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L.A. Printex Industries, Inc. v. William Carter Co.

December 1, 2010

L.A. PRINTEX INDUSTRIES, INC.
v.
WILLIAM CARTER CO., ET AL.



The opinion of the court was delivered by: Honorable John F. Walter, United States District Judge

PRIORITY SEND

JS-6

CIVIL MINUTES -- GENERAL

S. Eagle Courtroom Deputy None Present Court Reporter

ATTORNEYS PRESENT FOR PLAINTIFFS: ATTORNEYS PRESENT FOR DEFENDANTS: None None

PROCEEDINGS (IN CHAMBERS): ORDER GRANTING DEFENDANT MS. BUBBLES, INC.

Factual and Procedural History

ATTORNEY'S FEES IN THE AMOUNT OF $217,556.50; and ORDER GRANTING DEFENDANT AEROPOSTALE, INC. ATTORNEY'S FEES IN THE AMOUNT OF $198,888.56

On July 16, 2010, Defendants Ms. Bubbles, Inc. ("Ms. Bubbles") and Aeropostale, Inc. ("Aeropostale") (collectively, "Defendants") filed a Motion for Attorneys' Fees and Costs ("Motion"). On July 26, 2010, Plaintiff L.A. Printex Industries, Inc. ("Plaintiff") filed its Opposition. On August 2, 2010, Defendants filed a Reply. On August 10, 2010, the Court issued an order granting Defendants' Motion, and ordered the parties to meet and confer to resolve any disputes regarding the amount of reasonable attorney's fees that should be awarded to Defendants, and submit a joint statement to the Court if they could not resolve their disputes. The parties failed to reach an agreement during the meet and confer process, and on August 31, 2010, they filed their Joint Statement Re: Defendants' Attorneys' Fees ("Joint Report"). The Joint Report failed to include the description, or narrative, for each of the disputed entries, which was specifically required by the Court's August 10, 2010 Order granting Defendants attorneys' fees. On September 21, 2010, the Court ordered the parties to file an amended Joint Statement with a summary table in the format shown in Exhibit A to the September 21, 2010 Order. On October 12, 2010, after the Court granted an extension of time to file the amended Joint Report, the parties filed their Revised Joint Statement Re: Defendants' Attorneys' Fees ("Revised Joint Report").

Discussion

In this case, the parties were unable to reach any agreements during the meet and confer process, and, therefore, the Court must determine the amount of attorney's fees that should be awarded to Defendants. "The 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." Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). This equation is commonly referred to as the "lodestar." See, Welch v. Metropolitan Life Ins. Co., 480 F.3d 942, 945 (9th Cir. 2007). The prevailing rate in the community is indicative of the reasonable hourly rate for purposes of calculating attorney's fees using the lodestar method. Jordan v. Multnomah, 815 F.2d 1258, 1263 (9th Cir. 1987). The fee applicant has the burden of producing satisfactory evidence, in addition to the affidavits of its counsel, that the requested rates are in line with those prevailing in the community for similar services of lawyers of reasonably comparable skill and reputation. Blum v. Stenson, 465 U.S. 886, 895, n.11 (1984). The fee applicant also "bears the burden of documenting the appropriate hours expended in the litigation and must submit evidence in support of those hours worked." Gates v. Deukmejian, 987 F.2d 1392, 1397 (9th Cir. 1992). "In determining the appropriate lodestar amount, the district court may exclude from the fee request any hours that are 'excessive, redundant, or otherwise unnecessary.'" Welch, 480 F.3d at 946 (quoting Hensley, 461 U.S. at 433). In making its reasonableness determination, the district court has considerable discretion to adjust the lodestar upward or downward on the basis of the twelve factors set forth in Kerr v. Screen Guild Extras, Inc., 526 F.2d 67, 70 (9th Cir. 1975), cert., 425 U.S. 951 (1976), some of which are subsumed into the initial lodestar calculation.*fn1

v. City of San Rafael, 96 F.3d 359, 364 (9th Cir. 1996). In addition, "[i]f opposing counsel cannot come up with specific reasons for reducing the fee request that the district court finds persuasive, it should normally grant the award in full, or with no more than a haircut." Moreno v. City of Sacramento, 534 F.3d 1106, 1116 (9th Cir. 2008).

