Olive v. General Nutrition Centers, Inc.

California appellate court partially reverses prior ruling on rehearing and affirms denial of attorneys’ fees on right of publicity claim, holding trial court has discretion under statute to determine that neither party prevailed if verdict is not lopsided in either party’s favor.

Model and actor Jason Olive sued General Nutrition Centers Inc., an international retailer and manufacturer of vitamins and nutritional supplements, for misappropriation of likeness and unjust enrichment. Olive claimed GNC continued using his likeness in its advertising after GNC’s contractual right to do so had expired. GNC admitted liability for the unauthorized use of Olive’s likeness in violation of California’s right of publicity statute, and the case was tried before a jury on the issue of damages. After the jury awarded Olive actual and emotional distress damages but no restitutionary or punitive damages, the trial court denied both sides’ motions for “prevailing party” attorneys’ fees and costs under the statute. Olive and GNC each appealed the judgment and the order denying prevailing party attorneys’ fees. 

The jury ultimately awarded Olive $1.123 million, consisting of $213,000 in actual damages and $910,000 in emotional distress damages. However, the jury found Olive had failed to prove that any of GNC’s profits were attributable to the right of publicity violation and therefore denied any restitutionary damages. The jury also denied Olive any punitive damages, finding that GNC had not acted with malice or fraud. The trial court viewed the award as a middle ground where the jury accepted neither side’s recommendation, amounting to a tie. It therefore found there was no prevailing party in denying the two motions for statutory attorneys’ fees, noting that both parties were “visibly disappointed” after the jury rendered its verdict. 

The Court of Appeal rejected Olive’s request for a reversal of the verdict based on his argument that the lower court failed to provide certain jury instructions relating to the calculation of profits attributable to the alleged infringement. Olive also argued that the trial court abused its discretion in excluding two of his experts from testifying at trial. The trial court granted GNC’s motion in limine to preclude these two experts from testifying, finding that they employed a “nearly data free and methodologically primitive” analysis that contained “no science or data.” The appellate court agreed that the experts’ methodologies were flawed and rejected Olive’s arguments. The court concluded the trial court had acted well within its “gatekeeper” discretion by excluding these two experts from testifying. 

Finally, both parties argued the trial court had abused its discretion in denying the cross-motions for prevailing party attorneys’ fees under the right of publicity statute. The trial court had concluded there was no prevailing party, as the jury’s award of approximately $1.1 million in actual and emotional distress damages represented a middling sum or “tie” between Olive’s recommendation of more than $100 million in actual, emotional distress, restitutionary and punitive damages and GNC’s recommendation of only a $4,800 licensing fee. The Court of Appeal originally agreed with Olive and remanded to determine an appropriate fee award, but it subsequently granted GNC’s request for rehearing on that issue. After a second review, the appellate court held there was no abuse of discretion in the lower court’s decision. 

The Court of Appeal began by noting that California’s right of publicity statute does not define the term “prevailing party,” but that courts had concluded a rigid definition should not be used. Instead, California courts determine prevailing status based on an evaluation of whether a party prevailed on a practical level, including factors such as the extent to which each party realized its litigation objectives. The court then took guidance from the Supreme Court of California decision in Hsu v. Abbara, which held that, in deciding whether there is a prevailing party on a contract claim, the trial court should compare the relief awarded with the parties’ demands and litigation objectives as disclosed by the pleadings, trial briefs, opening statements and similar sources, and should make the determination by comparing the extent to which each party succeeded and failed in its contentions.

The court in Olive concluded that the test outlined in Hsu provides a workable approach for determining whether neither party prevailed in right of publicity cases. Applying the test, the court reasoned that neither Olive nor GNC had obtained an unqualified win, so the trial court was free to view the judgment as a mixed result and to exercise its discretion in determining whether one party prevailed or neither did because neither achieved its practical litigation objectives. In Olive’s case, the court found it significant that, when factoring in his punitive damages request, Olive had recovered less than 1 percent of his litigation objective. The appellate court therefore held there was no abuse of discretion in the trial court’s conclusion that neither Olive nor GNC prevailed based on their own trial objectives.