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`IN THE UNITED STATES DISTRICT COURT
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`FOR THE EASTERN DISTRICT OF VIRGINIA
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`Newport News Division
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`CLF-HK.U.S iJlSTTllCl COURT
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`CHARLES W. ROSS BUILDER, INC.
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`d/b/a CHARLES ROSS HOMES,
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`Plaintiff,
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`v.
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`Civil Action No. 4:10cvl29
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`OLSEN FINE HOME BUILDING, LLC,
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`BEVERLY OLSEN,
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`BOATHOUSE CREEK GRAPHICS, INC.,
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`RICK J. RUBIN, and JENNIFER L. RUBIN,
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`Defendants.
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`OPINION AND ORDER
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`This matter is before the Court on the motions for attorneys' fees filed by Olsen Fine
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`Home Building, LLC and Beverly Olsen (collectively. "Olseif7}, Boathousc Creek Graphics, Inc.
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`("BCG"), and Rick J. Rubin and Jennifer L. Rubin ("the Rubins") (collectively, "Defendants")
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`on October 13, 2011. For the reasons slated herein, Defendants' Motions are GRANTED IN
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`PART and DENIED IN PART.
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`I.
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`FACTUAL AND PROCEDURAL BACKGROUND
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`On November 24, 2010, Plaintiff Charles W. Ross Builder, Inc., d/b/a Charles Ross
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`Homes ("Plaintiff) filed an Amended Complaint against Olsen, BCG, and the Rubins alleging
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`federal copyright violations against all Defendants (Count One), copyright infringement against
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`the Rubins (Count Two), violations of the Digital Millennium Copyright Act against BCG and
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`Olsen (Count Three), and unfair competition against BCG and Olsen (Count Four). Each of the
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`Defendants filed a Motion to Dismiss the Amended Complaint pursuant to Federal Rule of Civil
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 2 of 10 PageID# 1794
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`Procedure 12(b)(6) and each Defendant subsequently filed a Motion for Summary Judgment. By
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`Opinion and Order dated September 29, 2011, this Court granted Defendants' Motions for
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`Summary Judgment as to Counts One, Two, and Three, and dismissed Count Four without
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`prejudice for lack of jurisdiction. (Docket No. 67.) Each Defendant subsequently filed a Motion
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`for Attorney's Fees and Costs. (Docket Nos. 70, 72, 73.)
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`II.
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`LEGAL STANDARD
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`"Our legal system generally requires each party to bear his own litigation expenses,
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`including attorney's fees, regardless whether he wins or loses. Indeed, this principle is so firmly
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`entrenched that it is known as the 'American Rule.'" Fox v. Vice. 131 S. Ct. 2205, 2213 (2011)
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`(citing Alveska Pipline Svc. Co. v. Wilderness Soc'v. 421 U.S. 240, 247 (1975)). Therefore,
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`unless Congress has authorized "fee shifting," courts ordinarily may not deviate from this
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`background rule. See id
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`III. ANALYSIS
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`A. Digital Millennium Copyright A ct Claims
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`The Digital Millennium Copyright Act ("DMCA") provides that a court "in its discretion
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`may award reasonable attorney's fees to the prevailing party." 17 U.S.C. § 1203(b)(5). In
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`deciding whether to award attorney's fees under the DMCA, courts consider "the motive,
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`reasonableness of the fee, deterrence and compensation, and the ability of the nonmoving party
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`to pay." Dahn World Co.. Ltd. v. Chung. No. RWT 06-2170, 2009 WL 277603, *2 (D. Md. Feb.
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`5, 2009) (citing Rosciszewski. 1 F.3d at 234). At the outset, we find that that Defendants Olsen
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`and BCG meet the threshold requirements for receiving attorney's fees as they were
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`undisputedly the prevailing party before this Court. 17 U.S.C. § 1203(b)(5); Dahn World Co..
