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Federal Judge Scolds Apple, Cisco for Fee Request

May 7, 2020 | Posted in : Billing Practices, Billing Record / Entries, Fee Expert / Member, Fee Request, Lawyering

A recent Law 360 story by Hannah Albarazi, “Alsup Scolds Apple, Cisco for ‘G-R-E-E-D’ in Atty Fee Bid,” reports that U.S. District Judge William Alsup admonished Apple and Cisco during a telephone hearing, asserting that the tech giants tried to land inflated attorney fee awards after beating Straight Path IP Group's infringement litigation and saying they used "abusive" tactics and were motivated by "greed, G-R-E-E-D."

"You played games," Judge Alsup told Cisco Systems Inc. and Apple Inc., referring to their initial bid for $10 million in attorney fees and costs last year that led him to order that they redo their bids and to appoint a special master to determine fees.  "It is so upsetting to me that I almost denied it completely," Judge Alsup said.  He took the motion for fees under submission and said he intends to get an order out in a week.

The judge's admonishing words came nearly three years after Apple and Cisco defeated on summary judgment Straight Path's claims that the Silicon Valley companies had infringed its internet telephone patents.  Last summer, Judge Alsup refused to award Apple and Cisco the $10 million in attorney fees and costs they sought, questioning whether they had overstated costs.  "The law should be that we deny and give you zero," he said at the time.

The judge ordered the companies to resubmit bids for attorney fees and appointed as special master BraunHagey & Borden LLP partner and co-founder Matthew Borden — who once clerked for the judge — to determine a reasonable amount of fees and costs.  Borden recommended that Baker Botts LLP and Desmarais LLP, representing Cisco, get $1.9 million — half of its initial request.

The special master said Cisco failed to provide documents requested by the court to support its fee bid and that the alternative methods for fees proposed by Cisco didn't provide "a meaningful check against overbilling."  "Cisco has not carried its burden of proving that it is entitled to the amount it claims," Borden wrote in his report and recommendations.

Apple, on the other hand, followed the court's order when it redid its bid and provided transparency into its billings, Borden said.  Hogan Lovells, representing Apple, lowered its original request from $3.9 million to $2.4 million. Borden recommended Apple get $2.3 million.  But Judge Alsup slammed the tech giants for not bringing the court a reasonable bid from the get-go.  Judge Alsup called out Apple's in-house counsel during the telephone hearing, saying, "I'm blaming you too."

Justin P.D. Wilcox of Desmarais LLP defended Cisco's requested fee, telling Judge Alsup that the company paid more than $5 million to defend itself in this case.  But Judge Alsup gave Apple and Cisco a stern warning, saying if they ever appear before his court again and don't submit reasonable attorney fee requests from the get-go, he will deny them in their entirety.  "It will be zero," Judge Alsup warned.