Earthgrains Baking Companies v. Sycamore et al

Filing 625

MEMORANDUM DECISION AND ORDER granting in part and denying in part 562 Motion for Attorney Fees: Plaintiff is awarded its reasonable attorney's fees in the amount of $711,219.45. Sycamore is responsible for 25 percent (i.e., $177,804.86) of the attorney fee award and United States Bakery is responsible for the remaining 75 percent (i.e., $533,414.59) of the attorney fee award. Signed by Judge David Nuffer on 3/5/19 (alt)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH, CENTRAL DIVISION
BIMBO BAKERIES USA, INC.,
Plaintiff,

MEMORANDUM DECISION
AND ORDER
AWARDING ATTORNEY’S FEES
Case No. 2:13-cv-00749

v.
LELAND SYCAMORE and UNITED
STATES BAKERY, INC.,

District Judge David Nuffer

Defendants.
Plaintiff Bimbo Bakeries USA, Inc. (“Bimbo Bakeries”) filed a motion seeking an award
of attorney’s fees and nontaxable costs totaling $1,231,463.29 against Defendants Leland
Sycamore (“Sycamore”) and United States Bakery, Inc. (“U.S. Bakery”) under Utah Code Ann.
§ 13-24-5. 1
Both defendants acknowledge that Bimbo Bakeries is entitled to an award of reasonable
attorney’s fees attributable to its trade secret claim. 2 However, U.S. Bakery contends that the
amount sought by Bimbo Bakeries is not reasonable because (1) Bimbo Bakeries failed to
adequately apportion its fees to only its trade secret claim; (2) Bimbo Bakeries’ attorneys
inappropriately used “block billing;” (3) Bimbo Bakeries’ out-of-state attorney billing rates are

1

Plaintiff’s Motion for Attorney’s Fees and Nontaxable Expenses (“Motion for Attorney’s Fees”), docket no. 562,
filed Apr. 30, 2018. See also Plaintiff’s Reply in Support of Motion for Attorney’s Fees and Nontaxable Expenses
(“Bimbo Bakeries’ Reply”), docket no. 599, filed May 29, 2018.
2

Memorandum Decision and Order Granting in Part [481] Plaintiff’s Motion for Enhanced Damages and Attorneys’
Fees and Granting [483] Plaintiff’s Motion for Permanent Injunction at 8, docket no. 534, entered Mar. 29, 2018;
Judgment in a Civil Case, docket no. 537, entered Mar. 29, 2018.

excessive; and (4) fees requested include time that is inadequately supported. 3 U.S. Bakery also
contests any award of non-taxable costs, including expert fees. 4
Sycamore does not object to the amount of fees and costs claimed to have been incurred
by Bimbo Bakeries, but instead argues that the fees and costs assessed against Sycamore should
be limited to those incurred by Bimbo Bakeries in connection with proving its claims against
Sycamore alone. 5 For the reasons discussed below, Bimbo Bakeries’ Motion for Attorney’s
Fees 6 is granted in part and denied in part.
Contents
Standard .......................................................................................................................................... 2
Discussion ....................................................................................................................................... 3
Bimbo Bakeries is entitled to an award of attorney’s fees based upon local counsel’s
billing rates.............................................................................................................. 3
Bimbo Bakeries is awarded its reasonable incidental and necessary expenses as part of its
attorney fee award. .................................................................................................. 6
The attorney fee award should be apportioned between the defendants based upon the
jury’s finding of fault. ............................................................................................. 8
Order….. ......................................................................................................................................... 9
STANDARD
“An award of attorneys’ fees is a matter uniquely within the discretion of the trial judge
who ‘has intimate knowledge of the efforts expended and the value of the services rendered.’” 7
To determine the reasonableness of a fee request, a court must begin by calculating the so-called
‘lodestar amount’ of a fee, and a claimant is entitled to the presumption that this lodestar amount

3

Defendant United States Bakery’s Opposition to Plaintiff’s Motion for Attorney Fees and Nontaxable Expenses
(“U.S. Bakery’s Opposition”), docket no. 590, filed May 14, 2018.

4

Id.

5

Sycamore’s Objection to Bimbo’s Request for Fees and Costs (“Sycamore’s Objection”), docket no. 589, filed
May 14, 2018.
6

Docket no. 562.

7
Brown v. Phillips Petroleum Co., 838 F.2d 451, 453 (10th Cir. 1988) (quoting United States v. Anglin & Stevenson,
145 F.2d 622, 630 (10th Cir. 1944), cert denied, 324 U.S. 844 (1945)).

