Case 2:15-cv-01202-WCB Document 390 Filed 07/18/17 Page 1 of 10 PageID #: 24448
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
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`Case No. 2:15-CV-1202-WCB
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`§§§§§§§§§§
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`ERFINDERGEMEINSCHAFT UROPEP
`GbR,
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`Plaintiff,
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`v.
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`ELI LILLY AND COMPANY,
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`Defendant.
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`MEMORANDUM OPINION AND ORDER
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`Plaintiff Erfindergemeinschaft UroPep GbR (“UroPep”) has moved for entry of a bill of
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`costs in this case. Dkt. No. 377. Defendant Eli Lilly and Company opposes in part. Dkt. No.
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`384. The motion is GRANTED IN PART and DENIED IN PART.
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`The parties have agreed on the bulk of the issues pertaining to costs, and they have settled
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`on an award in the amount of $100,485.08 for the unopposed costs in this case. Seeing no reason
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`to question the terms of the agreement of the parties on that portion of the award of costs, the
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`Court will order Lilly to pay UroPep that amount.
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`Two items remain in dispute. The first is the expense of the technology tutorial prepared
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`by UroPep in connection with the claim construction proceedings. The second is the expense
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`associated with the use of graphics and demonstratives at trial. The total amount that UroPep
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`claims for those two items is $106,831.63.
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`UroPep argues that it is entitled to an award of its expenses in connection with those two
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`items under 28 U.S.C. § 1920(4), which provides for costs to be taxed for “fees for
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`exemplification and copies of papers necessarily obtained for use in the case.” In particular,
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`1
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`UroPep contends that its expenses fall within the meaning of the term “exemplification,” as used
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`in section 1920.
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`Fifth Circuit law governs the issue of costs in a patent case. See CBT Flint Partners, LLC
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`v. Return Path, Inc., 737 F.3d 1320, 1325 (Fed. Cir. 2013); In re Ricoh Co., Ltd. Patent Litig.,
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`661 F.3d 1361, 1364 (Fed. Cir. 2011). Both the Supreme Court and the Fifth Circuit have
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`emphasized that section 1920 is to be strictly construed, and that costs that do not fall within the
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`literal terms of the statute are not to be awarded.
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`In Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437 (1987), the Supreme Court
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`held that section 1920 strictly limits the types of costs that may be awarded to a prevailing party.
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`Id. at 440-41. Citing an earlier case that referred to the predecessor of section 1920, the Court
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`wrote that the “comprehensive scope of the [prior] Act and the particularity with which it was
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`drafted demonstrated that Congress meant to impose rigid controls on cost-shifting in federal
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`courts.” Id. at 444. See also Taniguchi v. Kan Pac. Saipan, Ltd., 132 S. Ct. 1997, 2006 (2012)
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`(referring to “the narrow scope of taxable costs” allowed by section 1920: “[t]axable costs are
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`limited to relatively minor, incidental expenses”; “[b]ecause taxable costs are limited by statute
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`and are modest in scope, we see no compelling reason to stretch the ordinary meaning of the cost
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`items Congress authorized in § 1920”).
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`The Fifth Circuit has followed the Supreme Court’s lead, noting that “[t]he Supreme
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`Court has indicated that federal courts may only award those costs articulated in section 1920
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`absent explicit statutory or contractual authorization to the contrary,” and that the Supreme Court
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`has admonished “that we strictly construe this provision.” Mota v. Univ. of Tex. Houston Health
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`Sci. Ctr., 261 F.3d 512, 529-30 (5th Cir. 2001). See also Coats v. Penrod Drilling Corp., 5 F.3d
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`2
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`Case 2:15-cv-01202-WCB Document 390 Filed 07/18/17 Page 3 of 10 PageID #: 24450
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`877, 891 (5th Cir. 1993) (“28 U.S.C. § 1920 defines recoverable costs, and a district court may
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`decline to award the costs listed in the statute but may not award costs omitted from the list.”).
