Sun Pub. Co. v. Mecklenburg News, Inc., Civ. A. No. 81-1071-R.

• Decision Date: 11 October 1984
• Docket Number: Civ. A. No. 81-1071-R.
• Citation: 594 F. Supp. 1512
• Parties: SUN PUBLISHING COMPANY, INC. et al., Plaintiffs, v. MECKLENBURG NEWS, INC., et al., Defendants.
• Court: U.S. District Court — Eastern District of Virginia

594 F. Supp. 1512

SUN PUBLISHING COMPANY, INC. et al., Plaintiffs, v. MECKLENBURG NEWS, INC., et al., Defendants.

Civ. A. No. 81-1071-R.

United States District Court, E.D. Virginia, Richmond Division.

October 11, 1984.

COPYRIGHT MATERIAL OMITTED

William W. Bennett, Jr., Slayton, Bennett & Rand, South Boston, Va., J. Robert Brame, III, Edward E. Nicholas, III, McGuire, Woods & Battle, Howard Feller, Richmond, Va., and Larry D. Sharpe, Bergson, Borklank, Margolis & Adler, Washington, D.C., for defendants Mecklenburg News, Inc., t/a The News-Progress, a Virginia corp., Keith A. Shelton and Douglas E. Loftis, Jr. and counterclaim defendants.

Daniel A. Carrell, William F. Young, Donald R. Schmidt, Jessine A. Monaghan, Hunton & Williams, Richmond, Va., John H. Shenefield, Peter Halle, Dorothy A. Doherty, Milbank, Tweed, Hadley & McCloy, Washington, D.C., for plaintiff and counterclaim defendant McLaughlin and counterclaim defendant South Boston News, Inc.

James K. Dorsett, Jr., Michael E. Weddington, Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, Raleigh, N.C., Augustus C. Epps, Jr., Christian, Barton, Epps, Brent & Chappell, Richmond, Va., for Park Publications, Inc., Park Broadcasting, Inc. and Roy Park (Non-parties — subpoenae duces tecum).

MEMORANDUM

MERHIGE, District Judge.

The plaintiffs in this action ("Sun et al") won a jury verdict on their claims that the defendants violated federal antitrust laws in connection with their operation of newspaper publishing businesses in Mecklenburg and Halifax Counties, Virginia. Plaintiffs now seek an award of attorneys' fees and costs pursuant to Section 4 of the Clayton Act, 15 U.S.C. § 15. An initial petition, filed April 23, 1984, sought fees of $491,894.38 and costs of $23,806.14. A supplemental petition, filed June 1, 1984, seeks an additional $21,815.00 in fees for hours expended subsequent to the filing of the initial petition.

The defendants acknowledge that the plaintiffs are entitled to a fee award, but contend that the amounts requested are excessive in several regards. According to their calculations, an appropriate fee would be in the $60-90,000 range.

The parties have fully briefed and argued the matter and it is now ripe for disposition.

Background

This suit was commenced on December 14, 1981, alleging violations of federal and Virginia antitrust laws. Four sets of attorneys participated in representing the plaintiffs at various stages. Their original counsel was John W. Pearsall of McCaul, Grigsby, Pearsall & Davis, a Virginia firm. The case was originally scheduled to go to trial in September of 1982. Just prior to that date, plaintiffs elected to retain new counsel and in the interest of justice a continuance, rarely granted in this District, was obtained. Plaintiffs retained a team of lawyers, from the Washington, D.C. offices of Milbank, Tweed, Hadley & McCloy ("Milbank"), with special expertise and experience in the antitrust field. Pearsall then withdrew from the case, and Hunton & Williams of Richmond, Virginia came in as Milbank's local counsel. A fourth attorney, Donald Blumenthal, Esquire, apparently participated briefly in some capacity just before Milbank and Hunton & Williams were retained.¹

The Milbank team filed an amended complaint on plaintiffs' behalf on October 18, 1982. At that stage there were three parties-plaintiff, as follows: Sun Publishing Company, Inc., which published a newspaper in Mecklenburg County; South Boston News, Inc., which published one in Halifax County; and Tucker W. McLaughlin, who was and is, in essence, the owner and chief operating officer of the two plaintiff companies. There were seven named defendants at that stage as follows: Mecklenburg News, Inc., which published newspapers in Mecklenburg County; Douglas E. Loftis, Jr., who was the editor and a shareholder in Mecklenburg News; the Halifax Gazette Publishing Co., Inc., which published newspapers primarily in Halifax County; Keith A. Shelton, the president and a shareholder of Halifax Gazette; South Hill Publishing Co., Inc., which published a newspaper in Mecklenburg County; and Harry and Frank Nanney, the president and editor of South Hill Publishing.

