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In E. Mishan & Sons, Inc. v. Novel Brands LLC, 2020 WL 9815178 (S.D.N.Y Feb. 13, 2020), the parties entered into a Final Judgment on Consent, where attorneys' fees were already agreed to and presumed.
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18-CV-02932 (VSB)(SN)
02-13-2020
E. MISHAN &SONS, INC, Plaintiff, v. NOVEL BRANDS LLC, Defendant.
REPORT AND RECOMMENDATION
SARAH NETBURN, UNITED STATES MAGISTRATE JUDGE
TO THE HONORABLE VERNON S. BRODERICK:
On August 29, 2018, this case was referred to my docket for an inquest on damages following a consent judgment establishing liability against Defendant Novel Brands LLC (“Novel Brands”). ECF No. 22. The Court recommends a total award of $454,277.32.
FACTUAL ALLEGATIONS
Plaintiff Emson is a New York corporation that markets and sells consumer products to wholesale customers and direct to consumers throughout the United States. Pl.'s Br. 1. Among the products Emson sells is a line of non-stick cookware and bakeware trademarked under the name “Gotham Steel.” Id. Gotham Steel cookware is made of aluminum and has a copper-colored non-stick coating on the cooking surface. Id. Emson also sells Gotham Steel cookware to retailers for resale to consumers and markets Gotham Steel on television for the direct response market and to drive additional sales at the retail store level. Id. Emson has spent over ten million dollars to advertise Gotham Steel cookware on television. Id. Gotham Steel's cookware packaging and inserts include an “As Seen On TV” logo. Id. at 2. Emson also displays the “As Seen On TV” logo on its websites and in print advertisements and other promotional materials. Id. According to Emson, the “As Seen On TV” status of a product enhances the status of a product in its retail customers' eyes and increases sales. Id.
Defendant Novel Brands marketed and sold a line of cookware products trademarked under the name “Royal Copper” and “Simply Copper” to retailers for sale to consumers and directly to consumers online. Id. These cookware products were in competition with Emson's Gotham Steel line. Id. Novel Brands sold at least three products - a 12” wok, a 12” round fry pan, and a 9.5” square pan - which, like the Gotham Steel pans, had a copper-colored cooking surface. Id. Novel Brands sold 12, 986 Simply Copper 9.5” square pans for gross revenue of $76,646.38, 13, 470 Simply Copper round pans for gross revenue of $58,845.60, and 27, 728 Royal Copper woks for gross revenue of $298,914.81. Novel Brands' total gross revenue from the sale of these products (the “Accused Products”) is $434,406.79. Id. (citing Novel Brands' Response to Plaintiff's First Set of Requests for Admission). According to Defendant, though, Novel Brands' expenses were such that it made no profit from the sale of these products. Def.'s Br. 15.
Each of Defendant's Simply Copper pans also included an “As Seen On TV” logo on the label. Pl.'s Br. 3. Defendant's website, too, displayed an image of a Royal Copper pan including the logo and a “sell sheet” for the Royal Copper wok using the “As Seen On TV” logo. Id. But unlike Emson, Novel Brands never actually advertised its products on TV. Id. Though Defendant created an infomercial for its wok product, the ad was never aired on television. Id. The owner of Novel Brands, Devon Israni, admitted in his deposition that he continued to sell pans with the “As Seen On TV” logo even after he had decided not to air the infomercial. Id. (citing deposition of Devon Israni). Novel Brands never created television advertisements for the round and square pans. Id.
Emson alleges that Novel Brands engaged in willful and intentional acts of false advertising in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125, and that the violation amounts to an exceptional case within the meaning of Section 35 of the Lanham Act, 15 U.S.C. § 1117, entitling Plaintiff to recover Defendant's profits from the sale of the Accused Products plus additional damages, reasonable attorney's fees, and the costs of this action.
