Summary
noting that parties had entered into discovery agreement that provided that "the party seeking expert discovery would reimburse the other for expert witness fees up to four hours of preparation time and for the actual time spent in deposition."
Summary of this case from AMX CORPORATION v. PILOTE FILMSOpinion
Civil Nos. 3:00-CV-2029-H, 3:03-CV-0508-H, 3:03-CV-0787-H.
May 24, 2004
FINDINGS, CONCLUSIONS, AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE
Pursuant to the District Court's Order of Reference, entered January 7, 2004, Defendant Explorer's Corrected Bill of Costs, filed January 6, 2004, has been referred to the United States Magistrate Judge for hearing, if necessary, and for recommendation. Also before the Court is Explorer's Motion to Enforce Discovery Agreement, filed March 11, 2004.
I. Background
On November 25, 2003, the District Court dismissed Plaintiffs' claims against Explorer. On December 9, 2003, Explorer filed a Bill of Costs totaling $71,663.63. Explorer then filed a Corrected Bill of Costs totaling $93,759.27. However, during a hearing on this matter on March 1, 2004, Explorer agreed to reduce its total costs to $61,532.58. Here, Plaintiffs do not object to the Bill of Costs as to filing fees ($150.00) and service fees ($187.50). Plaintiffs do, however, contest the propriety of the sums demanded for Court Reporter fees ($25,718.34), witness fees ($4,354.17), and copy costs ($31,460.07).
The parties entered into a discovery agreement regarding reimbursement for expert witness fees. Therefore, the total reflects the actual amount sought by Explorer, which includes the witness fees that are subject to the discovery agreement.
Reduced from $34,614.89 at the March 1, 2004, Hearing.
On March 11, 2004, Explorer filed its "Motion to Enforce Discovery Agreement," in which it claims $4,354.17 for reasonable expert witness fees (the difference between the $18,480.00 — reduced from $22,265.50 in its original Bill of Costs — Explorer seeks in reimbursement, and the $14,125.83 Explorer claims that it owes Plaintiffs). Plaintiffs, in the March 24, 2004, response, claims that Explorer is only entitled to $274.17 for reasonable expert witness fees (the difference between the $17,700.00, which Plaintiffs claim is an appropriate reimbursement, and the $17,425.83 of which Plaintiffs are entitled for reimbursement).
Explorer originally sought $14,445.74 in copy costs. It then filed a Corrected Bill of Costs in which it added $22,095.64 for its costs incurred copying trial exhibits, bringing the total amount of fees for exemplification and copies to $36,541.38. However, the $14,445.74 was reduced to $9,364.43 at the March 1, 2004, Hearing.
II. Analysis
"Costs other than attorneys' fees shall be allowed as of course to the prevailing party unless the court otherwise directs." FED.R.CIV.P.54(d)(1). However, only those costs provided for under 28 U.S.C. § 1821 and 1920 may be taxed against the losing party. These costs include: (1) fees paid to the clerk and marshal; (2) fees paid to the court reporter or stenographer for all or part of the stenographic transcript necessarily obtained for use in the case; (3) witness fees and related expenses; (4) printing costs; (5) fees for exemplification and copies of papers necessarily obtained for use in the case; and (6) fees of court appointed experts, interpreters and special interpretation services. 28 U.S.C. § 1821, 1920.
Moreover, the party seeking costs bears the burden of supporting its request with evidence documenting the costs incurred and proof, when applicable, that a certain item was "necessarily obtained for use in the case." Fogleman v. ARAMCO, 920 F.2d 278, 285-86 (5th Cir. 1991). The Fifth Circuit accords the district courts "great latitude" in making this factual determination. Id. Although a district court may decline to award court costs listed in the statute, it may not award costs omitted from the statute. Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 441-42 (1987); Coats v. Penrod Drilling Corp., 5 F.3d 877, 891 (5th Cir. 1993), cert. denied, 510 U.S. 1195 (1994). After reviewing the motion, Plaintiffs' responses thereto, and 28 U.S.C. § 1821 and 1920, the Court makes the following findings.
A. Court Reporter Fees
Explorer seeks a total of $25,718.34 in Court Reporter fees. "A prevailing party is entitled to recover the costs of taking, transcribing, and reproducing depositions that are `necessarily obtained for use in the case.'" Harris Corp. v. Sanyo N. Am. Corp., No. 3:98-CV-2712-M, 2002 U.S. Dist. LEXIS 3608, at *9 (N.D. Tex. Mar. 5, 2002) (quoting 28 U.S.C. § 1920(2)). Here, Plaintiffs object that these costs are exorbitant, excessive, and not allowed by the rules. Specifically, Plaintiffs claim that Explorer is not entitled to cost reimbursement for taking multiple depositions of the same parties, and for taking depositions that were for "discovery or investigative purposes."
