                              UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT


                              No. 15-2339


EXCLAIM MARKETING, LLC,

                Plaintiff - Appellant,

          v.

DIRECTV, LLC,

                Defendant – Appellee,

and

DIRECTV OPERATIONS, LLC; DIRECTV, INCORPORATED,

                Defendants.



                              No. 15-2399


EXCLAIM MARKETING, LLC,

                Plaintiff – Appellee,

          v.

DIRECTV, LLC,

                Defendant – Appellant,

and

DIRECTV, INCORPORATED; DIRECTV OPERATIONS, LLC,

                Defendants.
Appeal from the United States District Court for the Eastern
District of North Carolina, at Raleigh.   Louise W. Flanagan,
District Judge. (5:11-cv-00684-FL)


Argued:   October 28, 2016            Decided:   December 29, 2016


Before SHEDD, AGEE, and WYNN, Circuit Judges.


Affirmed by unpublished per curiam opinion.


ARGUED: Joseph H. Nanney, Jr., MEYNARDIE & NANNEY, PLLC,
Raleigh, North Carolina, for Appellant/Cross-Appellee.   Michael
Ernest Williams, QUINN EMANUEL URQUHART & SULLIVAN, LLP, Los
Angeles, California, for Appellee/Cross-Appellant.     ON BRIEF:
Robert C. Van Arnam, WILLIAMS MULLEN, Raleigh, North Carolina,
for Appellee/Cross-Appellant.


Unpublished opinions are not binding precedent in this circuit.




                                2
PER CURIAM:

      A    jury    awarded   $760,000.00               to    Exclaim     Marketing,     LLC,

(“Exclaim”) on its North Carolina Unfair and Deceptive Trade

Practices Act (“UDTPA”) claim against DirecTV, LLC, (“DirecTV”)

and   $25,000.00     to   DirecTV       on       its    counterclaim        for   trademark

infringement.       Thereafter, the district court granted DirecTV’s

motions for judgment as a matter of law on the UDTPA claim and

for   an   increased      award    of    profits             under   the    counterclaim.

Exclaim appeals both of these judgments.                         In addition, DirecTV

has filed a cross-appeal challenging the district court’s denial

of its motion for attorney’s fees.                     For the reasons that follow,

we affirm the judgments of the district court in their entirety.



                                             I.

      Exclaim is a nationwide marketing company that, in relevant

part, acts as a liaison between potential satellite television

consumers    and    satellite      television               retailers.      It    purchases

thousands     of    telephone      numbers         that        are   then    included       in

telephone directories under various listings.                            Often, a single

Exclaim telephone number will be used in multiple listings in

multiple    directories.          When       a    consumer       calls     the    number,    a

telemarketer at a call center asks some screening questions and

then forwards the call to one of its clients, a retailer of

satellite television.           These retailer-clients pay Exclaim for

                                             3
each    forwarded          call,    regardless            of    whether       the    consumer

eventually purchases satellite television.

       The   retailers       in    turn    have      contracted        with    one    or   more

providers     of    satellite       television            to   “market,   advertise,         and

promote” their services.                  Exclaim Mktg., LLC v. DirecTV, LLC

(Exclaim     I),     134     F.    Supp.    3d       1011,      1016   (E.D.N.C.       2015).

DirecTV and Dish Network are the leading satellite television

providers in the United States.                       DirecTV’s retailer contracts

regulate how its retailers operate and include a restriction

that DirecTV retailers can only contract with a third party –-

such as Exclaim –- with DirecTV’s written consent.                              DirecTV did

not provide written authorization for its retailers to contract

with Exclaim.

       Although most of Exclaim’s telephone directory listings are

identified in generic terms such as “satellite television,” some

of its listings used the name “DirecTV” or a close variant such

as   “Direct    TV”    or     “DIRECTTV.”             When     DirecTV    discovered         the

unauthorized use of its name, the company concluded that was a

violation      of    its    trademark.              Accordingly,       DirecTV       hired    an

outside company to investigate who owned the listings by calling

the numbers associated with them.                     In addition, one of DirecTV’s

employees     also    called       some    of       the    listings.      At     times,      the

callers would give the intermediary telemarketer a false name as

part of their conversation.                Once DirecTV identified Exclaim as

                                                4
the    owner      of     numbers    tied     to    these       allegedly      infringing

listings,        DirecTV    contacted       Exclaim      and       asked   that     Exclaim

coordinate to have the listings removed or renamed.                                Exclaim

took steps to remove some of the listings, but over the course

of    several     years    DirecTV    continued          to    identify     unauthorized

listings owned by Exclaim using DirecTV’s name and its variants.