At its broadest, plaintiffs' complaint included allegations that the defendants had conspired to restrain trade in violation of Section 1 of the Sherman Act; attempted and/or conspired to monopolize in violation of Section 2 of the Sherman Act; monopolized in violation of Section 2 of the Sherman Act; engaged in corresponding violations of the Virginia Antitrust Act, Va. Code § 59.1-9.1 et seq.; and conspired to injure another in his trade or business in violation of Va. Code § 18.2-499. The claims under the Virginia Antitrust Act also included an allegation of unlawful price discrimination. The defendants filed counterclaims making similar allegations against the plaintiffs.

The parties conducted extensive discovery and vigorously and frequently contested numerous motions. Before the case proceeded to trial in October, 1983, plaintiffs voluntarily dismissed South Hill Publishing Co. and the Nanneys as defendants; dismissed their claims of actual monopolization under Section 2 of the Sherman Act and the Virginia Antitrust Act; and dismissed all of McLaughlin's claims as an individual.

The trial as to all of the remaining issues commenced on October 17, 1983 and continued through October 25, 1983, with the plaintiffs seeking damages of $851,521 for profits the two companies allegedly lost from 1978 to 1982 as a result of defendants' antitrust violations, and the defendants seeking damages in excess of $1.5 million. At the close of plaintiffs' case, the Court directed a verdict for the defendants on the plaintiffs' Virginia price discrimination claim.

The jury returned a special verdict form finding for plaintiffs on each of the remaining claims and against the defendants on each of their counterclaims. The jury found damages of $158,000, to Sun only, as a result of the defendants' conspiracy to divide the market for advertising from a certain major advertiser (Heck's) in violation of Section 1 of the Sherman Act. On all the other counts submitted to them, the jury, though finding liability against the defendants, did not award any monetary damages.

On motion of the defendants, the Court reduced the single damages award to $29,094.87, finding that any larger amount would be purely speculative. (These damages were of course trebled to $87,284.61 in accordance with the damages provisions of the federal antitrust laws.)

The plaintiffs were given the option of a new trial on damages, but declined it.

I. Initial Fee Petition

A. The Request

The plaintiffs' initial petition seeks a fee award of $491,894.38. That amount is broken down according to the firms involved as follows:

                                              Fees
                  Milbank                  $338,355.55
                  Hunton & Williams          65,690.95
                  Blumenthal                  9,767.38
                  Pearsall                   78,080.50
                                           ___________
                                           $491,894.38
                                           ===========
                

Two sets of memoranda and affidavits were submitted in support of the fee request. One set, from Milbank, addresses the fees attributed to the services of Milbank, Hunton & Williams, and Blumenthal. The second set is from Pearsall and addresses only the fees attributed to his services.

The Milbank memoranda sets out the process whereby the Milbank, Hunton & Williams, and Blumenthal figures were derived. Briefly, partners at Milbank and Hunton & Williams reviewed their firms' timesheets on the case and deleted from the request all hours that they deemed to be unproductive or duplicative. This step resulted in deletions of over 20% of the hours accumulated. The remaining hours are detailed in affidavits from each firm. They then multiplied the resulting hours by the attorneys' customary billing rates and added them to the total fee generated by Mr. Blumenthal, who is described as having been paid on a weekly basis and as not having kept a record of his hours.

The total generated in this process was then adjusted downward by 35%, in recognition of the fact that plaintiffs' counsel spent considerable time in defending against the counterclaims, for which efforts plaintiffs do not seek a fee award. Because the claims and counterclaims were interwoven and the issues involved often overlapped, the plaintiffs judged it impossible to determine exactly which hours were spent on the affirmative claims and which on the counterclaims. Accordingly, they used 35% as a rough estimate of the percentage of their time that was devoted to the counterclaims, and they have decreased their request accordingly.

The plaintiffs made no other adjustments in arriving at the amount requested as to these three sets of counsel.

The Pearsall memoranda and affidavits set out the hours that his firm spent on the case, as well as his customary rates. The Pearsall request is the product of these two figures.

B. General Principles Governing Attorneys' Fee Awards

The general principles governing the amount of statutory fee awards are well developed in this circuit. District courts are obliged to set out "detailed findings of fact" concerning attorneys' fee awards, in relation to twelve factors.² Barber v. Kimbrell's, Inc., 577 F.2d 216, 226, 226 n. 28 (4th Cir.1978). The Court of Appeals for the Fourth Circuit has further specified the appropriate approach to attorneys' fee determinations in Anderson v. Morris, 658 F.2d 246 (4th Cir.1981). The basic approach is to multiply the customary hourly rate for the services rendered by the number of hours reasonably expended; the product of these two is the so-called "lodestar" figure. The lodestar is then adjusted on the basis of enumerated other factors, which are the same as the last seven of the twelve factors recognized in Barber v. Kimbrell's, Inc., supra, as appropriate considerations in...