Counsel Concerns

Ninth Circuit Upholds Sanctions Against Copyright Lawyer

By Stan Soocher

The U.S. Court of Appeals for the Ninth Circuit upheld sanctions against veteran copyright litigator Anthony Kornarens under 28 U.S.C. '1927 for “his five-year bad faith pursuit of a frivolous copyright infringement claim.” Lahiri v. Universal Music & Video Distribution Corp., 09-55111.

In the underlying case, Kornarens had handled sampling infringement litigation for Indian composer Bappi Lahiri over the composition “Thoda” that Lahiri had written for the Indian movie Jyoti. Lahiri's suit in the U.S. District Court for the Central District of California was consolidated with a similar one filed by Saregama India Ltd., which had acquired rights in the song from the film's production company. (Under India law, the copyright in music composed for a movie is automatically owned by the film producer as a work for hire.) According to the Ninth Circuit, Kornarens then “mischaracterized” an agreement between Lahiri and Saregama as resolving disputed copyright co-ownership between them. The appeals court noted: “Relying on the purported co-ownership settlement agreement, the district court erroneously concluded Lahiri was the co-owner of the Thoda copyright. [The agreement instead specified how Lahiri and Saregama would share any recovery in the infringement suit.] This error resulted in the denial of [the Universal Music] defendants' summary judgment motion against Lahiri predicated on the meritorious contention Lahiri lacked a copyright interest in Thoda. ' Contentious litigation ensued for three more years, resulting in an additional 233 docket entries and three rounds of trial preparation.”

The district court later granted summary judgment for the Universal Music defendants. The appeals court affirmed the lower court's sanctions against Kornarens of $258,206.04 in attorney fees and costs for the defendants' expenses caused by Kornarens sanctioned behavior. The appeals court concluded: “Had Kornarens, a self-described experienced copyright lawyer, made even a cursory investigation into the circumstances of Lahiri's 21-year old composition of Thoda, he would have known Lahiri had no copyright interest in music he composed for hire.”

”'

Attorney Fees Awarded To Prevailing
Defendants in Memorabilia Case

The U.S. District Court for the Eastern District of California awarded attorney fees to prevailing defendants in a right-of-publicity and Lanham Act suit filed by legendary pilot Chuck Yeager. Yeager v. Bowlin, 2:08-102. In January 2010, U.S. District Judge William B. Shubb had granted summary judgment for the memorabilia defendants, after rejecting, under the sham-affidavit rule, an updated but contradictory declaration Yeager filed. The defendants then submitted a block billing statement and asked for $296,673.50 in attorney fees; Judge Shubb ordered the defendants to submit an amended motion with more specifics. He accepted the amended billing statements by noting they “list the amount of time expended on each identified task instead of block billing for all time for a given day, [and] are sufficiently reliable. ' The declarations submitted by defendants' counsel indicate that the amended billing statements were created with reference to defendants' litigation file, the previous bills, and with information within counsel's personal knowledge.”

The Yeager plaintiffs then challenged the reasonableness of the hourly rates submitted which included $400 per hour for lead counsel Todd M. Noonan, a partner in Sacramento-based Stevens, O'Connell & Jacobs LLP. But Judge Shubb noted that “the cases cited by plaintiffs for the proposition that $250 per hour is a reasonable rate for Noonan's work in this action are inapposite. Unlike those cases, which involved relatively simple civil rights or Americans with Disabilities Act claims, litigation of this action required specialized knowledge of the complexities of intellectual property law in a suit involving a high profile plaintiff.”

Judge Shubb further found that “in a case such as this the hourly rate billed by the attorney is a rate which the client has agreed to pay, and would in fact pay if it did not prevail. It is also a rate that the attorney regularly bills and collects from his other clients for similar work. In cases like this the attorney's representation of the going rate for his services is entitled to greater credibility.”

The district judge awarded the defendants $275,596.58 in part because some of the requested attorney fees applied to case work that could have been accomplished by paralegals, such as preparing a discovery timetable and scheduling depositions.

”'

Manatt Petitions CA Supreme Court over Ruling Against Firm

By Brian Baxter

In a 41-page cert petition filed with the Supreme Court of California in mid-June, Manatt, Phelps & Phillips ' and a team of outside lawyers led by Quinn Emanuel Urquhart & Sullivan's national appellate practice chair Kathleen Sullivan ' argued that the legal issues surrounding the malicious prosecution case Manatt faces from The Franklin Mint were muddled enough to require clarification by the state's highest court.

In early May, California's Second District Court of Appeal issued a 3-2 ruling reinstating The Franklin Mint's case against Manatt and IP partner Mark Lee. Franklin Mint Co. v. Manatt, Phelps & Phillips LLP, 184 Cal.App.4th 313. The litigation stemmed from a suit Manatt brought against The Franklin Mint, a popular Exton, PA-based coin and collectible maker, on behalf of the estate of Princess Diana of Wales and a memorial fund set up in her memory.

