CHURCH OF SCIENTOLOGY FLAG SERVICES ORG., INC., Plaintiff,
CITY OF CLEARWATER, et al., Defendants.
United States District Court,
July 2, 1991.
Following a federal district court determination that municipal ordinance
regulating charitable solicitation within corporate boundaries was
constitutional, charitable group which had opposed ordinance sought attorney
fees under civil rights statute. The District Court, Kovachevich, J., held
that: (1) organization was not entitled to legal fees on grounds that district
court had issued injunction against first ordinance, which was subsequently
vacated by Court of Appeals; (2) legal fees were not available on grounds that
rescission of first ordinance constituted a vindication of the organization's
right and cessation of the municipality's challenged behavior; and (3) fees
were not available on grounds that there had been material alteration of
parties' legal relationships.
Attorney fees claim denied.
 CIVIL RIGHTS
When a plaintiff wins a preliminary injunction against enforcement of an
ordinance's provisions, and ordinance is later repealed, plaintiff is a
"prevailing party" for purposes of statute awarding attorney fees in civil
rights cases. 42 U.S.C.A. s 1988.
See publication Words and Phrases for other judicial constructions and
 CIVIL RIGHTS
When ordinance has been repealed prior to court's issuance of preliminary
injunction, controversy is moot and party seeking injunction is not "prevailing
party" for purposes of statute awarding attorney fees in civil rights cases.
42 U.S.C.A. s 1988.
 CIVIL RIGHTS
Temporary court order granted in violation of law and reversed on appeal does
not support finding that plaintiff is a "prevailing party" for purposes of
statute awarding attorney fees in civil rights cases. 42 U.S.C.A. s 1988.
 CIVIL RIGHTS
Even if plaintiff seeking to be qualified as "prevailing party" for purposes of
obtaining attorney fees under civil rights statute can demonstrate clear causal
link between lawsuit and defendant's resulting conduct, plaintiff does not
prevail if plaintiff does not benefit from conduct. 42 U.S.C.A. s 1988.
 CIVIL RIGHTS
Charity opposing municipal ordinance regulating charitable solicitations within
community was not "prevailing party" for purposes of obtaining attorney fees
under civil rights statute, based upon district court declaring an ordinance
which had already been repealed by county unconstitutional and issuing
preliminary injunction enjoining its enforcement; injunction was later vacated
on appeal. 42 U.S.C.A. s 1988.
 CIVIL RIGHTS
Charity was not "prevailing party" for purposes of obtaining attorney fees
under civil rights statute, based upon claim that municipality had rescinded
ordinance restricting charitable solicitations after lawsuit was filed;
municipality subsequently enacted another regulatory ordinance embodying most
of the objections charity had found to first ordinance. 42 U.S.C.A. s 1988.
 CIVIL RIGHTS
Charitable organization was not entitled to attorney fees under civil rights
statute for having obtained a favorable result in litigation, through
accomplishing material alteration of legal relationships with party it sued,
even though charity claimed that its lawsuit prompted a municipality to rescind
ordinance regulating charitable solicitations within its borders and adopt
second ordinance with terms more favorable to charity as to solicitation of its
own members and as to county attorney's powers to issue subpoenas for
information regarding solicitation; in its opposition to second ordinance,
charitable organization made same types of complaints it had against first
ordinance. 42 U.S.C.A. s 1988.
*322 Eric M. Lieberman, Katherine Stone, Rabinowitz, Boudin, Standard,
Krinsky & Lieberman, P.C., New York City, Paul B. Johnson, Johnson, Paniello &
Hayes, Tampa, Fla., for plaintiff.
Frank Kowalski, Chief Asst. City Atty., Dennis L. Repka, Sargent, Repka,
Covert, Steen & Zimmet, P.A., Clearwater, Fla., for defendants.
ORDER ON MOTIONS
KOVACHEVICH, District Judge.
This cause is before the Court on the following:
Dkt. 106 Order to show cause before 7/21/87 why this case should not be
dismissed for lack of prosecution.
Dkt. 107 Response to the Court's order to show cause why this case should not
be dismissed for failure to prosecute by Plaintiff.
Dkt. 108 Motion for attorneys' fees and costs by Plaintiff, filed October 19,
Dkt. 109 Memorandum of law in support of Plaintiff's motion for attorneys'
fees and costs filed October 19, 1987.
Dkt. 110 Affidavit in support of Plaintiff's motion for attorneys' fees with
Exhibits A-P attached by Eric M. Lieberman, filed October 19, 1987.
Dkt. 113 Memorandum in response to Plaintiff's application for attorneys'
fees and costs by Defendants with Exhibits *323 filed under separate cover,
filed November 19, 1987.
Dkt. 117 Reply memorandum in support of Plaintiff's application for
attorneys' fees and costs by Johnson & Hayes, counsel for Plaintiff, filed
December 16, 1987.
Dkt. 118 Supplemental memorandum of law in support of Plaintiff's application
for attorneys' fees and costs by Plaintiff, filed July 14, 1989.
Dkt. 124 Defendants' reply to Plaintiff's supplemental memorandum seeking
attorneys' fees for proceedings relating to Clearwater's initial ordinance,
filed May 2, 1991.
1. On October 6, 1983, Defendant City of Clearwater (Clearwater) enacted
Ordinance No. 3091-83, to become effective January 31, 1984. The purpose of
the ordinance was to regulate charitable solicitations within the city. The
ordinance required charitable organizations that wanted to solicit funds in
Clearwater to register with the city, maintain specified records, disclose the
sources and uses of their contributions, refrain from engaging in fraudulent
solicitation practices and submit to an investigation by the City Attorney if
ten or more individuals complained about the organization's activities.
Clearwater patterned the ordinance after a similar Houston ordinance, upheld as
constitutional by the Fifth Circuit Court of Appeals. See International
Society of Krishna Consciousness of Houston, Inc. [ISKCON] v. City of Houston,
689 F.2d 541 (5th Cir.1982).
2. On January 20, 1984, Americans United for Separation of Church and State
(Americans United) brought a ten-count action in the Federal District Court of
the Middle District of Florida (the Court) to enjoin Clearwater from enforcing
the ordinance. Each count raised a discrete constitutional claim.
