Morris v. Scenera Research, LLC
| Decision Date | 31 May 2017 |
| Docket Number | 09 CVS 19678 |
| Citation | 2017 NCBC 47 |
| Parties | ROBERT PAUL MORRIS, Plaintiff, v. SCENERA RESEARCH, LLC and RYAN C. FRY, Defendants. |
| Court | Superior Court of North Carolina |
Young Moore and Henderson, P.A., by Walter E. Brock, Jr. and Andrew P. Flynt, for Plaintiff.
Parker Poe Adams & Bernstein LLP, by Catharine B. Arrowood and Scott E. Bayzle, for Defendants.
1. THIS MATTER is now before the Court on Plaintiff's five motions seeking an award of attorneys' fees and expenses (hereafter collectively referred to as "attorneys' fees") incurred at different stages of the litigation and on Morris's Motion to Strike Defendants' Reply to Morris's Request for Pre-judgment Fees and Expenses ("Motion to Strike"). For the reasons discussed below, the Court DENIES Plaintiff's Motion to Strike and awards Plaintiff attorneys' fees in the amount of $843 405.59.
1. MATTER BEFORE THE COURT AND SUMMARY OF AWARD
2. This case was tried before a jury in January 2012. At the conclusion of the trial, Plaintiff had prevailed on his statutory claims for unpaid wages and retaliatory discharge and Defendant Scenera Research, LLC ("Scenera") had prevailed on the invention and patent ownership claims. This Court entered the Judgment based on the jury verdict on May 14, 2012 ("2012 Judgment"). The case has now returned to this Court, after appeals to the North Carolina Court of Appeals and the North Carolina Supreme Court, for resolution of the sole issue of Plaintiff's award of attorneys' fees.
3. Ultimately, each aspect of the 2012 Judgment was upheld after appeals to the Court of Appeals and Supreme Court, except the award of attorneys' fees, which the Court of Appeals reversed and remanded. Plaintiff successfully defended his monetary recoveries on his wage and discharge claims, as well as his right to attorneys' fees on those claims, but unsuccessfully challenged other portions of the 2012 Judgment. Defendants successfully defended the ruling in their favor that Plaintiff has no ownership rights in inventions made during the course of his employment or in patent applications or issued patents related to those inventions, which the Court refers to as "ownership claims."
4. In the 2012 Judgment, the Court, in its discretion, awarded Plaintiff $450, 000 of the $819, 752.41 requested for fees incurred up to the time of judgment. Morris v. Scenera Research, LLC, No. 09-CVS-19678, 2012 NCBC LEXIS 29, at *30- 33 , aff'd in part and rev'd in part, 229 N.C.App. 31, 747 S.E.2d 362 (2013), aff'd in part and rev'd in part, 368 N.C. 857, 788 S.E.2d 154 (2016). While the Court found that all of Plaintiff's fees had been reasonably incurred and charged at reasonable rates, it concluded that the request should be reduced to make the award "reasonable in relation to the results obtained." Hensley v. Eckerhart, 461 U.S. 424, 440 (1983); see Morris, 2012 NCBC LEXIS 29, at *30-33. In doing so, the Court determined that fees should be apportioned between Plaintiff's successful and unsuccessful claims.
Morris, 229 N.C.App. at 56, 747 S.E.2d at 377-78 (alterations in original) (emphasis added) (quoting Brief for Plaintiff/Cross-Appellant at 22-23, Morris, 229 N.C.App. 31, 747 S.E.2d 362 (No. COA12-1481)). In short, the Court of Appeals' holding essentially mandates that Plaintiff must recover all fees related to any claim arising from a nucleus of operative facts common to his successful wage and discharge claims.
6. The parties cross-appealed other issues to the North Carolina Supreme Court, but neither party appealed the Court of Appeals' holding on the award of attorneys' fees.
7. The Court has been directed to make fact findings as to which fees incurred prior to the 2012 Judgment relate to claims that arise from a nucleus of operative facts common to Plaintiff's successful claims. See Morris, 2016 NCBC LEXIS 101, at *27; see also Morris, 229 N.C.App. at 56, 747 S.E.2d at 377-78. In directing that no fees should be apportioned if they arise from a nucleus of operative facts common to Plaintiff's successful claims, the Court of Appeals severely limited the Court's discretion.[1] Earlier Court of Appeals decisions had held that a trial court is not required to apportion fees among successful and unsuccessful claims, but had not prohibited a trial court from apportioning fees between claims in order to award an amount that would be reasonable in relation to the plaintiff's overall success. Unfortunately, the elimination of that discretion has led, and will likely lead in other cases, to extended litigation over which fees relate to which claims. This case also presents the unsettled question whether a plaintiff can, in addition to the initial award of attorneys' fees, recover fees incurred in defending the initial award.
