Opinion ID: 2780822
Heading Depth: 2
Heading Rank: 3

Heading: Declining to award attorneys’ fees as to Jem and

Text: Freeze Plaintiffs claim that the district court abused its discretion by determining the case “exceptional . . . as to each Defendant” but then failing to assess attorneys’ fees against Jem and Freeze. However, the plain language of the statute allows the court to choose whether to award fees, even after finding the case exceptional. See 15 U.S.C. § 1117(a) (“The court in exceptional cases may award . . . fees .”). The fact that “in exceptional cases” precedes “may” means that the case must be exceptional for attorneys’s fees to be awarded, but in an exceptional case, the district court “may” (or may not) award fees. Plaintiffs also argue that the district court’s decision that the evidence of willfulness was sufficient to support the jury’s finding and the court’s statement that the evidence of Jem’s willfulness was weak were in conflict. Plaintiffs are wrong, because the sufficiency of the evidence standard is lower than the standard for showing a case is exceptional. See Harper, 533 F.3d at 1021. Thus, the court consistently concluded that evidence of Jem’s willfulness was sufficient, yet too weak to merit an award of attorneys’ fees as to Jem and Freeze. Plaintiffs seemingly claim that the district court’s decision to not grant fees as to Jem and Freeze was illogical or inconsistent with its decision to grant fees as to A.V.E.L.A. Defendants. Plaintiffs claim that some of the bases on which the district court relied to deny fees as to Jem and Freeze also existed with respect to A.V.E.L.A. Defendants (prevailing on “one Lanham Act claim,” other monetary awards serve different purposes than an award of attorneys’ fees). FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. 37 However, the mere fact that the district court, after weighting the various considerations, awarded fees as to the A.V.E.L.A. Defendants does not demonstrate that the district court was required to award fees as to the other Defendants. On balance, the weightier evidence of A.V.E.L.A. Defendants’ willfulness justified an award of fees. Moreover, the district court pointed out that the evidence that Jem and Freeze caused actual damages was comparatively weak. Plaintiffs’ argument that the district court should not have relied on the award of profits to deny fees as to Jem and Freeze has some merit. A monetary award should support the decision to assess fees. See TrafficSchool.com, Inc., 653 F.3d at 832. However, the district court discussed the weight of the evidence of willfulness and actual damages at length and only mentioned profits briefly, apparently considering the underlying actions of the parties to be the main reason to deny fees as to Jem and Freeze. Consequently, the district court did not abuse its discretion in denying attorneys’ fees as to Jem and Freeze. IV. The district court did not err in granting summary judgment for Defendants on Plaintiffs’ Nevada right of publicity claim. The district court granted summary judgment in Defendants’ favor on the basis that Plaintiffs knew of a thirdparty’s unauthorized commercial use of Marley’s publicity right more than six months before Plaintiffs registered this right with the Nevada Secretary of State. We review the district court’s interpretation of a state statute de novo. Wetzel v. Lou Ehlers Cadillac Group Long Term Disability Ins. Program, 222 F.3d 643, 646 (9th Cir. 2000). 38 FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. Nevada law establishes “a right of publicity in the name, voice, signature, photograph or likeness of every person,” which lasts 50 years after the person’s death. Nev. Rev. Stat. § 597.790.1. “Any commercial use by another of the name, voice, signature, photograph or likeness of a person requires the written consent of that person or his or her successor in interest,” id. § 597.790.2, unless the person whose right of publicity is at issue dies and has no successors in interest. Id. § 597.800.2.10 The right of publicity “is freely transferable.” Id. § 597.800.1. “A successor in interest . . . of a deceased person may file in the Office of the Secretary of State . . . a verified application for registration of his or her claim.” Id. § 597.800.3 (emphasis added). “A successor in interest . . . of a deceased person may not assert any right against any unauthorized commercial use of the deceased person’s name, voice, signature, photograph or likeness that begins before the filing of an application to register his or her claim.” Id. § 597.800.4. A person, firm or corporation seeking to use the name, voice, signature, photograph or likeness of a deceased person for commercial purposes must first make a reasonable effort, in good faith, to discover the identity of any person who qualifies as a successor in interest to the deceased person. A person claiming to be a successor in interest to a deceased person must, within 6 months after the date he or she 10 There are also exceptions to the requirement of written consent for certain types of commercial use, see § 597.790.2, but those are not at issue here. FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. 