The Country Vintner of NC v. E. & J. Gallo Winery , 718 F.3d 249 ( 2013 )

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
THE COUNTRY VINTNER OF NORTH 
CAROLINA, LLC,
Plaintiff-Appellee,
v.  No. 12-2074
E. & J. GALLO WINERY, INC.,
Defendant-Appellant.

Appeal from the United States District Court
for the Eastern District of North Carolina, at Raleigh.
W. Earl Britt, Senior District Judge.
(5:09-cv-00326-BR)
Argued: March 19, 2013
Decided: April 29, 2013
Before SHEDD, DAVIS, and KEENAN, Circuit Judges.
Affirmed by published opinion. Judge Davis wrote the opin-
ion, in which Judge Shedd and Judge Keenan joined.
COUNSEL
ARGUED: Garrick Alcarez Sevilla, Jonathan Ryan Bum-
garner, WILLIAMS MULLEN, Raleigh, North Carolina, for
Appellant. Stephen Donegan Busch, MCGUIREWOODS,
LLP, Richmond, Virginia, for Appellee. ON BRIEF: M.
2 COUNTRY VINTNER v. E. & J. GALLO WINERY
Keith Kapp, Christopher G. Browning, Jr., WILLIAMS
MULLEN, Raleigh, North Carolina, for Appellant. Lisa M.
Sharp, MCGUIREWOODS, LLP, Richmond, Virginia; Justin
D. Howard, MCGUIREWOODS, LLP, Raleigh, North Caro-
lina, for Appellee.
OPINION
DAVIS, Circuit Judge:
In this case we clarify what expenses related to electroni-
cally stored information ("ESI") are taxable under the federal
taxation-of-costs statute as "[f]ees for exemplification and the
costs of making copies of any materials where the copies are
necessarily obtained for use in the case." 28 U.S.C. § 1920(4).
The district court entered an order taxing only the costs of
converting electronic files to non-editable formats, and trans-
ferring files onto CDs. Country Vintner of N.C., LLC v. E. &
J. Gallo Winery, Inc., No. 5:09-cv-326-BR, 2012 WL
3202677, at *3 (E.D.N.C. Aug. 3, 2012). Asserting the district
court erred or otherwise abused its discretion, Appellant E. &
J. Gallo Winery, the prevailing party in this case, noted its
timely appeal from the district court’s order. For the following
reasons, we affirm.
I.
In January 2005, the winery Bodegas Esmeralda selected
Appellee The Country Vintner of North Carolina, LLC
("Country Vintner"), as the exclusive North Carolina whole-
saler of Alamos, an Argentinian wine. In January 2009, E. &
J. Gallo Winery ("Gallo") began supplying the wine to a net-
work of wholesalers in the state, excluding Country Vintner.
Country Vintner sued Gallo, alleging violations of the North
Carolina Wine Distribution Agreements Act (the "Wine Act")
and the North Carolina Unfair and Deceptive Trade Practices
Act.
COUNTRY VINTNER v. E. & J. GALLO WINERY 3
Almost immediately, the parties clashed over the discovery
of ESI. Among other things, Country Vintner sought emails
and other writings that "refer[red] to or relate[d] to the estab-
lishment of the business relationship between Gallo and
Bodegas Esmeralda," Gallo’s relationship with wine distribu-
tors, and Gallo’s "appointment . . . . to import Alamos." J.A.
65–66, 69. During a phone conference to draft a discovery
plan, Gallo complained that "retrieval of all potentially rele-
vant electronically stored information . . . [was] not reason-
ably accessible because of the undue burden and expense it
would impose." Id. at 58, 673–74. Gallo asserted that it
"would have to interview each of . . . more than forty . . .
employees," search "at least seven or eight servers in various
locations," and "review every single document wherein it
communicated with anyone . . . concerning the Alamos
brand." Id. at 586–87. Country Vintner "agreed to consider
any proposal [to] . . . narrow[ ] the field of potential employ-
ees . . . and . . . develop key words, search terms, and/or date
restrictions in order to search specific repositories of electron-
ically stored information," but otherwise refused to limit its
discovery requests. Id. at 674–75.
Gallo moved for a protective order, arguing that Country
Vintner’s discovery requests were "overbroad, vague," "am-
biguous," and "not reasonably calculated to lead to the discov-
ery of admissible evidence." J.A. 746–47. Gallo asserted that
it would cost $30,000 to process the email data of 24 employ-
ees, and up to $432,000 to review the data "to guard against
privilege waiver." Id. at 748. Gallo further asserted that Coun-
try Vintner "ha[d] refused to offer any meaningful assistance"
in "narrowing the field of potential employees" or "assisting
Gallo to develop key words, search terms, and/or date restric-
tions." Id. at 748–49.
Country Vintner opposed the motion and moved to compel
Gallo to provide more complete responses to its interrogato-
ries and requests for documents and admission. J.A. 832–43.
Country Vintner accused Gallo of a "strategic decision to
4 COUNTRY VINTNER v. E. & J. GALLO WINERY
avoid responding to discovery," and asserted that Country
Vintner "ha[d] suffered prejudice because it continue[d] to
lack information . . . to adequately prosecute its case . . . ."
Id. at 842.
