Opinion
Civil Docket No.: CL15-9608
03-02-2017
Re: MAMA/TMU, LLC v. James H. Miller, Jr.
Nathaniel R. Pierce, Esquire
Julia Rust, Esquire
PIERCE MCCOY, PLLC
101 West Main Street, Suite 101
Norfolk, Virginia 23510 Mark R. Baumgartner, Esquire
PENDER & COWARD, P.C.
222 Central Park Avenue, Suite 400
Virginia Beach, Virginia 23462 Dear Counsel:
Today the Court rules on cross motions for attorneys' fees and costs filed by Plaintiff MAMA/TMU, LLC ("MAMA") and Defendant James Miller ("Miller"), which stem from litigation associated with the proposed sale of MAMA. The three issues related to the motions are as follows: under the attorneys' fee provision of an agreement to which MAMA and Miller are parties, (1) whether MAMA is a prevailing party based on the Court having granted in part its motion for summary judgment, (2) whether Miller is a prevailing party based on the Court having granted his motion to compel discovery responses as well as his motion for MAMA to show cause why it should not be held in contempt, and (3) whether Miller is a prevailing party based on the eventual termination of the proposed sale of MAMA, which was the catalyst for the litigation.
The Court finds as follows: (1) MAMA is not a prevailing party because the Court's Order regarding MAMA's motion for summary judgment did not dismiss with prejudice any of Miller's claims, (2) Miller is not a prevailing party because the discovery-related motions did not provide relief sought by Miller, and (3) Miller is not a prevailing party based on the termination of the proposed sale of MAMA because such action was not relief sought by Miller.
Because neither party is a prevailing party as contemplated by their agreement, the Court DENIES MAMA's motion for attorneys' fees and costs and DENIES Miller's motion for attorneys' fees and costs.
Background
In 2007, Miller owned the Tidewater School of Navigation, which was formed to train maritime workers. (Countercl. 1.) Miller subsequently formed MAMA, LLC and enlisted investors to fund the LLC. In 2008, the investors formed a new company, The Maritime University, LLC ("TMU"), which provided marine engineering training and in which Miller was not invited to participate. (Countercl. 2.) In 2009, Miller filed a complaint against certain members of MAMA, LLC for willful breach of the LLC's Operating Agreement and a derivative action on behalf of MAMA, LLC against the same members for "conspiring to misappropriate assets of MAMA[, LLC] and divert them to their own company, TMU." (Countercl. 2.) The parties ultimately entered into a settlement agreement to resolve that litigation. Pursuant to the settlement agreement, MAMA, LLC and TMU were placed under a single umbrella entity: MAMA/TMU, LLC, i.e., MAMA. (Id. at 29.)
MAMA's Operating Agreement (the "Operating Agreement"), to which Miller—as a Member of MAMA—is a party, contains an attorneys' fee provision (the "Attorneys' Fee Provision") that reads as follows:
In the event of any action at law, in equity, arbitration or otherwise between the parties in relation to this Agreement, the non-prevailing party shall pay to the prevailing party all costs and expenses of such litigation, including, but not limited to reasonable actual attorneys' fees in addition to any other sums which the non-prevailing party may be required to pay pursuant to this Agreement and/or court order or arbitration award. A party shall be a prevailing party if it obtains any relief sought that is not offered by the other party prior to the order or award regardless of whether the prevailing party obtains all or only a portion of the relief sought.(Countercl., Ex. 1, § 17.08.)
In July 2015, MAMA entered into an "asset purchase agreement" pursuant to which a purchaser offered to purchase all of MAMA's assets and assume all of its liabilities at a purchase price of $7,200,000 (the "Asset Sale"). (Compl. 2-3.) MAMA noticed a special meeting of its members to vote on approval of the Asset Sale and subsequent dissolution and winding up of MAMA. (Id. at 3.) At the time MAMA filed suit, "eleven out of thirteen members comprising a majority in percentage of the membership interest of [MAMA] ha[d] submitted their proxy votes to [MAMA's] management approving the Asset Sale and performing a dissolution and winding up of its affairs." (Id.) The purchaser was to provide promissory notes to MAMA's members in proportion to their respective membership interests after the Asset Sale. (Countercl. 3.) The then-former members of MAMA—other than Miller—would have the opportunity to contribute their promissory notes to the new, purchaser-controlled entity in exchange for a membership interest in the new entity, resulting in a new entity without Miller as a member. (Id.)
