United States District Court, N.D. Illinois, Eastern Division
August 22, 2005.
HOME RATERS, INC., Plaintiff,
THEODORE BLUMENTHAL, Defendant.
The opinion of the court was delivered by: JOHN W. DARRAH, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff, Home Raters, Inc., filed suit against Defendant,
Theodore Blumenthal, alleging copyright infringement. On February
24, 2005, the Court entered judgment against the Defendant in the
amount of $1,000.00 based on Plaintiff's Acceptance of
Defendant's Federal Rule of Civil Procedure 68 Offer of Judgment.
The issue of Plaintiff's entitlement to costs, including
attorney's fees, was continued. On April 11, 2005, the Court
ruled that Plaintiff was entitled to reasonable costs, including
attorney's fees. Presently pending before the Court is
Plaintiff's Bill of Costs.
Plaintiff seeks $185.00 in filing, service of summons, and
subpoena fees. These fees are reasonable and are awarded.
Plaintiff seeks $30.00 in messenger fees. Messenger fees are
generally considered part of overhead and are generally not
recoverable. See Bass v. Zeta Consumer Prod., 1999 WL 1129603
(N.D. Ill. Dec. 3, 1999); In re Abbott Laboratories Omniflox
Prod. Liability Litig., 1997 WL 162891 (N.D. Ill. March 26,
1997). Accordingly, the $30.00 for messenger fees is not
Lastly, Plaintiff seeks $7,000.00 in attorney's fees, including
$27.00 in paralegal fees. Defendant objects to the amount of the
fees, arguing that he cannot review the reasonableness of the
fees because Defendant provided a redacted description of the
requested fees. Plaintiff provided a redacted copy in light of an ongoing case in state court between
the parties and provided a non-redacted copy to the Court for in
camera inspection. Defendant also objects to the amount of
requested fees in light of the limited amount of recovery.
The party seeking attorney's fees bears the burden of proving
the reasonableness of the hours worked and the claimed hourly
rates. Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)
(Hensley). The starting point for determining the amount of
reasonable fees is the number of hours reasonably expended on the
case multiplied by a reasonable hourly rate. Hensley,
461 U.S. at 433. This product is commonly referred to as the "lodestar."
Spegon v. Catholic Bishop of Chicago, 175 F.3d 544, 550 (7th
Cir. 1999) (Spegon). The court may then decrease or increase
the lodestar amount by considering a variety of factors, the most
important of which is the "degree of success obtained." See
Hensley, 461 U.S. at 434-36.
Plaintiff's attorney seeks payment for 23.6 hours of service
and 0.2 hours of work for a paralegal. The requested fees include
work prior to the filing of the Complaint, preparing the
Complaint, court appearances, and negotiations to settle the
case. Defendant contends that time spent was unreasonable because
a simple cease and desist letter would have resolved the case.
However, Plaintiff's Complaint alleges that Defendant was a
previous employee of Plaintiff, that Plaintiff began operating a
directly competitive business, and that Plaintiff was wrongfully
using Plaintiff's copyrighted work in his business. While the
Complaint alleged one claim of copyright infringement, other
claims may have materialized following discovery. Based on these
allegations, it cannot be concluded that Plaintiff's claim could
have been resolved without filing a lawsuit and simply
negotiating a settlement. Cf. Spegon, 175 F.3d at 551 (reducing
number of hours awarded based on court's acceptance of unchallenged representation that
claim could have been resolved without filing suit and simply
negotiating a settlement).
After determining the reasonably expended hours, a court must
determine a reasonable hourly rate. Hensley, 461 U.S. at 433.
The reasonable hourly rate is based on the "market rate" for the
services rendered. See People Who Care v. Rockford Bd. of
Educ., 90 F.3d 1307, 1310 (7th Cir. 1996). Counsel seeking fees
has the burden of proving the market rate. Once counsel
establishes his or her rate, the burden shifts to the opposing
party to demonstrate why the rate should be lower. Spegon,
175 F.3d at 554.
An attorney's market rate is the rate that lawyers of similar
experience and ability in the community normally charge their
paying clients for the same type of work. Spegon,
175 F.3d at 555. Counsel's actual billing rate for comparable work is
presumptively appropriate for use as the market rate. If this
cannot be determined, the next best evidence of counsel's market
rate is evidence of rates that similarly experienced attorneys in
the community charge paying clients for similar work and evidence
of fee awards that attorneys have received in similar cases.
Spegon, 175 F.3d at 555.
Plaintiff's attorney seeks an hourly rate of $295.00 per hour,
and the paralegal seeks $135.00 hour. In support of the
attorney's requested rate, Plaintiff has attached the American
Intellectual Property Law Association Economic Survey 2003,
showing that the requested rate of $295.00 is the median amount
for all attorneys in intellectual property in the Chicago area
and is low for a partner. Defendant has not presented any
evidence disputing the requested hourly rates. The requested
rates are reasonable.
Following the lodestar determination, a court may adjust the
award in light of plaintiff's "level of success." Spegon,
175 F.3d at 557 (citations omitted). In a case involving a single
claim or related claims, a court must ask whether "the plaintiff
achieve[d] a level of success that makes the hours reasonably
expended a satisfactory basis for making a fee award." Hensley,
461 U.S. at 434. In doing so, a court "should focus on the
significance of the overall relief obtained by the plaintiff in
relation to the hours reasonably expended on the litigation.
Hensley, 461 U.S. at 435. If the plaintiff has achieved only
partial or limited success, the lodestar may be an excessive
amount. In such a case, the court, in its discretion, may reduce
the modified lodestar amount to reflect the degree of success
obtained. Hensley, 461 U.S. at 436-37.
In the instant case, Plaintiff alleged one count of copyright
infringement and did not seek a specified amount of damages
because it was unable to ascertain the full extent of the
monetary damages at the time the Complaint was filed. Plaintiff
sought statutory damages, increased damages for willful
infringement and attorney's fees and costs. The settlement
reached between Plaintiff and Defendant was $1,000.00 and
reasonable attorney's fees.
The $1,000.00 recovered by Plaintiff represents limited success
in relation to the hours expended on the litigation. Plaintiff
spent seven times the amount he ultimately accepted to settle his
claim. In light of the limited success of Plaintiff's claim, a
reduction of the lodestar by fifty percent is appropriate. See
Spegon, 175 F.3d at 558-59 (reduction of lodestar by fifty
percent was not an abuse of discretion in light of limited
success of the lawsuit). Accordingly, Plaintiff is awarded
$3,500.00 in attorney's fees.
For the foregoing reasons, Plaintiff's Bill of Costs is granted
in part and denied in part. Plaintiff is awarded $3,685.00 in
fees and costs.
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