Klayman v. Freedom's Watch, Inc.
Klayman v. Freedom's Watch, Inc.
2008 WL 5111293 (S.D. Fla. 2008)
December 4, 2008

Huck, Paul C.,  United States District Judge

Cost Recovery
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Summary
The Court denied the Defendants' request for fees regarding electronic discovery expenses, as the costs they incurred in collecting electronic material for discovery were not allowed as reasonable costs under 28 U.S.C. § 1920(4). The Court noted that the Defendants had hired an outside firm to collect the electronic documents at an average hourly charge of approximately $350.00 per hour.
LARRY KLAYMAN, Plaintiff,
v.
FREEDOM'S WATCH, INC., BRADLEY BLAKEMAN, ARI FLEISCHER, MEL SEMBLER, WILLIAM P. WEIDNER, and MATTHEW BROOKS, Defendants
Case No.: 07-22433-CIV-HUCK/O'SULLIVAN
United States District Court, S.D. District of Florida
December 04, 2008

Counsel

Larry Elliot Klayman, Klayman Law Firm, Miami, FL, for Plaintiff.
Justin Brian Uhlemann, McDermott Will & Emery LLP, Miami, FL, George Borababy, Mitchell R. Berger, Heather M. McPhee, Patton Boggs LLP, John J. Dabney, McDermott Will & Emery, Thomas G. Hentoff, Williams & Connolly, William Ryan Teague, Washington, DC, for Defendants.
Huck, Paul C., United States District Judge

ORDER AFFIRMING REPORT AND RECOMMENDATION; GRANTING IN PART AND DENYING IN PART DEFENDANT'S FIRST AMENDED MOTION FOR TAXATION OF COSTS AND DENYING DEFENDANT'S SECOND AMENDED MOTION FOR TAXATION OF COSTS

