Capitol Records, LLC v. Redigi Inc.

District Court, S.D. New York·Decided August 12, 2022·No. 1:12-cv-00095·Unknown

Opinion

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

CAPITOL RECORDS, LLC, CAPITOL No. 1:12-cv-95 (RJS) CHRISTIAN MUSIC GROUP, INC. and ORDER VIRGIN RECORDS IR HOLDINGS, INC.,

Plaintiffs, -v-

REDIGI INC., JOHN OSSENMACHER and LARRY RUDOLPH a/k/a LAWRENCE S. ROGEL,

Defendants. RICHARD J. SULLIVAN, Circuit Judge: Before the Court is Plaintiffs’ request for $514,421.53 in attorneys’ fees pursuant to the Court’s prior Order granting in part and denying in part Plaintiffs’ request for attorneys’ fees under 17 U.S.C. § 505. (Doc. Nos. 319, 329). For the reasons set forth below, the Court awards $514,355.38 in fees. BACKGROUND Capitol Records, LLC (“Capitol”), Capitol Christian Music Group, Inc., and Virgin Records IR Holdings, Inc. (collectively, “Plaintiffs”) sued ReDigi Inc. (“ReDigi”) and its “founding owners” Larry Rudolph (also known as “Lawrence S. Rogel”) and John Ossenmacher (collectively, “Defendants”) for copyright infringement. See Capitol Recs., LLC v. ReDigi Inc., 934 F. Supp. 2d 640, 645 (S.D.N.Y. 2013). Plaintiffs alleged that the Defendants infringed on Plaintiffs’ reproduction and distribution rights for numerous digital music files. See id. at 646–47. In 2013 and 2016, the Court granted summary judgment motions in favor of Plaintiffs. See id. at 645. The Second Circuit affirmed these decisions on December 12, 2018. See Capitol Recs., LLC v. ReDigi Inc., 910 F.3d 649, 664 (2d Cir. 2018). The Court presumes the parties’ familiarity with the other relevant facts and procedural history of the case, which are set out more fully in the Court’s March 30, 2013 Opinion, see ReDigi, 934 F. Supp. 2d at 644–47, as well as its April 7, 2022 Order granting in part Plaintiffs’ request for fees (the “Fees Order”). (Doc. No. 328). The Fees Order awarded Plaintiffs attorneys’ fees for “certain proceedings before this Court in connection with the parties’ cross-motions for summary judgment, for fees incurred after

the Court’s March 30, 2013 summary judgment opinion, and for fifteen percent of Plaintiffs’ fees incurred on appeal.” (Doc. No. 328 at 23.) As directed by the Court, Plaintiffs submitted an accounting of those fees on May 6, 2022. (Doc. No. 329.) Defendants, however, declined to submit a response, which was due on June 6, 2022. In an action brought under 17 U.S.C. § 101, a district court may “award a reasonable attorney’s fee to the prevailing party.” 17 U.S.C. § 505. There is “no precise rule or formula” for determining the appropriateness or magnitude of attorneys’ fees under section 505. Fogerty v. Fantasy, Inc., 510 U.S. 517, 534 (1994) (internal quotation marks omitted). Instead, courts must exercise their “equitable discretion” when awarding these fees, id., which they typically do

pursuant to a four-factor test. (Doc. No. 328 at 6–7 (citing Fogerty, 510 U.S. at 534 n.19).) After concluding a party is entitled to attorneys’ fees, a court determines the “presumptively reasonable fee” to which that party is entitled by multiplying a reasonable hourly rate for each attorney by the reasonable number of hours he or she expended on the case. Arbor Hill Concerned Citizens Neighborhood Ass’n v. County of Albany, 522 F.3d 182, 189–90 (2d Cir. 2008). This procedure is referred to as the “lodestar method.” McDonald v. Pension Plan of the NYSA-ILA Pension Trust Fund, 450 F.3d 91, 96 (2d Cir. 2006). Under the lodestar method, a court must first set a “reasonable hourly rate” for each attorney and staff member, keeping in mind all case-specific variables, such as each member’s years of practice, expertise in the areas of law at issue in the case, and prior work experience. Merck Eprova AG v. Brookstone Pharms., LLC, No. 09-cv-9684 (RJS), 2013 WL 3146768, at *1 (S.D.N.Y. June 10, 2013). Second, the court must determine the number of hours each attorney reasonably expended. Id. Third, it must multiply the reasonable hourly rate by the number of hours reasonably expended to determine the “presumptively reasonable fee.” Id. At its core, this method “boils down to [asking] what a

reasonable, paying client would be willing to pay, given that such a party wishes to spend the minimum necessary to litigate the case effectively.” Simmons v. N.Y.C. Transit Auth., 575 F.3d 170, 174 (2d Cir. 2009) (internal quotation marks omitted). DISCUSSION Having concluded that Plaintiffs are entitled to attorneys’ fees for parts of the district court litigation and the appeal, the Court must now determine whether the specific recovery sought by Plaintiffs is reasonable. (Doc. No. 328.) Based on the Fees Order, Plaintiffs identify $593,110.33 worth of fees incurred in district court litigation that are eligible for reimbursement under the Fees Order (Doc. No. 329 at 10), and they request reimbursement for $500,000 of this work – the

maximum amount that Plaintiffs may seek under the parties’ joint stipulation (Doc. No. 178 at ¶ 6). Because the stipulated cap covers only fees incurred in the district court, Plaintiffs seek an additional $14,421.53 based on the Court’s decision to award them fifteen percent of the cost of their appeal. (Doc. No. 329 at 10.) As an initial matter, the Court notes that the Defendants did not respond to Plaintiffs’ records of the fees they incurred, despite the Court’s having given them the opportunity to respond by June 6, 2022. As a result, “any complaints or arguments they may have had on the subject are therefore abandoned.” EMA Fin., LLC v. 5Barz Int’l, Inc., No. 18-cv-4995 (VEC), 2019 WL 8503357, at *11 (S.D.N.Y. Sept. 18, 2019) (citing Jackson v. Fed. Exp., 766 F.3d 189, 198 (2d Cir. 2014)); see also Legacy Agency, Inc. v. Scoffield, No. 20-cv-5771 (JGK), 2021 WL 5332295, at *3 (S.D.N.Y. Nov. 15, 2021) (rejecting a respondent’s argument the other party should not receive attorneys’ fees when that argument is “untimely”). Accordingly, the Court treats Plaintiffs’ motion as unopposed and grants their requests except when they conflict with the law or practice of courts in this Circuit.

Hourly Rates To determine if a proposed hourly rate is reasonable, “courts compare it to prevailing market rates ‘for similar services by lawyers of reasonably comparable skill, experience, and reputation.’” Whitehead v. Mix Unit, LLC, No. 17-cv-9476 (VSB) (JLC), 2019 WL 384446, at *5 (S.D.N.Y. Jan. 31, 2019) (quoting Gierlinger v. Gleason, 160 F.3d 858, 882 (2d Cir. 1998)).

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Capitol Records, LLC v. Redigi Inc., (S.D.N.Y. 2022).

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