Opinion
Civil Action No. 95-2078.
February 28, 2001.
William M. Wycoff, Kimberly A. Brown, Thorp Reed Armstrong Pittsburgh, PA., Counsel for Plaintiff.
David E. Springer, David E. Springer, Skadden, Arps, Slate, Meagher Flom Chicago, IL., Counsel for Defendant.
MEMORANDUM OPINION AND ORDER
A. Introduction
This is a dispute over the business relationship between the parties to a series of agreements to sell paint. In February 2000, a jury rendered a mixed verdict on nine claims and counterclaims that spelled some success and some failure for each side. Pretrial rulings by the court had disposed of a number of other claims that did not reach the trial stage.
The relationship between the parties to a large extent was governed by several contracts. A provision in the main contract entitled the "prevailing party" in any legal dispute to costs and attorneys' fees from the other. The questions pending now are which side prevailed, and how much should the attorneys for that side be paid? As with most attorneys' fee matters, the answer is of some moment. The parties have filed motions in which defendants ("Zurawin") seek fees and costs of $1,839,010, and plaintiffs ("PPG") seek $845,189. This is on a jury award to Zurawin of $424,991 on his claims arising out of the contract in question (though he argues that $320,000 in jury awards on other claims should be counted in measuring his success). The jury awarded PPG nothing on its contract claims, although PPG successfully defended itself before trial on a number of other claims. These will be reviewed in detail below.
Also pending is Zurawin's motion for prejudgment interest, which we also decide below so that judgment may finally be entered.
B. The Provision Regarding Attorneys' Fees
PPG and the defendant corporation controlled by Zurawin, National Hardlines Marketing Associates, Inc., executed an agreement dated December 15, 1989 ("Agreement"), that contains the following as its last substantive paragraph.
In the event of any dispute between NHMA and PPG with respect to the terms and conditions of this Agreement, which dispute shall result in legal proceedings, upon any final judicial determination of any such legal proceedings, the prevailing party shall be entitled to receive, in addition to the judgment awarded, reimbursement for all reasonable costs (including reasonable attorney's fees) incurred in connection with such legal proceedings.
Motion to Recover Attorneys' Fees and Costs, Doc. No. 185, Exhibit A at ¶ XIX. The agreement is controlled by Pennsylvania law "as such laws are applied to contracts between residents of Pennsylvania." Id. ¶ XVII.
PPG argues that it is the prevailing party because its position succeeded on nine of thirteen claims, and, by its reckoning, 88% of the money in controversy. Zurawin asserts that he is the prevailing party because he was awarded a substantial portion of the relief sought, borrowing the test from the jurisprudence governing the award of fees in civil rights cases under 42 U.S.C. § 1988(b), and citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983).
C. Determination of Prevailing Party
1. Pennsylvania Law
Neither team of lawyers, who we know from pretrial preparation and trial leave few stones unturned, was able to find authoritative Pennsylvania law on the definition of prevailing party for contractual fee-shifting provisions. The court fared no better in its research. While one might not have expected this to be the status of relevant law, in the words of one treatise, the contract exception to the American Rule "has provided a relatively insignificant body of law in the area of attorney fees." 1 Derfner Wolf, Court Awarded Attorney Fees 1-29 (2000).
Both sides did cite Gardner v. Clark, 503 A.2d 8 (Pa.Super. 1986), in support of their respective positions. The Superior Court in Gardner held that "a party prevails if he or she succeeds in obtaining substantially the relief sought," with a "cf." or "compare" citation to Hensley. 503 A.2d at 10. Gardner, however, involved a statutory entitlement to attorneys' fees for debtors who "prevail" in actions to enforce confessed judgments. The context of that case thus does not fit this one. We therefore find that Pennsylvania law is unsettled on the definition of "prevailing party" in a contractual fee-shifting case.
