Second Circuit Reaffirms No “Prevailing Party” Status After Forum Non Conveniens Dismissal; Rule 41(d) Cost Awards Are Discretionary and Unresolved as to Foreign Dismissals

Second Circuit Reaffirms No “Prevailing Party” Status After Forum Non Conveniens Dismissal; Rule 41(d) Cost Awards Are Discretionary and Unresolved as to Foreign Dismissals

Introduction

In Paulo v. Agence France-Presse, No. 24-303 (2d Cir. Oct. 27, 2025) (summary order), a Second Circuit panel (Judges Leval, Sullivan, and Kahn) affirmed the Southern District of New York’s denial of attorneys’ fees and costs to Agence France-Presse (“AFP”) and two Getty Images entities following a forum non conveniens dismissal of a pro se copyright action filed by Leong Francisco Paulo of Lisbon, Portugal. The appeal presented two fee-shifting pathways: (1) fees and costs under Section 505 of the Copyright Act and (2) costs (and asserted fees) under Federal Rule of Civil Procedure 41(d).

The panel’s order—non-precedential by its terms—nonetheless provides clear guidance: a defendant who wins a forum non conveniens dismissal is not a “prevailing party” under 17 U.S.C. § 505 in this Circuit; CRST Van Expedited, Inc. v. EEOC does not disturb that rule; and Rule 41(d) awards are discretionary, with the Second Circuit declining to decide whether the phrase “any court” in Rule 41(d) encompasses prior litigation in foreign tribunals.

Summary of the Opinion

The Second Circuit affirmed the district court’s denial of AFP/Getty’s requests for attorneys’ fees and costs on two independent grounds:

  • Section 505 of the Copyright Act: The court held that defendants who obtain a dismissal on forum non conveniens grounds are not “prevailing parties” under § 505, reaffirming Dattner v. Conagra Foods, Inc., 458 F.3d 98 (2d Cir. 2006). The panel rejected appellants’ argument that the Supreme Court’s CRST decision abrogated Dattner.
  • Rule 41(d): Although the parties briefed whether “any court” in Rule 41(d) includes foreign courts—a question of first impression—the panel declined to decide it. Instead, it affirmed on the ground that Rule 41(d) relief is permissive, and the district court did not abuse its discretion in denying costs because Paulo’s claims were not frivolous, unreasonable, or motivated by bad faith, and because the forum non conveniens dismissal was conditional (leaving open a potential return to SDNY if Portugal declined to hear the case).

The court pointed out that if defendants prevail in Portugal, they may seek fee-shifting relief there, and if the matter returns to the United States and defendants later prevail on the merits, they may then seek § 505 fees.

Analysis

Precedents Cited

  • Dattner v. Conagra Foods, Inc., 458 F.3d 98 (2d Cir. 2006): The cornerstone of the panel’s § 505 analysis. Dattner holds that a defendant who secures dismissal on forum non conveniens grounds is not a prevailing party because such a dismissal does not preclude refiling in another forum and therefore does not effect a judicially sanctioned change in the parties’ legal relationship. The panel applied Dattner directly and emphasized that it remains controlling in the Second Circuit.
  • Manhattan Review LLC v. Yun, 919 F.3d 149 (2d Cir. 2019): Post-CRST reaffirmation of Dattner. The panel invoked Manhattan Review to show that even after the Supreme Court clarified in CRST that a merits ruling is not necessary for prevailing-party status, the Second Circuit has continued to treat forum non conveniens dismissals as non-prevailing for fee purposes because they lack preclusive effect and do not materially alter the legal relationship between the parties.
  • CRST Van Expedited, Inc. v. EEOC, 578 U.S. 419 (2016): The Supreme Court held that a defendant can be a prevailing party without a decision on the merits. The Second Circuit explained that CRST did not address, let alone overrule, Dattner or the distinct features of forum non conveniens dismissals. The panel’s harmonization is straightforward: while a non-merits ruling can confer prevailing status, not all non-merits rulings do—particularly those, like FNC dismissals, that do not preclude future litigation and therefore do not alter the legal relationship.
  • Lackey v. Stinnie, 604 U.S. 192, 204 n.* (2025): The Supreme Court recently acknowledged that it is an open question whether a defendant must obtain a preclusive judgment to “prevail.” The panel cited this footnote to underscore that the broader doctrinal contours remain unsettled at the Supreme Court level, but that nothing in Lackey disturbs Dattner’s specific holding about forum non conveniens dismissals.
  • Scarangella v. Group Health, Inc., 731 F.3d 146 (2d Cir. 2013) and Lilly v. City of New York, 934 F.3d 222 (2d Cir. 2019): These decisions supply the standard of review: prevailing party status and legal standards for fee awards are reviewed de novo, with remaining aspects of a fee denial reviewed for abuse of discretion.

