Slep-Tone Entertainment Corp. v. Karaoke Kandy Store, Inc.
782 F.3d 313
6th Cir.2015Background
- Slep-Tone sued Karaoke Kandy Store and Charles Polidori for selling hard drives with Slep-Tone’s registered trademarks; jury returned an advisory verdict finding no trademark infringement and the district court entered judgment for defendants.
- After judgment, Slep-Tone timely filed a Rule 52(b) motion requesting findings of fact and conclusions of law; that motion remains pending.
- Twenty-one days after judgment, defendants moved for attorney fees under 15 U.S.C. § 1117(a) and sanctions (and separately sought an extension under Rule 54); the district court denied the fee motion as untimely and denied fees on the merits as not an "exceptional case," and denied sanctions.
- Defendants appealed the denial of fees; Slep-Tone appealed the adverse judgment and also moved for appellate sanctions under Rule 38.
- The Sixth Circuit held the fee motion was not untimely because Slep-Tone’s timely Rule 52(b) motion tolled the Rule 54(d)(2)(B)(i) 14-day clock; the court remanded for the district court to resolve the pending Rule 52 motion and to reassess fee entitlement in light of Octane Fitness.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness of § 1117(a) fee motion under Fed. R. Civ. P. 54 | Rule 54’s 14-day deadline makes defendants’ motion untimely (filed 21 days after judgment) | Timely because Rule 52(b) motion by Slep-Tone tolled the Rule 54 clock | Held: Not untimely — a timely Rule 52(b) tolls the Rule 54 period until resolved |
| Whether case is "exceptional" under 15 U.S.C. § 1117(a) warranting fees | Not exceptional; district court properly denied fees on merits | Case was exceptional due to meritless claims and litigation conduct | Held: Remanded for district court to decide after resolving Rule 52(b) motion and considering Octane Fitness guidance |
| Whether Rule 38 appellate sanctions are appropriate for defendants’ appeal | Defendants’ appeal frivolous because they didn’t argue timeliness | Appeal not frivolous because timeliness argument is correct | Held: Denied — appellate sanctions inappropriate given timeliness ruling |
| Proper next step | Final judgment should stand and fees denial affirmed | Case should be remanded for further proceedings on fees after Rule 52 resolution | Held: Remanded to district court to resolve Rule 52(b) and then reconsider fee request under Octane Fitness framework |
Key Cases Cited
- Brown v. Local 58, Int’l Bhd. of Elec. Workers, AFL-CIO, 76 F.3d 762 (6th Cir.) (post-judgment motion tolls finality for purposes of fee-timeliness analysis)
- Miltimore Sales, Inc. v. Int’l Rectifier, Inc., 412 F.3d 685 (6th Cir.) (Rule 54 clock tolled while certain post-judgment motions pending; judgment not final for appeal while such motions unresolved)
- Weyant v. Okst, 198 F.3d 311 (2d Cir.) (Rule 54(d)(2)(B) motion is timely if filed within 14 days after resolution of specified post-judgment motions)
- Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749 (2014) (fee-shifting “exceptional case” test requires consideration of totality of circumstances and objective reasonableness)
- Indep. Fed’n of Flight Attendants v. Zipes, 491 U.S. 754 (1989) (statutes with similar language should be interpreted consistently)
- United States v. Hynes, 467 F.3d 951 (6th Cir.) (similar-language statutes with similar purposes are interpreted consistently)