The district court denied Gallo’s motion for a protective
order and adopted Country Vintner’s proposal for handling
ESI: the court ordered Gallo to "run searches on archived e-
mail and documents created [in a one-year period] by an ini-
tial set of eight identified custodians," using 16 search terms
proposed by Country Vintner and "any other terms suggested
by [Gallo] [that] might produce relevant documents." J.A.
887–88. The court further ordered that, after Gallo "deter-
mine[d] the volume of materials produced by these searches,"
the parties "meet and confer to agree upon a sequence for dis-
closure of the electronically stored information on a rolling
production." Id. at 887. The court also granted Country Vint-
ner’s motion to compel, "to the extent that [Gallo] ha[d] addi-
tional relevant and responsive information that it ha[d] not yet
provided to [Country Vintner]." Id. at 894.
In response to the court’s order, Gallo "collected more than
62 GB of data" and forwarded it to its lawyers’ firm for "pro-
cessing and review." J.A. 930. The firm "process[ed] the data
into a searchable format, remove[d] system files and exact
duplicates, and then [ran] three variations of the phrases and
search terms set forth in the [district court’s] order." Id. Coun-
try Vintner proposed applying 19 search terms to the 62 GB
of data, and noted a preference for "receiving [the] ESI in a
format compatible with Summation." Id. at 961–62.1 Gallo
had used different litigation support software, IPRO eCapture
and kCura Relativity, to process the data. Id. at 930.
1
Summation is a "review platform," i.e., software "used to store, dis-
play, sort, search, tag, code, annotate, redact and/or produce ESI." Craig
D. Ball, American Law Institute–American Bar Association Course of
Study, E-Discovery: Right . . . From the Start, at 275 n.3 (July 23-25,
2009).
COUNTRY VINTNER v. E. & J. GALLO WINERY 5
Less than two months after Gallo began producing docu-
ments, the district court granted Gallo’s motion to dismiss
Country Vintner’s claim under the North Carolina Unfair and
Deceptive Trade Practices Act. The parties then filed cross-
motions for summary judgment on the remaining Wine Act
claims, and the court granted summary judgment in favor of
Gallo. Upon Country Vinter’s appeal of the order granting
summary judgment in favor of Gallo, we affirmed. Country
Vintner of N.C., LLC v. E & J Gallo Winery, Inc., 461 F.
App’x 302, 308 (4th Cir. 2012).
Gallo thereafter filed in the district court a bill of costs,
seeking to recover $111,047.75 from Country Vintner for
charges related to ESI. Gallo sought costs in the following six
categories:
First, $71,910 for "flattening" and "indexing" ESI. J.A.
1229–30. This "initial processing" of data involved decom-
pressing container files2 (e.g., ZIP files or Microsoft PST
files); making the data searchable by extracting text and creat-
ing Optical Character Recognition3 for text that could not be
extracted; indexing the data; removing system files that were
known not to contain any user-generated content; and remov-
ing duplicate files. Id. 1224.
Second, $15,660 for "Searching/Review Set/Data Extrac-
tion." J.A. 1229–30. This process involved extracting metadata4
2
A container file is "[a] single file containing multiple documents and/or
files." Sedona Conference, The Sedona Conference Glossary: E-Discovery
& Digital Information Management 10 (3d ed. Sept. 2010) [hereinafter
"Sedona Glossary"].
3
Optical Character Recognition ("OCR") is "[a] technology process that
translates and converts printed matter on an image into a format that a
computer can manipulate . . . and, therefore, renders that matter text
searchable." Sedona Glossary 37.
4
Metadata is simply "data that provides information about other data."
Merriam-Webster Dictionary, available at http://www.merriam-
webster.com/dictionary/metadata (last visited April 9, 2013).
6 COUNTRY VINTNER v. E. & J. GALLO WINERY
from the documents; "unitiz[ing]" electronic documents by
"locat[ing] logical document breaks for purposes of review-
ing, searching, and production"; creating an index of metadata
for every electronic document; and exporting and loading the
electronic documents and metadata onto a "review/production
platform." Id. at 1225.
Third, $178.59 for "TIFF Production" and "PDF Produc-
tion." J.A. 1229–31. This process involved converting original
or "native" documents to a .tif5 or .pdf format6 to render them
non-editable. Id. at 1225.
Fourth, $74.16 for electronic "Bates Numbering." J.A.
1230. In this "higher-tech version" of Bates stamping, the
TIFF or PDF documents were "endorsed . . . with a unique
"Metadata may be totally innocuous, such as formatting instruc-
tions and margin determinations, but sometimes metadata pro-
vides crucial evidence that is not available in a paper document."
"Metadata may reveal who worked on a document, the name of
the organization that created or worked on it, information about
prior versions of the document, recent revisions, and comments
inserted in the document during drafting or editing . . . . The hid-
den text may reflect editorial comments, strategy considerations,
legal issues raised by the client or the lawyer, or legal advice pro-
vided by the lawyer." Metadata may provide information that a
paper document would not provide or information that differs
from a paper document. Metadata may also reveal that a docu-
ment has been changed or backdated.
Jennifer M. Smith, Electronic Discovery and the Constitution: Inaccessi-
ble Justice, 6 J. Legal Tech. Risk Mgmt. 122, 138-39 (2012) (ellipsis in
original) (footnotes omitted).
