### FILED SEPTEMBER 8, 2016 In the Office ofthe Clerk ofCourt WA State Court ofAppeals, Division III IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION THREE LAKODA, INC., a Washington corporation, Respondent,


### v. ) ) ) ) ) ) ) OMHPROSCREENUSA, INC., a ) Washington corporation; BRAD ) HILMOE, a married individual; JOHN ) O'CONNELL, a married individual; OMH ) INNOVATIONS, INC., a foreign ) corporation, ) Appellants. OMHPROSCREENUSA, INC., a Washington corporation, Third-Party Plaintiff, V. DALEAMES and DODIE AMES, husband and wife, and the marital community comprisedthereof, Third-Party Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) No. 32616-1-111

UNPUBLISHED OPINION

SIDDOWAY, J. -OMHProscreen USA, Inc. and its codefendants in the trial below appeal the results ofa 9-dayjurytrial at the conclusion ofwhichthejury awarded
a total of$250,002 in damages to Lakoda, Inc., for breach ofcontract, tortiousNo. 32616-1-111 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
interference with a business expectancy, and misappropriation oftrade secrets. The trial court awarded an additional $231,441 in attorney fees. The defendants challenge the trial court's exclusion ofevidence they contend was critical to their defense and counterclaims, the admissibility and sufficiency ofLakoda's evidence ofdamages, and the trial court's award ofattorney fees. We find no error or abuse ofdiscretion and affirm. FACTS AND PROCEDURAL BACKGROUND Lakoda is a self-described "contract manufacturer." 1Report ofProceedings (RP) (May 6, 2014) at 66. It acts as an intermediary between businesses that need a product manufactured and factories that can deliver an acceptable product at an acceptableprice. As middle man, Lakoda identifies a factory capable ofproducing the desired product, obtains a price, marks it up, and then offers the productto the manufacturing customer at the marked-up price. Toprotect itselffrom customers who mighttry to go around it and contract directly withthe factory once the manufacturing operation has been established, Lakodahas a vendor nondisclosure agreementthat it requires customers to sign before arranging manufacturing services. Among areas ofthe world in which Lakoda has established expertise and manufacturing contacts is China. Its manufacturing contacts in China at times relevant to this dispute included the Longfei factory in Changzhou, and Geng Min, an engineer and the owner ofa business called Tomorrow Product Development, orTPD. Virtually all 2

### No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.
references to Geng Min during trial were as "Peter" or "Peter G.," his nickname, which
we will use, intending no disrespect. In March 2010, Dale Ames, Lakoda's owner, met Brad Hilmoe, an officer and
owner ofOMH or its affiliatesI 

### on a flight to San Francisco. Both men's ultimate destination was China. OMH was in the business ofselling soil screening equipment and at the time was having some ofits soil screeners manufactured at a factory in Yantai. The products were not being made to Mr. Hilmoe's satisfaction. After Mr. Hilmoe returned to the states, he arranged for Mr. Ames to meet with him and his co-owner ofOMH, John O'Connell, to explore whetherto have Lakoda assist them in lining up manufacture oftheir soil screeners in a different Chinese factory. Before the meeting, Mr. Ames e-mailed Lakoda's standard nondisclosure agreement to 

### Mr. Hilmoe. The agreement contains provisions protecting both Lakoda's and "the Vendor's" (in this case, OMH's) "Confidential Information" disclosed in connection with evaluating a potential "customer/supplierrelationship." The agreement defines "Confidential Information" as

1

### Attrial, the three affiliated OMH companies named as defendants presented a united defense. Midtrial, Lakoda stipulatedto dismissal ofits claims against the Canadian corporation, OMH Innovations, Inc. Judgment was entered against the two remaining corporations. Since the history and roles ofthe entities need not be distinguished (and from the record, probably could not be) we refer to them individually and collectively as "OMH." 3

### No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.
all information of eitherParty that is notgenerally known to thepublic, whether of a technical, business or other nature 

### (including, without limitation, trade secrets, know how and information relating to the technology, customers, business plans, promotional and marketing activities, finances and otherbusiness affairs ofsuch Party), that (i) is disclosed by one Party (the "DisclosingParty") to the otherParty 

### (the "Receiving Party"), and (ii) ifin tangible form, is identified by the Disclosing Party
... as confidential.
. . . Confidential Information also includes all information concerning the existence and progress ofthe Parties' dealings. Ex. 5, at 1 (emphasis added). The agreementprovidedthat a receiving party would not disclose a disclosing party's confidential information without consent, that it would take measures to protect confidential information, and that it "[would] not use, or permit others to use, Confidential Information for any purpose other than evaluation and performing its obligations under any customer/supplier relationship between the parties resulting therefrom." Id 

### Mr. Ames signed the agreement on behalfofLakoda, Inc., and Mr. O'Connell signed on behalfofOMH. Theparties then orally agreed that Lakoda would undertake to identify a new manufacturing source in China for OMH'sproducts. OMH providedLakoda with target pricing for the screeners, some idea ofthe quantity to be produced, and OMH's screener designs. Armed with this information, Mr. Ames contacted Peter, who worked with the Longfei factory to arrive at a quote for producing the screeners.

4

### No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.


### Lakodabegan to source parts necessary for the production ofthe screeners at Longfei and manufacturing began. For almost a year, OMH accepted Lakoda quotes, providedLakoda with purchase orders, and Lakoda invoiced OMH at the marked-up price it had quoted. In October 2010, OMH hired an employee in Chinato monitor quality control at Longfei. His name was Wang Fuliang, but most witnesses at the trial referred to him by his nickname, "Jack." Through Jack and through his owntime spent in Changzhou, Mr. Hilmoe began to receive information about how Longfei was faring under the manufacturing relationship. He learned Longfei's management was disgruntled about slow payment and the price it was receiving for the screeners. The information Mr. 

