The Franchise Memorandum

The United States District Court for the Western District of Missouri awarded H&R Block Tax Services, which Gray Plant Mooty represented, $481,184.57 in attorneys' fees and costs incurred in connection with litigation arising out of Block's termination of its largest franchisee in Puerto Rico. H&R Block Tax Servs. LLC v. Acevedo-Lopez, 2014 U.S. Dist. LEXIS 139269 (W.D. Mo. Oct. 1, 2014). The court had previously awarded Block more than $1.3 million in damages and issued a permanent injunction enforcing the franchisee's posttermination obligations.

The court found that the time spent by Block's counsel in connection with the district court proceedings was reasonable and that Block's billing records reflected "appropriate delegation of tasks to the level at which they could be handled most economically." It also found that the complexity of the litigation, the importance of the case in terms of the amount of money involved and the need to protect the integrity of the franchise system, and the results obtained (success on all claims and counterclaims in the case) warranted awarding the full amount requested by Block for attorneys fees' and costs incurred at the district court level. The court did, however, deny Block's request for fees in connection with an interlocutory appeal challenging the district court's denial of Block's motion at the beginning of the case for a preliminary injunction. Although the court of appeals had vacated the order denying preliminary relief, Block was granted summary judgment, including for a permanent injunction, on the same day that the court of appeals issued its mandate.