Centex Corp. v. CTX Holding Co., 2007 U.S. App. LEXIS 11537 (May 17)
Plaintiffs successfully sued the government for enacting legislation (retroactively eliminating certain tax benefits) that resulted in a breach of the government’s contract with plaintiffs. Plaintiffs then sought attorney’s fees based on the government’s bad faith in enacting the legislation. However, because the alleged bad faith involved conduct preceding the litigation, the Federal Circuit found a fee award inappropriate. The Court cited eight other circuits that have taken the same position, as well as Supreme Court decisions suggesting that abuse of the judicial process refers to misconduct during litigation rather than preceding it.
