On October 16, 2017, EPA Administrator Pruitt issued a memo to his agency directing that managers take certain steps to curtail the practice known as “sue and settle.” This practice most often is used for relatively quick resolution of citizen suits by environmental groups against the EPA involving the agency’s failure to comply with statutory deadlines for issuance of regulations. The memo provides, inter alia, for developing a list of consent decrees and settlement agreements governing agency actions, including attorneys fees paid; notifying regulated parties and states of such citizen suits when filed, with various provisions to allow such parties to participate in negotiations and litigation; and a refusal to pay attorneys fees as part of any settlement, on the grounds that in a settlement, there is no “prevailing party.”

Background

Loosely defined, “sue and settle” is a pejorative description used by the political party out of power to complain that the incumbents roll over for friends who file suits challenging unfavorable regulatory or statutory provisions. Both parties can dredge up examples of the alleged practices cited by Pruitt – alleged sweetheart settlements or forum-shopping for favorable courts who issue nationwide injunctions. But in the recent past, it has been used by Republicans more specifically to refer to suits filed by environmental groups to force agencies – particularly EPA, which is subject to many such statutory mandates —to comply with non-discretionary statutory deadlines for issuance of regulations and other actions.

Republicans complained regularly throughout the Obama Administration that when such suits were filed, the agencies then quickly settled the cases through negotiations in which the regulated industry had no role, and paid significant attorneys fees to the attorneys for the settling plaintiffs. Environmental groups and other plaintiffs consider this a “phantom issue” since in their view, the cases often offered the government little recourse but to negotiate an acceptable timeline for compliance, and the statutes generally provide for attorneys fees to the prevailing party.

There is truth on both sides of this argument, but it is also true that this is a bipartisan issue, depending on whose ox is being gored. It is not entirely surprising that settlements are negotiated between the parties to the litigation, without the involvement of other interested groups. But the result is not necessarily a one-sided deal. The settlements over issuance of regulations do not dictate the substance of the regulation, only the schedule of agency issuance of the regulation. In the case of a settlement, all interested parties will have an opportunity to comment on the schedule, but only the environmental group plaintiffs will have been involved earlier in the process. To the extent that earlier access is important, the new process is intended to provide earlier access to all parties. It remains to be seen how evenhanded that process will be in practice.

What it Means

One almost inevitable outcome of the new process will be more hard fought litigation. Multi-party negotiations make it likely that more matters will go to full litigation, even though the mandatory schedule issues come close to being the “slam dunks” that are almost never found in the law. That will leave scheduling issues in the hands of a judge, not the parties, an outcome that the agency may come to rue. And a battle over attorneys fees – which will most likely result in incurring more attorneys fees – is likely in every piece of litigation, unless Administrator Pruitt exercises his authority to waive that provision of his memo for such settlements.

The real problem is not addressed at all by this memo. The agency has not been given sufficient resources to meet statutory deadlines, many set decades ago to require periodic regulatory reviews. Accordingly, when EPA prioritizes its resources to meet its current view of the most serious issues, meeting those dates often is low on the list. If it is worried about these suits, Congress could either change the statutes or provide adequate resources. It has chosen to do neither, which may in the end simply mean more of the limited resources being spent on litigation.