Andrew Leonard v. Stemtech International Inc ( 2016 )


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  •                             PRECEDENTIAL
    
          UNITED STATES COURT OF APPEALS
               FOR THE THIRD CIRCUIT
                   ______________
    
                 Nos. 15-3198 & 15-3247
                    ______________
    
              ANDREW PAUL LEONARD,
                d/b/a APL Microscopic
                             Appellant in No. 15-3247
                          v.
    
           STEMTECH INTERNATIONAL INC;
          STEMTECH HEALTHSCIENCES, INC.;
              JOHN DOES 1-100, Inclusive,
    
                 Stemtech International Inc and
                 Stemtech HealthSciences, Inc,
                             Appellants in No. 15-3198
                    ______________
    
    ON APPEAL FROM THE UNITED STATES DISTRICT
                          COURT
          FOR THE DISTRICT OF DELAWARE
         (D.C. Nos. 1-08-cv-00067, 1-12-cv-00086)
         District Judge: Honorable Leonard P. Stark
                      ______________
    
                   Argued July 12, 2016
                     ______________
    Before: FUENTES, SHWARTZ, and RESTREPO, Circuit
                              Judges.
    
                     (Filed: August 24, 2016)
    
    Kathleen M. Kushi Carter, Esq [ARGUED]
    Christine R. Arnold, Esq.
    Hollins Law
    2601 Main Street
    Suite 1300
    Irvine, CA 92614
    
    Thomas P. Leff, Esq.
    Casarino Christman Shalk Ransom & Doss
    405 North King Street
    Suite 300, P.O. Box 1276
    Wilmington, DE 19899
                  Counsel for Appellants/Cross-Appellees
    
    Jan I. Berlage, Esq. [ARGUED]
    Gohn Hankey Stichel & Berlage
    201 North Charles Street
    Suite 2101
    Baltimore, MD 21201
    
    James S. Green, Sr., Esq.
    Jared Green, Esq.
    Seitz Van Ogtrop & Green
    222 Delaware Avenue
    Suite 1500, P.O. Box 68
    Wilmington, DE 19899
                  Counsel for Appellee/Cross-Appellant
    
                         ______________
    
    
    
    
                                 2
                     OPINION OF THE COURT
                         ______________
    
    SHWARTZ, Circuit Judge.
    
            Andrew Leonard, a stem cell photographer, and
    Stemtech International, Inc., a company that sells nutritional
    supplements through independent distributors, cross appeal
    various rulings in the copyright infringement lawsuit Leonard
    brought against Stemtech in the District of Delaware. For the
    reasons discussed herein, we will affirm the District Court’s
    pretrial, trial, and post-trial rulings, except the order denying
    prejudgment interest to Leonard, which we will vacate and
    remand.
    
                                    I
    
                    A. Andrew Leonard’s Images
    
           Leonard takes photographs of stem cells using electron
    microscopes. Only a few photographers engage in this highly
    technical type of photography. Leonard obtains cell samples
    from doctors, scientists, and researchers and pays a scientific
    research institution to use an electron microscope to
    photograph the cells. The images first appear in black and
    white, and Leonard uses his “artistic judgment” to enhance
    the photos in color. J.A. 822-23.
    
          Leonard created the images at issue in this case in the
    1990s. Below are the two photographs at issue in this case.1
           1
              Leonard created these images in 1996 but did not
    register them with the U.S. Copyright Office until 2007, when
    he planned to bring this lawsuit.
    
    
    
    
                                   3
    The image on the left will be referred to as Image 3 and the
    right as Image 4.
    
    
    
    
            Leonard markets his photographs through his business,
    APL Microscopic, and, during the relevant time period, used
    a stock photography agency known as Photo Researchers,
    Inc., to license his images.2 He only allows limited licenses
    of his images because, in his view, unlimited usage licenses
    decrease the value of his work.
    
           The licensing fee Leonard charges varies depending on
    whether his images are used for commercial, editorial, or
    educational purposes. Licensing fees are also impacted by
    the size, color, and the medium in which the images will
    appear.
    
           During the 1990s and through the period at issue in
    this case, stem cell images were rare. At that time, Leonard’s
    images were unique and sought after because there were very
    
          2
              Photo Researchers, Inc., is now known as Science
    Source.
    
    
    
    
                                  4
    few photographers who had the technical skill necessary to
    produce such work. Even Stemtech’s Chief Scientific
    Officer, Christian Drapeau, testified that Leonard’s images
    were “extremely valuable.” J.A. 1544.
    
           In licensing his stem cell photographs, Leonard has
    received a range of fees, including a $4,000 fee for a non-
    exclusive license to use his image at trade shows for one year,
    $6,500 for a one-time, non-exclusive license to use one of his
    images on a university website for four years, and $1,325 for
    a one-time, non-exclusive license to use his image in a
    brochure with a print run of 5,000. He also received $1,500
    from Time magazine, which featured one of his images of a
    human bone marrow stem cell on its August 7, 2006 cover.3
    Between 2007 and 2012, Photo Researchers licensed
    Leonard’s images for fees ranging from less than $100 to
    several thousand dollars.
    
                   B. Stemtech and its Distributors
    
           Stemtech “formulates” and sells nutritional supplement
    products through thousands of distributors, J.A. 1387, who
    form the backbone of the company. Each distributor signs an
    agreement and is subject to Stemtech’s policies and
    procedures manual. According to the manual, distributors are
    required to use only Stemtech marketing materials and its
    self-replicated websites. Specifically, the manual provides:
    
    
    
          3
             Image 4 appeared on the cover of Time, albeit in a
    different pink and green color scheme. Because a feature on
    the cover of Time meant worldwide exposure of his work,
    Leonard charged a reduced fee for this editorial use.
    
    
    
    
                                  5
           To promote both the products and the
           tremendous opportunity STEMTech offers,
           distributors must use the Marketing Materials
           and support materials produced by STEMTech.
           . . . Because the Internet recognizes no
           geographic borders (Domestic or Foreign),
           information on the Internet may be legal in one
           State or Country and illegal in another.
           Therefore, Distributors desiring to utilize an
           Internet web page to promote his/her
           distributorship must do so through the
           Company’s official website, using official
           STEMTech replicated templates.
    
    J.A. 2173-74 (emphasis and capitalization in original).
    Stemtech owns the domain and sub-domains of at least some
    of its distributors’ websites, and Stemtech’s vendor operates
    the server that hosts the Stemtech-supplied sites. Distributors
    who purchase a website from Stemtech may customize the
    site only to provide the distributor’s name, phone number,
    email address, and a biography.
    
           C. Leonard and Stemtech’s Initial Discussions
    
           In May 2006, Stemtech contacted Leonard about using
    Image 4 for the “company[’s] internal magazine,” J.A. 869-
    70, and for use on its website. After discussing usage and
    color terms, Leonard provided Stemtech with a quote of $950
    for a “one-year usage” of Image 4 in two places in Stemtech’s
    HealthSpan magazine and a separate quote of $300 for a
    “one-year usage” of the image on the HealthSpan website.
    J.A. 871; 2120. Stemtech declined to license the image for
    website use because “the price was too high,” J.A. 872, but
    chose to use the image twice in its magazine.
    
    
    
    
                                  6
            Leonard sent Stemtech an invoice for $950 for the two
    magazine placements, but was only paid $500. After multiple
    unsuccessful attempts to collect the $450 balance, Leonard
    abandoned his collection effort. Not only did Stemtech fail to
    pay Leonard in full, but it used his images without a license in
    its other promotional materials.
    
            The images appeared on Stemtech websites, its
    distributors’ websites, marketing DVDs, and other
    promotional and recruitment materials. Several Stemtech
    officials and employees explained that using these images
    was important to Stemtech’s business. Chief Scientific
    Officer Drapeau explained: “If you talk about stem cells, you
    need [ ] support for the discussion, so you . . . show a cell
    showing what it’s about . . . . It’s a marketing thing. I
    understand [Leonard’s images’] value totally. I mean, it’s a
    good representation.” J.A. 1539, 1544. George Antarr,
    Stemtech’s Director of North American Sales, produced the
    DVD in which one of Leonard’s images appeared, and
    explained the importance of a visual depiction of a stem cell
    in the video: “[W]e talked about stem cells in the product
    movie, so [ ] it would be good to show that, what one looks
    like . . . [b]ecause [a] visual [is] part of every sentence. A
    picture tells a thousand words.” J.A. 1510. Thus, as Antarr
    noted, using a photograph was important to Stemtech’s
    marketing efforts.
    
                  D. Stemtech’s Unauthorized Use
    
           To make sure his images were not used for
    unauthorized purposes, Leonard “periodically” conducted
    internet searches for images of stem cells. J.A. 879-80. In
    October 2007, Leonard discovered his images on numerous
    
    
    
    
                                   7
    Stemtech and Stemtech-affiliated websites.        He took
    screenshots of and archived the webpages on which his
    images appeared and retained copies of emails he sent to the
    contacts on various sites.
    
           For example, Leonard found his images on
    “yourstems.com,” a website selling a Stemtech product called
    Stem Enhance and in a Stemtech e-book featured on the
    website. J.A. 881, 889. He contacted the site operator,
    informed him of the infringing uses, requested an accounting
    of how long the operator used the images, and sought
    payment for their use. The website operator informed
    Leonard that he and other distributors were using materials
    received from Stemtech. Thereafter, Leonard contacted
    Stemtech’s Chief Compliance Officer, Donna Serritella,
    requesting that Stemtech stop using his images. Serritella
    told Leonard that she thought that one of the images “was on
    the cover of a major publication, and that made it public for
    usage.” J.A. 898.
    
            Despite being on notice of Leonard’s claim that
    Stemtech and its distributors were using his images without
    permission, Stemtech did not notify its distributors of his
    assertion, which it could have done via company-wide email,
    its weekly newsletter, or monthly communications. In fact,
    Leonard continued to discover and document unauthorized
    uses of his photographs on Stemtech-affiliated websites and
    in its materials. For example, in May 2008, Leonard’s friend
    ordered a Stemtech sales kit from a distributor. The sales kit,
    intended for marketing the Stemtech product and training
    distributors, included DVDs with covers featuring one of
    Leonard’s images, and videos of “The Stemtech Story” and
    “Stem Cells and Stem Enhance with Christian Drapeau,”
    which also contained one of the images. J.A. 905-10, 161.
    
