McCarthy v. Oregon Freeze Dry, Inc.

• Jurisdiction: Oregon
• Court: Oregon Court of Appeals
• Writing for the Court: Before HASELTON, Presiding Judge, and LANDAU and ARMSTRONG; LANDAU
• Citation: McCarthy v. Oregon Freeze Dry, Inc., 976 P.2d 566, 158 Or.App. 654 (Or. App. 1999)
• Decision Date: 03 March 1999
• Parties: Terry B. McCARTHY, Appellant, v. OREGON FREEZE DRY, INC., an Oregon corporation, Respondent. 93-0020; CA A87840.

Page 566

976 P.2d 566

158 Or.App. 654

Terry B. McCARTHY, Appellant, v. OREGON FREEZE DRY, INC., an Oregon corporation, Respondent.

93-0020; CA A87840.

Court of Appeals of Oregon.

Submitted on Remand June 26, 1998.

Decided March 3, 1999.

Nickolas Facaros, Gildea & Facaros, Eugene, and Emmons, Kropp, Kryger, Alexander, Egan & Allen, Albany, for appellant.

William F. Gary, Judith Giers, Emily K. Newton and Harrang Long Gary Rudnick, Eugene, for respondent.

Bruce H. Orr and Meyer & Wyse, LLP, Portland, for motion.

Before HASELTON, Presiding Judge, and LANDAU and ARMSTRONG, Judges.

LANDAU, J.

On remand from the Supreme Court, we are required to re-examine and explain the basis for our award of attorney fees to defendant. Based on the rule acknowledged in the line of cases culminating in Schlumberger Technologies, Inc. v. Tri-Met, 145 Or.App. 12, 21 n. 9, 929 P.2d 331 (1996), rev. den. 325 Or. 80, 934 P.2d 1126, modified on other grounds 149 Or.App. 316, 942 P.2d 862 (1997), we adhere to our previous award of $12,000.

Plaintiff sued defendant for, among other things, unlawful employment practices under ORS 659.121. Plaintiff then filed a voluntary notice of dismissal under ORCP 54 A(1), and the trial court entered a judgment of dismissal. Plaintiff later moved to set aside the dismissal for excusable neglect under ORCP 71 B. The trial court denied the motion, concluding that the mistake alleged--failure to "Shepardize" a key case--was not excusable. Plaintiff appealed, we affirmed without opinion, and the Supreme Court eventually denied review. McCarthy v. Oregon Freeze Dry, Inc., 142 Or.App. 595, 922 P.2d 729, rev. den. 324 Or. 322, 927 P.2d 598 (1996).

After we affirmed without opinion, defendant petitioned for $18,268 in attorney fees under ORS 659.121(1), arguing: (a) that, contrary to our holdings in the Schlumberger line of cases, all it needed to show to be entitled to an award was that it was the prevailing party; and (b) that even if it also had to show that plaintiff's arguments were frivolous, it had done so. Plaintiff had two types of objections. First, plaintiff objected to the amount of the fees on the grounds that the total hours billed for writing the brief were excessive and that plaintiff should not have to pay for the hours that defendant's attorneys spent in "getting up to speed." Second, plaintiff objected to any fees being awarded on the ground that it was impossible to tell whether the underlying unlawful employment practices action was frivolous because no decision was ever made on the merits. We agreed with the first set of objections, but not with the objection to the fee award in general. Consequently, we issued an order awarding attorney fees, but in the amount of $12,000 rather than $18,268. However, we did not explain the basis for that award.

Plaintiff petitioned for review of the attorney fee award on several grounds, including that ORS 659.121, as we previously construed it, see Schlumberger Technologies, 145 Or.App. at 21 n. 9, 929 P.2d 331, only allows a prevailing defendant to recover attorney fees if the plaintiff's claim was frivolous. The Supreme Court concluded that that construction of ORS 659.121 was a permissible one, but found it impossible to tell whether we had, in fact, made our decision on that basis. Accordingly, the Supreme Court vacated our award of attorney fees and remanded the case to us for further proceedings. McCarthy v. Oregon Freeze Dry, Inc., 327 Or. 84, 957 P.2d 1200 (1998). After reconsidering that decision on its own motion, the Supreme Court further clarified our task on remand as "describ[ing] the relevant facts and legal criteria for the court's decision * * * in any terms that are sufficiently clear to permit meaningful appellate review." McCarthy v. Oregon Freeze Dry, Inc., 327 Or. 185, 190-91, 957 P.2d 1200 (1998).

We now clear up the confusion by rejecting defendant's invitation to nullify the line of cases culminating in Schlumberger Technologies, but accepting defendant's contention that plaintiff's arguments in favor of the motion to set aside were frivolous, unreasonable, or without foundation. At the outset, we note that Robert C. Wyatt, Inc., has moved for permission to appear as amicus curiae in this portion of the appeal. We do not believe that such an appearance would aid us in deciding the case at hand and, therefore, deny the motion.

ORS 659.121(1) provides, in part, "[i]n any suit brought under this subsection [allowing actions for unlawful employment practices], the court may allow the prevailing party costs and reasonable attorney fees at trial and on appeal." Beginning in Dobie v. Liberty Homes, 53 Or.App. 366, 632 P.2d 449 (1981), we have held that the court may award a defendant attorney fees under that statute only when the "plaintiff's claim was frivolous, unreasonable, or without foundation." Id. at 373-74, 632 P.2d 449 (relying on Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 98 S.Ct. 694, 54 L.Ed.2d 648 (1978)). See also Schlumberger Technologies, 145 Or.App. at 21 n. 9, 929 P.2d 331; Robinson v. School District No. 1, 92 Or.App. 627, 632, 759 P.2d 1116 (1988); Payne v. American-Strevell, Inc., 65 Or.App. 265, 268, 670 P.2d 1065 (1983).

Plaintiff's claims with regard to the motion to set aside the voluntary dismissal were "frivolous, unreasonable, or without foundation" both before the trial court and on appeal. Plaintiff argued that the voluntary dismissal he previously obtained should have been set aside for mistake, inadvertence, surprise, or excusable neglect under ORCP 71 B. Essentially, plaintiff argued that the case on which he relied in making the decision to dismiss, Tikka v. Martin, 271 Or. 287, 532 P.2d 18 (1975), was not necessarily controlling. Plaintiff read that case to mean that he could refile another action against defendant after the voluntary dismissal. However, plaintiff noted that, had he conducted a more comprehensive survey of the case law, he would have discovered controlling cases holding that he would, in fact, not be able to refile against defendant.

The decision to set aside or not set aside a judgment based on mistake, inadvertence, surprise, or excusable neglect is committed to the sound discretion of the trial court,...