United States District Court, S.D. Ohio, Eastern Division
Elizabeth P. Deavers Magistrate Judge
OPINION AND ORDER
EDMUND A. SARGUS, JR. CHIEF UNITED STATES
matter is before the Court for consideration of
Defendant's Objection (ECF No. 335) to the Magistrate
Judge's Report and Recommendation (ECF No. 334). For the
reasons that follow, the Court ADOPTS the
Report and Recommendation (ECF No. 334) and
DISMISSES Plaintiffs Objection (ECF No.
Ohio Willow Wood Company ("Plaintiff'), an Ohio
corporation, initiated this case on December 27, 2004. (ECF
No. 1). On November 18, 2011, Plaintiff filed an Amended
Complaint. (ECF No. 120). Plaintiff alleged that Defendant
Alps South, LLC ("Defendant"), a Florida based
limited liability company, infringed on Plaintiffs patent,
U.S. Patent No. 5, 830, 237 (the '"237
Patent"). (Compl. ¶ 9, ECF No. 1). Defendant
brought a counterclaim, contending that the '237 Patent
is unenforceable because Plaintiff acquired it through
inequitable conduct. (Answer ¶ 92, ECF No. 127). On
August 10, 2012, the Court ruled on the parties' cross
motions for summary judgment. (ECF No. 209). The Court
granted summary judgment in favor of Plaintiff on the issue
of inequitable conduct. (Op. & Or. at 1, ECF No. 209).
However, the Court denied Plaintiffs Motion for Summary
Judgment with respect to patent infringement, finding the
'237 Patent claims at issue to be invalid.
parties appealed to the Federal Circuit. (See ECF
Nos. 217 & 222). On November 15, 2013, the Federal
Circuit reversed the Court's grant of summary judgment on
the issue of inequitable conduct. (ECF No. 226). The case was
remanded. (Id.). After holding a bench trial on the
issue of inequitable conduct, the Court ruled in
Defendant's favor. (ECF No. 278). The Court also granted
attorney fees to Defendant pursuant to 35 U.S.C. §285.
(Id.). Following an appeal, the Federal Circuit
affirmed the Court's judgment that: (1) the '237
patent is unenforceable for inequitable conduct, and (2)
Defendant is entitled to attorney fees. (ECF No. 290). The
case was remanded again, this time for a determination of
attorney fees owed to Defendant. (ECF No. 297). Before the
Court issued a decision on regarding the amount of attorney
fees, the parties settled and Plaintiff filed a stipulated
dismissal. (ECF No. 305).
11, 2016, Defendant's former counsel, Shumaker, Loop,
& Kendrick, LLP ("Shumaker"), moved for an
attorney charging lien on Defendant. (ECF No. 299). Shumaker
represented Defendant from 2008 until December 16, 2015, when
Defendant discharged the firm. (Id. at 1-2).
Shumaker seeks an equitable charging lien of $639, 946.19
against Defendant for unpaid legal services and unreimbursed
expenses. (Id. at 1). Shumaker alleges that out of
the $1, 236, 803.58 Defendant owed in attorney fees, $614,
893.08 remains unpaid. (Id. at 2). hi addition,
Shumaker asserts that out of its $64, 744.42 in advanced
expenses, $25, 053.10 was never reimbursed. (Id.).
Defendant filed a Response in Opposition, asserting that it
adequately compensated Shumaker by paying $700, 539.84 in
fees and expenses. (ECF No. 300). On September 19, 2017, the
Court granted Shumaker's Motion and ordered the
imposition of a $639, 946.18 charging lien on any settlement
funds paid to Defendant. (ECF No. 306). The $639, 946.18
charging lien covered Defendant's unpaid legal fees
($614, 893.08) and unreimbursed expenses ($25, 053.10).
October 19, 2017, Defendant moved for reconsideration of the
Court's Order. (ECF No. 307). The Court granted
Defendant's motion in part, ordering that Shumaker
disclose the invoice and billing information supporting its
$639, 946.18 request witiiin twenty days. (Id.). In
addition, the Court granted Defendant's request for an
evidentiary hearing. (Id.). On June 15, 2018, the
Court referred the evidentiary hearing to a United States
Magistrate Judge pursuant to 28 U.S.C. § 636(b). (ECF
No. 320). The Magistrate Judge held an evidentiary hearing on
October 30, 2019 and October 31, 2019. (ECF Nos. 328 329).