5
The .tif extension connotes a TIFF file, "[a] widely used and supported
graphic file format[ ] for storing . . . images." Sedona Glossary 50. TIFF
stands for Tagged Image File Format. Id.6
PDF, short for Portable Document Format, is "[a] file format technol-
ogy developed by Adobe Systems to facilitate the exchange of documents
between platforms regardless of originating application by preserving the
format and content." Sedona Glossary 39.
COUNTRY VINTNER v. E. & J. GALLO WINERY 7
number that allow[ed] all parties to track the document[s]."
Id. at 1226.
Fifth, $40 for copying images onto a CD or DVD. J.A.
1226, 1230.
Sixth, $23,185 for "management of the processing of the
electronic data," "quality assurance procedures," "analyzing
corrupt documents and other errors," and "preparing the pro-
duction of documents to opposing counsel." J.A. 1227,
1232–37.
The parties having vigorously contested the propriety of the
bill of costs filed with the clerk, and having filed numerous
legal memoranda, the clerk of the district court deferred the
matter of costs to the presiding district judge.
The district court granted in part and denied in part the bill
of costs. Adopting the reasoning of the Third Circuit, the
court concluded that, under 28 U.S.C. § 1920(4), "a prevailing
party may recover costs associated with copying or duplicat-
ing its files, but it may not receive reimbursement for any
other ESI-related expenses." Country Vintner of N.C., LLC,
2012 WL 3202677, at *2 (citing Race Tires Am., Inc. v. Hoo-
sier Racing Tire Corp., 674 F.3d 158 (3d Cir. 2012)). The
court found that, in this case, "the only tasks that involve[d]
copying [we]re the conversion of native files to TIFF and
PDF formats and the transfer of files onto CDs." Id. at *3. The
court concluded that Gallo was entitled to recover $218.59 in
ESI-related costs:
1. 19 March 2010, TIFF production: $ 8.46
2. 19 March 2010, CD Copy: $ 10.00
3. 2 April 2010, TIFF Production: $ 4.20
4. 16 April 2010, PDF Production: $ 6.84
8 COUNTRY VINTNER v. E. & J. GALLO WINERY
5. 19 April 2010, CD Copy: $ 10.00
6. 19 April 2010, TIFF Production: $ 21.96
7. 22 June 2010, CD Copy: $ 10.00
8. 23 June 2010, TIFF Production: $134.10
9. 25 June 2010, TIFF Production: $ 3.00
10. 1 July 2010, CD Copy: $ 10.00
11. 1 July 2010, TIFF Production: $ .03
TOTAL: $218.59
Id.
The court noted that "it [was] possible that the bill of costs
. . . contain[ed] other ESI-related expenses that [were] tax-
able," but concluded that such costs were not "readily dis-
cern[able]" because "Gallo ha[d] included various multi-task
entries." Country Vintner of N.C., LLC, 2012 WL 3202677, at
*3 n.5. The district court also concluded that none of the "the
ESI-related costs in this case . . . qualif[ied] as fees for exem-
plification under any established construction of the term." Id.*2 n.4. Approving $350 for "[f]ees of the clerk," the court
awarded total costs of $568.59. Id. at *3.
We exercise jurisdiction pursuant to 28 U.S.C. § 1291.
II.
On appeal, Gallo argues that 28 U.S.C. § 1920(4) allows
recovery of its ESI processing charges and the district court
erred in excluding them from the award of costs. Country
Vintner counters that the district court properly denied these
COUNTRY VINTNER v. E. & J. GALLO WINERY 9
charges as outside the scope of § 1920(4). For the following
reasons, we affirm the district court’s order.
A.
"Under Rule 54(d)(1) of the Federal Rules of Civil Proce-
dure, costs ‘should be allowed to the prevailing party’ unless
a federal statute provides otherwise." Williams v. Metro. Life
Ins. Co., 609 F.3d 622, 636 (4th Cir. 2010) (quoting Fed. R.
Civ. P. 54(d)(1)). "Section 1920 enumerates expenses that a
federal court may tax as a cost under the discretionary author-
ity found in Rule 54(d)." Crawford Fitting Co. v. J.T. Gib-
bons, Inc., 482 U.S. 437, 441–42 (1987).
"Generally, we review the district court’s award of . . .
costs for abuse of discretion." Bosley v. Mineral Cnty.
Comm’n, 650 F.3d 408, 411 (4th Cir. 2011). "However, where
a district court’s decision is based on a premise and interpreta-
tion of the applicable rule of law, and the facts are estab-
lished, we review that decision de novo." Id. (internal
quotation marks omitted).
Because the parties dispute whether the district court prop-
erly interpreted § 1920(4), we apply de novo review. See Bos-
ley, 650 F.3d at 411. See also Synopsys, Inc. v. Ricoh Co. (In
re Ricoh Co. Patent Litig.), 661 F.3d 1361, 1364 (Fed. Cir.
2011) ("[W]hether a particular expense falls within the pur-
view of section 1920, and thus may be taxed in the first place,
is an issue of statutory construction, subject to de novo
review.").
B.
The taxation-of-costs statute, 28 U.S.C. § 1920, sets forth
"[t]he costs that may be awarded to prevailing parties in law-
suits brought in federal court." Taniguchi v. Kan P. Saipan,
Ltd., 132 S. Ct. 1997, 1999–2000 (2012). In deciding whether
subsection (4) permits the taxation of ESI processing charges,
10 COUNTRY VINTNER v. E. & J. GALLO WINERY
we follow the Supreme Court’s example and begin with a
brief overview of the statute. See id. at 2001–02.