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`Consistent with the “strict construction” given to section 1920 by the Supreme Court and
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`the Fifth Circuit, the Federal Circuit has construed the term “exemplification” narrowly to be
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`limited to “an official transcript of a public record, authenticated as a true copy for use as
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`evidence.” Summit Tech., Inc. v. Nidek Co., 435 F.3d 1371, 1374-78 (Fed. Cir. 2006) (denying
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`an award of costs for the fee of a consultant who assisted counsel in preparing trial exhibits,
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`including computer animations, videos, powerpoint presentations and graphic illustrations);
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`Kohus v. Toys ‘R’ Us, Inc., 282 F.3d 1355. 1359 (Fed. Cir. 2002) (denying an award of costs for
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`a video animation used at trial). Although in those cases the Federal Circuit was applying the
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`law of the First and Sixth Circuits, respectively, the Fifth Circuit employs the same restrictive
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`approach.1 Thus, in Coats v. Penrod Drilling Corp., 5 F.3d at 891, the Fifth Circuit held that the
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`expenses for certain “blow-ups” used at trial were “not included in § 1920 and therefore are not
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`recoverable.” And in Johns-Manville Corp. v. Cement Asbestos Prods. Co., 428 F.2d 1381,
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`1385 (5th Cir. 1970), the court held that, absent prior approval from the court, the expenses of
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`producing certain models and charts used at trial could not be assessed as costs. See also
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`Gagnon v. United Technisource, Inc., 607 F.3d 1036, 1045 (5th Cir. 2010) (“federal courts may
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`only award those costs articulated in section 1920 absent explicit statutory or contractual
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`authorization to the contrary”); Louisiana Power & Light Co. v. Kellstrom, 50 F.3d 319, 335 (5th
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`Cir. 1995) (absent pretrial approval from the court, production costs for exhibits may not be
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`assessed as costs); Webster v. M/V Moolchand, Sethia Liners, Ltd., 730 F.2d 1035, 1040 (5th
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`1 As does the Eleventh Circuit, applying former Fifth Circuit law. See Arcadian
`Fertilizer, L.P. v. MPW Indus. Servs., Inc., 249 F.3d 1293, 1297 (11th Cir. 2001) (applying the
`former Fifth Circuit precedent to conclude that “exemplification” does not include videotapes or
`computer animations).
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`3
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`Cir. 1984) (the language of section 1920 “seems to preclude its extension beyond the payment of
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`the actual cost of exemplification and reproduction of copies”); Mobile Telecomms. Techs.,
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`LLC v. Samsung Telecomms. Am., LLC, No. 2:13-cv-259, 2015 WL 5719123, at *2-3 (E.D.
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`Tex. Sept. 28, 2015) (construing “exemplification” narrowly, consistent with Fifth Circuit
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`precedents); Kellogg Brown & Root Int’l v. Altanmia Commercial Mktg. Co., Civil Action No.
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`H-07-2684, 2009 WL 1457632, at *4 (S.D. Tex. May 26, 2009) (Rosenthal, J.) (Fifth Circuit
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`“follows the narrow approach” in defining “exemplification”). Those principles require the
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`Court to hold that neither of UroPep’s two disputed cost items constitute “exemplifications”
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`within the meaning of section 1920(4).
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`1. The Technology Tutorial
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`UroPep first asserts that it is entitled to an award of its expenses for the technology
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`tutorial it prepared in connection with the claim construction proceedings. That claim is
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`meritless.
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` Attempting to find support from a line of Fifth Circuit cases that have allowed certain
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`expenses to be chargeable as costs if they were approved in advance by the district court, UroPep
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`asserts that the Court “solicited” (Dkt. No. 377, at 5) and “invited” (id. at 6 n.6; see also Dkt. No.
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`386, at 5) technology tutorials. That is simply not true. The only support UroPep cites for those
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`assertions is the Court’s sequence of docket control orders, which provided, in pertinent part, for
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`a deadline to “Submit Technical Tutorials (if any).” Dkt. No. 71, at 3; Dkt. No. 96, at 3; Dkt.
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`No. 104, at 3. That is not an “invitation” or a “solicitation” for technology tutorials; it is a
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`provision that allows the parties to file tutorials if they wish, and gives them a deadline for filing
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`them if they choose to do so.
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`4
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`If there were any doubt on that score, it should have been clear from Judge Payne’s
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`opinion in DSS Technology Management Inc. v. Taiwan Semiconductor Manufacturing Co., No.
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`2:14-cv-199, 2016 WL 5942316 (E.D. Tex. Oct. 13, 2016). In that case, Judge Payne denied a
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`motion to include the expenses of a technology tutorial in the prevailing party’s award of costs.