### Hilmoe received led to a dispute between OMH and Lakoda over whetherLakoda was taking a bigger markup than had been agreed, leaving Longfei with too little to make the manufacturing relationship worthwhile. Facingthreats from Longfei that it would cease manufacturing the screeners, OMH "cut [Lakoda] out ofthe picture" in April 2011 and beganpurchasing screeners directly from Longfei. 1RP (May 6, 2014) at 137-38. Lakoda filed suit against OMH and Mr. Hilmoe shortly thereafter, alleging breach ofcontract; breach ofthe implied covenant ofgood faith and fair dealing; violation of Washington's Uniform Trade Secrets Act, chapter 19.108 RCW; and tortious interference with a business expectancy. Lakoda accused OMH ofusing its confidential information



### 5No. 32616-1-III 

### Lakoda, Inc. v. OMHProscreen USA, Inc. (the identity ofthe Longfei factory and the screener manufacturing capability it had developed) in violation ofthe nondisclosure agreement.2 In answering the complaint, OMH counterclaimed, alleging Lakoda had failed to protect its proprietary designs in violation ofthe nondisclosure agreement and had violated an alleged oral agreement that Lakoda's markup ofLongfei's price would be limited to 10 percent. According to OMH, Peter or Lakoda misled Longfei about the volume ofscreeners OMH wouldpurchase, leading Longfei to quote a price at which it could not make money. OMH also claimed Lakoda did not obtain a nondisclosure agreement from Longfei until February 2011, two months 

### after Longfei registered OMH's designs in China, in Longfei's name. OMH contended Longfei alone could manufacture OMH's screeners in China and as a result, when Longfei refused to continue manufacturing unless it was paid more, OMH "was 

### forcedto renegotiate the terms ofthe manufacturing agreement" with Longfei. Clerk's Papers (CP) at 61 (emphasis added). Accordingto Mr. Hilmoe, "OMH had no recourse against the [Longfei] factory." CP at 208. Finally, OMH alleged Longfei sold OMH's designs to two Canadians, Viorel Mazilescu and Gerald Clancy,

2 After Lakoda learned in discovery ofthe OMH affiliates and that the business had not been incorporated when the nondisclosure agreement was signed, it amended its complaintto name the affiliates and Mr. O'Connell, individually, as defendants.

6No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.
whobegan selling "knock-off' screeners in competition with OMH. CP at 191. It accused Mr. Ames ofbeing complicit in that misappropriation ofits designs. Inpretrial rulings, the courtheld that a documentthat appeared to be written in Chinese and that OMH represented was Longfei's "registration" in China ofits drawings
was inadmissible. Itreserved ruling onwhethertestimony aboutthe registration would be admitted. When OMH soughtto elicittestimony about the registration during trial, the court sustained an objection to its relevance. OMH renewed its effortto offerthe evidence afterLakoda allegedly "openedthe door" by inquiring into what measures OMHhad taken to protect its designs in the United States and Canada. The court againheld that testimony aboutthe alleged Chinese registration was not relevant. Also during trial, the court excluded a portion oftestimony from Gerald Clancy's perpetuation deposition about a videoclip, as well as the videoclip itself, which OMH offered as evidence during the deposition. The court rejected OMH's argument that Mr. Clancy's limitedtestimony about the videoclip was relevant or sufficient. A halftime motion by OMH on several claims was denied. After a week and a halfoftrial, thejuryreturned a special verdict in favor of Lakoda on every claim and counterclaim. It awarded $1 in damages onthe tortious interference claim, $1 in damages for misappropriation oftrade secrets, and $250,000 for breach ofcontract. Lakoda contended, and the trial court agreed, thatthe three claims 7

### No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc. 

### overlapped and that the $1 verdicts merely reflected thejury's compliance with the court's instruction not to duplicate damages. The court thereafter granted Lakoda's motion for an award ofattorney fees on its trade secret claim, finding reasonable attorney fees of$231,441. OMH appeals. ANALYSIS OMH assigns errorto (1) the trial court's exclusion ofevidence that Longfei registered its designs in China, including after Lakoda allegedly "openedthe door" to that evidence; (2) the court's exclusion ofa videoclip and testimony offered as authentication; (3) the court's denial ofits halftime motion that its nondisclosure agreement with Lakoda barred recovery oflostprofits; (4) the trial court's denial ofits halftime motion on Lakoda's trade secret claim; (5) the trial court's admission ofLakoda's damage summaries and the sufficiency ofthose summaries to supportthejury'sverdict; and (6) the trial court's award ofattorney fees. We address the issues in the order stated. I. Exclusion ofevidence ofChinese "registration" A. Initial exclusion 

### Before trial, Lakoda filed a motion in limine asking the courtto exclude all evidence and argument that Longfei had registered OMH's screener designs in China. Among its arguments were that Chinese law had not beenpleaded as required by CR 9 and 44.1 and the legal effect ofany registration (ifits proposed exhibit was 

### a registration) 8No. 32616-1-III 

### Lakoda, Inc. v. OMHProscreen USA, Inc.

was unknown by the parties orthe court. It also argued that because a culpable mental state was not relevant to Lakoda's claims, Mr. Hilmoe's motivation for continuingto work with Longfei was irrelevant. OMH responded that it intendedto offer evidence ofthe registration and authentication through Xiao Ping Zahang, an owner or manager ofthe Longfei factory, who could read Chinese. Either Mr. Zahang orMr. Hilmoe couldtestify to their understanding ofthe registration's significance. It argued that Mr. Hilmoe's motivation
was relevant to its affirmative defense to Lakoda's tortious interference claim and the element ofwillfulness or maliciousness underthe Uniform Trade Secrets Act, chapter 19.108 RCW. The court ruled that the purported registration, defendants' proposed Exhibit 329,
was irrelevant, would not be admitted, and that it would sustain an objectionto testimony about the actual legal effect ofregistration. But it reserved ruling on whetherto admit evidence bearing on Mr. Hilmoe's beliefs and how they affected his motivation in continuing to workwith Longfei. When OMH called Mr. Zahang at trial, he was allowed to answerthe following questions about registration: Q [ A]tthat time that you decided not to manufacture anymore, were you concerned about the money that you had invested in building the screeners? A Yes.
9No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc. Q Did you take any measures to try toprotect your investmentthatyou hadput into the manufacture ofthe screeners? Yes orno, please. A Toprotectthe product, we applied to get a document. [LAKODA'S LAWYER]: Judge, I'm goingto object. This goes to the Motion in Limine. THE COURT: I understand. Ifhe can answer the question as a yes or no, can he answerthe question as it's asked as a yes or no? THE WITNESS: Yes. 2 RP (May 7, 2014) at 306-07. Shortly thereafter, Mr. Zahangreferredto a time "[w]hen I told, you know, they are not working with Peter anymore [sic]." 2 RP (May 7, 2014) at 307. He was then asked, and answered:



### Id. Q Atany time subsequent-anytime afterthat, did you tell Brad orJack that Longfei was the only one that was allowed to manufacture screeners in China? A Yes.

