ThermoLife International LLC v. Gaspari Nutrition Incorporated et al

Filing 447

ORDER that Gaspari Nutrition, Inc.'s Application for Attorneys' Fees (Doc. 405 ) is denied, ThermoLife's Motion for an Award of Attorneys' Fees and Non-Taxable Expenses Related to GNI's Counterclaims (Doc. 398 ) is denied, and Plaintiff's Application for Attorneys' Fees Related to Discovery Master's Award of Sanctions (Doc. 396 ) is denied. See Order for details. Signed by Judge Neil V. Wake on 03/13/2014. (NVW, mh)

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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 ThermoLife International, LLC, Plaintiff/Counterdefendant, 10 11 ORDER v. 12 No. CV-11-01056-PHX-NVW Gaspari Nutrition, Inc., et al., Defendants/Counterclaimants. 13 14 Before the Court are three requests for attorneys’ fees: Gaspari Nutrition, Inc.’s 15 Application for Attorneys’ Fees (Doc. 405), ThermoLife’s Motion for an Award of 16 Attorneys’ Fees and Non-Taxable Expenses Related to GNI’s Counterclaims (Doc. 398), 17 and Plaintiff’s Application for Attorneys’ Fees Related to Discovery Master’s Award of 18 Sanctions (Doc. 396). In deciding these requests, the Court does not consider Gaspari 19 Nutrition, Inc.’s Notice of Evidence Relevant to a Finding of Exceptionality (Doc. 387) 20 and GNI’s response (Doc. 389), which were filed without leave of court or other 21 authorization. 22 I. BACKGROUND 23 ThermoLife International, LLC (“TLI”) and Gaspari Nutrition, Inc. (“GNI”) have 24 been competitors in the business of selling dietary supplement products related to 25 bodybuilding. In its First Amended Complaint, TLI alleged eleven counts, nine of which 26 were for false advertising under 15 U.S.C. § 1125(a)(1)(B), which is § 43(a)(1)(B) of the 27 Lanham Act. 28 competition and tortious interference with business and business expectancy. In its The First Amended Complaint also alleged common law unfair 1 Counterclaim, GNI alleged unfair competition, trade disparagement, and, under 2 15 U.S.C. § 1125(a), false designations of origin, false descriptions, false advertising, and 3 unfair competition. 4 On January 10, 2014, four motions by GNI and two motions by TLI to exclude all 5 or portions of the opposing party’s expert witness evidence were granted, and both 6 parties’ motions for summary judgment were granted. (Doc. 391.) In addition, two 7 motions by TLI for sanctions were denied. (Id.) On January 27, 2014, the Court ruled 8 that, although each party prevailed on its motion for summary judgment, only one party is 9 permitted to recover taxable costs, GNI was the prevailing party in net, and therefore GNI 10 was entitled to recovery of taxable costs that were not pertinent only to prosecution of 11 GNI’s unsuccessful counterclaims. (Doc. 406.) 12 II. LEGAL STANDARD 13 Both parties seek fees under 15 U.S.C. § 1117(a), which provides that the court 14 may award reasonable attorneys’ fees to the prevailing party on § 1125(a) claims in 15 exceptional cases. 16 attorneys’ fees to a prevailing party in ‘exceptional circumstances.’” Gracie v. Gracie, 17 217 F.3d 1060, 1071 (9th Cir. 2000). Awards under § 1117(a) “are never automatic and 18 may be limited by equitable considerations.” 19 506 F.3d 1165, 1178 (9th Cir. 2007) (quoting Rolex Watch, U.S.A., Inc. v. Michel Co., 20 179 F.3d 704, 711 (9th Cir. 1999)). Section 1117(a) “permits, but does not mandate, an award of Inc. v. eBay, Inc., 21 An action may be considered “exceptional” when a plaintiff’s case is groundless, 22 unreasonable, vexatious, or pursued in bad faith. Secalt S.A. v. Wuxi Shenxi Const. Mach. 23 Co., Ltd., 668 F.3d 677, 687 (9th Cir. 2012). “The line distinguishing exceptional cases 24 from non-exceptional cases is far from clear. It is especially fuzzy where the defendant 25 prevails due to plaintiff’s failure of proof.” Id. “[E]xceptional cases include instances 26 where plaintiff’s case is frivolous or completely lacking in merit.” Id. Animosity 27 between parties alone does not make a case exceptional. See Stephen W. Boney, Inc. v. 28 Boney Servs., Inc., 127 F.3d 821, 827 (9th Cir. 1997). -2  1 III. ANALYSIS 2 GNI seeks an award of $1,743,053.13 for attorneys’ fees and $343,643.60 for its 3 expert witness fees. GNI contends this is an exceptional case because TLI’s claims were 4 groundless and TLI acted in bad faith throughout the litigation. GNI particularly points 5 to TLI’s conduct outside of the litigation as evidence of bad faith. 6 TLI does not believe a fee award is appropriate in this case, but contends that if 7 there is any basis for awarding GNI fees for prevailing on TLI’s claims, the same basis 8 exists for awarding TLI fees for prevailing on GNI’s counterclaims. TLI contends that 9 GNI’s counterclaims were baseless and GNI engaged in litigation misconduct, 10 particularly regarding discovery. 11 appropriate for either party, TLI requests an award in the amount of $384,101.75 for fees 12 and $163,230.42 for non-taxable costs incurred defending against GNI’s counterclaims. 13 This includes $123,768.80 for the cost of electronically stored discovery. To the extent that the Court finds that fees are 14 TLI also seeks attorneys’ fees related to the Discovery Master’s award of 15 sanctions. (Docs. 239, 309.) TLI seeks an award of $5,672.50, but only $1,657.50 if 16 granted its fee request related to prevailing on GNI’s counterclaims. 17 This is one of those cases where the line distinguishing exceptional cases from 18 non-exceptional cases is “especially fuzzy.” Neither party was successful on any of its 19 claims. 20 contentions that the opposing party’s claims were groundless even though the Order did 21 not address whether the claims completely lacked merit. 22 misconduct and overlitigation by both parties. It would be possible to examine the fee 23 requests in detail, eliminate certain categories such as expert witness fees, reduce and/or 24 shift discovery fees and expenses based on fault, and determine whether either party 25 would be entitled to any award after offset. However, equitable considerations support 26 denial of all of the fee requests without doing further calculation and weighing. Both parties rely on the Court’s January 10, 2014 Order to support their 27 28 -3  And the record shows 1 Therefore, it is unnecessary to decide which side of the line this case falls on because fees 2 will be denied to both parties regardless of exceptionality. 3 IT IS THEREFORE ORDERED that Gaspari Nutrition, Inc.’s Application for 4 Attorneys’ Fees (Doc. 405) is denied, ThermoLife’s Motion for an Award of Attorneys’ 5 Fees and Non-Taxable Expenses Related to GNI’s Counterclaims (Doc. 398) is denied, 6 and Plaintiff’s Application for Attorneys’ Fees Related to Discovery Master’s Award of 7 Sanctions (Doc. 396) is denied. 8 Dated this 13th day of March, 2014. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -4 

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