When the Commonwealth's law on a particular issue is not settled, our own controlling court of appeals tells us that we must predict the position the Supreme Court of Pennsylvania would take. Clark v. Modern Group Ltd., 9 F.3d 321, 326 (3d Cir. 1993). Where we look to inform our prediction, though, also appears somewhat unsettled. In 2-J Corp. v. Tice, 126 F.3d 539, 541 (3d Cir. 1997), the court of appeals said that "`[i]n attempting to forecast state law, we must consider relevant state precedents, analogous decisions, considered dicta, scholarly works, and any other reliable data tending convincingly to show how the highest court in the state would decide the issue at hand,'" (quotingAloe Coal Co. v. Clark Equipment Co., 816 F.2d 110, 117 (3d Cir. 1987)). A more recent enunciation of the standard, likewise relying on an earlier case, states:
In predicting how a matter would be decided under state law we examine: (1) what the Pennsylvania Supreme Court has said in related areas; (2) the decisional law of the Pennsylvania intermediate courts; (3) federal appeals and district court cases interpreting the state law; and (4) decisions from other jurisdictions that have discussed the issues we face here. See Wiley v. State Farm Fire Cas. Co., 995 F.2d 457, 459-60 (3d Cir. 1993).Boyanowski v. Capital Area Intermediate Unit, 215 F.3d 396, 406 (3d Cir.), cert. denied, 148 L.Ed.2d 485 (2000). Because the latter formulation is narrower, reaffirmed more recently, was cited by Zurawin, and satisfies the lawyer's magnetic attraction to finite lists, we will follow it here.
2. Prevailing Party in Civil Rights and Contract Cases
Both this list of sources and the parties' arguments require us first to answer the question of what areas are related to contractual fee-shifting provisions, and specifically whether we should borrow the definition of "prevailing party" from the civil rights context. We have decided against that course, tempting as it is because of the ease of reference to plentiful controlling authority, and the certainty that such course superficially would bring.
We find that the award of fees is motivated by significantly different interests based on the merits of the underlying claims. "The purpose of § 1988 is to ensure `effective access to the judicial process' for persons with civil rights grievances."Hensley, 461 U.S. at 429 (quoting legislative history). The test for prevailing party before the Court in Hensley approximates the standard Zurawin asks us to apply, that is, attainment of some of the benefit pursued by the plaintiff. Id. at 433. The Court characterized this as a "generous formulation." Id. See also Hernandez v. Kalinowski, 146 F.3d 196, 199 (3d Cir. 1998) (one purpose of section 1988 is "to encourage litigation to enforce the provisions of the civil rights acts and constitutional civil rights provisions").
The subjects of civil rights litigation are well known. They include, for example, infringement of voting rights; loss of public employment because of political views; de facto segregation in schools; inhumane conditions in prisons; unreasonable searches; and mistreatment by police. The interests at stake are fundamental and equal for all citizens.
These are not like the interests that arise in commercial contracts. In the court's experience, commercial contracts are not written or entered into to uphold the fundamental rights of the parties as citizens, or to serve some high public purpose. Instead, commercial contracts generally are entered into to provide business opportunities and profits for one or both parties. More importantly, the evidence here about the parties' relationship supports this interpretation. The parties had regular dealings at high levels over the course of five years for the purpose of using Zurawin to market PPG's coatings to home improvement retail stores. At bottom, the evidence demonstrated that both sides made the agreements at issue to sell more paint, stain, and accessories. A successful outcome to these agreements would mean substantial economic benefits for both sides. Fundamental civil liberties were not at stake.
An interesting if irrelevant side note is that the right to make contracts itself was singled out by the Reconstruction Congress as a fundamental right of citizenship. 42 U.S.C. § 1981 (a).
In addition, the manner that an aggrieved person goes about protecting these respective rights may not be the same. Court enforcement is often the only way an individual can compel compliance with civil rights obligations, and it is not unusual to see cases pursued over principle. The principles are important enough to protect with attorneys' fee schemes that assure vigilant, active intervention by the forces that attorneys can bring to bear.
