BEST MEDICAL INTERNATIONAL, INC. v. ACCURAY, INC. et al

Filing 115

ORDER granting in part and denying in part 92 Motion for Attorney Fees. Signed by Judge Terrence F. McVerry on 11/16/11. (mh, )

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
BEST MEDICAL INTERNATIONAL, INC.,
Plaintiff,
v
ACCURAY, INC., a corporation,
Defendant.

)
)
)
) 2:10-cv-1043
)
)
)

MEMORANDUM OPINION AND ORDER OF COURT
Pending before the Court is DEFENDANT ACCURAY INCORPORATED’S
MOTION/PETITION FOR ATTORNEYS’ FEES AND EXPENSES (Document No. 92), with
Declarations from counsel Madison Jellins and Kirsten Rydstrom (Document No. 94). Plaintiff
Best Medical International, Inc. (“BMI”) filed a memorandum and brief in opposition
(Document No. 93, 95); Accuray filed a reply brief (Document No. 98) with sealed supplemental
Declarations from Jellins and Rydstrom (Document Nos. 101, 102); and BMI filed a sur-reply
brief (Document No. 107). Thus, the petition has been fully briefed and is ripe for disposition.

Factual and Procedural Background
This is a patent infringement case in which Plaintiff BMI has repeatedly failed to comply
with the Local Patent Rules. To briefly recap, on June 15, 2011 Accuray was forced to file a
motion to compel complete Initial Disclosures by BMI pursuant to LPR 3.1. On June 30, 2011,
the Court entered an Order (the “June 30 Order”) which granted Accuray’s motion to compel and
criticized BMI’s belated and apparently lackadaisical approach to its disclosure obligations under
the Local Patent Rules. Despite that chastisement, Accuray was required to file a second motion
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to enforce the June 30 Order and a third motion to compel adequate Infringement Contentions
pursuant to LPR 3.2. Accuray also filed a fourth motion to obtain an extension of time to file its
responsive Non-Infringement Contentions. On August 19, 2011, the Court issued a
Memorandum Opinion and Order which concluded that “BMI has not complied with the letter or
spirit of Local Patent Rules 3.1 and 3.2, or with the Court’s June 30 Order.” Accordingly, the
Court granted Accuray’s motions and authorized Accuray to “submit a petition setting forth the
reasonable counsel fees and costs it has incurred in connection with each of the motions to
compel.” (Emphasis added).
Accuray seeks counsel fees incurred by attorneys in three separate locations. Madison
Jellins is located in California, Janice Christensen is located in New York City and Kirstin
Rydstrom is located in Pittsburgh. Accuray avers that its attorneys are specialized and
experienced in patent litigation (Jellins1 -- 21years; Christenson2 -- 8 years; and Rydstrom3 -- 15
years). Accuray also seeks to recover for time billed by Reed Smith senior paralegal Lisa
Santucci. Jellins declares that her hourly rate for this case while she was employed by Alston &
Bird was $625 per hour, and her current rate at Helix is $550 per hour and that Christensen’s
hourly rate on this case is $525 per hour. Rydstrom declares that her hourly rate is $565 per hour
and that Santucci’s paralegal rate is $295 per hour.
The petition and original Declarations conclusorily represented that all hours and
expenses were reasonably necessary. However, Accuray did not provide an itemized listing of
the tasks performed by any of the timekeepers.