Following the hearing, the Magistrate Judge ordered briefing
on the proper legal standard to apply to Shumaker's
request for attorney fees. Defendant and Shumaker filed
briefs on December 4, 2018. (ECF Nos. 332 & 333).
28, 2019, the Magistrate Judge issued a Report and
Recommendation recommending that Shumaker's request for
attorney fees be granted. The Magistrate Judge further
recommended the imposition of a $639, 946.18 attorney
charging lien on any settlement funds paid to Defendant in
this matter. Defendant filed an Objection on June 11, 2019.
(ECF No. 335). The matter is now ripe for review.
Ohio common law, attorneys have a right to assert a lien
against a judgment they obtain on behalf of their client.
Filius v. Outdoor Sports Headquarters, Inc., No.
C-3-90-358, 1995 WL1612532, at *2 (S.D. Ohio May 18, 1995).
The Ohio Supreme Court outlined the concept of an attorney
charging lien in Cohen v. Goldberger, 141 N.E. 656
(1923). As the Cohen court explained:
The right of an attorney to payment of fees earned in the
prosecution of litigation to judgment, though usually
denominated a lien, rests on the equity of such attorney to
be paid out of the judgment by him obtained, and is upheld on
the theory that his services and skill created the fund.
Id. at paragraph one of the syllabus.
Cohen describes a lien attached to a judgment,
courts have not interpreted this language as prohibiting the
attachment of a lien to settlement proceeds. See, eg,,
Filins, 1995 WL 1612532, at *2-3; Devis v. Pineview
Ct. Condo. Ass'n, 8th Dist. Cuyahoga No. 102147,
2015- Ohio-2704, ¶¶ 5, 11. Nor have Ohio courts
interpreted Cohen's language as prohibiting the
attachment of a Hen when an attorney is discharged before the
lawsuit is settled (or final judgment is entered in the
case). See, e.g., Filius, 1995 WL 1612532, at *2;
Cuyahoga Cnty. Bd. of Comm'rs v.
Maloof Props., Ltd., 197 Ohio App.3d 712 (Ohio Ct.
App. 2012). Additional factors that Ohio courts have
considered when deciding whether to impose a charging lien
(1) the right of the client to be heard on the merits; (2)
the right of an attorney to invoke the equitable jurisdiction
of the courts to protect his fee for services rendered; (3)
the elimination of unnecessary and duplicative litigation;
(4) the opportunity for the client to obtain counsel to
litigate the claim for attorney fees; (5) the propriety of an
order as opposed to a judgment; (6) a forum for the
presentation of witnesses, if necessary; and (7) the
equitable nature of the proceeding.
Fire Prot. Res., Inc. v. Johnson Fire Prot. Co., 594
N.E.2d 146, 149-50 (Ohio Ct. App. 1991). Ultimately though,
the decision to impose an attorney charging lien is based on
the facts and circumstances of the particular case and is
left to the sound discretion of the court. Kerger
& Hartman, LLC v. A/ami, 54 N.E.3d 682, 686
(Ohio Ct. App. 2015).
Report and Recommendation, the Magistrate Judge analyzed the
Cohen factors and concluded "the equities in
this case still favor the imposition of a lien."
(R&R at 7, ECF No. 334). Additionally, the Magistrate
Judge declined to recommend "that the Court use the
lodestar analysis here, finding the Cohen analysis
sufficient." (Id. at 12). Nevertheless, the
Magistrate Judge recommended that, even applying the lodestar
analysis, Shumaker's requested fees be found reasonable
and awarded. (Id. at 12). Defendant contends that
the fees sought by Shumaker are inequitable under the
Cohen framework. (Obj. at 3, ECF No. 335).
Furthermore, Defendant "also objects to the [Report and
Recommendation] to the extent it based its conclusion solely
on Cohen." (Id.). According to Defendant, the
lodestar method described in Hensley v. Eckerhart,
461 U.S. 424 (1983) is the appropriate formula for
determining the amount of the attorney charging lien.
(Id.). Applying the lodestar framework, Defendant
argues that the Court failed to give proper weight to the
testimony of Thomas Shunk ("Mr. Shunk"), a witness
who testified on behalf of Defendant at the evidentiary
noted in the Report and Recommendation, "[t]he Court has
already undertaken an analysis of whether Shumaker's
request that an attorney charging lien be placed on any
settlement funds obtained by [Defendant] satisfies the
requirements outlined in Cohen and the additional
factors analyzed by Ohio courts." (R&R at 5). This
prior analysis notwithstanding, the Court begins by
conducting a de novo review under Cohen.