PROCEDURAL HISTORY
Plaintiff commenced this action on April 3, 2018, for false advertising, unfair competition, false designation of origin, false description of fact, and misrepresentation of fact under the Lanham Act, 15 U.S.C. § 1125(a)(1) caused by, inter alia, Defendant's false use of the “As Seen On TV” logo. See Pl.'s Br. 5; Compl., ECF No. 1. The complaint was served on Defendant by personal service to Devon Israni on April 17, 2018. Pl.'s Br. 5. Defendant never filed an answer to the complaint and no attorney entered an appearance on behalf of Defendant until December 10, 2018, more than eight months after the complaint was filed. Id. On June 29, 2018, the Clerk of Court issued a Certificate of Default against Novel Brands and on August 3, 2018, Plaintiff filed an Order to Show Cause for Default Judgment. Id.; ECF No. 13. On August 6, 2018, the Honorable Vernon S. Broderick issued an order to show cause why default judgment should not be entered in favor of Plaintiff. Pl.'s Br. 5-6; ECF No. 19. That order and Plaintiff's supporting papers were served on Defendant the next day. Pl.'s Br. 6.
Judge Broderick held a hearing on August 29, 2018, which Novel Brands's counsel attended. Pl.'s Br. 6. Following the hearing, Judge Broderick entered a Consent Judgment providing that Defendant's “false advertising renders it liable under 15 U.S.C. § 1125 for claims One, Two and Three of the Complaint.” Pl.'s Br. 6; ECF No. 21. Judge Broderick also ordered injunctive relief against Novel Brands for its continued Lanham Act violations and awarded Plaintiff $15,000 in attorney's fees and costs up to the date of the Consent Judgment. Pl.'s Br. 6; ECF No. 21. Judge Broderick referred the matter to my docket for an inquest on the amount of damages to be awarded to Plaintiff. ECF No. 23.
On October 10, 2018, Plaintiff informed the Court that Defendant had not yet paid Plaintiff the $15,000 in attorney's fees and costs required by the Consent Judgment. ECF No. 26. Judge Broderick ordered that Defendant pay Plaintiff by October 26, 2018. ECF No. 27. Plaintiff filed a letter on October 31, 2019, informing the Court of Novel Brands's failure to comply with Plaintiff's discovery requests. ECF No. 28. Having still not received payment of its attorney's fees, Plaintiff filed a motion on November 5, 2018, to hold Defendant in contempt. ECF No. 30. On November 7, 2018, the Court held a discovery conference to address the discovery disputes raised in Plaintiff's October 31, 2018 letter. In light of the parties' agreement to resolve their disputes, the Court denied Plaintiff's contempt motion on November 7, 2018, ECF No. 33, and ordered: (1) that Defense counsel enter an appearance; (2) that Defendant make two catch-up payments of $5,000 in attorney's fees; and (3) that Defendant cooperate with Plaintiff's document and deposition requests. ECF No. 34.
Defendant again failed to comply with this order and the Court scheduled a conference for November 26, 2018, so that Defendant could show cause why sanctions should not be entered against it and its counsel. ECF No. 36. No one entered an appearance on behalf of Defendant, and no one appeared for Defendant at the at the November 26, 2018 hearing. Plaintiff's counsel were present and reported that Defendant had still not complied with any of the Court's orders. Pl.'s Br. 7; ECF No. 38, at 3.
On November 30, 2018, the Court ordered Novel Brands and its counsel to engage with the case in good faith and explain why they should not be sanctioned for disobeying two court orders to enter an appearance (ECF Nos. 34, 36), two orders to pay $10,000 in fees (ECF No. 27, 34), an order to comply with outstanding discovery demands (ECF No. 36), and an order to show cause (Id.). ECF No. 38. On December 10, 2018, Defendant's new counsel entered an appearance and filed a letter, ECF No. 41, suggesting that Defendants had not paid Plaintiff's attorney's fees because Defendant lacked adequate resources to do so. This explanation is inconsistent with the one Mr. Israni provided at his deposition, that he finally made the court-ordered payment to Plaintiff when he was “instructed to do so by our attorney” and that he could have made it in one payment “if he were instructed to do so.” Pl.'s Br. 12.