    
    
    
                                  8
    Leonard continued to take screenshots of the websites and
    infringing materials, connecting them to Stemtech via website
    addresses, Stemtech-branded materials such as videos and
    PowerPoint presentations, distributor ID numbers, and even
    references and links encouraging website visitors to join the
    Stemtech distribution team.          Additionally, Leonard
    discovered his images on Stemtech’s website system,
    stemtechbiz.com, which involved “websites that Stemtech
    owned and operated,” as well as websites of individual
    distributors. J.A. 945-46.
    
                          E. The Civil Suit
    
           Leonard demanded that Stemtech and several of its
    distributors pay him for the unauthorized use of his images.
    When Stemtech refused, Leonard filed the instant action,
    alleging numerous claims of copyright infringement.
    Following discovery and motion practice, a jury trial
    commenced on Leonard’s claims against Stemtech for direct,
    vicarious, and contributory infringement.4 The jury heard
    testimony from Leonard, a Photo Researchers employee, and
    Stemtech officials and distributors.
    
           In addition, the jury heard testimony from Leonard’s
    damages expert, Jeffrey Sedlik. Sedlik estimated the fair
    market value of a license to use the images. To this end, he
    contacted two of the largest stock photo agencies and two
    agencies that specialize in scientific images to ascertain the
           4
             Stemtech does not appeal the jury’s verdict finding it
    liable for direct copyright infringement and Leonard does not
    appeal the order granting summary judgment to Stemtech on
    his claims for statutory damages and alleged infringement of
    other images.
    
    
    
    
                                  9
    fair market value of microscopic photography images when
    licensed for various forms of media comparable to those
    Stemtech used in its marketing materials. From the quotes
    provided by these agencies, he generated a benchmark
    licensing fee of between $1,277.10 and $2,569.46. He then
    applied the average of these fees to the 92 infringing uses
    identified at trial, which yielded a fee of $215,767.66.
    
            Sedlik then adjusted this figure upward to account for
    the “scarcity or rarity” of Leonard’s images. J.A. 1315-17.
    In other words, Sedlik attempted to capture “the market value
    of stem cell photographs in general, and then the scarcity or
    rarity of particular stem cell images, [which] is a factor that is
    considered in licensing.”5 J.A. 1313. Sedlik recommended a
    premium of three to five times the benchmark to reflect the
    scarcity of the images.6 In addition, he adjusted the
    benchmark figure for “exclusivity,” which accounts for
    “overuse or broad use” of an image, which diminishes the
    value of other uses, by adding a premium of 3.75 to 8.75
    times the benchmark. J.A. 1317-19. After adding the
    adjustments together, he opined that the appropriate damages
           5
             On the rarity point, Sedlik noted that “[s]tem cell
    [photographs] [are] not Sasquatch; however, every
    photographer, everybody in the industry that saw that 2006
    cover of Time, that was kind of a turning point where people
    realized that microscopy can be an art form,” J.A. 1313, and
    “in 2006 and before, there were fewer images available.”
    J.A. 1314.
           6
             Sedlik testified that the multipliers were not applied
    as punishment for Stemtech’s unauthorized use of the images.
    J.A. 1307 (noting “in actual damages, the damages that
    [Sedlik] come[s] up with can’t be of a kind that punish the
    defendant”).
    
    
    
    
                                   10
    would range from $1.4 million to nearly $3 million.
    Stemtech neither cross-examined Sedlik about his use of
    these premiums nor presented its own expert, and asserted
    that Leonard’s past licensing history supported an award of
    only $1,804.
    
           The jury returned a $1.6 million verdict in Leonard’s
    favor on his direct, vicarious, and contributory infringement
    claims against Stemtech.         The District Court denied
    Stemtech’s motion for a new trial on contributory and
    vicarious liability and damages.
    
           In these cross appeals, we are asked to review whether
    the District Court abused its discretion in denying Stemtech’s
    motion for a new trial by finding that the jury’s contributory
    and vicarious infringement findings were supported by
    substantial evidence, and affirming the jury’s damages award,
    which Stemtech contends is unconstitutionally and grossly
    excessive. We are also asked to review the District Court’s
    ruling that Leonard’s counsel’s conduct and certain
    evidentiary rulings did not warrant a new trial. In addition,
    we are asked to consider whether the District Court abused its
    discretion in declining to award Leonard prejudgment
    interest, erred in not permitting the jury to consider awarding
    Leonard infringer’s profits under 17 U.S.C. § 504(b), and
    correctly decided two fee awards.
    
                                  II7
    
                       A. New Trial Standard
          7
            The District Court had jurisdiction pursuant to 28
    U.S.C. §§ 1331, 1332, and 1338(a), and 17 U.S.C. § 101, et
    seq. We have appellate jurisdiction under 28 U.S.C. § 1291.
    
    
    
    
                                  11
           We will first address Stemtech’s appeal of the order
    denying it a new trial. While a court may grant a new trial
    under Rule 59 “for any reason for which a new trial has
    heretofore been granted in an action at law in federal court,”
    Fed. R. Civ. P. 59(a)(1)(A), it should do so only when “the
    great weight of the evidence cuts against the verdict and . . .
    [ ] a miscarriage of justice would result if the verdict were to
    stand,” Springer v. Henry, 
    435 F.3d 268
    , 274 (3d Cir. 2006)
    (internal quotation marks omitted); see Williamson v. Consol.
    Rail Corp., 
    926 F.2d 1344
    , 1352-53 (3d Cir. 1991) (new trial
    should be granted only where the verdict “cries out to be
    overturned” or “shocks [the] conscience”). A district court’s
    power to grant a new trial is limited “to ensure that [it] does
    not substitute its judgment of the facts and the credibility of
    the witnesses for that of the jury.” Delli Santi v. CNA Ins.
    Cos., 
    88 F.3d 192
    , 201 (3d Cir. 1996) (internal quotation
    marks omitted). Our power is similarly limited and we
    review the grant or denial of a motion for a new trial for
    abuse of discretion. Olefins Trading, Inc. v. Han Yang Chem.
    Corp., 
    9 F.3d 282
    , 289 (3d Cir. 1993).
    
           To demonstrate that the District Court erred in
    declining to grant it a new trial because the verdict was
    against the weight of the evidence, Stemtech must establish
    that (1) the jury reached an unreasonable result, and (2) the
    District Court abused its broad discretion in not setting the
    verdict aside. See ZF Meritor, LLC v. Eaton Corp., 
    696 F.3d 254
    , 268 (3d Cir. 2012) (noting that while we exercise
    plenary review of “questions of law underlying a jury
    verdict,” putting those questions aside, a “‘jury verdict will
    not be overturned unless the record is critically deficient of
    that quantum of evidence from which a jury could have
    
    
    
    
                                  12
    rationally reached its verdict.’” (quoting Swineford v. Snyder
    Cty., 
    15 F.3d 1258
    , 1265 (3d Cir. 1994))).
    
                        B. Secondary Liability
    
           Stemtech argues that a new trial is warranted because
    the jury’s contributory and vicarious infringement findings
    are not supported by substantial evidence. Contributory and
    vicarious infringement are theories of secondary liability for
    copyright infringement that “emerged from common law
    principles and are well established in the law.”8 Metro-
    Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 
    545 U.S. 913
    ,
    930 (2005). “Secondary liability for copyright infringement
    does not exist in the absence of direct infringement by a third
    party.” A&M Records, Inc. v. Napster, Inc., 
    239 F.3d 1004
    ,
    1013 n.2 (9th Cir. 2001). Thus, to prove a claim of
    contributory or vicarious infringement, a plaintiff must first
    show direct infringement by a third party. To prove direct
    infringement, a plaintiff must show that (1) it owns a valid
    copyright; (2) another party copied elements of its work
    without authorization; and (3) that party engaged in volitional
    conduct. Kay Berry, Inc. v. Taylor Gifts, Inc., 
    421 F.3d 199
    ,
    203 (3d Cir. 2005); CoStar Grp., Inc. v. LoopNet, Inc., 373
           8
               While “the lines between direct infringement,
    contributory infringement and vicarious liability are not
    clearly drawn,” Metro-Goldwyn-Mayer Studios Inc. v.
    Grokster, Ltd., 
    545 U.S. 913
    , 930 n.9 (2005), “in general,
    contributory liability is based on the defendant’s failure to
    stop its own actions which facilitate third-party infringement,
    while vicarious liability is based on the defendant’s failure to
    cause a third party to stop its directly infringing activities.”
    Perfect 10, Inc. v. Amazon.com, Inc., 
    508 F.3d 1146
    , 1175
    (9th Cir. 2007).
    
    
    
    
                                  
    13 F.3d 544
    , 551 (4th Cir. 2004). Volitional conduct occurs
    when a party engages in “the act constituting infringement.”
    CoStar Group, 373 F.3d at 551 (distinguishing between
    internet entities that serve as conduits for transmission of
    copyrighted material and those who have an “interest in the
    copy itself”).
    
           Leonard proved direct infringement by Stemtech
    distributors. He demonstrated that he owned the copyrights
    to the infringed images, and that he did not authorize or
    license the use of his images in Stemtech’s advertising,
    marketing, and training materials. The materials containing
    his images ranged from webpages and PDFs to videos and a
    PowerPoint presentation promoting Stemtech products.9 This
    evidence provided a sufficient basis for a jury to reasonably
    conclude that the distributors directly infringed Leonard’s
    copyrights.
           Having determined that there was sufficient evidence
    to establish the predicate for secondary liability, we now turn
    to the claims against Stemtech for contributory and vicarious
    infringement.
    
                    1. Contributory Infringement
    
            “One infringes contributorily by intentionally inducing
    or encouraging direct infringement.” Grokster, 545 U.S. at
    930. To establish a claim of contributory infringement, a
    plaintiff must show: (1) a third party directly infringed the
           9
             Stemtech’s argument that Leonard failed to prove
    that Photo Researchers, his licensing agent at the time, did not
    license the images to Stemtech and/or its distributors, is, as
    the District Court noted, an improper attempt to shift the
    burden of an unproven defense of authorization.
    
