Award of Attorney’s Fees in Copyright Litigation in the USA

1 Dec 2011 Page 1 of 121 Award of Attorney s fees inCopyright Litigation in the U S ACopyright 2010-2011 by Ronald B. StandlerNo Copyright claimed for works of the Copyright claimed for quotations from any source, except for selection of such s fees , Copyright , defendant, fee-shifting, plaintiff, prevailing,reasonable, reimbursement, Second Circuit, Seventh Circuit, Ninth CircuitTable of ContentsIntroduction .. 4 Overview .. 5 American Rule .. 617 505 .. 7 Old Law in the Second Circuit .. 9 Diamond (1984) .. 10 Roth (1986) .. 10 Whimsicality (1989) .. 11 Folio Impressions (1991) .. Supreme Court: Fogerty (1994) .. 12 Lieb (3dCir. 1986) .. 13 McCulloch (9thCir.)

2 1987) .. 14 Purpose(s) of Copyright Act .. 17 Modern Law in Second, Fourth, & Ninth Circuits .. 20 Second Circuit .. 20 Matthew Bender (2001) .. 20 Crescent Publishing (2001) .. 22 Fourth Circuit .. 24 Rosciszewski (1993) .. 24 Diamond Star (1994) .. 24 Superior Form Builders v. Dan Chase (1996) .. 25 Ninth Circuit .. Dec 2011 Page 2 of 121 Jackson v. Axton (1994) .. 25 Fogerty after remand (1996) .. 26miscellaneous Ninth Circuit .. 32 Modern Law in the Seventh Circuit .. 34 NLFC v. Devcom ( 1996) .. 34 Budget Cinema (1996) .. 35 FASA v. Playmates Toys (1997) .. 36 Harris Custom Builders (1998) .. 39 Gonzales (2002) .. 40 Assessment Technologies (2004).

3 42 Woodhaven Homes (2005) .. 47 Bryant v. Gordon ( Ill 2007) .. 50 JCW Investments v. Novelty (2007) .. 50 Riviera (2008) .. 51 Mostly Memories v. For Your Ease (2008) .. 54 Eagle Services (2008) .. 55 Lieb factors in Seventh Circuit .. 56before Assessment Technologies .. 56 Gonzales and Assessment Technologies .. 57after Assessment Technologies .. 58prevailing defendant in 7th Circuit .. 60 Ability to pay fees .. 61 Agee (1994) .. 61 Lotus v. Borland (1998) .. 62 MiTek (1999) .. 63other Copyright cases in the Courts of Appeals .. 64inability to pay in other areas of civil law .. 65need evidence in trial court .. 67analogy to criminal law.

4 67 Improper Motive for Litigation .. 69 Willful Infringement .. 71other misconduct .. 73 Novel or Complex Legal Issues .. 73 Purely Technical Win .. 77 Reasonableness .. Dec 2011 Page 3 of 121 Johnson v. Georgia Highway Express (5thCir. 1974) .. 78 Lodestar Method .. Supreme Court .. 82 Hensley v. Eckerhart (1983) .. 82lodestar .. 84 Blum v. Stenson (1984) .. 85lodestar presumed to be the reasonable fee .. 86same standards in all fee-shifting statutes .. 87 Farrar v. Hobby (1992) .. 88 Hensley is still valid.. 90Is Johnson still valid? .. 92 Second Circuit .. 95 Arbor Hill (2008) .. 96 Seventh Circuit .. 99five-factor test.

5 100 Moriarty (2005) .. 101 Schlacher (2009) .. 103 Anderson v. AB Painting and Sandblasting (2009) .. 105miscellaneous cases .. 108 Ninth Circuit .. 109 fees Make Plaintiff Whole ? .. 110 Registration of Copyright .. 111 Appeal of Attorney s fees .. 115A. Standard of Review .. 115de novo review on matters of law .. 116B. Must Consider All Relevant Factors .. 117 Conclusion .. 119 Bibliography .. Dec 2011 Page 4 of 121 IntroductionI began the legal research in this essay when a federal judge in Illinois granted summaryjudgment to the defendant in a Copyright infringement case, and the prevailing defendant then fileda motion to recover $750,000 in attorney s fees . I did legal research for the plaintiff s attorney.

6 After this case was concluded and after all appeals were finished, I posted my legal research butnot my confidential analysis of the client s case at my website in this essay reviews the evolution of legal criteria and standards for awards of attorney s fees incopyright cases, with emphasis on the Supreme Court s opinion in Fogerty, and subsequentcases in the Second, Fourth, Seventh, and Ninth Circuits. I included the Second and Ninth Circuitcases, because they are the major sources of Copyright law jurisprudence in the I includedmany Seventh Circuit cases in this essay, because that was the jurisdiction where the case thatinspired this essay was located. I included the Fourth Circuit, because some early Seventh Circuitcases cited Fourth Circuit cases.

7 Because of the enormous value of fee-shifting in this case,I searched all federal cases nationwide for some detailed at page 82, I include some remarks on the concept of reasonable in fee-shifting ingeneral, mostly from cases in the Supreme Court or the Seventh Circuit. I did my own research first, so I could make an independent evaluation of the law on thistopic. After I had spent approximately 80 hours doing legal research and drafting this essay during3-17 May 2010, I went to a law library and searched for law review articles about fee-shifting incopyright cases. I found two articles published before the Supreme Court opinion inFogerty, and four articles after topic of fee-shifting in Copyright cases has received little attention in law review articles,and appellate opinions generally dispose of appeals of fee awards/denials in a terse paragraph ortwo.

8 This lack of attention to fee-shifting is strange because the amount of attorney s fees oftenexceeds US$ 100,000 and the amount of fees is often greater than the amount of damages awardedto a prevailing plaintiff in a Copyright infringement The major publishing companies and television networks have headquarters in New York City(Second Circuit) and movie studios have headquarters in the Los Angeles area (Ninth Circuit). Dec 2011 Page 5 of 121 disclaimerThis essay presents general information about an interesting topic in law, but is not legaladvice for your specific problem. See my disclaimer at . From reading e-mail sent to me by readers of my essays since 1998, I am aware that readers oftenuse my essays as a source of free legal advice on their personal problem.

9 Such use is notappropriate, for reasons given at . I list the cases in chronological order in this essay, so the reader can easily follow the historicaldevelopment of law. If I were writing a legal brief, then I would use the conventional citationorder given in the Bluebook. Because the original purpose of this essay was to collect cases thatcould be cited in a brief to a court, I have included long quotations from court cases. OverviewIf a plaintiff registers his/her Copyright with the Copyright Office before the defendantinfringes the Copyright , and if the plaintiff wins the Copyright infringement Litigation , then courtsmay order the defendant to reimburse at least some of the plaintiff s attorney s fees , under17 412, a defendant wins Copyright infringement Litigation , then courts may order the plaintiff toreimburse at least some of the defendant s legal fees , under 17 505.

10 The Seventh Circuithas case law since the year 2004 that establishes a very strong presumption that plaintiff will paythe prevailing defendant s attorney s fees , as explained below, beginning at page 42. Before the year 1994, prevailing plaintiffs were commonly awarded attorney s fees , but aprevailing defendant needed to prove that plaintiff s claims were either baseless, unreasonable,frivolous, or brought in bad faith before a prevailing defendant could recover attorney s This dual standard was overruled by the Supreme Court in Fogerty in 1994. For this reason,one needs to use caution when citing cases decided before 1995 involving reimbursement ofattorney s fees in Copyright Litigation . There are two sets of criteria that judges should consider when awarding attorney s fees incopyright cases.