Great American Duck Races Inc. v. Kangaroo Manufacturing Inc.

          ORDER

          Honorable Roslyn O. Silver Senior United States District Judge

         After prevailing at trial, Defendants Kangaroo Manufacturing, Inc., Yagoozon Inc., and Justin Ligeri (collectively, “Defendants”) seek an award of $249, 298.50 in attorneys' fees. Plaintiff Great American Duck Races Inc. (“GAME”) believes no award of fees is merited but, if an award is made, it should be substantially less than what Defendants seek. Based on the relevant factors, and especially the objectively reasonable nature of GAME's copyright claim, Defendants' motion will be denied.

         BACKGROUND

         Sometime in 2016, Defendants began selling a pool float in the shape of a duck wearing sunglasses. That float was similar to a copyrighted pool float manufactured by GAME. In January 2017, GAME filed the present suit against Defendants.^[1] The original complaint contained claims for copyright infringement, trademark infringement, federal unfair competition, and Arizona unfair competition. (Doc. 1). Defendants answered the complaint and asserted seven counterclaims. Three of the counterclaims sought declaratory judgment that there had been no copyright infringement, no trademark infringement, and no unfair competition under federal or Arizona law. In other words, those three counterclaims were mirror images of GAME's claims for relief. Defendants asserted additional counterclaims for declaratory judgment involving copyright invalidity and trademark invalidity as well as counterclaims seeking cancellation of certain trademarks and relief based on GAME making misrepresentations to a non-party seller. (Doc. 18). After a Scheduling Conference, the parties proceeded with discovery.

         At a post-discovery status conference Defendants agreed to dismiss four of their counterclaims. Dismissing those four counterclaims meant the pending claims and counterclaims were based on copyright infringement, trademark infringement, and unfair competition. After discussing the underlying facts with both sides, Defendants conceded a trial was necessary. Trial was set for October 2018.

         Shortly before trial, Yagoozon provided notice that it had filed for bankruptcy. (Doc. 120). The trial was continued to give the bankruptcy court time to rule on GAME's motion for relief from the automatic stay. Once the bankruptcy court granted that motion, the trial was reset for March 2019. (Doc. 145). On February 8, 2019, GAME requested the Court dismiss its demand for monetary relief and conduct a bench trial instead of a jury trial. (Doc. 147). Defendants did not object to either request. Thus, GAME's demand for monetary relief was dismissed and a bench trial was set. (Doc. 151). After a two-day bench trial, the Court entered judgment against GAME on all of its remaining claims. The Court also dismissed Defendants' remaining counterclaims because they were “mirror images of GAME'S affirmative claims for relief” and there was no need to enter declaratory judgment. (Doc. 198 at 19).

         Defendants now seek an award of attorneys' fees pursuant to the Copyright Act. According to Defendants, the relevant factors under the Copyright Act support such an award. Defendants argue they should be awarded all the fees they incurred in defending this suit because GAME's copyright, trademark, and unfair competition claims were “so intertwined” that it would be impossible to identify the time spent on individual claims. (Doc. 201 at 7). GAME responds that the factors under the Copyright Act do not support an award of fees, Defendants should have identified the time spent litigating each claim, and the total amount of fees requested is not reasonable.

         ANALYSIS

         If Defendants are not entitled to an award of fees under the Copyright Act, there is no need to address whether Defendants should have identified the time spent on litigating each claim nor is there any need to address the overall reasonableness of the amount requested. Thus, the analysis begins and ends with Defendants' entitlement to fees under the Copyright Act.

         The Copyright Act states a “court may . . . award a reasonable attorney's fee to the prevailing party.” 17 U.S.C. § 505. This language “grants courts wide latitude to award attorney's fees based on the totality of circumstances in a case.” Kirtsaeng v. John Wiley & Sons, Inc., 136 S.Ct. 1979, 1985 (2016). Courts have identified a long list of nonexclusive factors a court should use as “judicial guideposts” for deciding whether to award fees. Glacier Films (USA), Inc. v. Turchin, 896 F.3d 1033, 1037 (9th Cir. 2018).

         The factors include:

1. the losing party's “objective unreasonableness (both in the factual and in the legal components of the case)”;

2. whether the losing party's positions were ...