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Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340 (1978) (full-text).
Factual Background Edit
The plaintiff brought a class action suit against the defendant for recovery of the amount paid by the plaintiff class for fund shares that were artificially inflated in excess of their true value. The plaintiff sought defendant's assistance in compiling a list of class members so that the required individual notice could be sent. The district court held, and the Second Circuit affirmed, that compiling such a list was the defendant's responsibility, and it had to bear the entire cost of the process.
U.S. Supreme Court Proceedings Edit
The U.S. Supreme Court held that the district court was empowered to direct the defendant to compile such a list but, while some discretion existed for allocating the costs of this process, that discretion was abused in this case.
Plaintiff urged that the defendant bear all costs of compilation. He argued that, since the defendant put the class list on magnetic tape, it should be required to bear the burden of retrieval. The plaintiff contended that otherwise, potential defendants would be encouraged to bury information deep within complex computer programs in order to escape scrutiny and discovery. Additionally, even absent such a motive, it would be a complex and expensive process for the plaintiff to retrieve such a list, whereas it would be simpler if another method of data recording had been used.
The Court first determined that there was no evidence of any ill-motive. Further, the Court found that data retrieval should be cheaper and easier, which is why there was a switch to computers in the first place. The Court held that the district court abused its discretion, and reversed and remanded the case.
- ↑ Fed. R. Civ. P. 23(c)(2).