A. The Hourly Rates Requested By Counsel for Defendants Are Reasonable.

Ms. Bubbles seeks fees for work performed by its attorneys, Lewis Brisbois Bisgaard & Smith LLP ("LBBS"), and Lacey Dunn & Do ("LDD"). Aeropostale seeks fees for work performed by its attorneys, Katten Muchin Rosenman LLP ("KMR"). Plaintiff does not dispute the reasonableness of the hourly rates charged by the attorneys representing Ms. Bubbles at LBBS or *fn2 However, Plaintiff does dispute the reasonableness of the hourly rates charged by the attorneys at KMR representing Aeropostale.

The hourly rates for the attorneys at KMR that billed time to this action are as follows*fn3 : (1) Karen Artz Ash, whose billing rate was $715.50 per hour in 2009 and $738 per hour in 2010; (2) Jay Shapiro, whose billing rate was $544.50 per hour in 2009 and $562.50 in 2010; (3) Zia F. Modabber, whose billing rate was $544.50 per hour in 2009 and $562.50 per hour in 2010; (4) Bret J. Danow, whose billing rate was $495 per hour in 2009*fn4 ; (5) Keely L. Herrick, whose billing rate was $477 per hour in 2009*fn5 ; (6) Cory Baskin, whose billing rate was $346.50 per hour in 2009 and $396 per hour in 2010; and (7) Kristin L. Holland, whose billing rate was $450 per hour in 2009 and $463.50 per hour in 2010.*fn6 In addition the hourly rates for the paralegals at KMR that billed time to this action are as follows: (1) Vasiliki Plevritis, whose billing rate was $198 per hour in 2009 and $202.50 in 2010; and (2) Georgia Saltsman, whose billing rate is $229.50 in 2010.*fn7

In her declaration, Ms. Holland details the experience and reputation of each attorney, which supports the hourly rates charged by those attorneys. Ms. Ash, who is a partner at KMR and the national co-chair of its Intellectual Property Practice Group, has been practicing in the intellectual property field for approximately 30 years. Ms. Ash has authored over 50 articles, including articles published in The Patent and Trademark Copyright Journal and Managing Intellectual Property, and was selected by Forbes.com as a "Best Lawyer in America" (IP) in 2005. Mr. Shapiro, who is a partner at KMR and a member of its Insurance and Risk Management, Litigation and Dispute Resolution and White Collar Criminal and Civil Litigation and Compliance Practice Groups, has been an attorney for approximately 30 years, and has tried over 35 cases in state and federal court, including intellectual property disputes. In fact, Mr. Shapiro has represented Aeropostale in numerous trademark and copyright matters. Mr. Shapiro has written and co-authored numerous publications, including Moore's Federal Practice, 3d Ed., Summary Judgment (Matthew Bender), and has been an Adjunct Professor of Law at New York Law School since 1989. Mr. Modabber, who is a partner at KMR and Chair of its Los Angeles Litigation and Dispute Resolution Practice, has been an attorney for approximately 22 years. Mr. Modabber is an experienced trial lawyer, and has been recognized nationally as one of the best lawyers in the country. Mr. Danow, who is a partner at KMR and a member of its Intellectual Property Practice, has been an attorney for approximately 20 years. Ms. Herrick, who is an associate at KMR, has been an attorney for approximately eight years, and her practice focuses on intellectual property law. Mr. Baskin, who is an associate at KMR and a member of its Litigation and Dispute Resolution Department, has been an attorney for approximately 5 years and his practice focuses on all aspects of business litigation. Ms. Holland, who is a partner at KMR and a member of its Intellectual Property Litigation Department, has litigated intellectual property disputes for 14 years. Ms. Holland has spoken extensively on intellectual property issues, and serves as the Chair of the Outside Counsel Advisory Board of the Association of Media and Entertainment Counsel.

In addition to their extensive experience, the KMR attorney's hourly rates are reasonable when compared to the prevailing rates charged in Los Angeles "for similar services of lawyers with reasonably comparable skill, experience, and reputation." Blum, 465 U.S. at 895. For example, the American Intellectual Property Law Association ("AIPLA") Survey, Report of the Economic Survey 2007 and the National Law Journal's 2008 Billing Survey, reveal that the rates charged by KMR in this action are below the average rates charged by large national firms with offices in Los Angeles, such as Sheppard, Mullin, Richter & Hampton and Manatt, Phelps & Phillips.*fn8 In addition, courts in this district have found that rates ranging from $690 per hour for a senior partner to $305 per hour for a junior associate in 2006 charged by Manatt, Phelps & Phillips in a copyright case were "consistent with the rates typically charged by other highly-regarded southern California law firms for similar work for attorneys of comparable experience." Love v. Mail on Sunday, 2007 WL 2709975, *8 (C.D Cal. Sept. 7, 2007).

