Promedev LLC v. Wilson

District Court, W.D. Washington·Decided June 18, 2024·No. 2:22-cv-01063·Unknown

Opinion

1 2

3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 8 AT SEATTLE

9 10 PROMEDEV, LLC, CASE NO. C22-1063JLR 11 Plaintiff, ORDER v. 12 ROBY WILSON, et al., 13 Defendants. 14

15 I. INTRODUCTION 16 Before the court are competing motions for attorneys’ fees filed by Plaintiff 17 Promedev, LLC (“Promedev”) and Defendants Roby Wilson, MaXXiMedia Advertising 18 Co. (“MaXXiMedia”), and Imagipix Corporation (together, “Defendants”). (Pl. Mot. 19 (Dkt. # 123); Defs. Mot. (Dkt. # 126); see Pl. Reply (Dkt. # 135); Defs. Reply (Dkt. 20 # 136).) Each side opposes the other side’s motion. (See Pl. Resp. (Dkt. # 132); Defs. 21 Resp. (Dkt. # 129).) The court has considered the motions, the parties’ submissions, the 22 1 relevant portions of the record, and the governing law. Being fully advised,1 the court 2 GRANTS in part and DENIES in part Promedev’s motion and DENIES Defendants’

3 motion. 4 II. BACKGROUND 5 The court set forth the factual background of this matter in detail in its April 1, 6 2024 order granting in part and denying in part the parties’ motions for summary 7 judgment. (4/1/24 Order (Dkt. # 93) at 2-7.) The court assumes that the reader is 8 familiar with that order, and thus focuses here on the background relevant to the parties’

9 motions for attorneys’ fees and costs. 10 This action arose from a July 2020 agreement (the “Agreement”) between 11 Promedev and MaXXiMedia under which Promedev agreed to pay MaXXiMedia a 12 monthly commission in exchange for MaXXiMedia’s advertising services. (1/18/24 13 Wilson Decl. (Dkt. # 58) ¶ 8, Ex. A (“Agreement”).) The Agreement provides, in

14 relevant part, for an award of attorneys’ fees and costs to the “prevailing party”: 15 14. Attorneys’ Fees. In the event that the services of an attorney are required or legal action is taken to enforce the terms of this Agreement by 16 either party, or to protect those rights provided by this contract or by law, the prevailing party shall be entitled to an award of actual attorney’s fees, costs, 17 and expenses reasonably expended.

18 (Agreement ¶ 14.) 19 20

21 1 Neither party requests oral argument (see Pl. Mot. at 1; Pl. Resp. at 1; Defs. Mot. at 1; Defs. Resp. at 1) and the court concludes that oral argument would not be helpful to its 22 disposition of these motions, see Local Rules W.D. Wash. LCR 7(b)(4). 1 On July 1, 2022, Promedev notified MaXXiMedia of its intent to terminate the 2 Agreement 60 days later, on August 31, 2022, consistent with paragraph 13 of the

3 Agreement. (See 4/1/24 Order at 4 (discussing the termination of the Agreement).) 4 Promedev included with its notice a proposed termination agreement that would confirm 5 its remaining payment obligations and its right to ownership of “creative product” 6 produced during the term of the Agreement. (See id.) This triggered “a flurry of 7 correspondence from MaXXiMedia,” including a “Notice of Breach of Contract” and 8 demands for additional payment of millions of dollars for “creative product,” “work

9 product,” a “lifetime non-compete and non-disparagement agreement,” and 10 miscellaneous expenses, some of which predated the Agreement. (See id. at 4-6.) 11 Promedev did not pay the additional amounts MaXXiMedia demanded. (See id. at 12 6-7.) It filed this case on July 29, 2022, while the issues of payment and creative product 13 ownership were still unresolved. (See id. at 7; see also Compl. (Dkt. # 1).) Promedev

14 alleged claims against Defendants for breach of contract, breach of the implied covenant 15 of good faith and fair dealing, breach of fiduciary duty, “civil coercion, extortion, and 16 blackmail,” and a declaratory judgment determining: 17 a. Promedev has complied with its obligations under, and is not in breach of, the Agreement. 18 b. Promedev’s obligations as it relates to commissions after August 31, 2022. 19 c. Promedev’s obligations with regard to the Production Expenses not directly related to the production of specific commercials. 20 d. Promedev has no obligation to pay for any Creative Product. e. Promedev is the owner of all of the alleged Creative Product, 21 including all of its commercials and the elements of those commercials, and any copyright registrations filed by [Defendants] 22 are invalid and should be canceled. 1 f. Promedev has not obligation to pay for any Work Product. g. Promedev has no obligation to pay for Non-Compete and/or 2 Non-Disparagement.