"At common law, costs were not allowed," Alyeska Pipe-
line Serv. Co. v. Wilderness Soc’y, 421 U.S. 240, 247 (1975),
but "federal courts in the early years . . . award[ed] costs in
the same manner as the courts of the relevant forum State,"
Taniguchi, 132 S. Ct. at 2001. This resulted in "great diversity
in practice among the courts," with "losing litigants" often
"unfairly saddled with exorbitant fees for the victor’s attor-
neys." Alyeska Pipeline Serv. Co., 421 U.S. at 251.
In 1853, Congress enacted a predecessor to § 1920 "to stan-
dardize the costs allowable in federal litigation," Alyeska
Pipeline Serv. Co., 421 U.S. at 251, and "simplify the taxation
of fees, by prescribing a limited number of definite items to
be allowed," Cong. Globe, 32nd Cong., 2d Sess. App. 207
(1853) (statement of Sen. Bradbury). See also id. (noting the
lack of a "uniform rule . . . for the regulation of . . . costs,"
and the bill’s purpose to "prescribe the costs which shall be
taxed and recovered"). "The result was a far-reaching Act
specifying in detail the nature and amount of the taxable items
of cost in the federal courts." Alyeska Pipeline Serv. Co., 421
U.S. at 251–52. The 1853 act provided that
[t]he bill of fees of clerk, marshal, and attorneys, and
the amount paid printers, and witnesses, and lawful
fees for exemplifications and copies of papers neces-
sarily obtained for use on trial in cases where by law
costs are recoverable in favor of the prevailing party,
shall be taxed by a judge or clerk of the court, and
be included in and form a portion of a judgment or
decree against the losing party.
Act of Feb. 26, 1853, 10 Stat. 161, 168 (emphasis added). The
statute’s "comprehensive scope" and "the particularity with
which it was drafted demonstrated . . . that Congress meant
COUNTRY VINTNER v. E. & J. GALLO WINERY 11
to impose rigid controls on cost-shifting in federal courts."
Crawford Fitting Co., 482 U.S. at 444.
"The 1853 Act was carried forward in the Revised Statutes
of 1874 and by the Judicial Code of 1911." Alyeska Pipeline
Serv. Co., 421 U.S. at 255. "Its substance, without any appar-
ent intent to change the controlling rules, was also included
in the Revised Code of 1948 as 28 U.S.C. §§ 1920 and
1923(a)." Id. at 255 (footnotes omitted).
The 1948 version of § 1920 provided that
[a] judge or clerk of any court of the United States
may tax as costs the following:
(1) Fees of the clerk and marshal;
(2) Fees of the court reporter for all or
any part of the stenographic transcript
necessarily obtained for use in the
case;
(3) Fees and disbursements for printing
and witnesses;
(4) Fees for exemplification and copies of
papers necessarily obtained for use in
the case;
(5) Docket fees under section 1923 of this
title.
62 Stat. 955 (1948) (emphasis added). In 1978, Congress
amended the statute to add a sixth category of taxable costs:
(6) Compensation of court appointed
experts, compensation of interpreters,
and salaries, fees, expenses, and costs
12 COUNTRY VINTNER v. E. & J. GALLO WINERY
of special interpretation services under
section 1828 of [title 28].
Pub. L. No. 95-539, 92 Stat. 2040, 2044 (1978).
The statute remained unchanged until 2008, when Congress
updated subsections (2) and (4) to allow the taxation of:
(1) [f]ees for printed or electronically recorded
transcripts necessarily obtained for use in the
case; [and]
***
(2) [f]ees for exemplification and the costs of mak-
ing copies of any materials where the copies
are necessarily obtained for use in the case[.]
Judicial Administration and Technical Amendments Act of
2008, Pub. L. No. 110–406, 122 Stat. 4291, 4292 (2008) (cod-
ified at 28 U.S.C. § 1920(2) & (4)) (emphasis added).
These amendments originated with the Judicial Conference
of the United States (the "Judicial Conference") and its Com-
mittee on Court Administration and Case Management (the
"Committee"). Judicial Conference, Report of the Proceed-
ings of the Judicial Conference of the United States 9–10
(March 18, 2003) [hereinafter "Judicial Conference Report"];
28 U.S.C. § 1920(2) & (4). Sometime before December 2002,
a former magistrate judge had asked the Committee to con-
sider "proposing amendments to 28 U.S.C. § 1920 that would
allow expenses associated with new courtroom technologies
to be included in the taxing of litigation costs." Committee on
Court Administration and Case Management, Report of the
Judicial Conference, Committee on Court Administration 3
(March 2003) [hereinafter "Committee Report"].
In December 2002,
COUNTRY VINTNER v. E. & J. GALLO WINERY 13
the Committee considered whether technological
advances that ha[d] occurred over the past twenty-
five years ma[d]e it appropriate to reevaluate the cost
provisions in 28 U.S.C. § 1920, so that recovery for
costs associated with many litigation tools com-
monly used [in 2002], including videotaped deposi-
tions or electronically presented evidence, might be
permitted.
Committee Report 3–4. While the Committee "agreed that
§ 1920 [did] not address many of the technology expenses
that [we]re . . . often expended in federal litigation," it "was
concerned . . . that the charges for these new expenses could
dramatically expand the intention of the statute, which was to
allow the taxing of costs in a very limited way." Id. at 4.