$18,779.03 for deposition transcription costs, and $6,939.31 for deposition reproduction costs.
1. Deposition Transcription Costs
Explorer seeks $18,779.03 for deposition transcription costs. "[E]ven if the court did not rely on plaintiff's deposition in ruling on defendants' motion for summary judgment, the relevant inquiry is whether the deposition `reasonably seemed necessary at the time it was taken.'" Tittle v. Raines, No. 3:99-CV-0478-L, 2002 U.S. Dist. LEXIS 21171, at *5-6 (N.D. Tex. Oct. 31, 2002) (citing Manildra Milling Corp. v. Ogilvie Mills, Inc., 878 F. Supp. 1417, 1427 (D. Kan. 1995), aff'd, 76 F.3d 1178 (Fed. Cir. 1996)). Here, counsel for Explorer stated that it was necessary to take two different sets of depositions from the same persons because each related to different issues. Specifically, Explorer's counsel stated that because Plaintiffs originally attempted to have this case certified as a class action, the first set of depositions pertained solely to class certification, while the second set of depositions pertained to the substantive issues involved in the case. Additionally, "[t]he fact that defense counsel wanted this deposition to fully understand the factual basis of plaintiff's claims does not mean that the deposition was taken primarily for discovery or investigative purposes." Tittle, 2002 U.S. Dist. LEXIS 21171, at *6. Accordingly, Explorer is entitled to recover $18,779.03 in deposition transcription costs.
2. Deposition Reproduction Costs
Plaintiffs also object to Explorer's demand for reimbursement of deposition copies, which Explorer subsequently reduced to $6,939.31 at the March 1, 2004, hearing. Explorer stated that these deposition copies relate to the depositions of both Plaintiffs' experts and Explorer's experts, and that they were necessarily obtained for use in the case. (March 1, 2004, Hearing). "However, costs should not be disallowed merely because the deposition was not ultimately used at trial or in connection with a dispositive motion." Harris, 2002 U.S. Dist. LEXIS 3608, at *10. Furthermore, just as "it is reasonable for a defendant to depose the plaintiff in a lawsuit," Tittle, 2002 U.S. Dist. LEXIS 21171, at *6, it also reasonable to make copies of those deposition transcripts. Here, Explorer has demonstrated that the invoices for the deposition copying costs were necessarily obtained for use in the case. Therefore, Explorer is also entitled to recover the additional $6,939.31 in deposition reproduction costs. B. Witness Fees
Wright Watson Inv. No. 110067 ("one copy of deposition," $416.39), Inv. No. 110109 ("one copy of deposition," $246.47), Inv. No. 110075 ("one copy of deposition," $148.28); Ace Inv. No. 141757 ("2 copies of transcript," $360.65), Smith Inv. No. 31277 ("1 copy deposition," $418.50); Allied Inv. Nos. 8068 and 8073 ("original 1 copy," $1,861.90 recoverable for both per Explorer); Spectrum Inv. No. 5684 ("copy of medical/technical transcripts" $234.60); Professional Inv. No. 16784 ("one copy transcript," $2,624.10).
Explorer seeks $4,354.17 in witness fees. Here, the parties have entered into a discovery agreement with regard to these fees. Specifically, counsel for Plaintiffs and Explorer agreed that the party seeking expert discovery would reimburse the other for expert witness fees up to four hours of preparation time and for the actual time spent in deposition. However, subsequent to the close of expert discovery, the parties disagreed on the appropriate amount of reimbursement due the other. Rule 26(b)(4)(C)(i) requires a party seeking discovery from an expert to pay "a reasonable fee for time spent in responding to discovery." FED.R.CIV.P.26(b)(4)(C). Here, the parties have reached an agreement on all of the expert fees except those relating to Explorer's expert, Dr. Ralph d'Arge, and Plaintiffs' experts, Drs. Mohammad Tabrizi and Robert Simons.
