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MEDLINE INDUSTRIES, INC. v. MEDLINE PRODUCTS COMPANY

July 7, 2004.

MEDLINE INDUSTRIES, INC., an Illinois corporation, Plaintiff,
v.
MEDLINE PRODUCTS COMPANY a Thailand company, Defendant.



The opinion of the court was delivered by: GERALDINE SOAT BROWN, Magistrate Judge

REPORT AND RECOMMENDATION

Plaintiff Medline Industries, Inc. has requested an award of its attorneys' fees and costs. [Dkt 10, 19.] In a prior Order, the District Judge awarded Plaintiff its attorneys' fees and costs pursuant to 15 U.S.C. § 1117(a), and referred the determination of the amount of attorneys' fees and costs to this court for a report and recommendation. [Dkt 13, 14.] Defendant has not objected to the amount sought by Plaintiff. For the following reasons, this court respectfully recommends that Plaintiff's request for attorneys' fees and costs be granted in part and denied in part as discussed herein, and that Defendant be ordered to pay $35,510.26 in attorneys' fees and costs incurred by Plaintiff. Background

Plaintiff filed suit against Defendant, alleging claims of federal trademark infringement, cybersquatting, unfair competition, and dilution in violation of the Lanham Act, and claims under the Illinois Deceptive Trade Practices Act and Illinois Consumer Fraud and Deceptive Business Practices Act. [Dkt 1.] On December 18, 2003, the District Judge entered a default judgment against Defendant in favor of Plaintiff, and ordered Plaintiff to file prove-up documents to support its request for damages and lost profits. [Dkt 9.] On March 1, 2004, the District Judge approved Plaintiff's prove-up in part, awarding Plaintiff $100,000 in statutory damages but denying Plaintiff's request for more than $18,000,000 in profits, treble damages and prejudgment interest. [Dkt 14.] In addition, finding that Plaintiff's allegations (deemed true because of Defendant's default) established that the infringement was deliberate, the District Judge also awarded Plaintiff its reasonable attorneys' fees and costs pursuant to 15 U.S.C. § 1117(a), which provides that plaintiffs "shall be entitled . . . to recover . . . the costs of the action" and that prevailing parties may be awarded their reasonable attorneys' fees in "exceptional cases." (Order, March 1, 2004); 15 U.S.C. § 1117(a).

  Plaintiff requested attorneys' fees and costs in the total amount of $45,492.27 and submitted Materials In Support Of Attorneys' Fees and Costs. [Dkt 19.] The Materials included a declaration by the attorney primarily responsible for the litigation of the case, Janet Marvel, who attached a schedule setting forth the total charges for each attorney, paralegal, and other professional support staff who performed work on the case. (Pl.'s Materials Supp. Att'ys Fees and Costs, Ex. 1, Declaration of Janet Marvel; Ex. 1(A), Schedule.) All of the fees and costs were incurred between August 2003 and March 2004. (Id.) Those fees consisted of 17.3 hours of work by Ms. Marvel, a partner at the firm of Pattishall, McAuliffe, Newbury, Hilliard & Geraldson ("Pattishall, McAuliffe") at the rate of $380.00 per hour; 112.30 hours of work by Chad Doellinger, an associate at Pattishall, McAuliffe, at the rate of $180.00 per hour; 18.3 hours of work by Angela Steele, another associate at Pattishall, McAuliffe, at the rate of $170.00 per hour; 10.5 hours of work by two law clerks at Pattishall, McAuliffe (A. Iacullo and C. O'Brien), at the rate of $150.00 per hour; and 13.3 hours of work by three paralegals at Pattishall, McAuliffe (A. Al-Sakhria, C. Bulthuis, and E. Salvo), at the rate of $150.00 per hour. (Id., Exs. 1(B) & 1(E), Monthly Billing Records.)*fn1 Ms. Marvel avers that the hourly rates charged are reasonable and customary for attorneys in the Chicago area who provide legal services for intellectual property matters. (Marvel Decl. ¶ 4.)

  Also attached to Ms. Marvel's declaration is a listing of the expenditures (by type and billing month) incurred by Plaintiff in litigating this matter. (Id., Exs. C & D, Expenditures Listings.) The expenditures were incurred between billing months September 2003 and March 2004 and totaled $11,961.27.*fn2 (Id., Ex. D, Expenditures Listing.) The largest component of that total was computerized legal research expenses ($10,510.30). (Id., Ex. C, Expenditures Listing.) In addition, there were courier and delivery charges, filing fees, duplicating, telephone and facsimile costs, travel costs, postage, and service of the complaint. (Id.) In her declaration, Ms. Marvel stated her belief that those charges were reasonable and comparable to customary charges for like work. (Marvel Decl. ¶ 5.)