Therefore, the Committee decided to recommend
that the Judicial Conference endorse two limited
statutory amendments to 28 U.S.C. § 1920. The first
would amend subsection (2) to recognize the avail-
ability of transcripts in electronic form. The second
would expand the concept of "papers" in subsection
(4) in order to reflect the decreasing use of paper and
the increasing use of technology in creating, filing,
and exchanging court documents. The Committee
rejected the concept of an amendment to permit the
taxing of costs associated with the use of technology
to create, assist, enhance or present materials during
a trial.
Id. In March 2003, the Judicial Conference adopted the Com-
mittee’s recommendation. Judicial Conference Report 10.
Congress enacted the proposed amendments verbatim, as
part of the Judicial Administration and Technical Amend-
ments Act of 2008. Judicial Conference Report 10; 28 U.S.C.
§ 1920(2) & (4). Senator Leahy, a co-sponsor of the bill,
explained that the legislation aimed to "facilitate and update
14 COUNTRY VINTNER v. E. & J. GALLO WINERY
judicial operations," "improve judicial resource management
and strengthen the constitutional protection of Americans’
right to serve on juries," and "clarify existing [criminal] law
to better fulfill Congress’s original intent." 154 Cong. Rec.
S9898 (Sept. 27, 2008) (statement of Sen. Leahy). In the
House, Rep. Lofgren described the bill as a collection of
"noncontroversial measures proposed by the Judicial Confer-
ence to improve efficiency in the Federal courts." 152 Cong.
Rec. H10271 (Sept. 27, 2008) (statement of Rep. Lofgren).7
She also noted that the legislation would "mak[e] electroni-
cally produced information coverable in court costs." Id.III.
On appeal, Gallo seeks the $111,047.75 in ESI-related
charges it initially sought, less (1) $218.59 the district court
awarded, (2) $74.16 in charges for Bates numbering, and (3)
$8,897 in "charges for any billable time" related to "Bates
numbering, searching, or production-related activities." Open-
ing Br. 22 & n.7. Gallo argues that the remaining $101,858
in "ESI processing charges" is taxable under 28 U.S.C.
§ 1920(4) as both "costs of making copies of any materials
where the copies are necessarily obtained for use in the case,"
and "[f]ees for exemplification . . . of any materials." Id. at 18,
20. We are not persuaded by Gallo’s arguments, but neither
do we embrace wholesale Country Vintner’s crabbed interpre-
tation of the amended costs statute.
A.
As a preliminary matter, we reject Country Vintner’s con-
tention that § 1920(4) applies only to the costs related to
7
See also 152 Cong. Rec. H10272 (Sept. 27, 2008) ("[T]he purpose of
[the bill] is to implement noncontroversial administrative provisions that
the Judicial Conference and the House Judiciary Committee believe are
necessary to improve the operations of the Federal judiciary.") (statement
of Rep. Smith).
COUNTRY VINTNER v. E. & J. GALLO WINERY 15
materials attached to dispositive motions or produced at trial.
To the extent that Country Vintner has not waived this chal-
lenge,8 the argument fails on the merits. Although the original
costs statute limited taxation to "lawful fees for exemplifica-
tions and copies of papers necessarily obtained for use on
trial," 10 Stat. 161, 168 (emphasis added), the current statute
more broadly permits taxation of "[f]ees for exemplification
and the costs of making copies . . . necessarily obtained for
use in the case," 28 U.S.C. § 1920(4) (emphasis added).
Moreover, several circuits have found that § 1920(4) encom-
passes discovery-related costs.9 Thus, the plain language and
8
"The general rule is that without taking a cross-appeal, the prevailing
party may present any argument that supports the judgment in its favor as
long as the acceptance of the argument would not lead to a reversal or
modification of the judgment . . . . " JH ex rel. JD v. Henrico Cnty. Sch.
Bd., 326 F.3d 560, 567 n.5 (4th Cir. 2003) (internal quotation marks and
alteration omitted); cf. Genesis Healthcare Corp. v. Symczyk, ___ S.Ct.
___, No. 11–1059, 2013 WL 1567370, at *5 (U.S. Apr. 16, 2013) (noting
analogous rule regarding cross-petitions for certiorari in the Supreme
Court). Country Vintner argues that discovery-related costs are not taxable
under § 1920, but the district court awarded $218.59 for Gallo’s
discovery-related costs of converting files to non-editable formats, and
burning documents onto CDs. Thus, "acceptance of [Country Vintner’s]
argument would . . . lead to a . . . modification of the judgment"—i.e., a
reduction of $218.59 in the costs awarded by the district court. JH ex rel.
JD, 326 F.3d at 567 n.5.
9
See In re Ricoh Co., Ltd. Patent Litig., 661 F.3d at 1365 (applying
Ninth Circuit law) ("Under section 1920(4), exemplification and copying
costs for producing documents in discovery are recoverable."); Rundus v.