Plaintiff filed its Proposed Findings of Fact and Conclusions of Law on May 13, 2019. ECF No. 54. Defendant filed its Proposed Findings of Fact and Conclusions of Law in opposition on May 22, 2019. ECF No. 57. On June 21, 2019, Plaintiff filed a reply in support of its Proposed Findings of Fact and Conclusions of Law. ECF No. 58. Neither party has requested a hearing on the issue of damages.
DISCUSSION
I. Legal Standard
Liability has already been established in this case, but Plaintiff bears the burden to establish its entitlement to damages. See Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992). “As long as it ensured that there was a basis for the damages specified” a district court need not hold an evidentiary hearing in a damages inquest. See Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., Div. of Ace Young Inc., 109 F.3d 105, 111 (2d Cir. 1997).
II. Damages
The Consent Judgment entered by Judge Broderick establishes Defendant's liability under 15 U.S.C. § 1125 as to claims one, two and three of the complaint. See Consent J., ECF No. 21. Claim one is that Defendant engaged in false advertising under 15 U.S.C. § 1125(a)(1)(B) by advertising its Royal Copper cookware as “copper-infused” and “constructed from ultra-tough copper, ” even though the Accused Products contain no actual copper. Compl. ¶¶ 56-63. Claim two is that Defendant violated 15 U.S.C. § 1125(a)(1)(B) by falsely representing that its cookware products were “As Seen On TV.” Id. at ¶¶ 65-72. Claim three alleges unfair competition, false designation, false description of fact, and misrepresentation under 15 U.S.C. § 1125(a)(1)(A). Id. at ¶¶ 74-81. All three claims also allege that Defendant's conduct constitutes a “willful and extraordinary violation of Section 43(a) of the Lanham Act” and that this is “an exceptional case within the meaning of Section 35 of the Lanham Act, 15 U.S.C. §1117 entitling Plaintiff to recover additional damages, reasonable attorneys' fees, and costs of this action.” Id. at ¶¶ 64, 73, 81.
Section 35 entitles a plaintiff to recover “(1) defendant's profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action.” 15 U.S.C. § 1117(a). To establish a defendant's profits, the plaintiff need only prove defendant's gross revenues. “Defendant must establish all elements of cost or deduction claimed.” Id. According to the circumstances, the court may enter judgment “for any sum above the amount as actual damages, not exceeding three times such amount.” In its discretion the court may also enter judgment for an amount it finds to be just. Id.
A. Defendant's Profits
There are three rationales for the award of profits in a false advertising case: the need to (1) deter “future unlawful conduct;” (2) prevent Defendant's unjust enrichment; and (3) compensate Plaintiff for business it lost as a result of the false advertising. See Merck Eprova AG v. Gnosis S.p.A., 760 F.3d 247, 262 (2d Cir. 2014). Defendant's revenues from sales of the Accused Products is undisputed in this case. But the parties disagree about the amount of Defendant's profits, if any. Plaintiff argues that, except for commission fees of $7,324.60, Defendant failed to produce evidence of its losses during discovery and that Plaintiff is therefore entitled to $427,082.17 (total revenue minus undisputed costs). See Pl.'s Br. 23. Defendant claims the Royal Copper cookware products were a “total loss.” Def.'s Br. 7. According to Defendant, it had no profit on these products and instead lost $15,164.35, meaning Plaintiff is not entitled to any profits in this case. Id. at 33.
In support of its cost claim, Defendant provides a “profit and loss statement” as an exhibit to its Proposed Findings of Fact and Conclusions of Law. See Def's Ex. 1. The statement reflects gross expenses for all three Accused Products-the round pan, square pan, and wok- and breaks sales less costs down by product. Total expenses for all three products (for trademark and design approval, inbound and outbound freight expenses, storage and processing, and commercial and artwork costs) comes to $57,527.97. Id. The statement reflects sales of negative $16,855.79 for the round pan, negative $923.72 for the square pan, and positive $68,456.13 for the copper wok. Defendant deducts total expenses from gross income to get to the negative $15,164.35 number in profit. Id. Defendant also attaches backup documents including a spreadsheet reflecting sales (Def.'s Ex. 6) and others reflecting costs of legal fees (Def.'s Ex. 4), product purchases (Def.'s Ex. 7), inbound freight (Def.'s Ex. 3), outbound freight (Def.'s Ex. 1), graphics (Def.'s Ex. 2), commissions (Def.'s Ex. 9), and warehouse use (Def.'s Ex. 8).