       In 2011, Exclaim filed a lawsuit in North Carolina state

court against DirecTV alleging that it had violated the UDTPA,

N.C. Gen. Stat. § 75-1.1 et seq.                      On the basis of diversity

jurisdiction,          DirecTV    removed    the    case      to    the    U.S.    District

Court for the Eastern District of North Carolina and filed a

counterclaim against Exclaim alleging trademark infringement, in

violation of the Lanham Act, 15 U.S.C. § 1114. 1

       At   trial,      Exclaim    alleged       UDTPA    violations        arising    from

multiple practices, but the jury found that DirecTV only engaged

in    one   of    them.     Specifically,         the    jury      found    that    DirecTV

“telephoned Exclaim Marketing, LLC’s call center over 175 times

over a six year period, at times using false names.”                          J.A. 1743.

It further found that this conduct proximately caused injury to

Exclaim and that Exclaim was entitled to damages in the amount

of $760,000.00.

       1
       Other claims and counterclaims made in the course of the
litigation were dismissed or otherwise resolved and are not at
issue in this appeal.



                                             5
      On DirecTV’s counterclaim, the jury found that Exclaim used

DirecTV’s     “trademark        or    a    misspelling       of    the   trademark       in

connection with the sale, offering for sale, distribution or

advertising of products or services,” and that it did so “in a

manner likely to cause confusion, mistake, or deception as to

the source, origin, affiliation, approval, or sponsorship” of

Exclaim’s goods or services.                J.A. 1744.       The jury specifically

found that Exclaim’s conduct was “undertaken with the intent to

confuse or deceive” and awarded DirecTV $25,000.00 for trademark

infringement.      J.A. 1746.

      The    issues      on   appeal       arise    from     the    district     court’s

rulings on three post-trial motions filed by DirecTV.                             First,

DirecTV renewed its motion for judgment as a matter of law on

Exclaim’s    UDTPA    claim,         contending       that   its    conduct      did    not

support a UDTPA claim as a matter of law.                          The district court

granted DirecTV’s motion, concluding that the phone calls to

Exclaim     were   not    “in    or       affecting    commerce,”        nor   did     they

constitute an “unfair or deceptive” practice, both of which were

required to state a UDTPA claim.                   Exclaim I, 134 F. Supp. 3d at

1020-25.     Second, DirecTV moved for an increased profits award

on its successful trademark infringement claim, contending that

$25,000.00 was inadequate to account for Exclaim’s wrongdoing.

The   district     court      granted       that    motion    as    well,      though    it

awarded less than the amount DirecTV sought.                       The district court

                                             6
awarded DirecTV $610,560.00 based on a calculation of the profit

Exclaim derived from each infringing number over the course of

Exclaim’s   infringement.          Exclaim    Mktg.,   LLC    v.    DirecTV,   LLC

(Exclaim    II),     No.    5:11-CV-684-FL,    2015    WL    5725692   (E.D.N.C.

Sept. 30, 2015).           Third, DirecTV moved for statutory attorney’s

fees in light of its successful trademark infringement verdict.

The district court denied that motion, concluding no award of

attorney’s fees was warranted because this case did not meet the

statutory requirement of being “exceptional.”                     Exclaim Mktg.,

LLC v. DirecTV, LLC (Exclaim III), No. 5:11-CV-684-FL, 2015 WL

5725703 (E.D.N.C. Sept. 30, 2015).

     Exclaim noted a timely appeal, as did DirecTV.                      We have

jurisdiction under 28 U.S.C. § 1291.



                                      II.

     This case presents three issues: (1) whether the district

court   erred   in    granting     DirecTV’s   motion       for   judgment    as   a

matter of law on Exclaim’s UDTPA claim; (2) whether the district

court abused its discretion in increasing the jury’s award of

damages from $25,000.00 to $610,560.00 in profits arising from

DirecTV’s    trademark       infringement    claim;    and    (3)   whether    the

district court abused its discretion in denying DirecTV’s motion

for statutory attorney’s fees as the prevailing party in the

trademark infringement claim.         We address each issue in turn.

