Press Release from the House Resource Committee:

 Frivolous Enviro Lawsuits Hurt Economy, Environment

For Immediate Release
Tuesday, September 14, 2004
Contact Brian Kennedy or Matt Streit at (202) 226-9019

Washington , DC - Today the House of Representatives passed H.R. 4571, the Lawsuit Abuse Reduction Act (LARA). While this legislation largely targets baseless tort lawsuits, it will also make great strides in stemming the tide of frivolous litigation initiated by environmental fundraising organizations. Regardless of the plaintiff, frivolous litigation chokes the legal system, kills jobs, and hampers economic growth.

H.R. 4571 would restore mandatory sanctions for filing frivolous lawsuits in violation of Role 11 of the Federal Rules of Civil Procedure, requiring monetary sanctions against any party making a frivolous claim, including attorneys' fees. It would also allow Rule 11's provisions preventing frivolous lawsuits to apply to state cases in which a state judge finds the case affects interstate commerce by threatening jobs and economic losses to other states.

"Frivolous lawsuits filed under the guise of environmentalism actually hurt the environment and hinder economic growth at the same time," said House Resources Committee Chairman Richard W. Pombo (R-CA). "Because the environmental organizations that file these suits are entitled to recover taxpayer-funded attorneys' fees and court awards - win or lose - environmental litigation has become big business in America . The American taxpayer should not foot the bill for this, nor should our economy have to suffer the dampening affects these suits cause. These and other frivolous actions prevent the creation of good jobs, which is why I was pleased to support this legislation today."

Some environmental groups are largely unapologetic for this rampant, frivolous litigation. For example, Peter Morton of the Wilderness Society stated in a discussion on federal land use policy that, "If you bid on a lease on public land, you can expect (environmental litigation)" regardless of the merits. (Dow Jones, 01/20/2003)

The assistant attorney general for the Justice Department's Environment and Natural Resources Division has stated that there are 7100 active environmental lawsuits being litigated in the United States today. (Casper Star Tribune, 06/16/2004)

* Frivolous Lawsuits Hinder the Recovery of Endangered Species

The flood of environmental litigation became so great that it bankrupted the Fish and Wildlife Service's fund for critical habitat in May of 2003, (U.S. Department of Interior). According to the Tulane University Environmental Law Journal, "The entire ESA budget runs the risk of being consumed by the bottomless pit of litigation driven listings and designations. It does not end there. As Yogi Berra might say, the bottomless pit is getting even deeper: as soon as the FWS makes a decision driven by a court imposed deadline, it is being sued on the merits of that decision." (16 Tul. Envtl. L.J. 257)

"This is where the FWS is today: the decisions relating to ESA listings and designations, arguably the most important decisions under the law because they trigger all other protections, are driven solely by litigation. The FWS has lost all flexibility in making its own determinations as to which species is most endangered and should be listed first, and which habitat is most vulnerable and should be designated as critical. Litigation-driven actions prioritize only those species that have a plaintiff behind them (and often a larger political objective), rather than those species that are most endangered." (16 Tul. Envtl. L.J. 257)

* Frivolous Lawsuits Jeopardize Vital Forest Health and Fire Prevention Projects

In October of 2003, the U.S. General Accounting Office (GAO) found that 59% of forest fuels reduction projects - performed to reduce the incidence of catastrophic wildfire - were appealed by environmental organizations in FY2001 and 2002. They were found to be overwhelmingly without merit, as 161 of 180 challenges were thrown out. The appeals delayed thinning projects by at least 120 days in FY2001 and FY2002.

* Frivolous Lawsuits Imperil Needed Energy Production & Jobs

In February of this year, seven environmental groups filed suit to stop the federal government from producing much-needed petroleum in a National Petroleum Reserve. The area was set aside in 1923 for that exact purpose. Likewise, environmental groups have even sued to halt "green" energy projects, including windmill farms and clean hydroelectric power.

These frivolous lawsuits drive up the cost of energy for the American taxpayer and threaten the very jobs America needs for a strong economy. "A recent National Association of Manufacturers study found that, on average, U.S. manufacturers spend more than 22 percent more on external, non-labor costs than do their competitors in other leading industrialized nations. Costs for health care, taxes, regulatory compliance, energy and out-of-control litigation are considerably higher in the U.S. than in countries where manufacturing is growing. The costs are barriers to competitive success." (Grand Rapids Press, 09/11/2004)

* Taxpayers Foot the Bill for Frivolous Lawsuits

According to the Sacramento Bee: "Subsidized by federal tax dollars, environmental groups are filing a blizzard of lawsuits that no longer yield significant gain for the environment and sometimes infuriate federal judges and the Justice Department. During the 1990s, the U.S. Treasury paid $31.6 million in legal fees for environmental cases filed against the government."

The Capital Research Center also found that environmental fundraising groups have robbed the American taxpayers. For instance, a review of the Natural Resources Defense Council's (NRDC) financial and court records reveal that "a large percentage of its cases against the government agencies eventually are thrown out of court." These lawsuits drain the resources of the federal agencies and rob the taxpayer at the same time. Taxpayers bear the court costs when the government is sued and if the organization wins, the groups are rewarded financial judgments and court costs-all paid for by the taxpayer. And to add insult to injury, many of these organizations operate on taxpayer-funded grants to begin with.

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