    
    
    
                                  14
    plaintiff’s copyright; (2) the defendant knew that the third
    party was directly infringing; and (3) the defendant materially
    contributed to or induced the infringement. See Gershwin
    Publ’g Corp. v. Columbia Artists Mgmt., Inc., 
    443 F.2d 1159
    ,
    1162 (2d Cir. 1971) (“[O]ne who, with knowledge of the
    infringing activity, induces, causes or materially contributes
    to the infringing conduct of another, may be held liable as a
    ‘contributory’ infringer.”); see also Perfect 10, 508 F.3d at
    1171 (explaining that, “under Grokster, an actor may be
    contributorily liable for intentionally encouraging direct
    infringement if the actor knowingly takes steps that are
    substantially certain to result in such direct infringement”).
    
           The District Court appropriately denied Stemtech’s
    motion for a new trial on Leonard’s contributory infringement
    claim. As discussed above, there was sufficient evidence
    from which a jury could conclude that third parties, namely
    Stemtech’s distributors, directly infringed Leonard’s
    copyrights. Furthermore, the evidence shows that Stemtech
    knew of the distributors’ infringing activity. Stemtech itself
    created the materials containing Leonard’s images, provided
    the materials to its distributors, and required the distributors
    to use the materials. Thus, Stemtech knew of its distributors’
    infringing activities and plainly took “steps that [we]re
    substantially certain to result in such direct infringement.”
    Perfect 10, 508 F.3d at 1171-72.
    
           We also note that the jury had a basis to conclude that
    Stemtech knew that the images it provided to its distributors
    were copyrighted. The jury heard evidence that Stemtech had
    negotiated with Leonard for a limited-use license of one of
    his images in the HealthSpan magazine. From this evidence,
    the jury could infer that, despite knowing that Leonard’s
    images were copyrighted, Stemtech required its distributors to
    
    
    
    
                                  15
    use the images Leonard owned to promote Stemtech’s
    products and thereby materially contributed to or induced
    their infringement.10
    
           For these reasons, the District Court did not abuse its
    discretion in concluding that the jury’s contributory
    infringement verdict in favor of Leonard was not against the
    weight of the evidence and hence properly denied Stemtech’s
    motion for a new trial on Leonard’s contributory infringement
    claim.
    
                      2. Vicarious Infringement
    
            The District Court also correctly denied the motion for
    a new trial on Leonard’s vicarious infringement claim.
    Vicarious infringement occurs when one “profit[s] from
    direct infringement while declining to exercise a right to stop
    or limit it.” Grokster, 545 U.S. at 930. To establish vicarious
    infringement, a plaintiff must prove that the defendant had (1)
    the right and ability to supervise or control the infringing
    activity; and (2) a direct financial interest in such activities.
    Grokster, 545 U.S. at 930 & n.9; Am. Tel. and Tel. Co. v.
    Winback and Conserve Program, 
    42 F.3d 1421
    , 1441 (3d Cir.
    1994) (reciting similar standard).
    
          The requirement that a defendant have the right to
    supervise or control is not limited to traditional agency
           10
               Stemtech’s sole defense to its use was its
    compliance officer’s belief that the image was in the public
    domain because it appeared on the cover of Time. Even if her
    ignorance of the law were excusable, the fact that Stemtech
    entered into negotiations for a limited use of the images belies
    such ignorance.
    
    
    
    
                                   16
    relationships such as master-servant or employer-employee.
    Indeed, vicarious infringement liability has been imposed on
    a person or entity “even in the absence of an employer-
    employee relationship . . . if [the person or entity] has the
    right and ability to supervise the infringing activity.”
    Gershwin, 443 F.2d at 1162; Shapiro, Bernstein & Co. v. H.
    L. Green Co., 
    316 F.2d 304
    , 308 (2d Cir. 1963); see Napster,
    239 F.3d at 1022 (affirming extension, in copyright context,
    of     vicarious    liability   beyond      employer-employee
    relationship); see also Winback and Conserve Program, 42
    F.3d at 1441 (citing Gershwin and Shapiro, Bernstein). Nor
    does the control element require the existence of a formal
    contract between the defendant and the infringer. Rather, this
    element is satisfied where a “defendant’s ‘pervasive
    participation in the formation and direction’ of the direct
    infringer[’s]” activity supports a finding that “defendants
    were in a position to police the direct infringers.” Fonovisa,
    Inc. v. Cherry Auction, Inc., 
    76 F.3d 259
    , 262-63 (9th Cir.
    1996) (defendant flea market operator had right to exclude
    vendors and “controlled and patrolled” the premises) (quoting
    Gershwin, 443 F.2d at 1163)); see Gershwin, 443 F.2d at
    1163 (imposing vicarious liability even where defendant
    lacked contractual ability to control direct infringer); Shapiro,
    Bernstein, 316 F.2d at 306 (imposing vicarious liability where
    parties had licensing agreement).
    
           Cases from other circuits provide examples of conduct
    sufficient to demonstrate control. In Shapiro, Bernstein, for
    example, the Court of Appeals for the Second Circuit held a
    chain store company liable for the sale of infringing bootleg
    records by its licensee, who operated “the phonograph record
    department in . . . its stores,” because the company “retained
    the ultimate right of supervision over the conduct of the
    record concession and its employees.” 316 F.2d at 306, 308.
    
    
    
    
                                   17
    The court compared the situation to the numerous cases
    holding a “dance hall proprietor liable for the infringement of
    copyright resulting from the performance of a musical
    composition by a band or orchestra whose activities provide
    the proprietor with a source of customers and enhanced
    income[,] . . . whether the bandleader is considered, as a
    technical matter, an employee or an independent contractor.”
    Id. at 307 (collecting cases). In Napster, the Court of Appeals
    for the Ninth Circuit observed that the defendant, a file
    sharing program operator, “ha[d] the ability to locate
    infringing material listed on its search indices, and the right to
    terminate users’ access to the system.” 239 F.3d at 1024. At
    the other end of the “spectrum” is the example of a landlord-
    tenant case in which a “landlord leas[es] his property at a
    fixed rental to a tenant who engages in copyright-infringing
    conduct on the leased premises” and who generally does not
    have an obligation to police infringing conduct. Shapiro,
    Bernstein, 316 F.2d at 307-08.
    
           Like the chain store, dance-hall proprietor, and file-
    sharing program operator, Stemtech had the right and ability
    to control the infringing activities of its distributors.
    Stemtech created and provided marketing materials to its
    distributors, and required their use. It also had the contractual
    right to impose a range of disciplinary sanctions on
    distributors who violated its policies or engaged in illegal
    behavior, ranging from withholding compensation to
    terminating a distributorship agreement.            Additionally,
    Stemtech required its distributors to use “official STEMTech
    replicated templates” and websites that it controlled. J.A.
    2139. To the extent infringements occurred on what
    Stemtech asserts were unauthorized, independent websites,
    Stemtech still had the ability to induce compliance by
    distributors operating these websites by withholding
    
    
    
    
                                   18
    compensation and access to back office support.11 Stemtech
    thus had the “practical ability to police the third-party
    [distributors’] infringing conduct.” Perfect 10, 508 F.3d at
    1174. The evidence of this contractual and financial
    relationship between Stemtech and its distributors provided a
    basis for the jury to conclude that Leonard satisfied the right
    and ability to supervise or control element.
    
           Besides demonstrating control, a plaintiff must also
    show financial benefit to the defendant to prevail on a
    vicarious infringement claim. Shapiro, Bernstein, 316 F.2d at
    307 (courts should consider the interplay between the two
    elements). “Financial benefit exists where the availability of
    infringing material acts as a draw for customers.” Ellison v.
    Robertson, 
    357 F.3d 1072
    , 1078, 1079 (9th Cir. 2004)
    (internal quotation marks omitted). “There is no requirement
    that the draw be substantial.” Id. (internal quotation marks
    omitted).
    
           The jury could reasonably have credited the testimony
    from Stemtech officials indicating that images of stem cells
    lend legitimacy to products that purportedly enhance stem
    cell production and from this infer that the images could have
    drawn customers to buy the product, which would financially
    benefit Stemtech. Thus, there was sufficient evidence from
    which the jury could find that the financial benefit element
    was met. Because the verdict was not against the weight of
    the evidence, the District Court did not abuse its discretion in
    denying Stemtech’s motion for a new trial on Leonard’s
    vicarious infringement claim.
           11
             Stemtech’s ability to control its distributors is further
    reflected by the fact that when it asked a distributor to stop
    using the images, the distributor complied.
    
    
    
    
                                   19
                            C. Damages
    
                         1. The Jury Award
    
           Stemtech argues that the jury’s $1.6 million actual
    damages award was unconstitutionally and grossly excessive,
    and therefore should be reduced or vacated and remanded for
    a new damages trial. We will first discuss the methods for
    calculating actual damages under the Copyright Act, then
    review the District Court’s decision to permit Leonard’s
    damages expert to testify, and finally examine whether the
    award here was unconstitutionally or grossly excessive.
    
                  a. Actual Damages under § 504(b)
    
           Section 504 of the Copyright Act authorizes recovery
    of “the actual damages suffered by [the copyright owner] as a
    result of the infringement.” 17 U.S.C. § 504(b). Although
    the Act does not define “actual damages,” our sister circuits
    have explained that an actual damages award “looks at the
    facts from the point of view of the[] copyright owners; it
    undertakes to compensate the owner for any harm he suffered
    by reason of the infringer’s illegal act.” On Davis v. The
    Gap, Inc., 
    246 F.3d 152
    , 159 (2d Cir. 2001). These damages
    “are usually determined by the loss in the fair market value of
    the copyright, measured by the profits lost due to the
    infringement or by the value of the use of the copyrighted
    work to the infringer.” McRoberts Software, Inc. v. Media
    100, Inc., 
    329 F.3d 557
    , 566 (7th Cir. 2003); see Fitzgerald
    Publ’g Co. v. Baylor Publ’g Co., 
    807 F.2d 1110
    , 1118 (2d
    Cir. 1986) (“[T]he primary measure of recovery is the extent
    to which the market value of the copyrighted work at the time
    of the infringement has been injured or destroyed by the
    
    
    
    
                                  20
    infringement.”) (citing 3 Nimmer on Copyright § 14.02 at 14-
    6); Dash v. Mayweather, 
    731 F.3d 303
    , 312 (4th Cir. 2013)
    (quoting Fitzgerald, supra). Because the Act “should be
    broadly construed to favor victims of infringement,” On
    Davis, 246 F.3d at 164, “uncertainty will not preclude a
    recovery of actual damages if the uncertainty is as to amount,
    but not as to the fact that actual damages are attributable to
    the infringement,” 4 Nimmer on Copyright § 14.02[A], at 12-
    14; see, e.g., On Davis, 246 F.3d at 166 (explaining that the
    jury’s calculation of actual damages may not be based on
    “undue speculation” (internal quotation marks omitted));
    Sygma Photo News, Inc. v. High Soc. Magazine, Inc., 
    778 F.2d 89
    , 95 (2d Cir. 1985) (“Confronted with imprecision in
    the computation of expenses, the court should err on the side
    of guaranteeing the plaintiff a full recovery.”). Some
    uncertainty stems from the fact that the Copyright Act does
    not specify how damages should be calculated.             See
    Mayweather, 731 F.3d at 312. Case law, however, describes
    the permissible methods for determining damages.
    