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 3 of 10 PageID# 1795
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`2009 WL 277603 at *2. Moreover, the Court finds that in this case, as in Dahn. "all four factors
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`support an award of attorneys' fees" under the DMCA. Id
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`First, Plaintiff recited no facts whatsoever to support its allegation that Defendants Olsen
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`and BCG removed copyright information from Plaintiffs plans in an attempt to pass off the
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`plans as their own. As we noted in our Order on Summary Judgment, Plaintiff "provide[d] no
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`substantive evidence that Defendants provided or distributed any false copyright management
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`information with the intent to induce, enable, facilitate, or conceal infringement or that
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`Defendant removed any copyright information." See Ross v. Olsen Fine Home Bldg.. LLC.
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`(E.D.Va. Sept. 24, 2011) (internal citations omitted). Instead, Plaintiffs DMCA claims appear
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`to have rested solely on its contention that the only plausible explanation for the fact that the two
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`sets of plans in question were, according to Plaintiff, substantially similar, was that Defendants
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`used Plaintiffs plans and removed the copyright information. However, as we previously found,
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`the two sets of plans were not substantially similar, and the "myriad differences" between the
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`Plaintiffs Copyrighted Plans and the plans for the Rubin home show that neither BCG nor Olsen
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`had removed copyright information from the Ross plans. See Id
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`An award of attorney's fees and costs in this case would also support the goals of
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`deterrence and compensation. As Plaintiff had no evidence that Defendants Olsen and BCG had
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`removed copyright information from the Copyrighted Plans, Plaintiffs DMCA claim was
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`frivolous and should not have been brought. Granting attorney's fees as to these claims would
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`deter future plaintiffs from bringing claims under the Act who have no evidence that the
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`defendant at issue removed copyright information. With respect to the issue of compensation,
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`the Court notes that BCG is owned and operated by one individual, Lisa Moberg, who is the
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`company's sole employee and who performs all of its residential design work. (BCG Mot.
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 4 of 10 PageID# 1796
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`Atty's Fees at 6.) Ms. Moberg received approximately $4,000 for her design of the Rubin home
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`and carried no insurance to cover the expenses associated with defending a copyright suit. (Id.)
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`Although Plaintiff is not a large entity itself, it employs seven full-time employees and its
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`resources appear to substantially exceed those of either BCG or Olsen.
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`Moreover, although Plaintiff asserted claims under the DMCA against both Olsen and
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`BCG, Plaintiffs Amended Complaint does not even mention Olsen when discussing the
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`allegations under the DMCA. Rather, it states, "[o]n information and belief, BC Graphics
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`removed Charles Ross Homes' copyright notice from the Copyrighted Plans" and "BC Graphics
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`has falsely represented, and is falsely representing, that the Infringing Plans originated with BC
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`Graphics and/or are BC Graphics' design." Thus, not only did Plaintiff fail to advance facts
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`sufficient to make out a claim for infringement against Olsen under the DMCA, but Plaintiff also
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`failed to even name Olsen in detailing its factual allegations. For the foregoing reasons,
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`Defendant Olsen's and Defendant BCG's Motions for Attorneys' Fees on Plaintiffs DMCA
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`Claims are hereby GRANTED.
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`B. Copyright Act Claims
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`The Copyright Act provides, "In any civil action under this title, the court in its discretion
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`may allow the recovery of full costs by or against any party other than the United States ... the
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`court may also award a reasonable attorney's fee to the prevailing party as part of the costs." 17
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`U.S.C.A. § 505. The plain language of § 505 makes clear that whether to award attorney's fees,
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`and the amount of fees to be awarded, is a matter wholly within the court's discretion. Foqartv
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`v. Fantasy. Inc.. 510 U.S. 517, 533 (1994); Henslev v. Eckerhart. 461 U.S. 424 (1983); Diamond
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`Star Bdle. Corp. v. Freed. 30 F.3d 503, 507 (4th Cir. 1994) (district court need not award costs
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`and attorney's fees as a matter of course). However, in order to inject some measure of
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 5 of 10 PageID# 1797
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`uniformity into the decision-making process, the Fourth Circuit has set forth four factors that
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`courts should consider in determining whether to award attorney's fees and costs. These factors
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`include the following: (i) the motivation of the parties, (ii) the objective reasonableness of the
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`legal and factual positions advanced, (iii) the need in particular circumstances to advance
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`considerations of compensation and deterrence, and (iv) any other relevant factor presented.
