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Mike Vaughn Custom Sports, Inc. v. Piku

United States District Court, E.D. Michigan, Southern Division

July 30, 2015

MIKE VAUGHN CUSTOM SPORTS, INC., Plaintiff,
v.
CHRYSTEM

OPINION AND ORDER GRANTING IN PART PLAINTIFF'S MOTION FOR ATTORNEY'S FEES

DAVID M. LAWSON, District Judge.

This matter is before the Court on the plaintiff's motion for attorney's fees after prevailing at trial on its claim for false designation of origin and four of the five state law claims presented to the jury. The Court previously determined that this was an exceptional case that entitled the plaintiff to attorney's fees under 15 U.S.C. § 1117(a), but ordered counsel for the plaintiff to submit a supplemental brief that explicitly identified the hours spent litigating the successful claim under the Lanham Act, which is the only claim for which attorney's fees could be recovered in this case. The plaintiff has submitted a supplemental brief that includes 150 pages of billing records in support of its request. Those records identify only one entry describing counsel's efforts to prosecute the false-designation-of-origin claim.

In its complaint, the plaintiff initially identified four claims based on the Lanham Act: trade dress infringement (count I), trademark dilution and false promotion of goods (count II), false designation of origin (count III), and trade dress dilution (count IV). However, three of those counts were dismissed before trial on motion. The amended complaint also set out ten state law claims. Therefore, only one of the fourteen original claims permits an award of attorney's fees.

The Court is not able to determine with any degree of precision - or even generally - the amount of time spent by counsel on the claim for which attorney's fees can be awarded. But based on the "overall sense of [the] suit, " the records that have been submitted, the observation of the trial (including work performed with witnesses who eventually were disallowed), and attempting "to do rough justice, " Fox v. Nice, ___ U.S. ___, 131 S.Ct. 2205, 2216 (2011), the Court finds that 15 percent of the time expended by plaintiff's counsel can be attributed fairly to the federal claim for which fees may be shifted. Applying the lodestar method, that translates to $121, 630.50, which is awarded to the plaintiff against the defendants jointly and severally.

I.

On September 10, 2014, a jury returned a verdict in favor of plaintiff Mike Vaughn Custom Sports, Inc. on its surviving claim under the Lanham Act, 15 U.S.C. § 1125(a), and four of its five state law claims. Total damages were awarded in the amount of $322, 200 against the defendants. Thereafter, the plaintiff filed a motion seeking nearly $1 million in attorney's fees and expenses - more than three times the amount of the damages awarded. The Court heard oral argument on the attorney's fee motion on May 19, 2015, and announced its decision from the bench. The Court found that the case was an "exceptional" case that qualified for attorney fees under 15 U.S.C. § 1117(a) because of the defendants' unreasonable conduct in the litigation and efforts to pass off the plaintiff's products as their own. See Johnson v. Jones, 149 F.3d 494, 503 (6th Cir. 1998) (finding that it "could not agree more" that a case is generally exceptional if a defendant "pass[ed] off a product or service as another seller's better established one, or some other deliberate theft of a marketholder's goodwill.").

The Court could not determine the amount of those fees, however, because the plaintiff failed to identify and apportion the time that counsel spent litigating its claim under the Lanham Act, the only claim for which counsel was entitled to attorney's fees. See U.S. Structures, Inc. v. J.P. Structures, Inc., 130 F.3d 1185, 1193 (6th Cir. 1997) ("[U]nder 15 U.S.C. § 1117(a), attorneys' fees are recoverable only for work performed in connection with claims filed under the Lanham Act."). Therefore, the Court ordered the plaintiff to submit a supplemental brief in support of its fee request. The plaintiff has submitted a supplemental brief, reducing its request to $825, 892.50, and attached over 150 pages of billing records. But those records do not identify the hours the plaintiff spent litigating its false-designation-of-origin claim. The defendants have filed responses objecting to the amount requested. The Court has reviewed the parties' submissions and, for the reasons that follow, will reduce the plaintiff's award to $121, 630.50.

II.

A.

In determining a "reasonable" fee under section 1117(a), the Court must first determine the "lodestar" amount (the product of multiplying the number of hours reasonably expended on the litigation by a reasonable hourly fee) and then reduce or augment that amount by considering other case-specific factors. Hensely v. Eckerhart, 461 U.S. 424, 433-37 (1983) (noting that "[t]he most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate"). "The party seeking attorney's fees bears the burden of establishing entitlement to an award and documenting the appropriate hours expended and hourly rates.'" Yellowbook Inc. v. Brandeberry, 708 F.3d 837, 848 (6th Cir. 2013) (quoting Hensley, 461 U.S. at 437). "The key requirement for an award of attorney's fees is that the documentation offered in support of the hours charged must be of sufficient detail and probative value to enable the court to determine with a high degree of certainty that such hours were actually and reasonably expended in the prosecution of the litigation." Inwalle v. Reliance Med. Prodcus., Inc., 515 F.3d 531, 553 (6th Cir. 2008). The trial judge must "question the time, expertise, and professional work of [the] lawyer" applying for fees. Earl v. Beaulieu, 620 F.2d 101, 103 (5th Cir. 1980). And, in calculating the appropriate award, "the district court is required to give a clear explanation, " as to its reasoning. Moore v. Freeman, 355 F.3d 558, 566 (6th Cir. 2004).