            One method involves calculating the fair market value
    of the licensing fees “the owner was entitled to charge for
    such use.” On Davis, 246 F.3d at 165 (explaining that “[i]f a
    copier of protected work, instead of obtaining permission and
    paying the fee, proceeds without permission and without
    compensating the owner . . . the owner has suffered damages
    to the extent of the infringer’s taking without paying what the
    owner was legally entitled to exact a fee for”). Fair market
    value is often described as “the reasonable licensing fee on
    which a willing buyer and a willing seller would have agreed
    for the use taken by the infringer.” Id. at 167; see Jarvis v.
    K2 Inc., 
    486 F.3d 526
    , 534 (9th Cir. 2007) (applying
    standard); Mackie v. Rieser, 
    296 F.3d 909
    , 917 (9th Cir.
    2002) (noting that the “market value approach is an objective,
    
    
    
    
                                  21
    not a subjective, analysis”). Another method for calculating
    damages focuses on the plaintiff’s own past licensing fees.
    See, e.g., Jarvis, 486 F.3d at 534 (noting district court
    calculated damages using plaintiff’s past license). Stemtech
    asks us to use the past licensing fee method but cites no
    authority requiring the use of this method as opposed to the
    fair market value approach, and case law on this subject
    supports using the fair market value. See On Davis, 246 F.3d
    at 166 (“The question is not what the owner would have
    charged, but rather what is the fair market value.”);
    Mayweather, 731 F.3d at 312 (describing both calculation
    methods and noting “general[ ] accept[ance]” of fair market
    value approach). Because the jury was instructed about both
    methods for determining actual damages, and had an
    evidentiary basis for applying the fair market value through
    Sedlik’s expert testimony, there was no error in allowing the
    jury to consider evidence about damages based on the fair
    market value approach.
    
              b. Admission of Sedlik’s Expert Opinion
    
           Stemtech challenges the denial of its Daubert motion
    to exclude Sedlik’s testimony on various grounds, including,
    as relevant here, the basis for his opinions. In denying the
    motion, the District Court determined that Sedlik’s method
    for calculating Leonard’s actual damages using fair market
    value, as opposed to Leonard’s past licensing history, was
    reliable, as there is no requirement that actual damages be
    calculated based on a plaintiff’s own history of licensing fees.
    It also concluded that Sedlik had a factual basis for his
    calculation based upon the quotes he received for other
    photographs. Finally, the District Court concluded that there
    was a fit between the facts of the case and Sedlik’s damages
    calculation, and that challenges to the fit and reliability of the
    
    
    
    
                                   22
    fair market value method could be pursued via cross-
    examination.12
    
           Stemtech argues that the District Court erred in
    denying its Daubert motion, claiming that Leonard failed to
    lay a foundation for Sedlik’s lump sum damages figure
    because Sedlik’s testimony revealed “he relied on unverified
    information from Leonard’s counsel and did not make an
    independent determination of usages or infringements or
    calculate separate fees for the 92 alleged infringements.”
    Appellant’s Br. 57 (citing J.A. 1304-05, 1307-09, 1310-11,
    1316, 1320). We review the admission or exclusion of expert
    testimony for abuse of discretion. Pineda v. Ford Motor Co.,
    
    520 F.3d 237
    , 243 (3d Cir. 2008). “It is an abuse of
    discretion to admit expert testimony which is based on
    assumptions lacking any factual foundation in the record.”
    Stecyk v. Bell Helicopter Textron, Inc., 
    295 F.3d 408
    , 414
    (3d Cir. 2002).
    
            Sedlik adopted the recognized fair market value
    approach for calculating damages. To enable him to estimate
    the fair market value, he collected quotes from Getty Images
    and other photo licensing agencies and obtained a range of
    licensing fees for various uses similar to those involved in the
    case, averaged them, and then applied the average to the 92
    alleged instances of infringement. Stemtech’s disagreement
    with the calculation methodology and the underlying
    assumptions Sedlik made about which images and uses were
    similar to those in this case goes to the weight given to his
    testimony, rather than admissibility. See Breidor v. Sears,
           12
             We note that Stemtech failed to file objections to the
    Magistrate Judge’s memorandum order denying Stemtech’s
    Daubert motion.
    
    
    
    
                                  23
    Roebuck & Co., 
    722 F.2d 1134
    , 1138-39 (3d Cir. 1983)
    (“Where there is a logical basis for an expert’s opinion
    testimony, the credibility and weight of that testimony is to be
    determined by the jury, not the trial judge.”). Thus, the
    District Court appropriately denied the Daubert motion, and
    the jury was properly permitted to consider Sedlik’s
    testimony about damages.
    
                           c. Excessiveness
    
             Because we are deferential to a jury’s damages verdict,
    that verdict may be disturbed only if it is so grossly excessive
    that it shocks the judicial conscience, William A. Graham Co.
    v. Haughey, 
    646 F.3d 138
    , 142 (3d Cir. 2011) (Graham II), or
    if it is unconstitutionally excessive because it is predicated on
    an impermissible basis, Cortez v. Trans Union, LLC, 
    617 F.3d 688
    , 715-18 (3d Cir. 2010). With respect to a claim that
    a damage award is grossly excessive, our review is
    “exceedingly narrow” and our “responsibility [is] to review a
    damage award to determine if it is rationally based.” Id. at
    718. This standard “exists to ensure that a district court does
    not substitute its judgment of the facts and the credibility of
    the witnesses for that of the jury,” and is “even more pressing
    at the appellate level, where the judges have not had the
    opportunity to observe the trial.” Graham II, 646 F.3d at 143
    (internal quotation marks omitted). Thus, although we view
    the facts “in the light most favorable to” the defendant,
    Cortez, 617 F.3d at 719, “[a] jury’s damages award will not
    be upset so long as there exists sufficient evidence on the
    record, which if accepted by the jury, would sustain the
    award,” Thabault v. Chait, 
    541 F.3d 512
    , 532 (3d Cir. 2008).
    If a court determines that “the amount of the award is
    inconsistent with the evidence in a case,” it “must offer a new
    trial as a[] [conditional] alternative to a reduction in the award
    
    
    
    
                                   24
    in order to avoid depriving the plaintiff of his/her Seventh
    Amendment right to a jury trial.” Cortez, 617 F.3d at 716.
    
           Of course, the award must also be consistent with the
    governing law. The Copyright Act sets forth the available
    damages for a prevailing plaintiff. Stemtech correctly notes
    that the Act does not authorize recovery of punitive damages.
    See 17 U.S.C. § 504. Stemtech, however, wrongly asserts
    that the $1.6 million award includes punitive damages. To
    understand why, we will examine Sedlik’s expert damages
    opinion.
    
           As recounted above, Leonard’s expert, Sedlik,
    surveyed four stock photo agencies to obtain image licensing
    rates for uses similar to the infringing uses, and averaged the
    quotes to arrive at a per-use licensing fee of between
    $1,277.10 and $2,569.46. These fees factored in the image
    size, form of media, size of audience, geographical scope,
    placement, number of appearances, and length of the license.
    Sedlik selected a figure within this range, multiplied it by the
    92 infringements presented at trial, and arrived at a
    “benchmark” fair market value calculation of $215,767.65.
    
           In Sedlik’s opinion, this figure did not account for
    scarcity—the rarity of stem cell images—or exclusivity—that
    is, how Stemtech’s extensive use would be akin to an
    exclusive license that would eliminate or reduce licensing
    revenue from other sources and/or decrease the value of
    Leonard’s work. Sedlik testified that a “premium” or
    multiplier of three to five times the benchmark figure was
    warranted to account for the scarcity, and a multiplier of 3.75
    to 8.75 times the benchmark was appropriate to account for
    the exclusivity of Leonard’s images during the infringement
    period, which yielded a total estimated range of actual
    
    
    
    
                                  25
    damages of approximately $1.4 million to nearly $3 million.
    In addition to explaining that the benchmark figure needed to
    be enhanced because it did not capture the rarity or
    exclusivity of Leonard’s images, Sedlik informed the jury that
    “the damages that [he] come[s] up with can’t be of a kind that
    punish[es] the defendant.” J.A. 1307.
    
           Despite this comment, Stemtech claims the multipliers
    Sedlik applied are actually an impermissible penalty “akin to
    punitive damages, which are not recoverable under § 504(b)
    of the Copyright Act.”13 Grant Heilman Photography, 115 F.
    Supp. 3d at 527. In response, Leonard argues that these
    multipliers are not punitive but rather comprise elements of
    the fair market value of his images, and that the $215,767
           13
              In our view, there is a question as to whether
    Stemtech waived its challenge to Leonard’s use of a
    multiplier as part of his damages proof. Sedlik disclosed his
    reliance on a multiplier for scarcity and mentioned exclusivity
    as an additional relevant factor in his report, but Stemtech
    never challenged either factor in its Daubert motion.
    Moreover, it did not cross-examine Sedlik at trial on this topic
    and raised the multiplier issue for the first time in its motion
    for a new trial. Leonard, however, does not argue waiver, so
    he arguably “waived” his right to oppose Stemtech’s
    challenge to the jury award on this basis. See Freeman v.
    Pittsburgh Glass Works, LLC, 
    709 F.3d 240
    , 250 (3d Cir.
    2013) (“The doctrine of appellate waiver is not somehow
    exempt from itself. This means that a party can waive a
    waiver argument by not making the argument below or in its
    briefs.” (internal citation omitted)). Because the District
    Court had an opportunity to address the issue, and Leonard
    has not asserted waiver, we will address Stemtech’s challenge
    to Leonard’s use of a multiplier for scarcity and exclusivity.
    