                                       7
                                  A. UDTPA Claim

      In order to establish a claim under the UDTPA, Exclaim had

to    demonstrate     the   following       elements:     “(1)       that    [DirecTV]

engaged in conduct that was in or affecting commerce, (2) that

the conduct was unfair or [deceptive], and (3) that [Exclaim]

suffered    actual    injury      as   a   proximate     result      of     [DirecTV’s]

deceptive statement or misrepresentation.”                    See ABT Bldg. Prods.

Corp. v. Nat’l Union Fire Ins. Co. of Pittsburgh, 472 F.3d 99,

122 (4th Cir. 2006). 2          The “occurrence of the alleged conduct,

damages, and proximate cause are fact questions for the jury,”

but “whether [such] conduct was unfair or deceptive is a legal

issue for the court,” as is whether the conduct was “in or

affecting commerce.”        Id. at 123; see also S. Atl. Ltd. P’ship

of Tenn., LP v. Riese, 284 F.3d 518, 534 (4th Cir. 2002); Sara

Lee     Corp.   v.    Carter,      519     S.E.2d      308,    311    (N.C.     1999).

Consistent with these standards, the only issues the district

court     submitted    to   the    jury     on   the    UDTPA     claim      were   the

occurrence      of    the   individual         acts,     proximate        cause,    and

injury/damages.       Each of the jury’s findings was left intact by

the district court when it considered the purely legal issues on




      2We have omitted internal quotation marks, alterations, and
citations here and throughout this opinion, unless otherwise
noted.



                                           8
liability raised in DirecTV’s renewed motion for judgment as a

matter of law.

      Consequently, we review the district court’s decision to

grant the motion for judgment as a matter of law de novo.                     Belk,

Inc. v. Meyer Corp., 679 F.3d 146, 164 (4th Cir. 2012) (stating

that questions of law surrounding a motion for judgment as a

matter of law following a jury trial are reviewed de novo while

the   jury’s      factual   findings       are     reviewed    under      a    more

deferential standard).          Similarly, we apply the same de novo

standard in reviewing the district court’s interpretation of the

UDTPA.   Id.

      The unfair or deceptive conduct element of a UDTPA claim is

set out in the alternative, meaning that an act can be either

unfair or deceptive to satisfy this requirement.                 A practice is

“unfair”   when    “a   court   of   equity      would   consider   [it   to   be]

unfair,” S. Atl. Ltd. P’ship of Tenn., 284 F.3d at 535, i.e.,

“when it offends established public policy as well as when the

practice   is   immoral,    unethical,      oppressive,       unscrupulous,     or

substantially injurious to consumers,” id. at 536.                   A practice

is “deceptive” if it “has the capacity or tendency to deceive.”

Id.   Under either category, “only practices that involve some

type of egregious or aggravating circumstances are sufficient to

violate the U[D]TPA.”       Id. at 535.



                                       9
      Exclaim contends that DirecTV’s practice was unfair because

placing     more     than    175     calls     to   Exclaim     was    “unethical,

oppressive, and unscrupulous.”               Opening Br. 17.       Exclaim posits

that DirecTV did not adequately communicate with it to remedy

the problematic listings and questions why some of the calls

received were tied to generic listings if the sole purpose of

DirecTV’s     calls    was     to    investigate       potential      infringement.

Exclaim further contends that North Carolina recognizes that an

inequitable        assertion    of     power    can     constitute      an    unfair

practice, and it asserts that is what occurred here given that

DirecTV’s size and resources dwarf Exclaim’s.                 We disagree.

      The district court correctly held that the evidence does

not   demonstrate      that     DirecTV’s      conduct    was      egregiously     or

aggravatingly unfair.          As a reminder, the “practice” at issue is

DirecTV’s    placing    more    than    175    phone    calls   over    a    six-year

period.     Although the calls to Exclaim’s call centers were not

spread out evenly, that frequency represents roughly 2-3 calls

to Exclaim’s call center each month for six years.                     Put another

way, it equals roughly 0.002958% of Exclaim’s total volume of

calls.    Exclaim I, 134 F. Supp. 3d at 1023.