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`Rosciszewski v. Arete Assocs.. Inc.. 1 F.3d 225,234 (4th Cir. 1993) (internal citations omitted).
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`1. Plaintiffs Motivation in Bringing Suit
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`Defendants contend that Plaintiff acted in bad faith and with an improper motive in
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`bringing this suit. (Rubin Mem. Atty's Fees at 4; BCG Mem. Atty's Fees at 4-5; Olsen Mem.
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`Atty's Fees at 5.) Specifically, BCG contends that Defendant's motivation for this action "was
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`to deter or harm [BCG's] residential design business in Ford's Colony in order to gain a
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`competitive advantage in the Ford's Colony market," (BCG Mem. Atty's Fees at 5), the Rubins
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`posit that Plaintiff acted in bad faith by failing to contact Defendants to address the situation
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`before bringing suit, (Rubin Mem. Atty's Fees at 4), and Olsen contends that Plaintiff acted in
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`bad faith by "allowing] construction of the Rubin's residence to continue unchallenged for
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`approximately two months before initiating suit" and "serv[ing] Olsen without any. prior notice
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`to Olsen or any attempt at resolution." (Olsen Mem. Atty's Fees at 5 (emphasis in original).)
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`Plaintiff counters that it brought suit not to stifle competition in the Ford's Colony area,
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`but because it "believed that it had a valid and enforceable copyright hi The Bainbridge
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`architectural work and that it sought to protect the substantial investment it had made in the
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`design of The Bainbridge." (Def.'s Mem. in Opp. at 7.) In response to Defendants' emphasis on
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`Plaintiffs failure to send a "cease and desist" letter prior to bringing suit, Plaintiff states that its
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 6 of 10 PageID# 1798
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`delay in bringing suit was the result of its desire to wait to determine whether continued
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`construction of the Rubins' home would evince substantial dissimilarities to The Bainbridge
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`design, thereby rendering legal action unnecessary. (Id at 7-8.) Finally, Plaintiff states that
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`"[t]here is no evidence in this case that [Plaintiff] acted in bad faith by bringing this copyright
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`action." (Id at 8.) We agree. Certainly, a more appropriate response by Plaintiff would have
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`been to contact Defendants as soon as Plaintiff suspected infringement and to attempt to resolve
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`the matter outside of the adversarial system. But Plaintiff was under no legal obligation to
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`pursue any such remedial action prior to filing suit, and failure to do so, without more, does not
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`amount to considered bad faith.1
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`Nonetheless, because the Supreme Court has expressly held that the absence of bad faith
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`is not dispositive in the determination of whether to award attorney's fees, we must examine the
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`additional factors as set forth in Rosciszewski to determine whether an award of attorney's fees
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`is proper in this case. See Fogartv. 510 U.S. at 533 (rejecting the argument that defendants were
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`required to prove bad faith to prevail on a motion for attorney's fees under 17 U.S.C. § 505);
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`Rosciszewski. 1 F.3d at 225 (same).
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`1 Defendants cite a number of cases in support of their contention that Plaintiffs failure to attempt a non-judicial
`resolution of the dispute constituted bad faith. However, each of these cases is distinguishable from the instant
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`litigation. For example, in Oravec v. Sunny Isles Luxury Ventures. L.C.. 2010 WL 1302914 (S.D. Fla. 2010), the
`court found that the plaintiff "did not initiate this action with entirely altruistic motives, which is demonstrated by
`his twenty-month silent acquiescence to the Trump Buildings' construction and failure to engage in timely pre-suit
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`discussions." Id. at S. However, in Oravec. the Court only awarded fees and costs to Defendants because it found
`that Plaintiff had failed to remove patently unreasonable claims from the pleadings and that Plaintiff had a pecuniary
`motive in pursuing these unreasonable claims. In Superior Form Builders. Inc. v. Dan Chase Taxidermy Supply
`Co.. the Fourth Circuit upheld an award of attorney's fees where the plaintiff had engaged in such conduct as
`registering sculptures obtained from another as its own and talcing inconsistent positions in litigation. 74 F.3d 48S
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`(4th Cir. 1996). However, Plaintiff did not here engage in this type of outrageous behavior.
