Breadmore et al v. Jacobson

Filing 88

ORDER AND OPINION granting 85 Opposed MOTION for Attorney Fees. (Signed by Judge Melinda Harmon) Parties notified.(gclair, 4)

United States District Court
Southern District of Texas

ENTERED
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
PATRICK SCOTT BEARDMORE, et al,
Plaintiffs,
VS.
JAMES JACOBSON,
Defendant.

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August 12, 2016
David J. Bradley, Clerk

CIVIL ACTION NO. 4:13-CV-361

ORDER AND OPINION
Before the Court is Defendant James Jacobsen’s (“Jacobsen’s”) Motion for Attorney’s
Fees (Document No. 85), filed on April 19, 2016. Plaintiffs have not filed a response.1 Having
considered Defendant’s Motion and the applicable law, the Court concludes the Defendant’s
Motion is GRANTED.
Background
Plaintiffs initially asserted four claims against Defendant: conversion, violations of the
Texas Theft Liability Act, trade secret misappropriation and copyright infringement. (Document
No. 1 at ¶¶ 6-9). In response, Defendant asserted two counterclaims for declaratory judgment as
to ownership and, alternatively, breach of contract causing damages of $70,000. (Document No.
19 ¶¶ 7-9). On September 18, 2015, this Court issued a Corrected Opinion and Order on
Defendant’s Motion for Summary Judgment (Document No. 68), dismissing all of Plaintiffs’
claims. After all of Plaintiff’s claims were dismissed, Defendant filed a Motion for Attorney’s
1

Plaintiffs filed their Response (Document No. 86) on August 4, 2016, approximately three months past the
deadline, without explanation or leave of the Court. Pursuant to Local Rule 7.4, responses “must be filed by the
submission day.” “If the Court has not yet considered a pending motion, [] and a response is filed after the period
allotted by the Local Rules, the Court may consider the response at its discretion.” Lundy v. United States, No.
CIV.A. V-06-69, 2008 WL 1836682, at *3 (S.D. Tex. Apr. 23, 2008). The Court, pursuant to this discretion, will not
consider Plaintiffs’ Response, because it was filed so egregiously past the deadline, and without any request for
leave of Court. Martinez v. Holzknecht, No. CIV.A. 5-09-135, 2010 WL 4237534, at *3 (S.D. Tex. Oct. 21, 2010)
(“Because Plaintiff's response is untimely, Defendant’s summary judgment motion is treated as unopposed.”).