Plaintiff argues that the Court should not accept Defendant's proof of costs because the documents-invoices and summary spreadsheets-“do not substantiate what it [Defendant] actually paid.” Pl.'s Reply 1. Instead, Plaintiff contends, Defendant should have produced cancelled checks or wire transfers as evidence of each transaction. See Pl.'s Br. 15 (citing Project Strategies Corp. v. National Communs. Corp., 948 F.Supp. 218, 221 (E.D.N.Y. 1996)). Plaintiff states that it asked Defendant for these materials in its Requests for Production and never received them. Pl.'s Reply 3. Defendant claims that it could have produced cancelled checks or wire information, but that Plaintiff never requested such documents. Def.'s Br. 29.
One of Plaintiff's document requests was for “[a]ll documents and things concerning Defendant's costs and expenses related to revenue received . . . from the sale of the Accused products.” Pl.'s Br. 15. Though not objected to by Defendant, this request was arguably overbroad and did not “clearly request” cancelled checks and wire transfer documents reflecting Defendant's costs. Another of Plaintiff's requests-for “[a]ll documents and things including, but not limited to . . . cancelled check, and wire transfer confirmations”-related to Defendant's cost of goods and not to other expenses. See Id. at 16. Defendant was never specifically asked to produce cancelled checks and wire transfer records reflecting costs of the type Defendant enumerates in the profit and loss statement.
Nonetheless, the burden to prove costs is Defendant's, not Plaintiff's. Whether or not Plaintiff requested these documents does not bear on whether Defendant has ultimately established its expenses. See Fendi Adele S.R.L. v. Ashley Reed Trading, Inc., No. 06-CIV-243 (RMB)(MHD), 2013 WL 12311011, at *1 (S.D.N.Y. Apr. 22, 2013) (citing Bambu Sales, Inc. v. Ozak Trading Inc., 58 F.3d 849, 854 (2d Cir. 1995). The Court need not account for deductions from Defendant's profits that Defendant does not prove. See Aris Isotoner Inc. v. Dong Jin Trading Co., No. 87-CIV-890 (RO), 1989 WL 236526, at *6 (S.D.N.Y. Sept. 22, 1989) (declining to deduct costs other than cost of goods).
Here, Defendant has proven deductions as to commissions ($7,324.60, which is undisputed), inbound and outbound freight costs ($11,288.52 and $6,536.59, respectively), and storage and processing fees ($12,590.85). For each of these categories, the backup materials provided are itemized by product and attributable only to the Accused Products. See Gucci Am., Inc. v. Guess?, Inc., 868 F.Supp.2d 207, 234 (S.D.N.Y. 2012) (profits are determined by “deducting costs incurred and attributable to the design, manufacture, and sale of the accused products”) (emphasis added). The Court disagrees with Plaintiff that Project Strategies Corp. v. National Communs. Corp., 948 F.Supp. 218, 221 (E.D.N.Y. 1996), controls to bar the Court from considering invoices as evidence of costs. See Malletier v. Artex Creative Int'l Corp., 687 F.Supp.2d 347, 357 (S.D.N.Y. 2010) (granting defendant's costs established by invoices). As for the other categories of Defendant's deductions - trademark approval, artwork, and cost of goods - Defendant has only partially proven them.