8. Further background on this litigation is available in the multiple reported decisions issued as the case wound through the trial and appellate process. See, e.g., Morris, 368 N.C. 857, 788 S.E.2d 154, aff'g in part and rev'g in part 229 N.C.App. 31, 747 S.E.2d 362, aff'g in part and rev'g in part 2012 NCBC LEXIS 29; Morris v. Scenera Research, LLC, No. 09-CVS-19678, 2016 NCBC LEXIS 101 (N.C. Super. Ct. Dec. 19, 2016); Morris v. Scenera Research, LLC, No. 09-CVS-19678, 2012 NCBC LEXIS 1 (N.C. Super. Ct. Jan. 4, 2012).
9. The attorneys' fees motions now before the Court are (1) Plaintiff's Motion for Supplemental Relief, filed on March 7, 2012, and supplemented on April 18, 2012, and May 10, 2012, seeking fees incurred through April 30, 2012, in the amount of $819, 752.41 ("Prejudgment Fees"); (2) Plaintiff's Motion for Attorneys' Fees Incurred After Entry of Judgment, filed on July 19, 2012, seeking fees incurred defending against Defendants' Motion for Judgment Notwithstanding the Verdict ("JNOV") or, in the Alternative, for a New Trial, between May 1, 2012, and June 30, 2012, in the amount of $29, 049.56; (3) Plaintiff's Motion for Attorneys' Fees and Expenses Incurred on Appeal to the North Carolina Court of Appeals, filed on June 28, 2016, seeking fees incurred during the appeal to the North Carolina Court of Appeals between July 1, 2012, and September 5, 2013, in the amount of $133, 027.16; (4) Plaintiff-Appellee/Cross-Appellant's Motion for Attorneys' Fees Incurred on Appeal, filed with the Supreme Court on June 22, 2016, and remanded to this Court, seeking fees incurred during the appeal to the North Carolina Supreme Court between September 6, 2013, and May 19, 2015, in the amount of $163, 101.83; and (5) Plaintiff's Motion for Attorneys' Fees Incurred After the North Carolina Supreme Court's Decision, filed March 9, 2017, seeking fees incurred between June 10, 2016, and February 28, 2017, on the remanded issue of attorneys' fees in the amount of $95, 570.94 (collectively the "Motions"). Together, the Motions seek an award of $1, 240, 501.90 in attorneys' fees and also seek interest on that award.
10. In the following discussion, the Court divides its analysis between the award of attorneys' fees incurred prior the 2012 Judgment, which was reviewed by the Court of Appeals, and the award of attorneys' fees incurred after judgment, which has not been reviewed by the Court of Appeals. The Court expressly incorporates its December 19, 2016 Order and Opinion on Request for Attorneys' Fees ("December Order"), which summarized its understanding of the Court of Appeals' mandate regarding the award of prejudgment attorneys' fees. See Morris, 2016 NCBC LEXIS 101, at *27-32.
11. The Court concludes that a substantial portion of Plaintiff's efforts related to a nucleus of facts common to all claims because the efforts and claims were inextricably intertwined. See Hensley, 461 U.S. at 435 (); Okwara v. Dillard Dep't Stores, Inc., 136 N.C.App. 587, 595, 525 S.E.2d 481, 487 (2000) (). It is now difficult to parse those efforts between individual claims on which Plaintiff succeeded and those which he did not. The Court's award of attorneys' fees in the 2012 Judgment was not based on parsing efforts between successful and unsuccessful claims.
12. The 2012 Judgment did not reduce the award of attorneys' fees based on findings that certain fees were related distinctly to claims that did not relate to the common nucleus of operative facts. Rather, the Court exercised its discretion to reduce the fee award to insure that the award was reasonable in relation to Plaintiff's success. To the extent that the Court of Appeals' reversal of the 2012 Judgment rested on this Court's failure to adequately explain the factors it considered in making its discretionary award, in the...
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