Manatt sued the Mint in 1998 for trademark dilution and false advertising over the company's sales of plates and other collectible items bearing Diana's likeness. The firm was unsuccessful in its suit ' a former federal judge called its claims “groundless” and “unreasonable” ' and the Mint turned around and sued Manatt and Lee for malicious prosecution, claiming the litigation was merely an attempt to hurt sales of Diana memorabilia. (The Mint was particularly rankled by a passage in Manatt's complaint that accused it of being “vultures feeding on the dead,” which it claimed damaged its reputation.)

Diana's estate and her memorial fund settled with the Mint, but Manatt and Lee went to trial over a year ago. After a 17-day jury trial, a Los Angeles Municipal Court judge ruled that probable cause existed and granted nonsuit, ending the case in Manatt's favor.

But the Mint appealed on the issue of probable cause, and in May the California appellate court in a 50-page opinion reinstated the malicious prosecution claim against the firm and Lee. (A dissenting judge found that there was an adequate legal basis for Manatt to have brought the case against the Mint in 1998, objecting to the firm being targeted for damages because it was on the losing side of a case for its client. That argument is one that lawyers for Manatt and Lee refer to repeatedly in their cert petition.)

Lawyers from six firms are working on the case. Loeb & Loeb partner Andrew Clare represented The Franklin Mint at the trial level, before Akin Gump Strauss Hauer & Feld partners L. Rachel Helyar and Rex Heinke and senior counsel William Norris and Michael Small took over on appeal. The plaintiffs had 20 days to file their response to Manatt's cert petition.

Munger, Tolles & Olson partners Brad Brian and Michael Doyen represented Manatt at trial; name partner Ronald Olson is also listed on court filings. Partners David Axelrad, John Taylor, Jr., Frederic Cohen and Curt Cutting of Los Angeles appellate litigation boutique Horvitz & Levy took up the matter for Manatt on appeal, while Quinn Emanuel's Sullivan took the lead working on the California Supreme Court's petition for review. (Lee has turned to partners Kevin Brogan, Neil Martin and Dean Dennis from Los Angeles's Hill, Farrer & Burrill.)

The California Supreme Court had 60 days to decide whether to grant review. That deadline could be extended by 30 days.

Ninth Circuit Upholds Sanctions Against Copyright Lawyer

By Stan Soocher

The U.S. Court of Appeals for the Ninth Circuit upheld sanctions against veteran copyright litigator Anthony Kornarens under 28 U.S.C. '1927 for “his five-year bad faith pursuit of a frivolous copyright infringement claim.” Lahiri v. Universal Music & Video Distribution Corp., 09-55111.

In the underlying case, Kornarens had handled sampling infringement litigation for Indian composer Bappi Lahiri over the composition “Thoda” that Lahiri had written for the Indian movie Jyoti. Lahiri's suit in the U.S. District Court for the Central District of California was consolidated with a similar one filed by Saregama India Ltd., which had acquired rights in the song from the film's production company. (Under India law, the copyright in music composed for a movie is automatically owned by the film producer as a work for hire.) According to the Ninth Circuit, Kornarens then “mischaracterized” an agreement between Lahiri and Saregama as resolving disputed copyright co-ownership between them. The appeals court noted: “Relying on the purported co-ownership settlement agreement, the district court erroneously concluded Lahiri was the co-owner of the Thoda copyright. [The agreement instead specified how Lahiri and Saregama would share any recovery in the infringement suit.] This error resulted in the denial of [the Universal Music] defendants' summary judgment motion against Lahiri predicated on the meritorious contention Lahiri lacked a copyright interest in Thoda. ' Contentious litigation ensued for three more years, resulting in an additional 233 docket entries and three rounds of trial preparation.”

The district court later granted summary judgment for the Universal Music defendants. The appeals court affirmed the lower court's sanctions against Kornarens of $258,206.04 in attorney fees and costs for the defendants' expenses caused by Kornarens sanctioned behavior. The appeals court concluded: “Had Kornarens, a self-described experienced copyright lawyer, made even a cursory investigation into the circumstances of Lahiri's 21-year old composition of Thoda, he would have known Lahiri had no copyright interest in music he composed for hire.”

