Eastern Property Development LLC et al v. Gill
Filing
139
ORDER denying 118 Motion for Attorney Fees; denying 122 Motion for Remittitur. Ordered by Judge Clay D. Land on 12/12/2012. (CGC)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
COLUMBUS DIVISION
EASTERN PROPERTY DEVELOPMENT,
LLC and SOUTH EAST ENTERPRISE
GROUP, LLC,
*
*
Plaintiffs,
*
CASE NO. 4:11-CV-62 (CDL)
vs.
*
LOREN GILL,
*
Defendant.
*
O R D E R
The jury returned a verdict in favor of Plaintiffs Eastern
Property Development, LLC and South East Enterprise Group, LLC
(“Plaintiffs”)
Plaintiffs’
and
against
trespass,
Defendant
conversion,
Loren
and
Gill
(“Gill”)
interference
on
with
contractual relations claims, awarding Plaintiffs $35,335.98 in
compensatory damages and $250,000.00 in punitive damages.
Gill
contends that the punitive damages award was unconstitutionally
excessive and has filed a motion to reduce it to match the
compensatory damages award (ECF No. 122).
For the reasons set
forth below, the motion is denied.
Also pending before the Court is Plaintiffs’ Motion for
Attorneys’ Fees under § 35 of the Lanham Act, 15 U.S.C. § 1117
(ECF No. 118).
interference
In addition to their trespass, conversion, and
with
contractual
relations
claims,
Plaintiffs
pursued a trade name infringement claim under § 43 of the Lanham
Act,
15 U.S.C. §
Plaintiffs
1125.
failed
to
The
prove
Court
previously
found
that
on
trade
name
damages
their
infringement claim, and the Court declined to submit that issue
to the jury.
The Court noted, however, that it would determine
after trial whether Plaintiffs are entitled to attorneys’ fees
on their trade name infringement claim.
As discussed below,
Plaintiffs’ motion for attorneys’ fees is denied.
I.
Gill’s Motion for Remittitur of Punitive Damages Award
The jury’s punitive damages award of $250,000.00 is roughly
seven times the compensatory damages award of $35,335.98.
It is
beyond dispute that “‘[p]unitive damages may properly be imposed
to further a State’s legitimate interests in punishing unlawful
conduct and deterring its repetition.’”
Cont’l Carbon Inc., 481 F.3d
Action Marine, Inc. v.
1302, 1317-18 (11th Cir. 2007)
(quoting BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 568 (1996)).
However, it is equally clear that “[t]he Due Process Clause of
the
Fourteenth
Amendment
prohibits
the
imposition
excessive or arbitrary punishments on a tortfeasor.”
Mut.
Auto.
Ins.
Co.
v.
Campbell,
538
U.S.
408,
of
grossly
State Farm
416
(2003).
Defendants’ motion requires the Court to determine whether the
award in this case is so excessive or arbitrary that it cannot
pass constitutional muster.
2
Having conducted the trial in this action, the Court cannot
conclude from the evidence presented that the punitive damages
award is grossly excessive in relation to the state’s legitimate
interest in punishing the conduct engaged in by the Defendant
and deterring similar conduct.
The Court also cannot conclude
that the punitive damages award is so disproportionate to the
amount
of
reduced.
compensatory
damages
recovered
that
it
must
be
The evidence presented at trial supports the jury’s
conclusion that Gill’s conduct was sufficiently reprehensible to
warrant the imposition of $250,000 in punitive damages.
The
Court acknowledges that the 7-to-1 ratio awarded by the jury is
higher
than
the
4-to-1
ratio
that
has
been
endorsed
by
the
Supreme Court, see Campbell, 538 U.S. at 425; however, the Court
also understands that an evaluation of the excessiveness of a
punitive
damages
award
cannot
be
“reduced
to
a
simple
mathematical formula,” Action Marine, 481 F.3d at 1321 (internal
quotation marks omitted).
The evidence in this case supported a
finding by the jury that Gill busted into Plaintiffs’ offices,
took
over
their
operations,
disrupted
interfered with their employees
provable
monetary
damages
their
and tenants.
ultimately
suffered
business,
and
The amount of
by
understates the egregiousness of Defendant’s conduct.
Plaintiffs
Moreover,
due to the fact that the Court issued a preliminary injunction
preventing further similar conduct during the pendency of the
3
action,
Plaintiffs’
compensatory
damages
were
mitigated
notwithstanding the fact that Gill violated that injunction on
one occasion.
The evidence presented at trial supported the
punitive damages award, and under the specific circumstances of
this
case,
the
Court
cannot
conclude
that
the
excessive to the point of being unconstitutional.
award
was
To reduce the
award would be tantamount to an arbitrary substitution of this
Court’s judgment for the collective wisdom of Plaintiffs’ peers
who sat on his jury.