2

reflects a ‘reasonable’ fee.” 8 “The lodestar calculation is the product of the number of attorney
hours ‘reasonably expended’ and a ‘reasonable hourly rate.’” 9 The “determination of fees should
not result in a second major litigation.” 10 The goal is to “do rough justice, not to achieve auditing
perfection.” 11 Accordingly, “trial courts may take into account their overall sense of a suit, and
may use estimates in calculating and allocating an attorney’s time.” 12
DISCUSSION
Bimbo Bakeries is entitled to an award of attorney’s fees
based upon local counsel’s billing rates.
Bimbo Bakeries states that its reasonable and compensable attorney’s fees attributable to
its trade secret claim are $821,712.50. 13 This amount includes work performed by out-of-state
counsel and local counsel. 14 Bimbo Bakeries and U.S. Bakery disagree over the reasonableness
of the fees charged by out-of-state counsel. 15 U.S. Bakery also argues that Bimbo Bakeries
improperly included fees attributable to other claims, block billing entries, and other
inadequately supported time, including some support staff fees.

8

Robinson v. City of Edmond, 160 F.3d 1275, 1281 (10th Cir. 1998) (citing Pennsylvania v. Delaware Valley
Citizens' Council for Clean Air, 478 U.S. 546, 563–65 (1986).

9

Case v. Unified Sch. Dist. No. 233, Johnson Cty., Kan., 157 F.3d 1243, 1249 (10th Cir. 1998) (quoting Hensley v.
Eckerhart, 461 U.S. 424, 433 (1982)).

10

Fox v. Vice, 563 U.S. 826 (2011).

11

Id.

12

Id.

13

Docket no. 562 at 3.

14

Of the amount sought, $731,154.18 is attributable to work performed by out-of-state counsel, Womble Bond
Dickinson (“Womble”). Declaration of Charles A. Burke In Support of Plaintiff’s Motion for Attorney’s Fees and
Nontaxable Expenses (“Declaration of Charles Burke”) ¶ 3, docket no. 563. The remaining $90,558.32 is for work
performed by local counsel, Parsons Behle & Latimer (“Parsons”). Declaration of Juliette P. White In Support of
Plaintiff’s Motion for Attorney’s Fees and Nontaxable Expenses (“Declaration of Juliette White”) ¶ 3, docket no.
564, filed Apr. 30, 2018.
15

Compare Declaration of Samuel C. Straight in Support of Plaintiff’s Motion for Attorney’s Fees, docket no. 565,
filed Apr. 30, 2018 with Declaration of Matthew A. Barlow in Support of United States Bakery’s Opposition to
Plaintiff’s Motion for Attorney Fees and Nontaxable Costs, docket no. 591, filed May 14, 2018.

3

This case involved complex claims, extensive discovery, multiple dispositive motions,
several experts, and a two-week jury trial. In support of the fees requested, Bimbo Bakeries
submitted the invoices that were sent to Bimbo Bakeries by its attorneys. These invoices identify
the scope of the work performed, the number of hours expended, and the hourly rates claimed.
Bimbo Bakeries also explained its process for apportioning the fees to its trade secret claim:
a. If a fee entry solely involved trade secret subject matter, then 100% of that fee
entry was allocated to the trade secret misappropriation claim.
b. If a fee entry partially involved trade secret subject matter, and partially a
different cause of action, then only a portion of that fee entry was allocated to the
trade secret misappropriation claim. The portion of each fee entry that was
allocated to the trade secret claim involved a judgment call based upon my
experience as lead counsel in this action.
c. If a fee entry involved subject matter that was not specific to any particular
cause of action but to the pursuit of this litigation in general, then one-half of that
entry was counted as relating to the trade secret misappropriation claim prior to
October 20, 2014, when Bimbo Bakeries’ began to prepare its motion to amend to
add the false advertising claim, and one-third thereafter until June 5, 2017, when
the Court dismissed the trade dress claim at summary judgment. After June 5,
2017, one-half of nonspecific fee entries were counted to the trade secret
misappropriation claim. In sum, non-claim-specific fee entries were allocated to
the trade secret claim as follows: (a) May 20, 2013 – October 19, 2014 (onehalf); (b) October 20, 2014 – June 5, 2017 (one-third); June 6, 2017 – forward
(one-half). 16
A claimant “need not segregate its compensable and noncompensable claims if they
sufficiently overlap and involve the same nucleus of facts.” 17 Given the complexity of the issues
involved in this case and the overlapping nature of some of the claims, the approach taken by
Bimbo Bakeries to apportion its attorney’s fees is reasonable. 18 Additionally, block billing does

16

Declaration of Charles Burke at 4; Declaration of Juliette White at 4.

17
First Am. Title Insurance Co. v. Northwest Title Insurance Agency, No. 2:15-cv-00229, 2017 WL 1456460, at *12
(D. Utah Apr. 24, 2017) (quoting Daynight, LLC v. Mobilight, Inc., 248 P.3d 1010, 1013 (Utah Ct. App. 2011)).
18

Notably, Bimbo Bakeries incurred a total of $1,793,306.50 in fees billed by Womble alone.18 U.S. Bakery at 7;
Declaration of Steven M. Wilker, Ex. 1. The fees sought by Bimbo Bakeries in relation to its trade secret claim
represent approximately 40% of the total fees incurred.