      It is questionable whether such a “practice” could ever be

considered “unfair” on its own.               Cf. id. (“Without more factual

specificity in the jury’s verdict, it is impossible to glean any

unfairness from the simple fact of the telephone calls.”).                       But

                                         10
the record eliminates any doubt.                         It is not unfair to Exclaim

that   Exclaim’s      own    publicly         available          telephone          listings     led

DirecTV to call Exclaim’s call centers.                          This is especially true

given that DirecTV had a legitimate business purpose for placing

those calls due to its investigating who owned the phone numbers

associated with listings it reasonably believed infringed on its

trademark.       Indeed,      the    reasonableness                of     its       investigatory

method was admitted by Exclaim’s co-owner, who testified that if

he did not recognize a listing identified as “Exclaim,” he, too,

would call the number to determine who was associated with it.

As    the   district    court       noted,          “The        numbers    were        public[]ly

available and could have been called by anyone.”                               Id.

       Exclaim      emphasizes,          as        it     did    at     trial,        that      some

unspecified number of calls DirecTV placed to its call center

were associated with generic listings.                          Even assuming that to be

the    case,   it    does    not    render              DirecTV’s      conduct        an   “unfair

practice.”       The    record      demonstrates                that    some        numbers     were

associated with both generic and infringing listings.                                  Moreover,

at the time DirecTV called a listing, it had no way of knowing

that Exclaim owned the associated phone number, so there is no

evidence    that     DirecTV       was    targeting             Exclaim        by    calling    any

particular     listing,      whether          it    was     generic       or    not.       Lastly,

DirecTV’s employee testified that she would occasionally call

generic     listings        for     business             reasons        unrelated          to    the

                                               11
investigation, such as to identify a retailer’s ad that she did

not recognize in order to determine whether the retailer was in

compliance with the retailer’s contract.                    On this record, that

some unspecified number of phone calls may have been placed to

numbers linked solely to generic listings does not undermine the

conclusion that DirecTV’s investigative effort of placing more

than 175 calls to Exclaim’s call center over a six-year period

was   not    an    unfair      practice,        let     alone    an   egregious   or

aggravating one.

      Exclaim’s     argument       about    DirecTV’s       allegedly    inadequate

communication      to    resolve    the     infringing      listings     misdirects

attention from the salient inquiry -- whether placing the phone

calls was an unfair practice.               Again, until DirecTV placed the

phone calls, it could not tie Exclaim to any specific infringing

number because Exclaim was not identified on the listing.                         The

parties’ communications after a specific number had been tied to

Exclaim are immaterial to whether the practice of placing calls

in the first instance was unfair.                More problematic for Exclaim,

however,    is    that   for   years     and     even    after   republication     of

certain     directories,       DirecTV      continued       to    find   infringing

listings tied to Exclaim.           And so long as the problem remained,

DirecTV acted fairly in calling those numbers to determine who

owned them.



                                           12
       While an inequitable assertion of power may be part of the

unfair-practice analysis in some cases, it is not at issue here.

The fact of a size disparity between companies, without more, is

not sufficient to demonstrate an unfair practice; rather, courts

examine       what       the    actor     did    in    combination        with    that    size

disparity       to       conclude    that       the    exertion      of    an     inequitable

assertion of power was unfair.                       See, e.g., S. Atl. Ltd. P’ship

of Tenn., 284 F.3d at 540 (observing that “manipulations and

assertions          of     controlling          influence”       such       as    exploiting

contractual rights without providing compensation is “precisely

the    kind    of    ‘inequitable            assertion[]’      of    power”      that    is   an

unfair trade practice under the UDTPA).                        DirecTV may be a larger

business than Exclaim, but nothing in the record indicates that

this    disparity          enabled      or    contributed       to    the       acts    Exclaim

complains were unfair.                  As the district court concluded, “[n]o

superior degree of power or advantageous market position was

leveraged” when DirecTV called publicly available phone numbers

to determine who owned them.                      Exclaim I, 134 F. Supp. 3d at

1023.

       The telephone calls also were not a “deceptive practice”

for    UDTPA    purposes.           Yet      again,    there    is   nothing      inherently

deceptive about the jury’s factual finding that DirecTV placed

the calls.       Cf. id. at 1024 (“[T]he fact of the calls involve[d]

no deception.”).               But even accepting that the premise of being a

                                                13
potential consumer or the use of a false name was “deceptive,”

the    record       demonstrates          that        it        was        not    egregiously          or

aggravatingly         deceptive.               The     DirecTV             employee       at      issue

testified based on her past personal experience that she was

often stonewalled in her efforts to identify the owner of the

phone numbers she called.                In particular, when she used her real

name to place calls, telemarketers would be uncooperative or

would be instructed to hang up when recognizing her name from

past       calls.      DirecTV’s          use    of        the        false       name     was        thus

intrinsically         linked        to   --     and        an    effective             means     of     --

investigating the source of infringing listings.                                        As such, it

did    not    constitute       an    egregiously            or    aggravatingly            deceptive

practice.

