Brownmark Films, LLC v. Paramount Pictures Corporation et al
ORDER signed by Judge J P Stadtmueller on 11/30/11 granting 34 defendants' Motion for Attorney's Fees and Costs; the plaintiff shall submit an affidavit detailing its financial status and an accompanying brief, which shall not exceed 3 pages, by 12/20/11; and, the defendants may submit a responsive brief, which shall not exceed 3 pages, by 12/30/11- if the defendants do not wish to file a responsive brief, they shall submit documentation to the Court notifying it of such decision. See Order. (cc: all counsel)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
BROWNMARK FILMS LLC,
Case No. 10-CV-1013-JPS
CORPORATION, SOUTH PARK
DIGITAL STUDIOS LLC, and
VIACOM INTERNATIONAL INC.,
On July 6, 2011, this Court dismissed Brownmark Films’ suit with
prejudice. (Docket #23). Brownmark has since appealed that decision.
However, the issue of attorney fees and costs still remains with this
Court for decision. The parties have filed numerous documents on this issue.
Aside from the standard issues of attorney fees and costs, the parties’ filings
also raise several procedural issues. After recounting the case background,
the Court must dispense with those procedural issues first. The Court will
then turn to the issue of attorney fees and costs, ultimately granting the
defendants’ motions for costs and fees.
Brownmark initiated this suit in November 2010, alleging willful
copyright violation by the defendants. Brownmark sought: (1) statutory
damages; (2) a declaration that the defendants willfully, both directly and
secondarily, infringed upon Brownmark’s copyrights; (3) an injunction
requiring the defendants to cease any direct or indirect infringement; and (4)
further relief, including attorneys’ fees and pre- and post-judgment interest.
Rather than submit an answer, on February 22, 2011, defendants filed
a motion to dismiss. (Docket #8). After Brownmark’s response and the
defendants’ reply were filed, the Court granted the defendants’ motion.
(Docket #16, #22, #23). On July 6, 2011, the Court dismissed all of
Brownmark’s claims, finding that the defendants’ actions were protected as
fair use. (Docket #23). Brownmark has appealed this decision to the United
States Court of Appeals for the Seventh Circuit. (Docket #26–#30).
The defendants, as prevailing parties in the District Court, then filed
the present motion seeking attorney fees and costs. (Docket #34). The issue
has now been fully briefed. (Docket #34–#42). To provide an adequate basis
on which to decide this issue, the Court will first set forth the factual basis for
Brownmark’s suit, as well as the procedural posture of this case.
Brownmark’s Copyright Claims
Brownmark is a purported co-owner of a copyright in the “What What
(In the Butt)” music video (“WWITB”). (Am. Compl. ¶¶ 11-13). The video
features a male vocalist repeatedly singing the title of the video and several
derivations thereof accompanied by a series of surreal images. Perhaps
unsurprisingly, the video went “viral,” and currently has over 43 million
views on Youtube.1
Shortly thereafter, the defendants aired an episode of the television
series South Park, titled “Canada on Strike,” in which one of the show’s
Samwell, “What What (In the Butt).” Uploaded Feb. 14, 2007, by
Brownmark Films. Available at: http://www.youtube.com/watch?v=fbGkxcY7YFU.
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characters creates a video that is very similar to Brownmark’s original
WWITB video. (Am. Compl. ¶ 14). In the South Park version, which lasts
fifty-eight seconds, the South Park character sings many of the same lyrics as
are featured in the original WWITB video; the South Park version also
features surreal imagery, similar to that in the original. (Id.). In the
episode—much like in reality for Brownmark—the character’s video becomes
a viral hit. (Id.). However, much to the chagrin of the South Park
characters—and in a result that may mirror reality a bit too closely for
Brownmark—there are no riches of “internet money” to be had, despite the
popularity of their work. In a classic bit of art imitating and commenting
upon life, the South Park characters learn that it is difficult to convert viral
internet fame into real money; Brownmark’s proprietors have undoubtedly
learned much the same.