3. On January 23, Plaintiff Church of Scientology Flag Services Organization,
Inc. (Scientology) brought a separate twelve-count action for injunctive relief
on similar constitutional grounds. Both Plaintiffs moved for temporary
restraining orders pursuant to Rule 65(b), Federal Rules of Civil
Procedure. Scientology's case number was 84-96-Civ-T-17 (hereinafter 84-96).
The Court, pursuant to Rule 65(a)(2), Federal Rules of Civil Procedures,
consolidated the parties' motions for injunctive relief with the trial on the
merits, and scheduled a hearing on the issue of a permanent injunction. At the
hearing, the parties requested the Court to limit the scope of the hearing to
the facial validity of the ordinance. Clearwater stated that it would not
challenge Scientology's standing, except as to the claims alleging that the
ordinance violated the freedom of religion clauses of the first amendment.
After argument on the facial validity of the ordinance, the Court directed
counsel to file post-hearing Memoranda by March 16.
4. On March 15, Clearwater enacted Emergency Ordinance No. 3479-84, as
an amendment to Ordinance No. 3091-83. Like Ordinance No. 3091-83, the amended
ordinance comprehensively regulated charitable solicitation and effectively
repealed Ordinance No. 3091-83. As an emergency ordinance, No. 3479-84
would automatically expire after 90 days if not passed as a non-emergency
ordinance within that time. In addition, Ordinance No. 3479-84 explicitly
provided for its expiration in 90 days. Clearwater notified the Court and
Plaintiffs of the amended ordinance.
5. On March 28, the Court determined that repealed Ordinance No. 3091-83 was
unconstitutional and permanently enjoined its application and enforcement. The
Court did not specify which of the several counts of the Plaintiffs' complaints
it was deciding. The Court terminated the Americans United case and dismissed
all but one count of Scientology's complaint in 84-96, retaining jurisdiction
for the enforcement of the executory provisions of its order.
6. On April 5, Clearwater appealed the District Court's injunctive orders as
to Ordinance No. 3091-83, pursuant to 28 U.S.C. s 1292(a)(1) (1982).
Section 1292 provides that Courts of Appeals have jurisdiction *324 over
appeals from interlocutory orders of the District Court's granting or refusing
to grant injunctions.
7. On April 20, Scientology, seeking to enjoin the enforcement of Emergency
Ordinance No. 3479-84, moved the District Court for leave to amend the
remaining count of its 84-96 complaint. The proposed amendment set out the
same constitutional challenges that Scientology had raised in opposition to the
original ordinance. At the same time, Scientology moved the Court for a
temporary restraining order prohibiting Clearwater from enforcing Ordinance No.
8. On May 17, Clearwater enacted Ordinance No. 3479-84 as a permanent
9. On May 21, Americans United filed a new action in the District Court
seeking injunctive relief and challenging the constitutionality of Ordinance
No. 3479-84 on the grounds raised in its previous suit. Simultaneously,
Americans United moved for a temporary restraining order, which the Court
10. On May 24, Scientology filed a new suit, seeking essentially the same
relief as Americans United. The Case was given the number 84-719-Civ-T-17
(hereinafter 84-719). Scientology's action asked for declaratory and
injunctive relief. Scientology contended that:
A) The amended ordinance was enacted to single out Scientology for harassment
and persecution in violation of the establishment and free exercise clauses of
the first amendment and the equal protection and due process clauses of the
B) On its face and as applied to all religious groups, the amended ordinance
violates the first, fourth, fifth and ninth amendments of the United States
Constitution; sections 2, 3, 4, 5, 9, 17, and 23 of
Article I of the Florida Constitution; Florida Statutes s 166.04(a); and
Clearwater City Charter s 2.09. Scientology alleges that the case arises
under 42 U.S.C. ss 1983 and 1988, and 28 U.S.C. ss 2201 and 2202.
11. At this point, Scientology had two identical suits pending, 84-719
and 84-96. The two Scientology cases and the American United case challenging
amended Ordinance No. 3479-84 were not consolidated by the District Court.
12. On July 13, the District Court heard argument of Americans United and
Scientology counsel at a scheduled hearing limited to the question of the
facial constitutionality of Ordinance No. 3479-84 in the abstract. The Court
did not consider the merits of any of the pending motions or receive any
evidence. The Court found that Ordinance No. 3479-84 was facially
constitutional. However, the Court encouraged an immediate interlocutory
appeal to the Eleventh Circuit Court of Appeals, pursuant to 28 U.S.C. s
1292(b) (1982). The Court also issued a temporary restraining order enjoining
Clearwater from enforcing the ordinance pending the disposition of any appeals
that might be taken. In its written orders, the Court converted its temporary
restraining orders to preliminary injunctions prohibiting Clearwater from
enforcing the portions of Ordinance No. 3479-84 that dealt with a charitable
organization's obligation to register with the city and to maintain certain
13. On July 31, Scientology moved the District Court, in both of its cases,
84-719 and 84-96, for temporary restraining orders prohibiting Clearwater from
enforcing all provisions of the Ordinance No. 3479-84. Scientology also moved
the Court to schedule an evidentiary hearing on its pending application for a
14. On August 2, the Court denied Scientology's motion for a temporary
restraining order prohibiting Clearwater from enforcing Ordinance No. 3479-84
and denied Scientology's motion for a hearing on its application for a
15. On August 3, Scientology appealed the District Court's July 23 orders
declaring Ordinance 3479-84 constitutional and enjoining the enforcement of
less than all of Ordinance No. 3479-84. Scientology also appealed the District
Court's August 2 *325 order denying Scientology's motion for a temporary
restraining order and a preliminary injunction.
