United States District Court, S.D. California
ORDER DENYING DEFENDANT'S MOTION FOR ATTORNEY
FEES (ECF NO. 175)
Janis L. Sammartino United States District Judge.
before the Court is Defendant Daniel J. Schacht, Esq.'s
(“Schacht”) Motion for Attorney Fees.
(“MTN, ” ECF No. 175.) Also before the Court are
Plaintiff's Response in Opposition to Motion for Attorney
Fees (“Opp'n, ” ECF No. 184), as well as
Defendant's Reply in Response, (“Reply, ” ECF
No. 187), to Plaintiff's Opposition. The Court previously
found that Defendant was a prevailing defendant under the
anti-SLAPP statute. (“Previous Order, ” ECF No.
171.) The Court ordered the parties to file supplemental
briefing on whether California law allows Defendant to
recover attorney's fees. (Id. at 17,
After considering the parties' arguments and the law, the
Court rules as follows.
Previous Order contains a thorough and accurate recitation of
the procedural history and facts underlying Plaintiff's
complaint. (Previous Order 2-3.) As relevant here, Plaintiff
filed a 103-page, 473-paragraph FAC against dozens of
Defendants associated with Defendant Carlos Santana. (ECF No.
38.) The gravamen of Plaintiff's claims is that these
Defendants infringed his copyrights in several of
Plaintiff's works by exceeding the scope of the licenses
in those works. (See generally FAC.) Plaintiff filed
six claims against law firm Defendant Donahue Fitzgerald LLP
(“Donahue”) and Daniel J. Schacht, a partner at
Donahue, (collectively “Attorney Defendants, ”
ECF No. 175-3, Schacht Decl. ¶ 1). These included four
federal claims: (1) copyright infringement under 17 U.S.C.
§ 501; (see, e.g., id. ¶ 200-01),
(2) contributory copyright infringement; (id. ¶
407), (3) vicarious copyright infringement; (id.
¶ 415), (4) inducing copyright infringement;
(id. ¶ 423), as well as two state law claims:
unfair business practices; (id. ¶ 463), and
constructive trust, (id. ¶ 471). Generally,
Plaintiff alleges that Defendant Donahue is the registrant,
administrator, and technical operator for two websites
(www.santana.com and www.carlossanta.com)
that contained infringing material. (Id. ¶
137.) Schacht is the point of contact for those two websites
and is the signatory to federal two trademark applications
and registrations that contain Plaintiff's designs.
(Id. ¶¶ 139-40.)
March 17, 2017, Attorney Defendants Donahue and Schacht filed
a special motion to strike the California state law claims
pursuant to California's anti-SLAPP statute. (ECF No.
77.) On April 13, 2017, Plaintiff voluntarily dismissed both
Defendants Donahue and Schacht from the action. (ECF No.
130.) In deciding the anti-SLAPP motion, the Court determined
that it had jurisdiction to determine Attorney
Defendants' motion on the merits and found that they were
“prevailing defendants” under California Code of
Civil Procedure § 425.16(a). (ECF No. 171.) The Court
also found, however, that because both Attorney Defendants
were attorney litigants and, potentially representing
themselves, supplemental briefing was needed to determine
whether Attorney Defendants could recover attorney's
fees. (Previous Order 19-20.) Only Defendant Schacht, not
Defendant Donahue, filed a renewed request for attorney's
fees in the amount of $58, 263.30. (ECF No. 175, at 2.)
anti-Strategic Lawsuit Against Public Participation
(“anti-SLAPP”) statute provides redress for those
hauled into court “primarily to chill the valid
exercise of the constitutional rights of freedom of speech
and petition for the redress of grievances.” Cal. Civ.
Proc. Code § 425.16(a). Specifically, the statute
provides a special motion to strike which may entitle
successful movants to attorneys' fees and costs.
Id. §§ 425.16(b), (c)(1).
“California's anti-SLAPP statute allows a defendant
to move to strike a plaintiff's complaint if it
‘aris[es] from any act of that person in furtherance of
the person's right of petition or free speech under the
United States or California Constitution in connection with a
public issue.'” Vess v. Ciba-Geigy Corp.
USA, 317 F.3d 1097, 1109 (9th Cir. 2003) (quoting Cal.
