United States District Court, W.D. Pennsylvania
Barry Fischer United States District Judge
before the Court is Defendant Eddy Homes, Inc.'s Motion
for Attorneys' Fees and Costs, (Docket No. ),
Plaintiff's response in opposition, (Docket No. ),
and Defendant's reply, (Docket No. ). After careful
consideration of the parties' submissions; the standard
governing motions for attorneys' fees, 17 U.S.C. §
505; and for the following reasons, Defendant's Motion
for Attorneys' Fees and Costs, (Docket No. ), is
holding, the Court notes that the facts of this case are
detailed in its December 22, 2016 Memorandum Opinion, wherein
the Court granted Defendant's Motion to Dismiss
Plaintiff's First Amended Complaint. (Docket No. 30). In
pertinent part, Plaintiff is the owner of the copyright in
the design of the interior of a home constructed by Defendant
for Mr. and Mrs. Thomas Sterling (“the
Sterlings”). (Id. at 2). In October 2015,
photographs of the interior of the Sterlings' home were
published in periodicals and magazines and on Defendant's
website and several social media websites without crediting
Plaintiff. (Id.). Plaintiff filed this action and
asserted claims against Defendant for copyright infringement
and for unfair competition. (Id. at 3). As noted,
the Court granted Defendant's motion to dismiss
Plaintiff's claim for copyright infringement,
(id. at 5-10), and declined to exercise supplemental
jurisdiction over Plaintiff's state law claim for unfair
competition, (id. at 10-16).
Defendant filed the instant motion, asserting that it is
entitled to attorneys' fees and costs because
Plaintiff's position was objectively unreasonable.
(Docket No. 35 at 2-3). Plaintiff counters that it attempted
to resolve this matter prior to filing this action and that
its motive in filing suit was to protect its intellectual
property. (Docket No. 37 at 3-4). In reply, Defendant
maintains that the lawsuit was frivolous and that
Plaintiff's motive in filing the action was to obtain a
financial windfall. (Docket No. 39 at 3-5). Plaintiff has not
appealed this Court's December 22, 2016 Memorandum
Opinion dismissing its First Amended Complaint. Hence, this
matter is ripe for disposition.
505 of the Copyright Act provides:
In 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. Thus, the Copyright Act permits a
discretionary award of attorneys' fees to the prevailing
party in a copyright lawsuit. Id.; Fogerty v.
Fantasy, Inc., 510 U.S. 517, 533 (1994) (noting that
§ 505 “clearly connotes discretion” and
explaining that a district court may not “award
attorney's fees as a matter of course”). Several
factors guide the exercise of a court's discretion in
this context, including “‘frivolousness,
motivation, objective unreasonableness (both in the factual
and legal components of the case) and the need in particular
circumstances to advance considerations of compensation and
deterrence.'” Fogerty, 510 U.S. at 534
n.19 (quoting Lieb. v. Topstone Indus., Inc., 788
F.2d 151, 156 (3d Cir. 1986)). As the Third Circuit has
recently explained, the Supreme Court “reaffirmed that
§ 505 fee awards are discretionary and placed extra, but
not controlling, weight on the ‘objective
unreasonableness' factor, and reminded courts to consider
the totality of the circumstances and make a
‘particularized, case-by-case assessment.'”
Leonard v. Stemtech Int'l, Inc., 834 F.3d 376,
403 (3d Cir. 2016) (quoting Kirtsaeng v. John Wiley &
Sons, Inc., 136 S.Ct. 1979 (2016). “While there is
no requirement of bad faith in determining whether to award
attorneys' fees and costs, a court must be evenhanded in
exercising its discretion.” Lowe v. Loud
Records, 126 F. App'x 545, 547 (3d Cir. 2005).
reviewed the entire docket, including the parties'
current submissions and after carefully considering their
respective arguments, the Court in its discretion will
decline to award attorneys' fees. Relative to
Defendant's assertions that Plaintiff's lawsuit was
both frivolous and objectively unreasonable, (Docket Nos. 35
at 2-3; 39 at 3-5), the Court initially finds that Defendant
has waived the argument that Plaintiff's lawsuit was
frivolous, as Defendant did not raise same in its initial
brief. (See Docket Nos. 35; 39 at 3-5). It is well
settled that “legal arguments not raised and relief
that is not specifically sought in the initial motion are
generally deemed waived.” Vay v. Huston, No.