OMH then called Mr. Hilmoe as a witness, andthe following testimony was given and objections were made: Q Do you recall hearing [Xiao Ping] state that he believedthat only the Longfei factory could manufacture yourproduct? A Yes. Q What was yourunderstanding ofthat situation? A I no longer had any control over my designs at the time. 3 RP (May 8, 2014) at 540. When OMH's lawyerthen asked Mr. Hilmoe how he came to that conclusion, the trial court sustained the objection. In analyzing OMH's asserted need for evidence ofthe Chinese registration, we bear in mindthat OMH offered otherreasons why it had no choice butto agree to 10No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.
continue a business relationship with Longfei that excluded Lakoda. They included the timing ofthe threatened termination ofmanufacture which camejust as OMHwas moving into its busiest sales season. OMH also contended Lakoda failed to obtain a nondisclosure agreement from Longfei until February 2011, well after Lakodahad already passed along the screener designs. Mr. Zahang testified during his direct examinationthat the "2010. 4. 15" date he had written when he signed the Lakoda/Longfei nondisclosure agreement was notthe date he actually signed it. CP at 281. Instead, he testified, the agreement, which he said
was characterized to him by Peter as having somethingto do with quality control, was not presented to him until about six months afterthat date. In closing argument, OMH's lawyertold thejury: Longfeisays we 're going to buildall the screeners that we canproduce, andif you, OMH, don't buy it, we 're going to sell [them] to someone else, andtheyput up OMH's ownproducton their own website, andtheysteal the website informationfrom OMHandgo into businessfor themselves. Soyoumight be askingyourselves, how can they do that? Longfei had signed an NDA [nondisclosure] agreement. ... [B]utthere's a lot of discrepancies to this, folks. We've got an [agreement] effective July 9, 2010 that's signed on April 15, 2010, and you heard the testimony from Mr. Ames that he only obtained this NDA agreement in February of2011 when Mr. Hilmoe asked him to give him a copy ofit. We know thatthe NDA agreement [that] was signed
... states it's effective July 9, 2010, but is dated April 15, 2011 [sic],(3] and then we have

3 Presumably April 15, 2010. 11No. 32616-1-III 

### Lakoda, Inc. v. 

### OMHProscreen USA, Inc.
the cryptic e-mail from Mr. Ames to Peter saying I need anNDA agreement for OMH, and it will relate back to some earlier agreementthat Mr. Ames had with Peter. Let's go backnowto OMH. 

### Thefactory is competingwith OMHfor OMH's ownproducts. OMHis told it can'tbuilditsproductatany other factory in China. RP (May 15, 2014) at 121-23 (emphasis added). On appeal, OMH renews its arguments that evidence ofLongfei's registration of its screener designs was relevant and important to its defense to tortious interference and to whether it willfully and maliciously misappropriated a trade secret. 1. Relevance to defense to tortious interference Evidence is only admissible ifrelevant. ER402. Evidence is relevant ifit has any tendency to make the existence ofa fact ofconsequence more probable or less probable than it would be withoutthe evidence. ER401. A trial court's decision regarding relevancy will notbe reversed absent an abuse ofdiscretion. 

### State v. 

### Suarez-Bravo, 72 Wn. App. 359, 364, 864 P.2d 426 (1994). The court instructed thejurythat OMH and Mr. Hilmoe claimed that "even iftheir conduct interfered with Lakoda'sprospective business relationship or future contract, that conduct wasjustifiedbecause they were acting reasonably to protecttheir financial interest from being harmed." CP at 1036 (Jury Instruction 28). It further instructedthe

To establishthe defense offinancial interest, the Defendants have the burden ofproving each ofthe following propositions: 12No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc.

Id. (1) Thatpriorto any conduct ofthe Defendants interfering with a business relationship or future contract ofLakoda, Inc., the Defendants had a financial interest connected to Longfei; and (2) Thatthe Defendants did notuse wrongful means toprotect that interest from harm.

An implicitjury finding, unchallengedby OMH, is thatby entering into the agreementwithLongfei that excluded Lakoda, OMH interfered withthe Lakoda/Longfei nondisclosure agreement and the purchase orders expectedto arise from it. In defending, OMH was entitled to offer relevant, admissible evidence that its interference was privileged ifit had acted, without using wrongful means, to protect an existing financial interest ofits own. In that connection, it offered evidence ofseveral
reasons for its actions, including its evidence, alluded to in closing argument, that

### Mr. Hilmoe orJack was told by Mr. Zahangthat "Longfeiwas the only one that was allowed to manufacture screeners in China" and that Mr. Hilmoe understood he "no longer had control over [his] designs." 2 RP (May 7, 2014) at 307; 3 RP (May 8, 2014) at 540. The court allowed OMHto offerthis evidence ofLongfei's bare assertion ofits rights but excluded evidence of"registration" because OMH never pleaded the foreign law that would make information about "registration" meaningful to thejury. Evidence that is meaningless has no "tendency to make the existence ofany fact that is of consequence moreprobable or less probable" as required for it to be relevant under ER401. 13

### No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc. Instead, OMH soughtto inform thejury about "registration" through the testimony ofa lay witness offering a lay understanding ofits legal effect. ButER701 provides that for a lay witness to testify to an opinion it must be rationally based on the witness's perception, helpful to a clear understanding ofthe witness's testimony or a fact in issue, and not based on scientific, technical, or other specialized knowledge. And even legal experts are not permitted to testify about issues oflaw, which is the province ofthe court. Crow Tribe of Indians v. Racicot, 87 F.3d 1039, 1045 (9th Cir. 1996). OMH misreads the Washington decisions it cites as supporting its right to offer a lay witness's beliefor understanding aboutthe law.4 

### And the Ninth Circuit decision it cites actually undercuts its position. InNationwide Transport Finance v. Cass Information Systems, Inc., the court affirmed the trial court's ruling that a businessman defending his company's alleged tortious interference couldprovide testimony "regarding why he believed [the plaintiff] actedimproperly and why he believed itwas reasonable to rescind [a] hold harmless agreement," but could nottestify that the reason he thought he could rescind the agreement was his understanding orbeliefthat the

4 

### Skagit State Bankv. Rasmussen, 109 Wn.2d 377, 745 P.2d 37 (1987) does not analyze, let alone hold, that a witness may testify to the legal effect ofa document. Bennett v. 