1

Jellins has represented Accuray throughout this litigation, formerly as a partner at the firm Alston & Bird LLP and
now at Helix IP LLP.
2
Christensen is a senior associate attorney at Alston & Bird LLP.
3
Rydstrom is a partner at Reed Smith LLP.
2

In its response, BMI contended that Accuray failed to establish a prima facie case to
recover attorneys fees and costs: (1) by failing to establish the prevailing market rate in the
relevant Pittsburgh legal market; and (2) by failing to provide detailed information regarding the
tasks performed. BMI suggests that Jellins’ and Rydstrom’s hourly rate be reduced to $365 per
hour; Christensen’s rate be reduced to $200 per hour; and Santucci’s rate be reduced to $100 per
hour. In addition, BMI suggests that all of the hours claimed be reduced by thirty-five percent
(35%). BMI also opposed Accuray’s effort to recover costs related to the motion to compel
Initial Disclosures, the motion for extension of time, and the time spent to prepare the fee
petition.
Accuray then filed supplemental Declarations from Jellins and Rydstrom. In her
supplemental Declaration, Jellins provided a cursory overview of the tasks performed by her and
Christensen. As an illustration, Jellins averred that in connection with the motion to compel
Initial Disclosures, she “spent approximately 5 hours drafting meet and confer letters, 10.6 hours
working on the Opening brief, and 13.1 hours working on the Reply brief.” The other tasks
performed by Jellins and Christensen were described with a comparable level of generality.
Rydstrom’s supplemental Declaration provided additional information about the hourly billing
rates of Reed Smith intellectual property attorneys, but did not address BMI’s objections about
the lack of specificity regarding the tasks performed. Accuray has not produced detailed, dayby-day, task-specific time sheets to support the hours claimed by counsel. In sum, Accuray
contends that BMI “is in no position to judge whether the number of hours spent by Accuray was
excessive” and argues that the hours spent were attributable to BMI’s lackadaisical approach to
this case.

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In its reply brief, Accuray also contends that it had sufficiently established the
reasonableness of its claimed hourly rates. Nevertheless, in further support of its position,
Accuray submitted a recent affidavit regarding prevailing Pittsburgh patent litigation rates. The
affidavit had been prepared by attorney Kent Baldauf in connection with another patent case
pending before this member of the Court, Air Vent, Inc. v. Vent Right Corp., Civil Action No. 08146. In the affidavit, attorney Baldauf noted that Pittsburgh patent litigation counsel rates range
from $300-600 per hour and he opined that the patent attorneys’ “requests for $350 per hour for
work performed in [the Air Vent] case falls within the prevailing fee scale and is very
reasonable.”
In its surreply brief, BMI continues to argue that: (1) fees should be limited to the motion
to enforce the June 30 Order and the motion to compel Infringement Contentions; (2) that the
hours claimed are excessive; (3) that Accuray’s descriptions of the work performed lack
specificity; and (4) that the hourly rates should be reduced. The Court will address these issues
seriatim.
The tasks and hours for which Accuray seeks to recover counsel fees are set forth below:

4

Accuray seeks to recover $107,102.50 in fees based on the Jellins Declarations4 as follows:
A. Motion to Compel Initial Disclosures
a. Jellins
28.7 hours
b. Christensen
24.0 hours
B. Motion to Enforce June 30 Order
a. Jellins
19.3 hours
b. Christensen
21.0 hours
C. Motion to Compel Infringement Contentions
a. Jellins
38.7 hours
b. Christensen
33.6 hours
D. Motion for Extension of Time
a. Christensen

1.0 hours

E. Fee Petition and Reply
a. Jellins (at Helix rate)
b. Christensen

14.5 hours
6.0 hours

Accuray seeks to recover fees of $11,995 based on the Rydstrom Declarations as follows:
A. Motion to Compel Initial Disclosures
a. Rydstrom
3.9 hours
B. Motion to Enforce June 30 Order
a. Rydstrom
3.4 hours
b. Santucci
3.2 hours
C. Motion to Compel Infringement Contentions
a. Rydstrom
6.8 hours
b. Santucci
3.2 hours
D. Motion for Extension of Time
a. Rydstrom
b. Santucci
E. Fee Petition
a. Rydstrom
4

0.8 hours
0.8 hours
2.5 hours

As BMI points out and Accuray concedes, the original calculation contained a mathematical/transpositional error
which was corrected in Jellins’ second Declaration. In particular, Jellins spent 38.7 hours and Christensen spent
33.6 hours on the motion to compel Infringement Contentions. The supplemental Declaration also reflects the
addition of time spent by Jellins and Christensen on the Fee Petition and reply thereto.
5

Accuray also seeks to recover costs for duplicating and Westlaw research of $63.18,
which have not been contested by BMI. In total, Accuray claims fees of $119,097.50 plus costs
of $63.18.

