Bristol Technology, Inc. v. Microsoft Corp., CIV.A. 3:98-CV-1657(JCH).

• Decision Date: 03 November 2000
• Docket Number: No. CIV.A. 3:98-CV-1657(JCH).,CIV.A. 3:98-CV-1657(JCH).
• Citation: 127 F.Supp.2d 64
• Parties: BRISTOL TECHNOLOGY, INC., Plaintiff, v. MICROSOFT CORPORATION, Defendant.
• Court: U.S. District Court — District of Connecticut

127 F.Supp.2d 64

BRISTOL TECHNOLOGY, INC., Plaintiff, v. MICROSOFT CORPORATION, Defendant.

No. CIV.A. 3:98-CV-1657(JCH).

United States District Court, D. Connecticut.

November 3, 2000.

Patrick Lynch, O'Melveny & Myers, Los Angeles, CA, John L. Altieri, Jr., Annette Poblete, Achilles M. Perry, O'Melveny & Myers, New York, NY, Mladen D. Kresic, Kresic & Corleto, Ridgefield, Ct, Anthony L. Clapes, Technology Law Network, Honolulu, HI, for Bristol Tech. Inc.

David B. Tulchin, Michael T. Tomaino, Jr., Marc De Leeuw, Elizabeth P. Martin, Brian T. Frawley, John J. Sullivan, Sullivan & Cromwell, New York, NY, James Sicilian, Day, Berry & Howard, Hartford, CT, Steven J. Aeschbacher, Microsoft Corp., Redmond, WA, Steven W. Thomas, Sullivan & Cromwell, Los Angeles, CA, for Microsoft Corp.

Rachel Olivia Davis, Steven Mark Rutstein, Attorney General's Office, Hartford, CT, Mark F. Kohler, Attorney General's Office, Hartford, CT, for State of Conn.

RULING ON MOTION FOR ATTORNEYS' FEES AND COSTS [DKT. NO. 442]

HALL, District Judge.

I. BACKGROUND

This action was commenced in August 1998 by Bristol Technology, Inc. ("Bristol"), a Connecticut corporation primarily owned by the Blackwell family. In its fourteen-count Complaint, Bristol alleged various theories of violations by Microsoft Corp. ("Microsoft") of the federal and state antitrust laws and of the Connecticut Unfair Trade Practices Act ("CUTPA"). At the time it filed its complaint, Bristol sought a preliminary injunction and expedited discovery. The court held a hearing on the preliminary injunction motion and denied it. However, based upon the record in that hearing and its findings, the court scheduled the trial for June 1, 1999.

On January 15, 1999, Microsoft filed its answer and counterclaims [Dkt. No. 110]. Microsoft claimed breach of contract (Count 1), copyright infringement (Count 2), and misappropriation of trade secrets (Count 3). Microsoft filed a motion to dismiss, or in the alternative for summary judgment on, the antitrust claims, and Bristol filed a Motion for Partial Summary Judgment on its CUTPA claims. See Dkt. Nos. 46 & 165. These motions were denied by the court. See Dkt. Nos. 95 & 308.

The parties engaged in intensive and contested discovery of each other and third parties both before the preliminary injunction hearing and after the court's Ruling on the preliminary injunction. There were numerous discovery motions and pretrial conferences and motions. Microsoft also filed a Motion for Summary Judgment on Counts Two and Three of its counterclaims,¹ as did Bristol, and Microsoft filed a Motion for Summary Judgment on Bristol's antitrust claims. See Dkt. Nos. 160, 169 & 170. The court also ordered the trial of the counterclaims severed from the trial of Bristol's claims.²

Despite motions by Microsoft to continue the trial date [Dkt. Nos. 97 & 146], jury selection was held on May 20, 1999, and evidence commenced on June 3, 1999. The jury returned its verdict on July 16, 1999. The jury found that Bristol had failed to prove its relevant market on each of its antitrust claims. It also did not find that Bristol had proven Microsoft committed an unfair act or practice under CUTPA ("unfair CUTPA"). The jury did find that Microsoft had engaged in a deceptive act or practice which had caused Bristol to suffer an ascertainable loss. The jury awarded Bristol nominal damages of $1.00. See Dkt. No. 420.

Post-trial, Bristol filed motions for a permanent injunction [Dkt. No. 431] and punitive damages [Dkt. No. 433], both of which were granted by this court. See Bristol Tech., Inc. v. Microsoft Corp., 114 F.Supp.2d 59 (D.Conn. Aug.31, 2000). Bristol also filed a Motion for Award of Attorneys' Fees and Costs [Dkt. No. 442]. For the reasons set forth herein, the court grants that motion in part and denies it in part.