       For    these    reasons,          the    district          court          did    not    err     in

concluding that DirecTV’s placing more than 175 calls over a

six-year period could not, as a matter of law, constitute an

unfair or deceptive trade practice under the UDTPA.                                           As such,

DirecTV was entitled to judgment as a matter of law regardless

of    the    jury’s    findings          with    respect              to    other       elements       of

Exclaim’s claim. 3



       3
       In light of this holding, we need not address the parties’
arguments concerning the district court’s additional grounds for
granting DirecTV’s motion, that the phone calls were not “in or
affecting commerce.”



                                                14
                 B. Trademark Infringement Counterclaim

      Exclaim    separately       contends     the    district    court      erred    in

granting DirecTV’s post-judgment motion for increased profits on

its trademark infringement claim.                To establish such a claim,

the Lanham Act provides that a plaintiff –- such as DirecTV –-

who   establishes     a   violation    of    §   1114(1)(a)      is    entitled      “to

recover (1) defendant’s profits, (2) any damages sustained by

the plaintiff, and (3) the costs of the action.”                           15 U.S.C. §

1117(a)      (emphasis    added).        The     pertinent       statute       further

provides:

      In assessing profits the plaintiff shall be required
      to prove defendant’s sales only; defendant must prove
      all elements of cost or deduction claimed. . . . If
      the court shall find that the amount of the recovery
      based on profits is either inadequate or excessive the
      court may in its discretion enter judgment for such
      sum as the court shall find to be just, according to
      the circumstances of the case.    Such sum . . . shall
      constitute compensation and not a penalty.

Id.

      This    Court   has       previously   recognized      that      the     statute

“gives little guidance on the equitable principles to be applied

by a court in making an award,” and has “identified six factors

to guide the process” of “weigh[ing] the equities of the dispute

and   exercis[ing]        its     discretion     on     whether       an     award   is

appropriate and, if so, the amount thereof.”                 Synergistic Int’l,

LLC v. Korman, 470 F.3d 162, 174-76 (4th Cir. 2006).                             Those

factors   are:    “(1)    whether     the    defendant     had    the       intent    to

                                        15
confuse or deceive, (2) whether sales have been diverted, (3)

the adequacy of other remedies, (4) any unreasonable delay by

the plaintiff in asserting his rights, (5) the public interest

in making the misconduct unprofitable, and (6) whether it is a

case of palming off.”             Id. at 175.

       The district court granted DirecTV’s motion based on its

conclusion that the jury’s award of $25,000.00 was insufficient

in light of the infringement at issue.                         Under the statutory

burden-shifting             analysis,    the    district      court   observed     that

DirecTV satisfied its burden of proving Exclaim’s total profits,

thereby          shifting    to   Exclaim      the   burden   of   parsing   out   its

profits that were unrelated to the infringement.                        Based on the

quite limited evidence put forward by Exclaim on that point, the

district court concluded it had failed to meet its burden to

distinguish between profits attributable to infringement and any

others. 4         Nonetheless, the court concluded that “[i]t would be

inequitable to award DirecTV the entirety of Exclaim’s profits

over       the    relevant     period”   because      while   Exclaim   owned    6,000



       4
       In its reply brief, Exclaim argues DirecTV did not satisfy
this burden because it demonstrated total profits, while the
statute should be interpreted to require a plaintiff to show
profits relating to the infringing activity.        Because that
argument is raised for the first time in the reply brief, we do
not consider it.    See Cavallo v. Star Enter., 100 F.3d 1150,
1152 n.2 (4th Cir. 1996) (holding that "an issue first argued in
a reply brief is not properly before a court of appeals").



                                               16
telephone numbers, only 159 were associated with an infringing

listing.       Exclaim II, 2015 WL 5725692, at *4.                            Instead, the

court multiplied the 159 listings by the record evidence as to

the “average profit per month per phone number” (between $75.00

and $80.00 per telephone number) over the entire period during

which Exclaim was infringing DirecTV’s trademark.                                  Id.      Under

that   calculation         method,       the   district         court    awarded         DirecTV

$610,560.00.