”'

Attorney Fees Awarded To Prevailing
Defendants in Memorabilia Case

The U.S. District Court for the Eastern District of California awarded attorney fees to prevailing defendants in a right-of-publicity and Lanham Act suit filed by legendary pilot Chuck Yeager. Yeager v. Bowlin, 2:08-102. In January 2010, U.S. District Judge William B. Shubb had granted summary judgment for the memorabilia defendants, after rejecting, under the sham-affidavit rule, an updated but contradictory declaration Yeager filed. The defendants then submitted a block billing statement and asked for $296,673.50 in attorney fees; Judge Shubb ordered the defendants to submit an amended motion with more specifics. He accepted the amended billing statements by noting they “list the amount of time expended on each identified task instead of block billing for all time for a given day, [and] are sufficiently reliable. ' The declarations submitted by defendants' counsel indicate that the amended billing statements were created with reference to defendants' litigation file, the previous bills, and with information within counsel's personal knowledge.”

The Yeager plaintiffs then challenged the reasonableness of the hourly rates submitted which included $400 per hour for lead counsel Todd M. Noonan, a partner in Sacramento-based Stevens, O'Connell & Jacobs LLP. But Judge Shubb noted that “the cases cited by plaintiffs for the proposition that $250 per hour is a reasonable rate for Noonan's work in this action are inapposite. Unlike those cases, which involved relatively simple civil rights or Americans with Disabilities Act claims, litigation of this action required specialized knowledge of the complexities of intellectual property law in a suit involving a high profile plaintiff.”

Judge Shubb further found that “in a case such as this the hourly rate billed by the attorney is a rate which the client has agreed to pay, and would in fact pay if it did not prevail. It is also a rate that the attorney regularly bills and collects from his other clients for similar work. In cases like this the attorney's representation of the going rate for his services is entitled to greater credibility.”

The district judge awarded the defendants $275,596.58 in part because some of the requested attorney fees applied to case work that could have been accomplished by paralegals, such as preparing a discovery timetable and scheduling depositions.

”'

Manatt Petitions CA Supreme Court over Ruling Against Firm

By Brian Baxter

In a 41-page cert petition filed with the Supreme Court of California in mid-June, Manatt, Phelps & Phillips ' and a team of outside lawyers led by Quinn Emanuel Urquhart & Sullivan's national appellate practice chair Kathleen Sullivan ' argued that the legal issues surrounding the malicious prosecution case Manatt faces from The Franklin Mint were muddled enough to require clarification by the state's highest court.

In early May, California's Second District Court of Appeal issued a 3-2 ruling reinstating The Franklin Mint's case against Manatt and IP partner Mark Lee. Franklin Mint Co. v. Manatt, Phelps & Phillips LLP , 184 Cal.App.4th 313. The litigation stemmed from a suit Manatt brought against The Franklin Mint, a popular Exton, PA-based coin and collectible maker, on behalf of the estate of Princess Diana of Wales and a memorial fund set up in her memory.

Manatt sued the Mint in 1998 for trademark dilution and false advertising over the company's sales of plates and other collectible items bearing Diana's likeness. The firm was unsuccessful in its suit ' a former federal judge called its claims “groundless” and “unreasonable” ' and the Mint turned around and sued Manatt and Lee for malicious prosecution, claiming the litigation was merely an attempt to hurt sales of Diana memorabilia. (The Mint was particularly rankled by a passage in Manatt's complaint that accused it of being “vultures feeding on the dead,” which it claimed damaged its reputation.)

Diana's estate and her memorial fund settled with the Mint, but Manatt and Lee went to trial over a year ago. After a 17-day jury trial, a Los Angeles Municipal Court judge ruled that probable cause existed and granted nonsuit, ending the case in Manatt's favor.

But the Mint appealed on the issue of probable cause, and in May the California appellate court in a 50-page opinion reinstated the malicious prosecution claim against the firm and Lee. (A dissenting judge found that there was an adequate legal basis for Manatt to have brought the case against the Mint in 1998, objecting to the firm being targeted for damages because it was on the losing side of a case for its client. That argument is one that lawyers for Manatt and Lee refer to repeatedly in their cert petition.)

Lawyers from six firms are working on the case. Loeb & Loeb partner Andrew Clare represented The Franklin Mint at the trial level, before Akin Gump Strauss Hauer & Feld partners L. Rachel Helyar and Rex Heinke and senior counsel William Norris and Michael Small took over on appeal. The plaintiffs had 20 days to file their response to Manatt's cert petition.

Munger, Tolles & Olson partners Brad Brian and Michael Doyen represented Manatt at trial; name partner Ronald Olson is also listed on court filings. Partners David Axelrad, John Taylor, Jr., Frederic Cohen and Curt Cutting of Los Angeles appellate litigation boutique Horvitz & Levy took up the matter for Manatt on appeal, while Quinn Emanuel's Sullivan took the lead working on the California Supreme Court's petition for review. (Lee has turned to partners Kevin Brogan, Neil Martin and Dean Dennis from Los Angeles's Hill, Farrer & Burrill.)

The California Supreme Court had 60 days to decide whether to grant review. That deadline could be extended by 30 days.