*1 On March 23, 2016, nonparty subpoena respondent Availity, LLC filed a Petition for Fees and Costs. For the reasons set forth below, the Court recommends that an order be issued requiring Plaintiffs to pay $5,337.50 in fees and costs to Availity.

On July 6, 2015, Defendants issued a Rule 45 subpoena to nonparty Availity, requesting claims data relevant to this case (Subpoena).[1] On November 20, 2015, Availity appeared at a status hearing, at the Court's request. (Dkt. 228, 240). At that hearing, Availity agreed to produce claims data by January 12, 2016, in a native, standard format agreed to by Plaintiffs’ expert. (Id.). The Court also ordered Plaintiffs to provide customer ID numbers to Availity by November 25, 2015, but they failed to do so. (Dkt. 228, 240, 266). Nevertheless, Availity was able to identify customer ID numbers for three of the Emerus entities. (Dkt. 266).

On November 25, 2015, Plaintiffs advised Availity for the first time that certain of Emerus entities used Visualutions to transmit their data to Availity. (Dkt. 266). This disclosure, which Emerus should have been aware of prior to the November 20 hearing, “complicated” Availity's ability to provide the requested data. (Id.). On December 9, Availity advised Plaintiffs that it could not produce the Visualutions data because the data might include non-Emerus data precluded from disclosure pursuant to HIPAA regulations. (Id.).

On January 14, 2016, Availity produced the data in the method approved by Plaintiffs, which Plaintiffs acknowledged on both January 22 and February 1. (Dkt. 262, 266, 267, 268, 278). Nevertheless, on February 2, Plaintiffs’ expert determined that when he tried to open the Availity data files, no claims data had been provided. (Dkt. 273, 278). Availity immediately initiated an investigation and on February 5, acknowledged that while it had provided Plaintiffs with a list of the files produced, it had inadvertently failed to produce the files themselves. (Dkt. 278, 300). Availity loaded the files and gave Plaintiffs detailed instructions for how their expert could access the information. (Id.). Availity also informed Plaintiffs that its production included only 837 data, “which suggests to Availity that the Plaintiffs whose data Availity possesses did not register with [Defendants] to have 835s delivered through Availity.” (Id.). Availity requested that Plaintiffs confirm that their expert is able to access the data: “Please ask Mr. Hatchett to access the data right away, and confirm as soon as possible that he has been able to access the data,” but Plaintiffs’ counsel never responded. (Id.).

*2 On February 10, 2016, Plaintiffs’ expert informed Plaintiffs’ counsel that he was having some “typical cleaning and normalization” challenges in merging the claims data from various clearinghouses into spreadsheets, but did not mention any specific issues with Availity data.[2] (Dkt. 288). On February 25, Plaintiffs’ expert again noted some routine problems in converting the claims data into the spreadsheets but emphasized that “there are no big problems on my end. It is just an issue of time.” (Dkt. 298).

On February 26, 2016, Plaintiffs informed the Court that the claims data received from Availity was not “usable.” (Dkt. 299). The Court ordered the parties, along with Availity's counsel and Plaintiffs’ expert, to meet and confer in an attempt to resolve the issue. (Id.). Availity's representatives, including Matt Henderson, associate general counsel, Andy Young, director of production assurance, and Charles Gering, outside counsel, conferred with the parties and Plaintiffs’ expert on March 2, 2016. (Dkt. 302). Plaintiffs’ expert said that the only issue he had with the data produced by Availity is that he did not find any 835 data. (Id.). When asked, Plaintiffs’ expert asserted that he was not made aware of the email sent by Availity to Plaintiffs’ counsel on February 5, informing Plaintiffs that Availity did not have any 835 data. (Id.). The expert said he had “no further questions” regarding the data production. (Id.). Availity reiterated that other than the Visualutions data—which Plaintiffs were seeking directly from Visualutions—all responsive data has been produced. (Id.).

At the March 4, 2016 hearing, the Court reviewed the chronology of the Availity production and determined that Availity had fully complied with the Subpoena on February 5, 2016. (Dkt. 309). Accordingly, the Court invited Availity to file a petition for fees for any time spent after that date responding to Plaintiffs’ assertion that the data produced was “unusable.” (Id.). Availity filed its petition for fees on March 23, and on April 26, Plaintiffs filed a response.

As an initial matter, “[t]he Seventh Circuit has held that the matter of ‘sanctions’—the Court has used the term without qualification—is for the district court, and that a magistrate judge can only issue a report and recommendation.” Clever-safe, Inc. v. Amplidata, Inc., 287 F.R.D. 424, 427 (N.D. Ill. 2012). In Ret. Chicago Police Ass'n v. City of Chicago, 76 F.3d 856, 868–69 (7th Cir. 1996), the Seventh Circuit was unequivocal: the “resolution of a sanctions request is a dispositive matter capable of being referred to a magistrate judge only under § 636(b)(1)(B) or § 636(b)(3), where the district judge must review the magistrate judge's report and recommendations de novo.” Accord Cleversafe, 287 F.R.D. at 427–28. Accordingly, in ruling on this fee petition, this Court is required to issue a Report and Recommendation to District Judge Gettleman pursuant to Rule 72(b).

