The award by the special master came as a result of a finding last December by the trial court judge that RE/MAX and Murphy were entitled to recover their attorneys' fees because "the trade secrets claims of Century 21 were brought and maintained in bad faith." The trial court judge then referred the matter to the special master to determine the amount of recoverable fees, and the special master entered his order last week awarding a total of more than $3.8 million in attorneys' fees.

The lawsuit was tried to a jury for over five months, from March through August 1997. At the completion of Century 21's presentation of evidence, trial court Judge William McDonald dismissed all but one of Century 21's claims. On Aug. 21, 1997, the jury returned a verdict in favor of RE/MAX and Murphy on the sole remaining claim. The jury also returned a verdict in favor of Murphy on Murphy's counterclaim against Century 21 for defamation, finding that Century 21 had acted "with malice, oppression or fraud." The jury awarded Murphy more than $100,000 in compensatory damages and $750,000 in punitive damages (the punitive damages award was later reduced by the trial court to $450,000).

In recent years, RE/MAX has won several other legal battles with Century 21. In 1994, U.S. District Court Judge Alicemarie Stotler entered an injunction against Century 21 prohibiting certain "home-a-minute" advertising, and then issued a contempt of court order against Century 21 for violating that injunction. Judge Stotler also dismissed numerous false advertising claims brought by Century 21 against RE/MAX and one of its California franchisees.

"When the jury found in our behalf, we were pleased," says Dave Liniger, RE/MAX co-founder and chairman. "We knew Century 21's claims were without merit, but when you consider the high costs of a legal battle, some people -- even companies -- cannot afford it. We were very pleased with the excellent work of our legal team, and it now appears that we are going to recover the attorneys' fees that we were forced to incur in defending the one thing that is worth more than any amount of money -- our reputation."

Tom Johnson of the Denver law firm, Davis, Graham & Stubbs acted as lead counsel for the RE/MAX defense team, and RE/MAX was also represented in the proceedings by Neil Soltman of the Los Angeles office of Mayer, Brown and Platt. Several federal cases, including one in which RE/MAX has challenged Century 21 advertising claims purportedly based on surveys conducted by The Wirthlin Group, are still pending.