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`The court discussed the language of the docket control order in that case, which is identical to the
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`language of the docket control order in the present case. He explained that, contrary to the
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`defendant’s argument, the docket control order, “which permitted the parties to ‘Submit
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`Technical Tutorials (if any)’” by a particular date “simply extended the deadline to submit any
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`tutorials that that the parties wished to submit. . . . The Court did not require a tutorial.” Id. at
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`*7. The same is plainly true here.2
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`Stripped of the “prior approval” contention, UroPep’s argument collapses. Under no
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`plausible interpretation does a video technology tutorial qualify as an “exemplification” within
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`the meaning of section 1920(4). See Mobile Telecomms. Techs., LLC, 2015 WL 5719123, at
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`*2-3. And there is no other subsection of section 1920 that is remotely applicable to the
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`technology tutorial. UroPep chose to offer the technology tutorial for its own purposes, seeking
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`to improve its position in the claim construction proceedings. Nothing in the policies
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`undergirding the costs statute justifies shifting the cost of that choice to UroPep’s adversary.
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`2 UroPep cites this Court’s opinion in Kroy IP Holdings, LLC v. Safeway, Inc., No.
`2:12-cv-800, 2015 WL 4776501, at *2 (E.D. Tex. Aug. 13, 2015), where the Court denied a
`request for costs for the expenses of a technology tutorial, but noted in passing that “[c]osts for
`technical tutorials may be recoverable in cases involving complicated technical matters, where
`the tutorials are ‘reasonably necessary to assist the Court in understanding the issues.’” The
`cases cited in support of that proposition, however, were both cases in which the court had
`requested technology tutorials, which was not true here. Moreover, this case did not involve
`complex technology as to which a technology tutorial was likely to be helpful, and for that
`reason, the Court saw no reason to request one or to encourage the parties to submit one.
`5
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`The request for an award of costs for the expense of preparing the technology tutorial is
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`denied.
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`2. The Demonstratives and the PDE5 Models Used at Trial
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`Similar analysis applies to UroPep’s argument that it should be awarded costs for the
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`expenses UroPep incurred in preparing the demonstratives it used at trial, including the models
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`of the PDE5 molecule that UroPep used during the testimony of its expert witness. Those
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`expenses included, according to UroPep, the services of a consultant (together with off-site
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`support) both before and during the trial.
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`The problem with UroPep’s argument is that models and demonstratives used at trial but
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`not introduced into evidence do not fit within the definition of “exemplifications.” Moore’s
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`Federal Practice explains that recoverable “exemplification” costs “may include the expense of a
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`computerized, multi-media system employed to present exhibits to the jury, if that system is
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`reasonably necessary for the presentation of information.” 10 James Wm. Moore, Moore’s
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`Federal Practice ¶ 54.103[3][d], at 54-203 (3d ed. 2017). But “a video exhibit or a physical
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`model may not qualify as an ‘exemplification’ if it is essentially explanatory and argumentative,
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`serving merely as an aid to the argument of counsel and the explanations of expert witnesses.
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`Similarly, the costs of computer animations, videos, Powerpoint presentations, and graphic
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`illustrations used to explain the case to the jury and the trial court do not qualify as
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`‘exemplification’ costs recoverable under § 1930(4).” Id. UroPep’s demonstratives and models
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`fall within the second of Professor Moore’s categories, not the first.
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`The Fifth Circuit has on several occasions indicated that expenses for such items do not
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`fall within the scope of recoverable costs, at least absent prior approval from the court. In Coats
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`v. Penrod Drilling Corp., 5 F.3d at 891, the Fifth Circuit rejected a request for an award of costs
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`6
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`for “blow-ups,” among other expenses, on the ground that “[t]hese expenses are not included in
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`§ 1920 and therefore are not recoverable.” Similarly, in Studiengesellschaft Kohle mbH v.