### Shinoda Floral, Inc., 108 Wn.2d 386,394, 739 P.2d 648 (1987) never discusses the plaintiffs' understanding ofthe legal effect ofsettlement releases they signed, but only whether a releasor "fairly and knowingly" releases claims when he knows he has been injured but does not know the extent or consequences ofthe injury. 14

### No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc. 

### plaintiffhad violated the Uniform Commercial Code (U.C.C.). 523 F.3d 1051, 1060 (9th Cir. 2008) (emphasis added). OMH was allowed to present equivalent evidence ofwhat it contended was Lakoda's improper action and its reasonable response. The courtproperly sustained objections to OMH's efforts to present a lay witness's understanding ofthe legal landscape. Since thejurywould have no basis for assessing the concept ofregistration or its consequences, the court did not abuse its discretion in finding evidence about registration to be irrelevant.5 

### 2. Relevance to "willful and malicious" trade secret misappropriation The Uniform Trade Secrets Act provides that "[i]f
...willful and malicious misappropriation exists, the court may award reasonable attorney's fees to the prevailing party." RCW 19.108.040. The special verdict form askedjurors whether OMH's or Mr. Hilmoe's "misappropriation ofa trade secret owned by Lakoda [was] willful and malicious," to whichjurors answered yes. CP at 1060. Only "malicious," not "willful," was defined for thejury. "Malicious"was defined as

5 

### Although not argued on appeal and not the stated grounds for the trial court's exclusion ofthe registration, the evidence could also have been excluded under ER403, based on its potential for confusing the issues or misleading thejury.
15

### No. 32616-1-III Lakoda, Inc. v. 

### OMHProscreen USA, Inc.
characterized by, or involving, malice, having, or done with, wicked or mischievous intentions or motives; wrongful and done intentionally without just cause or excuse. CP at 1044 (Jury Instruction 33). Evidence ofregistration was irrelevanthere for the same reason it was irrelevant to OMH's affirmative defense to the tortious interference claim. Because OMH had not pleaded foreign law and could not inform thejury ofthe legal significance ofregistration through a lay witness, thejurywould not know what "registration" meant. Evidence referencing it would have been meaningless. The trial court did not abuse its discretion in sustaining Lakoda's objections to the registration evidence. B. 

### Revisiting rulingsfollowing an "openeddoor" OMH argues the trial court abused its discretion when it continued to sustain objections to evidence about registration after Lakoda examined witnesses about OMH's failure to take steps to protect its purported trade secret information, including the fact that OMH held no U.S. or Canadianpatents. Lakoda's examination was relevant to its defense to OMH's trade secret claim and came in without objection. Whether information is a "trade secret" depends in part on whether it "[i]s the subject ofefforts that are reasonable under the circumstances to maintain its secrecy." RCW 19.108.010(4)(b). As pointed outby Professor Tegland, there are two senses in which questioning a witness can be said to "open a door" and thereby waive evidentiary objections. One 16No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.

sense is where a party introduces evidence ofquestionable admissibility itself. 5 KARL B. TEGLAND, WASHINGTON PRACTICE: EVIDENCE LAWAND PRACTICE§ 103.14 (5th ed. 2007). A second sense is where, by being the first to raise a subject matter at trial, a party invites the opposingparty to explain, clarify or contradict its evidence. Id. at § 103.15, at 80. "Rules ofevidence are designed to aid in establishing the truth," and refusing to allow a party to respond to a subject opened up by its adversary "mightwell limit the proofto half-truths." State v. Gefeller, 76 Wn.2d 449,455,458 P.2d 17 (1969). If questioning "opens the door" with admissible evidence in this second sense, it does not waive all objections to any evidence its adversary offers in response. There is only one respect in whichthe trial court's continued exclusion of registration evidence arguably prevented OMH from explaining, clarifying or contradicting Lakoda's evidence about OMH's lack ofeffortto maintain the secrecy of its screener designs: it prevented OMH from trying to prove that once the Longfei factory registered the screener designs as its own, there was nothing OMH could do to protect itselffrom that particular compromise ofsecrecy. Outside the presence ofthejury, OMH's lawyer made the following offer ofproof: IfMr. Hilmoe were allowed to testify on the subject, he would be expectedto offer evidence that he was given copies ofthe design registrations that were filed in China. Based on his investigation, he was of the beliefthat the Longfei factory owned the right to the OMHProscreen brand collar designs in China, and that only Longfei could produce the screeners in China.
17No. 32616-1-III 

### Lakoda, Inc. v. 

### OMHProscreen USA, Inc.
5 RP (May 13, 2014) at 861. Here again, for reasons earlier stated, Mr. Hilmoe's lay beliefabout the legal effect ofregistration, including his apparent understanding that a wrongful registration could not be challenged, was inadmissible underER701. Other evidence concerning registration was irrelevant not because evidence that OMH tried toprotect secrecy was 

### irrelevant-meaningful evidence about efforts to protect secrecy 

### wouldbe relevant. Evidence concerning registration was irrelevantbecause without guidance on the legal effect ofregistration-which could come only from the court-"registration"was meaningless. The trial court did not abuse its discretion. II. Exclusion ofvideoclip and supporting deposition testimony OMH conducted a perpetuation deposition ofGerald Clancy, one ofthe Canadians allegedly selling "knock off' screeners using OMH designs. Onthe trial day when lawyers read the deposition to thejury, the court entertained objections to portions ofthe deposition. One ofLakoda's objections was to 

### 5 questions and responses dealing with a 10- second videoclip the defendants had identified as theirproposed Exhibit 330. The pertinent questions posed and answers given during the perpetuation deposition were: Q.
. .. [D]o you recall as part ofyour prior deposition producing a document that was on a video oftesting ofone ofthe screeners? A. Yes, I do. Q. I want to showyou a video. Andthis is marked as ....Defendants' D-330
.... I'm going to go ahead and play this video for you. 18No. 32616-1-111 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
CP at 622-23. OMH's lawyerthen playedthe video twice for Mr. Clancy. The questioning continued: Q. Does that appearto be a correct copy ofthe video thatyou submitted in conjunction with yourprevious deposition? A. Itappears tobe. [OMH'S LAWYER]: Move to admit defendants' 330. [LAKODA'S LAWYER]: I'm goingto object based on foundation and hearsay. And I haven'tbeen provided a copy ofthat video so I'm goingto reserve any right to object at the time [of] trial. [OMH'S LAWYER]: Q. Submitted as D-330. Doyou recognize the individual that was testing that screener in that video? A. I do not. Q. You don't know ifthat is Peter G. or TG? A. I do not. CP at 623. Before the perpetuation deposition was read, Lakodarenewed its objectionto a lack offoundation for admitting the videoclip and asked the court to exclude the related testimony. The court sustainedthe objection. Itis OMH'sposition that it needed to lay a two-part foundation for the videoclip: its relevance depended on the facts that (1) it was received byMr. Clancy in connection with the "knock-off' screeners he was purchasing, and (2) it depicted Peter. OMH argues
on appeal thatthe foundation it laid in the perpetuation deposition was sufficient for the limitedpurpose ofestablishingthat the videoclip had beenreceived byMr. Clancy. As OMH's lawyer argued to the trial court when the objection was raised at trial, "The relevance is going to come later, YourHonor. We believe it depicts Peter Geng testing 19

