United States District Court, N.D. Ohio, Eastern Division
MEMORANDUM OPINION AND ORDER
C. NUGENT, UNITED STATES DISTRICT JUDGE.
matter comes before the Court upon GCR Tire &
Service's Motion for Assessment of Fees and Expenses.
(ECF #90). The motion results from a dispute over how much
non-party GCR should be reimbursed for fees the company
incurred as a result of complying with a subpoena served by
Horizon Tire, Inc. ("Horizon"). Horizon filed a
brief in opposition to GCR's Motion for Assessment of
Fees and Expenses. (ECF #92). GCR filed a reply in support of
its motion. (ECF #93). Having considered all of the
submissions, and having reviewed the applicable law, this
Court finds that GCR's Motion for Assessment of Fees and
Expenses should be GRANTED. GCR is awarded an amount of $39,
case stems from a situation regarding a discovery dispute
over the amount of costs . and fees owed to non-party GCR for
compliance with a subpoena. On February 16, 2016, Horizon
issued a subpoena to GCR for information relevant to Linglong
and Flagship, parties litigating in opposition to Horizon.
(ECF #92-2). The subpoena sought documents in GCR's
possession or custody or documents in the control or
possession of GCR's corporate affiliates. (ECF # 92-2).
GCR retained the law firm Hanna, Campbell & Powell, LLP
to investigate and respond to the subpoena. (ECF #90-1 at p.
initially served with the subpoena, GCR believed
Horizon's document requests to be to be overbroad and
burdensome because of the broad range of documents Horizon
requested. (ECF #90-1 at p. 2). GCR communicated to Horizon
the company did not have the proper tools to efficiently
identify, review, or produce such broad range of documents.
(Id.) GCR stated that in order to fully comply with
the request, GCR would have to conduct interviews with GCR
employees across the country to determine which custodians
may have information relevant to Horizon's the subpoena.
(Id.) GCR estimated that without narrowing the scope
of the subpoena, the cost of compliance would be over $150,
order to make compliance with the subpoena manageable and
less costly, GCR attorneys contacted a Horizon attorney
shortly after service of the subpoena seeking to narrow the
scope of requested documents. (Id.) In August 2016,
after several months of discussions between attorneys from
GCR and Horizon, Horizon provided GCR with a list of seven
GCR custodians with records to be searched. (Id. at
3). Search terms initially provided by Horizon resulted in 7,
000 hits for potential documents for these seven custodians.
After continued discussions between GCR and Horizon, new
search terms were formulated resulting in a collection of 1,
316 potentially relevant documents. (Id. at 4).
After working extensively to narrow the scope of the search,
GCR worked to review documents for relevant information and
to ensure there was no privileged or confidential information
in the documents. (ECF 90-1, p.4).
October 2016, Horizon served GCR with another subpoena in a
related lawsuit filed in Texas state court. The second
subpoena was similar to Horizon's subpoena to GCR in this
case and Horizon told that GCR that it could produce the same
documents in response to both subpoenas. (ECF #92, p.3).
Consequently, the second subpoena was characterized as
placing no additional burden on GCR.
February 2017, GCR attempted to be reimbursed for costs
related to its work complying with the subpoena and sent
Horizon a bill for costs incurred from the time of service of
the subpoena in February 2016 up to that point. (ECF #92 at
p. 4). The bill included $6, 555 for data processing as well
as about $20, 000 for document review and other work related
to narrowing the scope of the subpoena. (Id.)
Horizon disputed the amount and stated it would consider
paying GCR's IT-related expense, but not legal expenses
incurred as a result from the subpoena. GCR then notified
this Court of a discovery dispute and sought assurance of
reimbursement before further production of documents. (ECF
result of the fee dispute, this Court held a status
conference with the parties on May 12, 2017. At the status
conference, this Court ordered GCR to comply with the
subpoena and ruled that GCR is entitled to "reasonable
fees and expenses" incurred as a result of compliance
with the subpoena. (ECF #81). This Court also stated that if
GCR and Horizon could not agree on an amount "GCR may
submit a final bill to the Court for resolution."
the judgment from this Court, GCR continued to review over 1,
300 documents and ultimately produced about 870 pages of
documents. (ECF #90-1 at p. 4). GCR now seeks to have a total
of $39, 905 in costs and attorney's fees
reimbursed as a result of complying with Horizon's
subpoena. (ECF #92 at p. 9). Horizon claims that GCR's
claimed expenses are not reasonable because the costs are
exaggerated, poorly documented, or incurred as a result of
its own efforts to resist complying with the subpoena.
