In a significant ruling, the U.S. Supreme Court has decided that litigants will no longer be considered the “prevailing party” for purposes of awarding attorney fees if their courtroom victories are based on preliminary injunctions rather than final judgments. This decision is particularly impactful for legal advocacy groups, as it alters the prevailing party fee-shifting framework that has been a vital element of civil rights lawsuits since its inclusion in Section 1988 of Title 42 of the U.S. Code in 1976.
In the 7-2 decision, the majority of the court deemed that a preliminary injunction’s “transient victory” doesn’t meet the criteria to declare a litigant as the prevailing party, stressing that a final ruling with a material and judicially sanctioned change is necessary. However, Justice Ketanji Brown Jackson, joined by Justice Sonia Sotomayor, dissented, arguing that the decision contradicts Congress’s intention in drafting Section 1988 to promote private lawsuits enforcing citizens’ constitutional rights.
The case originated from a civil rights class action in Virginia, where indigent drivers, represented by the Legal Aid Justice Center and McGuireWoods, challenged a law suspending driver’s licenses for unpaid traffic fines. After managing to obtain a preliminary injunction and subsequent legislative change, they were left without a final judgment, complicating the assignment of attorney fees.
The decision may have far-reaching financial implications for advocacy groups, with a broad spectrum from the American Civil Liberties Union to the Alliance Defending Freedom expressing concerns. The court’s decision underscores the necessity for legislative intervention if Congress intends for preliminary injunctions to confer prevailing party status.