Save the Tivoli, Inc. v. United States Department of Housing and Urban Development

Save the Tivoli, Inc. v. United States Department of Housing and Urban Development addresses the issue of recovery of attorneys' fees and costs under the National Historic Preservation Act (NHPA) when the parties settle a case. The issue arose when a nonprofit corporation and three individuals interested in the preservation and rehabilitation of the historic Tivoli Theater in Washington, D.C., sued the Department of Housing and Urban Development (HUD) and the District of Columbia Department of Housing and Community Development. After the parties settled the case and the court entered a consent decree, plaintiffs sought recovery of attorneys' fees and costs.

The district court turned to the attorneys' fees provision of NHPA to determine whether fees and costs could be awarded. This provision provides that a "court may award attorneys' fees, expert witness fees, and other costs . . . as the court deems reasonable" where a plaintiff "substantially prevails" in a civil action filed in a Federal district court. Because neither NHPA nor its legislative history, clarified the meaning of "substantially prevails," the court relied on interpretations of similar attorneys' fees provisions in other Federal statutes. When a case is not decided on its merits, courts apply a two-part test in deciding the award of attorneys' fees and costs: "First, the party must have substantially received the relief sought, and, second, the lawsuit must have been a catalytic, necessary, or substantial factor in attaining the relief." Should the court determine that the test is satisfied, it must decide, in its discretion, whether an award of attorneys' fees and costs will further the purpose of the statute.

Applying the test to the facts of this case, the district court found that the award of attorneys' fees and costs was appropriate. Plaintiffs contended that they substantially received the relief they sought when the District of Columbia withdrew its application for a demolition permit and modified its contract with the developer by conditioning the District's obligations upon completion of the Section 106 review process. Defendants agreed that plaintiffs substantially prevailed but contended that the litigation was not a substantial factor in obtaining their relief.

Specifically, defendants claimed that the application for a demolition permit would have been withdrawn without the lawsuit and was filed merely to expedite the proceedings of the District of Columbia Joint Committee on Landmarks. The court examined the sequence of events leading up to the withdrawal of the demolition permit application and found defendants' argument unsupported by the record. With regard to the contractual modifications, the court rejected the argument that the contractual amendments had been previously agreed to orally and were not a result of the lawsuit, because they could find no evidence in the record to support defendants' contention. Defendants conceded that the amount sought for attorneys' fees and costs was reasonable. Upon finding the award would further the purpose of encouraging NHPA compliance, the court awarded fees and costs to plaintiffs.