The decisions from the United States Supreme Court have been less than friendly to employers during the past several years. The expansion of retaliation claims and what may support such claims are a prime example. However, this past week, the Supreme Court issued a decision in Fox v. Vice, U.S. No. 10-114 (June 6, 2011) recognizing a defendant’s right to recover fees and costs for a frivolous claim even where the plaintiff also has asserted a non-frivolous claim.
The Court resolved a split among the federal appellate courts on how (and whether) to allocate attorneys’ fee awards when a civil rights case involves claims with arguable merit and claims with absolutely no merit whatsoever. The latter claims are commonly known as “frivolous claims.”
Most employers recognize that even when they are successful in defending against civil rights litigation (claims of discrimination), they have had to expend a great deal of money for that “honor.” They also recognize that this money is rarely, if ever, recoverable — it becomes a cost of doing business — and sometimes a very hefty cost. This is because in most discrimination cases, attorneys’ fees and costs are recoverable only by a successful employee. Successful employers cannot recover their fees and costs unless the claim is frivolous, and even then, when an employee made both a frivolous and a non-frivolous claim, the employer could not recover in some courts. That is no longer the case.
Supreme Court Justice Elena Kagan wrote for a unanimous Court that when an employee’s suit involves both frivolous and non-frivolous claims, a court may award the employer the costs and fees incurred in defending against the frivolous claim. This is great news, but it is not without some limitations. According to the Court, the amount of fees and costs recoverable cannot extend beyond those that are reasonable and were otherwise incurred because of the frivolous claim — that is, only those reasonable fees and costs that would not have been incurred but for the frivolous claim are recoverable.
In an age when victories for employers in an increasingly litigious society come at large costs, even a small return is better than none at all.