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Sokoloff v. General Nutrition Companies

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY


May 21, 2001

ERIC SOKOLOFF, ET AL., PLAINTIFFS,
v.
GENERAL NUTRITION COMPANIES, INC., ET AL., DEFENDANTS.

The opinion of the court was delivered by: Simandle, District Judge

OPINION

This claim for attorney's fees and costs is before the Court on the motion of defendants, GNC Franchising, Inc., and General Nutrition Companies, Inc., who seek such fees and costs pursuant to Rule 54(d), Fed. R. Civ. P. The plaintiffs' claims in the underlying case, which would have required this Court to interpret the terms of a Franchising Agreement between the parties, were dismissed on August 18, 2000, when this Court granted plaintiffs' motion to voluntarily dismiss the action. By consent of the parties, the claims were dismissed with prejudice, subject to an agreement that defendants were not barred from seeking counsel fees arising from the Franchise Agreement in this or another action, and plaintiffs were not barred from raising any appropriate defenses to such an action. Defendants GNC Franchising, Inc. ("GNC Franchising"), and General Nutrition Companies, Inc. ("GNCI") (collectively, the "GNC Defendants"), now move for an award of attorney's fees and litigation-related costs pursuant to Rule 54(d)(2)(A).

The principal issue to be addressed is whether a defendant, which has asserted no counterclaim for attorney's fees and costs, may nonetheless invoke Rule 54(d)(2)(A) to recover same as contractual damages under the parties' contractual fee-shifting provision, or whether, alternatively, the defendants' remedy must lie in a separate action for contractual damages under relevant state law, in this case the law of New Jersey. For the reasons stated herein, the Court finds that, under the applicable state law, defendants' claim for contractual fee-shifting must be pleaded and tried as an item of contractual damages and not by way of motion under Rule 54(d)(2)(A), and the motion of the GNC Defendants will be dismissed without prejudice.

I. BACKGROUND

Plaintiffs Eric and Heidi Sokoloff own and operate a General Nutrition Center store in Delran, New Jersey, selling vitamins, mineral supplements, and other health related products manufactured by defendant GNCI, pursuant to a franchising agreement with GNC Franchising. On February 9, 2000, plaintiffs filed a complaint in this Court against the GNC Defendants and Rite Aid Corporation ("Rite Aid") and moved for a preliminary injunction, alleging that the GNC Defendants breached their franchise agreement with plaintiffs by allowing defendant Rite Aid to sell PharmAssure vitamins manufactured by GNC within plaintiffs' "protected territory," as set forth in the franchise agreement. On March 15, 2000, the GNC Defendants filed their opposition and a cross-motion to transfer venue to the Eastern District of Pennsylvania. The primary dispute between plaintiffs and the GNC Defendants was the meaning of contractual language in the Franchise Agreement and whether the sale of PharmAssure brand products by Rite Aid within the protected area violated that agreement.

On March 31, 2000, this Court issued an opinion in Kazmierski v. General Nutrition Co., Inc., No. 99-5281, slip op. (D.N.J. Mar. 31, 2000)(Simandle, J.), which interpreted a franchise agreement identical to the one at issue in the instant case, and permitted the sale of PharmAssure brand products within the Kazmierski franchisee's protected territory. Id. at 8-9. On April 6, 2000, the GNC Defendants transmitted a copy of the Kazmierski opinion to plaintiffs and requested that they withdraw their motion for a preliminary injunction. (Defs.' Br. at 2.) Depositions were taken on April 11, 2000, and the GNC Defendants again requested that the motion be withdrawn. (Defs.' Br. at 2-3.) Plaintiffs declined both requests. On April 20, 2000, the GNC Defendants withdrew their motion to transfer venue. On May 4, 2000, pursuant to a Court approved agreement, the GNC Defendants filed a supplemental brief, emphasizing plaintiffs' inability to meet their burden of proof, in lieu of an evidentiary hearing. No opposition was filed by plaintiffs. On May 22, 2000, this Court heard oral arguments and denied plaintiffs' motion for a preliminary injunction against the GNC Defendants. An opinion and order were issued on June 12, 2000, granting defendant Rite Aid's motion to dismiss and finding that plaintiffs failed to prove a likelihood of success on the merits or irreparable harm to them if the preliminary injunction were not granted, and that the GNC Defendants would be harmed by the granting the preliminary injunction motion.

