Crying “Uncle” Does Not Affect Prevailing Party Status
July 30, 2014The issue in this case was whether the trial court erred in awarding attorneys’ fees to the defendant when the plaintiff dropped its claim under the Texas Theft Liability Act (“TTLA”) a few days after the defendant filed a motion for summary judgment.
Under the TTLA, the prevailing party is entitled to recover attorneys’ fees. In this case, the plaintiff brought a TTLA claim against the defendant. When the defendant moved for summary judgment, the plaintiff must have realized that it was going to lose. Consequently, the plaintiff amended its complaint and removed the TTLA claim, effectively nonsuiting it. Thus, the plaintiff claimed that the defendant was not a prevailing party and therefore not entitled to attorneys’ fees.
The Court of Appeals affirmed the trial court’s decision to award attorneys’ fees, holding that a party is still a prevailing party if the nonsuit was taken to avoid an unfavorable ruling on the merits. This result was further cemented by the fact that at the hearing on attorneys’ fees, plaintiff’s attorney acknowledged that by filing its nonsuit the plaintiff “basically, said ‘Uncle.'”
