Optima Media Group Limited v. Bloomberg L.P.

Background

The plaintiffs brought the action after Bloomberg terminated the parties’ license agreement. Following a nine-day bench trial, the court found that the plaintiffs had not proved their breach-of-contract claims. It also found that Bloomberg had not proved its trademark-infringement counterclaim. The court did find that Bloomberg proved breach-of-contract counterclaims against Plaintiff OMG, awarded damages, and determined that Bloomberg was entitled to reasonable costs, including attorney’s fees.

Bloomberg then sought $17,978,535.67 for attorney’s fees, expert fees, and vendor disbursements connected with discovery, depositions, and trial. The application included $14,963,858.70 for attorney’s fees and costs based on approximately 26,864 hours billed by Paul Weiss lawyers and litigation-support staff, plus $2,949,126.51 for expert, vendor, and related costs.

Bloomberg’s Entitlement to Fees

The agreement required the plaintiffs to indemnify Bloomberg for claims, damages, liabilities, costs, and expenses, including reasonable attorney’s and expert fees, arising out of or connected with a breach of the agreement by the licensee or its affiliates.

The court rejected the plaintiffs’ arguments that Bloomberg was not entitled to any award. Under New York contract law, the absence of contemporaneous time records did not prevent a fee award, although the party seeking fees still had to provide adequate information showing that the fees were reasonable. The declaration submitted for Bloomberg generally described the work and included monthly invoices. The court found that this support was sufficient to establish Bloomberg’s entitlement, but that its lack of detailed time records supported reducing the amount.

The court also found that Bloomberg had shown that the claimed fees and costs were actually paid. It treated the plaintiffs’ unconscionability argument as waived because the plaintiffs had not raised it in their post-trial motion. Finally, the court rejected the argument that the agreement did not cover fees connected with Bloomberg’s unsuccessful counterclaims. Because those claims were related to and directly responded to OMG’s breach, the court concluded that the fees were incurred in connection with a breach covered by the agreement.

Reduction of Attorney’s Fees and Costs

A court evaluating a fee request considers both the hourly rates and the number of hours billed. The court found that Bloomberg’s rates were at the high end of rates generally approved in the district, including partner rates as high as $1,326 per hour. More importantly, Bloomberg submitted no itemized time sheets or specific entries showing how the 26,864 hours were calculated or how much time each person spent on the case.

Because the application was too vague to permit a reliable evaluation of the hours claimed, the court applied an across-the-board reduction rather than denying fees entirely. It reduced the attorney’s-fee and cost request by 50 percent and awarded $7,481,929.35 for those amounts.

Expert, Vendor, and Related Costs

Bloomberg also sought $2,949,126.51 for expert, vendor, and related costs. The court found that Bloomberg showed these costs had been incurred, but had not adequately established their reasonableness. The supporting documents did not itemize expert hourly rates, total hours, or specific work performed by the experts and vendors. The court therefore reduced this request by 50 percent and awarded $1,474,563.25.

Disposition

Judge Alison J. Nathan granted Bloomberg’s motion for attorney’s fees, but with reductions. The court awarded Bloomberg $7,481,929.35 in attorney’s fees and costs and $1,474,563.25 in additional costs. The order resolved Docket Number 184, directed the Clerk of Court to issue judgment, and closed the case.