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`Eastman Kodak Co., 713 F.2d 128, 132-33 (5th Cir. 1983), the court rejected a request for an
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`award of costs for the preparation of “charts, models, and photographs” on the ground that “since
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`there is no statutory provision for the award of costs for charts, models and photographs, they
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`may be taxed as costs only if there is a pretrial authorization by the trial court.” And in Johns-
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`Manville Corp. v. Cement Asbestos Products Co., 428 F.2d at 1385, the court rejected a request
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`for an award of costs for “models and charts,” holding that because “no prior approval [was]
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`obtained from the Court by CAPCO to produce the models and charts in question, the costs must
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`be disallowed.” See also Kroy IP Holdings, LLC v. Safeway, Inc., No. 2:12-cv-800, 2015 WL
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`4776501, at *3 (E.D. Tex. Aug. 13, 2015); Alzheimer’s Inst. of Am., Inc. v. Avid Radiopharms.,
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`No. 10-6908, 2016 WL 1161349, at* 1 (E.D. Pa. Mar. 23, 2016) (citations omitted) (“Material
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`that is ‘essentially explanatory and argumentative’ does not qualify as taxable exemplification. . .
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`. Visual aids used in counsel’s arguments and in the testimony of expert witnesses are not
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`taxable.”); Akanthos Capital Mgmt., LLC v. Compucredit Holdings Corp., 2 F. Supp. 3d 1306,
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`1308 (N.D. Ga. 2014) (“Defendants are not entitled to an award of the costs of graphics and
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`technology consulting services,” which do not “fit into the exemplification category.”);
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`Scaramucci v. Universal Mfg. Co., 234 F. Supp. 290, 291-92 (W.D. La. 1964) (expenses in
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`producing models and charts used in connection with expert’s testimony are not chargeable as
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`costs).
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`Nor is the fact that the parties exchanged demonstratives in advance of their use at trial
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`helpful to UroPep. The exchange of demonstratives was designed to avoid disputes during the
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`trial over the contents of the demonstratives; the court-directed schedule for disclosing
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`7
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`demonstratives to the opposing party did not constitute court approval of the use of
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`demonstratives that would make those items subject to the provisions of the costs statute.3 The
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`Fifth Circuit rejected a similar argument in Louisiana Power & Light, where it ruled that
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`“[r]equiring the exchange of exhibits prior to trial does not imply authorization of production of
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`those exhibits.” 50 F.3d at 335.
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`To be sure, UroPep has cited several cases from this district in which courts have
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`awarded costs for audio/visual services and graphics used at trial: Motio, Inc. v. BSP Software
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`LLC, No. 4:12-cv-647, 2016 WL 4430452 (E.D. Tex. Aug. 22, 2016); Cheetah Omni LLC v.
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`Alcatel-Lucent USA Inc., No. 6:11-cv-390, 2014 WL 1151136 (E.D. Tex. Apr. 15, 2014);
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`Realtime Data, LLC v. T-Mobile USA, Inc., No. 6:10-cv-493, 2013 WL 12156681 (E.D. Tex.
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`May 1, 2013); Eolas Techs. Inc. v. Adobe Sys., Inc., 891 F. Supp. 2d 803 (E.D. Tex. 2012);
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`Synqor, Inc. v. Artesyn Techs., Inc., No. 2:07-cv-497, 2011 WL 4591893 (E.D. Tex. Sept. 30,
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`2011); Finisar Corp. v. DirecTV Grp., Inc., No. 1:05-cv-264, 2006 WL 2699732 (E.D. Tex. Aug.
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`4, 2006).4 A close examination of those cases, however, shows that the cited line of authority is
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`not as supportive of UroPep’s position as UroPep contends.
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`3 Although the Court made clear early in the proceedings that it expected the parties to
`exchange any demonstratives they intended to use in advance of their use at trial, the Court at the
`same time expressed skepticism about the use of demonstratives. Although the Court did not
`prohibit the parties from using them at trial, it hardly can be said to have encouraged or endorsed
`their use. See Dkt. No. 231, at 246-47 ([T]he use of demonstratives [is] sort of a beast that has
`been created by practice more than anything else. But there is often a dispute about whether the
`demonstratives are accurate and so forth. So with respect to demonstratives that you plan to use,
`I’m not going to say you can’t use them. But I would insist that they be presented to the other
`side for consideration the day before, usually after court the day before so that any objection can
`be lodged.”).
`4 UroPep cites this Court’s order in Versata Software, Inc. v. Internet Brands, Inc., No.