This amount is calculated by subtracting what Explorer contends are Plaintiffs' fees of $14,125.83 from Explorer's fees of $18,480.00. Plaintiffs, however, contend that their fees total $17,425.83, and that Explorer is only entitled to $274.17 for reasonable expert witness fees (the difference between the $17,700.00, which Plaintiffs claim is an appropriate reimbursement, and the $17,425.83 of which Plaintiffs are entitled for reimbursement).
Tabrizi and Simons both provided testimony concerning class certification.
1. Dr. Ralph d'Arge
Plaintiffs challenge Dr. d'Arge's billing rate of $450 per hour, contending that this rate far exceeds the billing rates for Explorer's other real property experts, and that "his disclosed billing rate" was $375 per hour. However, in Explorer's Rule 26(a)(2) witness disclosures, Dr. d'Arge's rate was listed as $450 per hour. (D.'s Reply, Ex. A). Explorer's calculation for Dr. d'Arge's total fee of $4,342.50 is based on this hourly rate multiplied by 9.65 hours (four hours of preparation time plus actual time spent in deposition). The Court determines that his hourly rate is reasonable pursuant to Rule 26(b)(4)(C)(i). Therefore, Plaintiffs shall reimburse Explorer $4,342.50 for Dr. d'Arge's expert witness fees.
Specifically, Plaintiffs contend that d'Arge stated in his deposition that his actual billing rate is $375, and that the $450 hourly fee includes an overhead charge for the Law in Economics Consulting Group.
Although Plaintiffs claim that Dr. d'Arge's 9.65 hours should be rounded to 9.5 hours because the parties' expert deposition fee reimbursement requests were calculated in such a manner, there is no evidence in the record that such an express agreement existed between the parties. Furthermore, this argument does not hold water in light of the fact that Plaintiffs have already agreed to reimburse an Explorer expert, Mr. Max Cobb, for 3.75 hours of deposition time.
Explorer contends that the amounts sought by Plaintiffs for reimbursement in connection with Dr. Tabrizi and Dr. Simon's class certification depositions are unreasonable for several reasons. First, the depositions are outside the scope of the parties' agreement because Explorer did not agree to pay travel expenses or preparation time in connection with these depositions. More importantly, Plaintiffs did not raise this issue until January 16, 2004, after the judgment had been issued. Second, Explorer claims that Plaintiffs seek to charge it for costs that are not recoverable, such as report preparation, field trips, and associate assistance. (D.'s Mot. at 3).
2. Dr. Mohammad Tabrizi
Although Explorer contends that a reasonable fee for Dr. Tabrizi's 2002 deposition is $1,225.00, Plaintiffs claim that they are entitled to a reimbursement of $2,975.00. Plaintiffs contend that Dr. Tabrizi traveled to Dallas the day before his deposition and prepared for more than four hours. (P.s' Resp. at 5). Plaintiffs further contend that Tabrizi's fee request is based upon his invoice that he prepared for the deposition for ten hours, and was actually deposed for seven hours. The requested reimbursement of Tabrizi's expert fee is calculated by multiplying $175 per hour by 17 hours. ( Id.).
The sum for the actual time spent by Tabrizi in responding to deposition questions (7 hours) multiplied by his standard hourly rate ($175 per hour).
However, because Rule 26(b)(4)(C) does not include any "guidance on whether `time spent in responding to discovery' includes an expert's time spent preparing for a deposition," Boos v. Prison Health Servs., 212 F.R.D. 578, 579 (D. Kan. 2002), the courts are divided as to whether such time is compensable. While some courts have allowed such preparation time to be compensable because the plain language of the rule calls for such compensation, Collins v. Village of Woodridge, 197 F.R.D. 354, 357-58 (N.D. Ill. 1999), other courts have refused to award compensation for deposition preparation in the absence of compelling circumstances, such as "complex cases where there has been a considerable lapse of time between an expert's work on a case and the date of his actual deposition." S.A. Healy Co. v. Milwaukee Metro. Sewerage Dist., 154 F.R.D. 212, 214 (E.D. Wis. 1994).
Here, however, this Court agrees with Collins, and determines that the plain language of the Rule allows "compensation for `time spent in responding to discovery,' and not just time spent at the deposition." Profile Prods., LLC. v. Soil Mgmt. Techs., Inc., 155 F. Supp.2d 880, 886 (N.D. Ill. 2001) (citing United States v. Ron Pair Enters., Inc., 489 U.S. 235, 241 (1989) (Plain language governs in statutory interpretation)). "The [ Collins] court rationalized that the Rule's drafters could have easily drafted the rule to limit recovery to the time the expert actually spent appearing at the deposition." Boos, 212 F.R.D. at 580. Specifically, the Collins court stated:
Either the phrase "time spent responding to discovery" includes deposition preparation time, or it does not. If it does not, then there is no basis under Rule 26(b)(4)(C) or any other provision of the Federal Rules to shift such fees. In short, the Rule on its face does not permit a construction that says that such fees may not be awarded, but still somehow allows for them in unusual or exceptional cases.Collins, 197 F.R.D. at 357.
