Oxbow Carbon & Minerals LLC v. Union Pacific Railroad Company
322 F.R.D. 1
| D.D.C. | 2017Background
- Oxbow (five related companies) sues Union Pacific and BNSF for antitrust violations, alleging conspiratorial fuel-surcharge pricing and market allocation that caused >$50M in alleged overcharges and seeks treble damages.
- Defendants moved to compel production of documents from William I. Koch (Oxbow’s founder, CEO, principal owner) as an additional custodian, asserting Koch’s files contain unique, relevant information bearing on damages and causation.
- Oxbow sampled Koch’s files: vendor processed 467,614 documents, yielding 45,639 search-term hits (82,600 with families); a 10% random sample (12,074 docs) produced ~1,300 responsive documents (11.67% responsiveness). Sampling cost ~$57,198; Oxbow estimated full production would cost ~$85,000 more (total ~$142,000).
- Oxbow argued production would be unduly burdensome, duplicative, and not proportionate; alternatively sought cost-shifting to Defendants. Defendants argued the sample confirms unique, relevant documents and proportionate discovery given millions at stake.
- Magistrate Judge G. Michael Harvey weighed the Rule 26(b)(1) proportionality factors, found Koch’s files relevant and not unduly burdensome, denied cost-shifting, and ordered production of all unique, relevant documents from Koch within 30 days.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Oxbow must add Koch as a document custodian and produce remaining documents | Producing Koch’s remaining files is unduly burdensome, costly, and largely duplicative; sampling shows low responsiveness | Koch has unique, relevant documents; sampling confirms useful, non-duplicative material and search terms narrowed results | Court granted motion to compel: Oxbow must produce all unique, relevant Koch documents |
| Proportionality of discovery under Rule 26(b)(1) | Burden/cost outweighs benefit; $85k–$142k to finish review is disproportionate | Amount in controversy, importance of issues, and unique access to information make discovery proportional | Court weighed six Rule 26 factors; concluded discovery is proportional given stakes and resources |
| Whether cost-shifting to Defendants is appropriate | If compelled, Defendants should bear some/all production costs | Discovery costs should be borne by producing party absent undue burden; no undue burden shown | Court denied cost-shifting; Oxbow must bear production costs |
| Whether further negotiation of search terms/sampling required before compelling production | Oxbow refused to re-negotiate (saying likely marginal savings) and declined to share sampling data for negotiation | Defendants offered to tailor terms based on sample; urged court oversight if parties can't resolve | Court found additional negotiation unlikely to be productive and ordered production without further delay |
Key Cases Cited
- Friedman v. Bache Halsey Stuart Shields, 738 F.2d 1336 (D.C. Cir. 1984) (broad scope of discovery under Rule 26)
- Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340 (1978) (presumption that responding party bears discovery costs)
- Zubulake v. UBS Warburg, LLC, 217 F.R.D. 309 (S.D.N.Y. 2003) (framework addressing cost-shifting in e-discovery)
- Equal Rights Ctr. v. Post Prop, Inc., 246 F.R.D. 29 (D.D.C. 2007) (movant bears initial burden to show incomplete discovery)
- Jewish War Veterans of the U.S. of Am. v. Gates, 506 F. Supp. 2d 30 (D.D.C. 2007) (party must explain relevance of requested discovery)
- D’Onofrio v. SFX Sports Group, Inc., 254 F.R.D. 129 (D.D.C. 2008) (cost-shifting standard and presumption against shifting)
- Peskoff v. Faber, 251 F.R.D. 59 (D.D.C. 2008) (cost-shifting discussion in discovery disputes)
- Labrier v. State Farm Fire & Cas. Co., 314 F.R.D. 637 (W.D. Mo. 2016) (importance of discovery tied to core issues of litigation)