Judge Lisa K. Sepe-Wiesenfeld, Case Number: 21SMCV01129, Date: 2025-01-22 Tentative Ruling

Judge: Lisa K. Sepe-Wiesenfeld, Case: 21SMCV01129, Date: 2025-01-22 Tentative Ruling

Plaintiffs Beach Point Select Master Fund, LP; Beach Point Securitized Credit Fund, LP; BPC Opportunities Fund II, LP; ThunderRoad Financial, LLC; and BP THR II Trust’s Motion to Tax Costs is GRANTED. Defendant Vervent, Inc.’s costs are TAXED in the amount of $517,206.48. Defendant Vervent, Inc. is entitled to recover $22,309.73 in costs.

Plaintiffs Beach Point Select Master Fund, LP; Beach Point Securitized Credit Fund, LP; BPC Opportunities Fund II, LP; ThunderRoad Financial, LLC; and BP THR II Trust (“Plaintiffs”) move to strike Defendant Vervent, Inc. (“Defendant”)’s costs for (1) deposition costs in the amount of $17,363.55, (2) courtesy copies fees in the amount of $405.32, (3) legal research costs in the amount of $51,527.65, and (4) electronic document hosting costs in the amount of $457,836.41. Plaintiffs do not dispute that Defendant is the prevailing party and entitled to certain costs; rather, they take issue with these identified costs as unrecoverable or excessive.

While Plaintiffs sought to tax the deposition costs in the amount of $17,363.55 in the notice of motion, they reduce this amount to seek a total reduction of $7,437.10 in the reply. Plaintiffs take issue with Defendant ordering an overnight rush on the transcripts for the depositions of Sean Bennett and Tom Collins, totaling $2,992.80 in unnecessary charges as there is no justification presented for ordering expedited transcripts, and Defendant has not documented anything as to the deposition of Howard Grobstein. Reference to the declaration of Matthew H. Ladner shows that Defendant has set forth that it incurred $4,281.05 for the deposition of Howard Grobstein, and it sets forth the travel costs relating to that deposition, but it does not substantiate the cost of $4,281.05 for this deposition in any way. Accordingly, Defendant’s costs are TAXED in the amount of $7,437.10.

Defendant seeks $405.32 for fees incurred to provide courtesy copies, but this is not a specific allowable cost under Code of Civil Procedure section 1033.5. While the Court’s standing order requires courtesy copies for certain filings, this does not make these costs allowable. For that reason, Defendant’s costs are TAXED in the amount of $405.32.

As to Defendant’s costs of legal research as “other” costs in the amount of $51,527.65, “[f]ees for legal research, computer or otherwise, may not be recovered under section 1033.5.” (Ladas v. California State Automobile Association (1993) 19 Cal.App.4th 761, 776.) The Court declines to award these costs as discretionary allowable costs where Defendant presents no binding case law allowing for recovery of such costs. Thus, Defendant’s costs are TAXED in the amount of $51,527.65.

Defendant seeks to recover $457,836.41 for electronic document hosting, which is not a specified allowable cost under Code of Civil Procedure section 1033.5. In opposition to the present motion, Defendant states that it paid a third-party electronic hosting service provider known as Consilio so it could collect, convert, produce, and maintain electronic records and other information Plaintiffs demanded during discovery. Defendant argues that the Court has discretion to allow these costs, and the costs were reasonably necessary given the breadth of Plaintiffs’ claims and the discovery demands in this action. Defendant provides no legal authority showing that such costs are generally allowable even if not specified in the statute, and given that this cost is substantial, the Court expects more than simply stating that this was required, i.e., Defendant has not shown that no less expensive alternative was not available. The Court finds it improper to allow Defendant to recover such a substantial amount for what appears to have been a discretionary choice by Defendant. Accordingly, Defendant’s costs are TAXED in the amount of $457,836.41.