Commercial disputes, on the other hand, are often a matter of business judgment, not principle, and are frequently resolved (or are at least suited for resolving) in ways other than litigation. We take further support from the logic of a recent decision by the Seventh Circuit distinguishing fee-shifting statutes from fee-shifting contracts. Medcom Holding Co. v. Baxter Travenol Lab. Inc., 200 F.3d 518, 521 (7th Cir. 1999).
In addition, civil rights injuries are a species of tort. Heck v. Humphrey, 512 U.S. 477, 483 (1994). Pennsylvania does not use tort measures for contract damages. See, e.g., Bash v. Bell Telephone Co., 601 A.2d 825, 830 (Pa.Super. 1992) ("in this case, the parties' obligations are defined by the terms of the contract, and not by the larger social policies embodied in the law of torts").
Finally, Zurawin loses credibility because his attachment to a civil rights analysis is half-hearted. He advocates the associated rules for determining prevailing party, for example, but abandons the scheme and refers to contract principles when it comes to possible limitations on the hourly rates of his attorneys. Zurawin's Memorandum in Opposition to PPG's Motion for Attorneys' Fees, Doc. No. 187, at 3 n. 1.
For these reasons, we will not borrow from civil rights cases when looking for areas of established or emerging law related to contractual fee-shifting in predicting the position of the Pennsylvania Supreme Court.
3. Predicting Pennsylvania Law
We now will proceed to the Boyanowski factors. With regard to what the Pennsylvania Supreme Court has said in related areas, we conclude that civil rights-type claims should not be considered as related. Into the category of civil rights we will add cases involving statutory provisions for attorneys' fees to the prevailing party, such as Gardner, which the legislature deemed useful or necessary to protect a potentially vulnerable class. We think these are more closely connected to civil rights than to commerce. With that scope, neither the parties nor the court has found Pennsylvania Supreme Court precedent in related areas from which we might draw guidance in rendering our decision.
With regard to the decisional law of Pennsylvania intermediate courts, we likewise find no guiding authority.
With regard to the federal cases interpreting state law, we reach the same conclusion. We have excluded state statutes using the term "prevailing party," and there are no proper cases which a federal court could interpret. This branch of the inquiry yields no solution.
With regard to decisions from other jurisdictions, that is, other state courts, this is a broad area in which to cast a net. A basic search in this sea of authority did not produce a definitive answer. Some courts have decided in contractual fee cases that if neither party wholly prevails, it is within the court's discretion to award no fees. Mitchell v. Dahlberg, 547 N.W.2d 74, 80 (Mich.App. 1996); Fellowship Tabernacle v. Baker, 869 P.2d 578, 580-81 (Idaho App. 1994). The more prevalent view, however, seemingly best expressed by courts of Washington state, is that if neither side wholly prevails in a contract case, the party that substantially prevails should be awarded fees. Lane v. Wahl, 6 P.3d 621, 624-25 (Wash.App. 2000); Marassi v. Lau, 859 P.2d 605, 607 (Wash.App. 1993). Substituting the vague phrase "substantially prevails" for the vague word "prevails" does not do much for a court looking for specific ways to measure a split result. The Lane court at least states that "substantially prevails" depends on who succeeded on the central issue in the case, and who obtained greater relief. 6 P.3d at 625. These are guides a court can practically apply, with one note of caution.
Much of the precedent we reviewed speaks in terms of which side obtains greater relief. "Relief" implies a change for the better that results from the litigation process. A defendant's avoidance of liability does not seem to fit comfortably within the definition of "relief"; it may mean no change at all, but simply a preservation of the status quo. We believe avoidance of liability nonetheless must be considered in determining the prevailing party. When a party faces the risk of losing something valuable through the legal process, and escapes that risk, such an outcome is positive, and therefore should be considered a success. For example, a defendant which has no counterclaims but successfully defends nine out of ten of the plaintiffs claims generally should be considered as prevailing. Thus, while our case does involve claims by both sides for affirmative relief, our idea of relief will encompass a defending party's avoidance of liability. See Marassi, 859 P.2d at 607.
