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O'Shaughnessy v. Cypress Media, L.L.C.

United States District Court, W.D. Missouri, Western Division

October 17, 2016

ELIZABETH O'SHAUGHNESSY, MICHAEL O'SHAUGHNESSY, and RANDALL L. HENSLEY, Plaintiffs,
v.
CYPRESS MEDIA, L.L.C., Defendant.

          ORDER DETERMINING AMOUNT OF SANCTIONS

          GREG KAYS, CHIEF JUDGE

         This lawsuit arose from Plaintiffs' allegations that Defendant Cypress Media, L.L.C. (“Cypress”), unlawfully “double-billed” them for newspaper subscriptions to The Kansas City Star. Now pending is the Court's August 24, 2016, Order imposing monetary sanctions on Cypress for discovery violations, and the parties' briefing concerning the amount of the sanction (Docs. 164, 169, 172). For the following reasons, the Court holds the amount should be $21, 152.98.

         Background

         Three weeks after the close of merits discovery in this case, and six days before filing its motion for summary judgment, Cypress disclosed seventy-five new documents to Plaintiffs. Cypress then used these documents to support its motion for summary judgment. Plaintiffs subsequently moved for sanctions (Doc. 138).

         The Court granted the motion for sanctions in part, holding Cypress violated Federal Rules of Civil Procedure 26(a) and (e) by failing to disclose twenty-two of these documents- various subscription invoice/renewal form templates[1]-earlier. O'Shaughnessy v. Cypress Media, L.L.C., No. 4:13-cv-0947-DGK, 2016 WL 4487886, at *5-6 (W.D. Mo. Aug. 24, 2016). The Court also held Cypress violated Rule 37 because the late disclosure prejudiced Plaintiffs by needlessly increasing their litigation costs. Id. at *8. As a sanction, the Court ordered Cypress to pay the reasonable expenses, including attorneys' fees, caused by the violation. Id.

         Discussion

         Plaintiffs request a total of $81, 267.75 in attorneys' fees, and they have submitted nine pages of billing records in support. Their request seeks reimbursement for all time spent: addressing Cypress's Rule 26 initial disclosures; reviewing documents produced in discovery; litigating discovery disputes; engaging in class certification discovery; opposing Cypress's motion for summary judgment; and litigating the motion for sanctions.

         Cypress responds that the Court should award a much lower amount, arguing an award of “$3, 000 would reasonably approximate the additional fees Plaintiffs incurred and would be commensurate with the nature of the violation the Court identified.” Def.'s Suggestions in Opp'n 10 (Doc. 169). Cypress argues Plaintiffs' request is disproportionate to “the relatively ‘mild prejudice' the Court identified” in its order, and that most of the amount Plaintiffs seek to recover “had no causal connection to delayed production of the templates.” Id. Cypress also contends Plaintiffs have failed to provide adequate information supporting their fee request.

         I. The reasonable expenses caused by the discovery violations total $21, 152.98.

         To begin, the Court clarifies that when it described the prejudiced suffered by Plaintiffs as “relatively mild, ” it did not mean that Cypress's discovery violation was trivial or merely a technical violation. O'Shaughnessy, 2016 WL 4487886, at *1. Rather, the Court found the violation did not justify the drastic relief sought by Plaintiff, such as revisiting the Court's class certification ruling or striking Cypress's summary judgment motion. Id. at 8. The appropriate sanction was a monetary sanction, a sanction which would make Plaintiffs whole without risking a miscarriage of justice by denying Cypress summary judgment on the merits. Id.

         With that in mind, the Court rules as follows concerning the amount of this sanction.

         A. One-third of the time spent reviewing documents is compensable.

         Plaintiffs seek $20, 075 in fees for time reviewing documents before Cypress produced the templates.[2] Cypress argues this time should not be compensable because Plaintiffs would have spent this time reviewing these documents anyway, and that, “[i]n fact, Plaintiffs spent less time reviewing documents than they would have if the templates had been produced.” Def.'s Suggestions in Opp'n 5.

         This argument overlooks the Court's previous finding: Cypress's failure to disclose the templates earlier prejudiced Plaintiffs because the information in the templates was “extremely useful in understanding exactly how and when the customer invoice/renewal form language changed.” O'Shaughnessy, 2016 WL 4487886, at *8. By not having this information earlier, Plaintiffs' counsel wasted time scrutinizing the documents Cypress did produce-such as individual subscription forms-for information that was easily learned from the templates. Granted, having the templates would not have eliminated entirely the need for Plaintiffs' counsel to review the documents Cypress did produce, but it would have enabled counsel to review them more efficiently. For example, if Cypress had produced the templates, counsel would have immediately learned how the subscription renewal language changed over time. But because they did not have the templates, they had to spend much more time reviewing individual subscription forms in an attempt to “reverse engineer” how the subscription renewal language changed over time, which was not an efficient process. Hence, Cypress's failure to produce the templates needlessly increased Plaintiffs' litigation costs by some amount.

         After closely reviewing the billing statements and applying the Court's experience in reviewing fee applications, the Court estimates this failure resulted in Plaintiffs' counsel expending at least one-third more time on document review than they otherwise would have. Accordingly, the Court finds Plaintiffs should recover one-third of the time requested, or $6, 691.67.

         B. Two-thirds of the time spent on the first discovery dispute teleconference is compensable.

         Plaintiffs also request $4, 634 for time spent on the parties' first discovery dispute teleconference, [3] which concerned whether discovery should be bifurcated into a class certification stage and a merits stage. Plaintiffs argued discovery should not be bifurcated, Cypress argued it should. The Court ruled discovery should be bifurcated (Doc. 26).

         Cypress contends that this dispute did not directly involve the templates or related issues, and that Plaintiffs should not be given fees for a teleconference they initiated.

         Plaintiffs respond that Cypress caused the discovery dispute by arguing that Plaintiffs' discovery requests, which included a request for any templates, went to the merits of the case, not class certification. Plaintiffs note that they tried to establish at the class certification stage that Cypress used standard form agreements/form templates with its subscription customers, but Cypress vehemently denied this and withheld the templates. Had Cypress ...


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