Court Opinion

ID: 1031262
Source: CourtListenerOpinion
Date Created: 2013-07-05 08:28:43.925119+00
Date Added: 2024-06-11T12:05:26.911658
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                             No. 08-2106

WESTERN INSULATION, LP,

                Plaintiff - Appellee,

           v.

HAL MOORE; MELANIE MOORE,

                Defendants - Appellants.

Appeal from the United States District Court for the Eastern
District of Virginia, at Richmond.   James R. Spencer, Chief
District Judge. (3:05-cv-00602-JRS)

Argued:   December 4, 2009                 Decided:   January 22, 2010

Before NIEMEYER, MICHAEL, and GREGORY, Circuit Judges.

Affirmed by unpublished opinion.       Judge Gregory wrote the
opinion, in which Judge Michael joined. Judge Niemeyer wrote a
separate opinion concurring in part and dissenting in part.

ARGUED: John B. Simpson, MARTIN & RAYNOR, PC, Charlottesville,
Virginia,   for  Appellants.     Paul   James  Kennedy, LITTLER
MENDELSON, Washington, D.C., for Appellee. ON BRIEF: Ronald S.
Sofen, GIBBS, GIDEN, LOCHER, TURNER & SENET, LLP, Los Angeles,
California, for Appellants.       Stephen C. Tedesco, LITTLER
MENDELSON, PC, San Francisco, California; Kathleen A. Goetzl,
LITTLER MENDELSON, Washington, D.C., for Appellee.

Unpublished opinions are not binding precedent in this circuit.
GREGORY, Circuit Judge.

       After extensive litigation on liability and damages for the

defendants’ breach of their non-compete agreement concluded with

a finding against the defendants, Hal and Melanie Moore, the

District     Court       for   the     Eastern     District      of    Virginia      awarded

Western     Insulation,         L.P.    $218,705.90         in   attorneys’     fees       and

costs.      The district court found the award of attorneys’ fees

proper    because        the   non-compete        agreement      between      the    parties

mandated the receipt of fees for actions to enforce a breach of

its terms, and the court imposed the amount of fees it believed

to be proportional to the relief obtained in the case.                               Because

we   find     the       contractual      provision     awarding         attorneys’     fees

enforceable and the amount of fees awarded reasonable as to each

defendant, we affirm the district court’s order.

                                             I.

       We have previously discussed the factual background of the

breach in this case in our opinions in Western Insulation, L.P

v.   Moore,       No.    06-2028,      242   Fed.    App’x       112   (4th   Cir.    2007)

(reversing the district court’s award of damages and attorneys’

fees and holding that the imposition of an injunction would not

have   harmed       third      parties),     and    Western      Insulation,        L.P.    v.

Moore,      No.     08-1219,      316    Fed.       App’x    291       (4th   Cir.     2009)

(affirming the district court’s finding of nominal damages and

                                              2
imposition of an injunction as to Melanie Moore).                          Thus, here we

describe only the facts which have bearing on the award and

reasonableness of attorneys’ fees.

      In March 2001, Western, Inc. (“Western”) entered into an

agreement   with        Hal   Moore     (“Hal”)       to     purchase      his     company,

Western   Insulation,         for   over    $41      million.        As    part    of   that

agreement, Hal and his wife Melanie Moore (“Melanie”) entered

into an agreement not to compete with Western for a period of

seven years following the completion of the transaction.                                Hal

and   Melanie         did   not,    however,         abide    by   their      agreement.

Contrary to the specific provisions of the agreement, Hal hired

two former Western employees to work in his remaining business

ventures.       Additionally, Melanie acted as a surety for a $1.41

million line of credit to one of her former employees who formed

the company American Insulation, a competitor of Western.                               For

her guarantee of the loan, Melanie was given the right to buy up

to ninety percent of American Insulation for $9,000 at the end

of her non-compete period.              Melanie also signed a second surety

agreement       for     another      former     employee        who       formed     Empire

Insulation, also a competitor of Western.

      Because     of    these      breaches     of    the    non-compete         agreement,

Western filed suit, and at the conclusion of a three-day bench

trial,    the    district       court      found      that    both    defendants        had

breached their covenants not to compete, among other violations,

                                            3
and awarded $943,659 in damages and $361,660 in attorneys’ fees.