As mentioned above, Brownmark filed this case in November of 2010,
after which time they filed an amended complaint in January of 2011. (Docket
#1, # 6).
In February 2011, the defendants filed a motion to dismiss. (Docket
#8). In their brief in support of that motion, the defendants argued that
Brownmark lacked standing to prosecute the action. (Def.’s Br. in Supp.,
9–10). The defendants also argued that the South Park replica was parody,
and thus protected as fair use. (Def.’s Br. in Supp., at 10–21).
Brownmark filed their response in March of 2011, arguing that they
had standing to sue and also that the defendants’ Motion to Dismiss was
improper, due to its being based on an affirmative defense. (Pl.’s Resp., 1–5).
Brownmark’s response was devoted primarily to the latter point, and did not
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directly respond to the defendants’ claims of fair use. (Pl.’s Resp., at 3–5). The
defendants then took these arguments up in their reply brief, urging the
Court to decide the fair use issue at the pleading stage.
The Court did just that in its July 6, 2011 order. After finding that
Brownmark had standing to sue, the Court addressed the separate
procedural and substantive issues of the defendants’ fair use argument. On
the procedural side of the issue, the Court held that it could address the
defendants’ affirmative defense of fair use at the pleading stage, because
Brownmark’s complaint and centrally-related materials “set forth everything
necessary to satisfy the affirmative defense.” (Order Granting Mot. Dismiss,
13 (quoting Brooks v. Ross, 578 F.3d 574, 579 (7th Cir. 2009))). The Court noted
that the evaluation of an affirmative defense at the pleading stage is
“‘irregular.’” (Id., at 14 (quoting Chicago Bd. of Educ. v. Substance, Inc., 354 F.3d
624, 627 (7th Cir. 2003))). But, in the end, the Court decided to address the
issue, concluding that the dispute “‘simply does not warrant putting the
defendant through the expense of discovery,’” when considering that the
entire dispute between the parties could be solved much more efficiently by
resolving the substantive underlying issue at the pleading stage. (Order
Granting Mot. Dismiss, 14 (quoting Atkins v. City of Chicago, 631 F.3d 823, 832
(7th Cir. 2011))).
Thus, the Court turned to the substantive fair use issue, and concluded
that the case should be dismissed at the pleading stage, because the
defendants’ work is entitled to fair use protection. (Order Granting Mot.
Dismiss, 19). In reaching its decision, the Court found that the factors of fair
use weighed in favor of the defendants: (1) the “purpose and character” of
the South Park replica was both a parody and also transformative of the
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original; (2) the nature of the copyrighted work—while copied in some
ways—was of little help to the Court, because the South Park version was a
parody, the nature of which practically requires the copying of a publiclyknown work; (3) the South Park version, in fact, used relatively little of the
original copyrighted work, and did not mirror the original; and (4) the South
Park version is unlikely to usurp any of the market demand for the original.
(Id., at 17–19).
For those reasons, the Court held that the defendants’ use was fair.
(Ord. Granting Mot. Dismiss, at 19). Thus, their work was protected by that
affirmative defense, and the Court dismissed Brownmark’s claims with
prejudice. (Ord. Granting Mot. Dismiss, at 20). Brownmark has appealed the
Court’s decision to the United States Court of Appeals for the Seventh
Circuit. (Docket # 26–30).
Meanwhile, the defendants’ Motion for Attorney Fees and Costs still
remains before this Court. (Docket #34). On August 3, 2011, Brownmark filed
both a request for adversary submissions and its response to the defendants’
motion on the fees and costs issue. (Docket #36, #37). The defendants then
filed their reply brief, on August 17, 2011. (Docket #38). Afterward, on
August 23, 2011, Brownmark submitted a flurry of documents: two motions
and a reply, all of which are related to the issue of attorney fees. (Docket #39,
#40, #41). Finally, on August 30, 2011, the defendants submitted a brief
opposing Brownmark’s three August 23, 2011 filings. (Docket #42).