    
    
    
                                  26
    benchmark was not the complete fair market value sum
    because Sedlik had not yet accounted for scarcity and
    exclusivity.
    
           The few district courts to consider the use of punitive
    multipliers have concluded that such use is improper under
    the Copyright Act because “[t]he value of what was illegally
    taken is not determined by multiplying it.” Stehrenberger v.
    R.J. Reynolds Tobacco Holdings, Inc., 
    335 F. Supp. 2d 466
    ,
    469 (S.D.N.Y. 2004) (internal quotation marks omitted);
    Grant Heilman Photography, 115 F. Supp. 3d at 526-27;
    Faulkner v. Nat’l Geographic Soc’y, 
    576 F. Supp. 2d 609
    ,
    617 (S.D.N.Y. 2008) (rejecting use of punitive multiplier for
    unauthorized use to calculate “actual damages” under §
    504(b)); Straus v. DVC Worldwide, Inc., 
    484 F. Supp. 2d 620
    , 648-49 (S.D. Tex. 2007) (crediting testimony of
    defendant’s expert Jeff Sedlik, who stated that “multipliers
    are used only when the parties include them in licensing
    agreements and are enforced as part of the contract,” but “are
    not used to determine the fair market value of a license at the
    time infringement occurs,” and noting that use of a multiplier
    would be punitive in that case).14 These courts rejected the
    use of a multiplier or “‘fee for unauthorized usage’” over and
    above what “would otherwise represent a fair and reasonable
    licensing fee for the infringed material” as a component of the
    actual damages calculation. Stehrenberger, 335 F. Supp. 2d
    at 467. We agree with the reasoning of these district courts
    that, under the Copyright Act, an actual damages award may
    not include such a punitive component. We also agree with
          14
              Cf. Bruce v. Weekly World News, Inc., 
    310 F.3d 25
    ,
    27 n.1 (1st Cir. 2002) (permitting multiplier for unauthorized
    use in a § 504(b) case where the parties agreed on the use of a
    multiplier).
    
    
    
    
                                  27
    Leonard that this case does not involve the use of a multiplier
    to penalize unauthorized use. Rather, the record demonstrates
    that the multiplier here was used to calculate fair market
    value.
    
            The jury had sufficient evidence to credit Sedlik’s
    opinion and conclude that the sum calculated from the stock
    photo agency rates did not represent a full calculation of the
    fair market value of Leonard’s images because the rates did
    not account for scarcity and exclusivity. Put differently,
    Sedlik’s fair market value calculation in this case had two
    components: the stock agency quotes and the adjustments to
    reflect the uniqueness of the images and the impact of
    Stemtech’s usage. The multipliers here reflected a premium
    that, according to Sedlik, the market would find acceptable
    given the scarcity and exclusivity of the images as compared
    to the images for which he had secured rates for comparative
    purposes. The unrebutted evidence here showed that the fair
    market value calculation was complete only after these
    additional factors were applied.
    
           Since Stemtech presented no evidence or methodology
    to cast doubt on the use of multipliers to account for factors
    relevant to a final fair market value, neither the District Court
    nor the jury had any basis to discount this aspect of Sedlik’s
    testimony. Because there is no evidence that the scarcity and
    exclusivity multipliers were punitive rather than valid factors
    for calculating fair market value, we cannot say that the
    verdict is based upon an improper consideration.15
           15
              Stemtech also argues that the jury award was
    unconstitutionally excessive under the Due Process Clause.
    Ordinarily, Due Process challenges are appropriately directed
    at punitive damages awards, which are intended to punish
    
    
    
    
                                   28
            Nor is the verdict grossly excessive. As noted above,
    courts are loath to substitute their judgment for that of the
    jury. While the award here was quite high, and perhaps
    surprising, we cannot say it lacked an evidentiary basis such
    that it “shock[s] the judicial conscience.” Graham II, 646
    F.3d at 143. The jury heard unrebutted expert testimony that
    provided it with the basis for the fair market value assigned to
    the images, which included both a benchmark for similar but
    less unique images and a range for a premium to reflect the
    rarity of Leonard’s image and its unusually widespread use in
    Stemtech’s materials. Sedlik provided a multiplier of three to
    five times the benchmark for scarcity and 3.75 to 8.75 times
    for exclusivity, and opined that the fair market value for use
    of the images would be determined by multiplying these
    figures by the benchmark sum of $215,767.65. The jury
    returned a verdict of $1.6 million, which represents a final
    sum at the lower end of Sedlik’s proposed range.
    
           The damages award was tethered to the record, which
    the jury was entitled to credit, and the jury was presented with
    no evidence that provided an alternative calculation. See
    Thabault, 541 F.3d at 532-33 (reviewing testimony of
    
    defendants, rather than at compensatory damages awards,
    which are simply intended to redress a plaintiff’s loss. See
    Cooper Indus. v. Leatherman Toll Grp., Inc., 
    532 U.S. 424
    ,
    432 (2001) (discussing distinction between punitive and
    compensatory awards for Due Process purposes); United
    States ex rel. Drakeford v. Tuomey, 
    792 F.3d 364
    , 387 (4th
    Cir. 2015) (“[T]he Due Process Clause does not apply to
    compensatory damage awards.”). Here, our conclusion that
    the damages award did not include a punitive component is
    fatal to Stemtech’s constitutional excessiveness claim.
    
    
    
    
                                  29
    damages expert, noting defendant’s attempts to discredit
    expert at trial, and concluding that “it is clear that if the jury
    accepted his calculation there was sufficient evidence to
    sustain [the award] as detailed by his testimony”). In light of
    our deferential standard of review, we conclude that the
    District Court did not abuse its discretion in denying a new
    trial on the basis of a grossly excessive jury verdict.
    
                         2. Infringer’s Profits
    
           In addition to authorizing recovery of actual damages,
    the Copyright Act allows a plaintiff to recover “any profits of
    the infringer that are attributable to the infringement and are
    not taken into account in computing the actual damages.” 17
    U.S.C. § 504(b). These are “profits earned not by selling an
    infringing product, but rather earned from the infringer’s
    operations that were enhanced by the infringement.”16
    William A. Graham Co. v. Haughey, 
    568 F.3d 425
    , 442 (3d
    Cir. 2009) (Graham I). Under the Act, to “establish[] the
    infringer’s profits, the copyright owner is required to present
    proof only of the infringer’s gross revenue, and the infringer
    is required to prove his or her deductible expenses and the
    elements of profit attributable to factors other than the
    copyrighted work.” 17 U.S.C. § 504(b). Though the Act
           16
             Direct profits may also constitute infringer’s profits
    where, for example, a defendant sells an infringing product.
    To the extent Leonard claims that the District Court failed to
    consider his evidence of direct profits from Stemtech’s sale of
    DVDs containing his images, this claim is waived as he
    conceded in his opposition to Stemtech’s summary judgment
    motion that he was not seeking such direct profits. Moreover,
    Leonard presented no evidence of any profits Stemtech made
    from DVD sales.
    
    
    
    
                                   30
    requires a copyright owner to present proof of the infringer’s
    “gross revenue” to support its initial burden, courts interpret
    the term to mean the gross revenue that is “reasonably related
    to the infringement.” Graham I, 568 F.3d at 443 (quoting On
    Davis, 246 F.3d at 160); see Polar Bear Prods., Inc. v. Timex
    Corp., 
    384 F.3d 700
    , 711-12 (9th Cir. 2004) (noting it would
    “make little practical or legal sense” to conclude a plaintiff
    satisfies his burden simply by “offer[ing] an overall gross
    revenue number . . . and sit[ting] back”); Taylor v. Meirick,
    
    712 F.2d 1112
    , 1122 (7th Cir. 1983) (“If General Motors
    were to steal your copyright and put it in a sales brochure,
    you could not just put a copy of General Motors’ corporate
    income tax return in the record and rest your case for an
    award of infringer’s profits.”).
    
            Under § 504(b), we use a “‘two-step framework for
    recovery of indirect profits.” Graham I, 568 F.3d at 442.
    First, the plaintiff must demonstrate a “causal nexus between
    the infringement and the [infringer’s] gross revenue,” or put
    differently, show that the infringement contributed to the
    infringer’s profits. Id. (alteration in original). Second, “once
    the ca[usal] nexus is shown, the infringer bears the burden of
    apportioning the profits that were not the result of
    infringement” and may adduce evidence of offsets permitted
    by the statute. Id. (internal quotation marks and citation
    omitted)
    
            The District Court granted Stemtech’s motion for
    summary judgment on Leonard’s request for infringer’s
    profits, concluding that the evidence he presented was too
    speculative for a jury to find that he was entitled to infringer’s
    
    
    
    
                                   31
    profits.17 To support his request for infringer’s profits,
    Leonard submitted proof of Stemtech’s total gross revenues.
    In addition, Leonard pointed to: (1) the regular use of his
    images in Stemtech marketing and training materials; (2) the
    requirement that Stemtech distributors use Stemtech’s
    replicated websites and marketing materials; and (3) his
    expert’s conclusion that “Stemtech’s many usages of
    Leonard’s photographs conclusively demonstrates that
    Stemtech exploited Leonard’s photograph[s] to promote its
    brand, to promote understanding of its company and products,
    to train and recruit distributors and to provide those
    distributors with tools which were used to maximize
    Stemtech’s profits.” J.A. 336 (internal quotation marks and
    emphasis omitted).
    