On appeal, however, we held that there was no basis for the

district court to award damages for the breaches because the

plaintiff had not shown any compensable harm.                      We thus vacated

the district court’s orders as to both damages and attorney’s

fees.      Western Insulation, 242 Fed. App’x at 125.                  However, this

Court did find that the plaintiff had established that Melanie

had breached her covenant not to compete and Hal had breached

his non-solicitation agreement, id. at 117-19, and the district

court   erred    in    denying     the    plaintiff      an    injunction      against

Melanie, id. at 124-25.

      On     remand,    the     plaintiff       requested      that,     instead     of

compensatory damages, the court impose a permanent injunction

against Melanie to prevent her from competing with Western and

award   nominal       damages    for     the    breaches      of   contract.       The

district court did so, finding a permanent injunction proper as

to   Melanie    and    awarding     $100       in   nominal    damages    from     each

defendant for the breaches of contract.                    This Court on appeal

affirmed the result in its entirety.                    Western Insulation, 316

Fed. App’x at 300.

      In a separate opinion, the district court again awarded

attorneys’ fees to the plaintiff:                   $165,414.83 from Melanie and

$41,606.46 from Hal.            The district court discussed each of the

twelve Kimbrell’s factors and determined that the award of a

                                           4
permanent injunction as to Melanie and the finding of a breach

of the contract by both parties entitled the plaintiff to some

of its attorneys’ fees.                 See Barber v. Kimbrell’s, Inc., 577

F.2d 216, 226 n.28 (4th Cir. 1978).                        Western claimed that it

spent       $584,380.28      in   attorneys’        fees   litigating       the    case    in

Virginia. 1         In calculating the lodestar amount of fees for the

case, the court broke the litigation fees down into the amount

spent       litigating     each   part    of       the   case:        trial,   appeal     and

remand.        Of    the     $348,365    spent       litigating       the   case   on     the

merits,       the    court    awarded    one       quarter       of   the   fees   against

Melanie, because it found half of the plaintiff’s goal had been

realized:       an award of damages against each defendant.                         Of the

$154,098 in fees spent to appeal the judgment to the Fourth

Circuit in the first instance, the court awarded half the fees,

split evenly between Hal and Melanie, because this Court had

ruled in favor of injunctive relief and found breaches of the

agreement.          Finally, of the $55,092.28 spent to litigate the

case on remand, the court again awarded half the fees, for which

only Melanie was responsible, because the plaintiff obtained the

remedy of a permanent injunction against Melanie and nominal

        1
       The district court earlier did not allow the plaintiff to
collect fees from the original action brought in California.
That case was voluntarily dismissed by the plaintiff and then
re-filed in Virginia to comply with a contractual provision
requiring that any action to enforce the agreement be brought in
Virginia.

                                               5
damages.        The   court   increased     the    lodestar      amount   by    eight

percent given the complexity of the case and arrived at the

total fee award of $270,021.29.                This timely appeal followed

concerning solely the award of attorneys’ fees.

                                       II.

     This Court reviews the district court’s decision to award

attorneys’       fees   under    an    abuse       of     discretion      standard.

McDonnell v. Miller Oil Co., 134 F.3d 638, 640 (4th Cir. 1998)

(citing Colonial Williamsburg Found. v. Kittinger Co., 38 F.3d

133, 138 (4th Cir. 1994)).            The Moores present two issues upon

appeal:    whether attorneys’ fees were lawfully awarded, and if

so whether the amount of fees was reasonable in light of the

relief achieved against each defendant.                   We address each issue

in turn.

                                       A.

     In the course of his briefing, Hal argued that there was no

basis    upon   which   the   court   could       award   fees    against      him   as

Western had only been awarded nominal damages from him. 2                   At oral

argument, however, counsel for the Moores stated they did not

contest the imposition of fees, only the reasonableness of the

     2
       Melanie did not contest the fact that attorneys’ fees
could be awarded against her, only the reasonableness of the
award.

                                        6
amount awarded.       Nevertheless, we briefly describe the basis for

awarding fees.

      Hal’s argument relies upon this Court’s decision in Mercer

v.   Duke   University,    401   F.3d   199    (4th   Cir.    2005),   and   the

Supreme Court’s ruling in Farrar v. Hobby, 506 U.S. 103 (1992).