City of Dallas, Tex., 634 F.3d 309, 316 (5th Cir. 2011) ("[C]osts incurred
merely for discovery . . . . are recoverable if the party making the copies
has a reasonable belief that the documents will be used during trial or for
trial preparation.") (internal quotation marks omitted); U.S. E.E.O.C. v. W
& O, Inc., 213 F.3d 600, 623 (11th Cir. 2000) ("Copies attributable to dis-
covery are a category of copies recoverable under § 1920(4).") (internal
quotation marks omitted); Illinois v. Sangamo Constr. Co., 657 F.2d 855,
867 (7th Cir. 1981) (affirming taxation of costs of copying, inter alia, dis-
covery documents because the "expense of copying materials reasonably
necessary for use in the case are recoverable costs under 28 U.S.C.
§ 1920(4)," and "[t]he underlying documents need not be introduced at
16 COUNTRY VINTNER v. E. & J. GALLO WINERY
weight of authority establish that the costs of exemplifications
and copies in discovery are taxable under § 1920(4).
B.
Turning to the merits of Gallo’s appeal, we must first deter-
mine whether Gallo’s ESI processing charges constitute
"costs of making copies . . . necessarily obtained for use in the
case." 28 U.S.C. § 1920(4). We think not.
1.
"As with any issue of statutory interpretation, we focus on
the plain language of the statute, seeking first and foremost to
implement congressional intent." WEC Carolina Energy Solu-
tions LLC v. Miller, 687 F.3d 199, 203 (4th Cir. 2012) (inter-
nal quotation marks and ellipsis omitted). "To determine a
statute’s plain meaning, we not only look to the language
itself, but also the specific context in which that language is
used, and the broader context of the statute as a whole." In re
Total Realty Mgmt., LLC, 706 F.3d 245, 251 (4th Cir. 2013)
(internal quotation marks omitted).
Here, the relevant statutory language is "making copies."
28 U.S.C. § 1920(4). Because the term is not defined in the
statute, we must apply "its ordinary meaning." Taniguchi, 132
S. Ct. at 2002.
"Copies" has appeared in the taxation statute since its
trial in order for the cost of copying them to be recoverable"). That some
courts deny discovery costs as a matter of discretion does not mean that
such costs are not recoverable under § 1920(4) as a matter of law. See Lit-
tle Rock Cardiology Clinic PA v. Baptist Health, 591 F.3d 591, 601–02
(8th Cir. 2009) (affirming district court’s refusal to tax certain discovery
costs as a matter of discretion, without reaching the question of whether
such costs are taxable as a matter of law).
COUNTRY VINTNER v. E. & J. GALLO WINERY 17
enactment in 1853, when "copy" meant a "transcript,"10 a
"writing like another writing,"11 or an "imitation."12 Today,
"copy" still refers to "an imitation, transcript, or reproduction
of an original work."13 To "make" means "to cause to happen,"14
"to bring into being by forming, shaping, or altering material,"15
to "produce (a material thing)"16 or to "construct" or "assem-
ble."17 Thus, "making copies" means producing imitations or
reproductions of original works.
Although the ordinary meaning of the phrase is expansive,
its application is limited by the "broader context of [§ 1920]
as a whole." In re Total Realty Mgmt., LLC, 706 F.3d at 251.
The Supreme Court has observed that taxable costs under the
statute are "modest in scope" and "limited to relatively minor,
incidental expenses." Taniguchi, 132 S. Ct. at 2006:
10
Benjamin Vaughan Abbott, Dictionary of Terms and Phrases Used in
American or English Jurisprudence 287 (1879); John Walker, A Critical
Pronouncing Dictionary 84 (1858); Samuel Johnson, A Dictionary of the
English Language 151 (1853); Noah Webster, An American Dictionary of
the English Language 192 (1830); George Crabb, A Dictionary of General
Knowledge 110 (1830).
11
Noah Webster, An American Dictionary of the English Language 192
(1830).
12
Noah Webster, A Dictionary of the English Language, Abridged from
the American Dictionary 91 (1850).
13
Merriam-Webster Dictionary online, http://www.merriam-
webster.com/dictionary/copy (last visited April 9, 2013). See also Oxford
English Dictionary online, http://www.oed.com (enter "copy" in the
"quick search" box and click on the first result) (defining "copy" as "[a]
transcript or reproduction of an original") (last visited April 9, 2013).
14
Merriam-Webster Dictionary online, http://www.merriam-
webster.com/dictionary/make (last visited April 9, 2013).
15
Id.16
Oxford English Dictionary online, http://www.oed.com (enter "make"
in the "quick search" box and click on the fourth result) (last visited April
9, 2013).
17
Id.18 COUNTRY VINTNER v. E. & J. GALLO WINERY
[Section] 1920 . . . lists such items as clerk fees,
court reporter fees, expenses for printing and wit-
nesses, expenses for exemplification and copies,
docket fees, and compensation of court-appointed
experts. Indeed, the assessment of costs most often
is merely a clerical matter that can be done by the
court clerk. Taxable costs are a fraction of the non-
taxable expenses borne by litigants for attorneys,
experts, consultants, and investigators. It comes as
little surprise, therefore, that costs almost always
amount to less than the successful litigant’s total
expenses in connection with a lawsuit.
