Attorneys’ Fees Appeal in False Ad Case Too Late, 9th Cir. Says

Nutrition Distribution LLC’s appeal of a judgment denying Lanham Act attorneys’ fees was untimely, despite being in time to challenge a later ruling on a separate attorneys’ fees motion, the Ninth Circuit said Tuesday.

ND won an injunction in its case against IronMag Labs LLC for falsely advertising nutritional supplements as having no “toxicity” or “unwanted side effects.” In the same judgment, the U.S. District Court for the Central District of California denied ND’s request for attorneys’ fees under the Lanham Act.

ND didn’t appeal, but filed a separate post-judgment motion for attorneys’ fees. The court denied the motion, and ND timely appealed it. The notice of appeal also claimed it was appealing the initial judgment.

But ND’s appeal of the initial judgment was too late, and couldn’t be based on the date of the court’s denial of its post-judgment motion.

Although an appeal must typically be within 30 days of the relevant ruling, a motion for attorneys’ fees can extend the time to appeal under Rule 58 of the Federal Rules of Civil Procedure if the district court orders it.

Here, ND didn’t appeal the initial judgment within 30 days, and didn’t move to extend the deadline under Rule 58, the Ninth Circuit said.

ND also argued that its fees motion should be reconsidered as a request under FRCP Rule 59 to alter or amend the judgment, which would also extend the appeal deadline.

That would “facilitate an end-run” around Rule 58, the court said.

“Rather than having to seek the district court’s permission” for the Rule 58 deadline, Nutrition Distribution “would grant itself an extension through the expedient of recharacterizing its own motion,” the court said.

The court said the Federal Rules were amended based on Supreme Court cases that “make clear that attorneys’ fees motions cannot be recharacterized as Rule 59 motions,” and that Rule 59 requests are supposed to relate to the merits of a case, while attorneys’ fee requests raise collateral issues that the rule wasn’t meant to apply to.

“That the district court denied fees when ruling on summary judgment did not transform its initial fees ruling into part of the ‘judgment’ to which a Rule 59 motion could apply,” the court said.

The appeals court also affirmed the district court’s denial of attorneys’ fees based on ND’s post-judgment motion.

Judge Daniel A. Bress wrote the opinion, joined by Judges Milan D. Smith Jr. and Bridget S. Bade.

Tauler Smith LLP represented ND. Ostergar Law Group PC represented IronMag.

The case is Nutrition Distrib. LLC v. IronMag Labs LLC, 9th Cir., No. 19-55251, 8/25/20.