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A Boston federal judge has awarded a wine association close to $680,000 in attorney fees and expenses after it won a nearly five-year fight against a Massachusetts state agency over a state wine shipment law. Judge Rya Zobel’s June 8 ruling in Family Winemakers of California v. Jenkins awarded $615,873.09 in fees and $62,561.91 in expenses to the plaintiffs, victors in a challenge to the Massachusetts statute, which banned large wineries from directly shipping to the state’s consumers. Kirkland & Ellis of Chicago and Boston-based Rubin & Rudman represented the wine association and two individual plaintiffs. The state law allowed only wineries that produce 30,000 gallons or less of grape wine per year to sell directly to Massachusetts consumers. In January 2010, the U.S. Court of Appeals for the 1st Circuit ruled that the law violated the Constitution’s commerce clause, which limits the states’ ability to restrict interstate trade. In that ruling, Chief Judge Sandra Lynch wrote, “We hold that [the statute] violates the Commerce Clause because the effect of its particular gallonage cap is to change the competitive balance between in-state and out-of-state wineries in a way that benefits Massachusetts’s wineries and significantly burdens out-of-state competitors.” She noted that “Section 2 of the Twenty-first Amendment does not exempt or otherwise immunize facially neutral but discriminatory state alcohol laws like [this] from scrutiny under the Commerce Clause.” Zobel’s award differed from both the plaintiffs’ request for $1,524,017 in attorney fees and $96,339 in expenses and the defense-side argument for a total of $362,446 in fees and expenses. In the ruling, Zobel wrote that plaintiffs’ fee requests for several types of work were excessive. “Counsel… spent an unreasonable amount of time on various phases of the litigation,” she wrote. Zobel concluded that the plaintiffs sought unreasonable reimbursement for four different types of work, including lawyer conferencing time, work on the summary judgment motion, preparing for the 1st Circuit oral argument and preparing the fee motion. Those four categories counted for 2,247.96 of the 4,058.5 claimed hours, Zobel wrote. She deemed that 1,179.48 hours — 52% — was reasonable for those categories of the work. The judge cut the rest of the plaintiffs’ requested billable hours by 24% to account for what she considered unreasonable billing, such as paralegal time spent on clerical tasks. She ultimately awarded the plaintiffs 2,555.49 of their requested billable hours. In her analysis of the billable rates, Zobel wrote that the $559.58 hourly rate for the lead plantiffs’ lawyer, Tracy Genesen, a San Francisco Kirkland & Ellis partner “is not unreasonable given her particular expertise in the area of wine law.” Still, Zobel cut her blended rate by 10% to $503.62 because “the use of her 2010 rate for all billed hours…creates a windfall for plaintiffs, as it far exceeds the rate at which the majority of her work was invoiced to the client.” “I reduce her blended rate by 10% so that she is compensated fairly, but not excessively, for the delay in payment,”Zobel wrote. Nor did she allow $6,832.08 in overtime and meal costs, and she trimmed $33,997.85 in postage, telephone, and document related cost requests by 25% due to “unnecessary use of messenger and overnight mailing.” The judge declined the plaintiffs’ request for travel expenses because they were not itemized. Genesen of Kirkland said that the case was significant in that it “was the first successful challenge to a facially neutral gallonage cap statute.” The case is over, but the battle over whether Massachusetts residents can buy wine over the Internet is not, Genesen said. Despite Zobel’s injunction barring enforcement of the state law and the 1st Circuit’s endorsement of that ruling, the Massachusetts legislature has yet to pass a bill with regulations that would allow most wine retailers to make Internet sales to Massachusetts residents, she said. In a written statement Paul Kronenberg, the president of Family Winemakers, said, “This case was a very difficult undertaking and was handled adroitly and professionally by our attorneys at Kirkland & Ellis over an almost five year time frame.” The Massachusetts Alcoholic Beverages Control Commission, of which the named defendants are officials, did not respond to requests for comment. The Massachusetts Attorney General’s office, which represented the commission, referred questions to its client. Gerald Caruso, a litigator at Rubin & Rudman, said his research shows that Genesen’s fee award is among the highest awarded in the District of Massachusetts in a civil rights case. Sheri Qualters can be contacted at [email protected].

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