The US Third Circuit Court of Appeals has upheld a trial court ruling awarding Federal Signal Corporation more than $127,000 in legal fees and costs from a group of eleven current and former Washington DC firefighters.
The suit was originally filed in the Court of Common Pleas of Philadelphia County on January 26, 2015, against E-One, Inc., Pierce Manufacturing, Inc, Seagrave Fire Apparatus, LLC, and Federal Signal Corporation for product liability associated with their hearing loss. The firefighters claimed “they suffered occupational hearing loss due to the ‘omni-directional design’ of Federal Signal’s sirens which ‘unnecessarily exposed the firefighters to dangerous levels of sound.’”
The defendant manufacturers had the case removed to federal court, and thereafter established that the firefighters (1) had failed to conduct a meaningful pre-litigation investigation before filing suit, (2) filed the suit after the statute of limitation had expired, and (3) “that one firefighter had not even suffered hearing loss attributable to noise exposure.” At that point the firefighters sought to voluntarily dismiss the suit, but Federal Signal refused to consent to that demanding instead that it be reimbursed for its costs and attorneys fees.
The trial court awarded Federal Signal $127,823.47, and the firefighters appealed. The issues on appeal are somewhat complicated, the details of which are not of particular interest to non-attorneys. For the attorneys, I would recommend you review the entire decision with a focus on the risks associated with unilateral voluntary dismissals.
For everyone else, here are some of the key points in the 3rd Circuit’s decision:
- As to a litigant’s failure to perform a meaningful pre-suit investigation, we start by noting that this standard constitutes a high bar for litigants to meet.
- The run-of-the-mill case will not meet such a bar, even when a jurist believes that a more thorough pre-suit investigation should have been conducted.
- The instant case, however, provides an example of the very sort of exceptional circumstances warranting an award of attorneys’ fees and costs.
- We turn first to the circumstances surrounding Turner, a plaintiff who did not even suffer the type of hearing loss alleged in the underlying lawsuit.
- Had Plaintiffs’ counsel even looked at Turner’s audiograms, he would have recognized the deficiency in the claim.
- In awarding attorneys’ fees and costs, the District Court’s analysis did more than take account of the lack of meaningful pre-suit preparation.
- Specifically, the District Court considered circumstances that extended beyond the geographic boundaries that make up the Eastern District of Pennsylvania.
- Plaintiffs’ counsel makes much of this portion of the District Court’s opinion, going as far as stating that the District Court “appoint[ed] itself the policeman of this nationwide litigation” by “unilaterally usurp[ing] the powers of the other courts.”
- Putting aside counsel’s overheated rhetoric, we conclude that the District Court did not abuse its discretion when it explicitly considered the entirety of this “nationwide litigation.”
- Although attorneys’ fees and costs are typically not awarded when a matter is voluntarily dismissed with prejudice under Rule 41(a)(2), we conclude that such an award may be granted when exceptional circumstances are demonstrated.
- Exceptional circumstances include a litigant’s failure to perform a meaningful pre-suit investigation, and a repeated practice of bringing claims and dismissing them with prejudice after inflicting substantial costs on the opposing party and the judicial system.
- As those exceptional circumstances were present in this case, we conclude that the District Court did not abuse its discretion in awarding attorneys’ fees and costs.
- The District Court’s judgment will be affirmed.
Here is a copy of the decision: Carroll v. E One Inc._ 2018 U.S. App. LEXIS 16600