Although a December 31, 2014, valuation concluded that MAMA's value was $7,200,000, a September 30, 2014, valuation—completed only 3 months earlier—concluded that its value was $2,800,000. (Compl. 2.)
MAMA filed suit on September 21, 2015 ("Complaint"), seeking a declaratory judgment specifying the following: (i) that the Asset Sale and subsequent termination of MAMA requires only a majority vote of MAMA's members; (ii) that the Asset Sale and subsequent corporate termination does not adversely affect Miller's membership interest as defined by the Operating Agreement; and (iii) that the fair market value of MAMA for purposes of the Asset Sale does not exceed the December 31, 2014, valuation. (Compl. 6-7.) MAMA also prayed that it be awarded its attorneys' fees and costs related to the litigation. (Id. at 7.) Miller filed a Counterclaim on October 13, 2015 ("Counterclaim"), in which he sought an order declaring that the consent of a super-majority of MAMA's members is required for approval of the Asset Sale and subsequent termination of MAMA and that he be awarded his attorneys' fees and costs related to the litigation. (Countercl. 6.)
MAMA filed a motion for summary judgment on Miller's Counterclaim on December 4, 2015, and Miller filed motions for summary judgment on his Counterclaim and on MAMA's Complaint on January 29, 2016. After a hearing, as well as pre- and post-hearing briefing, the Court granted in part and denied in part MAMA's motion for summary judgment and denied Miller's motions for summary judgment. (May 16, 2016, Order.) After discovery commenced, Miller filed a motion to compel MAMA to answer certain written discovery requests; after a hearing, the Court granted in part Miller's motion to compel and took one matter under advisement to allow an in camera review of several documents to determine whether certain privileges could be invoked by MAMA that would preclude production. (June 10, 2016, Order.) The Court subsequently granted Miller's motion to compel production of some of the documents the Court reviewed in camera. (July 21, 2016, Order.) After MAMA failed to produce to Miller any of the documents the Court ordered it to produce, Miller filed a motion to show cause why MAMA should not be held in contempt of court, which the Court granted. (Aug. 5, 2016, Order.) After submission and review of related pre-hearing briefs and a hearing, the Court entered an Order on Show Cause, in which it ordered MAMA to, inter alia, pay $1,000 to Miller. (Nov. 16, 2016, Order on Show Cause.)
The Asset Sale apparently was terminated sometime after the hearing on the cross motions for summary judgment. Miller moved for entry of a nonsuit of the claims in his Counterclaim, as amended, which the Court granted (Oct. 27, 2016, Order), and MAMA moved for entry of a nonsuit of the claims in its Complaint, as amended, which the Court also granted (Nov. 16, 2016, Order). The Court expressly reserved jurisdiction to determine which party, if any, is entitled to recover attorneys' fees and costs pursuant to the Operating Agreement and granted the parties leave to file briefs on that issue. (Id.)
Positions of the Parties
MAMA
MAMA argues that under a "fair reading" of the Attorneys' Fee Provision, it is a prevailing party, thus requiring Miller to pay its attorneys' fees and costs. (Pl.'s Mot. for Att'ys' Fees 3.) MAMA asserts that the only interlocutory orders that can be considered for purposes of determining a prevailing party are those that are granted, as opposed to those that are denied, dismissed, or nonsuited. (Id.) MAMA points out that, among the various summary judgment motions, it was the only party to receive any affirmative relief, i.e., the Court granting in part its motion for summary judgment on Miller's Counterclaim. (Id.)
MAMA argues that Miller cannot be considered a prevailing party based on termination of the Asset Sale, as Miller asserts. (Pl.'s Rebuttal to Def.'s Claim for Att'ys' Fees 2.) It contends that because Miller requested in his Counterclaim that the Court declare that a super-majority vote was required to approve the Asset sale—and not to terminate the proposed sale—such termination does not constitute relief sought by Miller. (Id.) MAMA also argues that Miller's alleged success on any discovery-related orders does not constitute relief related to the Operating Agreement and therefore precludes qualifying Miller as a prevailing party. (Id. at 4.) MAMA contends that discovery-related orders, unlike the summary judgment order that partially granted MAMA's motion, are procedural and do not specifically relate to issues within the Operating Agreement. (Id.)
MAMA also asserts that the purchaser—and not MAMA—terminated the sale. (Pl.'s Rebuttal to Def.'s Claim for Att'ys' Fees 4.)
