Resolving a split among circuit courts, a unanimous Supreme Court ruled that a court may grant reasonable attorney’s fees to a defendant in certain civil rights cases involving both frivolous and nonfrivolous claims, but only for fees the defendant would not have incurred but for the frivolous claims. Fox v. Vice, __ U.S. __, No. 10-114 (June 6, 2011).

The case arose out of a police chief election in Vinton, Louisiana between candidates Ricky Fox and Billy Ray Vice, who resorted to “dirty tricks” to force Fox out of the race. Vice was later convicted of criminal extortion for his election-related conduct. Fox filed suit asserting state-law claims, including defamation, and federal civil rights claims under 42 U.S.C. § 1983, including interference with his right to seek public office. Vice asked the trial court to enter judgement on Fox’s federal claims, which Fox conceded were “no[t] valid.” The district court dismissed the federal claims with prejudice, and sent the remaining state law claims to state court for adjudication.

Vice then asked the federal court for an award of attorney’s fees under 42 U.S.C. § 1988, on the ground that Fox’s federal claims were frivolous. The trial court granted this request, but did not require Vice to separate the work his attorneys had done on the state claims from the federal claims and did not reduce the fee award to reflect the surviving state law claims. The U.S. Court of Appeals for the Fifth Circuit affirmed.

The Supreme Court reversed, holding that the defendant was only entitled to the costs it would not have incurred but for the frivolous claims. Section 1988 authorizes awards of reasonable attorney’s fees to a prevailing party, including a prevailing defendant where plaintiff’s suit is found to be frivolous. The Supreme Court noted that plaintiffs may receive fees under § 1988 even if they are not victorious on every claim and so confirmed that defendants as well may deserve fees even if not all of the claims were frivolous.

Turning then to the question of allocation when a suit involves a mix of frivolous and nonfrivolous claims, the Court looked for a “meaningful standard” to guide trial courts while preventing windfalls to some defendants. The Supreme Court concluded that § 1988 allows a defendant to recover “reasonable attorney’s fees incurred because of, but only because of, a frivolous claim.” Nonetheless, the Court cautioned that the determination of fees “should not result in a second major litigation,” and that “[t]he essential goal in shifting fees (to either party) is to do rough justice, not to achieve auditing perfection.”

Because the courts below applied the wrong standard, and particularly in light of evidence that Vice’s attorneys would have done “much the same work” even without the frivolous claims, the Court remanded the case for reconsideration by the lower court.

Employers facing potentially frivolous claims should be aware of the opportunities for, and limitations on, recovery of attorney’s fees under this new standard.