Cadkin v. Loose, 2009 WL 1813263 (9th Cir. 2009).
Plaintiff brought a complaint against a Defendant for, inter alia, copyright infringement. After extensive settlement discussions, an amended complaint, and a denied motion to remand, the Defendant moved to dismiss the complaint without leave to amend. The Plaintiff opposed the motion and lodged notice of voluntary dismissal of its claim under FRCP 41(a)(2). The Central District of California granted voluntary dismissal.
17 U.S.C. 505 of the Copyright Act states that a court may award reasonable attorneys’ fees to the “prevailing party.” The district court found that the Defendant was a prevailing party even though the complaint was dismissed without prejudice and the Plaintiff was free to refile. The Court relied on the Ninth Circuit’s World War II era precedence, Corcoran v. Columbia Broadcasting System, Inc., 121 F.2d 575, 576 (9th Cir.1941).
On appeal, the Ninth Circuit found (Fletcher, Gould, Fisher writing) that the sixty-eight year old case was no longer good law. The Circuit found that for a party to be prevailing, there must be a “material alteration of the legal relationship of the parties.”:
The Supreme Court, in the context of the Fair Housing Amendments Act (FHAA), has since held prevailing party status turns on whether there has been a “material alteration of the legal relationship of the parties,” Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health & Human Res., 532 U.S. 598, 604, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001) (internal quotation marks omitted), and we have held dismissal without prejudice does not alter the legal relationship of parties for the purposes of entitlement to attorney’s fees under a comparable fee shifting statute, see Oscar v. Alaska Dep’t of Educ. & Early Dev., 541 F.3d 978, 981 (9th Cir.2008).
We conclude Corcoran is clearly irreconcilable with Buckhannon and no longer good law. We therefore overrule Corcoran and hold Buckhannon’s material alteration test applies to § 505 of the Copyright Act. See Miller v. Gammie, 335 F.3d 889, 893 (9th Cir.2003) (en banc) (holding thee-judge panel can reject prior panel opinion that is “clearly irreconcilable” with intervening Supreme Court authority). Because the plaintiffs in this lawsuit remained free to refile their copyright claims against the defendants in federal court following their voluntary dismissal of the complaint, we hold the defendants are not prevailing parties and thus not entitled to the attorney’s fees the district court awarded them.
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