Law Question

Read the attached case. Provide a summary analysis of what you learned and how you would apply it in a management situation. Be sure to analyze how this could apply to a business owner starting a new restaurant that has worked at a previous restaurant with a similar menu.

Case:

MICHAEL CHOW, a.k.a. Mr. Chow, MR. CHOW ENTERPRISES, LTD, a California limited partnership, MC MIAMI ENTERPRISES, LLC, a Florida limited liability company, et al., Plaintiffs -Counter Defendants-Appellants, v. CHAK YAM CHAU, PHILIPPE MIAMI, LLC, a Florida limited liability company, PHILIPPE WEST COAST LLC, et al., Defendants -Counter Claimants -Appellees.PER CURIAM[DO NOT PUBLISH] D.C. Docket No. 1:09-cv-21893-WMH Appeal from the United States District Court for the Southern District of Florida before MARCUS and JILL PRYOR, Circuit Judges, and RESTANI, Judge. PER CURIAM: Honorable Jane A. Restani, Judge for the United States Court of International Trade, sitting by designation. This appeal arises from a dispute over Chinese food. Michael Chow (“Chow”) is a chef who has opened a number of Chinese restaurants, all called “Mr. Chow”(“Mr. Chow”), in Beverly Hills, New York City, and Miami Beach. Chow v. Chak Yam Chau,555 F. App’x 842, 843-44(11th Cor. 2014). The restaurants have distinctive menus and decors, and feature as entertainment a display of noodle-making by the staff.Id.at 844. A twenty-five-year employee of the New York Mr. Chow, Philippe Chow Chau (born Chak Yam Chau), left his employment and, in December of 2005, collaborated with restaurateur Stratis Morfogen (“Morfogen”) to open a Chinese restaurant called “Philippe by Philippe Chow” (“Philippe”) a few blocks away from one of the New York Mr Chow restaurants.Id.New restaurantsin Miami Beach and Beverly Hills, all with the same name, were subsequently opened.Id.The menus, decors, and entertainment at the Philippe restaurants are quite similar to those found at the Mr Chow restaurants.Id.This is our Court’s second encounterwith this litigation. In our previous, unpublished opinion, we addressed various post-trial motions not pertinent to this appeal.SeeChow v. Chak Yam Chau,555 F. App’x 842(11th Cir. 2014).There is no period following the “Mr” in “Mr Chow.”In 2009, Chow and corporations associated with Mr Chow filed suit in the United States District Court for the Southern District of Florida against Chau, Morfogen, and other individuals and corporations associated with Philippe.Id.The plaintiffs alleged trademark, trade name, and trade dress infringement; false advertising; misappropriation of trade secrets; and unfair competition under federal, state, and common law.Id.Some defendants counterclaimed for defamation and sought to deregister Chow’s trademark in “Mr Chow.”Id.Prior to trial, the district court granted summary judgment to all defendants on Chow’s unfair competition claims underCalifornia Business and Professions Code §§ 17200-17210and the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”),Fla. Stat. §§ 501.201-213.Id.at 844. After trying the case on the remaining claims, but before submitting it to the jury, the district court also granted judgment as a matter of law to the defendants on Chow’s trade secrets misappropriation claim, which was barred by the statute of limitations.Id.at 844-45.