Both of those cases held that when only nominal damages are

awarded, attorneys’ fees are not generally available.                  Mercer,

401 F.3d at 203 (quoting Farrar, 506 U.S. at 115).                 The Courts’

view in those cases was that when the plaintiff fails to prove

an   essential   element    of   damages—that      any   are   warranted—the

usual award is no fee at all.               Farrar, 506 U.S. at 115.         To

determine whether a nominal damages case is the exceptional case

meriting fees, the court must apply a three factor test.                First,

and most importantly, the court must compare the relief sought

and the relief obtained.         Mercer, 401 F.3d at 204.          Second, the

court evaluates the “significance of the legal issue on which

the plaintiff prevailed.”         Id. at 206 (quoting Farrar, 506 U.S.

at 122.)     Finally, the court determines whether the litigation

served a public purpose beyond the dispute between the parties.

Id. at 207.

      However,   as    argued    by   Western,   there   is    a   fundamental

difference between this case and Mercer and Farrar:                the source

of the right to attorneys’ fees.            In the two cases cited by Hal,

the plaintiff’s entitlement to fees was a result of 42 U.S.C.

                                        7
Section         1988,     which      gives     the    district          court    discretion          to

decide      whether       the     plaintiff      is       entitled      to     fees       in     certain

civil rights actions.                   In the language of Section 1988, the

district        court     “may     allow”      recovery          of    fees.         As    such,    any

recovery          of     fees     is    plainly           discretionary.                  This     Court

recognized in Mercer that the statute at hand merely made the

plaintiff eligible for, not entitled to fees.                                  401 F.3d at 203.

For this reason, the Moores’ reliance on Mercer in their brief

and at oral argument is misplaced.                           While it is true that the

search for reasonableness in a fee award writ large is similar

both       here    and    in    Mercer,      the      entitlement         to    fees        here    has

nothing to do with the congressional policy of awarding fees in

some civil rights actions.

       By contrast, the source of Western’s entitlement to fees in

this case is the agreement itself, which the Moores breached.

Paragraph Five of the Moores’ non-compete agreement with Western

provides        that     “in    any    action        in    law    or    in     equity       . . .     to

enforce      this       Agreement,       the    prevailing            party     in    such        action

shall      be     entitled      to     reasonable         attorneys’         fees,        costs,    and

necessary disbursements . . . .”                      J.A. 299 (emphasis added). 3                    As

this case is a diversity action based on state contract law, the

contract, including its provisions on attorneys’ fees, is to be

       3
       All citations to “J.A. __” refer to the Joint Appendix
provided by the parties in this case.

                                                 8
interpreted using state law.               The Virginia Supreme Court has

defined “prevailing party” for fees and costs purposes broadly

as the party in whose favor the judgment is entered in the case.

Richmond v. City of Henrico, 41 S.E.2d 35, 41 (Va. 1947).                       This

definition of prevailing party certainly includes the party for

whom   judgment     is    entered     in   the   form       of   nominal    damages.

Further, in Ulloa v. QSP, the Virginia Supreme Court held that

the trial court properly awarded attorneys’ fees to QSP for its

breach    of     contract    claim    against    Ulloa,       per   a   contractual

provision awarding fees, even though the jury, after finding

that Ulloa breached the contract, declined to award any damages

for the breach.           624 S.E.2d 43, 49 (Va. 2006).                 Noting that

“parties   are     free     to   draft   and   adopt    contractual        provisions

shifting the responsibility for attorneys’ fees to the losing

party in a contract dispute,” the court upheld the fee award for

the breach of contract claim.              Id. (citing Mullins v. Richlands

Nat’l Bank, 403 S.E.2d 334, 335 (Va. 1991)).

       This case therefore appears to be controlled by Virginia

law allowing the award of attorneys’ fees to a prevailing party,

broadly defined, when those fees are mandated by contractual

provision between the parties.                 There is no reason why this

provision in the contract should not be enforced against both

Melanie    and    Hal.      The    question    then    is    whether    those   fees

awarded were reasonable, an issue to which we now turn.

                                           9
                                                B.

       The central argument Hal and Melanie make upon appeal is

that even if the award of fees was proper, it was unreasonable.

Hal argues that requiring him to pay $41,606.46 in fees when

only       $100     in     nominal    damages        was     assessed     against    him     is

presumptively unreasonable.                    Melanie argues that the district

court       incorrectly           awarded      “virtually”         the    same    amount     of

attorneys’        fees      against      her    when       the    plaintiff      received    an

injunction and nominal damages as it did when the plaintiff had

received over a $1 million judgment. 4                            This is an error, she

argues,       because        the     district        court       incorrectly     valued     the

issuance       of     an     injunction        and    the     recovery     of    significant

compensatory damages as equally important to the plaintiff and

splitting the fees equally between claims was not proper.                                   For

the reasons enumerated below, we find both of these arguments

unavailing.