Legal Analysis
In a recent opinion in NFL Properties LLC v. Wohlfarth, 2011 WL 1402770 (W.D. Pa.
2011) (which also involved recovery of fees incurred by both Pittsburgh and out-of-town
counsel), this member of the Court thoroughly articulated the standards which govern fee
petitions in this circuit. Briefly summarized, the burden to establish reasonableness is on the
party seeking an award of fees. The Court must first calculate a lodestar rate by multiplying a
reasonable hourly rate in the relevant (Pittsburgh) legal community by the reasonable number of
hours expended. Once the lodestar amount has been calculated, a court has discretion to adjust
the fee upward or downward, based on a variety of factors. District courts are instructed to
conduct a “thorough and searching analysis” of the fee application. A prevailing party may only
recover for time reasonably expended and the Court must exclude time that was excessive,
redundant or unnecessary. As the hourly rate demanded goes up, there should be a
corresponding decrease in the amount of time required to accomplish necessary tasks, due to
counsel's experience and expertise. Time that would not be billed to a client cannot be imposed
on an adversary. See generally NFL Properties, 2011 WL 1402770 at * 2-5.

1. Applicable Motions For Which Recovery May Be Sought
As an initial matter, BMI contends that Accuray may only recover fees related to the
motion to enforce the June 30 Order and the motion to compel Infringement Contentions. The
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Court disagrees. It was BMI’s repeated failure to fully comply with its obligations under the
Local Patent Rules which caused Accuray to incur all of the counsel fees and costs at issue. The
Court’s August 19, 2011 Memorandum Opinion expressly provided that Accuray was entitled to
recover fees in connection with “each” of the three motions to compel, including the original
motion to compel Initial Disclosures. Fees incurred to prepare the motion for extension of time
are also recoverable because that motion was necessitated by BMI’s misconduct. Finally, a party
is generally entitled to recover the fees incurred to prepare the fee petition. See Planned
Parenthood of Cent. N.J. v. Attorney Gen. of State of N.J., 297 F.3d 253, 268 (3d Cir. 2002). It is
entirely fair to impose the reasonable fees and costs for all of these activities upon BMI.

2. Hourly Rate
The Court must base its decision as to the prevailing rate in the Pittsburgh community on
the record, rather than a generalized sense of what is customary or proper. To satisfy its prima
facie case requirement, the party seeking fees must demonstrate that its requested rates are the
prevailing rates in the relevant community. Smith v. Philadelphia Housing Authority, 107 F.3d
223, 225 (3d Cir.1997). “To inform and assist the court in the exercise of its discretion, the
burden is on the fee applicant to produce satisfactory evidence— in addition to the attorney's
own affidavits—that the requested rates are in line with those prevailing in the community for
similar services by lawyers of reasonably comparable skill, experience and reputation.” Id. at 225
n. 2 (quoting Blum v. Stenson, 465 U.S. 886, 895 n. 11, 104 S. Ct. 1541, 79 L. Ed.2d 891 (1984))
(emphasis added in Smith). If a party fails to meet its burden to demonstrate that the requested
rates were the prevailing rates in the community, “the district court must exercise its discretion in
fixing a reasonable hourly rate.” Washington v. Philadelphia Court of Common Pleas, 89 F.3d
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1031, 1036 (3d Cir. 1996). In Blum v. Witco, 829 F.2d 367, 377 (3d Cir. 1987), the Court held
that a hearing is only necessary if there are disputed questions of fact. See generally NFL
Properties, 2011 WL 1402770 at * 2-5.
As noted above, Accuray seeks counsel fees incurred by attorneys in three separate
locations. Accuray is certainly entitled to select counsel of its own choosing. Id. However, it is
equally true that Accuray has failed to submit evidence -- other than its own attorneys’ affidavits
-- to prove that the rates claimed are reasonable in the Pittsburgh legal community. See NFL
Properties (citing Smith, Blum) (reasonableness showing must rest on more than attorneys' own
statements). The belated submission of an affidavit prepared in the Air Vent case does not
address the question of whether the rates claimed by Jellins, Christensen and Rydstrom are
reasonable in this case. Moreover, attorney Baldauf’s actual opinion in the Air Vent case was
that an hourly rate of $350 per hour for experienced patent litigators in the Pittsburgh market is
reasonable. 5 This opinion supports the positions of both parties.
Because Accuray has failed to meet its burden of proof, the Court must determine a
reasonable rate. The Court will assign an hourly rate of $400 per hour for Jellins and Rydstrom;
a rate of $250 per hour for Christensen; and a rate of $150 per hour for Santucci. These rates are
comparable to the rates used in NFL Properties for an associate attorney and paralegal with
similar years of experience and well within the market range identified by attorney Baldauf.

