SCOTUS Addresses Fee Shifting in Fox v. Vice

On Monday, the Supreme Court of the United States issued its opinion in Fox v. Vice, a civil rights attorney fee case.  In Fox, the Court addressed a defendant’s ability to recoup attorney fees for having to defend a frivolous civil rights claim.  The problem, however, is that litigation is not black-and-white, with frivolous claims completely divorced from non-frivolous claims.  Instead, the frivolous and non-frivolous claims are often mixed together.  In these “mixed” claims, a defendant may still recover attorney fees under 42 U.S.C. § 1988, but he can only “recover the reasonable attorney’s fees he expended solely because of the frivolous allegation.”  The Court’s “but-for” test allows fees for the defense of frivolous claims, but only for the litigation costs caused by the frivolous claim.  If the cost would have been incurred anyway, during the defense of the non-frivolous claim, then that cost is not recoverable.

The crux of Fox will not affect the Longshore and Harbor Workers’ Compensation Act community.  Fox dealt with a situation that cannot arise in Longshore cases: a payment of attorneys fees to a prevailing defendant.  The Longshore attorney fee provision, Section 28, authorizes fees only for a claimant, and not an employer or carrier.  Even Section 26, which addresses the assessment of costs against a party who instituted or continued a proceeding without reasonable grounds, is applicable only after a case is referred to a court.  That means that Congress may have “assured workers of a trip through the administrative process free from the fear of cost imposition” because only courts, and not administrative agencies like the Office of Administrative Law Judges or the Benefits Review Board can assess costs.  Metropolitan Stevedore Co. v. Brickner, 11 F.3d 887 (9th Cir. 1993); Boland Marine & Mfg. Co. v. Rihner, 41 F.3d 997 (5th Cir. 1995).

Further, the attorney fees statute for a federal civil rights violation is much different than the Longshore and Harbor Workers’ Compensation Act’s fee shifting provision.  The Sixth Circuit noted that the one-sentence permissive rule of Section 1988, which states that a court, in its discretion, may allow the prevailing party a reasonable attorney’s fee, is not comparable to the “detailed provisions of Section 28.”  Day v. James Marine, Inc., 518 F.3d 411 (6thCir. 2008).  Nonetheless, any opinion from the Supreme Court regarding federal fee shifting statutes merits attention because lower courts use the Court’s opinions as guidance for all fee shifting cases, even when the underlying statutes are as divergent as the Section 1988 civil rights fees and the Section 28 Longshore fees. 

In Fox, the Court restated the admonition it issued in Hensley v. Eckerhart, 461 U.S. 424 (1983), that fee disputes “should not result in a second major litigation.”  The essential goal in shifting fees is “to do rough justice, and not to achieve auditing perfection.”  With that being said, the Court also stated that the lower court must apply the correct legal standard, and that a lower court has “wide discretion when, but only when, it calls the game by the right rules.”  It is the “detailed provisions of Section 28” that makes the “right rules” difficult to umpire.  Just as the Sixth Circuit recognized in Day, the Longshore fee shifting statute is much different than other federal fee shifting statutes.  For Longshore claims, Congress put the devil in the details, tempering the wide discretion afforded trial courts with express statutory prerequisites that must be satisfied prior to fee shifting—or, at least, that is what the majority of courts hold. 

Fox v. Vice, — U.S. —- (2011).

Jon Robinson
As a Member at Mouledoux, Bland, Legrand & Brackett, Jon Robinson focuses his practice on the representation of employers and carriers in matters arising under the Longshore and Harbor Workers' Compensation Act, the Defense Base Act, and the War Hazards Compensation Act. He can be contacted at (504) 595-3000 or by e-mail at jrobinson@mblb.com.
Jon Robinson