  The amount of costs and attorneys' fees to be awarded was referred to this court on March 2, 2004 for a report and recommendation. (Order, March 2, 2004.) On March 16, 2004, this court held a status hearing on Plaintiff's request for attorneys' fees and costs. (Order, March 16, 2004.) [Dkt 17.] No one appeared on behalf of Defendant. (Id.) At that status hearing, the court ordered that any response to Plaintiff's request for attorneys' fees and costs, or any objection to any amounts sought therein, must be filed by April 6, 2004. (Id.) This court further ordered that Plaintiff's counsel serve a copy of the court's order to Defendant by facsimile and by mail at Defendant's last known address, and file a certificate of service demonstrating compliance with that order. (Id.) Plaintiff filed a certificate of service indicating compliance with the court's order on March 18, 2004. [Dkt 18.] Defendant never filed any opposition to Plaintiff's request for attorneys' fees and costs.

  As further discussed below, Plaintiff's counsel was subsequently ordered to provide additional information regarding its request for $10,510.30 in computerized legal research expenditures. (Order, May 27, 2004.) [Dkt 20.] Plaintiff's counsel filed a supplemental submission on June 4, 2004. [Dkt 21.] Defendant did not file a response, although the court had provided it time to do so. (Order, May 27, 2004.)

  Discussion

  A. Attorneys' fees requested by Plaintiff

  The court has reviewed the materials filed by Plaintiff in support of its request for attorneys' fees. Based on the materials submitted along with the declaration of Ms. Marvel, as well as a review of the other pleadings and briefs that have been filed in this lawsuit, the court finds that the hourly rates charged and the hours expended are reasonable, with several exceptions that will be discussed further below.

  With respect to the hourly rates charged by the attorneys in this case, ranging from $170.00 to $380.00 per hour, the court finds those rates to be reasonable, as they do not appear to be in excess of the rates charged by other attorneys in the Chicago area performing work on intellectual property matters. See, e.g. Microsoft Corp. v. T & S Internatl. Corp., No. 03 C 4219, 2004 WL 407008 at *1 (N.D. Ill. Mar. 3, 2004) (Darrah, J.) (awarding attorneys' fees in Lanham Act case based on hourly rates of $265.00 to $450.00 per hour).

  However, the hourly rate of $150.00 charged by the paralegals and law clerks working on the case is excessive. Courts in this district have recently allowed hourly rates ranging from $50.00 to $126.00 for paralegal and law clerk work. See, e.g., In re Amister Copyright Litig., No. 01 C 8933, 2003 WL 2002764 at *6 (N.D. Ill. April 15, 2003) (Aspen, J.) (allowing hourly rate of $126.00 for paralegals); Holland v. Barnhart, No. 02 C 8398, 2004 WL 419871 at *2 (N.D. Ill. Feb. 3, 2004) (Aspen, J.) (reducing rate charged by paralegal to $50.00 per hour); Embry v. Barnhart, No. 02 C 3821, 2003 WL 22478769 at *3 (N.D. Ill. Oct. 31, 2003) (Brown, M.J.) (finding hourly rate of $95.00 appropriate for law clerk and paralegal). See also Jackson v. Sturkie, 255 F. Supp.2d 1096, 1106 (N.D. Cal. 2003) (stating that the $70.00 hourly rate requested for time spent by paralegal was reasonable).

  In this case, no information has been submitted regarding the education, training or experience of those paralegals and law clerks to justify a billing rate close to that of the associate attorneys. However, certain of the work done by paralegals and law clerks in this case was somewhat advanced, such as investigating how to achieve service of process on a defendant in Thailand Thus, a rate at the higher end of the scale is justified. Given that Defendant did not object to the $150.00 hourly rate charged by the paralegals and law clerks, the court will allow an hourly rate of $125.00, thereby reducing the rate charged by the paralegals and law clerks by $25.00 per hour. Because the paralegals and law clerks spent a total of 23.8 hours on this case (Marvel Decl., Ex. B, Billing Records), the total amount sought by Plaintiff should be reduced by $595.00 ($25.00 × 23.8 hours).

  In addition, some of the attorneys' time listed is excessive in light of the tasks performed. Specifically, the approximately five hours (amounting to approximately $958.00) spent by three attorneys to research and prepare filings relating to the District Court's voluntary Lanham Act mediation program is excessive. (Id., Ex. B, Billing Records, Invoices dated Dec. 17, 2003 and Jan. 31, 2004.) Plaintiff's attorneys could not have required significant research about the program, which has been in place in the Northern District of Illinois since 1996. Attorneys experienced in handling intellectual property cases in this District should be familiar with the program. All that is required of a plaintiff's counsel by the Local Rules is to notify his or her client and the defendant (or his or her counsel) of the availability of the program, to file a certificate indicating that the notification has been made, and later to file a notice of whether the clients have decided to engage in mediation. See Local Rule 16.3 and Appendix B: Procedures for Voluntary Mediation Program for Lanham Act Cases. Plaintiff's filings relating to the program were minimal. The first filing was a certificate of service. [Dkt 4.] The second filing was limited to stating that Defendant had never appeared to defend ...


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