On July 20, 2000, plaintiffs submitted a motion to voluntarily dismiss their claims against the GNC Defendants without prejudice, pursuant to Rule 41(a)(2), Fed. R. Civ. P. The GNC Defendants objected to the plaintiffs' motion to voluntarily dismiss their claims without prejudice unless attorney's fees were included as a condition of the dismissal order. After extensive negotiations between the parties, plaintiff agreed to voluntarily dismiss their claims with prejudice. On August 18, 2000, prior to granting plaintiffs' Rule 41(a)(2) motion, this Court had a telephone conference with all counsel, during which the issue of attorney's fees was discussed:

MR. SCHUMACHER: Your Honor, Mr. Soffian has agreed to dismiss the plaintiffs' case with prejudice. The GNC defendants have agreed that the case can be dismissed with prejudice provided it's clearly understood that the GNC defendants are not waiving or otherwise compromising their right to seek counsel fees or any other remedies that may be available to them in this action or any other action.

THE COURT: Okay. Mr. Soffian, do you agree?

MR. SOFFIAN: I agree. And it's also conditioned upon the fact that plaintiffs are not prevented from raising any factual, legal or procedural defenses available to them in this ir another litigation.

THE COURT: All right. In other words, plaintiffs are not conceding that any attorney fees are available, is that correct?

MR. SOFFIAN: That's correct.

MR. SCHUMACHER: As I understand what Mr. Soffian is saying, the plaintiffs are not waiving any of these rights with respect to defenses to the counsel fees or any other future remedies which GNC defendants may pursue.

MR. SOFFIAN: Or whatever other remedies plaintiffs might pursue.

MR. SCHUMACHER: Judge, I have a question on any remedies the plaintiff might pursue. The plaintiff is dismissing their case with prejudice.

MR. SOFFIAN: I'm talking about your case for counsel fees.

MR. SCHUMACHER: That's all I'm trying to clarify.

THE COURT: I'm going to enter an order then that dismisses the case with prejudice subject to the agreement which counsel have placed in the record this morning. (Tr., Aug. 18, 2000, at T 2:25 to T 4:9).

On August 18, 2000, this Court entered an Order granting plaintiffs' motion for voluntary dismissal of their claims and dismissing the action with prejudice, subject to the above-quoted agreement regarding defendants' ability to seek, and plaintiffs' ability to defend against, claims for attorney's fees in this or another action, pursuant to the contractual fee-shifting terms of the Franchise Agreement.

On August 21, 2000, this action was closed. On September 20, 2000, the GNC Defendants filed the instant motion for attorney's fees and costs pursuant to Rule 54(d), Fed. R. Civ. P. as a prevailing party. For the reasons stated herein, the GNC Defendants' Rule 54 motion for attorney's fees will be dismissed without prejudice.

II. DISCUSSION

The basis for recovery of fees in this case is not statutory and arises only from the terms of the Franchise Agreement *fn1 between GNC Franchising and the Sokoloff plaintiffs. (See Defs.' Br., Ex. A.) Payment of attorneys fees was not imposed as a condition of this Court's Order approving the voluntary dismissal of plaintiffs' claims with prejudice pursuant to Rule 41(a)(2), and thus that Order did not establish an entitlement to attorney's fees. *fn2 The issue presently before this Court is whether defendants' contractually-based motion for fees, following the voluntary dismissal of plaintiffs' action with prejudice, is properly before this Court pursuant to Rule 54(d), Fed. R. Civ. P. As discussed below, this Court finds that it is not.

A. Timeliness of the Motion for Attorney's Fees and Costs

As a preliminary matter, the Court must determine whether defendants' Rule 54(d) motion was timely, although not filed within the rule's fourteen-day time limit. On August 18, 2000, this Court entered an Order granting plaintiffs' motion to voluntarily dismiss their claims and dismissing their action with prejudice. This Order was entered on the Court's Docket on August 21, 2000. Defendants filed the instant motion for attorney's fees and costs pursuant to Rule 54(d), Fed. R. Civ. P. Plaintiffs argue that the motion, filed on the thirtieth day after the entry of the final order, is untimely under Fed. R. Civ. P. 54(d)(2)(B). Defendants argue that their motion is timely under L. Civ. R. 54.2, which requires that an affidavit in support of a fee petition be filed within thirty days of the entry of judgment or order. Defendants alternatively seek enlargement of the fourteen day limit in Rule 54(d)(2)(B) pursuant to Rule 6(b)(2), Fed. R. Civ. P.