Legal Reasoning

The panel’s reasoning proceeds in two steps corresponding to the two sources of requested relief:

  1. Section 505 “Prevailing Party” Requirement:
    • The touchstone of prevailing-party status across fee-shifting statutes is a judicially sanctioned, material alteration of the legal relationship between the parties. A forum non conveniens dismissal, by design, does not have preclusive effect on the merits and anticipates further litigation in an appropriate forum. As Dattner emphasized, the defendant remains exposed to the plaintiff’s claims elsewhere.
    • Because Paulo can litigate (and is litigating) in Portugal—and might even return to SDNY if the Portuguese court declines jurisdiction—the defendants have not achieved the kind of conclusive, rights-altering victory that § 505 uses to trigger fee-shifting. Hence, they are not “prevailing parties.”
    • CRST does not compel a different result. CRST established that a merits ruling is not required, but it did not address dismissals like forum non conveniens that lack preclusive effect. The panel further noted that, after CRST, the Second Circuit in Manhattan Review reaffirmed Dattner’s rule in the specific FNC context.
  2. Rule 41(d) Costs (and Asserted Fees):
    • Rule 41(d) permits a court to order a plaintiff who previously dismissed an action in “any court” to pay “all or part of the costs of that previous action” when the plaintiff later refiles “the same claim against the same defendant.”
    • The parties disputed whether “any court” includes foreign courts—an issue of first impression, which the panel recognized may be novel in any circuit. The panel declined to decide that question because Rule 41(d) is permissive, not mandatory.
    • Exercising its discretion, the district court had declined to award costs for essentially the same reasons it would have denied § 505 fees even if defendants were prevailing parties: it did not find Paulo’s claims frivolous, unreasonable, or brought for an improper motive; the FNC dismissal was conditional; and the litigation could proceed in Portugal or return to SDNY. This exercise of discretion was not an abuse.
    • Practically, the panel highlighted that if defendants ultimately prevail in Portugal, they may seek costs and fee-shifting there; and if the case returns stateside and defendants later prevail on the merits, they may pursue § 505 fees then.

Impact

Although this is a summary order without precedential effect, it reinforces several important practices and expectations in transnational copyright litigation:

  • Fee motions after forum non conveniens: In the Second Circuit, defendants should not expect § 505 fees when their only U.S. “win” is an FNC dismissal. Dattner remains good law, and post-CRST attempts to recharacterize FNC dismissals as prevailing victories will fail.
  • Rule 41(d) strategy: Even if defendants can satisfy the threshold predicates for Rule 41(d) (including the unsettled “any court” question as to foreign dismissals), awards are discretionary. The absence of frivolousness, unreasonableness, or improper motive—and especially a conditional FNC dismissal—will often militate against shifting costs.
  • International coordination: Defendants who secure FNC dismissals should consider fee-shifting mechanisms in the foreign forum, as the panel expressly noted with respect to Portugal. Preserving the ability to seek fees abroad can be a decisive practical consideration.
  • Timing matters: If litigation returns to the United States and the defendant later prevails on the merits, § 505 fee applications can be renewed at that time. This order signals judicial reluctance to front-load fee-shifting before the merits have been conclusively resolved anywhere.
  • Doctrinal stability post-CRST and Lackey: The Second Circuit’s approach signals continuity—CRST’s recognition that merits rulings are not strictly necessary does not erase the requirement that a judgment materially alter the legal relationship, and Lackey’s footnote confirms the Supreme Court has not foreclosed consideration of preclusivity in the prevailing-party analysis.