3 (See id. ¶¶ 58-88.) By September 2022, Promedev paid MaXXiMedia commissions 4 owed through December 2022 and most of Mr. Wilson’s invoiced expenses. (See 4/1/24 5 Order at 6.) It did not, however, pay the additional sums MaXXiMedia demanded for 6 creative product, work product, or a non-compete/non-disparagement agreement. (See id. 7 at 6-7.) 8 On October 25, 2022, Defendants filed an answer and affirmative defenses, along 9 with counterclaims on behalf of MaXXiMedia for breach of contract, breach of the 10 implied covenant of good faith and fair dealing, copyright infringement, trade secret 11 misappropriation in violation of state and federal law, violation of the Washington 12 Consumer Protection Act (“WCPA”), and “fraudulent inducement and fraudulent 13 misrepresentation.” (Ans. (Dkt. # 18) at 17-27, ¶¶ 22-55.) MaXXiMedia amended its

14 counterclaims on December 23, 2022, in response to Promedev’s first motion to dismiss. 15 (See generally 1st MTD (Dkt. # 23); Am. Counterclaims (Dkt. # 25).) 16 On March 2, 2023, the court granted in part and denied in part Promedev’s 17 renewed motion to dismiss certain of MaXXiMedia’s counterclaims. (3/2/23 Order (Dkt. 18 # 40).) In relevant part, the court dismissed MaXXiMedia’s claims for violation of the

19 WCPA and for fraudulent inducement and fraudulent misrepresentation, and denied 20 Promedev’s motions to dismiss MaXXiMedia’s trade secret misappropriation claims and 21 to strike MaXXiMedia’s request for the remedy of disgorgement of profits. (See id. at 22 22.) MaXXiMedia did not further amend its counterclaims. (See generally Dkt.) 1 Promedev filed an amended complaint on November 8, 2023. (Am. Compl. (Dkt. 2 # 54); see 11/3/23 Order (Dkt. # 53) (granting Promedev’s unopposed motion for leave to

3 amend).) Promedev voluntarily dropped its breach of fiduciary duty claim and removed 4 Mr. Wilson’s name from the heading of its breach of contract claim. (See Am. Compl. 5 ¶¶ 64-85.) It also made minor revisions to its declaratory judgment claim. (Compare id. 6 ¶ 84, with Compl. ¶ 87.) 7 On January 18, 2024, Defendants moved for summary judgment on all of 8 Promedev’s claims. (Defs. MSJ (Dkt. # 56).) Promedev filed its own motion for

9 summary judgment on all of MaXXiMedia’s counterclaims on February 8, 2024. (Pl. 10 MSJ (Dkt. # 72).) Neither party moved for summary judgment on its own claims. (See 11 generally id.; Defs. MSJ.) 12 On April 1, 2024, the court granted in part and denied in part each of the parties’ 13 motions. (See generally 4/1/24 Order.) The court granted in part Promedev’s motion for

14 summary judgment on MaXXiMedia’s breach of contract counterclaim and granted in 15 full Promedev’s motion for summary judgment on MaXXiMedia’s counterclaims for 16 breach of the implied covenant of good faith and fair dealing, trade secret 17 misappropriation, and copyright infringement. (See id. at 35.) As a result, only 18 MaXXiMedia’s counterclaim that Promedev breached the Agreement by disclosing

19 billing rates to third parties remained at play. (See id.) The court granted Defendants’ 20 motion for summary judgment on Promedev’s “civil coercion, extortion, or blackmail” 21 claim and denied their motion for summary judgment on Promedev’s claims for breach of 22 contract and of the implied covenant of good faith and fair dealing.

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