Although Plaintiffs claim that Dr. Tabrizi "spent more than ten (10) hours preparing for the deposition" (P.s' Resp. at 5), there is no evidence in the record to support the specific amount of time that Dr. Tabrizi actually prepared for the class certification deposition. Rather, the Tabrizi invoice lists 79.2 hours for "document review, report, travel and deposition." (D.'s Reply at 3, Ex. C). However, in light of Dr. Tabrizi's 2002 twenty-page report, which included verification from Dr. Tabrizi that he had reviewed more than twenty documents in preparation of the report, the Court finds that Explorer should compensate Plaintiffs for four hours of Dr. Tabrizi's deposition preparation time, plus seven hours of actual deposition time, at $175 per hour. Therefore, Explorer shall reimburse Plaintiffs $1,925.00, a reasonable fee for Dr. Tabrizi's 2002 deposition.
3. Dr. Robert Simons
Plaintiffs claim that they are entitled to a reimbursement of $4,000.00 for Simons's deposition, for which he charged Plaintiffs a flat fee of $4,000.00. Here, it is undisputed that Simons's actual deposition time was seven hours, and that Simons's hourly rate is $350 per hour. However, a $4,000.00 charge results in an hourly rate of $571 per hour (based on seven hours of deposition time), a fee which Plaintiffs claim "is reasonable if the Court allows some limited amount of preparation time in addition to the time that Simons spent in his deposition." (P.s' Sur-Reply at 4) (emphasis added).
Here, the Court will not allow a limited amount of preparation time in addition to the seven hours that Simons spent in his deposition. Simons's invoice includes a specific charge of $8,400.00 for "Administration, research, conf. calls, data analysis, field trip to Dallas, one expert report and deposition preparation." (D.'s Mot., Ex. F) (emphasis added). Therefore, Simons has already billed Plaintiffs for his deposition preparation at his hourly rate of $350 per hour. ( Id.). However, even assuming arguendo that Simons had not already billed Plaintiffs at $350 per hour, the Court determines that this substantial increase in fees is unreasonable. See Cabana v. Forcier, 200 F.R.D. 9 (D. Mass. 2001); Frederick v. Columbia Univ., 212 F.R.D. 176 (S.D.N.Y. 2003).
Accordingly, $2,450.00 is a reasonable amount based on the actual time spent in deposition (seven hours) multiplied by Simons's standard hourly rate of $350 per hour. Therefore, Explorer's Motion to Enforce Discovery Agreement is granted in part and denied in part, and Explorer is thus awarded $3,654.17 for reasonable expert fees pursuant to Rule 26(b)(4)(C) and the parties' agreement. C. Copy Costs
It is granted as to the $4,342.50 for Dr. d'Arge's expert witness fees, and as to its objection to the increased billing of Dr. Simons's class certification deposition. The motion is denied as to Explorer's objection to the reasonableness of Dr. Tabrizi's class certification deposition.
This amount is calculated by subtracting Plaintiffs' fees of $14,825.83 from Explorer's fees of $18,480.00.
Explorer seeks $31,460.07 for copy costs. Section 1920(4) permits an award of costs for "exemplification and copies of papers necessarily obtained for use in the case." 28 U.S.C. § 1920(4). This section includes costs for photocopies as well as costs for various types of non-testimonial evidence, including photographs, maps, charts, and graphs. Studiengesellschaft Kohle mbH v. Eastman Kodak Co., 713 F.2d 128, 132-33 (5th Cir. 1983). In order to recover costs for copying and exemplification, one must establish that such items were "necessarily obtained" for use in the trial. Holmes v. Cessna Aircraft Co., 11 F.3d 63, 64 (5th Cir. 1994). The Court must make an express finding of fact that the evidence produced or the copies made were actually necessary.
