From MR Crescent City, LLC v. Draper, 2009 U.S. App. LEXIS 26585 (4th Cir. Dec. 7, 2009):

This case presents a purely legal question: whether 28 U.S.C. § 1447(c) permits the imposition of legal fees on an attorney who erroneously removes a case from state to federal court. The district court held that it does not. We affirm.

The statute, 28 U.S.C. § 1447(c), states in relevant part: "An order remanding [an erroneously removed] case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of removal." The statute, however, does not state expressly who may be required to make such payment. Appellants contend that both removing parties and their lawyers are liable, while appellees assert that only removing parties are liable.

As of yet, no circuit court has confronted this issue, and the district courts that have addressed it are badly divided. [Numerous citations omitted.]***

Appellants argue that because § 1447(c) does not explicitly prohibit a fee award against counsel, it thereby permits it. Appellants, however, have the presumption reversed. The proper presumption is that when a fee-shifting statute does not explicitly permit a fee award against counsel, it prohibits it. In short, silence does not equal consent. Because we find that the presumption is not overcome in this case, we accordingly hold that § 1447(c) does not apply to counsel. ***

The presumption that fee-shifting statutes apply only to parties unless they expressly state otherwise is consistent with the American Rule. Under the American Rule, "the prevailing litigant is ordinarily not entitled to collect a reasonable attorneys' fee from the loser." Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240, 247, 95 S. Ct. 1612, 44 L. Ed. 2d 141 (1975). In other words, the American Rule creates a presumption that parties bear their own legal costs, win or lose. Fogerty v. Fantasy, Inc., 510 U.S. 517, 533, 114 S. Ct. 1023, 127 L. Ed. 2d 455 (1994). The American Rule's presumption can be further subdivided into two distinct underlying premises: first, that parties bear their own legal fees and second, that parties bear legal fees.

Congress is, of course, free to alter either or both of these premises through legislation.... However, departures from the American Rule require "explicit statutory authority." See Buckhannon Bd. & Care Home, Inc. v. West Virginia Dep't of Health & Human Servs., 532 U.S. 598, 602, 121 S. Ct. 1835, 149 L. Ed. 2d 855 (2001). In other words, if Congress wishes to overcome either premise underlying the American Rule, it must express its intent to do so clearly and directly. This is because the American Rule is a longstanding legal principle, see Key Tronic Corp. v. United States, 511 U.S. 809, 815, 114 S. Ct. 1960, 128 L. Ed. 2d 797 (1994), and one "deeply rooted" in our nation's common law tradition, with origins dating back perhaps as early as 1796. Alyeska Pipeline, 421 U.S. at 271, 249-50 (citing Arcambel v. Wiseman, 3 U.S. (3 Dall.) 306, 1 L.Ed. 613, 3 Dall. 306 (1796)). And "[i]n order to abrogate a common-law principle, the statute must 'speak directly' to the question addressed by the common law." United States v. Texas, 507 U.S. 529, 534, 113 S. Ct. 1631, 123 L. Ed. 2d 245 (1993).

Absent explicit authorization from Congress, it is our duty to keep the American Rule intact. "Congress ha[s] not 'extended any roving authority to the Judiciary to allow counsel fees . . . whenever the courts might deem them warranted.'" ... Because fee-shifting statutes are "in derogation of the common law," courts are obligated to construe them strictly, ... employing a "presumption favoring the retention of long-established and familiar principles, except when a statutory purpose to the contrary is evident," ***. This means that unless there is at least some indication that Congress intended attorneys to pay under § 1447(c), we will apply the American Rule's presumption that parties pay.

In this case, it is undisputed that Congress intended § 1447(c) to modify the American Rule in part. Section 1447(c) is, after all, a fee-shifting statute. See Martin v. Franklin Capital Corp., 546 U.S. 132, 137-38, 126 S. Ct. 704, 163 L. Ed. 2d 547 (2005). Thus, the parties agree that § 1447(c) was meant to overcome the first premise underlying the American Rule (that parties bear their own legal fees), thereby enabling courts to shift fees from the prevailing party (here, the party successfully obtaining remand) to the losing party (here, the party erroneously attempting removal). Appellees argue that § 1447(c) stops there, leaving undisturbed the second premise of the American Rule (that parties bear legal fees). That is, whether prevailing or losing, it is nonetheless parties — not attorneys — who bear attorneys' fees. Appellants, on the other hand, would have us depart from the American Rule more radically, by shifting fees not merely from a prevailing litigant to a losing litigant, but from a prevailing litigant to a losing attorney. Under this view, § 1447(c) reverses both parts of the American Rule's presumption, shifting fees and introducing a new payer.