16. On November 1, the Eleventh Circuit Court of Appeals
A) vacated the District Court's order prohibiting Clearwater from enforcing
repealed Ordinance No. 3091-83 because the controversy was moot; the Eleventh
Circuit remanded the two cases with instructions that they be dismissed without
B) dismissed the section 1292(b) interlocutory appeals from the District
Court's determination that amended Ordinance No. 3479-84 was facially
constitutional; the Eleventh Circuit vacated the orders that allowed the
appeals to proceed;
C) affirmed the District Court's refusal to grant Scientology's applications
for preliminary injunctions because Scientology failed to establish the
criteria necessary for preliminary injunctive relief. The Eleventh Circuit
also found that the District Court record did not support an adequate basis to
justify a finding of standing.
17. On July 7, 1987, the Court issued an order to show cause before July
21, 1987 why 84-96 should not be dismissed for lack of prosecution.
18. On July 23, Scientology, in 84-719, filed a motion for partial summary
judgment on the issue of standing, and on January 15, 1988, in the same case,
filed a partial summary judgment on standing and the merits.
19. On October 19, Scientology filed a motion for attorneys' fees and costs in
84-96. Clearwater filed memoranda in opposition to the award of attorneys'
fees and costs.
20. On January 15, 1988, Clearwater filed a motion for summary judgment in 84-
21. On February 4, 1991, the Court granted Scientology's motion for partial
summary judgment against Clearwater on the issue of standing in 84-719, and
granted Clearwater's motion for partial summary judgment against Scientology on
all issues other than standing in 84-719. 756 F.Supp. 1498. The Court held
that all sections of Ordinance No. 3479-84 are constitutional. A summary of
Ordinance No. 3479-84 appears in Appendix A.
The Court dismisses this case, with prejudice, and denies Plaintiff's motion
for attorneys' fees and costs under 42 U.S.C. s 1988. Title 42 U.S.C. s
1988 provides that in federal civil rights actions "the court, in its
discretion, may allow the prevailing party, other than the United States, a
reasonable attorney's fee as part of the costs." The question here is whether
Scientology is a prevailing party. The Court finds that Scientology is not a
prevailing party for the following reasons: 1) the lawsuit did not result in
the vindication of Scientology's rights; 2) the lawsuit did not result in the
cessation of Clearwater's challenged behavior; and, 3) the lawsuit did not
cause a material alteration in the legal relationship of the parties. Because
the Court determined that Scientology is not a prevailing party, the Court did
not consider whether special circumstances would prevent the award of
attorneys' fees, or whether the requested fees were excessive. The Court's
reasoning is set out below.
This case was administratively closed July 23, 1984, pending completion of
interlocutory appeals. The Eleventh Circuit Court of Appeals dismissed those
interlocutory appeals on November 13, 1985. No further action was taken in the
case until the District Court entered its order to show cause why the case
should not be dismissed for failure to prosecute on July 7, 1987.
Scientology litigated its identical claims in 84-719 and the Court granted
summary judgment in favor of Clearwater. Scientology is now appealing that
decision. Dismissing this case will not foreclose or adversely affect
Scientology's litigation of its claims in 84-719. Dismissing the case will
promote judicial economy, however. Therefore, the Court dismisses this case,
*326 II. ATTORNEYS' FEES
A. Attorneys' Fees Under 42 U.S.C. s 1988
Title 42 U.S.C. s 1988 provides that in federal civil rights actions, "the
court, in its discretion, may allow the prevailing party, other than the United
States, a reasonable attorney's fee as part of the costs." The purpose of
s 1988 is to ensure "effective access to the judicial process" for persons
with civil rights grievances. H.R.Rep. No. 94-1558, p. 1 (1976). A prevailing
plaintiff " 'should ordinarily recover an attorney's fee unless special
circumstances would render such an award unjust.' " S.Rep. No. 94-1011, p. 4
(1976) (quoting Newman v. Piggie Park Enterprises, Inc., 390 U.S. 400, 402,
88 S.Ct. 964, 966, 19 L.Ed.2d 1263 (1968)). The fee amount must be determined
on the facts of each case. See Johnson v. Georgia Highway Express, Inc.,
488 F.2d 714 (5th Cir.1974) (twelve factors for determining fee amount).
Johnson indicates that the level of a plaintiff's success is relevant to the
amount of fees awarded.
A plaintiff must be a "prevailing party" to recover under s 1988.
The standard requires that parties succeed on "any significant issue in the
litigation which achieves some of the benefit they sought in bringing the
suit." Nadeau v. Helgemoe, 581 F.2d 275, 278-79 (1st Cir.1978), quoted in
Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 1939, 76 L.Ed.2d
40 (1983). "Under that standard, at a minimum, the plaintiff must be able to
point to a resolution of the dispute which materially alters the parties' legal
relationship in a manner which Congress sought to promote in the fee
statute." Texas State Teachers Association, et al. v. Garland Independent
School District, et al., 489 U.S. 782, 783, 109 S.Ct. 1486, 1488, 103 L.Ed.2d
866 (1989) (citing Hewitt v. Helms, 482 U.S. 755, 760-61, 107 S.Ct. 2672,
2675-76, 96 L.Ed.2d 654 (1987)). A plaintiff must "receive at least some
relief on the merits of his claim before he can be said to prevail."
Hewitt, 482 U.S. at 760, 107 S.Ct. at 2675.
Where the plaintiff's success on a legal claim can be characterized as purely
technical or de minimis, a district court would be justified in concluding that
even the 'generous formulation' we adopt today has not been satisfied ... The
touchstone of the prevailing party inquiry must be the material alteration of
the legal relationship of the parties in a manner which Congress sought to
promote in the fee statute. Where such a change has occurred, the degree of
the plaintiff's overall success goes to the reasonableness of the award under
Hensley, not to the availability of a fee award vel non (citations omitted).
Texas State Teachers, 489 U.S. at 792-93, 109 S.Ct. at 1493. One of
Congress' goals in enacting s 1988 was to encourage individuals to assume
the role of "private attorney general." Id. at 793, 109 S.Ct. at 1494.