1. Fed. R. Civ. P. 54(d)(2)(B) *fn3

Plaintiff correctly notes that the GNC Defendants failed to file a motion for attorney's fees within fourteen days of the entry of final judgment in this case, and the GNC Defendants do not dispute that fact. This fact, however, in light of the other circumstances presented does not warrant dismissal of the instant fee petition as out of time.

The fourteen day filing requirement imposed by Rule 54(d)(2)(B) is not jurisdictional. See Mints v. Educational Testing Serv., 99 F.3d 1253, 1260 (3d Cir. 1996). The fourteen day limit, however, should not be lightly disregarded. According to the 1993 Advisory Committee Notes, "[54(d)(2)(B)] provides a deadline unless the court or a statute specifies some other time. One purpose of this provision is to assure that the opposing party is informed of the claim before the time for appeal has elapsed." The Advisory Committee Notes also provide that "[p]rompt filing affords an opportunity for the court to resolve fee disputes shortly after trial, while the services performed are freshly in mind."

In this case, the circumstances do not support a strict interpretation of the fourteen day filing requirement. First, plaintiffs were in no way harmed by the GNC Defendants' filing of the fee motion on the thirtieth, instead of the fourteenth, day after final judgment was entered. Plaintiffs do not and could not reasonably argue, for instance, that they were prejudiced by defendants' delay from filing an appeal because it is highly unlikely that plaintiffs would have appealed this Court's order granting their own motion to voluntarily dismiss their claims. Next, plaintiffs had ample notice that defendants would seek attorney's fees related to the dismissed claims in this or another action, as evidenced by the exchange during the August 18, 2000 telephone conference. (See Tr., Aug. 18, 2000.) Last, as discussed in greater detail below, the GNC Defendants submitted a detailed affidavit of their fee claim within thirty days of the entry of final judgment as required by L. Civ. R. 54.2. Such action ensures that the fee claim was prepared by the GNC Defendants while the services were still freshly in mind. In light of these facts and circumstances, denying the GNC Defendants' motion on strictly procedural grounds appears to contravene the spirit of Rule 54(d)(2). *fn4

2. L. Civ. R. 54.2 *fn5

The GNC Defendants argue that L. R. Civ. P. 54.2 and not Fed. R. Civ. P. 54(d)(2)(B) contains the applicable time limit for the filing of a motion for attorney's fees. Because of its relatively short filing deadline, Fed. R. Civ. P. 54(d)(2)(B) does not require fee motions to be fully supported when filed. See 10 Wright, Miller & Kane, Federal Practice and Procedure: Civil § 2680 at 493 (3d ed., 1998). Local Rule 54.2 does not extend the fourteen day period for filing a motion for attorney's fees, but instead requires that a detailed supplemental affidavit be filed within thirty days of the entry of judgment in support of fees motions filed in the District of New Jersey.

The fully supported fee motion in this case was filed on September 20, 2000, the thirtieth day after the final order was entered. Thus, the defendants' motion package was ready for adjudication on the thirtieth day, just as it would have been if the Rule 54(d) motion had been filed on the fourteenth day and the L. Civ. R. 54.2 affidavit was filed on the thirtieth day, as permitted by these rules. Although the motion was technically filed out of time, this Court, in its discretion, will grant the defendants' request to enlarge the fourteen day period to thirty days pursuant to Rule 6(b)(2), Fed. R. Civ. P., discussed below.

3. Fed. R. Civ. P. 6(b)(2) *fn6

Based on the facts of this motion for fees, this Court will exercise its discretion under Rule 6(b)(2) to extend the time limit for the defendants in this case to file a motion for attorney's fees to thirty days. See Fed. R. Civ. P. 6(b)(2); see also Schering Corp., 198 F.R.D. at 425. *fn7

The Supreme Court in Pioneer Inv. Servs. v. Brunswick Assoc. Ltd. Partnership, pronounced that the "excusable neglect" standard is an equitable one, and necessitates considering a situation's totality. 507 U.S. 380, 113 S. Ct. 1489, 123 L. Ed. 2d 74 (1993); see also In re Cendant Corp. Prides Litig., 233 F.3d 188 (3d Cir. 2000). Relevant factors to be considered are: (1) the danger of prejudice to the non-movant; (2) the length of the delay; (3) the reason for the delay; (4) whether the movant acted in good faith and (5) whether the inadvertence was a result of ignorance of the rules of procedure. Schering Corp., 198 F.R.D. at 426 (citing Pioneer, 507 U.S. at 395; Dominic v. Hess Oil V.I. Corp., 841 F.2d 513, 517 (3d Cir. 1988)). Defendants' application easily meets these standards and their Rule 54(b) motion will be deemed timely. *fn8

