Case Summary:
Creditor filed an adversary proceeding seeking to determine the dischargeability of his debt. After a trial on the merits, the Court dismissed the case. Debtor’s counsel filed a motion for attorney fees pursuant to 11 U.S.C. § 523(d). While the legal and factual positions taken by the Creditor to litigate the dischargeability (of what the Court determined to be a consumer debt) were not substantially justified, special circumstances existed to deny the motion. Attorney fees under § 523(d) are only allowed for defending § 523(a)(2) claims. In this case, the amount of resources devoted to defending the § 523(a)(2) action was likely small and the related fees de minimis and hard to determine. Accordingly, the Court found awarding the entire amount requested would be unjust.