 When a plaintiff wins a preliminary injunction against enforcement
of an ordinance's provisions, and the ordinance is later repealed, a plaintiff
is a prevailing party. Taylor v. Fort Lauderdale, 810 F.2d 1551 (11th
Cir.1987). However, when an ordinance has been repealed prior to the Court's
issuance of a preliminary injunction, the controversy is moot. Church of
Scientology Flag Service Organization v. City of Clearwater, 777 F.2d 598, 605,
608 (11th Cir.1985). A temporary court order granted in violation of law and
reversed on appeal does not make a plaintiff a prevailing party. A plaintiff
cannot be a prevailing party if plaintiff has no right to the relief
obtained. Doe v. Busbee, 684 F.2d 1375, 1380 (11th Cir.1982).
"This Circuit permits the award of attorney's fees to a 'prevailing party' if
the litigation 'successfully terminates by a consent decree, an out-of-court
settlement, a voluntary cessation of the unlawful practice by defendant, or
other mooting of the case where the plaintiff has vindicated his right.' "
Taylor v. City of Fort Lauderdale, 810 F.2d at 1560 (citing Doe v.
Busbee, 684 F.2d at 1379). "Analysis hinges upon whether 'the lawsuit is a
substantial factor or a significant catalyst in motivating defendants to end
their unconstitutional behavior.' " Taylor v. City of Fort Lauderdale, 810
F.2d at 1560 (citing Doe *327 v. Busbee, 684 F.2d at 1380). "A party can
achieve 'prevailing party' status by establishing a 'clear causal relationship
between the litigation brought and the practical outcome realized.' " Ward
v. County of San Diego, 791 F.2d 1329, 1334 (9th Cir.1986) (citing
Rutherford v. Pitchess, 713 F.2d 1416, 1419 (9th Cir.1983)). See also,
Robinson v. Kimbrough, 652 F.2d 458, 466 (5th Cir.1981), withdrawing and
vacating 620 F.2d 468 (5th Cir.1980) (catalyst exists where lawsuit was "a
substantial factor or a significant catalyst in motivating the defendants to
end their [challenged] behavior.")
 Even if a Plaintiff can demonstrate a clear causal link between a
lawsuit and a Defendant's resulting conduct, a Plaintiff does not prevail if
Plaintiff does not benefit from the conduct. Hewitt v. Helms, 482 U.S. at
760, 107 S.Ct. at 2675. See also, Casines v. Murchek, 766 F.2d 1494, 1503
(11th Cir.1985) (consistent with the policy underlying section 1988,
Plaintiff must in some way vindicate a civil right at issue in the litigation
against the violator of that civil right in order to be considered a prevailing
III. THE PARTIES' CONTENTIONS
 Scientology contends that it is entitled to attorneys' fees because the
District Court declared repealed Ordinance No. 3091-83 unconstitutional and
issued a preliminary injunction enjoining its enforcement. Scientology claims
that Taylor v. Fort Lauderdale, 810 F.2d 1551 mandates that attorneys' fees
be awarded in the present case. In Taylor, Fort Lauderdale adopted a
charitable solicitation ordinance regulating indoor and outdoor solicitation.
A minority religious group alleged that the ordinance was unconstitutional on
its face and as applied. Plaintiffs won a preliminary injunction against
enforcement of the ordinance's provisions.
The Taylor Court then granted Plaintiff's motion for summary judgment with
respect to the part of the ordinance dealing with indoor solicitation,
intimating that there was no discriminatory application of the outdoor
solicitation requirements. The Taylor Court did not rule on the latter
issue, however. Defendant Fort Lauderdale subsequently repealed the ordinance
and enacted a new ordinance. Plaintiffs did not challenge the amended
The Taylor Court denied Plaintiff's subsequent application for attorneys'
fees, but on appeal, the Eleventh Circuit Court of Appeals reversed. The
appellate Court stated that Plaintiff's success on the preliminary injunction
made it a prevailing party entitled to attorneys' fees and that the subsequent
mooting of the case by the recision of the ordinance did not vitiate that
success. Scientology compares the facts in Taylor to those in the present
case and concludes that they are similar. Therefore, Scientology argues,
attorneys' fees should be awarded in the present case.
Clearwater argues that Scientology could not be the prevailing party because
the order Scientology relied on to claim prevailing party status was vacated by
the Eleventh Circuit. Clearwater points out that the Eleventh Circuit held
that the preliminary injunction should not have been entered because the case
was moot at the time of entry and Scientology had not submitted facts
establishing standing to challenge the ordinance. Defendants' Memorandum in
Response to Plaintiff's Application for Attorney's Fees and Costs [hereinafter
Defendants' Response Memo], pp. 3-4.
Clearwater cites Doe v. Busbee, 684 F.2d 1375, and argues that a temporary
District Court victory that is granted in violation of law and is reversed on
appeal does not make the plaintiff a prevailing party. Clearwater points out
that, in Doe v. Busbee, the plaintiff obtained preliminary and permanent
injunctive and declaratory relief in the District Court. While the District
Court's orders were on appeal, the Supreme Court issued two decisions that
undercut the lower Court's opinion. On remand, the District Court vacated its
final judgment and dismissed the Plaintiff's complaint. However, the District
Court refused to vacate its prior award of attorneys' fees, stating the
Plaintiffs had obtained *328 substantial relief while the injunctions were
The Eleventh Circuit reversed. After studying the purposes of
s 1988, the Circuit Court held that the Plaintiffs were not prevailing
parties because "Their successes were merely temporary, and any benefit flowing
from their successes in the District Court was awarded under a mistake of
law." Id. at 1380. Having had no right to the relief obtained, the
Plaintiffs were not prevailing parties. Id. at 1382.
Clearwater also cites a Ninth Circuit decision, Ward v. County of San
Diego, 791 F.2d 1329, in which the Circuit Court affirmed a denial of a request
for attorneys' fees. The Ninth Circuit held that the Plaintiff's
lack of standing in her original challenge rendered illusory the practical
outcome she temporarily received (the preliminary injunction) ... An
erroneously granted injunction cannot be the basis for an award of attorney
fees as the prevailing party.
Id. at 1334.