           None of this evidence shows how or why Leonard’s
    images, as opposed to other aspects of Stemtech’s marketing
    materials, influenced profits. As the District Court correctly
    found, this evidence did not “link customer decisions to
    purchase [Stemtech]’s product with [Stemtech]’s use of his
    [i]mages on its website, or in its videos, HealthSpan
    publication or other marketing materials, as opposed to any
    other reason why a customer might purchase those products.”
    J.A. 337. We agree with these observations and with the
    conclusion that, while “it is conceivable that the presence of
    the [i]mages in [Stemtech]’s materials added an air of
          17
             We review the District Court’s grant of summary
    judgment de novo, Alcoa, Inc. v. United States, 
    509 F.3d 173
    ,
    175 (3d Cir. 2007), applying the same standard as the District
    Court and viewing facts and making reasonable inferences in
    the non-movant’s favor. Hugh v. Butler Cty. Family YMCA,
    
    418 F.3d 265
    , 266-67 (3d Cir. 2005).
    
    
    
    
                                 32
    legitimacy to [Stemtech]’s product that might not have
    otherwise existed, and that the [i]mages could possibly have
    had some impact, whether consciously or subconsciously, on
    consumer purchasing decisions . . . [m]ere conceivability . . .
    is not enough. Instead, Plaintiff must identify evidence
    showing that the infringing use was ‘reasonably related to the
    infringement,’” and the evidence cited above amounted to
    mere speculation regarding the causal connection.18 J.A. 334.
          18
                For examples discussing infringer’s profits, see
    Mackie, 296 F.3d at 916 (insufficient evidence of causal
    nexus between “the Symphony’s infringing use of [artwork
    called] ‘The Tango’ and any Pops series revenues generated
    through the inclusion of the collage in the direct-mail
    literature,” in part due to the “virtually endless permutations
    to account for an individual’s decision to subscribe to the
    Pops series, reasons that have nothing to do with the artwork
    in question”); cf. Graham I, 568 F.3d at 442 (sufficient
    evidence of causal nexus in a case where the copyrighted
    materials were sample insurance proposals, and where
    plaintiff’s expert “identified client proposals issued by USI
    that included infringing language and then calculated the
    revenues obtained by USI from those clients [who had
    received] infringing proposal[s]” and USI personnel testified
    “that the written proposals . . . were an important part of the
    sales process . . . that . . . convinced [some clients] to
    purchase insurance through USI”); Polar Bear Prods., 384
    F.3d at 700, 712 (sufficient evidence of causal nexus where
    expert calculated revenue from trade shows at which Timex
    used unauthorized “PaddleQuest” materials to promote its
    Expedition line of watches to outdoor sports enthusiasts,
    including a continuous-loop extreme-kayaking film produced
    by plaintiff, where expert “concluded that approximately 10%
    to 25% of trade show sales are the result of excitement
    
    
    
    
                                  33
    There was no evidence upon which a reasonable juror could
    have calculated infringer’s profits.         Because none of
    Leonard’s evidence “create[d] a triable issue regarding
    whether the infringement at least partially caused the profits
    that the infringer generated as the result of the infringement,”
    Mackie, 296 F.3d at 911, we will affirm the District Court’s
    order granting summary judgment in Stemtech’s favor on
    Leonard’s request for infringer’s profits.
    
                           3. Prejudgment Interest
    
           Leonard argues that the District Court abused its
    discretion in denying his motion for prejudgment interest. An
    award of actual damages under the Copyright Act alone “does
    not mitigate harm caused by delay in making reparations—a
    harm the remedy of prejudgment interest is uniquely tailored
    to address. Simply put, prejudgment interest is a different
    remedy for a different harm.” Polar Bear Prods., 384 F.3d at
    718 (cited with approval in Graham II, 646 F.3d at 144-45).
    Prejudgment interest “mak[es] the claimant whole and
    prevent[s] unjust enrichment.” Graham II, 646 F.3d at 145.
    As we noted in Graham II, we “favor[ ] permitting
    prejudgment interest awards” to make a plaintiff whole in
    copyright cases, id. at 144 (emphasis omitted), because “as
    between a copyright owner and an infringer, the former has
    the stronger equitable claim to the time-value of income
    
    created by the booth promotion, of which the . . . materials
    were a substantial part”); Andreas v. Volkswagen of Am.,
    Inc., 
    336 F.3d 789
    , 791-97 (8th Cir. 2003) (sufficient nexus
    between Audi’s use of a copyrighted poem in a commercial
    and profits from the ad campaign, where evidence showed
    that the “infringement was the centerpiece of [the]
    commercial”).
    
    
    
    
                                  34
    derived from his creation,” id. at 145; see Booker v. Taylor
    Milk Co., 
    64 F.3d 860
    , 868 (3d Cir. 1995) (describing general
    presumption in favor of prejudgment interest awards). For
    this reason, our Court subscribes to “our usual rule,” Graham
    II, 646 F.3d at 145, that “a monetary award does not fully
    compensate for injury unless it includes an interest
    component,” Kansas v. Colorado, 
    533 U.S. 1
    , 10 (2001).
    
           Accordingly, “prejudgment interest is available in
    copyright cases at the District Court’s discretion, exercised in
    light of ‘considerations of fairness.’” Graham II, 646 F.3d at
    145-46 (affirming District Court’s grant of nearly $5 million
    in prejudgment interest) (quoting Pignataro v. Port Auth. of
    N.Y. and N.J., 
    593 F.3d 265
    , 274 (3d Cir. 2010)). In Booker,
    our Court ruled that it is an abuse of discretion for a district
    court to deny an award for prejudgment interest based on the
    conclusion that the actual damages award “alone wholly
    compensated Plaintiff, and that, because Plaintiff’s conduct
    contributed to an inflated [damages] claim, the equities
    weighed against prejudgment interest.” 64 F.3d at 868-69
    (emphasis in original) (awarding prejudgment interest on a
    back pay award). A district court “may exercise its discretion
    to depart from th[e] presumption [of awarding interest] only
    when it provides a justification that reasonably supports the
    departure.” Id. at 868. In other words, “[i]f prejudgment
    interest is denied, the District Court must explain why the
    usual equities in favor of such interest are not applicable.”
    Pignataro, 593 F.3d at 274.
    
           The District Court here denied prejudgment interest,
    explaining that it viewed such an award in this case as
    “inequitable and unfair” because the verdict “sufficiently
    compensated” Leonard “for the misappropriated value of his
    property” and “the award of interest would constitute a
    
    
    
    
                                  35
    windfall to Leonard.” J.A. 1737-38 (internal quotation marks
    omitted). In this regard, the District Court observed that the
    verdict represented a per-use licensing fee far greater than the
    per-use fees Leonard previously received for use of the
    infringed images. It also noted that awarding “sums on top of
    the $1.6 million already awarded is not necessary to ensure
    that . . . [Stemtech] is adequately deterred,” J.A. 1739, and
    emphasized that there was no jury finding of willful conduct
    on Stemtech’s part. As an additional ground for denying
    prejudgment interest, the District Court cited the difficulty of
    calculating the “appropriate amount” of interest due to
    numerous infringements. J.A. 1739.
    
            As in Booker, the District Court here was concerned
    with the high jury award and denied Leonard’s motion for
    prejudgment interest because it deemed the $1.6 million
    actual damages award sufficient to compensate him.
    However, prejudgment interest serves a different purpose and
    Leonard was “entitled” to recompense “for the loss of the use
    of the amount” of actual damages. Booker, 64 F.3d at 869;
    see Graham II, 646 F.3d at 145 (emphasizing that
    “recoup[ment] [of] the time-value of [a plaintiff’s] loss . . . is
    not . . . confined to the provision of just compensation,” but
    also prevents a “losing defendant” from “retain[ing] . . . a
    windfall in the form of an interest-free loan”). Therefore,
    denying prejudgment interest on the ground that the damages
    award sufficiently compensated Leonard constitutes legal
    error.
    
           Moreover, while we are not unmindful of the
    challenges related to calculating prejudgment interest in this
    case, with the 92 separate infringements that occurred on
    different dates, difficulty in calculating prejudgment interest
    is generally not a basis to deny an interest award. See, e.g.,
    
    
    
    
                                   36
    Hutchison v. Amateur Elec. Supply, Inc., 
    42 F.3d 1037
    , 1047
    (7th Cir. 1994) (holding that “uncertainty” in calculating
    prejudgment interest does not “defeat the presumption in
    favor of prejudgment interest” and “[i]t is not within the
    district court’s discretion to deny the whole award of interest
    because of . . . calculational ambiguities”); Williamson v.
    Handy Button Mach. Co., 
    817 F.2d 1290
    , 1299 (7th Cir.
    1987) (“No purpose would be served by allowing the
    wrongdoer to keep the entire time value of the money, just
    because the exact amount is subject to fair dispute. Once we
    know that [damages are] at least some minimum, it is safe to
    award interest on that amount.”). We note that a prevailing
    party moving for an award of prejudgment interest must
    provide the district court with sufficient information to
    calculate the interest or inform the court of the evidence it
    needs (such as information within the other party’s control) to
    make its application. Where a prevailing party fails to
    provide the district court with this information, such an award
    may be denied.19
    
    
          19
              An award may also be denied if the prevailing party
    engages in dilatory tactics during litigation or unnecessarily
    protracts the proceedings. Cf. City of Milwaukee v. Cement
    Div., Nat’l Gypsum Co., 
    515 U.S. 189
    , 196 (1995) (citing
    “undue delay” as “the most obvious example” justifying the
    denial of prejudgment interest (internal quotation marks
    omitted)); Gen. Motors Corp. v. Devex Corp., 
    461 U.S. 648
    ,
    656-57 (explaining that in the patent infringement context, “it
    may be appropriate to limit prejudgment interest, or perhaps
    even deny it altogether, where the patent owner has been
    responsible for undue delay in prosecuting the lawsuit”).
    Consistent with Devex, we note that “[t]here may be other
    circumstances in which it may be appropriate not to award
    
    
    
    
                                  37
           Here, the District Court stated that Leonard did not
    adequately address Stemtech’s assertion that the interest
    should be calculated based on “perhaps 92 different accrual
    dates and interest rates.” J.A. 1739. However, Leonard in
    fact offered to provide information on this topic if the Court
    deemed his proposed approach to use a single infringement
    date inadequate. Thus, Leonard was apparently ready to
    provide the information, including the dates on which he
    discovered each infringement. The District Court seems to
    have overlooked this offer, and therefore its views about the
    difficulty in calculation may have been misplaced.
    