Id. (internal quotation marks and citations omitted).18
Gallo argues that its ESI-processing charges are taxable as
fees for "making copies" under § 1920(4) because ESI has
"unique features": ESI is "more easily and thoroughly change-
able than paper documents," it contains metadata, and it often
has searchable text. Opening Br. 23, 26–27. Gallo contends
that converting native files to PDF and TIFF formats "pro-
duce[d] static, two-dimensional images that, by themselves,
[we]re incomplete copies of dynamic, multi-dimensional
ESI"; other "processing . . . was necessary to copy all integral
features of the ESI." Id. at 28 (emphasis in original). Gallo
argues that it had to remove ESI from container files, extract
and index text to make it searchable, copy metadata, and load
the data onto a "review platform" to allow "the native files
and their associated metadata [to] be viewed and their text [to]
be searched as if the native files were being opened in the
software applications that created them." Id. at 28–29. Gallo
concedes that this process was far more involved than that
necessary to copy paper documents but argues that
18
In Taniguchi, the Court held that "compensation of interpret-
ers"—added by the Court Interpreters Act as a taxable cost under
§ 1920(6)—"is limited to the cost of oral translation and does not include
the cost of document translation." Taniguchi, 132 S. Ct. at 2000.
COUNTRY VINTNER v. E. & J. GALLO WINERY 19
just as copying a table or dress requires a different
approach than copying a paper document, copying
ESI also requires a different approach.
Id. at 26.
Country Vintner counters that Gallo "distorts the plain
meaning of the statute" and "misconstrue[s] the act of pro-
cessing," which was "not required in order to produce copies
to Country Vintner, only to assist Gallo with its review."
Resp. Br. 17, 22 (emphasis in original). Country Vintner dis-
putes that Gallo "had no choice but to process the ESI . . . in
order to comply with its discovery obligations," because
"Country Vintner never demanded that Gallo produce pro-
cessed ESI replete with metadata and searchable text." Id. at
20. Country Vintner thus asks us to affirm the district court’s
adoption of the Third Circuit’s approach in Race Tires Amer-
ica, Inc. v. Hoosier Racing Tire Corp.
In Race Tires America, Inc., the Third Circuit held that, "of
the numerous services [that] [electronic discovery] vendors
[had] performed" in that case, "only the scanning of hard copy
documents, the conversion of native files to TIFF, and the
transfer of VHS tapes to DVD involved ‘copying’" within the
meaning of § 1920(4). Race Tires Am. Inc., 674 F.3d at 171.
The court reasoned that
[s]ection 1920(4) does not state that all steps that
lead up to the production of copies of materials are
taxable. It does not authorize taxation merely
because today’s technology requires technical exper-
tise not ordinarily possessed by the typical legal pro-
fessional. It does not say that activities that
encourage cost savings may be taxed. Section
1920(4) authorizes awarding only the cost of making
copies.
20 COUNTRY VINTNER v. E. & J. GALLO WINERY
Id. at 169 (footnote omitted). The court recognized that "ex-
tensive ‘processing’" may be "essential to make a comprehen-
sive and intelligible production" of ESI. Id.Hard drives may need to be imaged, the imaged
drives may need to be searched to identify relevant
files, relevant files may need to be screened for priv-
ileged or otherwise protected information, file for-
mats may need to be converted, and ultimately files
may need to be transferred to different media for
production.
Id. Nonetheless, the court reasoned, "that does not mean that
the services leading up to the actual production constitute
‘making copies.’" Id.The process employed in the pre-digital era to pro-
duce documents in complex litigation similarly
involved a number of steps essential to the ultimate
act of production. First, the paper files had to be
located. The files then had to be collected, or a docu-
ment reviewer had to travel to where the files were
located. The documents, or duplicates of the docu-
ments, were then reviewed to determine those that
may have been relevant. The files designated as
potentially relevant had to be screened for privileged
or otherwise protected material. Ultimately, a large
volume of documents would have been processed to
produce a smaller set of relevant documents. None
of the steps that preceded the actual act of making
copies in the pre-digital era would have been consid-
ered taxable. And that is because Congress did not
authorize taxation of charges necessarily incurred to
discharge discovery obligations. It allowed only for
the taxation of the costs of making copies.
Id. The Third Circuit further reasoned that the Supreme Court
has "accorded a narrow reading to the cost statute in other
COUNTRY VINTNER v. E. & J. GALLO WINERY 21
contexts," and "[n]either the degree of expertise necessary to
perform the work nor the identity of the party performing the
work of ‘making copies’ is a factor that can be gleaned from
§ 1920(4)." Id. at 169, 171. "Nor may the courts invoke equi-
table concerns . . . to justify an award of costs for services that
Congress has not made taxable." Id. at 170.
We find the Third Circuit’s reasoning persuasive. The court
properly took into account the statute’s history, its plain lan-
guage, and the Supreme Court’s narrow contemporary inter-
pretation of the costs taxable under § 1920. All of these
considerations support the conclusion that, in this case, sub-
section (4) limits taxable costs to those identified by the dis-
trict court: converting electronic files to non-editable formats,
and burning the files onto discs.19
That Gallo will recover only a fraction of its litigation costs
under our approach does not establish that our reading of the
statute is too grudging in an age of unforeseen innovations in
litigation-support technology.20 The Supreme Court has
emphasized that "costs almost always amount to less than the
successful litigant’s total expenses," and § 1920 is "limited to
19
We are mindful that converting ESI from editable to non-editable for-
mats, or copying ESI in its native format, often encompasses the copying
of metadata. See supra n.4. If, for instance, a case directly or indirectly
required production of ESI-unique information such as metadata, we
assume, without deciding, that taxable costs would include any technical
processes necessary to copy ESI in a format that includes such informa-
tion. This case does not fall within those limited circumstances.
