The Controversy of “Sue and Settle” Gone For Now, But For Good?

The Controversy of “Sue and Settle” Gone For Now, But For Good?

By: Seth Todd

Scott Pruitt is not a well-liked man in the environmental community, and especially was not their first choice to head the Environmental Protection Agency whenever President Trump took office. We recently learned why. Scott Pruitt dropped a bombshell on the environmental community recently, announcing, “The days of regulation through litigation are over. We will no longer go behind closed doors and use consent decrees and settlement agreements to resolve lawsuits filed against the Agency by special interest groups where doing so would circumvent the regulatory process set forth by Congress. Additionally, gone are the days of routinely paying tens of thousands of dollars in attorney’s fees to these groups with which we swiftly settle.”[1] While Scott Pruitt seems to be putting an end to “sue and settle” could it eventually make a comeback?

Pruitt is attempting to change the way that the EPA handles lawsuits, laying out guidelines for how the suits will be conducted and how they will be released to the public for transparency.[2] This ends the tradition that was occurring, of so called “friendship” suits, where the EPA would not defend itself in lawsuits and essentially acquiesce to the desire of whichever environmental group filed suit. [3] By settling with the group, the change that they sued to implement would essentially become law through a consent decree. [4]

Those that opposed the practice of sue and settle claimed that it was a way for politicians to make law, without any of the accountability. Instead of writing the laws themselves, outside environmental groups were being allowed to dictate the law. If the general public complained, the members of Congress could simply point to the consent decrees and claim there was nothing they could have done. [5] It was also an effective way to remove oversight from the executive branch, while possibly binding their successors. [6]

While many people rallied against the policy of “sue and settle”, many environmental groups acted as if it never existed. In defending the practice, the Sierra Club looked to clarify the practice stating that to, “understand the lies behind the false concept of “sue and settle,” one must understand the two main types of negotiated settlements in environmental law: decision-forcing settlements and substantive settlements.” [7] The statement went on to differentiate between settlements that forced Congress to take action on missed deadlines (decision-forcing) and settlements that effectively created law (substantive settlements). [8] The Sierra Club claimed that the end of the “sue and settle” was an attempt to try and restrain environmental groups from filing suit, proclaiming, “If Pruitt thinks that by frivolously litigating deadline cases, he will deter the Sierra Club or other citizen groups from holding him accountable in court, he should think again: We will not be deterred.”[9]

                  Groups are both sides are very passionate when it comes to where they stand on the issue of “sue and settle”. Some view it as a shady backroom way of creating new law, while others view it as an effect way to get Congress to do their jobs. Lucky for both of these groups, we have the Administrative Procedure Act (APA). The APA gives agencies and Congress a set of requirements to follow whenever new regulations are created. Typically, notice agency is required to give public notice of the rulemaking procedure, by posting it in the Federal Register.[10] The notice must include the date the rule is effective, the authority under which it was created, and the substance of the rule.

                  After the agency has given notice, a public review period is started that can last anywhere from 30 days to a year. The public review period can also be reopened if the agency believes longer was needed to hear all public comments. The agency is then required to consider all of the comments in crafting the final rule that will eventually go into effect.[11] By allowing public comment, interested parties are allowed to directly take part in the rulemaking effort. All of the rules created are judicially reviewable, which gives groups an avenue to challenge any rule they believe to be unlawful.[12]

                  If the government began following the standards set in the APA, it would seem to appease both sides of this debate. The APA requirements allow for transparency and public comment, which appeases those that believe “sue and settle” was a shady way of enacting new law. The public comment period and ability for judicial review should satisfy those who believed “sue and settle” was an effective way to get Congress to simply do their jobs. While it may not guarantee environmental groups complete success as they seemed to enjoy under “sue and settle”, it provides a more transparent way to actively effect change.

                  A point to watch going forward is how this will actually play out. Yes, Pruitt pointed out that environmental groups were using “sue and settle” to their advantage, but it remains to be seen the effect it will have on industry groups. Effectively “sue and settle” is only a bad way to create policy if you are on the other side of the aisle. Under the Obama administration “sue and settle” was used to strengthen environmental protections in a time where a Republican controlled Congress fought every move he made. Under the Trump administration does ending “sue and settle” mean it is gone for good? Or, given the inability to effectively push through any real policy in the current Congress, does “sue and settle” revive itself later on down the road? Industry groups could start using the tactic to hold President Trump to his campaign promises. The pro-coal groups could start filing suits in order to repeal stricter laws that were put in place during the Obama administration. Will Scott Pruitt valiantly defend those cases, in front of the same industries that helped push him into the head EPA administrator?

                  While “sue and settle” may be ending, there is still effective ways to create change through following the APA requirements that are mandated under federal law. Transparency will increase through the use of the guidelines, and realistically environmental groups will not be able to guide policy as much as they previously had in the “sue and settle” era.  The question remains, after frustratingly being unable to enact new regulations to reduce the laws governing industries such as coal, does the Trump administration bring back a version of “sue and settle” that favors polluters? 

[1] Administrator Pruitt Issues Directive to End EPA "Sue & Settle", Environmental Protection Agency, https://www.epa.gov/newsreleases/administrator-pruitt-issues-directive-end-epa-sue-settle (last updated October 16, 2017).

[2] Id.

[3]Phil Golberg, Christopher Appel, Victor Shwartz, The Liability Engine that Could Not: Why the Decades-Long Litigation Pursuit of Natural Resource Suppliers Should Grind to a Halt,  12 J.L. Econ. & Pol'y 70 (2016).

[4] Id.

[5] Andrew Grossman, Regulation Through Sham Litigation: The Sue and Settle Phenomenon, The Heritage Foundation (Feb. 25, 2017), http://www.heritage.org/crime-and-justice/report/regulation-through-sham-litigation-the-sue-and-settle-phenomenon.

[6] Id.

[7]Pat Gallagher, Scott Pruitt and the Myth of “Sue and Settle”, Sierra Club (October 18, 2017), http://www.sierraclub.org/sierra/scott-pruitt-and-myth-settle-and-sue. 

[8] Id.

[9] Id.

[10] The Administrative Procedure Act (APA), EPIC.org, https://epic.org/open_gov/Administrative-Procedure-Act.html (last visited Oct. 26, 2017).  

[11] Id.

[12] Id.