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Fees, Costs, and Sanctions. (Document No. 72).
The Court held a bench trial on the remaining counterclaims on November 9, 2015. On
March 30, 2016, the Court issued Findings of Fact and Conclusions of Law with respect to
Defendant’s counterclaims, finding that both of Defendant’s counterclaims failed. (Document
No. 82). Also on March 30, 2016, the Court partially granted Defendant’s Motion for Attorney’s
Fees, Costs, and Sanctions. (Document No. 83). The Court granted Defendant attorney’s fees for
his defense of the copyright claim only, and denied costs and sanctions. Id. at 5. Pursuant to the
Court’s Order, the Defendant filed the instant motion, detailing his attorney’s fees for defending
the copyright claim. (Document No. 85). Defendant requests an award of $109,838.75. Id. at 1.
Standard of Review
“The initial estimate of a reasonable attorney’s fee is properly calculated by multiplying
the number of hours reasonably expended on the litigation times a reasonable hourly rate,” a sum
commonly called the “lodestar.” Blum v. Stenson, 465 U.S. 886, 888 (1984). “[T]he fee applicant
bears the burden of establishing entitlement to an award and documenting the appropriate hours
expended and hourly rates. The applicant . . . should maintain billing time records in a manner
that will enable a reviewing court to identify distinct claims.” Hensley v. Eckerhart, 461 U.S.
424, 437 (1983). There is a strong presumption that the lodestar is a reasonable fee, and the fee
applicant bears the burden of demonstrating that an upward adjustment by application of the
Johnson factors is necessary to calculate a reasonable fee. Walker v. Dept. of HUD, 99 F.3d 761,
771 (5th Cir. 1996); Louisiana Power & Light Co. v. Kellstrom, 50 F.3d 319, 324 (5th Cir.
1995), cert denied, 516 U.S. 862 (1995).
A reasonable hourly rate is that rate in the community for such legal services rendered by
attorneys of comparable skill, experience, and reputation. Heidtman v. County of El Paso, 171
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F.3d 1039, 1043 (5th Cir. 1999); Alberti v. Klevenhagen, 896 F.2d 927, 936 (5th Cir. 1990),
vacated in part on other grounds, 903 F.2d 352 (5th Cir. 1990). A reasonable hourly rate should
be in accord with rates “prevailing in the community for similar services by lawyers of
reasonably comparable skill, experience and reputation.” Blum, 465 U.S. at 895-96 n.11. The fee
applicant bears the burden of producing evidence that the requested rate is appropriate within the
relevant community. Condon v. Hunting Energy Services, L.P., Civ. A. No. H-04-3411, 2006
WL 2882857, at *2 (S.D. Tex. Oct. 4, 2006).
In addition to the community rate, the district court must also consider the attorneys’
regular rates. Louisiana Power, 50 F.3d at 328. Generally when an attorney’s requested hourly
rate is his customary rate, when it is within the range of prevailing market rates, and when the
rate is not contested, it is viewed as prima facie reasonable. Id. at 329. To establish the
reasonableness of his requested rate, the fee applicant should produce satisfactory evidence
beyond his own affidavit “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.” Blum, 465 U.S. at 896 n.11. Furthermore, the court may exercise its own expertise
and judgment in making an independent valuation of appropriate attorney fees. Davis v. Bd. of
Sch. Comm’rs of Mobil County, 526 F.2d 865, 868 (5th Cir. 1976).
The court must determine whether the hours expended by the prevailing party’s counsel
were “reasonably expended,” both as to the total number of hours claimed and the specific hours
claimed. Condon, 2006 WL 2882857, at *2 (citing Louisiana Power, 50 F.3d at 329). The fee
applicant bears the burden of showing that the hours claimed were reasonably expended.
Hensley, 461 U.S. at 437. Compensable hours, reasonably spent, are determined from the
attorney’s contemporaneous time or billing records or other documentation which the district
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court must examine to discern which hours are compensable and which are not. Id. at 434;
Louisiana Power, 50 F.3d at 324.
The fee applicant should exercise “billing judgment” and keep billing time records in a
way that enables the reviewing court to “identify distinct claims.” Hensley, 461 U.S. at 437. See
also Gagnon v. United Technisource, Inc., 607 F.3d 1036, 1044 (5th Cir. 2010) (An applicant for
fees must submit documentation, e.g., contemporaneous billing records or detailed invoices or
affidavits, to permit the court to identify noncompensable hours and to determine an appropriate
amount of fees.). Counsel must “exclude from a fee request hours that are excessive, redundant,
or otherwise unnecessary . . . .” Id. See also Saizan v. Delta Concrete Products Company, 448
F.3d 795, 799 (5th Cir. 2006) (“[P]laintiffs seeking attorney’s fees are charged with the burden
of showing the reasonableness of the hours billed and, therefore, are also charged with proving
that they exercised billing judgment. Billing judgment requires documentation of the hours
charged and of the hours written off as unproductive, excessive, or redundant. The proper
remedy for omitting evidence of billing judgment does not include a denial of fees but, rather, a
reduction of the award by a percentage intended to substitute for the exercise of billing
judgment.” [footnotes omitted]).
In determining what is a reasonable fee, the courts in the Fifth Circuit must consider the
factors set out in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974),
abrogated on other grounds, Blanchard v. Bergeron, 489 U.S. 87 (1989) (holding that a fee
award under § 1988 should not be capped by a contingent fee agreement between the attorney
and his client). The twelve Johnson factors are (1) the time and labor required; (2) the novelty
and difficulty of the issues; (3) the skill required to perform the legal service adequately; (4) the
preclusion of other employment by the attorney because he accepted this case; (5) the customary
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fee for similar work in the community; (6) whether the fee is fixed or contingent; (7) time
limitations imposed by the client or the circumstances; (8) the amount involved and the results
obtained; (9) the experience, reputation, and ability of the attorneys; (10) the undesirability of the
case; (11) the nature and length of the professional relationship with the client; and (12) awards
in similar cases. Johnson, 488 F.2d at 717-19.
While the lodestar is relevant to determining a fee award, it is not the sole basis for
determining that award; the Johnson factors are applicable to deciding whether the lodestar is
reasonable, as well as to adjusting that award by a multiplier once the lodestar is calculated.
Abrams v. Baylor College of Medicine, 805 F.2d 528, 536 (5th Cir. 1986) (“The time and hours
spent on a case are a necessary ingredient in determining a fee award, but they should not be the
sole basis for determining a fee. The Johnson factors govern the determination of reasonableness
itself; they are not merely factors to be considered in adjusting the award once the lodestar is
calculated.”) (citing Johnson, 488 F.2d at 717).
As noted, based on one or more Johnson factors, the court may apply a multiplier to
adjust the lodestar up or down if that factor or factors are not already taken into account by the
lodestar, itself. Strong, 137 F.3d at 850. An adjustment may only be made if the Johnson factor
has not already been accounted for in the lodestar. In re Fender, 12 F.3d 480, 487 (5th Cir.
1994), cert. denied, 511 U.S. 1143 (1994); Shipes v. Trinity Indus., 987 F.2d 311, 320 (5th Cir.
1993) (“[T]he district court must be careful . . . not to double count a Johnson factor already
considered in calculating the lodestar when it determines the necessary adjustments.”), cert.
denied, 510 U.S. 991 (1993).
Four of the Johnson factors are presumably included in the lodestar calculation: the
novelty and complexity of the issues, the special skill and experience of counsel, the quality of
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representation, and the results obtained from the litigation. Blum, 465 U.S. at 898-99; Shipes, 987
F.2d at 320. “Although upward adjustments of the lodestar figure based on these factors are still
permissible, such modifications are proper only in certain rare and exceptional cases supported
by specific evidence on the record and detailed findings by the lower courts.” Id. The Fifth
Circuit has also held that two other factors, time limitations imposed by the client or the
circumstances and preclusion of other employment, are generally subsumed in the lodestar
calculation, too. Shipes, 987 F.3d at 321-22; Heidtman v. City of El Paso, 171 F.3d 1038, 1043
(5th Cir. 1999).
Discussion
Hourly Rate
Defendant requests $325/hour for attorney Michael Falick in 2013, and an increased rate
of $375/hour for Falick in 2014 and 2015. (Document No. 85 at 3). Defendant explains that
Falick “has been practicing law in the Houston community since 1991” and “specializes in trial
and appellate litigation,” and states that the hourly rate of $375 per hour is both customary and
consistent with the Houston legal market for attorneys with Mr. Falick’s experience and
expertise. (Document No. 85 at 9). However, the Motion does not provide a specific statement
that these hourly rates were the regular rate for Falick, nor does the Motion include evidence
beyond the affidavit, demonstrating 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.” Louisiana Power, 50 F.3d at 329; Blum, 465 U.S. at 896 n.11.
Therefore the Court will rely on its “own expertise and judgment,” as well as other case
law, to determine the reasonableness of these rates. Davis, 526 F.2d at 868. Upon review of other

