Opinion ID: 1195085
Heading Depth: 2
Heading Rank: 3

Heading: Denial of Fees and Costs

Text: After the district court dismissed the indictment, Defendants moved for an award of fees and costs under the Hyde Amendment, Pub.L. No. 105-119, § 617, 111 Stat. 2440, 2519 (1997) (codified at 18 U.S.C. § 3006A Note). The Hyde Amendment provides that in a privately defended criminal case, the court may award to a prevailing party, other than the United States, a reasonable attorney's fee and other litigation expenses, where the court finds that the position of the United States was vexatious, frivolous, or in bad faith.... The district court denied the motion on two grounds: (1) Defendants were not prevailing parties because the dismissal was not a judgment on the merits, and (2) although the discovery violations were conducted with bad faith, the entire case was not vexatious, frivolous, or in bad faith. Defendants timely cross-appeal this ruling. We review a district court's denial of a Hyde Amendment motion for abuse of discretion. An abuse of discretion is an error of law or a determination based on a clearly erroneous finding of fact. United States v. Manchester Farming P'ship, 315 F.3d 1176, 1181 (9th Cir.2003) (footnote omitted). The district court correctly determined that Defendants were not prevailing parties under the Hyde Amendment. Although the amendment does not explicitly define the term, we have interpreted prevailing party to mean one who has gained by judgment or consent decree a material alteration of the legal relationship of the parties. Perez-Arellano v. Smith, 279 F.3d 791, 794 (9th Cir.2002) (defining the term under the Equal Access to Justice Act) (internal quotation marks omitted); United States v. Campbell, 291 F.3d 1169, 1172 (9th Cir.2002) (extending the Perez-Arrellano definition to the Hyde Amendment). There can be no doubt that a dismissal with prejudice materially alters the legal relationship of the parties, as it precludes the government from bringing a prosecution that it otherwise would be entitled to bring. However, our cases have also required a prevailing party to have `receive[d] at least some relief on the merits of his claim.' Campbell, 291 F.3d at 1172 (quoting Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health and Human Res., 532 U.S. 598, 603, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001)) (alteration in original) (emphasis added). In Campbell, for example, the defendant's charges were dismissed through his participation in a pre-trial diversion program. Id. at 1171. We held that this did not constitute relief on the merits of his claim and hence Campbell was not a prevailing party under the Hyde Amendment. Id. at 1172. As the district court made clear, the dismissal was not an enforceable judgment on the merits of the case. The court dismissed the indictment based on the government's failure to disclose documents and the prosecutor's affirmative misrepresentations to the court. The district court never suggested that this prosecutorial misconduct was relevant to Defendants' guilt or innocence. Instead, the dismissal was purely intended to sanction the government's flagrant Brady/Giglio and procedural violations and the misrepresentations used to conceal these violations. As in Campbell, the relief was not based on the merits of the case (except as necessary to calculate prejudice), so Defendants are not prevailing parties under the Hyde Amendment. [6] Because this is sufficient in and of itself to affirm the district court's denial of fees and costs, we need not review the court's finding that the overall case was not vexatious, frivolous, or in bad faith.