Does rule 41(d) authorize an award of attorney's fees?

St. John's Law Review, Winter 1997 by Edward X Clinton Jr

EDWARD X. CLINTON, JR.'

INTRODUCTION

Rule 41 of the Federal Rules of Civil Procedure governs the dismissal of actions, with subsection (a) governing voluntary dismissals.l Rule 41(d) applies where a plaintiff voluntarily dismisses a case in one jurisdiction and then refiles the same or similar case in another jurisdiction.2 The Rule allows the defendant, once the case has been refiled in another jurisdiction, to recover the costs associated with defending a previously dismissed action.3 The Rule is designed to discourage plaintiffs from forum shopping and to compensate defendants for expenses incurred in defending the same case twice.4

Recently, courts have split on the issue of whether the Rule allows an award of attorney's fees. Most courts that have addressed the issue have held that fees may be awarded.5 A minority have held that fees may not be awarded.6Courts have reasoned that the Rule's purpose, the discouragement of forum shopping, will be furthered by the award of attorney's fees.7 One recent decision awarding fees has argued that Rule 41(d) should be construed in a manner consistent with Rule 41(a)(2), which has been interpreted to allow a court to award attorney's fees to the defendant upon granting a plaintiff a voluntary dismissal.8 Other courts awarding attorney's fees under Rule 41(d) have not explained the bases for their rulings.9

This Article asserts that the Rule's text does not support an award of attorney's fees and that the reasoning of the federal district courts which have awarded such fees is inconsistent with Supreme Court precedent. Part I discusses the Supreme Court's jurisprudence concerning whether a statute allows an award of attorney's fees. Parts II and III analyze the text of Rule 41(d), the interpretation of the term "costs," and the use of "costs" in other Federal Rules of Civil Procedure. Part IV highlights the policy considerations urged by the courts that award attorney's fees under the Rule. Part V then analyzes the argument made by one court that Rule 41(d) should be construed in the same manner as Rule 41(a)(2). Finally, the Article concludes that these policy considerations are overcome by sound principles of statutory construction and Supreme Court precedent.

I. SUPREME COURT DECISIONS ON ATTORNEY'S FEES Before analyzing the text of Rule 41(d), this Article will discuss recent Supreme Court decisions analyzing whether statutes authorize awards of attorney's fees. These decisions make clear that the general rule, known as "the American Rule," requires that absent an express statutory authorization, a court may not award attorney's fees.l0

A. Alyeska Pipeline

The leading decision concerning the issue of awarding attorney's fees is Alyeska Pipeline Service Co. v. The Wilderness Society.ll The lawsuit arose out of the discovery of a major oil field in Alaska.l2 After the oil was discovered, oil companies applied for permits to build a pipeline across Alaska to a seaport on the Pacific Ocean.l3 The plaintiff environmental groups sued the Secretary of the Interior, arguing that the Secretary intended to issue permits for the pipeline in violation of several federal statutes.l4 Plaintiffs initially obtained an injunction against the issuance of the permits.15 Congress then passed a statute allowing the pipeline to proceed.l6 Plaintiffs next sought to recover their attorney's fees on the ground that they had vindicated important statutory rights.l7 Plaintiffs claimed that they were acting as a "private attorney general."l8 The Court of Appeals agreed with this reasoning and awarded attorney's fees to be paid by the defendant pipeline company.l9

The Supreme Court reversed.20The Court observed that under "the American Rule" no attorney's fees are awarded to the prevailing party in civil lawsuits.2l The Court noted that common law courts in England have been authorized to award attorney's fees to the prevailing party since the Middle Ages.22 There is an exception to the American Rule only where Congress has passed a statute expressly authorizing the award of attorney's fees.23 The Court declined to create an exception to the rule for plaintiffs vindicating a statutory right, because the creation of such a right would usurp congressional authority.24

B. Key Tronic

A recent Supreme Court decision considered whether the term "costs of response" in an environmental statute authorized the recovery of attorney's fees. In Key Tronic Corp. v. United States,25 the Court considered whether attorney's fees are "costs of response" within the meaning of section 107 of the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA").26 Writing for the majority, Justice Stevens commented: "Our cases establish that attorney's fees generally are not a recoverable cost of litigation `absent explicit congressional authorization.' ,27 The Court continued, "Recognition of the availability of attorney's fees therefore requires a determination that `Congress intended to set aside this long-standing American rule of law.' "28 The Court initially noted that neither section 107 (liabilities and defenses) nor section 113 (contribution claims) "expressly mention[ed] the recovery of attorney's fees."29 The Court made clear that there was no requirement that the statute specifically refer to attorney's fees.30 An award of fees may be authorized, even if not expressly provided for, "if the statute otherwise evinces an intent to provide for such fees."3l