`2:08-cv-313 (E.D. Tex. Oct. 9, 2012), in support of its argument that the expenses of preparing
`demonstratives should be chargeable as costs. In that case, however, the parties agreed on all the
`items that should be included in the bill of costs, so the Court had no occasion to decide whether
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`In several of the cited cases, the party opposing the assessment of costs conceded that
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`some of the costs of a technical trial support vendor were recoverable and disputed only the
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`amount of the costs. See Motio, 2016 WL 4430452, at *12 (defendants agreed to cover costs of
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`on-site support, which court ordered); Synqor, 2011 WL 4591893, at *3 (defendants accepted
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`inclusion of audio and visual professional services for trial time; court directed that the costs
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`award include some trial preparation time as well). In Cheetah Omni, the plaintiff objected to an
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`award of costs for audio/visual services because the case did not go to trial and because some of
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`the expenses were related to the video synchronization of depositions. See No. 6:11 cv-390,
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`2014 WL 1141136, at *5. But the plaintiff in that case did not argue that such audio/visual
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`services are not “exemplifications” within the meaning of section 1920(4). See No. 6:11-cv-390,
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`Dkt. No. 448, at 11-12 (E.D. Tex. Mar. 10, 2014). Similarly, in the Realtime Data case, the party
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`opposing the assessment of costs did not object to the award of costs for audio and video services
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`per se, but only objected to the amount of the requested award for those services. See No. 6:10-
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`cv-493, 2013 WL 12156681, at *3. The plaintiff in that case argued only that the amount
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`requested for the audio-visual services was excessive, and the court agreed. No. 6:10-cv-493,
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`Dkt. No. 667, at 6-8 (E.D. Tex. Apr. 29, 2013). Likewise, in Eolas the plaintiffs did not argue
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`that the expenses of professional support for audio and video services performed during the trial
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`were not compensable. See No. 6:09-cv-446, Dkt. No. 1404 (E.D. Tex. Apr. 26, 2012). And in
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`the Finisar case, the court treated its pretrial directions to the parties to agree upon an efficient
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`manner of presenting the case to the jury as prior authorization for the use of professional trial
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`technicians “to present nearly every aspect of the case.” No. 1:05-cv-264, 2006 WL 2699732, at
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`*2 (citing the “prior authorization” rationale of J.T. Gibbons, Inc. v. Crawford Fitting Co., 760
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`particular components of the cost award could have been challenged as beyond the scope of
`section 1920.
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`9
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`F.2d 613, 615 (5th Cir. 1984)). As noted, there was no such prior authorization, express or
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`implied, for the use of demonstratives or models in this case.5
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`Based on the language of section 1920 and the interpretation of that statute by the
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`Supreme Court and the Fifth Circuit, this Court concludes that the expenses associated with
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`preparing the graphics, demonstratives, and models of the PDE5 molecule are not compensable
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`costs that can be awarded to UroPep.
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`IT IS SO ORDERED.
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`SIGNED this 18th day of July, 2017.
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`_____________________________
`WILLIAM C. BRYSON
`UNITED STATES CIRCUIT JUDGE
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`5 In its reply brief, UroPep cites the Federal Circuit’s non-precedential opinion in Deere
`& Co. v. Duroc LLC, 650 F. App’x 779, 782 (Fed. Cir. 2016), which upheld a decision by a
`district court in Iowa that awarded costs for “trial technology specialists and demonstrative
`exhibits.” It is not clear from the papers in that case whether the “demonstrative exhibits” were
`actual exhibits at trial or merely demonstratives that were used at trial without being introduced
`into evidence. In any event, Eighth Circuit law, not Fifth Circuit law, governed the award of
`costs in that case, and the appellee cited Eighth Circuit law that adopted a broad reading of the
`term “exemplification” in section 1920, as opposed to the narrow reading of that term applied in
`the Fifth Circuit. See Brief of Defendants-Appellees Alamo Group Inc. and Bush Hog, Inc.,
`Deere & Co. v. Duroc LLC, No. 2014-1697, 2015 WL 1396709, at *29 (Fed. Cir., filed Mar. 17,
`2015) (citing Marmo v. Tyson Fresh Meats, Inc., 457 F.3d 748, 763 (8th Cir. 2006) (awarding
`costs for “materials prepared for trial in this action—such as graphic and visual aids, as well as
`materials prepared for electronic display”)).
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`10
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