Miller
Miller argues that because the ultimate goal of his Counterclaim was to prevent the Asset Sale from taking place, termination of the sale effectively provided him the relief he sought, thereby qualifying him as a prevailing party. (Def.'s Br. in Support of Mot. Att'ys' Fees 5; Def.'s Resp. to Pl.'s Mot. for Att'ys' Fees 2-3.) Miller also asserts that the partial summary judgment awarded to MAMA did not actually grant relief to anyone; he avers that the Court simply ruled that there was no per se requirement for super-majority approval of asset sales and that there remained material factual disputes regarding whether a super-majority vote was required to approve the specific sale, dissolution, and winding up being contemplated. (Def.'s Resp. to Pl.'s Mot. for Att'ys' Fees 2.) Miller contends that for MAMA to have obtained the relief it sought, the Court would have had to order that the Asset Sale and subsequent termination of MAMA—the specific transaction proposed—required approval by only a simple majority of MAMA's members, which the Court did not do. (Id.)
Miller also argues that, other than the summary judgment order, all other interlocutory orders were granted in his favor, thereby providing him "affirmative relief and making him a prevailing party. (Def.'s Br. in Support of Mot. Att'ys' Fees 5.) In addition to the Court granting Miller's motion to compel, Miller notes that MAMA was required to pay Miller $1,000 as a result of the Court's Order on Show Cause. (Def.'s Resp. to Pl.'s Mot. for Att'ys' Fees 4.)
Analysis
Legal Standard
It is the duty of the court to construe and enforce the clear and unambiguous language to which parties agree when forming a contract. See Mgmt. Enters., Inc. v. Thorncroft Co., 243 Va. 469, 472, 416 S.E.2d 229, 231 (1992). "When the terms of the parties' contracts are unambiguous, the interpretation of those terms presents a question of law." Waikoloa Ltd. P'ship v. Arkwright, 268 Va. 40, 46, 597 S.E.2d 49, 53 (2004). "When a contract is complete on its face and is plain and unambiguous in its terms, a court is not free to search for its meaning beyond the contract itself." Aetna Cas. & Sur. Co. v. Fireguard Corp., 249 Va. 209, 215, 455 S.E.2d 229, 232 (1995). Only where the language is ambiguous—that is, capable of being understood "in more than one way, or referring to two or more things at the same time"—should a court seek to "ascertain the true intention of the parties." Id.
Pursuant to the "American Rule," parties to a civil case generally pay their own attorneys' fees and costs of litigation. See Nusbaum v. Berlin, 273 Va. 385, 400, 641 S.E.2d 494, 501 (2007). "This rule, however, does not prevent parties to a contract from adopting provisions that shift the responsibility of attorneys' fees to the losing party in disputes involving the contract." Dewberry & Davis, Inc. v. C3NS, Inc., 284 Va. 485, 495, 732 S.E.2d 239, 243 (2012).
The U.S. Supreme Court has made clear "'that a plaintiff [must] receive at least some relief on the merits of his claim before he can be said to prevail.'" Buckhannon Bd. & Care Home v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 603-04 (2001) (quoting Hewitt v. Helms, 482 U.S. 755, 760 (1987)), abrogated in part on other grounds as stated in Warren v. Colvin, 744 F.3d 841, 845 (2d Cir. 2014). "Relief is defined as "[t]he redress or benefit, esp[ecially] equitable in nature . . . , that a party asks of a court[, a]lso termed remedy," and "merits" is defined as "[t]he elements or grounds of a claim or defense." BLACK'S LAW DICTIONARY (10th ed. 2014).
A party may voluntarily nonsuit a claim under Virginia law. See Va . Code Ann. § 8.01-380 (2015 Repl. Vol.). Nonsuits are not granted based on the merits of a particular case. Sheets v. Castle, 263 Va. 407, 413, 559 S.E.2d 616, 620 (2002). "'[T]he action' subject to a plaintiff's nonsuit request is comprised of the claims and parties remaining in the case after any other claims and parties have been dismissed with prejudice or otherwise eliminated from the case." Dalloul v. Agbey, 255 Va. 511, 514, 499 S.E.2d 279, 281 (1998). "[T]here is no 'prevailing party' when a nonsuit is awarded. Sheets, 263 Va. at 414, 559 S.E.2d at 620.
Discussion
The Court has considered the pleadings and applicable authorities, and it now rules on the cross motions for attorneys' fees.