### No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc.


### this machine, and we have witnesses that will be able to identifyhim in that video." 5RP (May 13, 2014) at 821. 

### ER 104(b) provides that when the relevancy ofevidence depends on the fulfillment ofa condition offact, a trial court shall admit it either "upon, or subject to" the introduction ofevidence sufficient to support a finding ofthe fulfillment ofthe condition. The rule gives the court discretion to either admit the primary evidence subject to connecting up, orto refuse to admit the primary evidence until its relevance is shown by the foundation evidence. TEGLAND, supra,§ 

### 104.6, at 126. OMH challenges the trial court's ruling on appeal as ifthe court failed to provide it with the opportunity to "fulfill the condition" ofrelevance. But the trial court's actual reasoning was that the perpetuation deposition did not prove what OMH said it proved. As the court pointed out, at the perpetuation deposition Mr. Clancytestified only that he had submitted the videoclip in his previous deposition. He did not testify that the videoclip was one that he had received. OMH's lawyer admitted he would have to go back to Mr. Clancy'sprevious deposition to see ifthe testimony aboutreceiving the videoclip was there. 

### It was at that point that the court ruled, Atthispoint, 

### I don't see the relevance. I don't see it's been authenticated. So
... I'm going to go ahead and strike that at this time. 

### 5RP (May 13, 2014) at 822 (emphasis added).

20No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.
The clear implication ofthe trial court's ruling was that OMH was free to offer additional foundation later. But OMH did not thereafter seekto conditionally offer other deposition testimony and other witnesses to "connectup" relevance before offering the perpetuation deposition testimony and videoclip again. The trial court did not abuse its discretion by excluding the deposition testimony and videotape at the time they were offered. The deposition testimony had not been shown to be relevant or even conditionally relevant. III. Denial ofjudgment as a matter oflaw: breach ofcontract Paragraph 15 ofthe Lakoda-OMH nondisclosure agreement is a "Limitations on Liability" clause: Neitherparty shall be liable for special, indirect or consequential damages, or lostprofits, arising out ofor in connection withthis Agreement, whether based on contract, tort, including negligence, or otherwise. Ex. 5, at 3. Atthe close ofLakoda's case, OMH moved forjudgment as a matter oflaw
on its breach ofcontract claim, arguing Lakoda's only evidence ofdamages was oflost profits, liability for which is foreclosed by paragraph 15. Lakoda responded that paragraph 15 is ambiguous in light ofparagraph 8 ofthe agreement, captioned "Injunctive Relief," which acknowledges Lakoda's right to seek injunctive relief"in addition to [Lakoda's] otherrights and remedies"-implyingthat Lakoda has otherrights and remedies. Ex. 5, at 2. It argued that the contract would be illusory ifit did not afford a right to sue for benefit ofthe bargain damages, which, given 21No. 32616-1-111 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
the nature ofthe breach, were lost profits. Its final argument for ambiguity was that OMH had itselfsued for damages for breach ofthe same agreement. The court denied the motion for a directed verdict, deeming interpretation ofthe contractto be a question for thejury. In closing argument, OMHpointed out the limitation on liability clause to thejury. Thejury still returned a verdict finding $250,000 in damages for the breach ofcontract claim. Judgment as a matter oflaw is appropriate when no competent and substantial evidence exists to support a verdict. 

### Paetsch v. Spokane Dermatology Clinic, P.S., 182 Wn.2d 842,848,348 P.3d 389 (2015). In reviewing the denial ofa CR 50 motion for judgment as a matter oflaw, all facts and reasonable inferences are construed in favor of the nonmovingparty. 

### Yakima Fruit & 

### ColdStorage Co. v. 

### Cent. Heating & 

### Plumbing Co., 81 Wn.2d 528, 530, 503 P.2d 108 (1972). We review the denial ofsuch a motion de
novo. 

### Schmidt v. Coogan, 162 Wn.2d 488,491, 173 P.3d 273 (2007), 

### aff'd, 181 Wn.2d 661, 335 P.3d 424 (2014). In Washington, the primary goal in interpreting a contract term is to ascertain the parties' intent at the time they executed the contract. 

### Paradise Orchards Gen. P 'ship v. Fearing, 122 Wn. App. 507, 516, 94 P.3d 372 (2004). And Washington cases hold that the intent ofthe parties to a particular agreement may be discovered not only from the actual language ofthe agreement, but also from "viewing the contract as a whole, the subject matter and objective ofthe contract, all the circumstances surrounding the making ofthe 22

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# I I 

## I 

# I I ! No. 32616-1-III 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
contract, the subsequent acts and conduct ofthe parties to the contract, and the reasonableness ofrespective interpretations advocated by the parties." 

### Scott Galvanizing, Inc. v. Nw. EnviroServices, Inc., 120 Wn.2d 573, 580-81, 844 P.2d 428 (1993) (quoting

### Bergv. Hudesman, 115 Wn.2d 657,667, 801 P.2d 222 (1990)). When interpretation ofa contract depends on the use ofextrinsic evidence and
more than one reasonable inference can be drawn from the extrinsic evidence, interpretationpresents a question offact, not law. 

### SASAmerica, Inc. v. lnada, 71 Wn. App. 261, 857 P.2d 1047 (1993); RESTATEMENT (SECOND) OF CONTRACTS§ 212(2) (1981). Before moving for the directed verdict, OMH had cross-examined Mr. Ames about the meaning ofthe limitation ofliability provision. In response to repeated questions, reflected overthree pages ofthe transcript, Mr. Ames consistently responded that he was not sure whatparagraph 15 ofthe nondisclosure agreement meant. In response to one ofthe last questions, "You don'thave any idea what that means?" Mr. Ames responded: I know that the overall agreement as expressed to me and best articulated to me to OMHProscreen was that I had protected information which I found necessary to protect, and that's why I asked them to sign the nondisclosure agreement with me priorto conducting business withthem to protect my interest. 2 RP (May 7, 2014) at 349.