The Court rejects Scientology's claim that Taylor v. Fort Lauderdale
mandates an award of attorneys' fees in this case. The Court distinguishes
Taylor on the facts. In Taylor, the ordinance was in effect when the
District Court granted a preliminary injunction. In the present case,
Ordinance No. 3091-83 was not in effect when the District Court declared the
ordinance unconstitutional and granted the injunction. Church of
Scientology Flag Service Organization, Inc. v. City of Clearwater, 777 F.2d at
601. As the Eleventh Circuit Court of Appeals pointed out, "Ordinance No.
3091-83 was no longer in force when the District Court declared it
unconstitutional. 'Where by ... a subsequent law, the existing controversy has
come to an end, the case becomes moot and should be treated accordingly.' "
Id. at 605.
The Court also distinguishes Taylor by the number of complaints the
Plaintiff filed. Plaintiff Taylor filed only one complaint against the
original ordinance. Taylor neither continued his original suit against the
amended ordinance, nor did he file a new complaint against the amended
ordinance. Scientology did both. Scientology, unlike Taylor, amended its
original complaint and continued its original suit against the amended
ordinance and in addition, filed a new suit alleging identical claims of
unconstitutionality against the amended ordinance. Because the facts in
Taylor differ from the facts in the present case, the Court finds that
Taylor does not mandate the award of attorneys' fees.
Vindication of Scientology's Rights and Cessation of Clearwater's Challenged
 Next, Scientology claims prevailing party status because Clearwater
conceded the unconstitutionality of Ordinance No. 3091-83 and adopted amended
Ordinance No. 3479-84 in response to Scientology's arguments. Memorandum in
Support of Plaintiff's Application for Attorney's Fees and Costs, [hereinafter
Plaintiff's Support Memo] pp. 1, 5, 6. Scientology argues that "A judgment is
not a prerequisite for a fee award, and a party prevails where there is
voluntary cessation of the unlawful practice by the defendant, or other mooting
of the case where the plaintiff has vindicated his right." Doe v. Busbee,
684 F.2d at 1379. Scientology argues that Clearwater amended the original
Ordinance No. 3091-83 in direct response to its lawsuit and claims that "Where
a lawsuit has been the catalyst to obtain voluntary relief against a defendant,
fees must be awarded." Plaintiff's Support Memo, p. 10 Scientology cites
Maher v. Gagne, 448 U.S. 122, 100 S.Ct. 2570, 65 L.Ed.2d 653 (1980);
Martin v. Heckler, 773 F.2d 1145 (11th Cir.1985); Doe v. Busbee, 684
F.2d 1375; Iranian Students Association v. Sawyer, 639 F.2d 1160 (11th
Cir.1981); Dayan v. Board of Regents, 620 F.2d 107 (5th Cir.1980).
The Court rejects Scientology's claim that attorneys' fees should be
awarded because Scientology's lawsuit was a catalyst in the District Court's
declaring Ordinance No. 3091-83 unconstitutional. Regardless of the role
Scientology played in the Court's decision, if the decision did not
*329 vindicate Scientology's rights, and motivate Clearwater to end its
challenged behavior, Scientology is not entitled to attorneys' fees. Taylor
v. City of Fort Lauderdale, 810 F.2d at 1560 (citing Doe v. Busbee, 684 F.2d
at 1375, 1379, 1380). See also Hewitt v. Helms, 482 U.S. 755, 107 S.Ct.
2672, 96 L.Ed.2d 654; Casines v. Murchek, 766 F.2d 1494.
The Court finds that Scientology's rights were not vindicated as a result of
its lawsuit against Ordinance No. 3091-83. The evidence for this finding is
the fact that Scientology filed suit against amended Ordinance No. 3479-84
alleging claims almost identical to those it alleged against Ordinance No.
3091-83. Further evidence of this finding is the fact that the parties' legal
relationship was not materially altered by the lawsuit. (See section below on
the "No Material Alteration of the Legal Relationships of the Parties.")
In addition, Clearwater did not end its challenged behavior as a result of
Scientology's lawsuit against Ordinance No. 3091-83. Clearwater adopted
Ordinance No. 3479-84 immediately. In a Prehearing Memorandum, Scientology
argued, "that in dispositive respects the new ordinance was the same as or even
worse than the old one: 'While the new ordinance differs in some respects from
its predecessor, what is significant are the ways in which the new ordinance is
similar or identical to the very aspect of the old Ordinance which caused this
Court to rule it unconstitutional.' " Defendants' Response Memo, p. 9.
In the Eleventh Circuit, Scientology told the Court that the amendments did
not "truly remove[e] the constitutional infirmities" of the initial ordinance.
And in a July 21, 1987 brief to this Court urging that its first case not be
dismissed, Scientology said the claims it raised in its second complaint are
"identical to those raised in its first. Defendants' Response Memo, p. 10,
citing Response of Plaintiff Church to the Court's Order To Show Cause, p. 7.
The Court finds that Scientology's argument that it is a prevailing party
because its lawsuit was a catalyst in the District Court's action declaring
Ordinance No. 3091-83 unconstitutional is not persuasive because Scientology
did not vindicate its rights by the lawsuit, nor did Clearwater discontinue the
No Material Alteration of the Parties' Legal Relationship
 Scientology claims that it is a prevailing party because it prevailed on
significant issues in the litigation that achieved some benefit it sought in
bringing the suit. Scientology points out that, after Texas State Teachers,
prevailing parties no longer have to prevail on the central issue of a case to
receive attorneys' fees, but only on "any significant issue in the litigation
which achieves some of the benefit they sought in bringing the suit."
Nadeau v. Helgemoe, 581 F.2d at 278-79, quoted in Hensley v. Eckerhart,
461 U.S. at 433, 103 S.Ct. at 1939. "Under that standard, at a minimum, the
plaintiff must be able to point to a resolution of the dispute which materially
alters the parties' legal relationship in a manner which Congress sought to
promote in the fee statute." Texas State Teachers Association, et al. v.
