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VIDEO-CINEMA FILMS, INC. v. CABLE NEWS NETWORK

February 3, 2004.

VIDEO-CINEMA FILMS, INC., Plaintiff,
v.
CABLE NEWS NETWORK, INC. d/b/a CNN, Defendant. VIDEO-CINEMA FILMS, INC., Plaintiff, v. AMERICAN BROADCASTING COMPANIES, INC., Defendant. VIDEO-CINEMA FILMS, INC., Plaintiff, v. CBS CORPORATION, OPINION and ORDER Defendant



The opinion of the court was delivered by: BARBARA JONES, District Judge

OPINION and ORDER

Plaintiff Video-Cinema Films, Inc. ("Video-Cinema") sued Defendants Cable News Network, Inc. LLP, LLLP, d/b/a CNN ("CNN"), American Broadcast Network ("ABC") and CBS Broadcasting Inc. ("CBS"), claiming that the Defendants Page 2 infringed Plaintiff's copyright, pursuant to 17 U.S.C. § 101, and unfairly competed with Plaintiff when they broadcasted nationally excerpted footage from the motion picture "The Story of G.I. Joe" after the death of actor Robert Mitchum, who had appeared in that film. The Court granted summary judgment to the Defendants on September 18, 2001. Video-Cinema Films, Inc. v. Cable News Network, Inc., 2001 WL 1154625 (S.D.N.Y. Sept. 18, 2003), as amended, 2001 WL 1518264 (S.D.N.Y. Nov 28, 2001).

Following this decision, Defendants submitted an application for legal fees jointly "to conserve judicial resources," and to avoid unnecessary and duplicative work and costs. Video-Cinema Films, Inc. v. Cable News Network, Inc., 2003 WL 1701904, *1 (S.D.N.Y. Mar. 31, 2003). The Court ruled in favor of the Defendants on March 31, 2003 ("Fee Decision"). Id. In reaching its decision to award fees and costs to Defendants, this Court noted that " [t]hroughout the underlying litigation, Plaintiff made objectively unreasonable factual and legal arguments." Id. at *2 (citing several arguments that the Court found to be without merit).

  Presently before the Court are the motions to determine the exact amount of attorneys' fees and costs Page 3

  Plaintiff will pay to Defendants pursuant to the Fee Decision. See id.

  DISCUSSION

  Section 505 of the Copyright Act provides that:
[i]n any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney's fee to the prevailing party as part of the costs.
17 U.S.C. § 505.

  In determining what constitutes a reasonable fee award under Section 505, courts in this circuit frequently apply the "lodestar" method. See Crescent Pub'g Group, Inc. v. Playboy Enters., Inc., 246 F.3d 142, 146, 150 (2d Cir. 2001); see generally Yurman Designs, Inc. v. PAJ, Inc., 125 F. Supp.2d 54 (S.D.N.Y. 2000). Under this method, "fees are determined by multiplying the number of hours reasonably expended on the litigation by a reasonable hourly rate." Earth Flag Ltd, v. Alamo Flag Co., 154 F. Supp.2d 663, 668-69 (S.D.N.Y. 2001) (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)); see also Savoie v. Merchants Bank, 166 F.3d 456, 460 (2d Cir. 1999).

  Rates are deemed reasonable when they are "commensurate with the rates prevailing in the community for similar services by lawyers of reasonably comparable Page 4 skill, experience and reputation." Yurman Designs, 125 F. Supp.2d at 58; see also Crescent Publ'g Group, 246 F.3d at 150-51. Some courts have considered various publication surveys of billing rates, such as the National Law Journal's annual survey of rates charged by the nation's 250 largest law firms and the billing rate surveys conducted by the American Intellectual Property Law Association ("AIPLA"). See, e.g., Yurman Designs, 125 F. Supp.2d at 55-58; Celebrity Serv. Int'l, Inc. v. Celebrity World, Inc., 9 U.S.P.Q.2d 1673, 1687 (S.D.N.Y. 1988). Courts also may consider the billing rates approved in comparable cases, see, e.g., Luciano v. Olsten Corp., 109 F.3d 111, 115-16 (2d Cir. 1997); New York State Nat'l Org. for Women v. Pataki, 2003 WL 2006608, *2 (S.D.N.Y. Apr. 30, 2003), and may also rely on their own knowledge of current market rates for attorneys of similar skill and experience. See Screenlife Establishment v. Tower Video, Inc., 868 F. Supp. 47, 53 (S.D.N.Y. 1994).