4

not necessarily preclude an award of attorney’s fees. 19 In this case, Plaintiffs billing records do
not include suspect entries. The amount of time spent in the largest time entries seem to be
warranted by the underlying task—e.g., research and writing a brief. Therefore, no reduction in
fees is required due to block billing.
Finally, U.S. Bakery objects to the inclusion of time entries for two paralegals to attend
trial. 20 Paraprofessional fees may be properly included as an element of attorney’s fees when it
promotes lawyer efficiency and decreased client litigation costs. 21 Trial in this matter occurred
over the course of two weeks and involved a substantial number of witnesses and exhibits. It was
not unreasonable to have two support paralegals assist at trial. Experience in court confirms that
they are best suited to manage evidence and witnesses and use trial presentation technology,
along with their general duties. Overall, the paraprofessional fees that Bimbo Bakeries seeks as
part of its attorney’s fee award are reasonable and sufficiently supported by the invoices
submitted.
Based upon the evidence presented, the number of hours claimed are reasonable.
However, an adjustment is still necessary to address the reasonableness of the rates billed.
Generally, fees awarded should be consistent with the rates customarily charged in the locality
for the similar service. 22 Parsons Behle Latimer (“Parsons”) attorneys’ billing rate is consistent
with the rates customarily charged in Utah. However, the rates charged by attorneys at Womble
Bond Dickinson, Burke, Mason, and Sharpe (“Womble”) are approximately 10-20% greater than

19

EarthGrains Baking Co., Inc. v. Sycamore Family Bakery, Inc., No. 2:09-cv-523, 2012 WL 6553739, at *3 (D.
Utah Dec. 14, 2012) (citing Flying J Inc. v. TCH, LLC, 322 F. App’x 610, 617 (10th Cir. 2009); Cadena v. The
Pacesetter Corp., 224 F.3d 1203, 1215 (10th Cir. 2000) (“This court has not established a rule mandating reduction
or denial of a fee request if the prevailing party submits attorney records which reflect block billing.”).
20

U.S. Bakery’s Opposition at 7-8.

21

First Am. Title, 2017 WL 1456460, at *13 (quoting Baldwin v. Burton, 850 P.2d 1188, 1200 (Utah 1993)).

22

Dixie State Bank v. Bracken, 764 P.2d 985, 989 (Utah 1998).

5

a comparable attorney at Parsons. As part of their opposition, U.S. Bakery prepared a
comprehensive spreadsheet identifying the rates claimed by Womble, the number of hours billed,
and the dollar amount billed by each attorney. 23 U.S. Bakery further proposed an adjusted
billing rate for the majority of Womble’s attorneys based upon the rates billed by an attorney at
Parsons with comparable experience. In order to conform Womble’s rates to the rates charged by
a prominent Utah firm, U.S. Bakery requests that Bimbo Bakeries’ attorney’s fees be reduced by
$178,962.50. This reduction is appropriate and supported by the materials submitted by U.S.
Bakery. Accordingly, Bimbo Bakeries is awarded $642,750 in attorney’s fees. 24
Bimbo Bakeries is awarded its reasonable incidental and necessary expenses as part of its
attorney fee award.
In addition to attorney’s fees, Bimbo Bakeries seeks significant nontaxable expenses,
totaling $409,751.19. 25 These expenses include the following: 26
Womble Bond Dickinson
Travel
Expert Services

$ 55,647.23
$ 341,281.75

Mail/Delivery

$ 683.99

Research

Parsons Behle Latimer
Mail/Delivery
Research

$ 5,362.83

$ 794.98

Miscellaneous
Total
TOTAL

Miscellaneous

$ 252.62
$ 339.51

$ 5,388.28
$ 403,796.20

Total

$ 5,954.96

$409,751.19

23
Declaration of Steven M. Wilker in Support of United States Bakery’s Opposition to Plaintiff’s Motion for
Attorney Fees and Nontaxable Expenses, docket no. 592-1, filed May 14, 2018.
24

The amount of attorney’s fees requested by Bimbo Bakeries ($821,712.50) minus $178,962.50 is 642,750.00.

25

This amount seems to be correct based upon the itemized accounting provided by Bimbo Bakeries, as opposed to
the $409,750.79 stated in the Motion for Attorney Fees.
26

Docket no. 562 at 3-4. See also Declaration of Charles Burke ¶ 4; Declaration of Juliette White ¶ 4.