Garland Independent School District, et al., 489 U.S. at 783, 109 S.Ct. at
1488 (citing Hewitt v. Helms, 482 U.S. at 760-61, 107 S.Ct. at 2675-76).
In Texas State Teachers, Petitioner teachers and teacher
organizations sued the school district for the district's regulations
prohibiting employee organizations access to school facilities during school
hours, prohibiting teachers from communicating among themselves about employee
organizations during school hours, prohibiting the use of school mail and
internal communications systems by employee organizations, and requiring the
district's permission for on-premises, after hours meetings between teachers
and employee organizations. On cross-motions for summary judgment the District
Court rejected all of Plaintiff's claims except the last one.
On appeal, the Fifth Circuit agreed with the District Court that the
prohibition on employee organizations' access to school premises during school
hours was not unconstitutional, and affirmed the grant of *330 summary
judgment to the school district on this claim. Texas State Teachers
Association v. Garland Independent School District, 777 F.2d 1046 (5th
Cir.1985). But the Fifth Circuit found for the teachers on the issues of
teacher-to-teacher discussion of employee organizations and the use of internal
mail and bulletin boards for such communication. The Supreme Court summarily
affirmed. Texas State Teachers, 479 U.S. 801, 107 S.Ct. 41, 93 L.Ed.2d 4.
The teachers then filed an application for attorneys' fees. The District
Court recognized that the teachers had achieved partial success, but concluded
that they were not prevailing parties under the central issue/primary relief
test in use in the Fifth and Eleventh Circuits. The District Court denied
attorneys' fees and the Fifth Circuit affirmed. Texas State Teachers
Association v. Garland Independent School District, 837 F.2d 190 (5th
Cir.1988). However, the Supreme Court rejected the central issue/prevailing
party threshold test for attorneys' fees' eligibility. Instead, the Court
ruled that the threshold test was whether the lawsuit led to "the material
alteration of the legal relationship of the parties in a manner which Congress
sought to promote in the fee statute." Texas State Teachers, 489 U.S. at
792, 109 S.Ct. at 1493.
Scientology claims that it prevailed on two significant issues that materially
altered the parties' legal relationship. The first issue was the elimination
of the definition of "member" from Ordinance No. 3479-84. The definition,
found at Section 100.01(5) of Ordinance No. 3091-83 read, "The term, 'member'
shall mean any person regularly attending or participating in a charitable
organization." Scientology claims that the definition of member in the
original ordinance meant that the ordinance discriminated between Scientology
and religions that were more established. Plaintiff's Supplemental Memo, p. 2.
The second issue was the change in the manner in which city officials
determined the propriety of investigating complaints against a charitable
organization between Ordinance No. 3091-83 and 3479-84. Scientology claimed
that Provision 100.06 in Ordinance No. 3091-83 gave officials "unbridled
discretion," to investigate a religion's charitable solicitation practices.
Plaintiff's Supplemental Memo, p. 6.
Section 100.06 is set out below. The lined-out portions appeared in
Ordinance No. 3091-83. The underlined portions were added in Ordinance No.
Section 100.06. Power of the City Attorney to Investigate and Prosecute
Prohibited Acts of Charitable Organizations.
1. The City Attorney shall investigate alleged violations of this chapter
only after ten individuals file separate bona fide complaints in writing, sworn
to or affirmed, with the City Attorney, setting forth facts demonstrating that
one or more of the prohibited acts set forth in Section 100.05 have been
engaged in by the charitable organization and that the complaining party has
been injured by each act or acts.
2. The City Attorney, when conducting an investigation pursuant to
subparagraph 1 shall have the power to subpoena any person, require the
production of the records or documents described in Section 100.04 and the
private statement and records or documents described in *331 Section
100.01(3), and administer oaths.
3. If the investigation conducted under subparagraph 1 demonstrates that
probable cause exists to believe that a violation or violations under Section
100.05 exist, then the City Attorney shall institute an action to prosecute
such violation or violations.
Clearwater argues that the eliminations and alterations cited by Scientology
made Scientology's position worse than it was before the changes were made.
Clearwater explains that the deletion of the definition of "member" meant that
Ordinance No. 3479-84 applied to Scientology's solicitation from its own
members. Clearwater points out that Ordinance No. 3091-83, containing the
definition, had not applied to organizations' solicitation from their own
Clearwater points to the fact that now, after the definition of "member" was
eliminated, Scientology claims that Ordinance No. 3479-84 is unconstitutionally
overbroad and violates Plaintiff's first amendment rights because the ordinance
regulates fundraising by churches from their own members and on their own
premises. Clearwater argues that Scientology could not have prevailed on the
membership issue because Scientology continues to allege that the membership
provision is unconstitutional.
Further, Clearwater claims that Scientology is in a worse position
after the changes regarding the City Attorney's power to issue subpoenas.
Clearwater explains that Ordinance No. 3091-83 required the City Attorney to
apply to a court for authority to issue subpoenas for documents; however,
Ordinance No. 3479-84 contains no such requirement. The City Attorney can
issue subpoenas without applying to the Court. In addition, Clearwater states,
the City Attorney is required to investigate if he receives ten bona fide
complaints about a group under Ordinance No. 3479-84. Under Ordinance No.
3091-83, the City Attorney did not have to investigate.
Clearwater further points out that Scientology continues to claim that the
ordinance unconstitutionally vests excessive and vaguely defined discretion in
city enforcement officials. Clearwater points out that Scientology said that
enforcement provisions of the new law, and the City Attorney's investigatory
powers under the new law, were 'substantially identical' to those included in
the prior ordinance and that in the amended law 'The regulation of solicitation
of members ... is accomplished by a far more pernicious method' than formerly.
Defendants' Response Memo, p. 9, citing Prehearing Memorandum, pp. 10, 13.