           Because the District Court denied prejudgment interest
    based upon its view that Leonard was sufficiently
    compensated, its order “rest[ed] upon          . . . errant
    conclusion[s] of law.” Pineda v. Ford Motor Co., 
    520 F.3d 237
    , 243 (3d Cir. 2008). Moreover, because it found that
    calculating the interest was too difficult without fully
    considering the material Leonard was prepared to provide, its
    order rested on an erroneous finding of fact. We therefore
    will vacate the order denying an award of prejudgment
    interest and remand for the District Court to award
    prejudgment interest in the amount it deems appropriate
    under the governing law.20
    
    prejudgment interest,” but “[w]e need not delineate those
    circumstances in this case.” 461 U.S. at 657.
           20
              The District Court has discretion in selecting the
    appropriate interest rate and date(s) of infringement from
    which the interest begins to accrue. See Graham II, 646 F.3d
    at 146-51 (holding that prejudgment interest “may be
    awarded in appropriate cases from the initial accrual date” but
    leaving open the possibility that other cases may warrant
    
    
    
    
                                  38
                             D. Trial Issues
    
          Stemtech also asserts that it is entitled to a new trial
    based upon alleged improper conduct by Leonard’s counsel
    and the erroneous admission of certain evidence. We will
    address these contentions in turn.
    
                         1. Counsel’s Conduct
    
           Stemtech complains that Leonard’s counsel made
    comments during the trial that so prejudiced the jury that the
    District Court should have granted a new trial. Counsel’s
    conduct “constitutes reversible error” only where he or she
    engaged in “argument injecting prejudicial extraneous
    evidence,” Fineman v. Armstrong World Indus., Inc., 
    980 F.2d 171
    , 210 (3d Cir. 1992), such that the “improper
    statements . . . so pervade[d] the trial as to render the verdict a
    product of prejudice,” Draper v. Airco, Inc., 
    580 F.2d 91
    , 96
    (3d Cir. 1978). “Because the trial judge was present and able
    to judge the impact of counsel’s remarks, we defer to his
    assessment of the prejudicial impact.” Fineman, 980 F.2d at
    207; Draper, 580 F.2d at 94 (recognizing that the trial judge
    has “considerable discretion in determining whether conduct
    by counsel is so prejudicial as to require a new trial”). We
    thus review the decision to grant or deny a motion for a new
    trial based upon counsel’s conduct for abuse of discretion.
    Fineman, 980 F.2d at 206.
    
    alternate approaches); see also Kansas, 533 U.S. at 11
    (concluding special master did not err in determining that
    “considerations of fairness . . . supported the award of at least
    some prejudgment interest” (emphasis added) (internal
    quotation marks omitted)).
    
    
    
    
                                    39
           Stemtech first argues that Leonard’s counsel
    “repeatedly referred to Stemtech as an international,
    multinational or global corporation” to highlight the financial
    disparity between Leonard and Stemtech. Appellant’s Br. 45
    (emphasis omitted). Contrary to Stemtech’s assertions,
    reference to Stemtech’s international status was not a
    prominent “theme” throughout the trial, and thus even if
    improper, these isolated references do not constitute
    “argument injecting prejudicial extraneous evidence.”21
    Fineman, 980 F.2d at 210.
    
           Stemtech next argues that Leonard’s counsel used the
    wrong damages standard in his closing statement, but it did
    not object to these arguments during closing, and so the
    argument is waived.22 See Dunn v. HOVIC, 
    1 F.3d 1371
    ,
    1377 (3d Cir. 1993) (failure to make timely objection to
    statements of counsel during closing argument is a waiver to
    challenging them on appeal).
    
    
          21
              Similarly, Stemtech’s claim that Leonard’s counsel
    improperly insinuated that the company operated as a
    pyramid scheme is not a basis for a new trial. Not only were
    these references sporadic, but they also accurately describe
    Stemtech’s top-down business structure. In any event, the
    “pyramid” references do not make it “reasonably probable”
    that the jury’s verdict was influenced by these statements,
    Fineman, 980 F.2d at 207, and therefore do not warrant a new
    trial.
           22
              To the extent Stemtech’s arguments on this point
    merely repeat its attack on Sedlik’s expert testimony, such
    arguments fail as we have determined that his testimony was
    properly admitted.
    
    
    
    
                                  40
           Finally, Stemtech complains of “occasions that
    [Leonard’s counsel] argued unsupported issues[, which] are
    too numerous to discuss.” Appellant’s Br. 53. This broad
    statement does not suffice to preserve a claim of error on
    appeal. See Santomenno ex rel. John Hancock Trust v. John
    Hancock Life Ins. Co. (U.S.A), 
    768 F.3d 284
    , 292 n.3 (3d
    Cir. 2014) (discussing an issue in a single sentence may result
    in waiver); Long Hao Li v. Att’y Gen., 
    633 F.3d 136
    , 140 n.3
    (3d Cir. 2011) (“stray references” result in waiver); John
    Wyeth & Brother Ltd. v. CIGNA Int’l Corp., 
    119 F.3d 1070
    ,
    1076 n.6 (3d Cir. 1997) (raising an issue “in passing” without
    “squarely argu[ing it]” results in waiver).23
    
           To the extent Stemtech has provided any details
    concerning such alleged misconduct, none provides a basis
    for granting a new trial.        Stemtech’s contention that
    Leonard’s counsel improperly argued that Stemtech profited
    from the infringements “despite the absence of any such
    evidence,” Appellant’s Br. 54, is meritless because there was
    sufficient evidence to permit counsel to argue that Stemtech
    profited from the use of the images, including the testimony
           23
               Similarly, Stemtech’s argument that a new trial is
    warranted due to counsel’s “additional unsupported and
    improper statements and arguments,” Appellant’s Br. 55
    (capitalization omitted), that amounted to “pleas of pure
    passion . . . [and] blatant appeals to bias and prejudice,”
    Draper, 580 F.2d at 95, has been waived. Stemtech did not
    object to any of the summation statements it claims were
    directed to bias and passion. See Dunn, 1 F.3d at 1377. Even
    if Stemtech had preserved these claims of error, “at least for
    civil trials, improper comments during closing arguments
    rarely rise to the level of reversible error.” Id. (quotation
    marks, citation, and alteration omitted).
    
    
    
    
                                  41
    from Stemtech employees that depicting stem cells was
    important to selling products that purportedly enhanced stem
    cell production.
    
            Stemtech’s assertion that Leonard’s counsel
    improperly argued that the evidence of infringement
    presented at trial was “only the tip of the iceberg” also does
    not provide a basis for a new trial. According to Stemtech,
    Leonard, his counsel, and Sedlik each used language at the
    trial that suggested that there were likely additional acts of
    infringement by Stemtech and its distributors that were not
    presented at trial. To the extent Stemtech makes claims about
    what Leonard and Sedlik said during their testimony, this is
    not conduct of counsel and is irrelevant. To the extent
    Stemtech complains about counsel’s use of the phrase during
    his argument, such a stray remark does not make it
    “reasonably probable” that the verdict was influenced by
    these statements and thus does not warrant a new trial.
    Fineman, 980 F.2d at 207.24
           24
              The District Court excluded as speculative Sedlik’s
    opinion that the 92 infringing examples that would be
    presented at trial were only the “tip of the iceberg.” J.A. 638-
    40 (order granting motion in limine in part and barring “tip of
    the iceberg” statement and opinion regarding licensing fees
    for images not at issue in the case). To the extent Stemtech
    argues Sedlik’s testimony that “looking for usages on the
    internet is . . . an endless field of haystacks” violated this
    ruling, Stemtech objected and the District Court sustained the
    objection. J.A. 1381. Moreover, the District Court instructed
    the jury at the outset of trial that it should disregard evidence
    to which an objection was lodged when the objection is
    sustained, J.A. 766 (“If [an] objection is sustained, ignore the
    question.”), and jurors are presumed “to follow their
    
    
    
    
                                   42
           For these reasons, the District Court did not abuse its
    discretion in determining that none of Leonard’s counsel’s
    conduct warrants a new trial.
    
                        2. Evidentiary Rulings
    
           The final basis for Stemtech’s motion for a new trial is
    that the District Court erred in admitting certain evidence.
    Under Fed. R. Evid. 103 and Fed. R. Civ. P. 61, “a finding of
    reversible error may not be predicated upon a ruling which
    admits or excludes evidence unless a substantial right of the
    party is affected.” Becker v. ARCO Chem. Co., 
    207 F.3d 176
    , 180 (3d Cir. 2000) (internal quotation marks omitted);
    Goodman v. Pa. Tpk. Comm’n, 
    293 F.3d 655
    , 676 (3d Cir.
    2002) (“A motion for a new trial should be granted where
    substantial errors occurred in admission or rejection of
    evidence.”). In the context of evidentiary issues raised in
    support of a request for a new trial, “particular deference is
    appropriate where the decision to grant or deny a new trial
    rested on the district court’s evidentiary ruling that itself was
    entrusted to the trial court’s discretion.” Becker, 207 F.3d at
    180 (internal quotation marks omitted).
    
           We review preserved evidentiary objections for abuse
    of discretion. McKenna v. City of Phila., 
    582 F.3d 447
    , 460
    (3d Cir. 2009). Where, however, a party failed to object to
    the admission of evidence before the District Court, we deem
    that objection waived on appeal. See Lloyd v. HOVENSA,
    LLC, 
    369 F.3d 263
    , 272-73 (3d Cir. 2004) (observing that “it
    is inappropriate for an appellate court to consider a contention
    
    instructions.”   Richardson v. Marsh, 
    481 U.S. 200
    , 211
    (1987).
    
    
    
    
                                   43
    raised on appeal that was not initially presented to the district
    court”) (internal quotation marks omitted); Waldorf v. Shuta,
    
    142 F.3d 601
    , 629 (3d Cir. 1998) (failure to object at trial
    results in waiver).
    
           Stemtech argues that the District Court abused its
    discretion in admitting numerous exhibits and testimony,
    which it claims warrant granting a new trial. To the extent
    Stemtech argues that the District Court erred in admitting
    certain evidence that lacked a proper foundation, Stemtech
    has waived such an objection because the District Court
    clearly ruled that foundation objections needed to be raised
    when the allegedly objectionable exhibits were offered at
    trial, and Stemtech failed to lodge a contemporaneous
    objection.
    
