May 10, 2013

Congress Considers Limits on “Sue and Settle” Lawsuits

Editor’s Note:  Another name for “Sue and Settle” is Regulation by Litigation.

From: RegBlog

Eric Lorber

Can private individuals and organizations use so-called “sue and settle” lawsuits to set federal environmental regulatory policy without going through the normal regulatory process?

Concerned that environmental groups are employing this tactic to secure environmentally-friendly regulations, congressional Republicans have proposed the Sunshine for Regulatory Decrees and Settlements Act of 2013. The Act – sponsored by Senator Chuck Grassley (R-IA) and Representative Doug Collins (R-GA) – aims to prevent these sue and settle lawsuits, which  arguably allow environmental groups to undermine the public’s ability to comment on pending regulations.

In sue and settle lawsuits, a pro-regulation group sues a federal agency – usually the Environmental Protection Agency (EPA) – when that agency fails to meet a deadline for issuing a new regulation. Given the complexity of new regulatory programs, the agencies often fail to meet their statutorily imposed deadlines. To resolve the litigation – and avoid the high costs of a protracted legal battle – the agencies frequently agree to court-affirmed settlements with the pro-regulation groups.

These decrees – negotiated without the regulated industry’s input –set new deadlines for the issuance of regulations. As a result, the regulated industry, the Office of Information and Regulatory Affairs (OIRA), and the public have less time to provide comments on or seek to influence pending regulations.

According to Senator Grassley, the sue-and-settle tactic undermines the ability of citizens and regulated industries to “have a meaningful opportunity to participate in the rulemaking process.”  He argues that that the proposed legislation “help[s] ensure the procedure and process used to create these regulations are made in the open.”

Senator Grassley and Representative Collins suggest their bill will enhance public participation and transparency, thereby by “preserving the integrity of the rulemaking process.”

The bill would first require agencies publish – and report to Congress – information related to sue-and-settle lawsuits, such as notices of intent to sue, complaints, decrees, and settlements.

Second, the Act would prohibit agencies from proposing sue-and-settle decrees until parties affected by the proposal regulations can intervene and participate in the negotiations. In addition, agencies would not be allowed to propose such settlements until after the settlements are published and the public is given an opportunity to comment.

Third, the Act would provide courts with additional powers to review decrees and settlements, including the ability to review, de novo, any new administration’s motion to modify a consent decree. The Act would also require that courts weighing proposed decrees comply with normal rulemaking procedures.

In addition, the Attorney General would be required to approve the proposed decree if it converts discretionary authorities granted to the agency into mandatory duties which the agency must undertake.

The bill is similar to one initially proposed in 2012 which never made it to the floor of either the House or the Senate. While only Republicans currently sponsor the bill, Senator Grassley and Representative Collins are reportedly looking across the aisle to foster bipartisan support.

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