5

One of the attorneys whose rates were at issue in the Air Vent case was the head of the patent and intellectual
property litigation practice of his firm and had ten years of patent litigation experience and the other attorney had
forty years of patent litigation experience.
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3. Reasonable Hours Expended
BMI can be held liable only for Accuray’s “reasonable” counsel fees and costs. The
Court must exclude time that was excessive, redundant or unnecessary. At first blush, the
number of hours expended in connection with these motions to compel appears to be excessive,
particularly in light of counsel’s experience and claimed hourly rates. As the hourly rate
demanded goes up, there should be a corresponding decrease in the amount of time required to
accomplish necessary tasks.
Accuray has failed to provide sufficient detail as to the work performed (despite two
opportunities to do so and notice of BMI’s specific challenge to the inadequacy of the original
Declarations). Accuray’s argument that BMI “is in no position to judge whether the number of
hours spent by Accuray was excessive” entirely misses the point. It is the Court who must
conduct a “thorough and searching analysis” of the fee application, as required by circuit
precedent, to determine whether the number of hours claimed is reasonable. Accuray has not
provided sufficient information to enable the Court to perform this analysis. Thus, the Court
must exercise its discretion to determine a reasonable number of hours.
In particular, it would not be reasonable to award fees connected to the underlying review
of Initial Disclosures and Infringement Contentions because that activity would have been
necessary even if BMI had fully complied with its obligations. See Merck Eprova AG v. Gnosis
S.P.A., 2011 WL 1142929 * 12 (S.D.N.Y. 2011) (passing cost of underlying document review to
opposing party would result in unjustified windfall). It further appears, from the similar amount
of hours claimed by each attorney, that Jellins and Christensen may have engaged in a
duplicative and/or inefficient distribution of the work. It appears that Jellins may have actively
participated in the actual research, preparation and drafting rather than performing a more
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traditional review and approval role. The participation of three experienced attorneys in different
locations likely also contributed to inefficiencies which are not fairly passed on to BMI. As
noted above, the record evidence presented by Accuray is insufficient to overcome these
concerns. The Court concludes that an across-the-board reduction of thirty percent (30%) for all
hours claimed is reasonable.
Finally, the fee petition and supporting filings in this case do not comply with the
standards required by circuit precedent and have not assisted this Court’s determination. As
explained above, Accuray has failed to meet its prima facie case on either prong of the lodestar
calculation. These shortcomings are particularly inexplicable because BMI’s response contained
lengthy quotes of the applicable standard as set forth in NFL Properties. Indeed, Accuray cited
NFL Properties in its reply brief, but nevertheless submitted supplemental Declarations which
again failed to meet that standard. Accordingly, all fees incurred by Accuray in connection with
the fee petition are not recoverable.