Therefore, Clearwater contends, Scientology did not prevail on significant
issues that achieved some of the benefit they sought in bringing suit by
deleting the definition of member and altering the provision regarding the
discretionary power of city officials. Further, Clearwater argues, Scientology
did not reach the threshold test for attorneys' fees set out in Texas State
Teachers because Scientology's lawsuit, and the changes described above did not
materially alter the parties' legal relationship. Clearwater claims that
Scientology's actions and representations demonstrate that it is not a
prevailing party because Scientology raised all of the same claims in its
complaint against amended Ordinance No. 3479-84 that it had raised in its
complaint against Ordinance No. 3091-83.
The Court finds unpersuasive Scientology's argument that the changes in the
provisions above materially altered the parties' legal relationship. The Court
measured the extent of the alteration in the legal relationship by comparing
Scientology's allegations as to the membership provisions in Ordinance No.
3091-83 with its allegations as to the membership provisions in Ordinance No.
3479-84. Scientology argued *332 about the membership provisions in
Ordinance No. 3091-83:
In the present case, the Ordinance on its face has a similar disparate effect
as did the membership exemption in the Larson case, and cannot be justified by
a compelling interest.
Most important is the limited membership exemption created by the Ordinance,
which exempts from the scope of the Ordinance organizations where "the
solicitation is in the form of a donation or collection that occurred within
the membership ..." Section 100.01(1). This exemption, however, is
significantly narrowed by the definition of "member" as "any person regularly
attending or participating in a charitable organization." Section
100.01(5). Thus, only churches which limit their solicitation to those who
regularly attend or participate in church services remain exempt. Churches
which obtain contributions from members who participate in church services on
an episodic basis, as well as church which do not offer, encourage, or require
"regular" attendance or "regular" participation of their members, whatever that
means are singled out for differential treatment ... The Ordinance is
Unconstitutional because it seeks to regulate relations between a church and
its members. The Ordinance applies, by its terms, to solicitations by a church
of its own members for the general fund-raising purposes of the church, except
if the church solicits only from members who regularly attend or participate in
church services or activities.
Plaintiff's Prehearing Memorandum of Law [hereinafter Plaintiff's
Prehearing Memo], pp. 6, 10.
Scientology argued, about the membership provisions in Ordinance No. 3479-84:
The Ordinance attempts to regulate solicitations by churches of their own
members for the general fundraising purposes of such churches, to regulate
relations between churches and their members by compelling disclosure of
confidential financial data to members upon request, and to foment dissent
within the membership of churches by empowering any individual member to compel
disclosure of confidential data.
Complaint, Case 84-719, p. 43.
The similarity of Scientology's objection to the membership provision in
Ordinance No. 3479-84 convinces the Court that any alteration in the legal
relationship of the party caused by deleting the definition of member was de
minimis at best. Therefore, Scientology's claim that it is a prevailing party
because the definition of member was deleted is not persuasive.
Likewise, Scientology's argument that it is a prevailing party because changes
were made in the city authority's power to investigate is also unpersuasive.
Scientology argued about Ordinance No. 3091-83:
The Clearwater Ordinance is fatally vague in two respects. First, it vests
unlimited discretion in the City Attorney for its enforcement, in the following
(1) Under Section 100.06(1), the City Attorney "may," but need not,
investigate an organization against which ten complaints have been filed. No
standards are set forth to govern the City Attorney's decision whether to
(2) Similarly, under Section 100.06(4), the City Attorney "May," but need
not, institute legal proceedings to prosecute a violation of the Ordinance. No
standards are set forth to govern the City Attorney's decision whether to
(3) Under Section 100.06(2), the City Attorney may subpoena "any person"
and require the "production of relevant documents and records." No standards
are established to govern the exercise of this discretionary authority.
(4) Under Section 100.03(2), the City Clerk is empowered to determine the
sufficiency of a registration statement and, presumably, to issue a Certificate
of Registration. Under Section 100.03(3), the City Clerk can refuse to
issue a Certificate of Registration if there is a "compelling and substantial
government interest" to justify the denial of a certificate. Any under
Section 100.04(2), the City *333 Clerk may determine whether any
organization's recordkeeping is insufficient, and may declare a "default" upon
such a finding. No standards are established to govern the City Clerk in
making these determination, and no explanation is given as to the meaning or
consequences of a "default."
(5) Under Section 100.05(1)(b), the City Attorney is empowered to
determine the truthfulness and/or sufficiency of a registration statement, and
to seek criminal and civil penalties for the filing of an untruthful or
insufficient statement. No standards are provided for the exercise of this
extraordinary censorship authority.
Such broad discretion permits, indeed invites, the City Attorney and
the City Clerk to engage in selective and discriminatory enforcement, and
provides insufficient standards against which his conduct may be measured.
Plaintiff's Prehearing Memo, pp. 28, 29.
Scientology argued, about Ordinance No. 3479-84:
The City Attorney's power to investigate and prosecute Section 10.05(1)(c)
of the Ordinance (which prohibits the "use of any scheme or artifice to defraud
or obtain property by means of any false statement or representation") provides
another example of the Ordinance's unconstitutional infringement on the
relationship between churches and their members ... the primary vice of the
Ordinance lies in the broad and undefined discretion it vests in its enforcing
officials. The Clearwater Ordinance confers excessive authority on the
Clearwater officials, thereby allowing them not only to engage in selective and
discriminatory enforcement, but also to interfere with protected activities in
several significant respects.
First, pursuant to section 100.03(2) of the Ordinance and Section
100.05(1)(b), the City Clerk and City Attorney, respectively, are given the
authority not only to determine the sufficiency of registration statement, but
in the case of the City Attorney, the trust or falsity of information contained
Second, pursuant to Section 100.06, the City Attorney is given
extraordinarily broad powers to investigate and prosecute violations of the
Ordinance, including by use of subpoenas to compel the production of persons or
documents, and by the institution of legal proceedings.
Plaintiff's Memorandum in Support of Its Motion for Partial Summary Judgment
[hereinafter Plaintiff's Summary Judgment Memorandum, pp. 32, 42, 43.
Again, the similarity of Scientology's objection to the provision in Ordinance
No. 3479-84 convinces the Court that any alteration in the legal relationship
of the party caused by the change was de minimis.