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 7 of 10 PageID# 1799
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`2-
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`Objective Reasonableness of Plaintiff s Claims
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`In assessing the objective reasonableness of a plaintiff s claims, courts consider "whether
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`the positions advanced by the parties were frivolous, on the one hand, or well-grounded in law
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`and fact, on the other hand." SER Solutions. Inc. v. Masco Cnrp 103 Fed. Appx. 483, 489 (4
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`Cir. 2004). A plaintiffs position is frivolous, and thus objectively unreasonable, where the issue
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`of substantial similarity in a copyright action is found not to be "a close or complex question."
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`S^ Earth Flag Ltd. v. Alamo Flag Co., 154 F. Supp. 2d 663, 668 (S.D.N.Y. 2001).Defendants
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`rely heavily on the fact that this case was resolved on summary judgment to argue that Plaintiffs
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`suit was "clearly frivolous when brought." However, this argument begs the question. Adopting
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`the position advocated by Defendants - that the grant of summary judgment in favor of a
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`defendant inevitably means that the plaintiffs claims were objectively unreasonable - would
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`establish a per se entitlement to attorney's fees whenever a copyright plaintiff faces an adverse
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`summary judgment ruling. As this Court has previously held, such a position is at odds with the
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`discretionary standard clearly established by both the United States Supreme Court and the
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`Fourth Circuit. See, e.g.. Tessler v. NBC Universal. Tnc.. No. 2:08cv234, 2010 WL 3835061
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`(E.D.Va. Sept. 29, 2010) ("simply because a defendant is successful in obtaining 'summary
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`judgment does not necessarily mean that the plaintiffs position was frivolous or patently
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`unreasonable'"). See also Positive Black Talk. Inc. v. Cash Money Records. Inc.. 394 F.3d 357,
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`383 (5th Cir. 2004) (to accept the argument that plaintiffs "claim was per se objectively
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`unreasonable because the jury found in favor of the defendants is without merit - to accept such
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`an argument necessarily would transform the discretionary rule into the clearly rejected British
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`Rule, under which a prevailing defendant always recovers fees.").
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 8 of 10 PageID# 1800
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`Moreover, although this Court found that most of the features of Plaintiffs design to
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`which it claimed copyright protection and to which it alleged infringement were either in the
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`public domain and not protected or entitled only to "thin" protection, thereby entitling the
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`Defendants to prevail at the summary judgment stage, these findings do not render Plaintiffs
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`claims patently unreasonable. See Charles W. Ross Builder. Inc. v. Olsen Fine Home R1HP
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`LLC, No. 4:10cvl29, 2011 Wl 4590003, at 15 (E.D.Va. Sept. 29, 2011). Indeed, at the time of
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`this Court's ruling on summary judgment, the Fourth Circuit had not squarely addressed certain
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`issues raised by Plaintiffs copyright suit. Even assuming that Plaintiff knew or should have
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`known that copyright protection for The Bainbridge was limited, Plaintiff was - as this Court
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`acknowledged - entitled to some such protection and we find now that it was not unreasonable
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`for Plaintiff to seek to enforce the limits of that protection. See Tessler. 2010 WL 3835061, at
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`*9 ("[Defendant's] summary judgment success simply reflects the fact that [Plaintiff] was unable
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`to establish a prima facie case for copyright infringement; it does not necessarily imply that the
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`factual or legal grounds of the case rise to the level of objective unreasonableness."). Moreover,
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`in stark contrast to Plaintiffs claims brought under the DMCA, Plaintiffs copyright claims were
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`grounded in adequate factual bases. Although Plaintiff ultimately did not prevail on these
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`claims, such failure does not render its claims frivolous or objectively unreasonable.
