Merchant v. Merchant
3:16-cv-00665
S.D. Miss.Mar 11, 2025Background
- Plaintiffs Frank and Dorothy Merchant brought claims against Billy Merchant and George Harkins regarding ownership and proceeds from the sale of real property.
- The claims included civil conspiracy, slander of title, conversion, breach of fiduciary duties, and constructive trust.
- All parties moved for summary judgment, but the court found issues of material fact and denied all motions at that stage.
- After a bench trial, the court dismissed all Plaintiffs’ claims with prejudice, finding that Plaintiffs had conveyed property to Billy to avoid creditors and were barred by the “unclean hands” doctrine from recovery.
- Billy was found to be the rightful owner, his sale to Harkins was upheld, and the court awarded Billy attorney’s fees and costs against Plaintiffs under the Mississippi Litigation Accountability Act (MLAA), totaling $165,635, with an additional amount approved for further litigation expenses.
- Plaintiffs’ subsequent motion for reconsideration and to vacate the fee award was denied; the court found no manifest error or injustice under Rule 59(e).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Frivolity under MLAA | Claims surviving summary judgment cannot be frivolous | Surviving summary judgment does not preclude frivolity | Court held claims were frivolous under MLAA |
| Fee Calculation | Fee award should be minimized or reduced due to circumstances | Fee award reasonable and warranted by litigation facts | Full fee award (and later additional fees) upheld |
| Remedy for Defendant | Limit or offset fees based on sale proceeds | Plaintiffs' arguments meritless; full recovery sought | Plaintiffs' alternative fee reductions rejected |
| Standard for Reconsideration | Entitled to reconsideration to prevent injustice | No valid ground for reconsideration under Rule 59(e) | No basis for reconsideration; motion denied |
Key Cases Cited
- Chambers v. NASCO, Inc., 501 U.S. 32 (U.S. 1991) (authorizing sanctions and attorney’s fees for bad faith conduct)
- Simon v. United States, 891 F.2d 1154 (5th Cir. 1990) (Rule 59(e) is not for relitigating decided issues)
- Johnson v. Georgia Hwy. Express, Inc., 488 F.2d 714 (5th Cir. 1974) (outlining criteria for reasonable attorney’s fee calculation)
- Bay Point Props., Inc. v. Miss. Transp. Comm’n, 304 So.3d 606 (Miss. 2020) (endorsing lodestar and reasonableness factors for attorney’s fees)
- In re Estate of Gillies, 830 So.2d 640 (Miss. 2002) (reasonableness of attorney’s fees under Mississippi law)