While the Court has the obligation to
conduct an independent review of the constitutionality of the
award, the Court is not authorized to reduce it arbitrarily.
Based on the Court’s review, Gill’s motion for remittitur must
be denied.
II.
Plaintiffs’ Motion for Attorneys’ Fees
Plaintiffs seek attorneys fees based on their claim that
Gill infringed their trade name, South East Enterprise Group,
LLC, in violation of § 43(a) of the Lanham Act, 15 U.S.C. §
1125(a).
Specifically,
protected
Group,
interest
LLC,
and
metropolitan
area
in
Plaintiffs
the
that
trade
consumers
associate
that
contend
name
in
name
that
South
the
with
they
East
have
a
Enterprise
Columbus,
Georgia
Plaintiffs’
real
estate rental services.
Plaintiffs further assert that it was
trade
for
name
infringement
Gill
to
form
a
company
called
Southeastern Enterprise Group, LLC, open a bank account in that
4
company’s name, and send correspondence to Plaintiffs’ tenants
instructing them to remit their rent payments to Gill’s newly
formed company.
When Plaintiffs filed this action, they sought, and the
Court
granted,
a
preliminary
injunction
enjoining
Gill
from
“holding himself out as working for, acting for, or speaking on
behalf
of
either
Eastern
Property
Development
or
South
East
Enterprise or any other name that, because of its similarity to
those
two
names,
is
confusingly
similar.”
Preliminary Injunction 2, ECF No. 14.
that
once
the
Court
granted
their
Order
Granting
Plaintiffs acknowledge
motion
for
preliminary
injunction on June 28, 2011, Gill stopped using the name South
Eastern Enterprise Group, LLC.
entitled
to
attorneys’
Plaintiffs contend that they are
fees
for
the
period
before
the
preliminary injunction was entered.
Under
exceptional
§
35(a)
cases
may
of
the
award
Lanham
Act,
reasonable
“[t]he
attorney
court
fees
to
in
the
prevailing party” in an action under § 43(a) of the Lanham Act.
15 U.S.C. § 1117(a) (emphasis added).
further
defined
exceptional,
the
“While Congress has not
legislative
history
of
the
[Lanham] Act suggests that exceptional cases are those where the
infringing party acts in a malicious, fraudulent, deliberate, or
willful manner.
Burger King Corp. v. Pilgrim’s Pride Corp., 15
F.3d
(11th
166,
168
Cir.
1994)
5
(internal
quotation
marks
omitted); accord Lipscher v. LRP Publ’ns, Inc., 266 F.3d 1305,
1320
(2001)
(concluding
that
the
correct
exceptionality is fraud or bad faith).
rise
to
the
level
of
exceptionality,
standard
for
“Although a case may
the
decision
to
grant
attorney fees remains within the discretion of the trial court.”
Burger King Corp., 15 F.3d at 168.
In this case, the record is devoid of sufficient facts for
the Court to conclude that Plaintiffs are the prevailing parties
on their Lanham Act claim.
Plaintiffs acknowledge that their
trade name, South East Enterprise Group, is merely descriptive
and is thus not entitled to trade name protection unless it has
acquired secondary meaning.
See Tana v. Dantanna’s, 611 F.3d
767, 774 (11th Cir. 2010) (discussing requirements for trademark
validity).
“A name has acquired secondary meaning when the
primary significance of the term in the minds of the consuming
public is not the product but the producer.”
quotation
claim
marks
seemed
omitted).
to
be
an
At
trial,
afterthought.
Id. (internal
Plaintiffs’
Lanham
Plaintiffs
Act
failed
to
present sufficient evidence that the name “South East Enterprise
Group” has attained secondary meaning.
not
hold
Enterprise
today
that
Group,
has
Plaintiffs’
not
attained
Although the Court does
trade
name,
secondary
South
meaning
East
and
is
therefore not a protectable trade name, the Court does conclude
that
Plaintiffs
failed
to
meet
6
their
burden
of
establishing
secondary meaning at trial.
Accordingly, the Court finds that
Plaintiffs are not the “prevailing party” within the meaning of
§ 35(a) of the Lanham Act, and Plaintiff’s Motion for Attorneys’
Fees is therefore denied.
CONCLUSION
As discussed above, Gill’s motion to reduce the punitive
damages award (ECF No. 122) is denied, as is Plaintiffs’ Motion
for
Attorneys’
Fees
under
§
15 U.S.C. § 1117 (ECF No. 118).
35
of
the
Lanham
Act,
The Court previously stayed
collection of the judgment pending its ruling on Gill’s motion
to reduce the judgment.
That stay is now lifted.
IT IS SO ORDERED, this 12th day of December, 2012.
S/Clay D. Land
CLAY D. LAND
UNITED STATES DISTRICT JUDGE
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