In the case of Buckhannon Board and Care Home, Inc. v. West Virginia Department of Health and Human Resources (2000), the U.S Supreme Court ruled that a plaintiff cannot be considered a "prevailing party" entitled to attorney's fees under federal statutes unless they secure either a judgment on the merits or a court-ordered consent decree. The decision came after Buckhannon Board and Care Home sued West Virginia’s Department of Health for violating both state law and the Federal Fair Housing Amendments Act by forcing them to close if they did not meet certain fire safety regulations. While their suit was pending, however, West Virginia changed its laws in line with what Buckhannon wanted; thus, no final judgement was made in court since there were no longer any legal issues to resolve. Despite this victory outside of court, when Buckhannon sought compensation for attorney's fees as is customary for prevailing parties in such cases, it was denied due to lack of formal judicial action marking them as victorious.

The dissenting opinion in the case of Buckhannon Board and Care Home, Inc. v. West Virginia Department of Health and Human Resources argued that the majority's decision to reject the "catalyst theory" was a departure from precedent without sufficient justification. The catalyst theory allows plaintiffs to recover attorney’s fees if their lawsuit brings about a voluntary change in the defendant’s conduct, even if they do not obtain a formal court judgment or settlement agreement. The dissenters believed this approach incentivized public interest litigation by ensuring lawyers could be compensated for successful cases that did not result in judicial orders or settlements but nonetheless achieved desired outcomes through other means such as policy changes or voluntary cessation of harmful behavior by defendants. They feared that rejecting this theory would discourage such lawsuits, undermining enforcement of federal laws designed to protect civil rights, environmental interests, and other important societal values.