Provisions awarding attorneys' fees and litigation costs to a prevailing party are frequently found in contracts. The first part of the Attorneys' Fee Provision in the Operating Agreement is typical of this type of provision. It states that "[i]n the event of any action at law [or] in equity . . . between the parties in relation to this Agreement, the non-prevailing party shall pay to the prevailing party all costs and expenses of such litigation, including, but not limited to reasonable actual attorneys' fees." (Countercl., Ex. 1, § 17.08.) A plain reading of this sentence reveals that the non-prevailing party is required to pay to the prevailing party all of the prevailing party's attorneys' fees and litigation costs.
What makes the fee provision at issue here somewhat unique—and arguably more complex—is its second sentence, which defines a "prevailing party" as a party that "obtains any relief sought that is not offered by the other party prior to the [court] order . . . regardless of whether the prevailing party obtains all or only a portion of the relief sought." (Id. (emphasis added).) When "contract terms are clear and unambiguous, [the court] must construe those terms according to their plain meaning." Hutter v. Heilmann, 252 Va. 227, 231, 475 S.E.2d 267, 270 (1996). Because the term "prevailing party" is unambiguous in the context of the Operating Agreement, the court interprets the term as a matter of law. Waikoloa Ltd. P'ship v. Arkwright, 268 Va. 40, 46, 597 S.E.2d 49, 53 (2004). The Court holds that the clear intent of the Attorneys' Fee Provision is that a party can be declared a prevailing party based only on the Court's partial grant of "the relief sought."
The Attorneys' Fee Provision fails to define "the relief sought," however. As an initial matter, the provision expressly provides that such relief must be memorialized in a court order, which is consistent with the firmly established rule in Virginia that a trial court speaks only through its written orders. Davis v. Mullins, 251 Va. 141, 148, 466 S.E.2d 90, 94 (1996). The Court further holds that "the relief sought" refers to relief on the merits, i.e., relief specifically prayed for in MAMA's Complaint or Miller's Counterclaim. Buckhannon Bd. & Care Home v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 603 (2001) (holding "'that a plaintiff [must] receive at least some relief on the merits of his claim before he can be said to prevail'" (emphasis added) (quoting Hewitt v. Helms, 482 U.S. 755, 760 (1987), abrogated in part on other grounds as stated in Warren v. Colvin, 744 F.3d 841, 845 (2d Cir. 2014); see also Sheets v. Castle, 263 Va. 407, 414, 559 S.E.2d 616, 620 (2002) (holding that a prevailing party is "the party in whose favor the decision or verdict in the case is or should be rendered and judgment entered"—the one that, "in the view of the law, succeeded in the action").
The Court limits its analysis to the litigation arena, although the Attorneys' Fee Provision also addresses disputes in "arbitration or otherwise." (Countercl., Ex. 1, § 17.08.)
A contrary reading—that "relief sought" refers to any Court ruling in response to a party's motion—would lead to nonsensical results. For example, a party whose opposed motion for a continuance was granted would be a prevailing party. Similarly, a party would be non-prevailing if a court granted the opposing party's motion to compel—even if the "non-prevailing" party held a good-faith belief that its initial discovery response was adequate. In other words, "non-prevailing" parties that lose even relatively minor substantive or procedural motions would be required to pay all of the prevailing party's attorneys' fees and costs related to the entire litigation. This seemingly would be true even if that non-prevailing party ultimately obtained final judgment on the merits; in such a scenario, each party would be both a prevailing party and a non-prevailing party—despite a clear substantive victory on the merits by only one of the parties. Such a reading of the Attorneys' Fee Provision would lead to each side paying the other side's fees and costs in virtually every case, as each party likely could ensure it prevailed on at least some minor issue during the course of the litigation. The Court finds that the language of the Operating Agreement does not support such absurd results.
The Court therefore holds that declaration of a prevailing party under the Operating Agreement is predicated on the Court awarding or denying a party all or part of the relief on the merits, as prayed for in its Complaint or Counterclaim, even if such relief is "only a portion of the relief sought."
A. MAMA is not a prevailing party under the Operating Agreement based on the Court granting in part its motion for summary judgment.
As discussed supra, the Court denied Miller's motions for summary judgment but granted in part MAMA's motion for summary judgment on Miller's Counterclaim. Specifically, the partial grant was based on the Court finding that super-majority approval by MAMA's members is not necessarily required for any sale or transfer of all, or substantially all, of MAMA's assets. MAMA asserts that this finding makes it a prevailing party.