By order, on September 27, 2011, the Court struck what it deemed to
be an unauthorized sur-reply brief submitted by Brownmark. (Docket #43).
The Court also ordered that the parties submit briefs addressing the
defendants’ objections to several pieces of evidence submitted by
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Brownmark in support of their opposition to defendants’ request for
attorneys’ fees. (Docket #43).
In order that it can make its fees decision on the appropriate record,
the Court will first resolve the defendants’ objections to the evidence
submitted by Brownmark. After addressing those objections, the Court will
move to the defendants’ motion for attorneys’ fees.
Defendants’ Evidentiary Objections
On August 23, 2011, Brownmark filed three separate documents. The
Court has already addressed one of those documents: Brownmark’s
unauthorized sur-reply brief. (See Docket #43 (disregarding Docket #41)). As
discussed above, by its September 27, 2011 order, the Court effectively struck
Brownmark’s unauthorized sur-reply. (Docket #43). By the same order, the
Court also requested that the parties brief the issue of the defendants’
objections to several of Brownmark’s evidentiary submissions. (Docket #43).
Having received the parties’ briefs, the Court will now address that issue.
The defendants argue that the Court should strike portions of
declarations submitted by Brownmark’s attorneys, Caz McChrystal
(“McChrystal”) and Bobby Ciraldo (“Ciraldo”). (Docket #44: Def.’s Mem. in
Supp. Obj. Ev. at 1). Specifically, with regards to the McChrystal declaration,
the defendants object to the fact that McChrystal included legal analysis and
conclusions in his declaration, as support for Brownmark’s contention that
their position was reasonable.
The Court agrees and will, therefore, strike paragraphs five through
twenty-six of McChrystal’s declaration. Those paragraphs are replete with
legal conclusions and references to case law, all of which appear to be
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intended to bolster Brownmark’s legal argument that their position was
reasonable. (McChrystal Decl. ¶¶ 5–26). While the Court understands
McChrystal’s desire to set forth facts that establish his reliance on case law,
the Court believes that statements like McChrystal’s are much better suited
to a legal brief. In fact, if McChrystal merely relied on his statements to
establish the fact that he relied on certain cases or statutes, the Court would
be inclined to allow his declaration to stand. But, instead, in his declaration,
McChrystal goes so far as to address arguments made by the defendant (see,
e.g., McChrystal Decl. ¶ 7, 14), apply the fair use factors and case law to
Brownmark’s claim (see, e.g., McChrystal Decl. ¶¶ 12, 13, 20, 23), and make
further legal accusations against the defendants (see, e.g., McChrystal Decl.
¶ 15 (“the Defendants did not more than use the WWITB video in a
humorous fashion to poke fun at the viral video phenomenon, Internet
celebrity, and …[the] musical composition”), ¶ 18 (“the Defendants’ use of
the WWITB video is not of a strong transformative nature”). He does all of
this without ever making a prefatory statement that he is merely establishing
the fact that he researched and relied upon the cited arguments and cases in
reaching a decision to bring a claim.
Therefore, the Court agrees with the defendants, and finds that
paragraphs five through twenty-six of McChrystal’s declaration contain
improper legal conclusions and argumentation that are impermissible in an
declaration. (Def.’s Mot. in Supp. Obj. Ev. 2–3 (citing Chen v. Mayflower
Transit, 315 F. Supp. 2d 886, 923 (N.D. Ill. 2004), Vasquez v. Central States Joint
Board, 2006 U.S. Dist. LEXIS 11355, at *31–*32 (N.D. Ill. March 15, 2006))). As
such, the Court is obliged to strike paragraphs five through twenty-six of
McChrystal’s declaration. (Docket #37, Ex. A).