Parties have an affirmative duty to protect nonparties from undue burden or expense. Fed. R. Civ. P. 45(d)(1) (“A party or attorney responsible for issuing and serving a subpoena must take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena.”). Further, the Court “must enforce this duty and impose an appropriate sanction—which may include lost earnings and reasonable attorney's fees—on a party or attorney who fails to comply.” Id.; see Elliot v. Mission Trust Servs., LLC, No. 14 C 9625, 2015 WL 1567901, at *6 (N.D. Ill. Apr. 7, 2015) (sanctions are appropriate where a party “failed to take reasonable steps to ensure the subpoena would not result in an undue burden”).

*3 Here, the Court finds that Availity fully responded to the Subpoena on February 5, 2016. By erroneously asserting on February 26 that Availity's production was “unusable,” Plaintiffs subjected Availity to undue expense. Accordingly, Availity is entitled to its reasonable attorney's fees in responding to Plaintiff's error. Fed. R. Civ. P. 45(d)(1).

Plaintiffs do not dispute that Availity is entitled to fees because of Plaintiffs’ and their expert's failure to “read the February 5, 2016 email from Availity's counsel ... more closely.” (Dkt. 326 at 1–2). However, Plaintiffs contend that the majority of fees and costs Availity seeks to recover are unreasonable and unnecessary. (Id. at 2–7). Plaintiffs argue that “the vast majority” of Availity's fees “could have been avoided by a simple phone call or email to Plaintiffs’ counsel.” (Id. at 3). The Court disagrees. First, it is disingenuous for Plaintiffs’ counsel to suggest that Availity's counsel should have called or emailed when the issue of Availity's “unusable” data was raised by Plaintiffs’ counsel to the Court without first contacting Availity. Further, the tortured history of the Subpoena indicates that it was unlikely a call or email would have solved the issue. For example, despite the Court ordering Plaintiffs to provide Availity with a list of customer ID numbers, they failed to do so. (Dkt. 228, 240, 266). Plaintiffs also failed to timely inform Availity that certain Emerus entities used Visualutions to transmit their data to Availity. (Dkt. 266). And Plaintiffs never responded to Availity's February 5 email request to confirm that they had received the data and that their expert “has been able to access the data.” (Dkt. 278, 300).

Plaintiffs also contend that Availity's fee request includes “multiple phone conference and correspondence exchanges with defense counsel ... [that] were completely unnecessary.” (Dkt. 326 at 5) (emphasis in original). To the contrary, the .75 hour of time on March 3 and 4 was necessitated by the Court's February 26 and 29 orders instructing the parties to confer with Availity in an effort to resolve the “unusable” data issue prior to the March 4 status hearing. (Dkt. 299, 301). And, it was incumbent on Availity to insure that they were in full compliance with the Subpoena, which had been issued by Defendants.

Plaintiffs further argue that Availity's fee request is excessive because it billed three hours to draft and revise the fee petition. (Dkt. 326 at 5–6). The Court finds otherwise. Given the long and tortured history of the Subpoena, counsel needed to review at least five court orders and hearing transcripts, seven letter status reports, and his billing records along with those of his client. And the petition included declarations by both inside and outside counsel. Under these circumstances, the Court finds that three hours is reasonable. However, the Court agrees with Plaintiffs that the 12 hours spent by Availity's internal IT staff and in-house counsel should be excluded from the fee award. (Dkt. 326 at 7). This time, unsupported by billing records, is largely duplicative of the hours spent by outside counsel addressing the same issues. The Court finds that Availity is reasonably compensated by reimbursing the time that outside counsel spent on this matter after Availity had fully complied with the subpoena on February 5, 2016.

*4 Finally, Plaintiffs contend that the time spent by Availity and its counsel in addressing the 835 data issue should be offset by the time spent by Plaintiffs in addressing the inadvertent claims data production error committed by Availity. (Dkt. 326 at 7–8). The Court declines to engage in a quid pro quo analysis regarding this issue. First, the federal rules place an enhanced duty on protecting a nonparty—who is providing involuntary assistance to the parties—from undue burden and expense. Fed. R. Civ. P. 45(d)(1), advisory committee notes (1991) (“A non-party required to produce documents or materials is protected against significant expense resulting from involuntary assistance to the court.”). In any event, if the Court chose to evaluate conduct that occurred prior to February 5, 2016, it would need to take into account that Plaintiffs (1) failed to provide Availity with a list of Emerus ID numbers—contrary to Court order; (2) failed to timely inform Availity that certain Emerus entities used Visualutions to transmit their data to Availity, which complicated Availity's ability to provide the requested data; and (3) failed to timely examine the Availity production between January 14 and February 2, 2016, to confirm its completeness, despite assuring the Court on both January 22 and February 1 that the Availity production was complete.

For the reasons stated above, the Court recommends that Availity, LLC's Petition for Fees and Costs [316] be granted in part and that Plaintiffs be ordered to pay $5,337.50 in fees and costs to Availity. Counsel has 14 days from the date of service of this Court's Report and Recommendation to file objections with the Honorable Robert W. Gettleman. See Fed. R. Civ. P. 72(b); 28 U.S.C. § 636(b)(1). Failure to object constitutes a waiver of the right to appeal. Lorentzen v. Anderson Pest Control, 64 F.3d 327, 330 (7th Cir. 1995).