       The    district        court     also    noted      that       such    an     increased

profits       award     was     appropriate         in     light       of     the     relevant

Synergistic factors.             In particular, it found that Exclaim’s

conduct      was     willful,    that     injunctive        relief      did    “not      remedy

Exclaim’s usurpation of the good will associated with DirecTV’s

mark    for     the    period      at     issue,”        that    DirecTV’s          delay    was

reasonable         considering          the    period       of        investigation          and

reconciliation, and that the jury’s award had not been adequate

to make future infringement unprofitable.                       Id.

       The Court reviews the district court’s decision to increase

an award of profits for an abuse of discretion.                              Pac. Ins. Co.

v. Am. Nat’l Fire Ins. Co., 148 F.3d 396, 402 (4th Cir. 1998)

(citing Fed. R. Civ. P. 59(e)).

       Exclaim contends the district court abused its discretion

because the record shows DirecTV suffered no harm from Exclaim’s

conduct       and,    in   fact,        profited     because       many       of     Exclaim’s

                                               17
referrals       to     retailers        resulted    in     new      DirecTV        customers.

Exclaim asserts that the Synergistic factors do not support the

increased award of profits because Exclaim did not act in bad

faith,   it     did     not    divert    sales,     an    injunction         against      using

DirecTV’s       mark     adequately       protects       DirecTV’s         interests,       and

there    is     no    evidence     of    palming    off.       In     addition,       Exclaim

points     to        DirecTV’s     delay     in    filing          suit,     a    period     of

approximately          four      years     from    when       it     first       learned    of

infringing listings.              Lastly, Exclaim argues that anything more

than the jury’s nominal damages award constitutes a windfall and

unlawfully punishes Exclaim rather than compensates DirecTV.

     We conclude the district court did not abuse its discretion

in granting DirecTV’s motion for increased profits.                                  Many of

Exclaim’s arguments ignore the purpose of prohibiting trademark

infringement and the Lanham Act’s plain language, which allows

prevailing       plaintiffs        to    recover     not      just     an        amount    they

suffered in actual damages, but also a share of the defendants’

profits from the infringement.                    Cf. 15 U.S.C. § 1117(a).                  The

district      court     has    broad     discretion      to    award       such    relief    in

order to achieve an equitable result.                         E.g., Burndy Corp. v.

Teledyne Indus., 748 F.2d 767, 772 (2d Cir. 1984).

     Here, the district court did not abuse its discretion in

concluding       that    the     Synergistic       factors     favored       an     increased

profits award.           For example, the jury specifically found that

                                             18
Exclaim    intended       to     confuse       or     deceive         consumers       by     using

DirecTV’s trademark.             See Synergistic, 470 F.3d at 175 (stating

a    defendant’s       “intent    to    confuse          or    deceive”       can     support    a

profits award).          In addition, an injunction did not provide any

relief for Exclaim’s past wrongdoing and would also be unlikely

to    adequately       deter      future      misconduct             given    the     scope     of

Exclaim’s     past       misconduct      and        its       proven    profitability          for

Exclaim.     Cf. id. at 176.               The district court also reasonably

rejected    Exclaim’s         argument     that      DirecTV         unreasonably          delayed

filing    suit     and     thus    should       not       be     entitled       to    increased

profits.    In so doing, the court observed that DirecTV undertook

an    extensive    investigation,          attempted            to     resolve       the    matter

without     litigation,          and     had        to    wait         for    new     telephone

directories       to     be    released        in    order       to     determine          whether

infringement continued.                Cf. id.           The district court thus not

only relied on the proper analysis for determining whether to

award increased profits, but also did not abuse its discretion

in    weighing     the     relevant      circumstances               and     concluding       that

increased profits were appropriate.                      Cf. id.

       In addition to challenging any increase from the jury’s

award for Exclaim’s infringement, Exclaim also argues that the

record does not support the district court’s decision to award

profits in the amount of $610,560.00.                          It contends the evidence

presented     at       trial     did    not     show          that     Exclaim       owned     159

                                               19
infringing phone numbers, but only nine numbers, and that the

district court relied on evidence that was not in the record to

reach the      higher     number.        In    addition,      Exclaim       contends         the

record does not show that it owned all of those numbers for the

entire period of time used to calculate the profits award.                                   As

such, Exclaim maintains that any increased profits award should

be substantially reduced.