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The Court next turns to the defendants’ objections to Ciraldo’s
declaration. The defendants object on multiple grounds, and the Court will
address each objection by the defendants’ legal argument against it: first,
hearsay; second, best evidence rule; third, relevance; fourth speculation; and,
fifth, defendants’ specific argument against Ciraldo’s side-by-side
comparison of the WWITB with South Park’s version.
First, with relation to defendants’ hearsay objections, the Court will
not strike Ciraldo’s statements. Brownmark argues that each of the
statements to which the defendants object are asserted to show that
Brownmark filed its suit as a result of its belief that an active market existed
for its work, leading Brownmark to its conclusion that it had not received fair
compensation for the defendants’ use of the WWITB video. (Pl. Resp. Obj. Ev.
6). That fact, Brownmark asserts, shows that it did not have an improper
motive for filing the case. (Pl. Resp. Obj. Ev. 6). The Court agrees: Ciraldo’s
declaration references statements of others that show specific instances of
other attempts or interest in licensing the WWITB video. But, Brownmark is
not relying on those statements to show that specific parties had made
requests to license the WWITB video; rather, Brownmark uses Ciraldo’s
statements to show a general demand in the market and that Brownmark
had a proper motive to bring this suit. As such, the Court will not strike
paragraphs six, seven, eleven, fourteen, or sixteen, as being improper
Second, the Court turns to the defendants’ best evidence rule
objections to paragraphs six, seven, eight, ten, twelve, sixteen, and eighteen;
the Court overrules those objections, as well. The best evidence rule requires
that original versions of documents be submitted if the contents of those
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documents are being admitted. See Fed. R. Ev. 1002, 1004. The defendants’
objections hit a snag due to the fact that Brownmark does not rely on the
contents of the documents it discusses, but, as above, discusses those
documents in arguing that an active market existed for the WWITB video.
Therefore, the lack of original documents does not create best evidence rule
Third, the Court addresses the defendants’ relevance objections to
paragraphs six, seven, and eleven. (Def. Mem. Supp. Obj. Ev. 6). The
defendants argue that licensing agreements with outside parties are
irrelevant, but the Court disagrees. A portion of the inquiry into whether to
award attorneys’ fees requires the Court to consider whether Brownmark
acted reasonably in brining this suit. As already discussed, evidence of an
active market may factor into the Court’s determination as to whether it was
reasonable for Brownmark to bring this suit. As such, the Court finds
paragraphs six, seven, and eleven relevant to the issue at hand, and will not
strike those portions of Ciraldo’s declaration.
Fourth, the Court examines and agrees with Brownmark’s argument
that the defendants placed Brownmark’s subjective motivations at issue and,
thus, the personal beliefs of Ciraldo is admissible. (Pl. Resp. Obj. Ev. 8–9). The
defendants have argued that Brownmark’s motivation is “questionable” (Def.
Mem. Atty. Fee 9–10); as such, Ciraldo’s statements regarding his personal
beliefs should be admitted as probative of his motivation as a member of
Brownmark. While the Court will treat those statements cautiously, as
Ciraldo’s credibility may be questioned as an interested party, the Court will
not strike them.
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Finally, with regard to the defendants’ Miracle Blade argument that
Ciraldo’s side-by-side comparison of the two works in question (Ciraldo
Decl. ¶ 35, App. 1), the Court finds no reason to strike Ciraldo’s comparison.
In that case, the court objected to—but ultimately admitted—a summary
comparison between two works. Miracle Blade, LLC v. Ebrands Commerce
group, LLC, 207 F. Supp. 2d 1136, 1145–1146 (D. Nev. 2002). But, there, the
court’s objection to the summary was that the defendants had not complied
with Rule 1006 of the Federal Rules of Evidence by submitting a copy to the
other party prior to its admission. Id., at 1146. The Court ultimately admitted
the summary, though, because the plaintiff had “sufficient opportunity and
notice to attempt to retrieve [the] materials.” Id. The only portion of the
summary that the court in that case struck was a legal conclusion stated by
the declarant. Id., at 1145 (stating that the summary “clearly shows that there
is no copyright infringement”).
