Supreme Court to Consider Whether States Have to Pay Attorney Fees

The U.S. Supreme Court in Washington on Sept. 9, 2024. Madalina Vasiliu/The Epoch Times

The Supreme Court will soon consider whether plaintiffs who enjoy partial success in civil rights lawsuits are entitled to have the governments they sue compensate them for attorney’s fees.

Both civil rights activists and governments say the stakes are high.

The case concerns whether activists who secure a preliminary injunction in a lawsuit should be able to require that governments pay their legal expenses.

If the court rules against the government, in this case Virginia, it could be a boost for citizens suing governments in civil rights actions, the Legal Aid Justice Center of Charlottesville, Virginia, co-counsel for the motorists, argues.

Virginia is putting “civil rights enforcement and access to the courts at risk across the country,” the center previously said.

By contrast, Virginia and various states and localities argue that it is wrong to award legal costs to litigants who fail to win a final judgment in court.

Awarding legal costs for half-completed lawsuits hurts government coffers, state and local governments say.

If a litigant can get a judge to block a law before determining the merits of a case, it could lead to “exorbitant taxpayer-funded windfalls—with no real connection to their actual damages or the case’s constitutional significance,” the National Association of Counties argued in a June 27 brief.

Federal laws enabling civil rights lawsuits “were passed to vindicate civil rights, not to place the federal courts in charge of funneling ... taxpayer dollars to plaintiffs’ attorneys simply because they stumbled upon a government policy that can be challenged.”

The brief offers examples of cases that went to the injunction stage but ended up being dismissed.

In NAACP v. Hargett (2021), a federal court ordered Tennessee to pay $842,000 in legal fees to a group that won an injunction against a voter registration law, which the state Legislature later repealed.

In Roberts v. Neace (2023), the U.S. Court of Appeals for the Sixth Circuit upheld a lower court order requiring Kentucky to pay $270,000 in legal fees to plaintiffs who secured an injunction allowing them to attend church during the COVID-19 pandemic lockdowns. The state later changed the church attendance policy.

Case History

The Virginia case, Lackey v. Stinnie, to be heard on Oct. 8, involves a now-repealed state statute that mandated the automatic suspension—without notice or a hearing—of driver’s licenses for people who fail to pay court fines or fees.

In January 2020, before repeal, close to 1 million license suspensions were in effect in Virginia, according to the Fines and Fees Justice Center.

A federal district court temporarily blocked the law, known as Section 46.2-395 of the Virginia Code, in 2018, finding that drivers would probably succeed on the merits. Virginia did not appeal, and in April 2020, the Virginia General Assembly wiped the statute from the law books before a trial could take place.

The case itself hinges on the meaning of the phrase “prevailing party.”

In the U.S. justice system, each party in a lawsuit typically pays his or her own attorney’s fees, win or lose. However, some statutes require the payment of “a reasonable attorney’s fee” to the “prevailing party” in litigation.

For example, 42 U.S. Code Section 1988 requires the unsuccessful party to pay the attorney’s fees of parties who succeed in civil rights lawsuits.

In this case, five Virginia residents with suspended licenses sued in federal court to invalidate, on equal protection and due process grounds, the statute that ended up being repealed.

The motorists wanted the state to cover attorney’s fees, so they sued under Section 1988.

The state argued that it didn’t have to pay because the drivers didn’t qualify as prevailing parties because the case was never fully adjudicated on the merits.

The district court denied the drivers’ petition in June 2021, finding that granting a preliminary injunction didn’t make them a “prevailing party.”

The motorists appealed, and the U.S. Court of Appeals for the Fourth Circuit overturned the ruling in a 7–4 vote in August 2023.

The court said, “The plaintiffs here ‘prevailed’ in every sense needed to make them eligible for a fee award.”

Not requiring a government to pay may allow “government defendants to game the system,” as they continue to press lawsuits in the hope of “outlast[ing] an indigent plaintiff.”

As a result, there will be “fewer attorneys willing to represent civil rights plaintiffs in even clearly meritorious actions—particularly those whose urgent situations call for interim relief,” the court said.

Federal courts of appeal disagree on whether winning an injunction in a civil rights lawsuit requires the losing party to pay legal expenses, Virginia argued in its petition.