Complex Concepts Simplified

  • Forum Non Conveniens: A doctrine allowing a court to dismiss a case when a different forum is substantially more convenient and appropriate, even though the original court technically has jurisdiction. Such dismissals are typically “conditional” (for example, conditioned on the defendant accepting jurisdiction in the alternative forum) and are not rulings on the merits of the claims.
  • “Prevailing Party” under § 505: To be a prevailing party entitled to fees, a litigant must generally obtain a judicially sanctioned, material change in the parties’ legal relationship. A mere change of forum without precluding future litigation typically does not qualify.
  • Non-merits dismissals and CRST: The Supreme Court has recognized that dismissals not addressing the merits can sometimes create prevailing-party status. But whether a particular non-merits dismissal qualifies depends on whether it materially and conclusively alters the parties’ legal relationship—something a forum non conveniens dismissal does not do.
  • Rule 41(d) Costs: This rule discourages duplicative litigation by allowing a court to order a plaintiff who dismisses and refiles the same claim to pay the “costs of the previous action.” The rule is permissive. Whether “any court” includes foreign courts remains unresolved in this order; the panel also did not need to address whether “costs” under Rule 41(d) encompass attorneys’ fees.
  • Standards of Review:
    • Legal determinations about “prevailing party” status and fee standards: reviewed de novo.
    • Denial of fees or costs otherwise: reviewed for abuse of discretion—i.e., whether the district court relied on clearly erroneous facts, misapplied the law, or made a decision outside the range of permissible choices.
  • Conditional Dismissal: A dismissal that sets conditions, such as permitting re-filing if the alternative forum declines jurisdiction. This underscores why a forum non conveniens dismissal lacks preclusive effect and generally will not confer prevailing-party status.

What the Court Did Not Decide

  • Scope of Rule 41(d)’s “any court”: The panel flagged, but expressly left open, whether “any court” includes foreign tribunals.
  • Whether “costs” under Rule 41(d) include attorneys’ fees: The order did not reach this question, resolving the appeal purely on the discretionary nature of Rule 41(d) and the district court’s case-specific reasoning.
  • Whether a preclusive judgment is always necessary to “prevail”: The panel noted the Supreme Court’s statement in Lackey that this remains an open question, but that uncertainty does not disturb the Second Circuit’s Dattner rule in the forum non conveniens setting.

Practical Takeaways for Litigants

  • Defendants: If you obtain a forum non conveniens dismissal in the Second Circuit, do not expect § 505 fees based on that victory alone. Build your record in the foreign forum for possible fee shifting there, and preserve rights to seek § 505 fees if the case returns and you later prevail on the merits.
  • Plaintiffs: A forum non conveniens dismissal will not normally expose you to § 505 fees in the Second Circuit. But be mindful that foreign courts may shift fees to prevailing parties, and that refiling can invite Rule 41(d) motions—though awards are discretionary and often hinge on the reasonableness of your litigation conduct.
  • Both sides: When briefing Rule 41(d), address (1) whether the prior dismissal falls within “any court” (including, where relevant, foreign tribunals), (2) whether the refiling involves the “same claim” against the “same defendant,” and (3) why discretion should or should not be exercised—focusing on reasonableness, motives, and any conditions attached to the dismissal.

Conclusion

The Second Circuit’s summary order in Paulo v. Agence France-Presse underscores the continuing vitality of Dattner: defendants who secure a forum non conveniens dismissal are not “prevailing parties” under § 505 because such dismissals do not preclude further litigation or materially alter the legal relationship of the parties. The panel further confirms that Rule 41(d) is a discretionary tool; even assuming the rule could reach prior foreign litigation, a district court may deny costs where claims are not frivolous or improperly motivated and where the forum non conveniens dismissal is conditional.

While non-precedential, the order is a clear signpost for transnational copyright disputes: fee-shifting in the Second Circuit generally awaits a conclusive victory on the merits or a comparably preclusive outcome, and efforts to leverage non-merits, non-preclusive rulings into fee awards will meet with skepticism. Parties should therefore calibrate litigation strategy with an eye toward the forum where the merits will ultimately be resolved—and where fee-shifting will most plausibly be available.

Key Citations

  • Paulo v. Agence France-Presse, No. 24-303 (2d Cir. Oct. 27, 2025) (summary order).
  • Dattner v. Conagra Foods, Inc., 458 F.3d 98 (2d Cir. 2006).
  • Manhattan Review LLC v. Yun, 919 F.3d 149 (2d Cir. 2019).
  • CRST Van Expedited, Inc. v. EEOC, 578 U.S. 419 (2016).
  • Lackey v. Stinnie, 604 U.S. 192, 204 n.* (2025).
  • Scarangella v. Group Health, Inc., 731 F.3d 146 (2d Cir. 2013).
  • Lilly v. City of New York, 934 F.3d 222 (2d Cir. 2019).
  • Paulo v. Agence France-Presse, No. 21-cv-11209, 2023 WL 2707201 (S.D.N.Y. Mar. 30, 2023) (district court decision referenced).

Note: As a “Summary Order,” the decision has no precedential effect under Second Circuit Local Rule 32.1.1, but it may be cited as permitted by Federal Rule of Appellate Procedure 32.1.

Case Details

Year: 2025
Court: Court of Appeals for the Second Circuit

Comments