Miracle Blade does not require that the Court strike Ciraldo’s side-byside summary comparison. To begin, the defendants have not argued that
any of Ciraldo’s comparison reaches an improper legal conclusion. Further,
the defendants have not made a Rule 1006 objection to the comparison,
which would seem to be the proposition for which Miracle Blade stands most
strongly. See id., at 1146. Even so, the Court sides with the Miracle Blade
decision, finding that—even if there were a Rule 1006 problem—the
defendants have viewed and acknowledged the similarities between the two
videos on multiple occasions. In fact, the similarities between the videos is
at the heart of this lawsuit. A summary of the similarities does not disservice
the defendants and, therefore, the Court will not strike Ciraldo’s side-by-side
comparison. (Ciraldo Decl., App. 1).
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To summarize, the Court strikes paragraphs five through twenty-six
of McChrystal’s declaration, but leaves Ciraldo’s declaration fully intact.
Defendants’ Entitlement to Attorneys’ Fees and Costs
Having decided the record upon which to determine the issue of
attorneys’ fees, the Court now turns its attention to that matter.
The Copyright Act grants courts discretion to award reasonable
attorneys’ fees and costs to prevailing parties in civil copyright actions.
17 U.S.C. § 505. In determining whether to exercise that discretion and award
costs and fees, the Court may look to a number of nonexclusive factors
accepted by the Supreme Court: (1) the objective unreasonableness of the
action; (2) the losing party’s motivations for filing or contesting the action; (3)
the frivolousness of the action; and (4) the need to “advance considerations
of compensation and deterrence.” Fogerty v. Fantasy, Inc., 510 U.S. 517, 535
n. 19 (1994) (quoting Lieb v. Topstone Industries, Inc., 788 F.2d 151, 156 (3rd Cir.
1986) (internal quotations omitted)).
The Seventh Circuit has refined this standard further. According to the
Seventh Circuit, the “two most important [of these] considerations…are the
strength of the prevailing party’s case and the amount of damages or other
relief the party obtained.” Assessment Techs. of Wisconsin, LLC v. Wire Data,
Inc., 361 F.3d 434, 436 (7th Cir. 2004). Furthermore, the Seventh Circuit has
specifically noted that, while “prevailing plaintiffs and prevailing defendants
are to be treated alike,” the presumption in favor of awarding fees to a
prevailing defendant is “very strong.” Id., at 436–37 (refining Fantasy, 510
U.S. at 534; citing Diamonds Star Building Corp. v. Freed, 30 F.3d 536, 506 (4th
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Applying the factors discussed by the Supreme Court, taken in
conjunction with the Seventh Circuit’s presumption in favor of prevailing
defendants, the Court finds that the defendants’ are entitled to attorneys’ fees
To begin, the defendants’ fair-use argument was very strong, and
Brownmark’s legal position was objectively unreasonable. The Court took
the somewhat rare step of deciding this case at the motion to dismiss stage,
precisely because the defendants’ fair-use defense was so strong, satisfying
all four fair-use factors. First, the Court found that South Park’s work was a
“clear” parody, which one could gather quickly and easily from watching the
episode. Second, South Park’s version of the video was transformative, using
the series’ own characters and a different recording of the song, even if the
words and images were similar. Third, even with those similarities, South
Park made many changes to the form of the original and used only enough
lines to conjure up the original. South Park’s use was insubstantial. And,
fourth, the Court found that South Park’s version of the video would not
usurp the market for Brownmark’s original. In fact, in this respect, it is most
likely that South Park’s use would have spurred demand for the original,
making the viral video’s spread more rapid after its exposure to a national
television audience. The satisfaction of these factors shows that the
defendants’ case was very strong.