We see no justification for the dramatic deviation from the American Rule advocated by appellants. Neither § 1447(c)'s text nor its legislative history is sufficient to overcome the American Rule's presumption that parties rather than attorneys are liable for attorneys' fees. First, the text of § 1447(c) makes no explicit mention of counsel. And because "Congress legislates against the strong background of the American Rule," Fogerty v. Fantasy, Inc., 510 U.S. 517, 533, 114 S. Ct. 1023, 127 L. Ed. 2d 455 (1994), the fact that Congress did not explicitly exclude counsel from the reach of § 1447(c) is no indication of congressional intent to include counsel. Congress knows that in order to demonstrate an "inten[t] to set aside th[e] longstanding American [R]ule," "[m]ere generalized commands . . . will not suffice to authorize . . . fees." Key Tronic, 511 U.S. at 815 (citations and internal quotations omitted). Indeed, Congress has shown that when it wants to make attorneys liable under fee-shifting statutes, it will do so expressly. For instance, in 28 U.S.C. § 1927, Congress unambiguously empowered courts to require "[a]ny attorney . . . who so multiples the proceedings in any case unreasonably and vexatiously . . . to satisfy personally the excess costs, expenses, and attorneys' fees reasonably incurred because of such conduct." The omission of comparable express authorization in § 1447(c) thus "strongly suggest[s] a deliberate decision not to authorize such awards." See Key Tronic, 511 U.S. at 818-19.

Although the statutory text does not explicitly forbid fee awards against counsel, it does so implicitly. The statute speaks, by implication, only to parties. Section 1447(c) allows a court to impose a fee award in "[a]n order remanding the case," which, as the district court noted, "would normally, if not inevitably, be contemplated as one that pertains to parties and not counsel." ... The most natural reading of § 1447(c) is that it applies solely to litigants, who have a genuine stake in whether or not the case is remanded — and not to attorneys, who may not even remain involved in the case post-remand.

In fact, the Supreme Court has repeatedly emphasized the "crucial connection" between liability on the merits and liability for attorneys' fees under fee-shifting statutes. *** Thus, because attorneys are nonparties not liable on the merits, they are generally outside the ambit of fee-shifting statutes.

Second, our conclusion is confirmed by the legislative history. While such history cannot be used to override statutory text, it can serve as a useful supplement. Like the statute's text, the legislative history here makes no express mention of attorney liability. It defies common sense to think that Congress wished to expand fee liability to encompass lawyers but failed to say anything at all about that wish, at any point, during the statute's consideration. "Such a bold departure from traditional practice would have surely drawn more explicit statutory language and legislative comment." Fogerty v. Fantasy, Inc., 510 U.S. 517, 534, 114 S. Ct. 1023, 127 L. Ed. 2d 455 (1994).

To the contrary, the legislative history suggests that Congress anticipated that § 1447(c) would apply exclusively to litigants. Section 1447(c) was enacted in 1988 to succeed a former statutory provision, which subjected defendants to a "bond requirement." See H.R. 4807, 100th Cong. (1988); 28 U.S.C. § 1446(d) (repealed). Under this bond requirement, defendants had to post a bond, prior to removal, in order to secure payment for costs incurred if removal turned out to be improper. ... Significantly, this bond requirement explicitly applied only to parties, limiting liability to "defendant or defendants." ***

The legislative history states that § 1447(c) was designed merely to "replace the bond provision," H.R. Rep. No. 100-889, at 72 (1988), as reprinted in 1988 U.S.C.C.A.N. 5982, 6033, thus directly substituting a party's obligation to pay costs ex ante with a party's obligation to pay costs ex post. If Congress had intended § 1447(c) not only to change the timing of payments but also to expand the categories of individuals potentially liable for payments, that expansion probably would have generated at least minimal legislative debate. Instead, § 1447(c) was enacted as part of a "noncontroversial," omnibus bill. See 134 Cong. Rec. H7443-02 (Sept. 13, 1988) (statement of Rep. Moorhead). In conclusion, nothing demonstrates a congressional intent to overcome the American Rule in order to make attorneys liable for an adversary's attorneys' fees. ***

Moreover, federal case law corroborates our holding. Indeed, the Supreme Court and other circuits have interpreted fee-shifting statutes with text materially indistinguishable from that of § 1447(c) to be inapplicable to counsel. These cases firmly support the presumption that fee-shifting statutes shift fees only to parties unless they expressly state otherwise.

For example, in Roadway Express, Inc. v. Piper, 447 U.S. 752, 758, n.5, 100 S. Ct. 2455, 65 L. Ed. 2d 488 (1980), the Supreme Court examined fee-shifting provisions in 42 U.S.C. §§ 1988 and 2000e-5(k), which allowed successful plaintiffs "a reasonable attorney's fee as part of the costs," without specifying who was responsible for that "reasonable attorney's fee." The Court declined to make lawyers responsible for fees under those sections, noting that "[n]either § 1988 nor § 2000e-5(k) makes any mention of attorney liability for costs and fees." ... This case fairly stands for the more general proposition that, presumptively, when a fee-shifting statute is silent about who pays attorneys' fees, parties — not attorneys — are accountable.

The presumption is widely held. As the Second Circuit summarized, "When a fee-shifting statute that authorizes the courts to award attorneys' fees . . . does not mention an award against the losing party's attorney, the appropriate inference is that an award against attorneys is not authorized." Healey v. Chelsea Res., Ltd., 947 F.2d 611, 624 (2d Cir. 1991). Other circuits have likewise held that fee-shifting statutes presumptively apply only to litigants. And these courts have so held in a wide array of contexts, interpreting fee-shifting provisions under civil rights statutes, under the Securities Act, under the False Claims Act, under [*14] the Federal Rules of Civil Procedure, and under the Copyright Act. [Citations omitted.]