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The McGraw-Hill Companies Inc. v. Jones

United States District Court, W.D. Kentucky, Paducah

February 16, 2018

THE MCGRAW-HILL COMPANIES, INC., et al., PLAINTIFFS
v.
CHARLES A. JONES, et al., DEFENDANTS

          MEMORANDUM OPINION AND ORDER

          Thomas B. Russell, Senior Judge.

         This matter comes before the Court upon Motion by Defendant David Griffin (“Griffin”) seeking an order from this Court directing Plaintiffs to disclose the actual amount which has been paid to counsel in this matter. [DN 311.] Plaintiffs have responded, [DN 314], and Griffin has replied. [DN 315.] This matter is ripe for adjudication and, for the following reasons, IT IS HEREBY ORDERED that Griffin's Motion [DN 311] is DENIED.

         I. Background

         McGraw-Hill Global Education Holdings, LLC, along with several related entities, (collectively, “Plaintiffs”) filed suit against Griffin in 2012, bringing claims for copyright infringement, falsification of copyright management information, and trademark counterfeiting. Essentially, it was alleged by Plaintiffs that Griffin and co-defendant Charles Jones (“Jones”) were acquiring foreign-edition textbooks at a much lower cost than that of their domestic counterparts. After the acquisition of these textbooks, alterations were made to give them the appearance of domestic editions, and they were then sold at a considerable profit. In June 2016, an offer of judgment was presented by Griffin, pursuant to Federal Rule of Civil Procedure 68, which was accepted by Plaintiffs.[1]

         Since then, there has been considerable debate concerning whether the offer of judgment precluded an award of attorney fees to Plaintiffs. In the end, the Sixth Circuit, on appeal from Plaintiffs, determined that attorney fees could be included in counsel's costs. [See DN 300.] The present Motion filed by Griffin argues that he is entitled to present to the Court the amount of money actually paid by Plaintiffs to their counsel in litigating this matter, as opposed to the detailed billing statement already proffered by Plaintiffs. [See DN 292-11.] The merits of the Motion are discussed below.

         II. Discussion

         A.

         “A district court's award or denial of attorney's fees is reviewed for abuse of discretion.” Adcock-Ladd v. Sec'y of Treasury, 227 F.3d 343, 348-49 (6th Cir. 2000) (internal citations omitted). The lodestar method of fee calculation is the correct manner by which this Court determines attorney fees in cases such as the one currently before the Court. This calculation is accomplished “by multiplying the proven No. of hours worked by a court-ascertained reasonable hourly rate.” Ellison v. Balinski, 625 F.3d 953, 960 (6th Cir. 2010) (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). Crucially, “‘[t]he primary concern in an attorney fee case is that the fee awarded be reasonable, ' that is, one that is adequately compensatory to attract competent counsel yet which avoids producing a windfall for lawyers.” Adcock-Ladd, 227 F.3d at 349 (quoting Reed v. Rhodes, 179 F.3d 453, 471 (6th Cir. 1999)).

         To that end, the lodestar is the initial figure to which the Court looks in beginning its assessment of the “reasonableness” of the fee. See Id. Once that calculation is completed, “[t]he trial judge may then, within limits, adjust the ‘lodestar' to reflect relevant considerations peculiar to the subject litigation.” Id. (citing Reed, 179 F.3d at 471-72). There is “a ‘strong presumption' favor[ing] the prevailing lawyer's entitlement to his lodestar fee.” Id. at 350 (quoting City of Burlington v. Dague, 505 U.S. 557, 562 (1992), among other cases). This means that “modifications to the lodestar are proper only in certain rare and exceptional cases, supported by both specific evidence on the record and detailed findings by the lower courts.” Id. (internal citations omitted). In assessing the reasonableness of the hourly fee, the Court “should initially assess the ‘prevailing market rate in the relevant community, ” that is, “that rate which lawyers of comparable skill and experience can reasonably expect to command within the venue of the court of record…at least where the lawyer's reasonable home rate exceeds the reasonable local charge.” Id. (internal citations omitted).

         As Griffin points out in his instant Motion, in assessing the amount which is to be paid to the prevailing party, the Court “may consider, either in determining the basic lodestar fee and/or adjustments thereto, …the twelve [factors] listed in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir. 1974).” Id. Those twelve factors which the Court may consider are as follows:

(1) The time and labor required by a given case; (2) the novelty and difficulty of the questions presented; (3) the skill needed to perform the legal service properly; (4) the preclusion of employment by the attorney due to acceptance of the case; (5) the customary fee; (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.

Reed, 179 F.3d at 471-72 n.3; see also Adcock-Ladd, 227 F.3d at 349 n.8. In the Sixth Circuit, noticeably absent from the lodestar calculation or the twelve permissible Johnson factors, is the demand that the prevailing party disclose the amount paid to date in pursuit of the matter; that is, the amount of money actually doled out from litigant to counsel throughout the life of the case.

         B.

         In Griffin's Motion, he argues that when the Court undertakes to determine the amount of fees to be paid to Plaintiffs in this case, one factor the Court should take into consideration is the amount of money actually paid by Plaintiffs to their counsel throughout the course of this litigation, rather than the totals already provided. In support of this argument, Griffin cites to a No. of cases, one of which is the Second Circuit Court of Appeals' decision in Crescent Publ'g Grp., Inc. v. Playboy Enters., Inc.,246 F.3d 142 (2d Cir. 2001). There, the Second Circuit noted that “[t]he actual billing arrangement certainly provides a strong indication of what private parties believe is the ‘reasonable' fee to be awarded.” Id. at 151. More ...


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