Guglielmo v. Nebraska Furniture Mart, Inc.

Background

Joseph Guglielmo, who is visually impaired and legally blind, sued Nebraska Furniture Mart, Inc. He alleged that the company’s website lacked features and accommodations needed by blind and visually impaired consumers, denying them equal access to the website in violation of Title III of the Americans with Disabilities Act (ADA) and the New York City Human Rights Law.

In an earlier order, the court dismissed the complaint without prejudice under Federal Rule of Civil Procedure 12(b)(1), for lack of subject-matter jurisdiction, and Rule 12(b)(2), for lack of personal jurisdiction. The earlier dismissal cited deficiencies involving standing, mootness, and personal jurisdiction. Nebraska Furniture Mart then moved for attorney’s fees under the ADA’s fee provision, 42 U.S.C. § 12205.

Legal standard

The ADA permits a court, in its discretion, to award reasonable attorney’s fees and litigation expenses to a prevailing party. A defendant seeking fees must first qualify as a prevailing party by obtaining a material, court-approved change in the parties’ legal relationship. A prevailing defendant may recover fees only if the plaintiff’s claim was frivolous, unreasonable, or groundless, or if the plaintiff continued litigating after the claim clearly became so. The court emphasized that a plaintiff’s failure to win the case does not by itself justify awarding fees to the defendant, and that courts should not use hindsight to label a claim frivolous.

Prevailing-party determination

The court held that Nebraska Furniture Mart was a prevailing party. It reasoned that the court’s ruling concerning mootness was binding on the parties and affected their rights; otherwise, the ruling would have been an improper advisory opinion. The court also explained that the fact that the earlier dismissal was without prejudice did not prevent Nebraska Furniture Mart from being a prevailing party. The dismissal was not based on the merits, but a defendant can prevail when a final judgment rejects the plaintiff’s claim for a non-merits reason.

The court further reasoned that Guglielmo could not cure through amendment the deficiencies underlying the dismissal. Even if he could replead and establish standing, the court stated that he would likely still face the mootness and personal-jurisdiction problems identified in the earlier order.

Whether fees were justified

The court nevertheless found that Nebraska Furniture Mart had not shown that Guglielmo’s claims were frivolous, unreasonable, or groundless. Although the allegations were lacking in detail and did not establish standing, they were not completely without factual or legal support. Guglielmo alleged that he had a disability and that the website denied him a full and equal opportunity to use it. The court also noted evidence concerning website defects and Nebraska Furniture Mart’s remediation efforts.

The court found that the website contained conflicting information about the company’s delivery policy. That conflict gave Guglielmo a reasonable basis, when he filed the complaint, to believe that he could make a purchase in New York and establish personal jurisdiction. The court also declined to treat the claims as frivolous merely because it later found the allegations insufficient to establish a concrete and particularized injury.

The court rejected Nebraska Furniture Mart’s argument that Guglielmo acted unreasonably by continuing to litigate. Guglielmo’s arguments about whether the company’s answer made its motion to dismiss moot were not frivolous, particularly because the court itself ordered briefing on that issue and the relevant precedent was limited. The court also found it reasonable for Guglielmo not to assume that the company’s website remediation automatically made the claims moot, because a defendant must meet a demanding standard to show that the challenged conduct could not reasonably be expected to recur.

Disposition

The court denied Nebraska Furniture Mart, Inc.’s request for attorney’s fees and directed the clerk to terminate the motion at docket entry 39. The court did not award fees even though it found that Nebraska Furniture Mart was a prevailing party.