So what will the court look to in determining prevailing status under Pennsylvania law? The exercise of considering how civil rights law should not apply has shed some light on the question. Civil rights cases frequently occupy the world of ideals and high principles. These principles rest on overarching values, which are usually defined by courts. In contract cases, by contrast, courts are bound to view the terms of the contract in the context in which the parties operate.
In the construction of any contract, certain principles must guide us: (a) if there is any doubt as to the meaning of a term of a contract, such term should `receive a reasonable construction and one that will accord withe the intention of the parties; and, in order to ascertain their intention, the court must look at the circumstances under which the [contract] was made':. . . . (b) in construing a contract we seek to ascertain what the parties intended and, in so doing, we consider the circumstances, the situation of the parties, the objects they have in mind and the nature of the subject matter of the contract:. . . .United Refining Co. v. Jenkins, 189 A.2d 574, 580 (Pa. 1963) (citations omitted). We therefore consider how the parties would use the term "prevailing party" in a general commercial context.
The performance of a business is frequently measured with numbers and statistics: stock price, revenues, debt, number of accounts, sales volume, deals closed, profits, and dozens of other data. These figures can then be compared to the corresponding figures of others in the industry to establish a business's place among its competitors. The very Agreement in question, for example, is based on particular measurements of business activity: enumerated retail stores to solicit, products to be sold, rate of commission, amount of returns, and the like.
In this sort of environment, it is consistent to determine prevailing party along the lines suggested by PPG. That is, if a convenient and useful way to compare commercial enterprises is through basic numbers measuring performance, a court could properly use such an approach to determine the prevailing party in lawsuit involving the contract containing that phrase. Consistent with this view, the court will compare the number of relevant contract claims on which each side succeeded at any point in the case, (success to include a finding of no liability). The monetary amount of damages sought and avoided is another useful measure to compare performance.
This method offers several advantages. A party is more likely to limit its claims to ones it has a realistic chance of winning, and to avoid piling on for intimidating effect, if it knows that losing any claims increases its potential for attorneys' fee liability. This test also gets around the notion of determining how central a claim is to the litigation. While no doubt a useful concept when there is no other method for determining prevailing party, it may be hard for parties to predict what a court will deem central. If we look at claims and amounts, however, the concept of centrality mostly takes care of itself — the most valuable claims generally will be the ones central to the litigation.
Finally, the parties did not argue that the term "prevailing party" is ambiguous, nor did they offer extrinsic evidence as to its meaning. We therefore find this argument waived by each side. Instead, they each contend that the term has a particular meaning that favors them. This posture, even with the digging the court has done to construe the phrase, does not mean it is ambiguous as a matter of law. The fact that the meaning has taken some effort to ascertain is not the same as being ambiguous, that is, reasonably capable of two different meanings. In essence, the parties have asked the court to apply one of two interpretations to this contract term: a civil rights interpretation or a business interpretation. We heard more than enough evidence during three weeks of trial to make this choice.
4. Not All Claims Should be Included
Having focused our analysis in part on the parties' claims and their results, we must decide which claims we will consider. Zurawin argues that the court should examine all claims and counterclaims in the case to determine the prevailing party. PPG responds that only the claims arising out of the December 1989 Agreement should enter the court's calculations.
We find that the fee-shifting provision in question, with a little scrutiny, settles at least this question. The relevant language states that "[i]n the event of any dispute. with respect to the terms and conditions of this Agreement, which dispute shall result in legal proceedings . . . the prevailing party shall be entitled to receive . . . reimbursement for all reasonable costs (including reasonable attorney's fees) incurred in connection with such legal proceedings." (Emphasis added). Thus, entitlement to fees depends on a dispute over "the terms and conditions of this Agreement" which leads to legal proceedings. The legal proceedings covered by this arrangement are ultimately qualified — "such legal proceedings" — in a way that directly relates back to the legal proceedings spawned by the dispute over "terms and conditions." The "in connection with" language does not expand this provision to anything the parties choose to litigate, so long as there is a "terms and conditions" claim in the case somewhere.