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`3- Considerations of Compensation and Deterrence
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`The Fourth Circuit has instructed that "the goal of deterring a party from pursuing
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`frivolous litigation is furthered by the imposition of attorney's fees and costs." Diamond Star
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`Bldg. Corp., 30 F.3d at 506. Defendants point to this language to buttress their contention that
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`awarding attorney's fees will deter future filings of frivolous copyright litigation. However, in
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`Diamond Star, the district court referred to the suit as "a piece of litigation that should never
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 9 of 10 PageID# 1801
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`have been brought" and "a case of. .. absolute insignificance." Jd That is simply not the
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`case
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`here. Although we ultimately found that Plaintiffs copyright claims lacked merit, its claims
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`were not so utterly lacking in foundation or legal basis as to amount to "a defamation of a
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`copyright case," as the court characterized the plaintiffs claims in Diamond Star. Id
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`Certainly, awarding attorney's fees to prevailing defendants is one means of "deterfring]
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`copyright holders from filing such suits without first attempting to resolve the matter outside of
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`court." See Dawes-Ordonez v. Forman. 418 Fed. Appx. 819, 892 (11th Cir. 2011) (citing
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`Fogerty, 510 U.S. at 527). However, Plaintiffs copyright claims were not such a flagrant
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`attempt to abuse copyright law that they merit the strong medicine of awarding the prevailing
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`party attorney's fees and costs. To award attorney's fees here, without evidence of bad faith or
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`frivolity, would pave the way for granting such fees as a matter of course whenever a copyright
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`holder-plaintiff is defeated on summary judgment. This sweeps too far, and could potentially
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`chill litigation properly brought to enforce copyright protections. Finally, although Defendants
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`argue that the Court should award attorney's fees on the grounds that they lack the resources to
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`cover the costs of litigation, (Rubin Mem. Arty's Fees at 6; BCG Mem. Arty's Fees at 6), this is
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`but one factor to be taken under advisement. See Rosciszewski. 1 F.3d at 234. In light of the
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`other considerations weighing against the award of attorney's fees and costs, it does not tip the
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`scale heavily enough in favor of granting fees and costs as to Plaintiffs copyright claims.
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`In sum, we find that none of the factors set forth in Rosciszewski. nor any other factor,
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`counsels in favor of awarding attorney's fees and costs on Plaintiffs copyright claims, pursuant
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`to 17 U.S.C. § 505, as set forth in Counts One and Two of the Complaint. Therefore,
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`Defendants' Motions for Attorney's Fees as to the claims arising under the aforesaid Copyright
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`Act are hereby DENIED.
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`Case 4:10-cv-00129-RGD-DEM Document 96 Filed 01/09/12 Page 10 of 10 PageID# 1802
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`B. CONCLUSION
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`For the reasons stated herein, the Court finds that it is in the interests of justice to deny
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`Defendant's motions for attorney's fees as to Plaintiffs Copyright Act claims under 17 U.S.C. §
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`505 but to award such fees with respect to Plaintiffs claims under the Digital Millennium
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`Copyright Act under 17 U.S.C. § 1203(b)(5). Therefore, the Rubins' Motions for Attorney's
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`Fees and Costs are hereby DENIED. Olsen and BCG's Motion for Attorney's Fees and Costs
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`are hereby DENIED as to the claims brought under the Copyright Act under 17 U.S.C. § 505 but
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`GRANTED as to the claims brought under the Digital Millennium Copyright Act under 17
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`U.S.C. § 1203(b)(5). Olsen and BCG are further ORDERED to file within thirty days after the
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`judgment becomes final affidavits detailing the expenses and costs they incurred specifically in
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`defending the DMCA claims so that the Court may determine the proper amount of their award.
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`The Clerk is DIRECTED to deliver a copy of this Order to all counsel of record.
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`It is so ORDERED.
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`Newport News, Virginia
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`January 1 ,2012
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`Robert G. Doumar
`Senior United S