Inquiring further, the Court finds that Brownmark’s legal positions
were also objectively unreasonable, and thus their position was frivolous. To
this Court, there is little that could justify the plaintiff’s stated view that the
South Park version was not parody. Brownmark argues that South Park’s
clip could be viewed as satire, and would thus require a heightened amount
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of transformation to be a fair use. (See Pl.’s Resp. Atty. Fee 8–9 (citing
Campbell v. Acuff-Rose Music, 510 U.S. 569, 580 (1994))). This argument fails
for two reasons. Not only was South Park’s video a parody, but South Park
substantially transformed its version from the original. South Park did not
directly copy Brownmark’s original video and insert it into the episode;2
rather, South Park created a video that purposefully mocked the obscure
images and song of the original, all in an attempt to poke fun at the original,
its viral popularity, and internet crazes as a whole. It may have been
intended partially as satire, but also clearly encompassed elements of parody.
And, further, given the transformative nature of the use and the lampooning
Brownmark’s original received, there is ample reason to believe that South
Park’s use would have greater spurred the market for the original. In the
internet era, with information freely and quickly accessible, viewers
interested in South Park’s version could turn to the internet to find a copy of
the original. And any confusion over which version was the original could
be supplied to online viewers through a statement at the video’s web page.
For all of these reasons, the Court finds that Brownmark was objectively
unreasonable in its position that South Park’s use was not fair.
Brownmark argues that the defendants’ produced a “near-verbatim copy,
merely compressed in time and swapping out the original singer for a different
one.” The Court would add that these changes are substantial. While the words
may be practically verbatim, there are few words to begin with. Further,
particularly important in the eyes of the Court is the fact that the different singer
is a very young cartoon character. These two major differences change the nature
of the video, from one that is patently absurd, to one that parodies the original by
creating an even more absurd product. Despite any shot-for-shot similarities, as has
been catalogued by Ciraldo (Ciraldo Decl., App. 1), the Court finds that these
changes make the use very transformative.
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Further, the Court is convinced that Brownmark’s motivation in filing
this suit was questionable. Not only was Brownmark’s position
unreasonable, but it also waited nearly two years to file a lawsuit, only after
being repeatedly rejected with warnings that South Park’s use was
copyrighted. (Docket #34, Ex. B). This demonstrates an attempt by
Brownmark to use the threat of litigation against the defendants as a sort of
“sword of Damocles”—hanging by a thread over the heads of the defendants
while Brownmark attempted to extract a licensing fee. Of course, when the
thread finally snapped and Brownmark brought this action, the parties
quickly found the “sword” to be nothing more than a flimsy replica, as the
Court dismissed the case outright at its earliest stage.
Next, the Court also must note that an award of attorneys’ fees in this
case will deter future actions by those similar to Brownmark; the Court is not
entirely comfortable with this fact, though. The defendants in this case are
sophisticated business entities with worldwide connections. Brownmark, on
the other hand, is a very small company which can hardly bear the same
costs as the defendants. Therefore, the Court must walk a fine line between
one side of protecting the rights of defendants to parody others’ works
without being dragged into the legal muck for unreasonable claims and the
other side of steering away from effectively robbing smaller plaintiffs of their
artistic rights in their own work. While Brownmark’s legal action was
unreasonable, the Court fears that imposing financial ruination on a small
company, like Brownmark, for an attempt to protect its rights might result
in similarly-situated plaintiffs with stronger claims refraining from
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Despite that potential, though, the Court finds that an award of
attorneys’ fees in this case would deter future action that is similar to
Brownmark’s. As to the risk of keeping small plaintiffs out of court, the
Court notes two things: first, that as important as those plaintiffs’ artistic
rights may be, the freedom of speech is perhaps of greater concern; and,
second, that plaintiffs will not be subject to these fees if they engage in
meaningful settlement talks before bringing their suit, work to resolve the
case without court intervention, and reasonably consider the defendants’