Thus, by extension, the parties have excluded from their fee-shifting deal disputes over matters other than "the terms and conditions of this Agreement." This immediately brings to mind Zurawin's $70,000 verdict for defamation. Doc. No. 149, ¶ 7. PPG's defaming of Zurawin admittedly came about through the relationship created by the December 1989 Agreement. Just as assuredly, this tort has nothing to do with its "terms and conditions." Fees related to the defamation claim therefore will not be reimbursed. The same conclusion applies to any claims other than those "with respect to the terms and conditions" of the December 1989 Agreement.
Before we collect the claims related to the Agreement, we must explain another characteristic we will use to determine which claims create fee liability. The fee provision applies to disputes which result in "legal proceedings." Certainly a cause of action decided by a jury meets this definition. There were a number of other claims that did not reach a jury, however; these will also be counted. Formal invocation of court decisionmaking process (by making a claim) is the dividing line we think the parties have chosen. A dispute that results in an exchange of correspondence, for example, would not qualify. It is a dispute, but an informal one. If the dispute was identified in a court of law, however, and the opposing party put at risk of loss, it conclusively reached the status of "legal proceeding." Nothing that happened to the claim afterward can reverse that status.
There is logical support for this interpretation in that corporations must hire a lawyer to represent them in court, making a claim in a lawsuit an appropriate trigger for lawyers' fees. See Walacavage v. Excell 2000, Inc., 480 A.2d 281 ( Pa. Super. 1984). Another factor to consider is that a claim in a lawsuit must have some confirmed basis in fact and law, Fed.R.Civ.P 11(b), and so is validated by rule as serious enough to require legal help. Accordingly, pursuant to the Agreement's fee-shifting provision, any claim that appears in the record, whether decided by a jury, by motion, or withdrawn, carries equivalent weight in the fee inquiry, and may generate fee liability.
5. Comparing Success on Claims
Having defined which claims we will consider, we will now compare the results, starting with the jury verdict. Question number one of the verdict comprises four claims. Doc. No. 149. The jury found two of these for Zurawin and two for PPG. We instructed the jury that question number 5 of the verdict was related to the December 1989 Agreement. The jury rendered this count in favor of PPG. Finally, PPG made two claims under the Agreement, questions 9 and 11, both of which the jury resolved in favor of Zurawin.
PPG made certain claims in the form of requests for declaratory judgment that overlapped with Zurawin's claims for substantive relief. We instructed the jury, and so find now, that these are not to be decided separately, and were resolved by the verdict on the substantive claims. The jury thus decided four claims in favor of Zurawin and three in favor of PPG. Doc. No. 149.
The claims resolved before trial were not similarly divided. In his Amended Counterclaim, filed sixteen months after this case began, Zurawin sought $900,000 in commissions lost for PPG's alleged failure to honor a two year extension of the Agreement. Doc. No. 33 at 21. This claim was denied as a matter of law immediately before trial started. Trial Transcript for 1/31/00, Doc. No. 160, at 35. Zurawin also made claims for $320,000 for unpaid commissions on sales of PPG's Olympic stains to HomeQuarters; $30,000 for unpaid commissions on sales to Montgomery Ward; and $80,000 for unpaid commissions on sales to Rickels. Doc. No. 33 at 21. PPG's Rule 50 motion was granted on all these claims immediately before closing arguments. Trial Transcript for 2/16/00, Doc. No. 169, at 31.
PPG also argues (but did not cite to the record) that still other claims were made and abandoned by Zurawin. A review of Zurawin's first Answer and Counterclaims indeed shows claims for $120,000 for unpaid commissions on sales to Clorox; $90,000 for unpaid commissions on sales to Ames; and a "margin guarantee" to Montgomery Ward that resulted in the loss of an undetermined amount of commissions. Doc. No. 9 at 22. We can confirm that these claims did not make it to trial.
