[House Report 113-230]
[From the U.S. Government Publishing Office]
113th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 113-230
======================================================================
SUNSHINE FOR REGULATORY DECREES AND SETTLEMENTS ACT OF 2013
_______
September 26, 2013.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Goodlatte, from the Committee on the Judiciary, submitted the
following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 1493]
[Including cost estimate of the Congressional Budget Office]
The Committee on the Judiciary, to whom was referred the
bill (H.R. 1493) to impose certain limitations on consent
decrees and settlement agreements by agencies that require the
agencies to take regulatory action in accordance with the terms
thereof, and for other purposes, having considered the same,
report favorably thereon without amendment and recommend that
the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for the Legislation.......................... 2
Hearings......................................................... 8
Committee Consideration.......................................... 8
Committee Votes.................................................. 8
Committee Oversight Findings..................................... 14
New Budget Authority and Tax Expenditures........................ 15
Congressional Budget Office Cost Estimate........................ 15
Duplication of Federal Programs.................................. 16
Disclosure of Directed Rule Makings.............................. 16
Performance Goals and Objectives................................. 16
Advisory on Earmarks............................................. 17
Section-by-Section Analysis...................................... 17
Dissenting Views................................................. 21
Purpose and Summary
H.R. 1493, the ``Sunshine for Regulatory Decrees and
Settlements Act of 2013,'' limits the ability of defendant
Federal regulators and pro-regulatory plaintiffs to abuse
Federal consent decrees and settlement agreements to require
new regulations, reorder regulatory priorities, bind the
discretion of future administrations, and limit the rights of
regulated entities and State, local and Tribal co-regulators
affected by actions taken under such decrees and settlements.
The bill accomplishes this by improving transparency,
increasing participation by affected regulated entities and co-
regulators in the negotiation and consideration of decrees and
settlements, strengthening public comment on and judicial
review of proposed decrees and settlements, and assuring review
by the Attorney General and agency heads of the types of
proposed decrees and settlements that would most intrusively
involve the Judiciary in the administration of agencies'
regulatory duties.
Background and Need for the Legislation
I. ABUSE OF REGULATORY CONSENT DECREES AND SETTLEMENT AGREEMENTS AND
THE RISE OF ``SUE-AND-SETTLE'' LITIGATION
Since the 1960's and 1970's, consent decrees and settlement
agreements increasingly have been used in Federal litigation to
bind executive discretion under judicial authority, including
to bind executive discretion over successive administrations.
This trend has arisen in litigation against both Federal
defendants and State and local defendants. In litigation
against Federal defendants, the problem has been concentrated
in litigation against regulatory agencies over allegations that
agency action has been unlawfully withheld or unreasonably
delayed at the Federal level.
In such cases, the tactical use of consent decrees and
settlement agreements has, over the decades, essentially been
refined into an art form, commonly known as ``sue-and-settle''
litigation. In sue-and-settle litigation, defendant regulatory
agencies, such as the U.S. Environmental Protection Agency,
typically have failed to meet mandatory statutory deadlines for
new regulations or allegedly have unreasonably delayed
discretionary action. Plaintiffs in such matters often have
strong cases on liability, giving them substantial leverage
over the defending agencies. That leverage is heightened when,
as often is the case, the agency actions at issue are
politically sensitive, such as major, new anti-pollution
regulations to impose high costs on regulated industry.
Political and practical concerns in sue-and-settle cases
frequently give rise to perverse agency incentives to cooperate
with actual or threatened litigation and negotiate a consent
decree or settlement agreement to resolve it. This is because,
once a decree or agreement is in place, the defendant agency
has a litigation-based excuse to expedite action that helps to
diminish political costs, reorder agency funding priorities, or
serve other pro-regulatory ends.
As a result of these factors, it has become common in these
cases for pro-regulatory plaintiffs to approach vulnerable
Federal agencies with threats of lawsuits, negotiate consent
decrees or settlement agreements in secret in advance of suit,
and propose the decrees or settlements to the courts
contemporaneously with the filing of the plaintiffs'
complaints. The resulting decrees and settlement agreements
often come as surprises to the regulated community, State,
local and Tribal regulators who share responsibility for
regulatory programs at issue, and the general public. Further,
these decrees and settlements often provide short timelines for
agency action, particularly the proposal and promulgation of
new regulations. The lack of advance notice and judicially-
backed, minimal timeframes for proposal and promulgation allow
defendant agencies to undercut the public participation and
analytical requirements of the Administrative Procedure Act,
the Regulatory Flexibility Act, the Unfunded Mandates Reform
Act, and other regulatory process statutes. Similarly,
accelerated timeframes for proposal and promulgation allow
agencies to short-circuit review of new regulations by OIRA
under executive orders applicable to the rulemaking process.