II. ATTORNEYS' FEES

A. Legal Standards

"In diversity cases, attorney's fees are considered substantive and are controlled by state law." United States v. One Parcel of Property Located at 414 Kings Highway, No. 5:91-CV-158, 1999 WL 301704, at *4 (D.Conn. May 11, 1999) (citations omitted); see also Kaplan v. Rand, 192 F.3d 60, 70 (2d Cir.1999). CUTPA expressly provides that "the court may award, to the plaintiff, in addition to the relief provided in this section, costs and reasonable attorneys' fees based on the work reasonably performed by an attorney and not on the amount of recovery." Conn. Gen.Stat. § 42-110g(d); see also id. § 42-110g(g) ("In any action brought by a person under this section there shall be a right to a jury trial except with respect to the award of punitive damages under subsection (a) of this section or the award of costs, reasonable attorneys' fees and injunctive or other equitable relief under subsection (d) of this section."). Thus, CUTPA expressly requires that such an award be made by the court, be made to "the plaintiff," and be made in addition to other relief provided by CUTPA. Id. § 42-110g(d). "The ability to recover both attorneys' fees ... and punitive damages ... enhances the private CUTPA remedy and serves to encourage private CUTPA litigation." Hinchliffe v. Am. Motors Corp., 184 Conn. 607, 617, 440 A.2d 810 (1981) (citations and internal punctuation omitted); see also Gill v. Petrazzuoli Bros., Inc., 10 Conn.App. 22, 33, 521 A.2d 212 (1987).

It is also well-established that the award is in the discretion of the trial court. "The statute contains no standard by which a court is to award attorney's fees, thus leaving it to the sole discretion of the trial court to determine if attorney's fees should be awarded and the amount of such an award." Staehle v. Michael's Garage, Inc., 35 Conn.App. 455, 461, 646 A.2d 888 (1994). "`Awarding ... attorney's fees under CUTPA is discretionary; ... and the exercise of such discretion will not ordinarily be interfered with on appeal unless the abuse is manifest or injustice appears to have been done.'" Id. (quoting Gargano v. Heyman, 203 Conn. 616, 622, 525 A.2d 1343 (1987)); cf. Alderman v. Pan Am World Airways, 169 F.3d 99, 102 (2d Cir.1999) ("`The standard of review of an award of attorney's fees is highly deferential to the district court.' ... This standard takes into account that the amount sought for attorney's fees is dependent on the unique facts of each case.... Attorney's fees must be reasonable in terms of the circumstances of the particular case, and the district court's determination will be reversed on appeal only for an abuse of discretion." (citations omitted)).

Courts considering fee applications under CUTPA calculate attorneys' fees through the "lodestar" method. Societa Bario E Derivati v. Kaystone Chem., Inc., No. 5:90-CV-599, 1998 WL 182563, at *11 (D.Conn. Apr.15, 1998); see also Kaplan v. Gruder, No. CV 960334308S, 2000 WL 767679, at *1 (Conn.Super. May 25, 2000). "Such a calculation requires the Court to determine the number of hours reasonably spent on the litigation and to exclude hours which are excessive, redundant or otherwise unreasonable." Societa Bario, 1998 WL 182563, at *11 (citation omitted). "There exists a strong presumption that the lodestar figure represents a reasonable fee." Id. (citation omitted). "Calculation of the lodestar also requires the Court to determine the `prevailing market rates' for the type of services rendered, i.e. the fees that would be charged for similar work by attorneys of like skill in the area." Id. (citations omitted); see also Kirsch v. Fleet Street, Ltd., 148 F.3d 149, 172 (2d Cir. 1998) ("The lodestar should be based on `prevailing market rates,' Blum v. Stenson, 465 U.S. 886, 895, 104 S.Ct. 1541, 79 L.Ed.2d 891[] (1984), for comparable attorneys of comparable skill and standing in the pertinent legal community.").

Despite the use of the lodestar method which is familiar from other contexts in which fee awards are authorized by statute or common law, "[t]he award of attorney's fees and punitive damages under CUTPA has some features not common to such awards in other types of cases." Jacques of All Trades Corp. v. Brown, 42 Conn.App. 124, 131, 679 A.2d 27 (1996) ("Jacques I"), aff'd, 240 Conn. 654, 692 A.2d 809 (1997). First, the statute speaks of "the plaintiff" recovering fees and does not contain the "prevailing party" language found in other attorney's fees statutes. Compare Conn. Gen.Stat. § 42-110g(d) with 42 U.S.C. § 1988(b). Thus, consideration of whether a civil rights plaintiff "prevailed" when he recovered nominal damages or lost on some of his factual or legal theories is not present in CUTPA cases. See Jacques I, 42 Conn. App. at 131, 679 A.2d 27 (citing Tillquist v. Ford Motor Credit Co., 714 F.Supp. 607 (D.Conn.1989)). Second, and perhaps more significant, is the express statutory proscription that whether to award fees, and if so how much, is not to be based on the dollar amount of the recovery. Id. (citing Conn. Gen.Stat. § 42-110g(d)).

To determine the reasonableness of the fees a CUTPA plaintiff is seeking, the Connecticut Appellate Court has held that the factors identified by the court in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 715 (5th Cir.1974), a case arising under the Federal Civil Rights Act of 1964, apply to fee applications under CUTPA. See Steiger v. J.S. Builders, Inc., 39 Conn.App. 32, 38, 663 A.2d 432 (1995); see also Jacques All Trades Corp. v. Brown, 57 Conn.App. 189, 198, 752 A.2d 1098 (2000) ("Jacques II"); Hernandez v. Monterey Village Assoc. Ltd. P'ship., 24 Conn. App. 514, 517 n. 3, 589 A.2d 888 (1991). The Johnson factors are:

(1) the time and labor required;

(2) the novelty and difficulty of the questions;

(3) the skill requisite to perform the legal service properly;

(4) the preclusion of other employment by the attorney due to acceptance of the case;

(5) the customary fee for similar work in the community;

(6) whether the fee is fixed or contingent;

(7) time limitations imposed by the client or the circumstances;

(8) the...