Here, Plaintiffs' first objection concerns the expenses for copies of trial exhibits. Plaintiffs contend that Explorer should have obtained pre-approval from the Court for copies of photos and exhibits before taxing those items as costs. Specifically, these costs include the $22,095.64 contained in Explorer's Corrected Bill of Costs, and also the amounts contained in the invoices attached to the original Bill of Costs, which refer to color copies, oversized documents, images, and "color oversized impressions." These invoices amount to a total of $9,364.43 in copying costs. However, contrary to Explorer's contention that Plaintiffs have made a "confusing argument" regarding pretrial approval of copies of trial exhibits, the Fifth Circuit has held that "absent pretrial approval of the exhibits . . . a party may not later request taxation of the production costs to its opponent." Louisiana Power Light Co. v. Kellstrom, 50 F.3d 319, 335 (5th Cir. 1995); see also Harris, 2002 U.S. Dist. LEXIS 3608, at *5-6 (disallowing copying of trial exhibits to be taxed because the plaintiff failed to obtain pretrial approval); Super Sack Mfg. Corp. v. Chase Packaging Corp., No. 3:88-CV-1963-P, 1995 U.S. Dist. LEXIS 20232, at *16 (N.D. Tex. Oct. 19, 1995) ("The law in this Circuit permits taxation of costs for demonstrative evidence only if there is pre-trial authorization by the trial court."). "Case law therefore indicates that a court should prohibit reimbursement of copies used as trial exhibits unless the prevailing party obtained pretrial approval for the making of the exhibits." Auto Wax Co., Inc. v. Mark V Prods., Inc., No. 3:99-CV-0982-M, 2002 U.S. Dist. LEXIS 2944, *21 (N.D. Tex. Feb. 22, 2002). Here, Explorer has failed to submit any evidence that the District Court authorized the taxation of such costs. Accordingly, the Court finds that the $22,095.64 expended by Explorer for copies of trial exhibits are not taxable costs.
Explorer's Motion for Leave to file the Corrected Bill of Costs described this additional amount as "a significant additional expense for copies of trial exhibits." (D.'s Mot. for Leave to File CBOC at 1) (emphasis added).
LDM Inv. Nos. 2218, 2289, 2315, 2140, 2184, 2201, 2196, 2197, 1886, and 1922 (referring to color copies and oversized documents); Medlen Inv. No. 78547 (referring to 2000 "images" at a cost of $303.73); Merrill Inv. No. 1600-318902 (requesting $1,296.00 for "color oversized impressions").
With regard to the remaining $9,364.43 contained in the invoices attached to the original Bill of Costs, although Explorer is not required to "identify every xerox copy made for use in the course of legal proceedings, [the Fifth Circuit] require[s] some demonstration that reproduction costs necessarily result from that litigation." Fogleman, 920 F.2d at 286; see also Harris, 2002 U.S. Dist. LEXIS 3608, at *6 (stating that the prevailing party "must demonstrate some nexus between the costs incurred and the litigation."). Here, even assuming arguendo that these costs were not disallowed as "trial exhibit copies," "the invoice[s] do not categorize the photocopies so that the Court may reasonably decipher the copies which were necessary and those which were not." Datapoint Corp. v. Picturetel Corp., No. 3:93-CV-2381-D, 1998 U.S. Dist. LEXIS 10897, at *18 (N.D. Tex. July 9, 1998); see also Harris, 2002 U.S. Dist. LEXIS 3608, at *9 ("This description is far too vague to permit the Court to determine whether these costs are recoverable."). Therefore, the Court also finds that the remaining $9,364.43 contained in the invoices attached to the original Bill of Costs are not taxable.
Many of these invoices contain the identical descriptions as the invoice attached to the Corrected Bill of Costs, which pertains solely to trial exhibit copies. For example, "Medium Litigation Copying," "11 × 17 Copies," 8.5 × 11 Color Copies," "11 × 17 Color Copies," "Oversize documents (per sq. ft.)," "Color oversize documents scanned (per sq. ft.)," "Color Oversize documents plotted (per sq. ft.)," "Index Tabs," "Custom Tabs," "Video Duplication," and "CD Duplication."
III. Conclusion
For the foregoing reasons, Explorer's Bill of Costs seeking costs in the amount of $61,532.58 will be reduced in the following amounts:
WITNESS FEES: $ 700.00 COPY COSTS: $31,460.07 ___________________________________ TOTAL: $32,160.07
This Court recommends that the District Court order the Clerk to deduct $32,160.07 from Explorer's Bill of Costs, and award Explorer costs of $29,372.51.
SO RECOMMENDED.