23No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.
In closing argument, Lakoda's lawyerreminded thejury ofthe nondisclosure agreement's paragraph 8 with its reference to "otherremedies" and said: Well, those twoparagraphs have to be reconciled. It can't be interpreted so one doesn'thave any impact at all. Ifyou look at 15, the fair reading ofit is that it doesn't make the nondisclosure agreement meaningless. The fair reading ofit is that it's talking about consequential damages, incorrect [sic]C6l damages ofother business, notthe business under the nondisclosure agreement. Otherwise, the nondisclosure agreement wouldn't mean a hill ofbeans. RP (May 15, 2014) at 108-09. Evidence at trial supported several factors that could make contract interpretation
a question offact. There was paragraph 8's reference to Lakoda's "otherrights and remedies" (a contract is viewed "as a whole"). 3 RP (May 8, 2014) at 435. There was Lakoda's practice ofrequiring the contract at the very outset ofa relationship to protect itselffrom being cut out ofa manufacturing relationship (the subject matter and objective ofthe contract). There was the fact that Lakodarequired the contractup front in its dealings with OMH (all "the circumstances surrounding the making ofthe contract"). CP at 1011. There was the fact that OMH was asserting its own breach ofcontractclaim ("the subsequent acts and conduct ofthe parties"). CP at 300. There was Mr. Ames's testimony that he did notknow whatparagraph 15 meant.

6 Presumably "indirect." 24No. 32616-1-111 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
As to the reasonableness ofthe parties' respective interpretations, Lakoda's contention thatparagraph 15 was intended to exclude only indirect and consequential harm to the nonbreachingparty's relationships with third parties is notunreasonable. The limitation looks like one more likely to be found in contracts Lakodawould use for sales ofgoods. 

### CfRCW 62A.2-719(1) (permitting limitation ofdamages in Article 2 sales to, e.g., return ofgoods and repayment ofthe price to repair and replace nonconforming goods); U.C.C. § 2-719 cmt. 1("However, it is ofthe very essence ofa sales contractthat at least minimum adequate remedies be available."). Ifthe intent was to limit only these attenuated damages, the provision couldhave been more clearly written, to be sure. But OMH's interpretation-thatthe parties intended to foreclose all remedies otherthan injunctive relief-fails under every nontextual factor we apply in interpreting contracts. Over 25 years ago, our Supreme Court disapproved the "plain meaning rule['s]" application to contract interpretation and adopted the contextrule. 

### Berg, 115 Wn.2d at 671. Under the context rule, the interpretation ofthe parties' nondisclosure agreement

25

### No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc. 

### presented a question offact, not law.7, 8 

### IV. Denial ofjudgment as a matter oflaw: trade secret misappropriation OMH also chal~enges the trial court's denial ofits CR50 motion to dismiss Lakoda's trade secret misappropriation claim. It 

### contends Lakoda had not presented sufficient evidence ofa trade secret or, ifa trade secret existed, that it was Lakoda's

### trade secret. Again, we review de novo whether Lakoda's evidence was insufficientto support
a verdict in its favor. Washington law provides remedies to parties harmed by misappropriation oftheir trade secrets. RCW 19.108.020-050. Lakoda's position was that its contacts in China, the factories it had identified and developed working relationships with, and its knowledge ofmethods for working with factories and manufacturers in China were its trade secrets.

7 

### In its reply brief, OMH argues the contract should have been construed against Lakoda. The principle that a contract may be construed againstthe drafter applies only if the contextrule has been applied and the contract still remains ambiguous. ForestMktg. Enters. Inc. v. Dep'tNat. Res., 

### 125 Wn. App. 126, 132-33, 104 P.3d 40 (2005) (citing Roberts, Jackson &Assoc. v. Pier 66 Corp., 

### 41 Wn. App. 64, 69, 702 P.2d 137 (1985)). 

### It is apossible matter ofinstruction to thejury, but since it applies to only ambiguous contracts it 

### has no application where we are being asked following ajurytrial to decide that the contract had a clear meaning as a matter oflaw. 8 

### On appeal, Lakoda also argues that even ifthe interpretationproposed by OMH is correct, it would not matter because a limitation on liability is excused when the breachingparty acted in bad faith. Thejurywas not asked to determine whether OMH breached the contract in bad faith, however, and we do not view its finding ofa willful and malicious trade secret violation as a substitute for instruction and finding on a distinct contract issue. 26No. 32616-1-III 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
Lakodapresented testimony that it would be difficult for someone to work with a factory in China ifthey had not done so before, and testimony explaining why. Mr. Ames testified to the tremendous amount oftime Lakoda spent locating and investigating factories. Lakodapresented evidence that Mr. Ames visited the Longfei factory a number oftimes in orderto assess, among otherthings, what equipmentwas available, whatthe manufacturing process was, what quality checks were in place, and what communication barriers might exist. Mr. Ames testified he had worked with Longfei for years. Evidence was presented that OMH had encountered problems with its prior manufacturing relationship in China and, notwithstanding OMH's contention that Chinese factories could be searched for on the Internet, it had elected to find its next manufacturer with the assistance ofLakoda and signed a nondisclosure agreement in orderto do so. Because the evidence established that Lakoda often worked with and through Peter and TPD, OMH argues, "Ifthe Longfei factory was a trade secret, it was TPD's trade secret." Br. ofAppellant at 41. But it cites no legal authority that working through agents prevents a person from having trade secrets. The Uniform Trade Secrets Act defines "trade secret" as information, including a formula, pattern, compilation, program, device, method, technique, orprocess that: (a) Derives independent economic value, actual orpotential, from notbeing generally known to, and notbeingreadily ascertainable by 27No. 32616-1-III 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
proper means by, otherpersons who can obtain economic value from its disclosure oruse; and (b) Is the subject ofefforts that are reasonable underthe circumstances to maintain its secrecy. RCW 19.108.010(4). The definition does not exclude information obtainedthrough agents. The evidence presented by Lakodawas sufficientto support ajuryverdict that the Longfei factory and methods ofworking with it was Lakoda's trade secret. V. Sufficiency ofevidence on damages OMH challenges the damage award, alleging thejury's award is not supported by "sufficient and accurate" evidence. Br. ofAppellant at 30. Lakodapresented its evidence on damages through Mr. Ames. He first identified
an exhibitthat was a collection ofinvoices from Lakodato OMH and an exhibit that was
a collection ofpurchase orders Lakodahad placedwith TPD. He testified that the collections ofinvoices and purchase orders would reflect, respectively, all ofLakoda's costs ofgoods soldto OMH and all ofLakoda'srevenue received from OMH, with the difference being Lakoda's gross profit. He also identified exhibits thathad been prepared to summarize information from the invoices and purchase orders that was relevant to Lakoda's calculation ofits damages. Lakoda offered the summaries underER 1006. OMH objected to the first summary offered, Exhibit 16, onthe basis that one type ofentry was an "average unitprice" rather than a figure actually reflected on the underlying documents. 1 RP (May 6, 2014) at 112. The trial court overruledthe 28No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc. objection and the summary was admitted into evidence. When other summaries that were
even more key to Lakoda's damage claim were offered thereafter, OMH indicated that they were "subjectto the same objection." See 1RP (May 6, 2014) at 140-42 (offer and admission ofEx. 126). OMH now challenges the trial court's ruling admitting several ofthe summaries, arguing they were not accurate. ER 1006 provides that "[t]he contents ofvoluminous writings, recordings, or photographs which cannot conveniently be examined in court may be presented inthe form ofa chart, summary, or calculation." The rule requires that the summary and the originals be made available at a reasonable time andplace. No challenge was made at trial to Lakoda's representation that its summaries and underlying documents were made available to OMH before trial. Relying on case law holdingthat the proponent ofa summary offered underER 1006 must showthat it is "accurate," OMH identifies three alleged errors in the summaries. But only one ofthe alleged errors was raised as an objection whenthe summaries were offered. That objection was to the inclusion ofan average unit price in exhibit 16. While the average unit price did not itselfappear onthe summarized documents, it was derived from them, and its correctness or incorrectness could be determined from them. It fell within the rule's authorization topresentthe contents of voluminous documents "inthe form ofa ... calculation." 29