B. The GNC Defendants' Fee Motion Under Rule 54(d)

The Court must now address the issue of whether defendants' motion for attorney's fees was properly brought in this Court under Rule 54(d). The Court asked the parties, by letter dated April 4, 2001, to submit supplemental briefs on this issue, which were received by April 24, 2001. This Court must determine whether the substantive law governing the issue of attorney's fees in this case requires that fees be proved as an element of damages at trial, in which case this motion is not properly brought under Rule 54(d)(2). If defendants' contractual fee claim must be pleaded and proved as an element of damages, then this Court will not reach the interpretation of the underlying contractual language of the Franchise Agreement and will deny defendants' motion, without prejudice to their filing of a contract-based fee complaint in an appropriate state or federal court.

Rule 54(d) reads, in relevant part:

(d) Costs, Attorneys' Fees.

(2) Attorneys' Fees.

(A) Claims for attorneys' fees and related non-taxable expenses shall be made by motion unless the substantive law governing the action provides for the recovery of such fees as an element of damages to be proved at trial. Fed. R. Civ. P. 54(d)(2)(A).

The Advisory Committee Notes to the 1993 Rule Amendments address the application of Rule 54(d)(2), and instruct that paragraph 2 "establishes a procedure for presenting claims for attorneys' fees, whether or not denominated as `costs.' . . . [and] applies also to requests for reimbursement of expenses, not taxable as costs, when recoverable under governing law incident to award of fees." Rule 54(d)(2) advisory committee's note, 1993 Amendment. The note also directs that Rule 54(d)(2)(A) does not "apply to fees recoverable as an element of damages, as when sought under the terms of a contract; such damages typically are to be claimed in a pleading and may involve issues to be resolved by a jury." Rule 54(d)(2) advisory committee's note, 1993 Amendment (emphasis added).

In their supplemental brief, defendants argue that they are entitled to recover attorney's fees under Rule 54(d) because Pennsylvania substantive law applies and does not require fees to be proven as an element of damages. Defendants alternatively argue that they are entitled to fees under Rule 54(d) even if New Jersey substantive law applies, which requires that fees be pleaded and proved as an element of damages, because they have met the test articulated in Cohen v. Fair Lawn Dairies, Inc., 44 N.J. 450, 210 A.2d 73 (1965)(instructing that where certain specific elements are present in a case, plenary proof for an award of attorney's fees may not be necessary). Plaintiffs argue that Cohen supports their position that New Jersey law requires that claims for fees be made as a part of the underlying action and proved as an element of damages. Plaintiffs further argue that because defendants agreed to the voluntarily dismissal with prejudice of the underlying action, without ever having made a counterclaim for fees, the New Jersey Entire Controversy Doctrine bars defendants present application for fees under Rule 54(d)(2)(A).

1. Applicable Law

A threshold question is whether New Jersey or Pennsylvania substantive law should be applied in this contractual fee-shifting motion. Defendants seek to have this Court apply the law of Pennsylvania to the fee issue here because, they argue, that law does not require fees to be proved as an element of damages. Plaintiffs cite New Jersey law as applicable. Section XXV(A) of the Franchise Agreement provides:

This agreement . . . shall be interpreted and construed under the laws of the Commonwealth of Pennsylvania, which laws shall prevail in the event of any conflict of law; provided, however, that if any provision of this Agreement would not be enforceable under the laws of Pennsylvania, and if the Franchised Business is located outside of Pennsylvania, and further, if such provision would be enforceable under the laws of the state in which the Franchised Business is located, then such provision shall be interpreted and construed under the laws of the state. (Defs.' Br., Ex. A, Franchise Agreement at 44-45.)

GNC Franchising is a Pennsylvania corporation with its principal place of business in Pittsburgh. (Defs.' Supplemental Br. at 3-4.) Plaintiffs' franchised business is located at the Millside Shopping Center in Delran, New Jersey. (Defs.' Br. at 2.) Plaintiff's underlying action for a preliminary injunction arose from allegedly infringing sales that took place in New Jersey.

