Partially Concurring/Dissenting Justice Would Vacate Costs Award And Remand To Determine If Bad Faith Existed, Wanting Ninth Circuit To Join Sister Circuits Finding That Bad Faith Can Be A Predicate For A Fees As Costs Award.
Moskowitz v. American Savings Bank, F.S.B., No. 20-15024 (9th Cir. June 10, 2022) (published) involved an interesting “attorney’s fees as costs” issue which drew a split decision.
The plaintiff in a Telephone Consumer Protection Act case (which has no statutory basis for fees to a prevailing party) lost on a successful summary judgment motion by the defense after voluntarily dismissing a previous case against defendant in Connecticut (the dismissal being without prejudice and without costs). The Ninth Circuit affirmed the summary judgment grant. Defendant moved for routine costs and then attorney’s fees as additional costs under Federal Rules of Civil Procedure, rule 41(d), which were awarded by the district judge. The Ninth Circuit majority, in a decision authored by Circuit Judge Bea, affirmed the routine costs award but reversed the “fees as costs” award. Circuit Judge Wardlaw, in partial concurrence and in partial dissent, would have vacated and remanded the “fees as costs” award rather than reverse it outright.
The Ninth Circuit, across the board, agreed that attorney’s fees are not automatically costs; rather, there must be a statutory basis for fees (none existed under the TCPA) or there must be allegations/proof of bad faith conduct, including forum shopping. The majority found that bad faith was neither alleged nor proven, such that a reversal of the “fees as costs” award should occur. In dissent, Circuit Judge Wardlaw would have vacated the “fees as costs” award and remanded to determine if there was bad faith, writing that the Ninth Circuit should join sister circuits to reach consensus that rule 41(d) did allow fees as costs where bad faith was shown.
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