           As for the 92 exhibits depicting infringing uses of
    Leonard’s images, Stemtech objected to the admission of
    these exhibits on relevance and foundation grounds. The
    District Court properly overruled the foundation objections,
    as a foundation for the documents was laid. First, Leonard
    explained how he found the items and identified the indicia
    within the items that showed their connection to Stemtech.
    Second, Leonard testified that he contacted certain website
    owners and learned they were Stemtech distributors. Third,
    Stemtech failed to provide a basis to question whether the
    websites embodied in the screenshots were connected to the
    Stemtech enterprise. In addition to the fact that the contents
    of the screenshots showed their connections with Stemtech,
    Dr. Rivka Rachel, a Stemtech distributor, testified about
    several Stemtech websites that were captured in the
    Leonard’s screenshots.
    
    
    
    
                                   44
           Furthermore, the exhibits were relevant because, as the
    District Court stated, they are “part of what is at issue in
    terms of the allegations of infringement,” since they reflect
    the infringements Leonard discovered online. J.A. 850. For
    these reasons, the District Court properly admitted the
    documents embodying the infringing images.
    
          We have reviewed all of Stemtech’s other arguments
    concerning its evidentiary objections and conclude that the
    arguments have either been waived or are meritless because
    the admission of the evidence about which Stemtech
    complains did not affect its substantial rights.
    
          For these reasons, none of Stemtech’s evidentiary
    arguments warrants a new trial.
    
                          E. Fee Disputes
    
          Finally, we address the two attorneys’ fees disputes:
    one arising from a discovery-related award and the second
    stemming from the second lawsuit Leonard filed against
    Stemtech.
    
                   1. Discovery Violation Award
    
          Stemtech challenges the District Court’s order granting
    Leonard fees and costs incurred in taking a Stemtech
    employee’s deposition.25 Fed. R. Civ. P. 37(c)(2) provides:
          If a party fails to admit what is requested under
          Rule 36 and if the requesting party later proves .
          25
             We review the decision to impose sanctions for
    abuse of discretion. Bowers v. Nat’l Collegiate Athletic
    Ass’n, 
    475 F.3d 524
    , 538 (3d Cir. 2007).
    
    
    
    
                                 45
           . . the matter true, the requesting party may
           move that the party who failed to admit pay the
           reasonable expenses, including attorney’s fees,
           incurred in making that proof. The court must
           so order unless:
    
                   (A) the request was held objectionable
           under Rule 36(a);
                   (B) the admission sought was of no
           substantial importance;
                   (C) the party failing to admit had a
           reasonable ground to believe that it     might
           prevail on the matter; or
                   (D) there was other good reason for the
           failure to admit.
    
    Fed. R. Civ. P. 37(c)(2).
    
           Leonard sought to prove that Stemtech controlled its
    distributors through, among other things, the use of Requests
    for Admission under Fed. R. Civ. P. 36.26 To this end,
    Leonard sent Requests for Admission to Stemtech “seeking
    Stemtech’s admission that it provided its independent
    distributors with internet sub-domains to the official Stemtech
    owned domain.” Appellee’s Br. 65 (citing J.A. 351-69).
    Stemtech denied these requests.
    
          Leonard later deposed George Tashjian, Stemtech’s
    Information Technology Director. Tashjian testified that (1)
    he had never seen the requests for admission, nor had he been
    asked for his input into the answers; (2) Stemtech provided
           26
             Rule 36 provides a tool to streamline the proof of
    controverted facts. See Fed. R. Civ. P. 36.
    
    
    
    
                                  46
    distributors with internet sub-domains associated with
    Stemtech’s parent website, stemtechbiz.com; and (3) the
    requests for admission concerning Stemtech’s ownership of
    the domain that Stemtech denied were, in fact, true and
    should have been admitted. Tashjian’s testimony therefore
    established that Stemtech wrongly denied certain requests for
    admissions.
    
           Nearly two years later, Leonard moved for an award of
    fees and costs incurred in taking Tashjian’s deposition. See
    Fed. R. Civ. P. 37(c)(2). The District Court granted the
    motion in part, awarding 50% of the $3,048.30 requested,
    because only a portion of the deposition pertained to the
    control issue.
    
            Stemtech’s conduct falls within the ambit of Rule
    37(c)(2) and, despite Stemtech’s argument that the sanctions
    motion was not expeditiously filed and the requested
    admission pertained to a matter of no substantial importance
    under Rule 37(c)(2)(B), this exception to the mandatory
    imposition of sanctions does not apply. Leonard sought the
    admission of facts concerning Stemtech’s control over its
    distributors’ websites, which was a crucial component of
    Leonard’s vicarious and contributory infringement claims.
    Because this issue was central to Leonard’s secondary
    infringement claims, Stemtech had no factual basis for
    denying the request, and Leonard incurred expenses to prove
    these facts during Tashjian’s deposition, the District Court did
    not abuse its discretion in awarding sanctions to Leonard.
    See Yoder & Frey Auctioneers, Inc. v. EquipmentFacts, LLC,
    
    774 F.3d 1065
    , 1074-75 (6th Cir. 2014) (holding that the
    district court did not abuse its discretion in awarding nominal
    Rule 37(c)(2) sanctions and costs where withholding party
    
    
    
    
                                  47
    “did not have reasonable grounds to believe it might
    prevail”).
    
             2. Stemtech’s Prevailing Party Fee Request
    
           We are also asked to review a fee ruling arising from
    Leonard’s second lawsuit against Stemtech, alleging new
    infringing uses he discovered while this case was pending.
    The District Court granted Stemtech’s motion for summary
    judgment in the second case. As the prevailing party in the
    second suit, Stemtech moved for an award of attorney’s fees
    pursuant to 17 U.S.C. § 505. The District Court denied the
    motion.
    
            The Copyright Act permits a discretionary award of
    attorneys’ fees to the prevailing party in a copyright lawsuit.
    17 U.S.C. § 505; Fogerty v. Fantasy, Inc., 
    510 U.S. 517
    , 533
    (1994) (noting § 505 “clearly connotes discretion” and a
    district court may not “award[] attorney’s fees as a matter of
    course”). Several factors guide the exercise of discretion in
    this context, including “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 534
    n.19 (quoting Lieb. v. Topstone Indus., Inc., 
    788 F.2d 151
    ,
    156 (3d Cir. 1986)). The Supreme Court recently reaffirmed
    that § 505 fee awards are discretionary and placed extra, but
    not controlling, weight on the “objective unreasonableness”
    factor, and reminded courts to consider the totality of the
    circumstances and make a “particularized, case-by-case
    assessment.” Kirtsaeng v. John Wiley & Sons, Inc., 136 S.
    Ct. 1979, 1985 (2016) (quoting Fogerty, 510 U.S. at 527, 534
    n.19).
    
    
    
    
                                  48
            The District Court did not abuse its discretion when it
    denied Stemtech’s fee motion in the second suit. The District
    Court applied the Fogerty factors and determined that there
    was no evidence that Leonard’s decision to file the second
    suit was objectively unreasonable, frivolous, or in bad faith
    because “Leonard ha[d] reason to believe Stemtech was
    engaged in ongoing and new infringement, that was not the
    subject of [the first suit],” and accordingly “had a non-
    sanctionable, non-frivolous basis to file [the second suit].”
    J.A. 40. Despite the temporal proximity between the filing of
    the second suit and unfavorable rulings in this case, where
    Leonard was denied leave to amend his complaint and the
    ability to seek infringer’s profits and statutory damages, the
    District Court appropriately adopted the Magistrate Judge’s
    findings that “the filing of [the second suit] was not an end-
    run around” these adverse rulings in the first suit but rather
    stemmed from Leonard’s belief that Stemtech continued to
    engage in new infringing activity, and thus was not “a bad
    faith attempt to re-litigate issues that have been decided
    [against Leonard] in [the first suit].” J.A. 40-41 (internal
    quotation marks omitted). Because it had a factual basis for
    concluding that the filing of the second suit was objectively
    reasonable, the District Court acted within its discretion in
    denying Stemtech’s fee motion.
    
                                  III
    
           For the foregoing reasons, we will affirm the District
    Court’s rulings on all issues except for its order denying
    Leonard’s motion for prejudgment interest, which we will
    vacate and remand for further proceedings.
    
    
    
    
                                  49
    

Document Info

DocketNumber: 15-3198

Filed Date: 8/24/2016

Modified Date: 8/24/2016

Authorities (57)

General Motors Corp. v. Devex Corp. , 461 U.S. 648 ( 1983 )

Richardson v. Marsh , 481 U.S. 200 ( 1987 )

Fogerty v. Fantasy, Inc. , 510 U.S. 517 ( 1994 )

Milwaukee v. Cement Div., National Gypsum Co. , 515 U.S. 189 ( 1995 )

Cooper Industries, Inc. v. Leatherman Tool Group, Inc. , 532 U.S. 424 ( 2001 )

Kansas v. Colorado , 533 U.S. 1 ( 2001 )

LONG HAO LI v. Attorney General of US , 633 F.3d 136 ( 2011 )

Bruce v. Wkly World News, Inc , 310 F.3d 25 ( 2002 )

William A. Graham Co. v. Haughey , 646 F.3d 138 ( 2011 )

Shapiro, Bernstein & Co., Inc. v. H. L. Green Company, Inc.,... , 316 F.2d 304 ( 1963 )

Gershwin Publishing Corporation v. Columbia Artists ... , 443 F.2d 1159 ( 1971 )

dorothy-l-draper-individually-and-as-general-administratrix-and , 580 F.2d 91 ( 1978 )

Darrell Taylor, D/B/A Darrell Taylor Topographic Charts v. ... , 712 F.2d 1112 ( 1983 )

Francis and Barbara Breidor v. Sears, Roebuck and Co. And ... , 722 F.2d 1134 ( 1983 )

sygma-photo-news-inc-plaintiff-appellee-cross-appellant-v-high-society , 778 F.2d 89 ( 1985 )

Lloyd Lieb, Trading as Specialized Cassettes v. Topstone ... , 788 F.2d 151 ( 1986 )

fitzgerald-publishing-co-inc-cross-appellee-v-baylor-publishing-co , 807 F.2d 1110 ( 1986 )

Beatrice Williamson, Plaintiff-Appellee--Cross-Appellant v. ... , 817 F.2d 1290 ( 1987 )

robert-l-williamson-liberty-mutual-insurance-company-intervenor-v , 926 F.2d 1344 ( 1991 )

Elliot Fineman the Industry Network System, Inc. v. ... , 980 F.2d 171 ( 1992 )

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