New Jersey courts will ordinarily uphold a contractual provision selecting a particular state's law as governing for interpretation of a contract, so long as that state's law does not violate New Jersey's public policy. See Instructional Sys. v. Computer Curriculum Corp., 130 N.J. 324, 341-42 (1992)(internal citations omitted). The law of the chosen state will apply, unless either:

(A) the chosen state has no substantial relationship to the parties or the transaction and there is no other reasonable basis for the parties' choice, or

(B) application of the law of the chosen state would be contrary to a fundamental policy of a state which has a materially greater interest than the chosen state in the determination of a particular issue and which . . . would be the state of applicable law in the absence of an effective choice of law by the parties. Instructional Systems, 130 N.J. at 342 (citing Restatement (Second) of Conflicts of Law § 187 (1969)).

Here, as in Instructional Systems, the first exception would not apply because GNC Franchising is a Pennsylvania Corporation, headquartered in Pittsburgh, and therefore has a "substantial relationship to the parties." The second exception, however, supports application of New Jersey law due to this state's "materially greater" interests, because plaintiffs reside in New Jersey, the franchise business is located in New Jersey, and the alleged violation occurred in New Jersey, when defendants began selling the PharmAssure brand products within the Sokoloff's protected territory, and in light of New Jersey's policy that claims for attorney's fees must be plead and proved as an element of damages. See Instructional Systems, 130 N.J. at 342-44.

Contrary to defendants' assertions, both New Jersey and Pennsylvania law provide for the recovery of attorney's fees pursuant to a contract to be proved as an element of damages. Pennsylvania law does not clearly support recovery of contractual fees by motion, *fn9 so, even if Pennsylvania law were to be applied in this case, it is not clear that defendants' Rule 54(d) motion would suffice. See In re Pennsylvania Footwear, Corp., 204 B.R. 165, 180-81 (Bankr. E.D. Pa. 1997)(holding that attorney's fees are generally not allowed as an element of damages absent express statutory allowance or agreement of the parties, thus implying that contractual attorney's fees are an element of contractual damages to be proved by trial). Because New Jersey has a materially greater interest in the litigation, because the New Jersey Supreme Court has upheld the state policy requiring attorney's fees to generally be proved as an element of damages, and because there is no meaningful conflict between New Jersey and Pennsylvania law, this Court will apply the law of the forum state, New Jersey.

Under New Jersey law, a claim for attorneys fees pursuant to a contractual agreement is an element of damages that must be pleaded and proved at trial. See Cohen v. Fair Lawn Dairies, Inc., 86 N.J. Super. 206, 215-216, 206 A.2d 585, 590 (App. Div. 1965), aff'd, Cohen v. Fair Lawn Dairies, Inc., 44 N.J. 450, 210 A.2d 73 (1965); Belfer v. Merling, 322 N.J. Super. 124, 141, 730 A.2d 434 (App. Div. 1999); Jennings v. Cutler, 288 N.J. Super. 553, 567, 672 A.2d 1215 (App. Div. 1996). The Cohen court distinguished the award of a counsel fee from an action to recover attorney's fees pursuant to a contract by concluding that "[u]nder an agreement . . . the remedy is one of damages, to be assessed by verdict of the finder of fact as a matter of right, and in the actual amount of damages established by the proofs." Cohen, 86 N.J. Super. at 215, 206 A.2d at 590. The court went on to write that the party seeking fees under a contract "must prove their damages in respect of the obligation of legal expenses in the same manner as they would any other item of damages. There must be plenary proof, not merely by Ex parte affidavit. . . ." Cohen, 86 N.J. Super. at 216, 206 A.2d at 590.

Defendants properly identify the New Jersey Supreme Court's opinion in Cohen which, although it upheld the Appellate Division's reasoning and conclusions, instructed that in future cases, where the trial proceeding dealt primarily with other substantive issues, where an affidavit of services was filed for fees, and where the other party submitted no opposition, there would be no compelling reason to require plenary proof for the award of contractual counsel fees. See Cohen, 44 N.J. 450 at 452. This Court finds that the circumstances of the instant case do not fall within the exception articulated by the New Jersey Supreme Court in Cohen. Here, defendants are seeking over $50,000 in attorney's fees arising from plaintiffs' application for a preliminary injunction. Plaintiffs contest defendants' contractual entitlement as well as the amount of damages claims. Although this Court determined that plaintiff had failed to meet its burden for a preliminary injunction, there is no allegation or evidence that plaintiffs' underlying suit was frivolous. Additionally, after plaintiffs weighed their chances of ultimate success in light of this Court's decision in Kazmierski, No. 99-5281, slip op. (D.N.J. March 31, 2000)(Simandle, J.)(permitting the sale of PharmAssure brand products within the plaintiffs' protected territory), they agreed to voluntarily dismiss their action with prejudice, thereby assuring that defendants would not have to defend against another identical action. Defendants therefore do not fall into the exception to the general rule that contractual attorney's fees must be plead and proved as an element of damages.