Because the Court finds that all of the Supreme Court’s factors are
met, the defendants are entitled to attorneys’ fees and costs in this case. This
conclusion is strengthened by the Seventh Circuit’s presumption that
prevailing defendants are entitled to such fees and costs. Assessment Techs.,
361 F.3d at 436.
Reasonableness of Costs and Fees
In total, the defendants request $46,775.23 in attorneys’ fees. Of that
amount, approximately $3,500 was spent on initial discussions with the
defendant parties and drafting the defendants’ letter response to Brownmark
(Docket #34, Ex. I at 39–43 (Billing Periods for Sep. 30, 2008, and Oct. 31,
2008)); another $7,500 was billed for reviewing the law, Brownmark’s
complaint, and potential strategies prior to filing a motion to dismiss (Docket
#34, Ex. I at 43–51 (Billing Periods for Oct. 31, 2008, Feb. 28, 2009, and Dec. 31,
2010)); then $17,000 was billed for the preparation and filing of the
defendants’ motion to dismiss (Docket #34, Ex. I at 52–60 (Billing Periods for
Jan. 31, 2011, and Feb. 28, 2011)); and, finally, approximately $9,500 was spent
in preparation of the defendants’ reply brief and other administrative matters
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(Docket #34, Ex. I at 61–70 (Billing Periods for March 31, 2011, April 30, 2011,
May 30, 2011, and June 30, 2011)); additional related services, provided by
local counsel, also contributed approximately $10,000 to the final sum
requested by the defendants (Docket #34, Ex. J).
The total calculation provided by the defendants, or the lodestar
figure, is presumptively reasonable when the party seeking attorneys’ fees
has shown the rate and number of hours worked is reasonable. Blum v.
Stenson, 465 U.S. 886, 897 (1984).
Brownmark does not dispute the reasonableness of the rates charged
by the defendants’ attorneys, but takes issue with a good portion of the hours
worked by the defendants’ attorneys. The Court finds those objections
unpersuasive. Brownmark first argues that pre-suit costs cannot be awarded
under Section 505. But Brownmark cites only its own interpretation of the
language in that statute and a case that does not seem to support the
proposition. (Pl.’s Resp. Atty. Fee 18–19 (citing Lenz v. Universal Music Corp.,
2010 U.S. Dist. LEXIS 125874 (N.D. Cal. 2010))). The Court believes that the
defendants advocate a wiser course: allowing recovery of pre-suit fees.
(Def.’s Reply Atty. Fee 11–12). In contrast to Brownmark, the defendants
have cited ample case law that supports the imposition of pre-suit fees,
including in a case similar to this one. (Def.’s Reply Atty. Fees 11–12 (citing
Mattel, Inc. v. MGA Entm’t, Inc., 2011 U. S. Dist. LEXIS 85998 (C.D. Cal.
August 4, 2011) and other non-copyright cases)).
Next, Brownmark argues that any hours worked that were not
catalogued as specifically related to the defendants’ fair use argument should
be treated as inadequately documented and, therefore, not charged to
Brownmark. (Pl.’s Resp. Atty. Fees 19–20 (citing Ohio-Sealy Mattress Mfg. Co.
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v. Sealy, Inc., 776 F.2d 646, 651 (7th Cir. 1985), Buckhannon Board & Care Home,
Inc. v. West Virginia Dept. of Health and Human Resources, 532 U.S. 598, 604
(2001))). According to Brownmark, the defendants’ fees that are attributable
to the fair use argument amount to less than $10,000. (Pl.’s Resp. Atty Fees
20). Again, though, the defendants have the best of the argument: the
“central issue” of this entire litigation was the fair use issue. That issue
consumed much of the pre-lawsuit discussions and a large chunk of the
briefs filed on the motion to dismiss.
