A bill to provide a special defense to the liability of political subdivisions to States under section 1979 of the Revised Statutes (42 U.S.C. 1983) relating to civil actions for the deprivation of rights.

Amends the Civil Rights Act of 1964 (Revised Statutes) to prohibit the award of damages against any Federal, State, or local governmental entity in any action for the deprivation of rights where the court finds that the officials involved acted in good faith.

Amends the Civil Rights Attorneys' Fees Awards Act of 1976 to limit the award of Attorneys' fees in certain civil rights actions. States that attorneys' fees should be awarded: (1) to prevailing plaintiffs unless special circumstances would make the award unjust; and (2) to prevailing defendants if the plaintiff's claim is found to be frivolous, unreasonable, or groundless, or that the plaintiff persisted in litigating after it clearly became so, even though there was no subjective bad faith.

Allows attorneys' fees where a party prevails on another claim which is merely pendent to a civil rights claim only if the court finds that the civil rights claim has sufficient merit to have justified a separate suit.

Prohibits the award of fees for any litigation following rejection of a settlement offer substantially favorable to the prevailing party.

Allows fees where a claim is mooted by a change in Government policy only if the pendency of the claim was a material factor for such change.

Requires the amount of fees awarded to be based on a reasonable market rate for time reasonably spent on the claims. Prohibits awards based on bonuses or multipliers.

Requires the attorney of a party seeking an award of fees to apply to the court with an itemized statement of hours worked, the nature of the work, and the rates charged.