       In    reviewing        a    fee   award,       this       Court   gives   substantial

deference to the district court which tried the case because of

that court’s “intimate knowledge of the efforts expended and the

value of the services rendered.”                       Kimbrell’s, 577 F.2d at 226.

       4
       In its first opinion awarding fees in this case, the
district court did not mention how the fees were to be divided,
presumably because the fees were awarded after the court found
that the defendants violated the non-compete agreement jointly.
Melanie calculates her half of the fee award in the first
instance to be $186,672.29.

                                                10
Even if awarding fees is mandated by a contractual provision,

the   amount      awarded    must   still      be    reasonable.      Mullins,   403

S.E.2d at 335.         To determine the reasonableness of an award,

this Court has held that a district court must make “detailed

findings     of    fact     with    regard     to     the   factors   considered.”

Kimbrell’s, 577 F.2d at 226.                These factors must include “the

time consumed, the effort expended, the nature of the services

rendered,    and     other    attending      circumstances.” 5        Mullins,   403

S.E.2d at 335 (citing Beale v. King, 132 S.E.2d 476, 478 (Va.

1963)).      From    its     consideration      of    those   factors,   the   court

should determine how many hours were reasonably required for the

litigation     and    then    calculate      the     lodestar   amount   using    an

hourly rate.         Miller Oil, 134 F.3d at 640.               The lodestar rate

may then be adjusted for the particular factors and difficulties

of the case at hand.

      5
       The factors suggested by this Court for the district court
to consider are:    “(1) the time and labor expended; (2) the
novelty and difficulty of the questions raised; (3) the skill
required to properly perform the legal services rendered; (4)
the attorney’s opportunity costs in pressing the instant
litigation; (5) the customary fee for like work; (6) the
attorney’s expectations at the outset of the litigation; (7) the
time limitations imposed by the client or circumstances; (8) the
amount in controversy and the results obtained; (9) the
experience, reputation and ability of the attorney; (10) the
undesirability of the case within the legal community in which
the suit arose; (11) the nature and length of the professional
relationship between attorney and client; and (12) attorneys’
fees awards in similar cases.”      Kimbrell’s, 577 F.2d at 226
n.28.

                                          11
     The district court in this case explained its rationale for

awarding     fees        against     Hal    and       Melanie     at     great     length,

discussing each of the twelve factors enunciated by the court in

Kimbrell’s.       See supra n.5.             The most salient factor for the

district court was the complexity of the case given the number

of motions for summary judgment, extensive discovery litigation,

and bicoastal nature of the suit.                        Additionally, even though

Western    “obtained          only    one       meaningful       form    of     relief—an

injunction    against         Melanie,”      the      court   found      the    issues    so

intertwined that it was impossible to view the work done to

achieve    the    injunction         as    separable       from    the    rest     of    the

litigation.       J.A. 335.          The Supreme Court held in Hensley v.

Eckerhart, that when a suit involves several claims that have a

core of related facts, division of hours between claims can be

an   exercise       in    futility.             461   U.S.    424,      434-35     (1983).

Therefore, the “district court should focus on the significance

of the overall relief obtained by the plaintiff in relation to

the hours reasonably expended on the litigation.”                              Id. at 434.

Additionally,          this   Court       has     held    that     a    district        court

evaluating       the      degree     of     success      on      the    merits     between

successful       and     unsuccessful       claims       should    not    look     to    the

motives of the plaintiff as guidance, meaning the court should

not attempt to determine what the plaintiff would have thought

more important.          Mercer, 401 F.3d at 205.             The comparison should

                                             12
be with the relief “sought” not the relief “most important” to

the plaintiff.            Id. (emphasis added).             The court must therefore

view the entirety of the suit objectively.

       In    this       case,    the   plaintiff     sought      both    damages       and    an

injunction         in     his    original        complaint       against       the     Moores.

Concerning an injunction, the plaintiff sought three types of

preliminary and permanent injunction:                     to prevent further unfair

competition, contractual breaches, and misappropriation of trade

secrets.         Western also sought compensatory damages at the amount

proved      at     trial.        The     complaint   also,       of    course,       sought    a

finding of a breach in order to receive either remedy.