However, "trial courts need not, and indeed should not, become green-eyeshade accountants." Fox, 131 S.Ct. at 2216. "The essential goal in shifting fees (to either party) is to do rough justice, not to achieve auditing perfection." Ibid. "So trial courts may take into account their overall sense of a suit, and may use estimates in calculating and allocating an attorney's time." Ibid. Thus, "there is no requirement... that district courts identify and justify each disallowed hour." Mares v. Credit Bureau of Raton, 801 F.2d 1197, 1202 (10th Cir. 1986) (citing New York State Association for Retarded Children v. Carey, 711 F.2d 1136, 1146 (2d Cir. 1983)). "Nor is there any requirement that district courts announce what hours are permitted for each legal task." Ibid. Instead, the Supreme Court has held that "a concise but clear explanation" of a district court's reasons for a fee award, Hensley, 461 U.S. at 437, may include findings of "unnecessary, unreasonable or unproductive time, " that "the time spent on the particular activity was excessive, '" or that a less amount of time was "reasonable, " see Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 554 n.2, 566-67 (1986).

Counsel for the plaintiff originally requested the Court to award $991, 103.50 in attorney's fees for 3, 235 hours of work. Plaintiff's attorney Brian Renaud, reduced his request to $825, 892.50 for 2, 685 hours of work after the Court ordered him to limit it to the hours spent litigating the plaintiff's sole successful claim under the Lanham Act. Counsel for the plaintiff now represents that he spent more than 83 percent of his time on the claim for false designation of origin even though it is only one of the 14 claims in the amended complaint. However, the supporting documents - consisting of more than 150 pages of invoices - do not support Mr. Renaud's assertion. Instead, the invoices suggest that most of the time was spent on all of the claims in general, and much time was devoted to the state law claims and the dismissed federal claims. "Under 15 U.S.C. § 1117(a), attorneys' fees are recoverable only for work performed in connection with claims filed under the Lanham Act." U.S. Structures, 130 F.3d at 1193. The Court may award fees for non-Lanham Act claims, but only if "the claims are so inextricably intertwined that even an estimated adjustment would be meaningless." Gracie v. Gracie, 217 F.3d 1060, 1070 (9th Cir. 2000).

Mr. Renaud does not argue that it was impossible to apportion the hours spent on each claim. Nor could he, since many of the billing records do just that. See, e.g., 1/10/2012 ("Prepare for and meet with client regarding trade secrets misappropriation claims"); 1/11/2012 ("Evaluate U.S. federal cases regarding current status of trade dress law and basis for claims of design violations."); 02/09/12 ("Further evaluation of trade dress claims"); 02/28/12 ("Meeting to discuss Vaughn litigation strategy and evaluate Lanham Act trade dress facts and legal issues"). But, after thoroughly reviewing the billing records, the Court could locate only one entry specifically describing his efforts to prosecute the false-designation-of-origin claim. See 07/31/12 ("Examine trade dress cases for pleadings and 18 USC 1125 for false designation and unfair competition."). Curiously, the plaintiff does not seek compensation for that entry (based on the highlighted submissions). Instead, Mr. Renaud seeks compensation for general time spent "review[ing] [a] deposition transcript in preparation for hearing, " a "telephone conference and correspondence with client, " and "attention to expert witness retention and deposition preparation matters, " among other activities, without specifying whether or how those activities relate to the claim under the Lanham Act. See, e.g., 4/12/13, 4/17/13, 5/6/2013.

Much of the plaintiff's billing records are unacceptably vague. A court may make deductions to the requested attorney fees if "[t]he time records maintained by the attorneys... [make] no mention... of the subject matter of a meeting, telephone conference or the work performed during hours billed.'" Fabi Const. Co., Inc. v. Secretary of Labor, 541 F.3d 407, 411 (D.C. Cir. 2008) (quoting In re Meese, 907 F.2d 1192, 1204 (D.C. Cir. 1990)). The plaintiff's billing records contain numerous entries for telephone conferences, discovery matters, and correspondence with experts that do not specify whether they concerned the false-designation-of-origin claim. See, e.g., 7/26/12 ("Work on discovery materials and agenda"); 1/29/13 ("Review discovery issues"); 1/31/13 ("Prepare correspondence with client"); 02/17/14 ("Attention to court filings"); 03/05/14 ("Correspondence and conference call with client"); 3/14/13 ("Review discovery strategies"); 03/21/14 ("Attention to trial preparation matters"); 4/28/14 ("Conference with Brian Renaud and Mike Blum"); 4/29/14 ("Attend meeting with Mike Vaughn"); 07/01/14 ("Receipt of emails from and to Weintraub"); 07/25/14 ("Conduct expert witness preparation session"); 07/30/14 ("Attend meeting with client"). The Court cannot determine from these and other records whether counsel's activities were focused on the only claim for which the ...


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