(Id.) Further, Horizon asserts that GCR is entitled
to none of the attorney's fees incurred while litigating
the fee dispute. (Id.) Horizon does not dispute the
reasonableness of GCR's attorneys' hourly rates and
does not believe the rates were unusually high. (Id.
at 6). Horizon only argues the amount GCR seeks is not
reasonable because the work pace was slow, unnecessary, or
incurred from types fees not reimbursable under Rule 45.
Horizon suggests a total amount of $9, 993 to be reimbursed
to GCR for its work responding to Horizon's subpoena.
(Id. at 15). Horizon also argues that only half of
this total should be reimbursed through this Court and the
other half should be reimbursed through the case pending in
Texas state court. (Id. at 11).
Rule of Civil Procedure 45 provides that when a court orders
compliance with a subpoena over an objection, “the
order must protect a person who is neither a party nor a
party's officer from significant expense resulting from
compliance." Fed.R.Civ.P. 45(d)(2)(B)(ii). This
provision has been deemed to "make cost shifting
mandatory in all instances which a non-party incurs
significant expense from compliance with a subpoena."
Legal Voice v. Stormans, Inc., 738 F.3d 1178, 1184
(9th Cir. 2013); Linder v. Calero-Portocarrero, 251
F.3d 178 (D.C. Cir. 2001). Consequently, if a subpoena
imposes expenses on a non-party and those expenses are deemed
"significant, " a district court is required to
"protect the non-party by requiring the party seeking
discovery to bear at least enough of the expense to render
the remainder non-significant." Linder, 251
F.3d at 182. The determination of what costs are significant
is within the sound discretion of the trial court. Sound
Sec, Inc. v. Sonitrol Corp., No. 3:08-cv-05359-RBL, 2009
WL 1835653, at *1 (W.D. Wash. June 6, 2009). Expenses
incurred complying with a subpoena must also be reasonable,
and the determination of reasonableness is also within the
trial court's discretion. In re Aggrenox Antitrust
Litigation, No. 3:14-md-02516 (SRU), 2017 WL 4679228, at
*2 (D. Conn. Oct 18, 2017). Rule 45 (d)(1) also provides that
a party serving a subpoena "must take reasonable steps
to avoid imposing undue burden or expense on a person subject
to the subpoena. The court for the district where compliance
is required 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." F.R.C.P 45 (d)(1). This provision therefore
permits district courts to award a party with reasonable
attorney's fees incurred litigating a fee dispute related
to a subpoena. In re Aggrenox Antitrust Litigation,
2017 WL 4679228. at *3.
addressing the question of what constitutes reasonable
attorney's fees, courts use the Lodestar method. The
Lodestar method identifies reasonable attorney's fees by
multiplying “the number of hours reasonably expended on
the litigation by a reasonable hourly rate." Hensley
v. Eckerhart, 461 U.S. 424, 433 (1983); Northeast
Ohio Coalition for the Homeless v. Husted, 831 F.3d 686,
702 (6th Cir. 2016). The reasonable hourly rate is the amount
that "a paying client would be willing to pay."
Arbor Hill Concerned Citizens Neighborhood Ass'n v.
Cnty. of Albany, 522 F.3d 182, 190 (2d Cir. 2008).
Reasonableness of legal fee expenses is therefore
demonstrated if the incurred fees have already been paid by
the client, since this indicates the market value of legal
services. Balcor Real Estate Holdings, Inc. v.
Walentas-Phoenix Corp., 72 F.3d 150, 153 (7th Cir.
Costs of Compliance with ...