*1 THIS CAUSE comes before the Court upon Defendant's First Amended Motion for Taxation of Costs filed on April 24, 2008 (“First Amended Motion”) (D.E. # 152) and Defendant's Second Amended Motion for Taxation of Costs filed on September 22, 2008 concerning electronic discovery expenses only (“Second Amended Motion”) (D.E.# 188). The Honorable John J. O'Sullivan, United States Magistrate Judge, issued a Report and Recommendation on the Defendant's First Amended Motion on September 9, 2008 (D.E.# 181) (the “First Report and Recommendation”). The Plaintiff and Defendants objected to the First Report and Recommendation. On September 12, 2008, the Court issued an order ratifying and affirming the First Report and Recommendation as to all issues except the issue of electronic discovery expenses. The issue of electronic discovery expenses was remanded to Magistrate Judge O'Sullivan. The Defendants filed their Second Amended Motion providing further information with respect to electronic discovery costs on September 22, 2008 (D.E.# 188). Magistrate Judge O'Sullivan issued a Report and Recommendation on the Defendants' Second Amended Motion on November 18, 2008 (the “Second Report and Recommendation”) (D.E.# 197).
Defendants have not objected to the Second Report and Recommendation, so they are not challenging the factual findings contained in it. The Court has independently reviewed the First Report and Recommendation, the Second Report and Recommendation, and the record. Being otherwise duly advised, the Court adopts the findings of fact and conclusions as in the reports. Accordingly, it is hereby
ORDERED AND ADJUDGED the First Report and Recommendation and Second Report and Recommendation are ADOPTED and, in accordance with Magistrate Judge O' Sullivan's recommendations therein, Defendants' First Amended Motion is GRANTED IN PART AND DENIED IN PART, the Defendants' Second Amended Motion is DENIED. If payment is not made within a reasonable period of time, Defendants may apply for entry of a final judgment as to costs.
DONE AND ORDERED.
JOHN J. O'SULLIVAN, United States Magistrate Judge.
THIS MATTER is before the Court on the Defendants Freedom's Watch, Bradley Blakeman, Ari Fleischer, Mel Sembler, William P. Weidner, and Matthew Brooks' Second Amended Motion for Taxation of Costs (DE # 188, 9/22/08). This matter was referred to United States Magistrate Judge John J. O'Sullivan by United States District Court Judge Huck, United States District Court Judge for the Southern District of Florida pursuant to 28 U.S.C. § 636(b). Having reviewed the applicable filings and law, the undersigned respectfully recommends that the Defendants Freedom's Watch, Bradley Blakeman, Ari Fleischer, Mel Sembler, William P. Weidner, and Matthew Brooks' Second Amended Motion for Taxation of Costs (DE # 188, 9/22/08) be DENIED as more fully explained below.
This matter is before the Court on the issue of electronic discovery expenses only. The undersigned previously issued a Report and Recommendation as to the other costs requested by the defendants. The undersigned was directed by Judge Huck to issue a report and recommendation as to electronic discovery expenses (DE# 186, 9/12/08). Accordingly, the undersigned issues the following Report and Recommendation.
*2 The defendants ask the Court to award the defendants costs of $150,000.00 for expenses they incurred in collecting electronic material for discovery. The defendants hired an outside firm to collect the electronic documents. The outside firm charged from $175.00 to $600.00 per hour to perform their search for electronic documents. The average hourly charge was approximately $350.00 per hour.[1]
The defendants cite to Lockheed Martin Idaho Technologies Co. v. Lockheed Martin Advanced Environmental Systems, Inc., 2006 WL 2095876 (D.Idaho), to support their claim for costs. In Lockheed, the district court in Idaho allowed the plaintiff to tax costs pursuant to 28 U.S.C. § 1920(4) for $4.6 million expended by the plaintiff for the creation of a litigation database. 28 U.S.C. § 1920(4) allows for the taxation of costs for “fees for exemplification and copies of papers necessarily obtained for use in the case.”
The defendants in the case at hand have not explained how the $150,000.00 paid to an outside consultant to collect documents is allowed as reasonable costs under 28 U.S.C. § 1920(4). It appears that the defendants hired experts at a huge hourly cost to search for and retrieve discoverable electronic documents. In a non-electronic document case this work would be performed by paralegals and associate attorneys and would not be compensable as costs under 28 U.S.C. § 1920. The only costs that would be reimbursable would be the actual cost of the photocopy (at perhaps 15 cents per copy), not the hourly costs of collecting the documents. A court may only tax those costs which are specifically authorized by statute. See Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 445, 107 S.Ct. 2494, 96 L.Ed.2d 385 (1987). The defendants' request for fees regarding electronic discovery expenses should be denied.
In accordance with the above and foregoing, it is hereby
RECOMMENDED that the defendants not be awarded costs associated with electronic discovery expenses and that the Defendants Freedom's Watch, Bradley Blakeman, Ari Fleischer, Mel Sembler, William P. Weidner, and Matthew Brooks' Second Amended Motion for Taxation of Costs (DE # 188, 9/22/08) be DENIED. The parties may file and serve written objections to this Report and Recommendation with the Honorable Paul Huck, United States District Judge, within ten (10) days of receipt. See 28 U.S.C. § 636(b) (1)(c); United States v. Warren, 687 F.2d 347 (11th Cir.1982), cert. denied, 460 U.S. 1087, 103 S.Ct. 1781, 76 L.Ed.2d 351 (1983); and Hardin v. Wainwright, 678 F.2d 589 (5th Cir. Unit B 1982); see also Thomas v. Arn, 474 U.S. 140, 106 S.Ct. 466, 88 L.Ed.2d 435 (1985). Failure to file objections timely shall bar the parties from a de novo determination by the District Judge of an issue covered in this Report and Recommendation and shall bar the parties from attacking on appeal factual findings accepted or adopted by the District Court except upon grounds of plain error or manifest injustice. See 28 U.S.C. § 636(b)(1); Nettles v. Wainwright, 677 F.2d 404, 410 (5th Cir. Unit B 1982) (en banc).
*3 DONE and ORDERED, in chambers, in Miami, Florida, this 18th day of November, 2008.

Footnotes

In addition, the defendants request to be reimbursed for airfare, hotels, car service, parking, meals, cell phone and FedEx charges incurred by their hired consultants.