14-CV-769, 2016 U.S. Dist. LEXIS 48534, at *26 (W.D. Pa. Apr.
11, 2016); see also Anspach v. City of Phila., 503
F.3d 256, 258 n.1 (3d Cir. 2007) (“[F]ailure to raise
an argument in one's opening brief waives it.”);
Sproull v. Golden Gate Nat'l Senior Care, LLC,
No. 2:08-CV-1107, 2010 U.S. Dist. LEXIS 5088, at *8-9 (W.D.
Pa. Jan. 22, 2010) (“[T]he reply brief generally cannot
be used to expand the issues presented for adjudication
beyond those raised in the moving papers.”).
the Court finds that Plaintiff's lawsuit was neither
frivolous nor objectively unreasonable. See 4C, Inc. v.
Pouls, No. 11-CV-778, 2012 U.S. Dist. LEXIS 84607, at *7
(D. Del. June 19, 2012) (explaining that courts have analyzed
frivolousness and objective unreasonableness together).
“Frivolousness” is defined as “lacking any
plausible merit, ” Warren Publ'g Co. v.
Spurlock, No. 08-CV-3399, 2010 U.S. Dist. LEXIS 20584,
at *13 (E.D. Pa. Mar. 3, 2010) (internal quotations omitted),
while “objective unreasonableness encompasses both a
legal and a factual component, ” Pouls, 2012
U.S. Dist. LEXIS 84607, at *7 (internal quotations and
alterations omitted). The fact that a motion to dismiss was
granted against a plaintiff does not necessarily render the
plaintiff's claims unreasonable per se. See,
e.g., Gillan & Hartmann, Inc. v. Kimmel Bogrette
Architecture Site, Inc., No. 15-1035, 2015 U.S. Dist.
LEXIS 69959, at *13-21 (E.D. Pa. May 28, 2015) (granting
motion to dismiss and denying motion for attorneys' fees
because the lawsuit was not objectively unreasonable);
Visual Communs., Inc. v. Assurex Health, Inc., 2014
U.S. Dist. LEXIS 131495, at *10-28 (E.D. Pa. Sept. 18, 2014)
(same). See also Fogerty, 510 U.S. at 534-35
(discussing discretionary nature of determining an award of
attorneys' fees and rejecting automatic recovery by
prevailing party under 17 U.S.C. § 505); Cottrill v.
Spears, No. 02-CV-3646, 2003 U.S. Dist. LEXIS 11656, at
*6-7 (E.D. Pa. July 2, 2003) (“[H]indsight is not the
applicable standard in judging the reasonableness of
[Plaintiffs'] suit.”) (internal quotations
Plaintiff's theory of the case was well asserted and
argued. The Court's decision to grant Defendant's
motion to dismiss relied not on settled Third Circuit
precedent, but on thoughtful consideration of persuasive
authority. Indeed, after reviewing the parties' briefing,
the Court did not locate authority within this jurisdiction
regarding the applicability of 17 U.S.C. § 120 to
Plaintiff's claim for copyright infringement. The Court,
therefore, ordered supplemental briefing to address the
impact of Landrau v. Solis-Betancourt, 554 F.Supp.2d
102 (D.P.R. 2007), a case outside its jurisdiction. (Docket
No. 16). Upon review of the parties' supplemental
briefing, the Court ordered oral argument, at which time the
parties discussed the possibility of participating in a
settlement conference. (Docket Nos. 19, 20). The Court stayed
this matter pending the disposition of the settlement
conference before Magistrate Judge Lisa Pupo Lenihan. (Docket
Nos. 23, 24). The Court lifted the stay after the parties
were unable to resolve the case. (Docket Nos. 28, 29). Then,
the Court thoroughly analyzed the underlying facts, legal
issues, and what the Court deemed to be persuasive precedent.