       At the conclusion of the liability and damages portion of

the     proceedings         before       the     district     court,         the     plaintiff

received nominal damages and an injunction.                            Though it was not

all the relief sought in the complaint, Western certainly was

the prevailing party under Virginia law.                      It cannot be said from

the face of the complaint or the remedy achieved, therefore,

that     injunctive             relief     was      not     an        important        remedy.

Additionally,           while    no    compensable    damages         were    awarded,       the

suit did result in a finding of liability.                            Valuing the damages

in unfair competition cases can be extremely difficult.                                      See

PADCO Advisors, Inc. v. Omdahl, 179 F. Supp. 2d 600, 612 (D. Md.

2002)       (“It    is    for     this     reason    that    courts       have       routinely

enforced covenants not to compete, as it is nearly impossible to

                                               13
quantify the amount of damage caused when former employees work

for    direct    competitors.       In   order      to   protect      an   employer’s

business interests, such as a loss of clients and good will,

covenants not to compete that require specific performance are

enforceable.”).         Thus, the achievement of a permanent injunction

in an unfair competition case is not negligible.                      In fact, it is

a significant result in that it enforces the original agreement

between the parties.

       Melanie attempts to turn precedent on its head by advancing

an    argument   which     evaluates     the    importance       of   each    kind   of

relief.      This is plainly erroneous where we have stated that the

relief is to be viewed objectively and where district courts

routinely grant permanent injunctions in non-competition cases.

Viewing       this      case     objectively,        the    plaintiff         achieved

significant relief.

       Given the relief achieved against each defendant, the court

then       calculated     the     lodestar     amount      for     each      defendant

individually.        As regards Hal, the court awarded one fourth of

the amount of fees Western incurred when appealing the case to

the    Fourth    Circuit,       $41,606.46     of   $154,098     after     the   eight

percent lodestar adjustment. 6           Hal was not responsible for any of

       6
       The eight percent adjustment occurred because the court
felt the lodestar amount should be increased slightly given the
length and complexity of the case.

                                         14
the fees for litigation before the district court at trial or on

remand.    The district court found the award of fees for the

litigation before the Fourth Circuit particularly proper because

this   Court   held    that   Hal   had    violated        his   agreement     not    to

compete, constituting a final judgment on the issue of Hal’s

breach.    We find it was not an abuse of discretion for the

district court to order Hal to pay one-quarter of the fees for

the appeal which found both Hal and Melanie at fault.                         The fact

that Hal was adjudged in violation of his non-compete agreement,

even though only nominal damages were awarded, made Western a

prevailing party against him and entitled the plaintiff to fees.

Thus, the district court was reasonable in awarding a select

portion of the fees to Hal when the fees concerned the part of

the litigation where his fault was determined.

       As regards Melanie, the district court ordered her to pay

one fourth of the fees incurred to try the case, one fourth

incurred to litigate the case before the Fourth Circuit, and one

half   incurred   to    litigate     the       case   on    remand,     a   total     of

$174,750.81 after the lodestar adjustment.                       The court’s logic

was that the plaintiff had achieved half of the relief sought at

trial (damages), half sought on appeal (injunction and finding

of breach), and half on remand (permanent injunction).                              This

division of fees was certainly not an abuse of discretion when

Western   achieved     substantial        relief,     though      not   all    of    the

                                          15
relief sought, such that an award of all fees was not proper.

In the aggregate, the fee award from Melanie cannot be said to

be excessive when the plaintiff spent $557,555.30 litigating the

case to a successful conclusion.     Therefore, the district court

did not err in the fee award from Melanie.

                              III.

     This Court therefore affirms the decision of the district

court below.

                                                          AFFIRMED

                               16
NIEMEYER, Circuit Judge, concurring in part and dissenting in
part:

     After nearly four years of litigation, both Hal Moore and

Melanie    Moore       were    found     to   have    breached       their    non-compete

agreements with Western Insulation, LP, and each was ordered to

pay $100 in nominal damages.                  In addition, Western obtained an

injunction against Melanie.

     Each       non-compete      agreement         provided    that    the    “prevailing

party”     in    an    action       to   enforce      it    “shall    be     entitled    to

reasonable attorneys’ fees,” and the district court ordered Hal

to   pay    $41,606.46         in    attorneys        fees     and    Melanie      to   pay

$165,414.83.          The court reasoned that Hal should pay one-fourth

of the fees that Western incurred during an earlier appeal to

our court and that Melanie should pay:                        one-fourth of the fees

that Western incurred to try the case; one-fourth of the fees

that Western incurred during the first appeal; and one-half of

the fees Western incurred on remand.                        The district court also

included in the amounts assessed against both Hal and Melanie an

8% enhancement because the case was “lengthy and complex.”