Civ. Proc. Code § 425.16(b)(1)). “The California
legislature has instructed that the statute should be
‘construed broadly.'” Id. (quoting
Cal. Civ. Proc. Code § 425.16(a)). Furthermore,
anti-SLAPP motions can be raised in federal court to target
state law claims. See, e.g., DC Comics v. Pac.
Pictures Corp., 706 F.3d 1009, 1013 n.5 (9th Cir. 2013)
(“We have held that [an anti-SLAPP] motion is available
against state law claims brought in federal court.”).
follows the American rule for attorney's fees; each party
to a lawsuit must ordinarily pay its own attorney's fees.
Trope v. Katz, 11 Cal.4th 274, 278 (1995). The
anti-SLAPP statute allows “a prevailing defendant on a
special motion to strike shall be entitled to recover his or
her attorney's fees and costs.” Cal. Civ. Proc.
Code § 425.16(c)(1).
Plaintiff's Request to Reconsider the Court's
Previous Order, the Court determined that Attorney Defendants
were “prevailing defendants” for the purposes of
the anti-SLAPP statute. (Previous Order 12.) Plaintiff asks
the Court to reconsider its ruling for a variety of reasons.
(See Opp'n 6- 10.) None are persuasive.
outset, the standard for reconsidering a previous ruling is
difficult to meet. “[A] motion for reconsideration
should not be granted, absent highly unusual circumstances,
unless the district court is presented with newly discovered
evidence, committed clear error, or if there is an
intervening change in the controlling law.” Carroll
v. Nakatani, 342 F.3d 934, 945 (9th Cir. 2003) (quoting
Kona Enters., Inc. v. Estate of Bishop, 229 F.3d
877, 890 (9th Cir. 2000)). A motion for reconsideration
“may not be used to raise arguments or present evidence
for the first time when they could reasonably have been
raised earlier in the litigation.” Id.
advances four arguments. First, Plaintiff argues that the
pending fee motion, not the previous anti-SLAPP Motion to
Strike, is the appropriate time to consider whether
anti-SLAPP applies at all. (Opp'n 6.) Plaintiff suggests
that because the Court previously denied as moot
Plaintiff's Motion to Strike, (ECF No. 158), and Attorney
Defendants' anti-SLAPP Motion to Strike, (ECF No. 77), he
should have a second attempt arguing the merits of the
anti-SLAPP motion. (Opp'n 6.) The Court may have denied
as moot Attorney Defendants' Motion, (Previous Order 6),
but it did so because Plaintiff voluntarily dismissed
Attorney Defendants, (id.), and after holding that
Attorney Defendants were “prevailing defendants”
under anti-SLAPP. (See Id. at 17.) The Court then
ordered Attorney Defendants to file their motion for
attorney's fees, (id. at 20). The fact that the
Court denied as moot Attorney Defendants' anti-SLAPP
Motion to Strike, on a procedural grounds, is no reason to
ignore the substance of the Previous Order.
Plaintiff contends California's anti-SLAPP law does not
apply in federal courts. (Opp'n 6-7.) Perhaps sensing the
futility of this argument, Plaintiff briefly cites Judge
Watford's dissent in Makaeff v. Trump Univ.,
LLC, 736 F.3d 1180 (9th Cir. 2013), voicing support for
a Ninth Circuit en banc panel to reconsider and reverse the
Circuit's “precedent permitting application of
state anti-SLAPP statutes in federal court.”
Id. at 1189-90 (Watford, J., dissenting from denial
of rehearing en banc). The Court previously determined
California's anti-SLAPP statute applies in federal court.
(Previous Order 9.) A dissenting opinion is neither
controlling on this Court, see, e.g., Hart v.
Massanari, 266 F.3d 1155, 1171 (9th Cir. 2001)
(“Once a panel resolves an issue in a precedential
opinion, the matter is deemed resolved, unless overruled by
the court itself sitting en banc, or by the Supreme
Court.”), nor any justification for departing from
controlling law. See, e.g., United States ex
rel. Newsham v. Lockheed Missiles & Space Co., 190
F.3d 963, 973 (9th Cir. 1999) (holding district court erred
in finding California's anti-SLAPP statute did not apply
in federal court).