As an initial matter, denial of a motion for summary judgment does not constitute relief granted to the non-moving party, as the dispute remains unresolved and continues toward trial as if the motion had never been filed. Further, in light of the nonsuits of the Complaint and the Counterclaim, the partial grant of summary judgment—without granting relief on the merits—has no res judicata effect on any refiled suit, as all previous non-final judgments are moot. See Dalloul v. Agbey, 255 Va. 511, 514, 499 S.E.2d 279, 281 (1998) ("'[T]he action' subject to a plaintiff's nonsuit request is comprised of the claims and parties remaining in the case after any other claims and parties have been dismissed with prejudice or otherwise eliminated from the case."); see also Wilby v. Gostel, 265 Va. 437, 444, 578 S.E.2d 796, 800 (2003) (holding that res judicata applied only to counts dismissed with prejudice prior to the nonsuit).
Because Miller's motions were denied, the only issue regarding the motions for summary judgment is whether MAMA is a prevailing party. In the Court's February 29, 2016, Letter Opinion—the findings of which were incorporated into a May 16, 2016, Court Order—the Court explained that although Miller in his Counterclaim sought an order declaring that the consent of a super-majority of MAMA's members is required for approval of the Asset Sale, the Court nevertheless elected to resolve the issue of whether a super-majority vote necessarily is required for any sale of all, or substantially all, of MAMA's assets. The Court reasoned that "because Miller's underlying argument regarding how the Asset Sale and termination adversely affect his membership interest applies to any termination of MAMA, the Court finds it appropriate to address Miller's Counterclaim as if it asks the Court to find that super-majority approval is required for the sale of all, or substantially all, of MAMA's assets." (Feb. 29, 2016, Letter Op. 7 (emphasis added).) The Court's rationale was that if a super-majority vote is required for any sale of all, or substantially all, of MAMA's assets, a super-majority vote necessarily was required for the specific Asset Sale at issue. The Court ultimately held that "the Operating Agreement does not require super-majority approval of the members to sell or transfer all, or substantially all, of MAMA's assets," and granted in part MAMA's motion for summary judgment. (Id. at 8-9.)
In fact, the Court specifically found that MAMA was not—at least at that point in the proceedings—entitled to the relief it sought because "whether the sale or transfer of all, or substantially all, of MAMA's assets and subsequent termination of the LLC against the will of one of its members adversely affects that member's interest is a factual matter that requires valuation of MAMA; and . . . whether the proposed sale or transfer of all, or substantially all, of MAMA's assets and subsequent termination of the LLC circumvent[s], alter[s], or amend[s] the Settlement Agreement cannot be determined, as a matter of law, based on the information the parties provided to the Court." (Feb. 29, 2016, Letter Op. 2.)
The Court's partial grant of summary judgment did not dismiss with prejudice any count or claim in the Counterclaim, however. Stated differently, the Court's ruling that the sale of all of MAMA's assets does not require a super-majority vote did not resolve or dispose of the issue of whether a super-majority vote is required for approval of the Asset Sale—the only relief sought in the Counterclaim other than recovery of fees and costs. Although the Court's ruling on MAMA's motion for summary judgment undoubtedly was adverse to Miller, it did not dismiss any count or claim in Miller's Counterclaim; hence, it did not grant MAMA relief on the merits. See Wilby, 265 Va. at 446, 578 S.E.2d at 801 (affirming the trial court's ruling that the plaintiff could take a voluntary nonsuit as to her entire cause despite the trial court granting in part the defendant's motion for summary judgment because the partial grant "did not dismiss any count or claim in the motion for judgment"); see also Sierra Club v. City of Little Rock, 351 F.3d 840, 844 (8th Cir. 2003) (holding that Sierra Club was granted no actual relief and could not be considered a prevailing party even though it was granted partial summary judgment). Had Miller not nonsuited his Counterclaim, he still could have prevailed—just not on the ground that any sale of all assets requires a super-majority vote. In short, MAMA did not succeed in having any relief on the merits sought by Miller in his Counterclaim dismissed with prejudice.
MAMA therefore is not a prevailing party under the Operating Agreement based on the Court granting in part its motion for summary judgment.
B. Miller is not a prevailing party under the Operating Agreement based on the Court granting his discovery-related motions.
Miller asserts that he is a prevailing party because the court granted several discovery-related motions he filed. Specifically, his motion to compel MAMA to respond to discovery requests was granted, his motion for MAMA to show cause why it should not be held in contempt for continued failure to respond to discovery was granted, and an order on show cause—which required MAMA to, inter alia, pay $1,000 to Miller—was entered against MAMA as a result of his motion to show cause.
