USDC S.D. California, January 20, 2009
Plaintiff Brighton Collectibles, Inc. (“Brighton”), a designer, manufacturer and retailer of women’s fashion accessories, brought suit against retailer Coldwater Creek, Inc. (“Coldwater”) for copyright and trade dress infringement of Brighton’s “Carolina” and “Brighton Scroll” designs, , false designation of origin, common law unfair competition, and statutory unfair competition. The court granted Coldwater’s motion for summary judgment with respect to infringement of Brighton’s “Brighton Scroll” copyright. Six months later, a jury returned a special verdict in Brighton’s favor, “finding that Coldwater willfully committed trade dress infringement, false designation of origin, and copyright infringement of the ‘Carolina’ copyright and engaged in unfair competition with malice, fraud, or oppression.” The jury awarded Brighton damages totaling $7,392,000, including actual damages and wrongful profits.
Discussing the award of attorneys’ fees under the Lanham Act, the court applied the standard that such an award may be made to the prevailing party in “exceptional cases,” meaning cases in which the “infringement is willful, deliberate, knowing or malicious.” First, the court found that Brighton was the prevailing party under the Lanham Act, based on the jury verdict that Coldwater “willfully committed trade dress infringement and false designation of origin.” Next, the court cited the jury’s finding of willfulness and “substantial evidence of Coldwater’s intentional infringing conduct” as the basis for finding the case exceptional. This evidence included emails between Coldwater employees and designers discussing ways to make Coldwater’s products “more ‘Brightony.’”
Both parties moved for attorneys’ fees under the Copyright Act, each claiming to be the “prevailing party.” Brighton claimed prevailing party status based on the jury verdict in its favor on the “Carolina” claim, and Coldwater argued that it was the prevailing party because of the summary judgment against Brighton on the “Brighton Scroll” claim. The court granted Brighton’s motion and denied Coldwater’s motion, finding that Brighton was the overall prevailing party in the litigation. The court reasoned that Brighton had obtained a high degree of success in its infringement claim and that, because the jury found Coldwater’s infringement of the “Carolina” design willful, a fee award in the case would further the goal of the Copyright Act of “‘encouraging private enforcement and deterring infringements.’” See Smith v. Jackson, 84 F.3d 1213, 1221 (9th Cir. 1996). In spite of the dismissal of the “Brighton Scroll” claims, the court declined to grant those attorneys’ fees to Coldwater and deduct the amount from the attorneys’ fees granted to Brighton. Instead, the court solely granted attorneys’ fees to Brighton, because “Brighton’s copyright claims arose from a common core of facts, the evidence on infringement overlapped, and the claims were based on the same governing law.” See Creative Computing v. Getloaded.com, LLC, 386 F.3d 930, 937 (9th Cir. 2004).
The court calculated an attorneys’ fee “lodestar” of $1,235,404, which it granted without adjustment. Finding Brighton adequately compensated by the jury’s award, the court denied Brighton’s motion for prejudgment interest on that award. The court also declined to award enhanced damages to Brighton under the Lanham Act because the court found that Brighton was reasonably compensated by the jury award and the award of attorneys’ fees. The jury had specifically rejected punitive damages against Coldwater, and the court stated that an enhancement of damages “may constitute an impermissible penalty.”