These results leave PPG with having avoided liability on a total of at least ten claims related to the Agreement. Zurawin's position succeeded on four claims. Zurawin's inability even to collect sufficient evidence on at least half his relevant contract claims underlines the risk both parties faced in selecting which disputes to transform into "legal proceedings." Zurawin stood to collect a substantial jury award by asserting these claims in a lawsuit, however. It is not incongruous to find that he also faced a contractual risk when most of those claims dissolved.
With regard to the monetary values associated with these claims, the court will not apply a strict accounting, since the amount sought is changeable throughout the course of the lawsuit, depending on what discovery unearths. We fully recognize that claimed damages in complaints can change over time. Still, contract damages stated in federal court pleadings must have a reasonable basis in fact, and so need not be ignored in determining which side prevailed in its quest for vindication. Thus, we will look to damages sought and recovered for a trend as to prevailing status.
PPG took no monetary award from its two claims for the sum of $435,870. Zurawin won $424,991. This is $860,861 in his column. But of all the damages Zurawin sought from PPG for its claimed breaches of the Agreement, PPG avoided about $3,540,000. Here again, the accounting shows sufficient distance between the figures for the court to have confidence in its view of the results. Given the test we have adopted, this outcome shows that PPG is the prevailing party on claims covered by the Agreement.
This is the total of the amounts sought in the Amended Counterclaim and the initial Counterclaim for the claims as we counted them above that Zurawin abandoned; PPG won by motion; or the jury found for PPG. Doc. No. 33 at 21 and Doc. No. 9 at 22.
D. Determining Amount of Fees and Costs
PPG has paid a total of $1,057,609 in fees. Wycoff Affidavit, Tab C to PPG's Motion to Recover Attorneys' Fees and Costs, Doc. No. 185, ¶ 5. The company reduced that amount to correspond to the fees generated by hours spent on contract claims; this figure is $879,267 Id. ¶ 6.
PPG's costs were reduced by the same percentage as its fees associated with contract claims. The amount of costs it seeks is $81,175 Id. ¶ 8.
PPG then further discounted these figures by 12% to account for its incomplete level of success. PPG arrived at this particular decision by relying in part on a case that applied the lodestar analysis for determining reasonableness that the company had previously disavowed. Spegon v. Catholic Bishop of Chicago, 175 F.3d 544 (7th Cir. 1999) (fees for Fair Labor Standards Act violation).
We think the better approach was taken by the Seventh Circuit in Medcom. In a case involving a contractual fee-shifting provision, the court stated:
On remand the district court should jettison the analogy to fee-shifting statutes and ask the questions posed by the parties' agreement: did the legal expenses result from Baxter's breach [in our case, from "legal proceedings"] and, if so, were the fees reasonable (that is, were they fees that commercial parties would have incurred and paid knowing that they had to cover the outlay themselves)?200 F.3d at 521. In determining whether the fees at issue were reasonable as required by the contract, the court in Medcom stated that reasonableness must be assessed according to the market, and that "[i]f the bills were paid, this strongly implies that they meet market standards," id. at 520, especially if they were paid at a time when recovery was uncertain, id. at 521. The court added that another factor demonstrating reasonableness was the $200,000 difference between the smaller fees of the prevailing party and its opponent's fees. We have a much greater disparity in relative fee claims: PPG paid $1,057,609, while Zurawin incurred $1,610,525. These figures would be reduced for hours devoted to non-Agreement issues. The parties have done these calculations, with PPG claiming $879,267, and Zurawin requesting $1,336,735, see Springer Declaration, in Doc. No. 183, ¶ 17.
We adopt this approach, and find that PPG is entitled to its fees and costs attributable to litigation arising out of disputes over the terms and conditions of the Agreement. These figures are $879,267 and $81,175 respectively, Wycoff Affidavit, Doc. No. 185, Tab C at ¶¶ 6 and 8. Judgment will therefore be entered in favor of PPG on the issue of contractual attorneys' fee and cost liability in the amount of $960,442.
We think this method is correct for four reasons. First, it is more consistent with the contract approach to fee liability, as opposed to the civil rights approach. The contract approach means the court considers the commercial context of the parties in interpreting and enforcing the terms of their agreement.