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case law, the Court believes that these rates are reasonable,2 especially given that Falick has
more than 20 years of experience. Given that they are also not contested by Plaintiffs, the Court
finds these rates are reasonable.
Hours Expended
Defendant has included extensive records of hours expended in this case, submitting that
a total of 297.75 recoverable hours were spent on this case (36.35 hours were spent in 2013,
115.25 hours were spent in 2014, and 146.15 hours were spent in 2015). (Document No. 85 at 3).
Defendant states that hours were reduced to only include work done by head counsel (Falick),
and that hours related to Defendant’s counterclaim were eliminated. Id. at 3. Furthermore,
Defendant states that these hours do not include time billed after the Court dismissed Plaintiffs’
claims on summary judgment. Id.
Although the Court granted attorneys’ fees only for Plaintiffs’ copyright claim
(Document No. 83 at 5), Defendant argues that “portions of Jacobsen’s attorney’s fees time
entries are necessarily inextricably intertwined.” (Document No. 85 at 4). The Fifth Circuit has
explained Texas law regarding the segregation of fees for work performed on different claims as
follows:
The general rule regarding the recovery of fees in Texas is that “fee claimants have
always been required to segregate fees between claims for which they are recoverable
and claims for which they are not.” Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299,
311 (Tex.2006). However, in Stewart Title Guaranty Co. v. Sterling, the Texas Supreme
Court recognized that an “exception to this duty to segregate arises when the attorney's
fees rendered are in connection with claims arising out of the same transaction and are so
2