       We have reviewed the record and conclude that no reversible

error    occurred.        Three       exhibits      that   were    admitted        at    trial

support    the     district       court’s      attribution         of     159    infringing

numbers to Exclaim: an email in which Exclaim admitted to owning

twenty-nine       unique    infringing          numbers     and     two         spreadsheets

DirecTV’s      agent       prepared          compiling      the     results         of       its

investigation, in which an additional 130 unique numbers were

linked    to   Exclaim.          It    does    appear      that    not     all     of    these

telephone numbers were traced to infringing listings for the

entire    period    for    which       the    district     court        awarded    profits.

Nonetheless, we conclude that the district court did not err in

arriving at its final profits award.

       As already noted, the statute authorizes the district court

to     exercise    broad    equitable          discretion     in        arriving        at   an

appropriate award.           Coupled with this discretion is the fact

that    Exclaim    bore    the    burden       of   showing       why    certain        of   its

profits    should    be    excluded       from      an   award,     yet    it     failed      to

                                              20
present   relevant        evidence   for      the    district      court    to   use    in

considering       an     appropriate     profits         award.         Once     DirecTV

satisfied       its     statutory    burden         of   demonstrating         Exclaim’s

profits for the relevant period of time, the burden shifted to

Exclaim to show what amount of profits were not related to its

infringement.          See 15 U.S.C. § 1117(a).             Here, Exclaim made no

attempt to meet that burden.             Despite Exclaim’s failure on this

point, the district court went out of its way to fashion a more

equitable result for both parties based on Exclaim’s average

profit    per    month    per    phone   number.          Its     calculation     was   a

reasonable estimation of the profits Exclaim unjustly received,

and any minor variation in the precise number of lines per month

does not make the district court’s award an abuse of discretion.

Indeed,    the    district      court    indicated        that    Exclaim’s      profits

relating to the infringing lines might have been even higher.

Exclaim II, 2015 WL 5725692, at *4 (“[DirecTV] is entitled to

Exclaim’s       profits    at   least    in     the      amount    of   $610,560.00.”

(emphasis added)).         Given these circumstances, greater precision

in arriving at the exact award amount was not required.                              See,

e.g., Banjo Buddies, Inc. v. Renosky, 399 F.3d 168, 177-78 (3d

Cir. 2005) (approving the district court’s attempt to estimate

profits where it was not clear what share came from the wrongful

conduct   versus       other    legitimate      business     conduct       because     the

calculation arrived at an appropriate ballpark figure).

                                           21
                      C. Attorney’s Fees Cross-Appeal

       We next turn to DirecTV’s cross-appeal, in which it argues

the district court erred in denying its motion for attorney’s

fees.       The   Lanham     Act    authorizes         a    district   court     to   award

“reasonable        attorney        fees        to    the     prevailing      party”      in

“exceptional cases.”               15 U.S.C. § 1117(a).                In sum, DirecTV

contends     that     this    case        meets      that    “exceptional”       standard

because the jury specifically found that Exclaim “acted with

‘the intent to confuse or deceive.’”                   Response/Opening Br. 60.

       We review the district court’s decision on the award of

Lanham Act attorney’s fees for an abuse of discretion.                            Newport

News Holdings Corp. v. Virtual City Vision, Inc., 650 F.3d 423,

441 (4th Cir. 2011).                That review leads us to conclude the

district court properly applied the exceptional case analysis

set out in Octane Fitness, LLC v. ICON Health & Fitness, Inc.,

134 S. Ct. 1749 (2014), and expounded upon by this Court in

Georgia-Pacific Consumer Prods. LP v. von Drehle Corp., 781 F.3d

710 (4th Cir. 2015).

       In Octane Fitness, the Supreme Court analyzed the same fee

award standard applicable here albeit under the Patent Act.                             134

S.    Ct.   at    1752.      The    Supreme         Court   held    that   the   ordinary

meaning     of    “exceptional”       indicated        that    fees    should    only   be

awarded in a case “that stands out from others with respect to

the     substantive       strength        of    a    party’s       litigating    position

                                               22
(considering both the governing law and the facts of the case)

or   the   unreasonable       manner       in    which       the    case    was    litigate.”