With respect to trademark approval costs, the profit and loss statement lists $3,250 in expenses: $1,500 for a legal bill on May 8, 2017, for “Royal Copper” and $1,750 for one on June 22, 2017, for “Royal Copper Wok.” Def.'s Ex. 1. The complaint lists only three products-the round pan, square pan, and wok-as Accused Products. See Compl. ¶¶ 24-26; Pl.'s Br. 14, n.8 (“Accused Products” was defined in Plaintiff's discovery requests). Accordingly, Plaintiff seeks to recover profits only from the sale of these three products. Pl.'s Br. 16. As Defendant's exhibits show, though, that other products were marketed and sold under the Royal Copper trademark including a knife, a cast iron pan, and a defrosting tray. See Def's Ex. 2. Because it is not clear what percentage of the “Royal Copper” trademark approval expenses can be allocated to the three Accused Products, Defendant has only established costs in this category as to the $1,750 attributed to the wok in the June 22, 2017 legal bill. See Def's Ex. 4.
Defendant's evidence of artwork costs is similarly flawed. The invoices from Michael Miceli Design LLC reflect charges for “Royal Copper 3 pc set, ” “Royal Copper Box, ” and “Royal Copper Sell Sheet, ” among other things. For the reasons described above, it is not clear which of these charges can be attributed to the Accused Products. See Def's Ex. 2. Even invoice charges for “Royal Copper Wok 3 pc” are unclear because other, non-Accused Products may have accounted for the other two products in the three-piece set. Reviewing the invoices, $770 in design costs is identifiably attributable to the Accused Products.
Defendant also spent $13,472.31 on an infomercial for “Copper Wok and Knife, ” proven up by an invoice from Tomfoolery, Ltd. Id. at 9. Even though it appears this charge can be traced to a single commercial, some amount of the $13,472.31 went to marketing the knife, which is not an Accused Product. “[W]hen a defendant's inadequate record-keeping is the cause of uncertainty regarding the amount of profit to be disgorged, district courts have broad discretion in determining how to calculate a reasonable approximation of these profits.” Gucci, 868 F.Supp.2d 207, 254 (S.D.N.Y. 2012) (citing Louis Vuitton S.A. v. Spencer Handbags Corp., 765 F.2d 966, 973 (2d Cir. 1985)). Because the Court cannot determine what portion of the $13,472.31 should be allocated to the Accused Product (the copper wok), the Court finds that 50% of the total payment is allocated to the knife and 50% is allocated to the wok. In total, Defendant has established $7,506.16 in artwork costs (($13,4272.31) + $770).
Finally, Defendant has not proven its cost of goods. Though it would ordinarily be entitled to this expense as a matter of course, see Project Strategies Corp. v. National Communications Corp., 948 F.Supp. 218 (E.D.N.Y. 1996), Defendant has not provided documentation sufficient to establish its cost of goods sold. The only evidence of Defendant's costs of goods is a summary spreadsheet, Def.'s Ex. 1, at 4, and three declarations prepared for this litigation by Defendant's owner, Devon Israni, Kunal Samtani (the director of TVP Developments Limited, which owns Defendant's supplier TV Direct LLC), and Dean Israni (the owner of another of Defendant's suppliers, In Demand Marketing). The declarations are insufficient evidence of costs. All three declarations were prepared for the purposes of this inquest and are not supported by documentary evidence. See Bambu Sales, 58 F.3d at 854, abrogated on other grounds by 4 Pillar Dynasty LLC v. New York & Co., Inc., 933 F.3d 202 (2d Cir. 2019) (defendant did not prove costs by relying on corporate president's testimony and “a smattering of bills”). Moreover, the evidence provided does not address the concern raised by Plaintiff that Novel Brands may have purchased woks from TV Direct LLC, sold them to In Demand Marketing, and then repurchased them from In Demand Marketing at a higher price to benefit In Demand Marketing, which is owned by Devron Israni's uncle. See Pl.'s Reply 5 (citing deposition of Devon Israni). The summary document shows purchases from TV Direct LLC and In Demand Marketing, but it is unclear whether, as Plaintiff alleges, Defendant purchased and resold the same woks twice. Though the Court assumes that Defendant spent some amount of money to purchase the goods it sold, Defendant has not carried its burden to establish the amount of this expense. See M.B.S. Love Unlimited, Inc. v. Park's Sportswear Corp., No. 90-CIV-0311 (LBS), 1990 WL 276561, at *3 (S.D.N.Y. Mar. 28, 1990) (denying deduction of cost of goods sold where defendants “failed to furnish any documents or credible testimony” about their expenses). Accordingly, Defendant is not entitled to a deduction for its cost of goods.