See Miller v. Raytheon Co., 716 F.3d 138, 149 (5th Cir. 2013) (“reduced hourly rates of $577.50, $542.50, and
$280 were reasonable, customary rates”); Rouse v. Target Corp., No. 3:15-CV-48, 2016 WL 319871, at *3 (S.D.
Tex. Jan. 26, 2016) ($500 per hour rate was reasonable for partner with over 21 years of experience in labor and
employment law); Preston Expl. Co., LP v. GSP, LLC, No. CIV.A. H-08-3341, 2013 WL 3229678, at *5 (S.D. Tex.
June 25, 2013) (“$407.03/hour for partners [was] reasonable in the Houston market” for breach of contract case);
Richardson v. Tex-Tube Co., 843 F. Supp. 2d 699, 709 (S.D. Tex. 2012) ($350/hour reasonable for partner with
eighteen years of experience); Fluor Corp. v. Citadel Equity Fund Ltd., No. 3:08-CV-1556-B, 2011 WL 3820704, at
*5 (N.D. Tex. Aug. 26, 2011) (“In other cases involving Texas lawyers, the hourly rates range from $220 for
associates to $510 for senior partners.”) (citing cases).

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interrelated that their prosecution or defense entails proof or denial of essentially the
same facts.” 822 S.W.2d 1, 11 (Tex.1991) (citation and internal quotation omitted). A
party who can meet this exception is not required to segregate fees and may recover the
entire amount of fees covering all claims. Id. During the pendency of the appeal of this
case, the Sterling exception was modified as follows by Chapa: “Intertwined facts do not
make tort [attorney's] fees recoverable; it is only when discrete legal services advance
both a recoverable and unrecoverable claim that they are so intertwined that they need not
be segregated. We modify Sterling to that extent.” Chapa, 212 S.W.3d at 313–14.
Navigant Consulting, Inc. v. Wilkinson, 508 F.3d 277, 298 (5th Cir. 2007). Defendant argues that
claims against Jacobsen were all based upon the same allegation: that Jacobsen wrongfully sold
the app, and therefore “the defense of this case typically focused on the common factual issue
involving Jacobsen’s possession [and use] of the App.” (Document No. 85 at 5). The Court
agrees that these fact issues were relevant to many of the claims eventually dismissed on
summary judgment, and were therefore intertwined with the other claims to a certain extent.
However, Defendant must have spent some time on “claims that did not overlap with the
copyright infringement claims—time spent, for example, researching the elements of the claims
and drafting the portions of the motion to dismiss3 that addressed them.” Randolph v. Dimension
Films, 634 F. Supp. 2d 779, 799 (S.D. Tex. 2009) (reducing associate’s hours on this basis).
Review of Defendant’s Motions demonstrates that Defendant did take time to research other
issues not relevant to the copyright claim, particularly research on the issue of whether
conversion under Texas law applies to intangible property (Document No. 40 at 6). The Motion
for Summary Judgment also includes research on intent necessary under Texas Penal Code §
31.03, and research on the taking of a trade secret without consent required under Texas Penal
Code § 31.05. Id. at 8-10. Furthermore, some portion of time spent on other matters, such as
discovery and depositions, necessarily included some work relevant only to the non-copyright
claims. Therefore the Court finds that a twenty-hour reduction in Falick’s time is appropriate.
3

This case includes a motion to dismiss and a motion for summary judgment filed by Defendant.