### No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc.


### OMH's other objections come too late. 9 

### Lakoda laid the required foundation of accuracy. See 

### 1RP (May 6, 2014) at 111-12, 142 ("Q. 

### Is this an accurate summary of the information contained in Exhibit 18? A. Yes."; "Q. 

### Do you believe that this is an accurate summarization ofthe information contained within Exhibit 128? A. Yes, I do."). The foundation requirement is not a guarantee ofaccuracy. See FidelityNat. Title Ins. Co. v. IntercountyNat. Title Ins. Co., 

### 412 F.3d 745, 753 (7th Cir. 2005) ("[T]he fact that [summaries] might

### be inaccurate is not a ground for excluding them.") The reason the rule requires advance production ofthe summarized documents is so that an adversary can spot checkthe summary for accuracy and, should itreveal inaccuracies, "have solid grounds for moving to exclude [the summary] from the trial unless the inaccuracies were promptly corrected." Id. 

### OMH's identification for the first time on appeal ofasserted errors in the summaries admitted into evidence is no basis for setting aside the damages awarded. "A strong presumption exists in Washington that ajury's determination ofthe amount of damages to be awarded is valid." Palmer v. Jensen, 

### 81 Wn. App. 148, 150, 913 P.2d 413 (1996). An appellate court will generally not disturb ajury'sverdict on damages ifthe verdict is within the range ofthe evidence presented at trial. Steele v. Queen CityBroad.

9 

### They also depend on exhibits 126 and 128, neither ofwhich was designated as part ofthe record on appeal. 30No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc. Co., 54 Wn.2d 402,409, 341 P.2d 499 (1959). OMHpresents no basis for disturbing this verdict. VI. Attorney fees Finally, OMH challenges the trial court's award ofattorney fees to Lakoda. It argues the court abused its discretion when it awarded fees because: (1) Lakoda only recovered a nominal award onthe trade secret claim, (2) the award did not segregate time spent on claims for which Lakodawas not entitled to recover fees, and, (3) the final award included hours spentto recover fees and the costs ofa courtreporter at Mr. Hilmoe's depositions. Lakodawas awarded reasonable attorney fees underRCW 19.108.040, which provides that "[i]f
... willful and malicious misappropriation exists, the court may award reasonable attorney's fees to the prevailing party." "This court reviews the reasonableness ofattorney fees awards under an abuse of discretion standard." Brand

### v. Dep 'tof Labor &Indus., 139 Wn.2d 659, 665, 989 P.2d 1111 (1999). A trial court abuses its discretion ifits award is manifestly unreasonable or based onuntenable grounds. Id. "The trial court's discretion is notunbridled" and the Washington State Supreme Court has overturned attorneys fee awards when it "disapproved ofthe method utilized by the trial court" to calculate an award. Progressive Animal Welfare Soc. 

### v. Univ. ofWash., 114 Wn.2d 677, 689, 790 P.2d 604 (1990).

31

### No. 32616-1-111 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
A. "Nominal" award OMH first argues that because Lakoda was only awarded nominal damages on its trade secret claim, the court abused its discretion when it awarded Lakoda fees and costs in the amount of$231,441.78. It cites 

### Farrar v. Hobby, in which the United States Supreme Court held that in a civil rights case, a prevailing party who receives an award ofnominal damages may notbe entitled to a recovery offees and costs. 506 U.S. 103, 111-12, 113 S. Ct. 566, 121 L. Ed. 2d 494 (1992); 

### see also Sintra, Inc. v. City of Seattle, 131 Wn.2d 640, 664-65, 935 P.2d 555 (1997). Still, 

### "Farrar does not set forth aper se rule that attorney's fees are improper when only nominal damages are obtained." 

### Ermine
v. City of Spokane, 143 Wn.2d 636, 644, 23 P.3d 492 (2001). Andthis is not a Section 1983 case. Mostpersuasive to us is the overlapping nature ofthe claims and the implausibility that thejurybelieved Lakoda suffered only $1 in damages from trade secret misappropriation. Thejurors were instructed thatLakoda had the burden on its trade secret claim ofproving "[t]hatDefendants' misappropriation was a proximate cause ofdamages to Lakoda, Inc., or as a result ofthe misappropriation Defendants received money or benefits that injustice and fairness belong to Lakoda, Inc." CP at 1026. In completing the special verdict, thejury not only found misappropriation, it separately found that the misappropriation was willful and malicious. OMHpoints us to no

32No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.
evidence presented during the trial that would explain $1.00 in damages resulting from the misappropriation. We agree with the trial courtthat it appears thejurorswere heeding the court's instruction that they "shouldnot duplicate the damages in your award." CP at 1059; cf Reazin v. Blue Cross & Blue Shieldof Kansas, Inc., 663 F. Supp. 1360, 1430 (D. Kan. 1987), (rejecting defense argument that a punitive damage award could not stand where jurors awarded only $1.00 in damages for the underlying claim; "[ v]iewing all the facts ofthis case and thejury instructions in their entirety, the verdict can only be understood
as thejury's conclusion [thatplaintiff] suffered in excess ofone and a halfmillion dollars ofdamages as a direct consequence ofdefendant's conductviolating both the antitrust laws ofthe United States and the tort law ofthe State ofKansas."), aff'd inpart, 899 F.2d 951 (10th Cir. 1990). We doubt thejury viewed Lakoda's damage from the trade secret misappropriation
as nominal and even ifit did, the trial courtwould have discretion to award the fees. Ermine, 143 Wn.2d at 650 (emphasizing the deferential abuse ofdiscretion standard applied in reviewing a court's decision to grant or deny attorney fees in a nominal damages case). We find no abuse ofdiscretion. B. Segregation OMH next argues the trial court abused its discretion because it did not segregate

33

### No. 32616-1-111 

### Lakoda, Inc. v. OMHProscreen USA, Inc.
the time Lakoda spent on the breach ofcontract claim or OMH's counterclaims from the misappropriation claim. To calculate an attorney fee award, a court multiplies the number ofhours reasonably expended by the reasonable hourly rate. 