     The    majority          opinion    affirms      the     attorneys      fee   awards,

finding them to be reasonable.

     I concur in the majority’s opinion to the extent that it

affirms the base award (without the 8% enhancement) assessed

against Melanie.          But I conclude that the assessment of $41,606

                                              17
against Hal is excessive, given that Western recovered only $100

in   nominal   damages    from     him.        I    also      conclude     that    the   8%

enhancement is an abuse of discretion.                   Thus, I would reduce the

assessment against Melanie to $153,161.88, and I would vacate

the assessment against Hal and remand for the district court to

determine a reasonable amount of attorneys fees for Hal to pay

in light of Western’s limited victory against him.

       To begin, I agree with the majority that because Western’s

claim to attorneys fees stems from a contract that specified it

was to be interpreted and enforced in accordance with Virginia

law,   Virginia   law    governs     the       award     of    fees   in    this    case.

Additionally, I agree that under Virginia law, Western is the

“prevailing party” and is accordingly entitled to attorneys fees

from the Moores pursuant to the parties’ contract.                          But Western

is entitled to only reasonable attorneys fees.                        With respect to

the assessment against Hal, the question thus becomes what fee

is reasonable when the plaintiff’s only recovery was nominal

damages.

       The   Supreme     Court     has     addressed           this   issue,       noting

generally that “‘the most critical factor’ in determining the

reasonableness    of     a   fee    award          ‘is   the    degree      of    success

obtained.’”    Farrar v. Hobby, 506 U.S. 103, 114 (1992) (quoting

Hensley v. Eckerhart, 461 U.S. 424, 436 (1983)).                            Indeed, the

Court has specifically noted that “[w]hen a plaintiff recovers

                                          18
only     nominal       damages     because      of    his      failure        to     prove    an

essential element of his claim for monetary relief, the only

reasonable fee is usually no fee at all.”                       Id. at 115.           Although

these pronouncements of the Supreme Court came in the context of

reviewing       fees     awarded      pursuant       to   42    U.S.C.        §     1988,    the

principles        nonetheless         provide       guidance     here     and         strongly

suggest that it is unreasonable to order Hal, from whom the

plaintiff has only recovered nominal damages of $100, to pay

$41,606 in attorneys fees.

       Similarly, our precedents demonstrate that when a plaintiff

is entitled to reasonable attorneys fees, the district court

must account for the plaintiff’s limited success in calculating

the fee, “examin[ing] the size of the proposed attorney’s fee

. . .     award     in    comparison       with       the      total     damage           award.”

McDonnell v. Miller Oil Co., 134 F.3d 638, 641 (4th Cir. 1998)

(internal       quotation        marks    and       citation       omitted)          (vacating

district court’s award of nearly $20,000 in fees pursuant to a

mandatory fee-shifting statutory provision to a plaintiff who

otherwise recovered only nominal damages); see also Carroll v.

Wolpoff     &    Abramson,       53    F.3d        626,   629-31       (4th        Cir.    1995)

(affirming the district court’s award of $500 in attorneys fees

where plaintiff obtained only $50 in damages).

        Most importantly, the Supreme Court of Virginia has held

that a reasonable fee should reflect “the results obtained” by

                                              19
the prevailing party.           Chawla v. BurgerBusters, Inc., 499 S.E.2d

829, 833 (Va. 1998).            The majority opinion correctly describes

Ulloa v. QSP, Inc., 624 S.E.2d 43, 49 (Va. 2006), as holding

that a plaintiff who established that the defendant breached the

parties’ contract but who recovered no monetary damages for the

claim was nonetheless entitled to attorneys fees pursuant to a

contractual provision.               But the court in that case ultimately

reversed the trial court’s substantial award of attorneys fees

and   remanded     so    that    the       trial   court   could      reconsider      the

amount,   noting    that       the    plaintiff’s    degree      of   success    was    a

significant   consideration           in     evaluating    the   reasonableness        of

the   award   and       that    “the       results   obtained      by   QSP     in    its

litigation    against      Ulloa       can    be   characterized,       at    best,    as

marginally successful.”          Id. at 50.

