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for the Southern District of New York

Court Awards Plaintiff Attorneys’ Fees and Expenses Incurred As A Result Of Defendant’s Improper Cancellation of A Deposition.

In a March 18, 2014 Opinion and Order, Judge Gabriel W. Gorenstein granted plaintiffs John Wiley & Sons, Inc., Cengage Learning, Inc., and Pearson Education, Inc.’s motion seeking an order requiring defendants Book Dog Books, LLC and Philip Smyres to pay the expenses plaintiffs incurred when Smyres’s counsel cancelled the second day of his deposition the night before it was scheduled to occur in the plaintiffs’ copyright infringement action.

The Court had previously found that defendants had failed to present an adequate excuse for why they did not appear at their deposition, and gave plaintiffs leave to file the instant application for expenses. In opposition to plaintiffs’ request, defendants argued “[t]he discovery disputes addressed in the Feb. 20 and Feb. 24 letters would have occurred even if Mr. Smyres had submitted to deposition [and thus] Mr. Smyres should not be assessed for the cost of litigation events that would have happened in any event.”

The court wrote that, pursuant to Rule 37(d), a court may award a variety of sanctions against a party that fails to appear for a deposition but “must” require the recalcitrant party or its attorney or both “to pay the reasonable expenses, including attorney’s fees, caused by the failure, unless the failure was substantially justified or other circumstances make an award of expenses unjust.” Furthermore, “[a] failure described in Rule 37(d)(1)(A) is not excused on the ground that the discovery sought was objectionable, unless the party failing to act has a pending motion for a protective order under Rule 26(c).”

Here, there court held that there was no doubt that defendants’ conduct fell within the purview of Rule 37(d). It is undisputed that Smyres was given proper notice of the February 20 deposition and that he knowingly chose not to attend. Under Rule 37(d), [c]onduct is substantially justified if there was a genuine dispute or if reasonable people could differ as to the appropriateness of the contested action.” Rule 37 places the burden of proof on the disobedient party to show “that his failure is justified or that special circumstances make an award of expenses unjust.”

The defendants presented no case law or other authority supporting their view that they had the authority to cancel the Smyres deposition at the last minute, without the filing of a protective order as required by Rule 37(d)(2), based solely on their separate discovery disputes with plaintiffs. Further, the court did not accept defendants’ argument that, in light of the presumption in the Federal Rules that a witness need only appear for a 7-hour deposition, see Fed. R. Civ. P. 30(d)(1), they could have cancelled the deposition at any time without penalty. Here, defendants had already agreed to the second day of a deposition and had even agreed on a specific date for it to occur. Defendants argued that it would be improper to issue sanctions in these circumstances because defendants “sincerely believed they had a good faith and proper reason for not appearing.” Even accepting defendant’s counsel’s statement as to her good faith, it is well- established that a party applying for sanctions under Rule 37(d) is not required to prove that the party who failed to attend the deposition acted in bad faith.

A party applying for fees under Rule 37(d) is allowed to recover reasonable expenses to the extent that those expenses were “caused” by the opposing party’s discovery violation Accordingly, where an expense could reasonably have been avoided, that expense is not recoverable. Plaintiffs argued that Smyres’s failure to attend his deposition caused plaintiffs to sustain hotel expenses for two rooms for one night totaling $705.80 and travel expenses from Washington, D.C., to New York City by train totaling $934. The court ruled that such expenses were properly recovered under Rule 37. Plaintiffs sought the cancellation fee of $262.50 charged by the court reporter and produced an invoice showing that the court reporter charged plaintiffs this amount for a “Same Day Cancellation.” The court found that plaintiffs behaved reasonably in not cancelling the deposition after the events of February 19. While defendants assert in their response letter that they made it “crystal clear” to plaintiffs that Smyres would not show up for the deposition on February 20, the Court is sympathetic to plaintiffs’ view that they could not rely on this assertion and that it could have been an act of gamesmanship.

Finally, plaintiffs sought $2,640 in attorney’s fees “for a portion of the expense of filing the Motion to Compel and this Fee Application.” As noted, Fed. R. Civ. P. 37(d)(3) provides that a court “must” require that the party who improperly fails to attend a deposition, or its attorney, to pay “attorney’s fees” as part of the “reasonable expenses” required to be awarded under that rule. Thus, the court ruled that plaintiffs were entitled to be compensated for their fees in making the instant motion. Plaintiffs assert that their attorneys spent more than 15 hours drafting the motion to compel Smyres’s deposition, preparing for and attending the February 25 hearing, and drafting the instant fee application. Plaintiffs did not seek all 15 hours, however. Instead, they requested fees for five hours of Oppenheim’s time, billed at $348 per hour, and three hours of Chen’s time, billed at $300 per hour. The court awarded plaintiffs fees for eight hours of time, totaling $2,640.

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