  Fee awards should also reflect the skill of the attorneys and the results achieved. Earth Flag Ltd., 154 F. Supp.2d at 669. With respect to the "results achieved" aspect, courts have repeatedly stressed that success is to be measured by whether important copyright policies, such as the fair use doctrine, have been advanced by the party's Page 5 actions, not by mere financial gain or by the amount at issue. See Crescent Publ'g Group, 246 F.3d at 150 ("Because copyright actions may not always result in high damage awards, for instance if the commercial value of the work is minimal . . . an objective measure such as the lodestar seems the most effective method in enabling parties to retain competent counsel.").

  The Court finds that the hours claimed by all the Defendants are reasonable, especially in light of the protracted nature of the litigation and the objectively unreasonable arguments made by the Plaintiff, but modifies each Defendant's requested reward, as explained more fully herein.*fn1 Cf. id., 246 F.3d at 147, 150.

 1. CNN

  CNN, through its counsel Davis Wright Tremaine LLP ("DWT"), seeks the award of attorney's fees and costs in the amount of $282,855 ($236,439 in fees and $21,045 in costs for all legal work performed in the underlying action, and $24,567 in fees and $804 in costs for all legal work performed in the fee proceedings). Page 6

  a. DWT's Billing Rates

  One partner, two associates, and several paralegals at DTW, a national law firm of more than 300 attorneys, worked on this litigation out of DWT's New York office since the case's inception in October 1998 through the summary judgment decision in October 2001. (Balin Decl. at 10-11). DWT has a sizable media law and intellectual property department and represents numerous high-profile clients in copyright, amongst other types, of litigations. (Id. at 11, Ex. 11). The specific attorneys who worked on this matter are very well-educated, well-credentialed and experienced in IP litigation. (Id. at 11-14; Exs. 12-14).

  From October 1998 until June 1999, DWT charged CNN on all the matters it handled for CNN*fn2 the standard billing rates of the partners, associates and paralegals working at the firm. (Id. at 14) From June 1999 through December 1999, under a "sliding scale volume" arrangement, the rates billed were discounted by 5%, then 8%, then up to 10% from the standard rates. (Id.). Thereafter, a new arrangement took affect, whereby DWT's standard fees were flatly discounted by 10%, from January 2000 through mid-2001, and Page 7 then modified only for partner's billing to a 13% discount through December 2002. (Id. 14-15).

  For instance,*fn3 in 2000, the per hour rates were as follows: the partner's standard rate was $295 and billed rate to CNN was $265; the two associates' standard rates were $240 and $200, and billed rate to CNN was $216 and $180 respectively, the paralegals' standard billing rate was $120 and billed rate to CNN was $108. (Id. at 15; Ex. 6).

  The Court finds that DWT's billing rates are reasonable for several reasons. First, these rates are commensurate with the rates prevailing in the community for similar services by lawyers of reasonably comparable skill, experience and reputation. Cf. Yurman Designs, 125 F. Supp.2d at 58. Accordingly to the AIPLA surveys, DWT's billing rates are below the median rates charged by other New York law firms of similar size and copyright litigation experience. (See Balin Decl. Exs. 15-17). For example, in 2000, the median billing for New York City intellectual property law firms were $370 per hour for partners and $250 per hour for associates, which is at or above DWT attorneys' rates. (See id. Ex. 16; see also Ex. 18 (showing Page 8 that 80% of New York law firms paralegals rates ranged from $105 to $150)).

  Second, DWT's billing rates are also below the rates awarded New York counsel in similar intellectual property litigations. Cf. Yurman Designs, 125 F. Supp.2d at 55-58 (approving and awarding average billing rates of $520 for partners, $278 for associates, and $162 for paralegals for the year 1999); Yamanouchi Pharmaceutical Co. v. Danbury Pharmacal, Inc., 51 F. Supp.2d 302, 305 (S.D.N.Y. 1999)(finding 1998 partner billing rates of $350 and $390 "ball-park reasonable"). Third, the Court, from its own knowledge of prevailing billing rates, finds DWT's rates to be reasonable.*fn4

  Therefore, the Court finds that the rates billed by DWT's attorneys and paralegals are reasonable.

  b. Time Spent by DWT

  DWT invoiced 1,057 hours of work for all of its employees involved in this litigation. The Court finds this amount of time is reasonable for this protracted litigation that spanned three years and included motions, depositions, Page 9 and discovery requests and disputes. See Ballin Dec. at 25-40. DWT's time was also undoubtedly multiplied by Plaintiff's numerous unreasonable claims and arguments. See Video-Cinema Films, 2003 WL 1701904, at *2-5. Moreover, it is clear from the records supplied by DWT that, in addition to its discounted rates, it also ...


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