The jury returned a verdict for corporate plaintiff TC Ventures, Inc., which operated the New York Mr Chow, against corporate defendant Davé 60 NYC, Inc. (“Davé 60 NYC”), which operated the New York Philippe, on the false advertising and unfair competition by deceptive conduct claims.Id.at 845. It also returned a verdict on those claims in favor of Chow, individually, against Morfogen.Id.The plaintiffs prevailed on none of their remaining claims for trademark infringement, unfair competition, or conversion. The defendants received verdicts in their favor on the plaintiffs’ remaining FDUTPA claim of unfair or deceptive practices. None of the defendants’ counterclaims against the plaintiffs succeeded. Following the entry of judgment, the prevailing defendants (which were all of the defendants other than Davé 60 NYC and Morfogen)moved for attorney’s fees under FDUTPA, as well as under New York and federal law. In its order granting attorney’s fees and costs under FDUTPA, the district court noted the following “relevant facts”:In a previous motion, prior to the first appeal to this Court, all of the defendants had moved for fees and costs. The district court denied the motion as premature, due to the anticipated appeal. Morfogen and Davé 60 NYC then filed separate motions for fees, which were both denied by the district court.* Plaintiff TC Ventures, Inc., obtained a jury verdict in the amount of $520,451 against Defendant Davé 60 NYC, Inc., as to claims of false advertising under the Lanham Act and common law claims of unfair competition.* Plaintiff Michael Chow was determined to be entitled to $500,000 from Defendant Stratis Morfogen as to claims of false advertising under the Lanham Act and common law claims of unfair competition.* No other Plaintiffs were successful in their claims against any Defendants.* Defendants Philippe Chow, David Lee, Manny Hailey, Costin Dumitrescu, Philippe Miami LLC, and Philippe West Coast LLC were not found liable as to any Plaintiffs’ claims.* Defendants who filed counterclaims were not successful.The district court noted that, under FDUTPA, “the prevailing party, after the exhaustion of all appeals, may receive his or her reasonable attorney’s fees and costs from the nonprevailing party.” The plaintiffs had brought FDUTPA claims against every defendant, and all of the defendants had prevailed on those claims. The district court further noted that “Plaintiffs did not prevail on the majority of their claims and did not prevail at all as to the majority of the Defendants. Indeed, Plaintiffs only prevailed on a narrow issue: false advertising and a common law theory of unfair competition, and only as to Defendants Davé 60 NYC, Inc., and Stratis Morfogen.”Based on its view that “the major thrust of the evidence presented by Plaintiffs was as to the allegedly stolen trade secrets and the alleged infringement as to the Plaintiffs’ name and style of cooking -which is at the heart of the FDUTPA claim,” the district court concluded that the prevailing defendants were entitled to attorney’s fees under the statute. Because it determined that the “evidence presented at trial as to false advertising [the claim on which plaintiffs prevailed] was less than one-fourth, at most, of the evidence presented, and as to the overall

litigation the question of false advertising was of much less focus than the claimed trade secret theft and alleged infringement,” the district court “determined that the most appropriate approach . . . is to simply reduce the defendant’s billed hours by one-fourth.” On that basis, the district court calculated that the appropriate fees award was $1,160,290.69, which represented three-quarters of Defendants’ total attorney’s fees of $1,547,054.25. It further awarded costs totaling $182,992.12 to the prevailing defendants, which was the entire amount the prevailing defendants requested. In addition to the award of taxable costs, FDUTPA allows for the award of non-taxable costs, i.e. those costs that are not taxable under federal law at28 U.S.C. § 1920.SeeFla. Stat. § 501.2105(1)-(4). Plaintiffs had also moved for costs against Defendants. The district court decided that approximately 20%, or $8,000, was the appropriate amount of costs to be assessed in favor of Plaintiffs TC Ventures, Inc. and Michael Chow for their successful claims against Defendants Davé 60 NYC and Morfogen. As for the Plaintiffs’ costs in defending against the Defendants’ counterclaims, the district court decided that most of the costs incurred were unnecessary, and decided that only 10% ($8,150) of the requested award was appropriate. Plaintiffs contest the district court’s decision to award Defendants any attorney’s fees and costs, contending that Defendants do not qualify under FDUTPA as the “prevailing party” in this litigation. Alternatively, even if Defendants were the prevailing party, Plaintiffs argue that the district court failed to consider the relevant equitable factors in exercising its discretion to award attorney’s fees. Finally, Plaintiffs challenge the district court’s calculation of the attorney’s fees and costs. After careful review, we conclude that the district court correctly decided that Defendants were entitled to attorney’s fees and costs.

 

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Provide a summary analysis of what you learned and how you would apply it in a management situation.

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