Erickson Productions Inc. v. Kast

          ORDER DENYING WITHOUT PREJUDICE PLAINTIFFS' MOTION FOR ATTORNEY'S FEES AND COSTS RE: DKT. NO. 108

          HOWARD R. LLOYD UNITED STATES MAGISTRATE JUDGE.

         Jim Erickson is a professional photographer who makes his living by licensing his photographs through his company, Erickson Productions, Inc. Mr. Erickson and Erickson Productions, Inc. will be referred to collectively here as “Erickson.”

         Erickson sued Kraig R. Kast for copyright infringement, claiming that he copied several of Erickson’s photos and used them without permission on the website for Kast’s business, Atherton Trust. Erickson asserted claims for direct copyright infringement, as well as for contributory and vicarious copyright infringement. Kast did not dispute that Erickson’s photos were contained on a version of Atherton Trust’s website. However, he maintained that the photos were merely “placeholders” for the licensed photos that he ultimately intended to include on the site. His chief contention was that the Atherton Trust website was designed by a third-party, Only Websites, Inc. (Only Websites), and that he had no knowledge of or control over any infringing use of Erickson’s photos.

         Most of Kast’s affirmative defenses were disposed of, either on Erickson’s motion to strike or their subsequent motion for summary judgment. However, Kast’s “Innocent Infringement” defense was allowed to stand to the extent that his mental state pertained to the issue of remedies.

         Following a three-day trial, ^[1] the jury rendered a verdict for Erickson as to each of the photos in question. Although the jury did not find that Kast directly infringed the photos, they determined that he was liable for vicarious and contributory infringement and, further, that the infringement was willful. The jury awarded Erickson the maximum $450, 000 in statutory damages, and judgment was entered accordingly. The matter is on appeal.^[2]

         Pursuant to 17 U.S.C. § 505, Erickson moves for an award of attorney’s fees. Kast opposes the motion. No one requested a hearing on this matter, and the court finds that no oral argument is necessary. Civ. L.R. 7-1(b). Upon consideration of the moving and responding papers, this court denies the motion without prejudice.

         DISCUSSION

         Section 505 of the Copyright Act permits a district court to “award a reasonable attorney’s fee to the prevailing party as part of the costs.” 17 U.S.C. § 505.^[3] An award of attorney’s fees is a matter of the court’s discretion. Fogerty v. Fantasy, Inc., 510 U.S. 517, 533 (1994). And, Section 505 “grants courts wide latitude to award attorney’s fees based on the totality of circumstances in a case.” Kirtsaeng v. John Wiley & Sons, Inc., 136 S.Ct. 1979, 1985 (2016). “‘In deciding whether to award fees under the Copyright Act, the district court should consider, among other things: the degree of success obtained on the claim; frivolousness; motivation; objective reasonableness of factual and legal arguments; and need for compensation and deterrence.’” VMG Salsoul, LLC v. Ciccone, ___F.3d ___, Nos. 13-57104, 14-55837, 2016 WL 3090780, at *13 (9th Cir., June 2, 2016) (quoting Maljack Prods., Inc. v. GoodTimes Home Video Corp., 81 F.3d 881, 889 (9th Cir. 1996)). Courts in the Ninth Circuit also consider “whether the chilling effect of attorney’s fees may be too great or impose an inequitable burden on an impecunious plaintiff.” Ets-Hokin v. Skyy Spirits, Inc., 323 F.3d 763, 766 (9th Cir. 2003).

         Additionally, courts should give substantial weight to the objective reasonableness of the losing party’s position. Kirtsaeng, 136 S.Ct. at 1983. Nevertheless, “objective reasonableness can be only an important factor in assessing fee applications---not the controlling one.” Id. at 1988. “That means in any given case a court may award fees even though the losing party offered reasonable arguments (or, conversely, deny fees even though the losing party made unreasonable ones).” Id. “Although objective reasonableness carries significant weight, courts must view all the circumstances of a case on their own terms, in light of the Copyright Act’s essential goals.” Id. at 1989.

         These guideposts may be used “so long as such factors are faithful to the purposes of the Copyright Act and are applied to prevailing plaintiffs and defendants in an evenhanded manner.” Fogerty, 517 U.S. at 534 n.19. “Faithfulness to the purposes of the Copyright Act is, therefore, the pivotal criterion.” Fantasy, Inc. v. Fogerty, 94 F.3d 553, 558 (9th Cir. 1996). “The primary objective of the Copyright Act is to encourage the production of original literary, artistic, and musical expression for the good of the public.” Fogerty, 510 U.S. at 524.

         The degree of success obtained on the claim

         Although Erickson did not succeed on the direct infringement theory, the jury found in Erickson’s favor on the vicarious and contributory infringement claims, concluded that the infringement was willful, and awarded the maximum statutory damages. Erickson therefore obtained substantial success. Moreover, while willful infringement, in itself, does not compel an award of fees, it is an important factor favoring such an award. Historical Research v. Cabral, 80 F.3d 377, 379 (9th Cir. 1996).

         Frivolousness; motivation; objective reasonableness of factual and legal arguments

         There was no dispute that Erickson is the owner of valid copyrights in the subject photos and that the photos were used without permission on Kast’s website. Erickson’s claims therefore were not frivolous, and this court finds no evidence that this lawsuit was motivated by bad faith. Nor was Erickson’s infringement claim objectively unreasonable. This court denied both sides’ motions for summary judgment re infringement, finding that there were materially disputed facts sufficient to permit that issue to proceed to a jury. See VMG Salsoul, LLC, ___F.3d___, 2016 WL 3090780, at *13 (“If a plaintiff has a claim ...