4. Summary/Revised Calculation
In accordance with the foregoing, the Court has exercised its discretion to determine the
appropriate hourly rates for each timekeeper, as follows: Jellins - $400/hour; Christensen $250/hour; Rydstrom - $400/hour; and Santucci - $150/hour. The Court has reduced the number
of hours worked across-the-board by thirty percent (30%). In other words, the Court will award
seventy percent (70%) of the hours claimed by Accuray, except that Accuray may not recover
fees in connection with the fee petition. The Court has prepared a revised lodestar calculation
based on these numbers. Accuray is entitled to recover the following reasonable counsel fees
and costs which it incurred as a result of BMI’s failures to follow the Local Patent Rules:
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A. Motion to Compel Initial Disclosures
a. Jellins (.70 * 28.7 hours @ $400/hour)

$ 8,036

b. Christensen (.70 * 24.0 hours @ $250/hour)

$ 4,200

c. Rydstrom (.70 * 3.9 hours @ $400/hour)

$ 1,092

B. Motion to Enforce June 30 Order
a. Jellins (.70 * 19.3 hours @ $400/hour)

$ 5,404

b. Christensen (.70 * 21.0 hours @ $250/hour)

$ 3,675

c. Rydstrom (.70 * 3.4 hours @ $400/hour)

$

952

d. Santucci (.70 * 3.2 hours @ $150/hour)

$

336

C. Motion to Compel Infringement Contentions
a. Jellins (.70 * 38.7 hours @ $400/hour)

$10,836

b. Christensen (.70 * 33.6 hours @ $250/hour)

$ 5,880

c. Rydstrom (.70 * 6.8 hours @ $400/hour)

$ 1,904

d. Santucci (.70 * 3.2 hours @ $150/hour)

$

336

a. Christenson (.70 * 1.0 hours @ $250/hour)

$

175

b. Rydstrom (.70 * 0.8 hours @ $400/hour)

$

224

c. Santucci (.70 * 0.8 hours @ $150/hour)

$

84

D. Motion for Extension of Time

Total Reasonable Counsel Fees

=

$43,134

The subtotal of recoverable Alston & Bird counsel fees (Jellins and Christensen) is
$38,206. The subtotal of recoverable Reed Smith fees (Rydstrom and Santucci) is $4,928. In
addition, Reed Smith incurred recoverable costs of $63.18. The Court finds that this revised

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lodestar calculation is reasonable and that additional upward or downward adjustments are not
necessary. The grand total which BMI shall pay to Accuray is $43,197.18.

An appropriate Order follows.

McVerry, J.

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IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
BEST MEDICAL INTERNATIONAL, INC.,
Plaintiff,
v
ACCURAY, INC., a corporation,
Defendant.

)
)
)
) 2:10-cv-1043
)
)
)

ORDER OF COURT
AND NOW, this 16th day of November, 2011, in accordance with the foregoing
Memorandum Opinion, it is hereby ORDERED, ADJUDGED AND DECREED that
DEFENDANT ACCURAY INCORPORATED’S MOTION/PETITION FOR ATTORNEYS’
FEES AND EXPENSES (Document No. 92) is GRANTED IN PART AND DENIED IN
PART. Accuray is awarded its reasonable counsel fees and costs in the grand total amount of
$43,197.18. BMI shall pay this amount to Accuray within thirty (30) days.

BY THE COURT:
s/Terrence F. McVerry
United States District Judge

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cc:

Brit D. Groom, Esquire
Email: [e-mail]
Eric P. Reif, Esquire
Email: [e-mail]
Anthony J. Basinsky, Esquire
Email: [e-mail]
Kirsten R. Rydstrom, Esquire
Email: [e-mail]
Janice A. Christensen, Esquire
Email: [e-mail]
Jennifer Liu, Esquire
Email: [e-mail]
Madison C. Jellins, Esquire
Email: [e-mail]

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