(Docket No. 30 at 5-10). The Court's lengthy Memorandum
Opinion and Order granting Defendant's motion to dismiss
is evidence of the non-frivolous and objectively reasonable
nature of this action. (See id.). Further, the
Court's Order permitted the state claims to proceed, in
the event that Plaintiff sought that route. (Id. at
16). Therefore, the Court cannot conclude that Plaintiff set
forth frivolous or objectively unreasonable claims here.
Court also finds that Plaintiff's position was
reasonable. In support of its brief in opposition to
Defendant's motion, Plaintiff has attached a declaration
prepared by its president, Thomas D. Trzcinski. (Docket No.
37-1). In his declaration, Mr. Trzcinski states that he
telephoned Defendant's vice president, Matthew Moritz, to
request a correction or clarification for images that were
used by and were incorrectly attributed to Defendant.
(Id. at ¶ 5). Mr. Trzcinski affirms that he
also discussed the potential for joint marketing efforts and
alleges that Mr. Moritz was not receptive to his suggestions.
(Id.). Mr. Trzcinski then states that Plaintiff
initiated this action after “[his] personal efforts to
resolve this issue were met with continued use of photos
focused almost exclusively on [Plaintiff's] design
elements in [Defendant's] marketing campaigns.”
(Id. at ¶¶ 6-7). Defendant confirms that
the parties discussed jointly marketing the Sterlings'
home. (Docket No. 39 at 4).
the fact that settlement negotiations are confidential,
see 28 U.S.C. § 652; see also
Practices and Procedures of Judge Nora Barry Fischer §
III.A. (ii), Effective Mar. 23, 2010, available at
Defendant argues that Plaintiff was uncooperative at the
settlement conference and “insisted on an exorbitant
settlement payment, ” (Docket No. 39 at 5). Accepting
Defendant's statement, which the Court would generally be
loath to do because such negotiations must remain
confidential, it is not surprising to the Court that
Plaintiff and its counsel would seek a monetary award at the
settlement conference given the amount of time and associated
attorneys' fees and costs expended at that point in time.
Moreover, Defendant once again did not raise this argument in
its initial brief, (see Docket Nos. 35; 39 at 4-5),
and has waived same. See Vay, 2016 U.S. Dist. LEXIS
48534, at *26; see also Anspach, 503 F.3d at 258
n.1; Sproull, 2010 U.S. Dist. LEXIS 5088, at *8-9.
Therefore, despite Defendant's last argument, the Court
concludes that Plaintiff's action was neither legally nor
upon the foregoing, the Court in its discretion also finds
that an award of costs to Defendant is unwarranted. See,
e.g., Visual Communs., Inc., at *27 (denying
the defendant's motion for attorneys' fees and
costs); Spark Innovators Corp. v. Tele Marketers,
Inc., No. 14-CV-1771, 2014 U.S. Dist. LEXIS 83438, at
*23-24 n.6 (D.N.J. June 19, 2014) (same); Inst. for
Motivational Living, Inc. v. Sylvan Learning Ctr., Inc.,
No. 06-CV-828, 2008 U.S. Dist. LEXIS 80777, at *3-4 (W.D. Pa.
June 18, 2008) (same). Cf. Broad. Music, Inc. v. George
Moore Enters., 184 F.Supp.3d 166, 173-74 (W.D. Pa. 2016)
(awarding attorneys' fees and costs where the defendants
acted objectively unreasonable by failing to defend the
action); Broad. Music, Inc. v. Longhorn Corral,
Inc., No. 15-CV-950, 2016 U.S. Dist. LEXIS 4733, at
*11-13 (W.D. Pa. Jan. 14, 2016) (same).
these reasons, IT IS HEREBY ORDERED that Defendant Eddy
Homes, Inc.'s Motion for Attorneys' Fees and ...