by Dennis Crouch
WC Realty recently filed a petition for certiorari that builds upon and expands the issues presented in the Property Matters case that I wrote about recently. Both cases focus on whether a voluntary dismissal of a copyright infringement action under Rule 41(a)(1) bars “prevailing party” status under §505 of the Copyright Act. Under Section 505, “the court may also award a reasonable attorney’s fee to the prevailing party.” This is almost identical to the Patent Act’s fee shifting provision except that patent law limits discretion to “exceptional cases.” 35 U.S.C. 285.
The petition presents two distinct but related questions about how voluntary dismissals should be handled under §505 of the Copyright Act. The first question addresses the fundamental threshold issue: whether a defendant can even qualify as a “prevailing party” after a plaintiff voluntarily dismisses under Rule 41(a)(1). The Eleventh Circuit has created a categorical bar, holding that defendants cannot be prevailing parties without court-ordered dismissal, even when the dismissal is “with prejudice” and precludes refiling. The second question examines how voluntary dismissals should be weighed when courts exercise their discretion to award fees under §505.
Voluntary Dismissals and Attorney Fees
The case arose when Affordable Aerial Photography (AAP) sued WC Realty for copyright infringement over real estate photographs. After WC Realty incurred substantial defense costs, AAP voluntarily dismissed its claims “with prejudice” under Rule 41(a)(1). The district court denied WC Realty’s request for attorney’s fees, and the Eleventh Circuit affirmed, holding that WC Realty could not be a “prevailing party” because there was no “judicial action rejecting or rebuffing” AAP’s claims.
