Killough v. Monkress

CourtDistrict Court, N.D. Alabama
DecidedMay 17, 2022
Docket5:17-cv-00247
StatusUnknown

This text of Killough v. Monkress (Killough v. Monkress) is published on Counsel Stack Legal Research, covering District Court, N.D. Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Killough v. Monkress, (N.D. Ala. 2022).

Opinion

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ALABAMA NORTHEASTERN DIVISION

DOUG KILLOUGH and ) TECHNICAL CONSULTING ) SOLUTIONS, INC., ) ) Civil Action Number Plaintiffs, ) 5:17-CV-00247-AKK ) v. ) ) ALL POINTS LOGISTICS, LLC, )

) Defendant. )

MEMORANDUM OPINION AND ORDER

At the conclusion of a two-week jury trial, the parties submitted a veritable avalanche of filings. After all, the jury could not possibly have reached the right result, at least according to the defendant, All Points Logistics, LLC. Instead, says APL, the verdict against it was the result of multiple errors, including by the court, by plaintiffs’ counsel, and by the jury. The court continues to review these motions and notices and, so far, has rejected them. In particular, the court has denied APL’s substantive post-trial motions, doc. 247, its request for a permanent injunction, doc. 249, and its attempt to schedule an unnecessary trial on its contractual attorneys’ fees claim, doc. 250. Presently before the court is APL’s motion for attorneys’ fees on its trade-secrets counterclaims. Doc. 211. APL has also filed an accompanying bill of costs and a supporting brief. Docs. 216; 217. Doug Killough and Technical Consulting Solutions, Inc. oppose the imposition of fees and costs against them and maintain that APL “clearly lost and

received an unfavorable judgment” and “has not met its statutory burden of proving willful and malicious appropriation” necessary to shift fees under the federal and Alabama trade-secrets statutes. See docs. 219; 231. Killough and TCS also move

to strike APL’s bill of costs and its reply brief, docs. 231; 238, and they supply their own bill of costs and a supporting brief, docs. 213; 214.1 For the reasons that follow, although the court will not strike the filings, the court will deny APL its fees and costs and impose Killough’s and TCS’s costs against it.2

I. Under Federal Rule of Civil Procedure 54(d), a litigant may recover attorney’s fees and costs subject to certain parameters. With respect to costs, “[u]nless a federal

statute, these [federal] rules, or a court order provides otherwise, costs—other than attorney’s fees—should be allowed to the prevailing party.” FED. R. CIV. P. 54(d)(1). “A claim for attorney’s fees and related nontaxable expenses,” on the other hand, “must be made by motion unless the substantive law requires those fees to be proved

1 APL also objects to the taxation of costs against it and asks that, should the court impose these costs, the court stay taxation pending the resolution of any post-trial motions and appeals. See doc. 232 at 10. The court has since denied APL’s substantive post-trial motions. See doc. 247. The court will consider staying the judgment in a separate order addressing APL’s independent motion to stay, doc. 228.

2 The court will also deny Killough’s and TCS’s alternative request to file a sur-reply. See doc. 238. The court can parse and reject APL’s arguments without yet another filing. at trial as an element of damages.” Id. 54(d)(2). When evaluating claims for fees, “[t]he court may decide issues of liability for fees before receiving submissions on

the value of services.” Id. 54(d)(2)(C). Relevant here, under the federal Defend Trade Secrets Act, the court may award “reasonable attorney’s fees to the prevailing party” if

a claim of the misappropriation is made in bad faith, which may be established by circumstantial evidence, a motion to terminate an injunction is made or opposed in bad faith, or the trade secret was willfully and maliciously misappropriated. 18 U.S.C. § 1836(b)(3)(D). Thus, “[t]o be eligible, the party seeking fees (1) must prevail and (2) it must do so in one of the three listed scenarios that also require a showing of bad faith or malice.” Dunster Live, LLC v. LoneStar Logos Mgmt. Co., 908 F.3d 948, 952 (5th Cir. 2018) (citing 18 U.S.C. § 1836(b)(3)(D)). Similarly, under the Alabama Trade Secrets Act, “the prevailing party” may recover “reasonable attorney’s fees” if (1) “[a] claim of actual or threatened misappropriation is made or resisted in bad faith,” (2) “[a] motion to terminate an

injunction is made or resisted in bad faith,” or (3) “[w]illful and malicious misappropriation exists.” ALA. CODE § 8-27-4(a)(2). II.

In this case, the jury found that (1) APL breached an agreement to pay Killough profits in 2015, resulting in damages of $293,823.67; (2) APL breached an agreement to novate contracts to TCS, resulting in damages of $1,667,197.24; (3) Killough violated certain provisions of his APL employment agreement, but this caused no damage to APL; and (4) Killough violated the DTSA and the ATSA, but

this caused no damage to APL. Doc. 202. The court entered judgment that tracked this verdict and awarded Killough and TCS $1,961,020.91.3 Doc. 208. The court also taxed costs against APL. Id.

APL now claims entitlement to attorneys’ fees on its trade-secrets counterclaims, doc. 211, and both parties seek their respective costs, docs. 213; 216. III. APL cannot recover fees or costs under the DTSA or the ATSA because APL

neither prevailed under these laws nor established that its trade secrets “[were] willfully and maliciously misappropriated.” See FED. R. CIV. P. 54(d); 18 U.S.C. § 1836(b)(3)(D); ALA. CODE § 8-27-4(a)(2).4

3 In the instant filings and elsewhere, APL takes issue with the judgment in part because the jury did find that Killough violated federal and state trade-secrets law—just not that these violations caused any injuries to APL. It is true that resulting harm is not an element of a misappropriation claim under the DTSA or the ATSA. See Rotor Blade, LLC v. Signature Util. Servs., LLC, 545 F. Supp. 3d 1202, 1221 (N.D. Ala. 2021); Trinity Graphic, USA, Inc. v. Tervis Tumbler Co., 320 F. Supp. 3d 1285, 1293 (M.D. Fla. 2018). The court accordingly amended the judgment to reflect this correction, although, the court notes, APL did not seek this specific modification. See doc. 248. However, these facts do not change the analysis here because, as explained, APL did not “prevail” in the relevant sense.

4 The court employs the same reasoning for the DTSA and ATSA claims. To be sure, in some situations, state law may award fees more generously than federal law. See, e.g., Dunster Live, LLC, 908 F.3d at 952 (recognizing “general state attorneys’ fees law that more liberally awards fees”). But here, the relevant components of the DTSA and ATSA utilize identical or near- identical language. Compare 18 U.S.C. § 1836(b)(3)(D) with ALA. CODE § 8-27-4(a)(2). See also Parker v. Petrovics, No. 2:19-CV-00699-RDP, 2020 WL 3972761, at *4 (N.D. Ala. July 14, 2020) (“The language in the ATSA is nearly identical to that in the DTSA.”). Additionally, the ATSA A. At a minimum, the DTSA and the ATSA clearly require the attorney-fee

claimant to be “the prevailing party.” See 18 U.S.C. § 1836(b)(3)(D); ALA. CODE § 8-27-4(a)(2).

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Killough v. Monkress, Counsel Stack Legal Research, https://law.counselstack.com/opinion/killough-v-monkress-alnd-2022.