39 becomes aware or should reasonably have become aware of an unauthorized commercial use of the deceased person’s name, voice, signature, photograph or likeness, register a claim with the Secretary of State pursuant to subsection 3. Failure to register shall be deemed a waiver of any right of publicity. Id. § 597.800.5 (emphasis added). The district court relied on this last sentence to hold that Plaintiffs had waived Marley’s publicity rights as against any defendant for any unauthorized use. Plaintiffs became aware of the unauthorized use of Marley’s publicity rights by someone other than Defendants, and Plaintiffs failed to register their claim within the next six months. Plaintiffs argue that the district court erred in its interpretation of the statute, because the six-month registration requirement applies with respect to each unauthorized use, and Plaintiffs registered their rights either before or within six months after learning of Defendants’ unauthorized use. There is no Nevada case law interpreting this registration timeliness requirement. Thus, we must seek to “predict how the [Nevada] high court would resolve” the matter. Giles v. Gen. Motors Acceptance Corp., 494 F.3d 865, 872 (9th Cir. 2007). Accordingly, we must construe the statute to give effect to the legislature’s intent, beginning with the plain statutory text, and giving effect to any unambiguous language. Richardson Constr., Inc. v. Clark Cnty. Sch. Dist., 156 P.3d 21, 23 (Nev. 2007). If the statutory language is ambiguous, the panel should “examine the statute in the context of the entire statutory scheme, reason, and public policy to effect a construction that reflects the Legislature’s intent.” Id. 40 FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. Beginning with the text at issue, “[f]ailure to register shall be deemed a waiver of any right of publicity” is unambiguous. See Nev. Rev. Stat. § 597.800.5. “[A]ny right of publicity” indicates that the forfeiture is broad, not limited to the particular unauthorized use a plaintiff became aware of six months or more before. Even assuming ambiguity, the context, reason, and public policy align with the district court’s interpretation. Section 597.800.3 provides for permissive registration without reference to the successor in interest’s knowledge of any unauthorized use. The successor in interest may only enforce its rights with respect to unauthorized use that occurred after registration. Id. § 597.800.4. However, upon learning of an unauthorized use, registration becomes mandatory. See id. § 597.800.5. Thus, the permissive and mandatory descriptions are in harmony, as they apply to different situations. Read together, they encourage successors in interest to register sooner rather than later. Plaintiffs argue that the legislature only intended to create a system to perfect successor rights in § 597.800.3 through .5. If this were so, the difference in language would not make sense. Section 597.800.4 penalizes failure to register by not allowing the successor to “assert any right” against unauthorized use that occurred prior to registration. In contrast, § 597.800.5 penalizes failure to register by deeming a “waiver of any right” of publicity. If the legislature meant that the successor merely could not assert its right (but still retains it), it seems the legislature would have used language parallel to that in § 597.800.4. Moreover, § 597.800.5 refers to any “right of publicity,” implying the right itself, not the right to assert claims based on the right of publicity. FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. 41 Plaintiffs also argue that the purpose of the statute is to bestow rights, not forfeit them. Of course this is broadly true. However, the legislature apparently intended to limit a successor’s right. The successor’s right extinguishes 50 years after the person’s death. Id. § 597.790.1. Also, living persons enforcing their own rights to publicity do not ever have to register their rights. See id. § 597.790–.800. Thus, the sixmonth registration requirement is in line with the qualified nature of rights allowed successors under the statute. V. There was sufficient evidence to support the jury’s verdict on the interference claim. Liability for the tort of intentional interference with prospective economic advantage requires proof of the following elements: (1) a prospective contractual relationship between the plaintiff and a third party; (2) knowledge by the defendant of the prospective relationship; (3) intent to harm the plaintiff by preventing the relationship; (4) the absence of privilege or justification by the defendant; and (5) actual harm to the plaintiff as a result of the defendant’s conduct. Wichinsky v. Mosa, 847 P.2d 727, 729–30 (Nev. 1993). With respect to Plaintiffs’ prospective relationship with Walmart, A.V.E.L.A. Defendants claim there was insufficient evidence to support the fifth element—whether Plaintiffs 42 FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. were harmed as a result of A.V.E.L.A. Defendants’ conduct.11 At trial, Doreen Crujeiras, a licensing agent for Hope Road, testified to the following: Hybrid was an apparel manufacturer and one of Hope Road’s Marley merchandise licensees that generally sold apparel at K-Mart, Target, and Walmart. Hybrid “lost” an order “intended for Walmart.” Jem, a licensee of A.V.E.L.A., “got the order instead.” This order was “100,000 units of T-shirts and 100,000 units of