6

Neither the court’s order on the post-verdict motions nor the judgment entered expressly
included an award of nontaxable costs. 27 However, as part of an award of attorney’s fees, the
court may award “incidental and necessary expenses incurred in furnishing effective and
competent representation.” 28 These expenses should be awarded in the court’s discretion if “(1)
the expenses are not absorbed as part of a law firm overhead but are normally billed to a private
client, and (2) the expenses are reasonable.” 29 Therefore, Bimbo Bakeries is awarded an
additional $68,469.45 for the reasonable out-of-pocket expenses incurred by its counsel in
litigating this matter (i.e., travel, mail/delivery, research, and miscellaneous).
However, Bimbo Bakeries is not entitled to an award of other, non-taxable expenses. The
Utah Uniform Trade Secrets Act (UUTSA)—the relevant statute here—does not provide for an
award of nontaxable costs, such as expert witness fees. 30 “The court may, however, award nontaxable costs by exercising the court's inherent authority [to sanction bad conduct].” 31 To do so,
the court must find that the party against whom the costs are imposed engaged in bad faith. 32
This finding cannot be made here. Although U.S. Bakery and Bimbo Bakeries defended their
position through post-trial proceedings, they did not engage in improper litigation tactics or
behave contemptuously toward the court or other parties. 33

27

Docket 534; docket 537.

28

Storeagecraft Tech. Corp. v. Kirby, No. 2:08-cv-921, 2012 WL 4467520, at *1 (D. Utah Sept. 27, 2012) (citing
Brown v. Gray, 227 F.3d 1278, 1297 (10th Cir. 2000). United Phosphorus, Ltd. v. Midland Fumigrant, Inc., 21 F.
Supp. 3d 1255, 1262 (D. Kan. 1998) (citing Jane L. v. Bangerter, 61 F.3d 1505, 1517 (10th Cir. 1995)).
29

United Phosphorus, 21 F. Supp. 2d at 1262 (citing Jane L. v. Bangerter, 61 F.3d 1505, 1517 (10th Cir. 1995)).

30
Utah Code Ann. § 13-24-5. ClearOne Commc’ns, Inc. v. Chiang, 2:07-cv-37, 2010 WL 1257750, at *8 (D. Utah
Mar. 25, 2010), aff'd sub nom. ClearOne Commc’ns, Inc. v. Bowers, 643 F.3d 735 (10th Cir. 2011) (“Non-taxable
costs, such as ClearOne’s expert fees, are not recoverable under the UUTSA.”).
31

ClearOne Commc’ns, Inc. v. Chiang, 2010 WL 1257750, at *8.

32

Id.

33

Id.

7

The attorney fee award should be apportioned between the defendants
based upon the jury’s finding of fault.
Sycamore argues that the amount of hours Bimbo Bakeries spent on the case in
connection with Sycamore was a small fraction compared to the total amount of work Bimbo’s
attorneys performed. 34 Sycamore further contends that none of the costs Bimbo Bakeries seeks to
recover can be reasonably attributed to the claims brought against Sycamore, as opposed to U.S.
Bakery. 35 However, as recognized by Bimbo Bakeries in their reply, 36 Sycamore’s wrongful acts
were at the core of Bimbo Bakeries’ case and there is significant overlap between the work
performed on claims common to Sycamore and U.S. Bakery.
The jury found that both U.S. Bakery and Sycamore misappropriated Bimbo Bakeries’
trade secret. 37 The jury set $2,105,256 in compensatory damages, allocating 25% fault to
Sycamore and 75% fault to U.S. Bakery. 38 The UUTSA provides that exemplary damages and
attorneys’ fees may be awarded if “willful and malicious” misappropriation is shown. 39 The jury
found that U.S. Bakery and Sycamore both committed “willful and malicious” misappropriation.
Accordingly, the attorney’s fees should be allocated among the defendants consistent with the
jury’s finding of fault. Sycamore is responsible for 25% (i.e., $177,804.86) of the attorney fee
award and U.S. Bakery is responsible for the remaining 75% (i.e., $533,414.59) of the attorney
fee award.

34

Sycamore’s Objection at 3.

35

Id. at 5.

36

Plaintiff’s Reply in Support of Motion for Attorney’s Fees and Nontaxable Expenses, docket no. 600, filed May
29, 2018.
37

Special Verdict at 2 (Question 2).

38

Special Verdict at 3.

39

Utah Code § 13-24-4, -5.

8

ORDER
IT IS HEREBY ORDERED that Bimbo Bakeries’ Motion for Attorney’s Fees 40 is
GRANTED IN PART and DENIED IN PART. Bimbo Bakeries is awarded its reasonable
attorney’s fees in the amount of $711,219.45. Sycamore is responsible for 25% (i.e.,
$177,804.86) of the attorney fee award and U.S. Bakery is responsible for the remaining 75%
(i.e., $533,414.59) of the attorney fee award.
Dated March 5, 2019.
BY THE COURT:
____________________________
David Nuffer
United States District Judge

40

Docket no. 562.

9