the realm of $25-80 per hour.

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In the recent California case Eaglesmith v. Ray, the defendants had already prevailed on summary judgment against two of the four plaintiffs, and were now seeking to recover costs. Plaintiffs disputed the allocation of these for a variety of reasons, and filed a Motion to Review Taxation of Costs, and in late March, the court issued its order.

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Sometimes it’s hard to keep track of all the ongoing litigation that Apple is caught up in. In addition to the epic battle with Samsung, and the fight with Amazon, there’s also a privacy case, simply entitled In re Apple Inc. iPhone/iPad Application Consumer Privacy Litigation, currently underway in the Northern District of California. The root of the case: “Apple is accused in the lawsuit of collecting data on the locations of customers through iPhones, even after the device’s geo-location feature was turned off.” Plaintiffs’ lawyers in this case have complained that Apple has not been responding to discovery requests in a timely manner, and Magistrate Judge Paul S. Grewal is not impressed.

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By IT-Lex Intern Joey Chindamo (LinkedIn)

Here at IT-Lex.org, we cover cost-shifting in eDiscovery fairly often. In fact, this post is barely a week old. A recent case out of New Jersey, Juster Acquisition Co., LLC v. North Hudson Sewerage Authority, dealt with this issue, and in a concise opinion, Magistrate Judge Michael Hammer relied upon the Zubulake Factors to determine whether cost-shifting was appropriate. The Zubulake Seven-Factor test originated from Zubulake v. UBS Warburg, LLC [PDF] a seminal 2003 New York case.

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By IT-Lex Intern Shannon Allen (LinkedIn)

Regular IT-Lex readers are aware of the often litigated subject of eDiscovery cost shifting.  Nobody likes to have to pay for anything, so who should pay for what parts of eDiscovery and when?  There are two recent cases that address this topic with different results.

We begin with civil litigation on the west coast, in the February 6, 2013 case of Connecticut General Life Insurance Co. v. Earl Scheib, Inc., where the Defendant “object[ed] that the cost of production in response to . . . discovery requests, when considered against the claim itself, render[ed] production unduly burdensome.”

The California court agreed.

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By IT-Lex Intern Joey Chindamo (LinkedIn)

A fascinating eDiscovery case out of Maryland federal court last month could be a game-changer in the area of electronically stored information (ESI).

The United States District Court for the District of Maryland released its opinion in Branhaven, LLC v. Beeftek, Inc. [PDF] on January 4. The court imposed sanctions against the Plaintiff, Branhaven, and also imposed sanctions on Plaintiff’s counsel, for discovery violations on multiple grounds after defense counsel complained about “discovery abuses intended to harass defendants, cause unnecessary delay, and needlessly increase the cost of litigation[.]”

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By David W. Magana (bio)

You may remember that in 2008, Magistrate Judge Barbara L. Major dinged Qualcomm for $8.5 million in a widely discussed order finding that six of Qualcomm’s outside attorneys had intentionally withheld thousands of relevant documents in discovery. See Qualcomm Inc. v. Broadcom Corp., 2008 WL 66932 (S.D. Cal. Jan. 7, 2008). Those six attorneys were later absolved by attorney-client email correspondence establishing that Qualcomm had misled them regarding the existence of the withheld documents.

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In Peerless Indus., Inc. v. Crimson AV, LLC (N.D. Ill. Jan. 8, 2013), another court made it clear that a law firm or litigant can’t just rely on an outside vendor to handle the process associated with eDiscovery preservation, collection, search, and review- and it is not okay to “take a back seat approach and instead let the process proceed through a vendor.”  Particularly when the best answer a deponent can give regarding what efforts were undertaken is that they were handled “I guess by the vendor . . . .”  As you can guess, this is a sanctions case.

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By IT-Lex Intern Shannon Allen (LinkedIn)

Last month’s 14 page In re: Waste Management of Texas, Inc. opinion details an antritrust action between two competing sanitation companies and their lengthy eDiscovery journey. Pertinently:

 “In late 2009—in response to an order that compelled the production of various internal business records but reserved for a later decision the question of whether the production must include metadata—[perhaps because neither party understood the importance of metadata] Waste Management produced responsive records in the format of its choice, Adobe portable document format (PDF).” [emphasis added]

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