Incentives for agencies to pursue these ends--which leave the
agencies freer to frame new regulations to fit pre-conceived
agency preferences, rather than public preferences, sound
policy and the facts--is particularly strong when plaintiffs
and defendant agencies agree on what the content of proposed
and final agency action should be, and seek to effectuate that
agreement without interference by other interested parties and
OIRA.
In many cases, agencies also may not be able to conclude
desired but controversial rulemakings before a succeeding
administration--with potentially different views and
priorities--takes office. The approaching expiration of an
administration's term in office gives agency officials a
powerful incentive to control the incoming administration's
regulatory agenda through consent decrees and settlement
agreements finalized before the new administration can assume
its duties. That is particularly true when agencies have failed
to meet a number of mandatory rulemaking deadlines under one
statute. A current example of that potential was offered by the
set of rulemakings required under the Dodd-Frank Wall Street
Reform and Consumer Protection Act. Estimates in 2012 were that
relevant agencies had missed three-quarters of the pre-2012
rulemaking deadlines in that legislation.\1\ Had the Obama
administration been voted out of office in November 2012, a
high potential for Dodd-Frank sue-and-settle decrees and
settlements would have existed.
---------------------------------------------------------------------------
\1\Reuters, ``Regulators Inching Forward on Dodd-Frank Rules''
(Jan. 3, 2012) (available at http://news.yahoo.com/regulators-inching-
forward-dodd-frank-rules-210003595.html).
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When pro-regulatory interest groups and regulatory agencies
engage in sue-and-settle practices, the end result is
rulemaking that implements the priorities of pro-regulatory
advocates, limits the discretion of succeeding administrations,
and takes place under schedules that render notice-and-comment
rulemaking a formality, depriving regulated entities, the
public and OIRA of sufficient opportunities to influence the
content of final rules.
II. SUE-AND-SETTLE TRENDS UNDER THE OBAMA ADMINISTRATION
Under the Obama administration, this phenomenon has become
particularly troubling. Not only has the Administration
generally increased the number of major rulemakings, but it has
engaged in a flurry of sue-and-settle cases. According to a
recent study of Clean Air Act and Clean Water Act sue-and-
settle cases, the U.S. Chamber of Commerce found that:
LThe sue-and-settle process is increasingly
being used as a technique to shape agencies' regulatory
agendas, without input from the public or the regulated
community.
LThe Obama administration has entered into
more than 70 sue-and-settle agreements which have led
to the issuance of at least 100 regulations, including
the Utility MACT rule, the Chesapeake Bay Clean Water
Act rules, and various regional haze implementation
rules.
LThe Sierra Club was responsible for 34 of the
71 lawsuits, with WildEarth Guardians coming in second
with 20 suits.
LSix of the Obama administration's sue-and-
settle regulations alone reportedly would impose $101
billion in estimated annual costs, while another four
would impose compliance costs of as much as $23.66
billion.
LIn fiscal year 2011, Congress appropriated
$20.9 million to the U.S. Fish and Wildlife Service for
endangered species listing and critical habitat
designation. That year, the agency spent $15.8 million
in response to court orders or settlement
agreements.\2\
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\2\U.S. Chamber of Commerce, ``Sue-and-Settle--Regulating Behind
Closed Doors'' (May 20, 2013) (available at http://www.uschamber.com/
sites/default/files/reports/SUEANDSETTLE
REPORT-Final.pdf).
