Motions for Cost-Shifting for Federal Subpoena Compliance

Motions for Cost-Shifting for Federal Subpoena Compliance

Getting hit with a federal subpoena can be a real pain, I feel you. Having to dig through piles of documents or put your business operations on hold to comply takes time and money. And if you’re not even a party to the lawsuit, it probably feels pretty unfair to have to foot the bill just because someone decided they want your information. Luckily, there are options to make the party who served you pay up through “cost-shifting” motions. I’ll walk through what these are, how they work, and when you can file one.

What is Cost-Shifting?

Cost-shifting is exactly what it sounds like – shifting the costs of complying with a subpoena from the non-party recipient (that’s you) to the party who issued it. These costs can include things like collecting, reviewing, and producing documents, or travel expenses for deposition testimony. The court can order the requesting party to pay some or all of these costs so you’re not stuck holding the bag.

How Cost-Shifting Motions Work

Federal Rule of Civil Procedure 45 allows non-parties to file motions to shift costs. Here’s a quick rundown of how it works:

• File a motion in the court where compliance is required or the court that issued the subpoena (check local rules!).
• Explain why complying would be an “undue burden or expense.” Think volume of documents, disruption to operations, etc.
• Ask the court to order the requesting party to pay all or part of your reasonable compliance costs.
• If granted, the requesting party has to pay up before you fully comply.

Courts don’t rubber stamp these motions – you need to show real burden or expense. But many courts have said cost shifting is mandatory when compliance costs are “significant.” So don’t be shy about asking for help with the bill!

When Can You File for Cost-Shifting?

You need to file your motion before the subpoena’s compliance deadline. Don’t wait until after you’ve already turned everything over, or the court will say too bad, so sad. Here are some common scenarios:

• Subpoena demands unreasonable volume of documents – File a motion to shift costs of production.
• Subpoena requires expert analysis or review – File a motion to shift expert fees.
• Subpoena demands onsite inspection – File a motion to shift travel costs.
• Subpoena causes major business interruption – File a motion to shift costs of business loss.

Get creative and don’t be shy – the more unreasonable the subpoena seems, the better your case for cost-shifting. And don’t let the requestor bully you into compliance by saying you “have to” comply before the court rules – file that motion first!

What Costs Can You Recover?

You can potentially recover costs that are directly related to subpoena compliance, such as:

• Collection costs – Gathering, processing, searching, reviewing documents
• Production costs – Duplication, data processing, etc.
• Legal fees – Consulting a lawyer about compliance
• Expert fees – Paying an expert to analyze information
• Business interruption – Employees pulled away from normal work
• Travel expenses – Airfare, lodging, transportation, meals

Courts scrutinize the reasonableness of claimed costs, so keep detailed records and be prepared to justify the expenses. You probably won’t recover 100% of costs – the goal is to reduce the burden to a “non-significant” level.

How Much Can You Recover?

The amount of cost-shifting varies wildly between courts. Some courts shift just a token amount like 10-20%, while others order 100% reimbursement. Factors courts may consider include:

• Total cost of compliance vs. subpoenaing party’s resources
• Whether you have an interest in the lawsuit
• Your relationship to the parties
• Whether compliance benefits you in any way
• Amount in controversy in the case

Bottom line – the more unreasonable and burdensome the subpoena seems, the better your case for a large cost shift. Don’t be shy about asking for 100% reimbursement if you can show significant burden or expense.

What if the Subpoena is Overly Broad?

Sometimes you can avoid cost-shifting motions altogether by negotiating the scope of the subpoena. If it asks for way more than seems relevant to the case, push back. Offer to produce a smaller set of documents or data if they’ll withdraw the subpoena. Get any agreements in writing!

You can also file a motion to quash or modify the subpoena if it’s overly broad. This asks the court to toss out or narrow the subpoena before you have to comply. The court may be more willing to do this if you can show the subpoena imposes undue burden or expense.

Can You Recover Costs of Your Motion?

This is a tricky one – some courts allow recovery of reasonable costs spent on your motion, like attorney’s fees. But some courts hold that only the actual compliance costs can be shifted. Better to focus your motion on recouping compliance costs rather than motion costs.

What if They Don’t Pay?

If the court grants your cost-shifting motion but the requesting party doesn’t pay up, you may be able to get the court to hold them in contempt or impose sanctions. But you’ll probably need to file another motion to enforce the cost-shifting order. Don’t count on getting blood from a stone – the party may not have the money.

Before it gets to that point, try negotiating payment plans or installment schedules if they can’t pay the full amount up front. Get any payment agreements in writing and approved by the court to avoid enforcement issues later. Don’t let it drag on forever without payment – follow up promptly with the court if there are issues.

Subpoena Cost-Shifting Tips

Here are my top tips for getting those pesky subpoena costs shifted:

• Act fast – file your motion before the compliance deadline.
• Keep meticulous records of compliance costs to justify the amount.
• Hire a lawyer to improve your chances of a favorable ruling.
• Emphasize any business disruption or expert help needed.
• Negotiate payment plans if they can’t pay lump sum.
• Follow up promptly if they don’t pay as agreed.

Dealing with subpoenas is a pain, but you shouldn’t have to go broke complying with one aimed at someone else’s lawsuit. Don’t let them stick you with the bill – get those costs shifted! Let me know if you have any other questions.

References

[1] Motions for Cost-Shifting for Federal Subpoena Compliance

[2] Cost-Shifting and Document Subpoena Compliance Under the Federal Rules of Civil Procedure and the Rules of the Supreme Court of Virginia

[3] Recovering the Costs of Responding to a Nonparty Subpoena

[4] Shifting Costs for Responding to Subpoenas Under FRCP 45

[5] Fresh Takes on Seeking Costs and Fees Under Rule 45

[6] Mandatory Cost-Shifting for Compliance With Nonparty Subpoenas?