2. Rule 54(d) Motion for Fees Arising from Contract

Defendants concede that their basis for the recovery of fees is purely contractual, as there is no applicable statute in this case. (See Defs.' Reply Br. at 3.) Plaintiffs oppose defendants' motion as improper in form and barred by New Jersey's Entire Controversy Doctrine, and upon the substantive merits that defendants were not prevailing parties in the underlying Franchise Agreement litigation.

Defendants claim that "the Court did explicitly authorize the parties to seek attorney's fees under Phase II, Section XXV, Subsection G of the Franchise agreement" and that "[plaintiffs'] counsel did not deny that attorney's fees were available in this case." (Defs.' Reply Br. at 3.) *fn10 Contrary to defendants' assertions in their reply brief, the Court did not explicitly or implicitly authorize the recovery of fees, but instead merely approved the parties' agreement that fees could be sought by defendants and opposed by plaintiffs. *fn11

In summary, the text of Rule 54(d)(2)(A) prevents this Court from determining this contested contractual fee-shifting claim under the Franchise Agreement by motion because "the substantive law governing the action provides for the recovery of such fees as an element of damages to be proved at trial." Fed. R. Civ. P. 54(d)(2)(A). Although there is no dispute that the parties agreed to the fee-shifting provision in the Franchise Agreement, and that such an agreement is permissible, see Cohen, 86 N.J. Super. at 215-16, 206 A.2d at 590, New Jersey substantive law requires that attorney's fees be proved as an element at trial, id., and therefore, in the absence of plaintiffs' consent to waive the Rule 54(d)(2) bar, defendants must bring a separate action in a court of competent jurisdiction for the award of attorneys fees as damages, arising from the contractual obligations of the Franchise Agreement.

3. New Jersey's Entire Controversy Doctrine

Finally, plaintiffs argue that defendants' motion for attorney's fees was a compulsory counterclaim in the underlying action and, as such, is barred by New Jersey's Entire Controversy Doctrine. The Entire Controversy Doctrine has been described as "New Jersey's specific, and idiosyncratic, application of res judicata principles," and requires defendants to assert compulsory counterclaims in the same action to avoid forfeiture of such claims. Rycoline Prods. v. C&W Ltd., 109 F.3d 883, 886 (3d Cir. 1997).

New Jersey's Entire Controversy Doctrine does not bar defendants from filing a separate action in a court of competent jurisdiction for the recovery of fees under the Franchise Agreement. First, this Court notes that defendants could not assert that they were "prevailing parties" under the Franchise Agreement until this case was resolved, and defendants cannot be found to be "prevailing parties" as intended in the contract until a court interprets that contract, which this Court does not now do. Also, during the August 18, 2000 telephone conference, defendants did everything procedurally possible to preserve their right to seek fees arising from the contractual fee-shifting language in the Franchise Agreement, and plaintiffs were aware of the possibility that such action could be brought in another litigation. Defendants, therefore, avoided the consequences of not filing a counterclaim for fees in this Court.

So, while this Court cannot on motion pursuant to Rule 54(d) interpret the contract and determine whether to award fees pursuant to the Franchise Agreement, another court may do so, upon defendants' initiation of other proceedings, without preclusion by New Jersey's Entire Controversy Doctrine.

III. CONCLUSION

For the reasons expressed above, this Court will dismiss the GNC Defendants' motion for attorney's fees and litigation costs under Rule 54(d), without prejudice. The accompanying Order is entered.

JEROME B. SIMANDLE U.S. District Judge

ORDER

This matter comes before the court upon the motion by General Nutrition Companies, Inc. and GNC Franchising, Inc. (collectively the "GNC Defendants") for attorney's fees and litigation costs as prevailing parties under the terms of their franchise agreement with plaintiffs and pursuant to Rule 54(d)(2), Fed. R. Civ. P.; and the Court having considered the parties' submissions; and for the reasons expressed in an Opinion of today's date;

IT IS this 21st day of May, 2001 hereby

ORDERED that the GNC Defendants' motion for attorneys fees and litigation costs pursuant to Rule 54(d)(2) be, and hereby is, DISMISSED WITHOUT PREJUDICE.

JEROME B. SIMANDLE U.S. District Judge


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