Motion to compel granted where producer fails to make any effort to reduce cost estimates

August 31, 2009 | Leave a Comment

Spieker v. Quest Cherokee, LLC, 2009 U.S. Dist. LEXIS 62073 (D. Kan. Jul. 21, 2009)

Requestors’ initial document request for ESI had been originally denied without prejudice because the estimated cost had ranged form $82,000 to $375,000; requestor had not explained the relevance of the ESI to the issue of class certification; producer was in the process of upgrading its computer system; and new evidence Rule 502 had been enacted to reduce the cost of privilege review, estimated at $250,000.

On a renewed motion, requestors demonstrated relevance to the court’s satisfaction. In connection with the cost issue, the court had directed the parties to consider the possibility of cost reduction using newly installed software and producer’s in-house staff, and to determine how Rule 502 could be utilized to reduce the cost of privilege review. Producer’s vendor Kroll Ontrack had estimated that e-mail processing would cost $82,500, while $38,000 would be required to copy the ESI into TIFF format, assuming that about 1/3 of the data would be produced while the remaining 2/3 would be non-responsive or privileged.

Producer argued that its staff had no experience producing ESI, and that production would have to occur on nights or weekends; thus the cost would be higher than using an outside vendor. The court found the arguments unpersuasive. The court was not aware of any case in which production was excused because of inexperience of producer’s technical staff. Furthermore, producer’s IT manager had conducted limited searches and stated that the searches would be possible if e-mail were archived or converted.

Requestor’s argument that producer could minimize costs by turning over all ESI with a clawback agreement was also unpersuasive, given that Rule 502(b) preserved privilege only if the holder took reasonable steps to prevent disclosure of privileged material. “Simply turning over all ESI materials does not show that a party has taken ‘the reasonable steps’ to prevent disclosure of its privileged materials and plaintiffs’ proposal is flawed.” Id. at *10.

On the other hand, producer’s $250,000 privilege review estimate was excessive. The court observed that producer had failed to present any modification of the initial estimate.

Clearly, there are multiple approaches to electronic discovery and alternatives for reducing costs and it appears that defendant asserts the highest estimates possible merely to support its argument that electronic discovery is unduly burdensome. Under the circumstances, the court concludes that defendant’s estimate of the cost to conduct a “privilege and relevance” review is greatly exaggerated.

Id. at *12.

Producer also argued that the requested discovery was not reasonably accessible because of undue burden or cost. However, as stated above, because of producer’s failure to examine any cost-saving alternatives, producer also failed to meet its burden of proving inaccessibility. After demonstrating that the requested discovery was not cumulative, and that other methods of discovery would not result in more efficient production of the requested material, requestor’s motion to compel was granted.

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