Tang v. Northpole, Ltd. et al

Filing 41

MEMORANDUM OPINION AND ORDER denying 28 Motion for Attorney Fees. Signed by Honorable Robert T. Dawson on April 6, 2012. (adw)

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
FAYETTEVILLE DIVISION

LARRY TANG,

PLAINTIFF

v.

Case No. 11-5112

NORTHPOLE, LTD. and
TOFASCO OF AMERICA, INC.,

DEFENDANTS

MEMORANDUM OPINION AND ORDER
Currently before the Court is Defendant Northpole, Ltd.’s
Motion for Attorney Fees and Costs.

(Doc. 28).

For the reasons

explained herein, Defendant’s Motion is DENIED.
I.

Background
In February, 2002, Plaintiff advised Defendants Northpole

and Tofasco that a lawsuit could ensue based on what he believed
to be infringement of his patent of a collapsible patio chair.
(Doc. 1, Ex. B).

Nine years later, in April of 2011, Plaintiff

filed a complaint in this Court alleging patent infringement and
seeking an injunction to compel the defendants to discontinue
the manufacturing, marketing and/or selling of any product in
violation of Plaintiff’s patent.

Plaintiff also seeks damages

and an award of attorney’s fees and costs.

(Doc. 1).

On June 10, 2011, Northpole filed a Motion to Dismiss on
Grounds

of

Equitable

Estoppel
1 

(Doc.

13),

contending

that

Plaintiff

engaged

in

misleading

conduct

that

lulled

it

into

believing Plaintiff had abandoned his claim of infringement, and
that it detrimentally relied on Plaintiff’s misconduct.

On June

22, 2011, Plaintiff requested the Court give additional time to
respond

to

Northpole’s

motion,

stating

that

he

required

additional time to conduct discovery for his response.
16).

(Doc.

The Court granted Plaintiff until September 16, 2011, to

respond to Northpole’s motion.

(Text Only Order entered July

14, 2011).

When Plaintiff had not filed a response by September

26,

the

2011,

Court

granted

Northpole’s

Motion

to

Dismiss,

dismissing Northpole without prejudice from this matter.

(Doc.

27).
Following

its

dismissal,

Northpole

filed

a

Motion

for

Attorney Fees and Costs, arguing that this case is “exceptional”
and that in the spirit of equity and fairness it should be
remunerated

for

the

costs

it

incurred

in

defending

Plaintiff’s “baseless allegations of infringement.”

against

(Doc. 28).

On the same date, Plaintiff moved to join previously dismissed
Northpole

as

a

defendant

to

the

lawsuit,

claiming

that

the

allegations he would make were the same as those originally
asserted against Northpole and that the facts and allegations
against

Northpole

significantly

arose

similar

Tofasco. (Doc. 30).

to

out

of

those

series

against

of

transactions

remaining

defendant

On November 9, 2011, the Court granted
2 

a

Plaintiff’s

motion

to

re-join

Northpole

“to

reconsider

Northpole’s original Motion to Dismiss on the merits.”

(Doc.

36).
II.

Discussion
Title

exceptional
prevailing

25

U.S.C.

cases,
party

in

§

285

award
a

provides
reasonable

patent

that

the

Court

attorney

fees

infringement

may,

action.

in

to

the

In

its

memorandum in support of its Motion for Attorney Fees and Costs
(Doc.

29),

Northpole

describes

the

reasons

this

is

an

“exceptional case” warranting the departure from the traditional
“American Rule” that parties bear their own costs in litigation.
Northpole does not address the other prerequisite for an award
of fees under the cost-shifting statute--the party must be a
“prevailing party.”
The Supreme Court’s decision in Buckhannon Bd. & Care Home,
Inc. v. W.Va. Dep’t of Health & Human Res., 532 U.S. 598 (2001)
sets out the principles that control interpretation of statutes
using the term “prevailing party.”

