Cordance Corp v. Amazon.com, Inc.

855 F. Supp. 2d 244, 2012 U.S. Dist. LEXIS 51268, 2012 WL 1194211
CourtDistrict Court, D. Delaware
DecidedApril 11, 2012
DocketCivil Action No. 06-491-MPT
StatusPublished
Cited by4 cases

This text of 855 F. Supp. 2d 244 (Cordance Corp v. Amazon.com, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cordance Corp v. Amazon.com, Inc., 855 F. Supp. 2d 244, 2012 U.S. Dist. LEXIS 51268, 2012 WL 1194211 (D. Del. 2012).

Opinion

MEMORANDUM

MARY PAT THYNGE, United States Magistrate Judge.

I. INTRODUCTION

On August 8, 2006, plaintiff, Cordance Corporation (“Cordance”) filed this patent infringement matter against defendant, Amazon.com, Inc. (“Amazon”). After trial, motions for judgment as a matter of law, bench trial on inequitable conduct and patent misuse, and an appeal to the Federal Circuit, the matter was adjudicated in favor Amazon. Presently before the court is Amazon’s bill of costs in the amount of $591,824.69 filed on November 14, 2011.1 In its bill of costs, Amazon requests $1,378.78 for printing, $447,694.69 for electronic discovery, $51,323.62 for exemplifications, and $62,353.24 for deposition expenses, $1,498.99 for filing fees, and $27,575.37 for witness fees and subsistence costs.

On November 28, 2011, Cordance filed objections to Amazon’s bill of costs.2 In its objections, Cordance alleges Amazon is not entitled to any costs incurred because Amazon engaged in dilatory tactics which increased expenses for both parties and Cordance is indigent and thus, unable to pay the costs requested.3 Alternatively, Cordance argues if costs are awarded, they should be significantly reduced because Amazon’s demand is improper or fatally unsubstantiated. Specifically, Cor-dance maintains Amazon’s costs for ediscovery, Markman demonstrative exhibits (or exemplifications), depositions and witness fees should be drastically reduced. Cordance does not object to Amazon’s request for printing and copying costs and filing fees totaling $3,202.74.4 Amazon responded to Cordance’s objections on December 5, 2011.5

For the following reasons, the court will grant in part and deny in part Amazon’s request for costs and will deny Cordance’s request to have Amazon’s bill of costs denied in its entirety.

II. DISCUSSION

A. Dilatory Tactics by Amazon

Cordance argues Amazon engaged in dilatory tactics during litigation, and such [247]*247improprieties bar Amazon’s recovery for costs.

In support of its position, Cordance relies on In re Paoli R.R. Yard PCB Litig6 When evaluating a bill of costs by a prevailing party, the Paoli court considered “the prevailing party’s unclean hands, bad faith, dilatory tactics or failures to comply with process during the course of the instant litigation or the costs award proceedings.”7 In determining what are dilatory tactics by a prevailing party,8 the Third Circuit has repeatedly relied on the Seventh Circuit case Chicago Sugar Co. v. American Sugar Refining Co., which noted examples of dilatory tactics as “calling unnecessary witnesses, bringing in unnecessary issues or otherwise encumbering the record, or by delaying in raising objections fatal to the plaintiffs case.”9 The Third Circuit recognizes denying costs, where the prevailing party has unduly extended or complicated resolution of the issues, is balanced with an attorney’s duty to provide a client complete and vigorous representation by raising good faith claims or defenses on its behalf.10 In balancing these factors, the court must evaluate an attorney’s decision at the time it was made and not with the aid of hindsight obtained through discovery.11

Here, Cordance claims “Amazon repeatedly failed to provide basic discovery, violated the court’s discovery orders, made empty promises to produce discovery materials, and produced unprepared Rule 30(b)(6) deposition witnesses.”12 Cordance further asserts Amazon unreasonably maintained a vague, unsupported counterclaim which it refused to dismiss despite this court’s directive to provide evidence to substantiate it.

Amazon denies using dilatory tactics and rejects Cordance’s accusations as unfounded. Amazon represents it always complied with court orders regarding production of financial documents. Amazon further notes Cordance’s 30(b)(6) deposition notice was extremely broad by including 223 topics (later reduced to 208 topics). Amazon maintains it worked with Cordance to produce witnesses “educated about the accused systems and if Cordance was not satisfied, [it] could move to compel further testimony.”13 Amazon argues its cooperative efforts are now condemned as dilatory tactics. Finally, Amazon claims as to its counterclaim, no Rule 11 motion was filed and it survived two motions to dismiss. Amazon compares the subsequent dismissal of its counterclaim as akin to Cordance’s dismissal of its '205 patent claims.14

Cordance, maintains “Amazon’s dilatory tactics ... are evident.”15 However, Cor-dance only cites six references in the record as evidence of dilatory tactics, despite claiming Amazon “repeatedly failed to provide basic discovery [and] violated the [248]*248Court’s discovery orders.”16 The docket in this litigation contains over 600 entries, and only two out of the six entries cited by Cordanee pertain to a single discovery dispute in January 2009. Although Amazon’s dilatory tactics are purportedly obvious, this court will not review and parse through the entire docket to ferret out the “evident” improprieties. Based on the evidence presented by Cordanee, the court cannot find that Amazon “encumber[ed] the record.”17

B. Cordance’s Inability to Pay

Cordanee argues inability to pay Amazon’s asserted costs due to indigency.

In deciding whether to award costs to a prevailing party, the Third Circuit allows a court to consider “the losing [party’s] potential indigency or inability to pay the full measure of a costs award levied against them.”18 “[A] party may be excepted from costs if he is in fact indigent, if he has adduced evidence that he is indigent, and if the district court sees fit to reduce the costs award imposed for reasons of equity.” 19

In support of its claim of indigency, Cordanee has submitted the affidavit of Brian E. Lewis, its General Counsel, which gives an overview of revenue, losses, assets and liabilities.20 According to Lewis, Cor-dance has incurred a loss for the past three years, including a loss of $706,874.00 in 2010. In addition, Cordance’s current liabilities are $17,397,102.00, while its assets are $23,057.00.21

Amazon responds that courts routinely do not allow corporations to claim indigency,22 and Cordanee failed to provide a complete accounting of its assets. Amazon relies on a 1997 valuation from Coopers and Lybrand which valued a license for Cordance’s intellectual property at fifty million dollars. In addition, it cites a document Cordanee purportedly submitted to the bankruptcy court with an estimated liquidation value of Cordance’s patents between $250,000.00 and $500,000.00 as of December 31, 2003.23 Amazon further references other currently pending patent infringement actions24 and an insurance policy with Lloyd’s of London.25

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Bluebook (online)
855 F. Supp. 2d 244, 2012 U.S. Dist. LEXIS 51268, 2012 WL 1194211, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cordance-corp-v-amazoncom-inc-ded-2012.