The US Supreme Court has issued a unanimous opinion in Sole v. Wyner (No. 06-531) (docket listing here), a case involving whether a party who obtains a preliminary injunction -- but ultimately loses the case on the merits -- can be a "prevailing party" entitled to civil rights attorneys fees. The Court, in an opinion by Justice Ginsburg, answered no. I've previously posted about the case background here, and the oral arguments here. SCOTUSblog summarizes the opinion here, and National Public Radio reports on the case here (with audio).
This case has impact on land use litigation. A key federal civil rights law, 42 USC § 1988, allows the prevailing party to recover attorneys fees from the other side. The right to own and make economically beneficial use of property is one of those federal civil rights, and land use and property issues are often litigated under 42 USC § 1983, so attorneys fees may be available to the winning party.
A few of us predicted a "slam dunk" reversal, since obtaining a preliminary injunction, but losing summary judgment on the merits is not, in any real sense "prevailing" in litigation: you have to be ahead at the end of the game to be deemed to have "won," not just after the first quarter.