20
We are not confronted with a case in which the parties clearly agreed
to the production of ESI on a particular database or in native file format.
Thus, we have no occasion to consider the scope of allowable costs for the
production of ESI under such circumstances. Compare In re Ricoh Co.,
Ltd. Patent Litig., 661 F.3d 1361, 1365-66 (Fed. Cir. 2011) (holding, when
parties agreed to produce ESI in native file format on particular database,
that "the costs of producing a document electronically can be recover-
able," including basic costs of the database), with Race Tires, 674 F.3d at171 n.11 (stating that In re Ricoh "is plainly distinguishable" on this
basis).
22 COUNTRY VINTNER v. E. & J. GALLO WINERY
relatively minor, incidental expenses." Taniguchi, 132 S. Ct.
at 2006. Moreover, "the presumption is that the responding
party must bear the expense of complying with discovery
requests." Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340,
358 (1978). To the extent that such costs are excessive, a
party "may invoke the district court’s discretion under [Fed.
R. Civ. P. 26] to grant orders protecting [it] from undue bur-
den or expense . . . , including orders conditioning discovery
on the requesting party’s payment of the costs of discovery."
Id. (internal quotation marks omitted). When, as here, a dis-
trict court denies a protective order, the movant can appeal
that decision; it cannot obtain the same relief from § 1920,
which "impose[s] rigid controls on cost-shifting in federal
courts." Crawford Fitting Co., 482 U.S. at 444.21
For all these reasons, we agree with the district court’s
finding that, in this case, only the conversion of native files
to TIFF and PDF formats, and the transfer of files onto CDs,
constituted "making copies" under § 1920(4).22
2.
We next determine whether Gallo’s ESI processing charges
are taxable as "[f]ees for exemplification." 28 U.S.C.
§ 1920(4). We think not.
Gallo argues that "[e]xtracting text and metadata" consti-
tutes exemplification because they "illustrate by example [the]
important features of the native files." Opening Br. 36–37
(internal quotation marks omitted). Gallo further argues that
21
Notably, Gallo does not appeal the district court’s denial of a protec-
tive order in this case.
22
Gallo does not challenge—and thus, we need not review—the district
court’s conclusion that Gallo had included "various multi-task entries in
the bill of costs," and thus, had failed to prove entitlement to taxable costs
"other than those . . . in [the] order." Country Vintner of N.C., LLC, 2012
WL 3202677, at *3 n.5.
COUNTRY VINTNER v. E. & J. GALLO WINERY 23
"loading . . . ESI into a review platform" constitutes exempli-
fication because it "illustrates by example the important fea-
tures of the ESI as if someone were seeing the ESI in its
native computer environment." Id. at 37 (internal quotation
marks omitted).
"Exemplification" has appeared in the statute since 1853,
when the word meant "an illustration by example"23 or "[a]n
official transcript of a document from public records, made in
[a] form to be used as evidence, and authenticated as a true
copy."24 Today, the word means "the act or process" of
"show[ing] or illustrat[ing] by example,"25 or "[a]n official
transcript of a public record, authenticated as a true copy for
use as evidence."26
Other circuits are split over the meaning of "exemplifica-
tion" as used in § 1920(4). For instance, the Federal Circuit,
applying Sixth Circuit law, has found that "exemplification"
is constrained to its legal meaning—"an official transcript of
a public record, authenticated as a true copy to use as evi-
dence"—because Congress did not adopt "the broad phrase
‘demonstrative evidence.’" Kohus v. Cosco, Inc., 282 F.3d
1355, 1358–59 (Fed. Cir. 2002). The Seventh Circuit has
taken a more expansive view, interpreting "exemplification"
to mean "the act of illustration by example," a definition
"broad enough to include a variety of exhibits and demonstra-
tive aids." Cefalu v. Vill. of Elk Grove, 211 F.3d 416, 427 (7th
Cir. 2000).
23
Noah Webster, A Dictionary of the English Language, Abridged from
the American Dictionary 142 (1850). See also John Walker, A Critical
Pronouncing Dictionary 132 (1858) (defining "exemplification" as "[a]
copy, a transcript, an illustration by example; draught for a record").
24
Benjamin Vaughan Abbott, Dictionary of Terms and Phrases Used in
American or English Jurisprudence 463 (1879).
25
Merriam-Webster Dictionary online, http://www.merriam-
webster.com/dictionary/exemplification and http://www.merriam-
webster.com/dictionary/exemplify (last visited April 5, 2013).
26
Black’s Law Dictionary (9th ed. 2009).
24 COUNTRY VINTNER v. E. & J. GALLO WINERY
We need not determine in this case which view is most har-
monious with the statute. Gallo’s charges include neither
authentication of public records nor exhibits or demonstrative
aids. Accordingly, the district court correctly concluded that
"the . . . costs in this case [do] not qualify as fees for exempli-
fication." Country Vintner of N.C., LLC, 2012 WL 3202677,
at *2 n.4.
IV.
In sum, for the reasons set forth, we agree with the district
court’s finding that only the conversion of native files to TIFF
and PDF formats, and the transfer of files onto CDs, consti-
tuted "making copies" under § 1920(4), and that none of
Gallo’s expenses constituted "[f]ees for exemplification."
AFFIRMED