This week, in Lackey v. Stinnie, the United States Supreme Court held that a plaintiff who obtains a preliminary injunction is not a “prevailing party” for purposes of obtaining an award of attorney’s fees under 42 U.S.C. § 1988. The Court reasoned that attorney’s fees are not available under § 1988 absent conclusive, court-ordered resolution of a claim. The decision may be an obstacle for plaintiffs who rely on § 1988 to recover attorney’s fees, particularly when pursuing emergency or temporary relief. Although the decision may be a hurdle for some litigants, litigants defending against claims subject to attorney’s fees under§ 1988, including employers defending against race-based discrimination claims under 42 U.S.C. § 1981, can use the reasoning in Lackey to provide swift and beneficial relief to plaintiffs while also minimizing liability for attorney’s fees. All parties to disputes covered by § 1988 would be wise to consider the effect of Lackey on their litigation strategy and risk exposure.
What happened in Lackey?
The case arose from a Virginia statute that penalized the plaintiffs by automatically suspending their driver’s licenses for failing to pay court fees and fines. When the plaintiffs challenged the law, the district court entered a preliminary injunction, enjoining the statute’s enforcement. Thereafter, the State of Virginia voluntarily repealed the statute, mooting the plaintiffs’ legal challenge and effectively securing plaintiffs the relief they sought without the need for a final court order. Although the repeal mooted the case before a trial on the merits, the district court considered whether the plaintiffs were entitled to attorney’s fees under § 1988. The district court decided plaintiffs were not entitled to attorney’s fees based on Fourth Circuit precedent that a party could never be a “prevailing party” based only on obtaining a preliminary injunction. The Fourth Circuit, sitting en banc, ultimately overruled its precedent and reversed the district court.
In a 7-2 decision, the Supreme Court reversed and remanded the Fourth Circuit’s en banc ruling, creating a bright-line rule for when litigants will be considered a “prevailing party” eligible for attorney’s fees under § 1988: a court must conclusively resolve the party’s claim by granting enduring judicial relief on the merits in a way that materially alters the legal relationship between the parties. In other words, a preliminary injunction alone cannot confer “prevailing party” status on a litigant because, as the Supreme Court reasoned, preliminary injunctions only temporarily preserve the parties’ positions until trial and do not conclusively resolve a dispute. Likewise, a defendant’s voluntary submission to the relief requested in a suit also is insufficient to render a plaintiff the prevailing party. Any relief received by a prevailing party must be given force of law by a court, such as a court order or a consent decree — a litigant’s voluntary act will not bestow “prevailing party” status.
What does Lackey mean for employers and plaintiffs seeking attorney’s fees under § 1988?
Time will tell whether Lackey results in a decrease in claims covered by § 1988, particularly suits that pursue emergency injunctive relief, due to the limits placed on the ability to recover attorney’s fees. For employers weighing their potential liability in such actions, however, Lackey invites a reassessment of resolution strategies and presents a potential roadmap for avoiding a fee award by voluntarily providing the requested injunctive relief prior to a final court ruling—a path that could lead to more positive outcomes for all parties.