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Randolph, 634 F. Supp. 2d at 799. As the bulk of the work on this case occurred in 2014 and
2015, the Court will reduce the twenty hours at Falick’s rate of $375/hour, lowering the lodestar
by $7,500, to $102,338.75.
Furthermore, some specific billing items struck the Court as irrelevant to the copyright
claims. First, Defendant review of “new patent case authority from [the] Fifth Circuit regarding
ownership issues” is not relevant to the copyright matter. (Document No. 85-2 at 3). This is one
half of a three hour billing period4; therefore the Court will remove 1.5 hours from the lodestar,
at the 2013 rate of $325/hour ($487.50). Second, research regarding “pendent state law claims”
was not relevant to the copyright matter. Id. at 6. This was also one half of a three-hour billing
period5; therefore the Court will remove 1.5 hours from the lodestar at the 2014 rate of
$375/hour ($562.50). These reductions lower the lodestar to $101,288.75.
Johnson Factors
Neither party requests an adjustment to the lodestar based upon these factors, but the
Court must still weigh the Johnson factors in determining whether the fee is reasonable. The
twelve Johnson factors are (1) the time and labor required; (2) the novelty and difficulty of the
issues; (3) the skill required to perform the legal service adequately; (4) the preclusion of other
employment by the attorney because he accepted this case; (5) the customary fee for similar
work in the community; (6) whether the fee is fixed or contingent; (7) time limitations imposed
by the client or the circumstances; (8) the amount involved and the results obtained; (9) the
experience, reputation, and ability of the attorneys; (10) the undesirability of the case; (11) the
nature and length of the professional relationship with the client; and (12) awards in similar
cases. Johnson, 488 F.2d at 717-19. However the Court will not weigh factors (2), (3), (4), (7),
4

The actual time separation between the two tasks allotted to the three-hour period is not listed. Therefore the Court
believes splitting the time in half is reasonable.
5
Same as footnote 3.

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(8), and (9) because they are presumably included in the lodestar calculation. Blum, 465 U.S. at
898-99; Shipes, 987 F.2d at 320-2; Heidtman, 171 F.3d at 1043.
(1) The amount of time and labor spent on this case was discussed above. (5) Customary
fees were discussed above. (6) The fee in this case was not contingent. (10) Defendant does not
argue that this case was undesirable. (11) Defendant does not argue that this factor is relevant.
(12) Defendant states that he is “unaware of fee awards made in similar cases.” (Document No.
85 at 11). The Court has found some cases awarding fees under §505 of the Copyright Act, but
the awards vary greatly. See, e.g., Compaq Computer Corp. v. Ergonome Inc., 387 F.3d 403,
411–12 (5th Cir. 2004) (affirming a $2,765,026.90 fee award to prevailing defendant after sevenday trial); Geophysical Servs., Inc. v. TGS-Nopec Geophysical Servs., No. CV 14-1368, 2016
WL 30294, at *7 (S.D. Tex. Jan. 4, 2016) (awarding $132,888); Randolph, 634 F. Supp. 2d at
802 (awarding $3,816.73 in attorneys' fees in case dismissed on a 12(b)(6) motion); Blackmer v.
Monarch Holdings (USA) Inc., No. CIV.A. H-00-4290, 2002 WL 32361935, at *5 (S.D. Tex.
July 11, 2002) (awarding $66,317.50 after jury trial). Therefore the Court does not find that this
factor weighs in favor of a change to the lodestar.
Conclusion
The Court hereby GRANTS Defendant’s Motion for Attorney’s Fees (Document No. 85)
and AWARDS Defendant $101,288.75 in attorney’s fees.
SIGNED at Houston, Texas, this 11th day of August, 2016.
___________________________________
MELINDA HARMON
UNITED STATES DISTRICT JUDGE

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