## Facts

- F.B.T. Productions, LLC and Em2M, LLC received royalties for master recordings of Marshall Bruce Mathers III (Eminem) under recording agreements with Aftermath Records and related entities.
- The dispute concerned how royalties for permanent digital downloads and mastertones should be calculated under the agreements: either as “Records Sold” royalties or “Masters Licensed” royalties.
- The district court initially denied plaintiffs’ summary judgment motion, tried the case, and a jury found for defendants, effectively applying the “Records Sold” provision; defendants then obtained an attorneys’ fee award.
- On appeal, the Ninth Circuit held the contracts were unambiguous and that the “Masters Licensed” provision governed permanent downloads and mastertones; it reversed and directed judgment for plaintiffs and vacated defendants’ fee award.
- After certiorari was denied, the case returned to the district court on remand to implement the appellate mandate and resolve post-judgment issues, chiefly attorneys’ fees and costs.

## Issues

1. Whether plaintiffs, in light of the appellate reversal and directed judgment, were the “prevailing party” entitled to attorneys’ fees and costs under the fee-shifting provisions and California Civil Code § 1717.
2. Whether defendants could remain entitled to attorneys’ fees based on their earlier jury verdict and pre-appeal success.
3. How the court should assess reasonableness and apportionment of plaintiffs’ requested fees, including whether work on related non-contract matters was compensable.

## Decision

- The court held plaintiffs were the prevailing parties because the appellate decision granted them the greater relief on the central contract dispute and materially altered the parties’ legal relationship in plaintiffs’ favor.
- The court enforced the contractual fee-shifting provisions as applied through California Civil Code § 1717 and awarded plaintiffs reasonable attorneys’ fees and costs for the contract action.
- The court treated defendants’ earlier fee award as unsustainable after reversal and applied the appellate mandate requiring vacatur of that award.
- In fixing the amount, the court used the lodestar method and permitted recovery for work sufficiently tied to the contract claims, including work intertwined with related issues.

## Legal Principles

- Under California Civil Code § 1717, the prevailing party on a contract is the party obtaining “greater relief” when comparing the judgment with the parties’ litigation objectives.
- When a contract contains an attorneys’ fee clause for actions to enforce or interpret the agreement, § 1717 makes the clause reciprocal and governs prevailing-party fees in an “action on a contract.”
- An appellate reversal that directs judgment for the other side generally eliminates the foundation for a prior fee award premised on the reversed judgment.
- Reasonable attorneys’ fees are commonly calculated using the lodestar approach (reasonable hours × reasonable rates), with adjustments informed by results obtained and other case-specific factors.
- Fee segregation between contract and non-contract work is not required where the work is so interrelated that separation is impracticable; intertwined work may be compensated.

## Conclusion

On remand, the district court implemented the appellate mandate by recognizing plaintiffs as the prevailing parties on the contract, vacating defendants’ earlier fee award tied to the reversed judgment, and awarding plaintiffs reasonable attorneys’ fees and costs under the agreements and California Civil Code § 1717.


F.B.T. Prods., LLC v. Aftermath Records, 827 F. Supp. 2d 1092 (C.D. Cal. 2011)