Joint Stock Company Channel One Russia Worldwide v. Infomir LLC

District Court, S.D. New York·Decided May 15, 2020·No. 1:16-cv-01318·Unknown

Opinion

USDC SDNY DOCUMENT ELECTRONICALLY FILED UNITED STATES DISTRICT COURT DOC #: SOUTHERN DISTRICT OF NEW YORK DATE FILED: 5/15/20 JOINT STOCK COMPANY CHANNEL ONE RUSSIA WORLDWIDE, et al., 16-CV-1318 (GBD) (BCM) Plaintiffs, . ORDER -against- INFOMIR LLC, et al., Defendants.

BARBARA MOSES, United States Magistrate Judge. For the reasons stated below, the Court awards defendant Infomir LLC (Infomir) a total of $254,116.45 in attorneys’ fees, expert fees, and expenses, as sanctions pursuant to Fed. R. Civ. P. 37(b), assessed jointly and severally against plaintiffs Joint Stock Company "Channel One Russia Worldwide," Closed Joint Stock Company "CTC Network,” Closed Joint Stock Company "TV DARIAL," Closed Joint Stock Company "New Channel," Limited Liability Company "Rain TV- Channel,” and Limited Liability Company "Global Entertainment TV" (f/k/a Limited Liability Company "Comedy TV") and their counsel, Dunnington Bartholow & Miller LLP (Dunnington). Background On November 5, 2018, Infomir filed a motion (Dkt. No. 692) seeking discovery sanctions pursuant to Fed. R. Civ. P. 37(b) as a remedy for plaintiffs’ violations of this Court's discovery orders, including orders dated April 25, 2018 (the 4/25/18 Order) (Dkt. No. 569) and July 3, 2018 (the 7/3/18 Order) (Dkt. No. 617). Infomir's motion was the culmination of its vigorous efforts, beginning in 2017, to seek the data and documents underlying the June 24, 2016 affidavit of Christopher Vidulich (Vidulich Affidavit) (Dkt. No. 80) and evidencing the "Wireshark" network protocol analyzer investigation (Wireshark Investigation) that Vidulich performed in May 2016

and described in his affidavit.1 Relying on the Wireshark Investigation and its results, Vidulich concluded – erroneously, as it turned out – that Infomir "streamed" unlicensed content, including plaintiffs' copyrighted broadcasting, from "freetvstat.infomir.com.ua," with an internet protocol address "located in the United States," to consumers in New York and elsewhere. Vidulich Aff.

¶¶ 19-25, 30. Plaintiffs attached the Vidulich Affidavit to their pleadings, see First Am. Compl. (Dkt. No. 211) Ex. 15, and relied on it to support two (later withdrawn) summary judgment motions against Infomir. (Dkt. No. 269 at 14; Dkt. No. 552 at 6.) However, they did not produce any electronically stored information (ESI) underlying the Wireshark Investigation until 2018, and did not produce the native-format electronic "packet capture" file (PCAP File) that constituted the "only complete record" of that investigation until October 12, 2018, after representing repeatedly that it did not exist – and deleting it from Vidulich's laptop shortly before they turned the laptop over for analysis by Informir's digital forensics experts at Stroz Friedberg, LLC (Stroz Friedberg). See Joint Stock Co. Channel One Russia Worldwide, 2019 WL 4727537, at *1-2, *16. Once produced, the PCAP File established (and plaintiffs ultimately conceded) that

"'freetvstat.infomir.com.ua' was not the source of any of the video content that Vidulich viewed" during the Wireshark Investigation. Id. at *16 (emphasis added). On September 26, 2019, after receiving extensive briefing and conducting an evidentiary hearing at which both Infomir and plaintiffs presented expert testimony, the Court granted Infomir's motion, concluding that plaintiffs violated the 4/25/18 Order and the 7/3/18 Order directing them to produce the ESI underlying the Wireshark Investigation, and that they and their

1 The Vidulich Affidavit and the Wireshark Investigation, as well as the factual background and procedural history of the sanctions motion, are described in more detail in my Opinion and Order granting the sanctions motion. See Joint Stock Co. Channel One Russia Worldwide v. Infomir LLC, 2019 WL 4727537, at *2-17 (S.D.N.Y. Sept. 26, 2019) (hereafter the Sanctions Order), objections overruled, 2020 WL 1479018 (S.D.N.Y. Mar. 26, 2020). counsel made a series of false statements (many under oath), in bad faith, "about the Wireshark Investigation, the ESI evidencing that investigation, and their discovery compliance." Joint Stock Co. Channel One Russia Worldwide v. Infomir LLC, 2019 WL 4727537, at *21-28. As a sanction, the Court precluded plaintiffs "from introducing or relying on the June 24, 2016 Vidulich

Affidavit, any other report of, testimony about, or opinions based on the May 2016 Wireshark Investigation, and any data or information captured during that Wireshark Investigation . . . except in response to any use of the same evidence by Infomir." Id. at *34. In addition, the Court concluded, in accordance with Fed. R. Civ. P. 37(b)(2)(C), that plaintiffs "and their counsel" must pay Infomir's "attorney's fees, expert fees, and other costs reasonably incurred in obtaining and enforcing the 4/25/18 Order and the 7/3/18 Order," including fees and costs incurred in connection with the deposition of Christopher Vidulich on August 29, 2018, "as well as the expenses reasonably incurred in litigating the instant sanctions motion." Id. at *29. On October 11, 2019, Infomir filed the declaration of its lead attorney Stewart M. Leviss (Leviss Decl.) (Dkt. No. 783), seeking an award of (1) $220,446 in attorneys' fees, based on

458.3 hours expended by Leviss and his associate Evan Silagi in 2018, and 156.4 hours expended by them in 2019, and (2) $87,889.99 in other expenses, consisting of $85,889.36 in expert and consultant costs and $2,000.63 in court reporting and similar costs. Leviss Decl. ¶¶ 24, 38-40; see also id. Ex. A (partially-redacted time sheets and invoices from Infomir's counsel); id. Exs. B & C (partially-redacted invoices from Stroz Friedberg).2 On October 25, 2019, plaintiffs filed an opposition memorandum (Pl. Opp.) (Dkt. No. 789), together with the declaration of their lead attorney

2 The Leviss Declaration seeks $97,889.99 in expenses, which the Court understands to be a typographical error. See Leviss Decl. ¶ 40 ("The expenses incurred and for which reimbursement is sought, including expert and consultant costs of $85,889.36 and the additional disbursements of $2,000.63 described at paragraph 24 herein, total $97,889.99."). Raymond J. Dowd (Dowd Decl.) (Dkt. No. 788). Plaintiffs argue that the Court should deny Infomir's request entirely or reduce the amount of fees and expenses significantly, arguing principally that Infomir's redactions prohibit plaintiffs from determining the reasonableness of Infomir's fee request, that some of Infomir's expenses "clearly exceed the scope of the Sanctions

Order," and that "the materials attached to the [Leviss] Declaration are deficient to substantiate Infomir's total request for reimbursement." Pl. Opp. at 1-4.3 Analysis As noted above, this Court has found that Infomir is entitled to an award of fees and expenses against plaintiffs and their counsel pursuant to Fed. R. Civ. P. 37(b)(2)(C), which provides for reimbursement of "reasonable expenses, including attorneys' fees, caused by" an opposing party's violations of court orders. Consequently, the Court must now determine whether defendants' requested award is reasonable and whether the expenses for which reimbursement is sought were caused by plaintiffs' violations. "In determining the amount of reasonable attorneys' fees, '[t]he most useful starting point

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