Factors    to     be     considered       include          “frivolousness,        motivation,

objective        unreasonableness         (both        in     the    factual      and      legal

components of the case) and the need in particular circumstances

to advance considerations of compensation and deterrence.”                                  Id.

at 1756 & n.6.            Furthermore, the Supreme Court indicated that

district        courts      should        “determine           whether        a     case     is

‘exceptional’ in the case-by-case exercise of their discretion,

considering the totality of the circumstances.”                            Id. at 1756.

      This Court applied the Octane Fitness principles to a fee

award    under     §   1117(a)     of     the    Lanham       Act   in     Georgia-Pacific.

There, the Court took care to distinguish that the “exceptional”

case required more than just volitional conduct, else “every

Lanham     Act     case    would     qualify          as    ‘exceptional’         unless    the

defendant        could    show     that    it        unintentionally         or    mistakenly

performed the actions later found to be a violation of the Act.”

781 F.3d at 720.            Instead, following Octane Fitness, the Court

set out three circumstances when, “in light of the totality of

the circumstances,” a case may be deemed “exceptional” such that

an award of fees is appropriate.                     Those circumstances are:

      (1) there is an unusual discrepancy in the merits of
      the positions taken by the parties, based on the non-
      prevailing party’s position as either frivolous or
      objectively unreasonable; (2) the non-prevailing party
      has litigated the case in an unreasonable manner; or

                                                23
       (3) there is otherwise the                          need in particular
       circumstances    to     advance                      considerations of
       compensation and deterrence.

Id. at 721.

       Relying on Octane Fitness and Georgia-Pacific, the district

court concluded this case was not “exceptional.”                             Exclaim III,

2015   WL    5725703,      at    *6-*8.         First,      it    found    that   Exclaim’s

position     was    neither          frivolous       nor   objectively       unreasonable,

particularly in light of the competing legal arguments and facts

presented     at     trial.            Second,        it    found       Exclaim     did    not

unreasonably litigate the case, pointing out as an example that

Exclaim did not re-litigate issues previously decided.                               Lastly,

the court found that the increased profits award had adequately

compensated DirecTV and that a fee award was not needed for

deterrence.

       The   district      court       did   not      abuse      its    discretion    in   so

holding.      Indeed, DirecTV does not take issue with any of the

district court’s findings, nor does it otherwise engage with the

analysis      set    out        in     Octane        Fitness      and     Georgia-Pacific.

Instead, it argues that the district court should not have used

that   analysis      and    should       have        relied      on    pre-Octane    Fitness

Fourth Circuit case law stating that fees may be awarded where a

defendant     willfully         infringes        a    plaintiff’s        trademark.        See

Georgia-Pacific, 781 F.3d at 719-20.                       But in Georgia-Pacific, we

recognized that Octane Fitness modified our prior analysis and

                                             24
“appl[ied]       the   Octane    Fitness     standard     when    considering         the

award of attorneys fees under § 1117(a).”                  Id. at 721.        In doing

so, we set out the three-part test the district court used in

deciding whether to award fees in this case.                  Id. at 719-21.

       Contrary     to    DirecTV’s     contention,       nothing      in    either    of

those cases suggests that the Octane Fitness analysis should not

also     apply     when     a    plaintiff       successfully       prosecutes         an

infringement claim.             While the factual background for Octane

Fitness may have been a prevailing defendant, nothing limits the

overarching objectives identified by the Supreme Court to that

context.        Common sense confirms that both parties are equally

capable     of     taking       unreasonable       positions        or      litigation

strategies, just as the particular facts of a case decided in

either    party’s      favor    may   warrant    compensation       or      deterrence.

While     willfulness       remains      part     of    the     totality       of     the

circumstances informing the analysis, after Octane Fitness and

Georgia-Pacific, it does not end there as DirecTV would have us

hold.      In     short,    even      assuming    Exclaim’s      infringement         was

willful, that is no longer sufficient to show that a case is

“exceptional.”

       The district court understood and applied the proper test

in determining that this case does not satisfy the applicable

standard.       Inasmuch as DirecTV does not otherwise challenge the

basis     for    the     district     court’s    denial    of    its     motion,      the

                                          25
district court did not abuse its discretion in denying DirecTV’s

motion for attorney’s fees.



                                  III.

     For   the   aforementioned   reasons,   the   judgments    of   the

district court are

                                                               AFFIRMED.




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