Northern California Record

Monday, November 18, 2019

Judge gives VMWare mixed ruling on clerk's taxation of costs for trial with Phoenix Technologies

Lawsuits

By Sandra Lane | Oct 17, 2018

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SAN FRANCISCO – After the culmination of a jury trial to settle a lawsuit between two tech companies, a federal court has ruled to deny in part a motion of review of costs submitted by the defendant.

The U.S. District Court for the Northern District of California on Sept. 30 granted in part and denied in part VMWare's motion for review of clerk's taxation of costs.

Phoenix Technologies LTD sued VMWare Inc. in 2015 for what Phoenix alleged was unauthorized use of computer programs that had been licensed to VMWare for limited purposes. Phoenix alleged breach of contract and copyright infringement.

A jury at a two-week trial beginning on May 30, 2017, found that defendant "was not liable for copyright infringement or contributory copyright infringement, and even if it were, plaintiff had waived any such claims against defendant,” the ruling states.

The defendant filed a motion for review of the clerk's taxation of cost in February, to which the plaintiff filed an opposition the following month.

The court’s ruling explained that the losing party has the burden of proving why costs should not be awarded. On the other hand, the party that is seeking to recover costs bears the burden of proving the necessity for the amount of costs and expenses requested.

“Defendant initially sought $900,951.22 in costs, of which the clerk allowed $187,626.44 and disallowed $713,324.78. ... Defendant withdrew a request for $4,883.56 in airfare costs, bringing its total request to $895,970.16. Plaintiff ... requests that the court lower the amount of fees taxed from $187,626.44 to $115,714.56,” the ruling states.

Judge Haywood S. Gilliam Jr. said, “The court orders the clerk to reduce the amount taxed for Discovia production costs by $77,063.06. The clerk was correct to deny the overage costs and electronic database hosting fees,” he said. “Such e-discovery storage costs or hosting fees are not taxable. ... Therefore, the court denies defendant’s challenge to the $103,635 in overage costs and $280,431.90 in electronic database hosting fees disallowed by the clerk.”

Regarding other items, the judge said that the court denies defendant’s challenge to the clerk’s disallowance of $223,000 in fees from OpenAxes.

He also denied defendant’s challenge to the amount spent on visual aids. He ordered the clerk to increase the amount taxed by $13,734, for a total visual aid tax of $59,007.54.

The court also denied defendant’s challenge to the clerk’s taxation of witness fees and expenses. Defendant sought $7,264.17 in witness fees, of which the clerk allowed $1,754.15 and disallowed $5,510.02 as an excessive expense.

“Defendant shall file an accounting and documentation of the costs of the trial transcripts, as directed supra, within seven days of the date of this order. The clerk shall not adjust its taxation of costs until the court receives and reviews defendant's filing and issues a final order directing the clerk to tax costs. Again, no further argument will be entertained on this motion,” the ruling states.

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