Plaintiff may recover Defendant's gross revenue from the sale of the Accused Products, ($434,406.79) less proven deductions ($46,996.72) for a total of $387,409.08 in profits.
B. Plaintiff's Damages
In addition to a defendant's profits, 15 U.S.C. § 1117 entitles a plaintiff to damages it sustained as a result of the violation. The district court has “some degree of discretion in shaping” appropriate relief and once causation is established the court “may engage in some degree of speculation in computing the amount of such damages.” Merck Eprova AG v. Brookstone Pharm., LLC, 920 F.Supp.2d 404, 428 (S.D.N.Y. 2013) (citations omitted). The burden is on Plaintiff to establish causation between Defendant's false advertising and resulting damages. See Dependable Sales & Serv., Inc. v. TrueCar, Inc., 311 F.Supp.3d 653, 656 (S.D.N.Y. 2018).
Plaintiff claims it was injured by Defendant's false advertising in the amount of Plaintiff's prorated expenses on legitimate advertising of its products. Pl.'s Br. 17. Because Plaintiff sold many more units of its copper pan product-hundreds of thousands according to the complaint-than Defendant did, Plaintiff argues that its damages are equal to the amount it spent on advertising per dollar in revenue multiplied by Defendant's revenue from sale of the Accused Products. Id. at 119. But Plaintiff has not established a causal link between its advertising expenses and Defendant's misconduct. Though prevailing plaintiffs in false advertising cases are often granted damages equal to the amount spent on corrective advertising to combat defendant's false representations, see, e.g., Mobius Mgmt. Sys., Inc. v. Fourth Dimension Software, Inc., 880 F.Supp. 1005, 1023 (S.D.N.Y. 1994), an award equal to the prorated amount of all of Plaintiff's advertising expenses is not justified here. Novel Brands admittedly sold very few products relative to Plaintiff, and Plaintiff has not put forth evidence that it had to advertise specifically to correct Defendant's misrepresentations. The Lanham Act allows the court to assess damages “for any sum above the amount found as actual damages, not exceeding three times such amount.” 15 U.S.C. § 1117(a). However, because Plaintiff has not put in evidence that it suffered any damages due to Novel Brands's false advertising, Plaintiff is not entitled to compensatory damages.
C. Costs of the Action
Section 35 of the Lanham entitles Plaintiff to costs as part of the damages calculation. 15 U.S.C. § 1117(a). Emson claims it incurred costs in this action in the amount of $7,672.77. As detailed in Declaration of Alan Federbush which accompanies Plaintiff's Findings of Fact and Conclusions of Law, these costs are for items that are ordinarily allowed as court costs, including fees for filing, research services, service of process, PACER charges, and lab testing. See, e.g. Merck Eprova AG v. Gnosis S.P.A., No. 07-CIV-5898 (RJS), 2013 WL 364213, at *6 (S.D.N.Y. Jan. 31, 2013), aff'd, 760 F.3d 247 (2d Cir. 2014) (including sample testing in recoverable costs). Plaintiff also includes investigator fees in its costs, which have been allowed as part of attorney's fees and/or costs in other Lanham Act cases. See Silhouette Int'l Schmied AG v. Vachik Chakhbazian, No. 04-CIV-3613 (RJH)(AJP), 2004 WL 2211660, at *4 (S.D.N.Y. Oct. 4, 2004) (collecting cases). The Court finds these costs to be reasonable and therefore orders them taxed against Defendant.