Second, Zurawin's objections to the reasonableness of PPG's fee request are based on a lodestar analysis, which we reject. Otherwise, he "does not significantly quarrel with" the reasonableness of the number of hours or hourly rates of PPG's lawyers. Zurawin's Memorandum In Opposition to PPG's Motion for Attorneys' Fees, Doc. No. 187, at 10 and 12.
Third, this approach realistically simplifies the fee award process. We have criticized appellate decisions for fostering the illusion that civil rights fee disputes are "collateral to the underlying controversy" and should not be made into "a major controversy." Public Interest Group of NJ, Inc. v. Windall, 51 F.3d 1179, 1190 (3d Cir. 1995). Our criticism can be summed up as follows: the amount of money typically at stake, the number and complexity of issues, and the extreme level of appellate scrutiny all make it abundantly clear that fee litigation most certainly is a major controversy. See Williams v. City of Pittsburgh, Civil Action No. 96-560, May 15, 2000 Opinion at 8 n. 2., on appeal, No. 00-1869. This court's position on the true state of how fee litigation is, and should be, handled is no better phrased than by Judge Aldisert in his concurring and dissenting opinion inWashington v. Philadelphia County Court of Common Pleas, 89 F.3d 1031, 1044 (3d Cir. 1996). If there is genuine interest in manageably deciding fee issues, which are among the most difficult, time-consuming, and vigorously contested on our docket, contractual fee-shifting cases, though admittedly few in number, and the Medcom analysis offer a principled path to this objective.
Fourth, this approach makes contractual fee litigation more predictable and uniform for individuals and companies who do business here. It is not in Pennsylvania's interest to permit confusing or ambiguous rules spawning expensive litigation over contractual fee liability. If parties knew that a court would make a general accounting of claims and damages to determine the prevailing party, lawyers would be better prepared to draft appropriate language, handle fee litigation, and predict outcomes, and clients would be better able to plan their business affairs and litigation strategy. Litigants' abilities to predict fee awards by applying the standard set of criteria we adopt would also assist in properly evaluating settlement proposals.
E. Conclusion
The court has not found much useful precedent in attempting to predict how the Pennsylvania Supreme Court would rule on divided outcomes in contractual fee-shifting cases. Courts always seek to interpret contracts in the world the parties inhabit, however. We think this points to an interpretation of the term "prevailing party" in litigation in a manner similar to how commercial enterprises determine who prevailed in other aspects of their business — by comparing basic measurements of performance. The basic measures of performance we use are the claims made and the damages sought. In the absence of a contract reference to a civil rights standard, or some particular measure of success, which commercial parties are always free to use, we believe this method provides the fairness and uniformity that Pennsylvania would want to extend to persons who make these sorts of arrangements.
F. Prejudgment Interest
Zurawin seeks prejudgment interest under Pennsylvania law on the contract claims the jury found in its favor. The right to interest and the overwhelming amount of interest due is not disputed; PPG makes minor objections to the starting date for the accrual of interest. We find that Zurawin's calculation of the starting dates is supportable and will add prejudgment interest to the judgment accordingly.
ORDER
In accordance with the foregoing:
1. The Zurawin parties' Motion for Attorneys' Fees and Costs, Doc. No. 176, is DENIED.
2. The PPG parties' Motion for Attorneys' Fees and Costs, Doc. No. 185, is GRANTED. Judgment will be entered in favor of PPG in the amount of $960,442 on these issues.
3. Zurawin's Motion for an Award of Prejudgment Interest, Doc. No. 173, is GRANTED. Prejudgment interest will be added to Zurawin's recovery at the rate of $58.42 per day on the Termination Claim from March 9, 1992 to the date of judgment; at the rate of $11.44 per day on the UCI Commission Claim from March 9, 1992 to the date of judgment; and at the rate of $41.10 per day on the Small Cans Claim from January 1, 1992 to the date of judgment, all such amounts to be calculated in the judgment.