In Buckhannon, the Supreme

Court addressed whether the term “prevailing party”, a legal
term of art employed in numerous federal statutes, includes “a
party that has failed to secure a judgment on the merits or a
court-ordered consent decree, but that nonetheless achieved the
desired result because the lawsuit brought about a voluntary
change

in

the

defendant’s

conduct.”
3 

Id.

at

600.

The

petitioners in Buckhannon contended that they were entitled to
attorney’s fees under the so called “catalyst theory,” which
states that a party is a “prevailing party,” even absent any
relief on the merits, if it achieves the desired result because
the lawsuit precipitated a voluntary change in the other party’s
conduct.

The

Supreme

Court

rejected

the

catalyst

theory,

requiring instead a judicially sanctioned change in the parties’
legal relationship.

Id. at 605. Therefore, to qualify as a

prevailing party after Buckhannon, a litigant has to obtain a
judgment on the merits, a court-ordered consent decree, or some
other court-ordered action that effects a change in the legal
relationship between the parties.
Although Buckhannon dealt with the Fair Housing Amendments
Act and the Americans with Disabilities Act, the Eighth Circuit
has

agreed

with

other

circuits

in

finding

that

Buckhannon

applies broadly to the fee-shifting statutes that employ the
“prevailing party” language.
Cir.

2002)(Where

a

class

Cody v. Hillard, 304 F.3d 767 (8th
obtained

a

court-ordered

consent

decree, it was clearly a “judicially sanctioned change” in the
parties’ relationship that conferred prevailing party status on
the class of prisoners which brought long-running prison civil
rights litigation.)
In Sierra Club v. City of Little Rock, the plaintiff was
awarded summary judgment.

351 F.3d 840 (8th Cir. 2003). Because
4 

the court refused to grant any of the relief plaintiff sought,
the

declaratory

judgment

enforce.”

The

receive

“enforceable

an

Eighth

did

not

Circuit

constitute

found

judgment”

that

and

any

“relief

plaintiff

was

did

therefore

to
not

not

a

prevailing party.
In Advantage Media, L.L.C. v. City of Hopkins, Minn., 511
F.3d 833 (8th Cir. 2008), a sign company brought a § 1983 action
alleging that the city’s sign code was unconstitutional.
district

court

granted

a

preliminary

injunction

The

halting

enforcement of the code and entered the jury’s verdict awarding
no damages to the company, but the court denied the company’s
motion for attorney’s fees.

On appeal, the Eighth Circuit found

that the injunction in this case had not materially affected the
parties’ legal relationship because the constitutionally suspect
provisions of the sign ordinance had never been applied to the
plaintiff.

Id. at 838.

The Court in Advantage looked to the

Supreme Court’s recent decision in Sole v. Wyner to support the
result.

The

Court

in

Sole

stated

that

“[p]revailing

party

status...does not attend achievement of a preliminary injunction
that is reversed, dissolved, or otherwise undone by the final
decision

in

the

same

case.”

551

U.S.

74,

83

(2007).

A

plaintiff who “secures a preliminary injunction, then loses on
the merits as the case plays out and judgment is entered against

5 

her has won a battle but lost the war.”

Advantage Media at 838

(internal citations omitted).
While it was successful in its attempt to gain dismissal
following what Plaintiff described as his attorney’s “scheduling
error”,

Northpole’s

dismissal

was

without

prejudice

and

the

Court specifically ordered that Northpole be rejoined as a party
in order for a determination to be made on its Motion to Dismiss
on Grounds of Equitable Estoppel. (Doc. 36).

The Court has not

made any decision as yet on the merits of the parties’ claims
and

neither

party

has

received

an

enforceable

qualify it for prevailing party status.

judgment

to

Unless and until the

Court rules on the Motion to Dismiss and creates a judicially
sanctioned, material alteration of the legal relationship of the
parties, there can be no prevailing party.
III.

Conclusion
Accordingly, Northpole’s Motion for Attorney Fees and Costs

(Doc. 28) is DENIED.
It is so ordered this 6th Day of April, 2012.

/s/ Robert T. Dawson
Honorable Robert T. Dawson
United States District Judge

6