hoodies.” The gross sales would have been “like 1.8 million dollar[s],” and Hope Road’s royalty on those sales would have been “about $250,000.” A.V.E.L.A. Defendants do not assert that they offered evidence contradicting Crujeiras’s testimony on this point. Rather, they argue that they impeached Crujeiras’s testimony. Crujeiras admitted she could not remember “exactly who told [her]” about the lost order. Also, defense counsel asked Crujeiras, “[Y]ou don’t have any knowledge that A.V.E.L.A. or anybody from the defendants went in and undercut Hybrid’s efforts to sell to Walmart[?]” Crujeiras answered, “Well, I did have that one conversation with the owner of Hybrid. It was a conference call that I participated on. And he was very upset and he did say that, you know, it was a problem for him.” Crujeiras’s cryptic answer could give rise to an inference that she had no basis for believing Defendants were responsible for the lost order, and that she actively avoided admitting that. However, her answer could also be understood to mean that A.V.E.L.A. Defendants’ interference was the “problem” to which the owner of Hybrid referred. 11 In their opening brief, A.V.E.L.A. Defendants only challenged sufficiency of the evidence as to Walmart on this basis. Thus, claims of insufficient evidence based on other elements of the tort are waived. See Kim v. Kang, 154 F.3d 996, 1000 (9th Cir. 1998). FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. 43 Without more, this vague answer on cross-examination does not establish that Crujeiras’s uncontradicted testimony was “sheer surmise and conjecture,” as A.V.E.L.A. Defendants claim, because the evidence must be “construed in the light most favorable to [Plaintiffs].” See Harper, 533 F.3d at 1021. A.V.E.L.A. Defendants also argue that Crujeiras’s testimony was biased. This argument fails, because we may not assess the credibility of witnesses in determining whether sufficient evidence exists. See id. A.V.E.L.A. Defendants cite no authority for their argument that Hope Road needed to state the exact amount of lost royalties in order for its evidence that Hope Road was actually damaged to be sufficient. Moreover, providing sufficient evidence that Hope Road lost royalties from a prospective deal, no matter how much the loss equaled, would satisfy this inquiry. The amount of the loss is necessary for damage calculation, not proving Hope Road was “actual[ly] harm[ed].” See Wichinsky, 847 P.2d at 730. The evidence was sufficient to support the challenged element of actual harm.12 VI. The district court did not err in granting Defendants’ motion for judgment as a matter of law on the issue of punitive damages. We review de novo the district court’s order granting a motion for judgment as a matter of law. Saman v. Robbins, 173 F.3d 1150, 1155 (9th Cir. 1999). Defendants moved for 12 Because there was sufficient evidence with respect to the prospective business relationship with Walmart, we need not reach A.V.E.L.A. Defendants’ other arguments regarding Wet Seal, JGR Copa, Target, and Ecko. The interference claim only requires an expectancy of a single business relationship. See Wichinsky, 847 P.2d at 729–30. 44 FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. judgment as a matter of law at trial. The district court granted the motion as to Plaintiffs’ claim for punitive damages and denied as to Plaintiffs’ claim for intentional interference with a prospective business relationship. Plaintiffs first argue that this decision was inconsistent, because both claims relied on the same evidence of Defendants’ intent. Punitive damages require a showing by clear and convincing evidence that Defendants acted with “oppression, fraud or malice, express or implied.” Nev. Rev. Stat. § 42.005.1. “Malice, express or implied” is defined as “conduct which is intended to injure a person or despicable conduct which is engaged in with a conscious disregard of the rights or safety of others.” Id. § 42.001. The intentional interference claim requires a plaintiff to prove that the defendant “inten[ded] to harm the plaintiff by preventing the relationship.” Wichinsky, 847 P.2d at 729–30. However, the burden of proof for an intentional interference claim is preponderance, not clear and convincing. See Holliday v. McMullen, 756 P.2d 1179, 1180 (Nev. 1988) (per curiam). In a case analyzing intentional interference with a prospective business relationship, the Nevada Supreme Court held that “[t]ort liability alone is insufficient to support an award of punitive damages.” Wichinsky, 847 P.2d at 730. Thus, the district court’s decisions were not inconsistent. We also reject Plaintiff’s second argument—that the district court found there was sufficient evidence to instruct the jury on punitive damages before granting judgment as a matter of law to Defendants on the same issue. Plaintiffs are simply wrong in their construction of the trial transcript, which reveals that the district court did not find that there was sufficient evidence to instruct the jury on punitive damages. Instead, the district court merely expressed its current FIFTY-SIX HOPE ROAD MUSIC V. A.V.E.L.A. 45 thoughts on the matter, stating that “at this stage” “I think the jury should be instructed on punitive [damages].” Due to the inconclusive nature of the statement, there was no conflict.13