To provide further examples of sue-and-settle trends, just
two agencies, EPA and the Department of the Interior, have been
able to institute the following major policy changes under sue-
---------------------------------------------------------------------------
and-settle rulemakings during the Obama administration:
Lthe Utility Maximum Achievable Control
Technology rule on coal-fired electric utilities;
Lthe Cement Maximum Achievable Control
Technology rule on cement manufacturing;
Lthe Stream Buffer Zone rule on coal mining;
Lthe Cooling Water Intake Structure
regulations on electric utilities;
Lrevisions to the definition of solid waste
under the Resource Conservation and Recovery Act;
Lregulation of greenhouse gases under the
Clean Water Act;
Lnumeric nutrient criteria for the State of
Florida under the Clean Water Act;
LFederal implementation plans for regional
haze in North Dakota and Oklahoma under the Clean Air
Act;
Lreconsideration of National Ambient Air
Quality Standards for ozone;
LNew Source Performance, Maximum Achievable
Control Technology and residual risk standards for oil
and gas drilling operations;
Lfirst-ever greenhouse gas New Source
Performance Standards for coal- and oil-fired electric
utilities;
Lfirst-ever greenhouse gas New Source
Performance Standards for oil refiners; and
La commitment to move forward with Endangered
Species Act protections for over 250 candidate species.
III. HISTORY OF ADMINISTRATIVE REFORMS IN PAST ADMINISTRATIONS
During the Reagan and George H.W. Bush administrations,
sue-and-settle problems were alleviated under policy set by
Attorney General Meese in 1986. Under this policy, set forth in
a memorandum commonly known as the ``Meese Memo,'' the
Department of Justice generally refused to enter into consent
decrees that:
Lconverted into a mandatory duty the otherwise
discretionary authority of an agency to propose,
promulgate, revise or amend regulations;
Lcommitted the agency to expend funds that
Congress had not appropriated and that had not been
budgeted for the action in question, or committed an
agency to seek a particular appropriation or budget
authorization;
Ldivested the agency of discretion committed
to it by Congress or the Constitution whether such
discretionary power was granted to respond to changing
circumstances, to make policy or managerial choices, or
to protect the rights of third parties; or
Lotherwise afforded relief that the court
could not enter on its own authority upon a final
judgment in the litigation.
The Meese Memo also generally prevented the Department from
entering into settlement agreements that:
Linterfered with the agency's authority to
revise, amend or promulgate regulations through the
procedures set forth in the Administrative Procedure
Act or other statutes prescribing rulemaking procedures
for rulemakings that were the subject of the settlement
agreement;
Lcommitted the agency to expend funds that
Congress had not appropriated and that had not been
budgeted for the action in question; or
Lprovided a remedy for the agency's failure to
comply with the terms of the settlement agreement other
than the revival of the suit resolved by the agreement,
if the agreement committed the agency to exercise its
discretion in a particular way and such discretionary
power was committed to the agency by Congress or the
Constitution to respond to changing circumstances, to
make policy or managerial choices, or to protect the
rights of third parties.\3\
---------------------------------------------------------------------------
\3\Memorandum from Attorney General Edwin Meese III to all
Assistant Attorneys General and United States Attorneys, Department
Policy regarding Consent Decrees and Settlement Agreements (Mar. 13,
1986).
The Meese Memo was grounded in separation-of-powers
concerns. The Clinton administration reviewed the questions
addressed by the Memo and found that these policy concerns were
sound. It did not, however, conclude that the Department was
legally bound to respect the lines drawn in the Memo, and it
substantially relaxed the Department's policy in 1999.\4\
---------------------------------------------------------------------------
\4\Memorandum from Randolph D. Moss, Acting Assistant Attorney
General for Office of Legal Policy, to Associate Attorney General
Raymond C. Fisher, Authority of the United State to Enter Settlements
Limiting the Future Exercise of Executive Branch Discretion (June 15,
1999).
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IV. RESOLUTION OF THE ENVIRONMENTAL COUNCIL OF THE STATES ON SUE-AND-
SETTLE PRACTICES
In light of the impacts that sue-and-settle consent decrees
and settlement agreements often have on State agencies that co-
regulate with the Federal Government (e.g., under the Clean Air
Act), the Environmental Council for the States (ECOS) recently
undertook a review of the concerns raised by sue-and-settle
practices.\5\ This review culminated in ECOS Resolution 13-2,
effective March 6, 2013. The resolution emphasized that States
may be adversely affected by consent decrees or settlement
agreements in sue-and-settle cases, may have information that
would help the Federal Government defend or settle sue-and-
settle cases, and may have interests that should be accounted
for in the consideration of settlements in these cases. It also
stressed that States are not always given notice of such suits,
are often not parties to them, and are typically not afforded
an opportunity to assist in the negotiation of relevant
settlements. In light of these concerns, in Resolution
13-2, ECOS stated that it:
---------------------------------------------------------------------------
\5\As described on its website, ``[t]he Environmental Council of
the States (ECOS) is the national non-profit, non-partisan association
of state and territorial environmental agency leaders. ECOS was
established in December 1993 at a meeting of approximately 20 states in
Phoenix, Arizona and is a 501(c)(6) non-profit organization.'' See
http://www.ecos.org/section/_aboutecos. ``The purpose of ECOS is to
improve the capability of state environmental agencies and their
leaders to protect and improve human health and the environment of the
United States of America.'' Id. ECOS' membership currently includes 48
States, plus the District of Columbia and Commonwealth of Puerto Rico.