While the Court disagrees with Brownmark’s arguments for docking
the reasonable number of hours worked, the Court will, nonetheless, dock
that number of hours as unduly duplicative. After reviewing the initial letter
sent by the defendants to Brownmark, the defendants’ brief in support of
their motion to dismiss, and the defendants’ reply brief on that matter, the
Court determines that the defendants’ attorneys were able to reuse
significant portions of their research in preparing each item. As such, the
Court finds that the defendants billed an unreasonable number of hours in
the preparation of each of those items. Accordingly, the Court docks one-half
of the number of hours spent in preparation of the brief in support and the
reply brief, effectively reducing the total fee by approximately $12,750. The
Court also finds that approximately one-half of local counsel’s time was
spent in preparation of the same materials, and docks one-half of that
amount, or approximately $2,500. In sum, the Court docks approximately
$15,250 of the total $46,775.23 sought by the defendants, leaving $31,525.23.
However, the Court will also exercise its discretion and limit
Brownmark’s fee liability to a much smaller amount than even the reduced
$31,525.23 figure. Despite all that has come before in this case, the Court
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remains cognizant of the fact that Brownmark is a very small entity, without
extensive assets. The Court has discretion in determining an award of
attorneys’ fees under Section 505, and may exercise that discretion to reduce
a fee, taking into account the financial circumstances of a party. Sassower v.
Field, 973 F.2d 75, 81 (2d Cir. 1992), Lieb v. Topstone Indus., Inc., 788 F.2d 151,
156 (3d Cir. 1986), Quaglia v. Bravo Networks, 2006 U.S. Dist. LEXIS 67123, at
*5 (D. Mass. Sep. 19, 2006), Polsby v. St. Martin’s Press, Inc., 2000 U.S. Dist.
LEXIS 596, at *7 (S.D.N.Y. Jan. 18, 2000), Littel v. Twentieth-Century Fox Film
Corp., 1996 U.S. Dist. LEXIS 454, at *3 (S.D.N.Y. Jan. 17, 1996). “[T]he aims of
the Copyright Act are compensation and deterrence where appropriate, but
not ruination.” Lieb, 788 F.2d at 156.
Thus, the Court will impose a fee that is lower than the $31,525.23
reasonable amount; this final fee will be tied to Brownmark’s size and ability
to pay. However, as the plaintiff has not submitted any documentation of its
assets and ability to pay attorneys’ fees, the Court requests that Brownmark
submit such documentation under seal (including relevant information such
as account balances, value of the company, salaries of the proprietors, any
additional sources of income or substantial assets held by the proprietors,
and the debts of both Brownmark and the individual proprietors).
Accompanying that submission, Brownmark shall include a short statement
and calculation regarding the fees it believes it is able to pay without causing
bankruptcy. Cognizant of the already-substantial amount of submissions in
this case—particularly as relates to the issue of attorneys’ fees—the Court
will allow, but not require, the defendants to respond to that submission with
a similarly brief statement, also to be filed under seal, addressing the
plaintiff’s calculated amount.
Page 18 of 19
For the foregoing reasons—fully considering all of the appropriate
evidence, the arguments of the parties, the purposes of this country’s
copyright laws, Brownmark’s financial situation, and the Court’s own
discretion under the law—the Court will grant an award of attorneys’ fees
and costs to the defendants, but will dock that award by an amount to be
determined following further submission by the parties.
IT IS ORDERED that the defendants’ motion for attorneys’ fees and
costs (Docket #34) be and the same is hereby GRANTED;
IT IS FURTHER ORDERED that the plaintiff shall submit an affidavit
detailing its financial status and an accompanying brief, which shall not
exceed three (3) pages, by December 20, 2011; and
IT IS FURTHER ORDERED that the defendants may submit a
responsive brief, which shall not exceed three (3) pages, by December 30,
2011; if the defendants do not wish to file a responsive brief, they shall
submit documentation to the Court notifying it of such decision.
Dated at Milwaukee, Wisconsin, this 30th day of November, 2011.
BY THE COURT:
U.S. District Judge
Page 19 of 19
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