      As in Ulloa, we should in this case remand so that the

district court can reconsider the amount of attorneys fees in

light of Western’s Pyrrhic victory against Hal. 1

      1
       Interestingly, the district court at first recognized that
any fee award imposed upon Hal must reflect Western’s failure to
recover any meaningful form of relief from him, observing that
“[t]he fact that Western obtained very little relief against Hal
suggests that an award of fees against him is not warranted.”
J.A. 334.     Despite this acknowledgment, the district court
imposed a substantial award against Hal.      In my view, it is
necessary to remand so that the district court can simply act
upon its earlier recognition that the fee award must bear some
relation to the relief recovered.

                                             20
      The majority opinion, in contrast, finds that the district

court ordered Hal to pay a reasonable amount of attorneys fees,

approvingly noting that the district court found it appropriate

to require Hal to pay one-fourth of the fees Western incurred in

the   appeal   before   us   “because    this   Court   held   that   Hal    had

violated   his   agreement    not   to    compete,   constituting     a     final

judgment on the issue of Hal’s breach.”              Ante at 15.      Yet, our

declaration of Hal’s fault during the earlier appeal was not the

primary    rationale    provided    by    the   district   court      for    its

decision to order Hal to pay one-fourth of Western’s fees for

that appeal.     Instead, the district court purported to justify

the award by noting that “the Fourth Circuit ruled in Western’s

favor on the issue of injunctive relief with respect to both

defendants.” 2    J.A. 339; see id. (“Since the Fourth Circuit’s

      2
       The district court’s reliance on this court’s ruling on
injunctive relief in the first appeal also demonstrates the
unreasonableness of the fee award. In Western Insulation, L.P.
v. Moore, 242 F. App’x 112, 124-25 (4th Cir. 2007), the court
did not hold or even suggest that Western was entitled to
injunctive relief against Hal; it merely “reverse[d] the ruling
of the district court that injunctive relief should not be
awarded because the relief requested would impact third parties
not before the court” and “remand[ed] to the district court to
determine in the first instance whether to award such relief,”
expressing “no opinion on whether any particular form of
injunctive relief –- or, indeed, any injunctive relief at all -–
would be appropriate.”     I would accordingly hold that the
district court abused its discretion by basing the award against
Hal solely on fees spent obtaining the Fourth Circuit’s reversal
of the district court’s denial of injunctive relief, when the
(Continued)

                                     21
decision reversing the Court’s order on the issue of injunctive

relief affected both Hal and Melanie, they will share the burden

of paying Western for the cost of litigating the case before the

Fourth    Circuit”).      Indeed,      there      was     good   reason     for     the

district court not to have focused on our finding that Hal had

breached the agreement in making its fee calculation.                       While we

did describe as a breach of contract Hal’s hiring of two former

Western   employees,     the   issue   was      not     disputed    in   the    appeal

before us.     See Western Insulation, L.P. v. Moore, 242 F. App’x

112, 118 n.5 (4th Cir. 2007) (“The district court found that

Hal’s hiring of these employees constituted a breach of his Non-

Compete but that Western failed to prove any damages therefrom.

The   Moores   do   not    dispute     that       these    hirings       constituted

breaches, and Western does not challenge the determination that

it failed to prove any damages therefrom”).

      Therefore,    in    this   case,      I    cannot     agree    that      it   was

reasonable for the district court to have ordered Hal to pay

$41,606.46 in attorneys fees because that was a portion of the

fees incurred at the stage “of the litigation where his fault

was determined.”       Ante at 15.

district court on remand          again         refused    to    order    injunctive
relief against Hal.

                                       22
     With respect to the 8% enhancement of the fee award based

on the case’s length and complexity, our court and the Supreme

Court have recognized that “as a general rule, the novelty and

complexity   of    a     lawsuit   will   be   reflected   in   the   number    of

billable hours” and that “‘[n]either complexity nor novelty of

the issues, therefore, is an appropriate factor in determining

whether to increase the basic fee award.’”                 Daly v. Hill, 790

F.2d 1071, 1078 (4th Cir. 1986) (quoting Blum v. Stenson, 465

U.S. 886, 898–99 (1984)).           I would, accordingly, vacate the 8%

enhancement of Western’s fee award against Melanie, reducing the

award assessed against her from $165,414.83 to $153,161.88, and

direct   that     such    an   enhancement     not   be    considered   by     the

district court in determining a reasonable attorneys fee award

in Western’s favor against Hal.

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