Based on a comparison of the expertise, experience, and reputation of the KMR attorneys in intellectual property law with the hourly rates charged by comparable law firms, the Court finds that the rates charged by the KMR attorneys are reasonable. Accordingly, the Court finds that Aeropostale has produced satisfactory evidence that the rates requested by its counsel are in-line with prevailing rates in the community. See United Steelworkers of America v. Phelps Dodge, 896 F.2d 403, 407 (9th Cir. 1990) (holding that "[a]ffidavits of the plaintiffs' attorney and other attorneys regarding prevailing fees in the community and rate determinations in other cases, particularly setting a rate for the plaintiffs' attorney, are satisfactory evidence of the prevailing market rate").

While Plaintiff offers no evidence that the KMR attorneys' hourly rates are unreasonable, it nonetheless argues that the hourly rates requested by Aeropostale are grossly inflated and excessive. However, Plaintiff's naked assertion that Aeropostale has not met its burden of demonstrating the reasonableness of the KMR attorneys' hourly rates is insufficient to rebut the evidence submitted by Aeropostale.*fn9 See, United Steelworkers, 896 F.2d at 407 (holding that the district court must assume that the rates established by the plaintiffs' evidence are reasonable where "[a]lthough the defendants disagreed with this evidence, they did not support their arguments with any affidavits or evidence of their own regarding the legal rates in the community").

B. The Majority of Hours Billed by Defendants' Counsel Are Reasonable.

1. The Majority of Hours Billed by Counsel for Ms. Bubbles Are Reasonable.

Ms. Bubbles requests an award of $218,366.50, which consists of $2,740.00 in fees billed by LDD, its former counsel, and $215,626.50 in fees billed by LBBS, its current counsel. In addition to the issues raised by Plaintiff in the Revised Joint Report, the Court has conducted its own independent review of the billing statements submitted by counsel for Ms. Bubbles and determined, with certain exceptions discussed herein, that the majority of hours billed are a. Ms. Bubbles Is Entitled to Attorney's Fees for the Hours Spent Preparing Documents Plaintiff Contends Were Prepared in L.A. Printex Industries, Inc. v. Aeropostale, Inc., CV 08-7085-DDP (Ex).

Plaintiff argues that Ms. Bubbles is not entitled to an award of attorney's fees for hours spent preparing documents, including pleadings, motions, and discovery requests and responses, that Plaintiff contends are virtually identical to those prepared by Ms. Bubbles in an earlier action, L.A. Printex Industries, Inc. v. Aeropostale, Inc., CV 08-7085-DDP (Ex) (the "Aeropostale action"). Plaintiff argues that both actions were simple copyright infringement actions, and, thus, the fees charged by counsel for Ms. Bubbles related to the preparation of these documents should be reduced by at least 75 percent.

Ms. Bubbles argues that a simple comparison of the questioned documents, including Ms. Bubbles' Answer, initial disclosures, requests for documents, interrogatories, and responses to requests for production of documents, reveal multiple substantive differences in the documents, which clearly demonstrate that the documents prepared in this case are the product of original work. In addition, Ms. Bubbles argues that the presence of different issues in each case necessitated the preparation of documents tailored to the issues in that case. For example, the issues in the Aeropostale action involved whether Plaintiff was allowed to copyright works that were allegedly derivative of artwork found on Adobe Photoshop and the validity of Plaintiff's purported published collective work copyright registration. In contrast, the issues in this action related to whether Plaintiff had ever submitted the textile design at issue to the Copyright Office and the validity of Plaintiff's allegedly unpublished collection.

The Court agrees with Ms. Bubbles. As the Ninth Circuit recently stated in Moreno v. City of , 534 F.3d 1106, 1112 (2008):

The court may reduce the number of hours awarded because the lawyer performed unnecessarily duplicative work, but determining whether work is unnecessarily duplicative is no easy task. When a case goes on for many years, a lot of legal work product will grow stale; a competent lawyer won't rely entirely on last year's, or even last month's research: Cases are decided; statutes are enacted; regulations are promulgated and amended. A lawyer also needs to get up to speed with the research previously performed. All of this is duplication, of course, but it's necessary duplication; it is inherent in the process of litigating over time. . . . ...


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