The Court also measured the change in the parties' legal relationship by
comparing the allegations Scientology made in its complaints against the two
ordinances. Scientology's complaint against Clearwater based on Ordinance No.
3091-83 asked for relief based on the issues of allegedly bad motive, allegedly
discriminatory impact on Scientology, allegedly unconstitutional requirements
of maintaining and disclosing information, alleged overbreadth and vagueness,
allegedly excessive discretion given the City Attorney, alleged governmental
entanglement with religion, alleged violation of rights of privacy, alleged
violation of rights of free speech, and alleged illegality of prohibiting a
variety of acts. Scientology's amended complaint in 84-96 against Ordinance
No. 3479-83, and its complaint in 84-719 against Ordinance No. 3479-84 rest on
essentially the same allegations as its original complaint against Ordinance
Neither Scientology nor Clearwater cited a case that set out the meaning of
"materially altering the legal relationship of the parties," and the Court did
not find a case exactly on point. However, Stefan v. Laurenitis, 889 F.2d
363, 369 (1st Cir.1989), provided some guidance. The Stefan Court held that
a monetary settlement is "a resolution of the dispute which changes the legal
relationship" between the parties Stefan, 889 F.2d at 369 (citing Texas
Teachers, *334 489 U.S. at 792, 109 S.Ct. at 1493) when the settlement was
not de minimis and the settlement might deter future harassment of Plaintiffs.
This Court does not imply that a monetary settlement must be present to
materially alter the legal relationship; the Court does, however, insist that
a material alteration in the parties' legal relationship in the Plaintiff's
favor result before the Court can determine that Plaintiff is a prevailing
party deserving of attorneys' fees. When, as in this case, Plaintiff remains
in essentially the same position, or perhaps in a worse position after a
lawsuit, the Court cannot find that Plaintiff prevails. The similarity of
Scientology's allegations in its suits against Ordinance No. 3091-83 and
Ordinance No. 3479-84 convinces the Court that there was no material alteration
in the parties' legal relationship as a result of Plaintiff's lawsuit 84-96.
The Court finds that Scientology did not meet the test for prevailing party
status because its lawsuit in 84-96, did not vindicate Scientology's rights;
did not force Clearwater to cease its challenged behavior; and did not
materially alter the legal relationship between Scientology and Clearwater.
Therefore, Scientology's motion for attorneys' fees is denied. Accordingly, it
ORDERED that Case No. 84-96-Civ-T-17 is dismissed, with prejudice; it is
ORDERED that PLAINTIFF CHURCH OF SCIENTOLOGY FLAG SERVICES ORGANIZATION's
motion for attorneys' fees in Case No. 84-96-Civ-T-17 is denied.
DONE AND ORDERED.
CLEARWATER ORDINANCE 3479-84
Clearwater Ordinance 3479-84 applies to charitable organizations that solicit
funds or property within Clearwater and to charitable organizations that offer
within the city to make sales of property including, but not limited to books,
tapes, publications and brochures whose proceeds will be used for charitable
purposes. Section 100.01. The ordinance exempts organizations that
annually collect monies from less than twenty people in Clearwater or that
annually collect less than $10,000 there. Section 100.02.
Covered organizations must file a registration statement with the City
Clerk. Section 100.03. The statement requires the organization to provide
information about the collection and disbursement of funds, including names,
addresses, and phone numbers of the soliciting organization, the person in
charge of soliciting funds in Clearwater, and the person authorized to disburse
those funds; a description of the soliciting organization, the methods of
solicitation and the use to be made of the funds; the time period of the
solicitation; and estimate of salaries, fees and costs to be incurred in
soliciting; the names of organization officials or solicitors who have been
'convicted of serious crimes in the last five years; the names of other
Florida cities in which the organization has solicited; and a statement that
the organization maintains records or documents necessary to file the
registration statement. The registration is a public document.
An organization that files similar information elsewhere may submit that
filing in lieu of the registration statement. An organization that solicits
only from members may provide the information to its members in a private
statement, available only to members, in lieu of the registration statement.
The organization must prepare the statement at least annually, must maintain
the underlying records for three years from the date of each statement, and
must make the records and statement reasonably available for inspection by each
member of the charitable organization. Section 100.02(3).
After an organization files its registration statement, the City Clerk
must either issue a Certificate of Registration within ten working days or tell
the organization what required information is missing from the statement.
Section 100.03(2). If the Clerk does not issue a Certificate of
Registration, the organization can continue to solicit in Clearwater without
the statement until the Clerk's decision is upheld by a court. Section
100.03(3). The City bears the burden of initiating court proceedings,
*335 which it must do within ten working days of the refusal of a permit.
Id. In such proceedings, the organization can show that the missing
information should not be required because furnishing it would impose a special
hardship on the organization. Section 100.03(4).
The registration statement is effective for one year. Sixty days after the
year is over, the organization must file a statement containing information as
to the amount of funds and property collected in Clearwater during the year;
the costs incurred for wages, fees, advertising, and other expenses; and the
utilization of the proceeds in approximate amounts. Section 100.03(8).
Under the ordinance, certain acts are unlawful. These include willful failure
to file required statements or knowingly filing false statements, fraud or
misrepresentation to obtain money or property; promising any person that the
proceeds of a solicitation of funds will be refunded upon request, and
thereafter willfully failing to make a written refund request within 60 days;
promising any person that he or she will receive a refund upon request without
providing a written statement of the refund terms and conditions; knowing
misrepresentation that a donor will obtain a federal tax deduction, willful use
of solicited funds to commit a crime, and willful failure to maintain required
records. Section 100.05.
The City Attorney is empowered to investigate alleged violations of the
ordinance, but only if he has received ten bona fide, sworn complaints setting
forth facts showing a violation and harm. Section 100.06(1). In an
investigation, the city attorney can subpoena persons and records, Section
100.06(2), but he has no power to enforce his subpoenas and must go to court
for enforcement. If an investigation shows probable cause to believe a
violation exists, the City Attorney can prosecute. Section 100.06(3).
Finally, the statute contains an explicit severability clause.