Plaintiff asks the Court to find that the commercial speech
exception, found in section 425.17(c),  negates section
425.16. (Opp'n 7.) “The commercial speech exemption
[in section 425.17(c)] is a statutory exception to section
425.16 and should be narrowly construed.” JAMS,
Inc. v. Superior Court, 1 Cal.App. 5th 984, 992 (Ct.
App. 2016) (quoting Simpson Strong-Tie Co., Inc. v.
Gore, 49 Cal.4th 12, 22 (2010)
(“Simpson”)) (internal quotation marks
omitted). “[T]he party seeking the benefit of the
commercial speech exemption, [has] the burden of proof on
each element.” Id. (quoting L.A. Taxi
Cooperative, Inc. v. The Independent Taxi Owners Assn. of
L.A., 239 Cal.App.4th 918, 931 (Ct. App. 2015)
(alterations in original). The California Supreme Court
articulated four elements necessary to exempt a cause of
action from the anti-SLAPP law:
(1) the cause of action is against a person primarily engaged
in the business of selling or leasing goods or services;
(2) the cause of action arises from a statement or conduct
by that person consisting of representations of fact about
that person's or a business competitor's business
operations, goods, or services;
(3) the statement or conduct was made either for the
purpose of obtaining approval for, promoting, or securing
sales or leases of, or commercial transactions in, the
person's goods or services or in the course of
delivering the person's goods or services; and
(4) the intended audience for the statement or conduct
meets the definition set forth in section 425.17(c)(2).
Simpson, 49 Cal.4th at 30.
argues that Attorney Defendants were primarily engaged in
selling services, i.e., legal services. (Opp'n 8.) He
also argues Attorney Defendants' conduct was made in the
course of delivering a service; specifically, “in
connection with their claimed protected conduct of filing a
trademark application that contained an image that infringed
plaintiff's copyright.” (Id.) Finally, the
conduct arose out of a regulatory approval process,
proceeding, or investigation-the filing of a trademark
Simpson, Attorney Defendants meet the first element
because they were primarily engaged in selling legal
services. Their conduct does not, however, meet the second
element. Plaintiff argues Attorney Defendants' conduct at
issue is “filing a trademark application.”
(Id.) The act of filing a trademark is not a
representation about their own business-Defendants made
representations on behalf of its client. Nor is it statement
or conduct about a competitor's business-Donahue and
Schacht's business competitors are other law firms. The
relevant comparison is not Attorney Defendants' conduct
or statement relative to Plaintiff, but to Attorney
Defendants' business competitors for legal services.
Therefore, pursuant to Simpson and section 425.17(c)
Attorney Defendants are not making a representation about
themselves or a business competitor.
case law Plaintiff cites buttresses this conclusion. In its
Previous Order, the Court relied in part on Mindys
Cosmetics, Inc. v. Dakar, 611 F.3d 590, 593 (9th Cir.
2010) (“Mindys”), for the proposition
that filing a trademark application with the U.S. Patent and
Trademark Office is protected by the anti-SLAPP statute.
(Previous Order 15.) Plaintiff references a single quote from
JaM Cellars, Inc v. Vintage Wine Estates, Inc., No.
17-1133-CRB, 2017 WL 2535864, at *3 (N.D. Cal. June 12,
2017), to distinguish Mindys from trademark
infringement cases: “Many infringement cases will
mention a defendant's trademark application process, and
they cannot all run afoul of the anti-SLAPP statute.”
The Court does not disagree with such a generalized
statement. Yet, Plaintiff does not go further to explain how
JaM Cellars's facts support his claim. In
JaM Cellars, not only did the plaintiff allege that
the defendant's lawyer filed trademark registrations, but
also that the defendant attempted to “trade on the
goodwill of JaM's [trademarks], to ‘use' the
contested marks, to market competing wines . . . and to use
the [competing wines] in commerce.” Id.
(citations omitted) (second and third alterations in
Plaintiff only argues that the section 425.17(c) exception
applies because of Attorney Defendants' conduct in
“filing a trademark application that contained an image
that infringed on plaintiff's copyright.”
(Opp'n 8.) This reflects only the protected activity of
filing a trademark and does not reach the unprotected
activity in JaM Cellars. Therefore, Plaintiff fails
to establish Attorney ...