III. Attorney's Fees
Reasonable attorney's fees may be awarded to a successful plaintiff in “exceptional cases” in an action brought pursuant to the Lanham Act. See 15 U.S.C. § 1117(a). An exceptional case is “one that stands out from others with respect to the substantive strength of a party's litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated.” Sleepy's LLC v. Select Comfort Wholesale Corp., 909 F.3d 519, 531 (2d Cir. 2018) (citing Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545 (2014)). The Court finds that this case is exceptional, warranting an award of attorney's fees incurred from the date of the entry of the consent judgement. First, though Defendant argues that their conduct has not been found to be willful, Def.'s Br. 31, the consent judgment holds that Defendant is liable for counts one, two and three of the Complaint. Consent J. at 1. Each count provides that Defendant acted willfully. Compl. ¶¶ 64 (count one), 73, (count two), 81 (count three). Accordingly, contrary to Defendant's contention, Defendant consented to a judgment that its violation was willful.
Second, Defendant's litigation conduct-failing to answer the complaint, failing, repeatedly, to respond to discovery requests, and failing to comply with the consent judgment- “frustrat[ed] the litigation process at every turn” and displayed an “utter lack of respect for the judicial process.” See Merck Eprova AG v. Gnosis S.p.A., 901 F.Supp.2d 436, 463 (S.D.N.Y. 2012), affd, 760 F.3d 247 (2d Cir. 2014) (awarding attorney's fees). Taken together, Defendant's willful false advertising and litigation conduct render this case exceptional, justifying an award of attorney's fees since August 30, 2018.
Defendant has not objected to the amount Plaintiff requests in attorney's fees other than by stating that the fees “appear to be egregious and exorbitant for what is a relatively simple matter.” Def.'s Br. 31. To the extent this “simple” case was made complicated, it is because of Defendant's behavior.
I find Plaintiff's attorneys' rate-a blended rate of $317.74 per hour-to be reasonable in this case given that each of the three attorneys working on this matter had over ten years of IP litigation experience and worked diligently in spite of Defendant's failure to cooperate. See Romanowicz v. Alister & Paine, Inc., No. 17-CV-8937(PAE)(KHP), 2018 WL 4762980, at *7 (S.D.N.Y. Aug. 3, 2018) (collecting cases awarding between $350 and $500 per hour in copyright cases). Finally, Plaintiff's counsel billed a total of 186.3 hours to this case since August 30, 2018. In that time, Plaintiff conducted the deposition of Devon Israni, drafted several discovery-related motions and letters, and attended multiple conferences. See Federbush Decl. ¶ 3. I conclude that Plaintiff's counsel billing records appear contemporaneous and are not defective by being vague or engaging in block billing. See Federbush Decl., Ex. 1. I further find Plaintiff's counsel's hours to be reasonable in light of the work performed. Accordingly, Plaintiff is entitled to $59,195.47 in attorney's fees.
CONCLUSION
Plaintiff should be awarded (1) $387,409.08 in Defendant's profits; (2) $7,672.77 in costs; and (3) $59,195.47 in attorney's fees, for a total award of $454,277.32.
NOTICE OF PROCEDURE FOR FILING OBJECTIONS TO THIS REPORT AND RECOMMENDATION
The parties shall have fourteen days from the service of this Report and Recommendation to file written objections pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure. See also Fed.R.Civ.P. 6(a), (d) (adding three additional days when service is made under Fed.R.Civ.P. 5(b)(2)(C), (D), or (F)). A party may respond to another party's objections within fourteen days after being served with a copy. Fed.R.Civ.P. 72(b)(2). Such objections shall be filed with the Clerk of the Court, with courtesy copies delivered to the chambers of the Honorable Vernon S. Broderick at the United States Courthouse, 40 Foley Square, New York, New York 10007, and to any opposing parties. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b). Any requests for an extension of time for filing objections must be addressed to Judge Broderick. The failure to file these timely objections will result in a waiver of those objections for purposes of appeal. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b); Thomas v. Arn, 474 U.S. 140 (1985).