### Chuong Van Pham v. Seattle City Light, 159 Wn.2d 527, 538, 151 P.3d 976 (2007). The court should discount hours spent
on unsuccessful claims, duplicated or wasted effort, or otherwise unproductive time. 

### Bowers v. Transamerica Title Ins. Co., 100 Wn.2d 581, 597, 675 P.2d 193 (1983). "[H]ours reasonably expended must be spent on claims having a 'common core offacts and related legal theories,'" to those for which the party is entitled to recover. 

### Chuong Van Pham, 159 Wn.2d at 538 (quoting

### Martinez v. City of Tacoma, 81 Wn. App. 228, 242-43, 914 P.2d 86 (1996)). Lakoda's lawyers provided its billing statements to the court and a representation ofthe amount they believed reflected efforts enabling them to prevail on the trade secret claim. They acknowledged the workrelated to other claims, but all involved a common
core offact and were not easily segregated. They reduced the fees by 14 percent, an amount they believed was a reasonable adjustment for duplicate billing. The court found that the claims were "intertwined," and explained that after going through the supporting billing information it believed the 14 percentreduction was fair. RP (June 27, 2014) at 20-21.

34

### No. 32616-1-III Lakoda, Inc. v. OMHProscreen USA, Inc.

Id. 

### There may be some overlapping. As I wentthrough and looked at those, I was trying to figure out how to tally and calculate them. Mr. Roberts agreed he would take a percentage offeven whathe figured to make sure that it stays fair. To the Court, that seems like a very reasonable way.

This is a case in which there was a substantial overlap ofconduct relevant to each ofLakoda's claims. And because ofOMH's "financial interest" defense to trade secret misappropriation, the disputes offact over OMH's own situation and course ofaction became relevant to prevailing on the trade secret claim. The trial court considered the overlap and was in the bestposition to assess and account for it. OMH has not provided
us with any basis for finding the 14 percent discount manifestly unreasonable. C. 

### Fees-on-feefights anddeposition costs 

### Finally, OMH argues the court abused its discretion when it awarded Lakoda fees for the time spent arguing the attorney fees motion and courtreporter costs for Mr. Hilmoe's deposition. Ofthe $231,441 awarded in fees, $8,600 were incurred arguing the fee motion. OMH does not identify the amount ofcosts associated with the depositions ofMr. Hilmoe. "As a general rule, fees incurred while litigating an entitlementto fees are recoverable under remedial statutes." Johnson v. Dep 't of Transp., 

### 177 Wn. App. 684, 695 n.7, 313 P.3d 1197 (2013) (citing FisherProps., Inc. v. Arden-Mayfair, Inc., 

### 115 Wn.2d 364,378, 798 P.2d 799 (1990)). OMH nonetheless complains that Lakoda waited 35No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc.
until it filed its reply briefon the fee motion to raise its request for fees incurred in seeking fees. OMH hadthe opportunity to voice its objections to the additional fees whenthe motion on the fee award was heard, however, and does not claim to have requested andbeen denied a continuance. The trial court did not abuse its discretion in awarding fees based on the supplemental request. As to deposition costs, the trial court awarded the entire cost ofthe court reporter in attendance at Mr. Hilmoe's several depositions. With the benefit ofa transcript oftrial at this point, OMH contends only three pages ofthe Hilmoe deposition were used at trial. Itcounts only pages 566, 573, and 574 ofthe Report ofProceedings (5 RP (May 8, 2014)), on which Mr. Hilmoe is impeachedwith his deposition. Itis obvious from the transcript, however, thatLakoda's lawyerused the depositions to keep 

### Mr. Hilmoe on a short leash throughouthis cross-examination. Impeachment only happened when Mr. Hilmoe strayed. Atthe time it ruled on the fee award, the trial court did not have the trial transcript, but only Lakoda's lawyers' recollection thatthe depositions were used extensively, OMH's lawyers' recollectionthat they were notused extensively, and its own recollection. Itentered a finding that "[d]uring trial, the depositions sought as costs were used extensively." CP at 1171. Under RCW 4.84.010(7), a party may recover a reasonable expense for the transcription ofdepositions used at trial "[t]othe extentthat the court ... finds that it was 36No. 32616-1-111 Lakoda, Inc. v. OMHProscreen USA, Inc.
necessary to achieve the successful result
... PROVIDED, That the expenses of depositions shall be allowed on a proratabasis for those portions ofthe depositions introduced into evidence orused for purposes ofimpeachment." In otherwords, a cost award for portions ofa deposition used for impeachment is a floor, belowwhich the court may not go. It is not a cap. Cases have upheld an award ofthe costs ofdepositions where they are used at trial "during cross-examinationandfor impeachmentpurposes," and evenwhere they are successfully used inprocuring a summaryjudgment. Payne v. Paugh, 190 Wn. App. 383,414, 360 P.3d 39 (2015) (emphasis added). The court did not abuse its discretion in awardingthe depositions' cost. Attorney fees on appeal Lakoda seeks an award ofits reasonable attorney fees and costs on appeal under RCW 19.108.040 and RAP 18.1. As the prevailing party, Lakodahas the right to recover reasonable fees and costs incurred-in this appeal that are associated with its trade secret claim. They are awarded subjectto Lakoda's compliance with RAP 18.l(d). Affirmed. A majority ofthe panel has determined this opinionwill not be printed inthe

37No. 32616-1-111 Lakoda, Inc. 

### v. OMHProscreen USA, Inc. Washington Appellate Reports, butit will be filed for public recordpursuantto RCW 2.06.040.

WE CONCUR:

mo, 

### J. 

# f' Fearing, CJ.



### 38