MAMA argues that the Court's granting of discovery-related orders does not trigger fee-shifting under the Attorneys' Fee Provision because such orders do not relate to the Operating Agreement. This is a misreading of the fee provision. In order to trigger the fee-shifting provision in the first place, it is only the "action at law" or "in equity"—for purposes of litigation—that must be "in relation to" the Operating Agreement, and it is undisputed that the Complaint and the Counterclaim relate to the Operating Agreement. Once the fee provision is triggered, all of the prevailing party's attorneys' fees related to the litigation are shifted to the non-prevailing party, even those stemming from ancillary matters. The discovery-related orders at issue clearly stem from this litigation, so the associated fees would be included amongst the fees to be paid by the non-prevailing party—if the Attorneys' Fees Provision is triggered in the first place.
Even a purely procedural matter, such as a motion for a continuance, would not have to relate to the Operating Agreement in order to be included among the attorneys' fees to be paid by the non-prevailing party. --------
Miller's victory on these discovery matters, however, does not trigger the Attorneys' Fee Provision. Under the express language of the Operating Agreement, the orders must provide relief on the merits as sought in the Counterclaim in order to qualify Miller as a prevailing party. Because the discovery-related orders did not obtain any relief on the merits for Miller, the Attorneys' Fee Provision is not implicated. As discussed supra, this finding is supported by the fact that the discovery-related orders are not binding now that the Complaint and the Counterclaim have been nonsuited; neither the order compelling MAMA nor the order on show cause are considered final judgments on the merits by which Miller, "in view of the law, succeeded in the action." Sheets v. Castle, 263 Va. 407, 414, 559 S.E.2d 616, 620 (2002).
Miller therefore is not a prevailing party under the Operating Agreement based on the Court granting his motions to compel and to show cause or the Court's order on show cause.
C. Miller is not a prevailing party under the Operating Agreement based on termination of the Asset Sale.
Miller argues that, in light of the circumstances, he prevailed because the proposed sale that initiated the dispute ultimately was terminated. Miller asserts that, because the termination resulted in nonsuit of both the Complaint and the Counterclaim, the Court did not have to reach the issue of the vote required for approval of the Asset Sale. He contends that he therefore "effectively obtained the relief he sought."
As discussed supra, the Court holds that the clear intent of the Attorneys' Fee Provision is that a party is a prevailing party in litigation only if the Court grants relief on the merits, as specifically prayed for in either the Complaint or the Counterclaim. Although Miller's ultimate goal arguably was termination of the Asset Sale, he did not seek such relief in his Counterclaim; rather, he sought a declaration regarding voting requirements. The Court understands that a party may bring suit for a variety of reasons, with motivational factors perhaps extending beyond the relief prayed for. The Court finds no support in law, however, for the proposition that outcomes springing from such external motivations—not expressed as relief sought—have bearing on who qualifies as a prevailing party. In short, the Court finds that termination of the Asset Sale was not relief sought by Miller for purposes of the Attorneys' Fee Provision.
Any benefit to Miller resulting from the termination of the proposed sale also did not stem from a Court order or other judicial action and therefore cannot justify qualifying Miller as a prevailing party under the Operating Agreement. The U.S. Supreme Court has opined as follows:
A defendant's voluntary change in conduct, although perhaps accomplishing what the plaintiff sought to achieve by the lawsuit, lacks the necessary judicial imprimatur on the change. Our precedents thus counsel against holding that the term "prevailing party" authorizes an award of attorney's fees without a corresponding alteration in the legal relationship of the parties.Buckhannon Bd. & Care Home v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 605 (2001), abrogated in part on other grounds as stated in Warren v. Colvin, 744 F.3d 841, 845 (2d Cir. 2014).
Miller therefore is not a prevailing party under the Operating Agreement based on termination of the Asset Sale.
Conclusion
For the foregoing reasons, the Court finds that neither party is a prevailing party as defined by the Operating Agreement, so the Attorneys' Fee Provision is not implicated. The Court therefore DENIES MAMA's motion for attorneys' fees and costs and DENIES Miller's motion for attorneys' fees and costs. Each party therefore is responsible for its own attorneys' fees and costs.
Attached is an Order consistent with the ruling in this Opinion.
Sincerely,
/s/
David W. Lannetti
Circuit Court Judge DWL/jmk