The Supreme Court has not issued a “decision on point” and has “announced fact-specific standards that are anything but uniform,” the Fifth Circuit determined in Dearmore v. City of Garland (2008).

The Third Circuit found in Silver Management Consultants v. Milgram (2011) that “merely finding a likelihood of success” does not count as a “‘merits-based’ ruling.”

And the District of Columbia Circuit found in Select Milk Producers v. Johanns (2005) that because preliminary injunctions “are usually based on ‘a likelihood of success on the merits,’” “it follows that parties will not often ‘prevail’ based solely on those events.”

At the same time, the Second, Fourth, Eighth, Ninth, 10th, and 11th Circuits have found “that a prediction of future success is sufficient, at least in certain circumstances,” the petition stated.

Virginia Appeals

Virginia appealed to the Supreme Court, which approved its petition on April 22.

Citing legal precedents, Gerald Lackey, commissioner of the Virginia Department of Motor Vehicles, argued in a June 20 brief that “prevailing party” refers only to a litigant who “ultimately prevails ‘on the merits’ in the litigation or obtains a final judgment in its favor.”

The litigant must secure an “enduring” and “judicially sanctioned change in the legal relationship of the parties,” the brief states.

“Preliminary injunctions bear none of these hallmarks. ... Rather, they merely predict the ‘probability of’ the party’s ‘ultimate success,’” it states.

Georgia and 18 states support Virginia, saying in a Jan. 5 brief that states need “clear and predictable rules for when they might be exposed to [legal fee awards].”

The federal government also weighed in on Virginia’s behalf.

In the context of litigation costs, a prevailing party is someone who is granted relief at the conclusion of a legal action when the court pronounces judgment, according to its June 27 brief.

Because there was no final determination of the case’s merits, the litigants cannot be “‘prevailing parties’ under Section 1988(b),” it states.

One of the drivers, lead respondent Damian Stinnie, told the Supreme Court in an Aug. 5 brief that it should reject Virginia’s “contrary categorical rule that preliminary injunctions never create a prevailing party.”

“The test to determine a ‘prevailing party’ is whether a plaintiff wins tangible relief from a court order that is never undone on the merits ... as every circuit [court] to address the issue holds,” the brief states.

The Supreme Court has “always construed the term ‘prevailing party’ with a view to that ordinary meaning,” and legal dictionaries say the same thing, the brief states.

Experts Weigh In

Experts consulted by The Epoch Times expressed support for the drivers’ position.

Richard McCarty, president of Vienna, Virginia-based Coalition for Motorist Rights, said it made sense for motorists to challenge the state law because “I have a problem with them revoking licenses for reasons other than someone being a dangerous driver.”

“If someone owes the state some money, or owes a locality some fine money, that’s not an acceptable reason to take somebody’s license,” McCarty said.

“[The motorists] in this case prevailed, so they should be entitled to costs,” he told The Epoch Times.

Nate Kellum, senior counsel for Plano, Texas-based First Liberty Institute, was sympathetic to Stinnie’s argument.

“I think I agree with the citizens,” he told The Epoch Times.

Allowing a government to cancel a lawsuit by changing a disputed policy provides the wrong incentives to governments because once a government knows it is going to lose a case, it is easy for it to escape financial responsibility, he said.

This would set a “bad precedent,” Kellum said.

Matthew C. Forys, executive vice president of the Leesburg, Virginia-based Landmark Legal Foundation, also expressed sympathy for the motorists.

“Suing the government is often a David versus Goliath struggle and can be expensive, lengthy, and exhausting,” he said.

Forys predicted that drivers would receive “a sympathetic ear” from Justice Neil Gorsuch, whose recently published book “highlights how daunting the legal system can be for the average citizen who is in a dispute with the government.”

He was referring to “Over Ruled: The Human Toll of Too Much Law,” published in August by Harper Collins.

Although some law “is essential to our lives and our freedoms ... too much law can place those very same freedoms at risk and even undermine respect for law itself,” a publisher’s summary states.

Virginia Department of Motor Vehicles spokesman Mike Pressendo declined to comment, saying it was “inappropriate for us to discuss active litigation.”

The Legal Aid Justice Center did not reply by publication time to repeated requests for comment.