L``Affirms that states have stand alone rights
and responsibilities under Federal environmental laws,
and that the state environmental agencies are co-
---------------------------------------------------------------------------
regulators, co-funders and partners with U.S. EPA;''
L``Urges the U.S. EPA to devote the resources
necessary to perform its nondiscretionary duties within
the timeframes specified under Federal law, especially
when required to take action on a state submission made
under an independent right or responsibility (e.g.,
State Implementation Plans under the Clean Air Act).''
L``Specifically calls on U.S. EPA to notify
all affected state environmental agencies of citizen
suits filed against U.S. EPA that allege a failure of
the Federal agency to perform its nondiscretionary
duties;''
L``Believes that providing an opportunity for
state environmental agencies to participate in the
negotiation of citizen suit settlement agreements will
often be necessary to protect the states' role in
implementing Federal environmental programs and for the
administration of authorized or delegated environmental
programs in the most effective and efficient manner;''
L``Specifically calls on U.S. EPA to support
the intervention of state environmental agencies in
citizen suits and meaningful participation in the
negotiation of citizen suit settlement agreements when
the state agency has either made a submission to EPA
related to the citizen suit or when the state agency
either implements, or is likely to implement, the
authorized or delegated environmental program at
issue;''
L``Believes that no settlement agreement
should extend any power to U.S. EPA that it does not
have in current law;''
L``Believes that greater transparency of
citizen suit settlement agreements is needed for the
public to understand the impact of these agreements on
the administration of environmental programs;''
L``Affirms the need for the Federal Government
to publish for public review all settlement agreements
and consider public comments on any proposed settlement
agreements;'' and,
L``Encourages EPA to respond in writing to all
public comments received on proposed citizen suit
settlement agreements, including consent decrees.''\6\
---------------------------------------------------------------------------
\6\The full, official text of Resolution 13-2 is available at
http://www.ecos.org/section/policy/resolution and http://
dl.dropboxusercontent.com/u/8005220/Resolutions/Resolution%2013-2%20
Consent%20Decrees.pdf.
V. REFORMS EMBODIED IN THE ``SUNSHINE FOR REGULATORY DECREES AND
SETTLEMENTS ACT OF 2013''
Consistent with the record compiled by the Committee, the
measures in H.R. 1493 include provisions that: (1) require
notices of intent to sue, complaints, consent decrees and
settlement agreements, and attorneys' fee agreements in
lawsuits attempting to force regulatory action be more
transparent to the public and regulated entities; (2) give to
regulated entities, State, local and Tribal co-regulators, and
the public more rights to participate in the shaping or
judicial evaluation of sue-and-settle consent decrees and
settlement agreements, whether through notice-and-comment
procedures or rights to participate in litigation as
intervenors or amici curiae; (3) provide courts with more
complete records and tools to review proposed sue-and-settle
consent decrees and settlement agreements; and, (4) codify key
Meese Memo's restrictions to constrain the authority of the
Department of Justice and defendant agencies to agree to sue-
and-settle consent decrees and settlements that present
separation-of-powers concerns.
VI. PROCEEDINGS ON THE SUNSHINE FOR REGULATORY DECREES AND SETTLEMENTS
ACT IN THE 112TH CONGRESS
During the 112th Congress, the Subcommittee on Courts,
Commercial and Administrative Law held a hearing on H.R. 1493's
predecessor legislation, H.R. 3862. Testimony was received from
Roger R. Martella, Jr., Sidley Austin LLP, former general
counsel of the U.S. Environmental Protection Agency; Professor
David Schoenbrod, New York Law School; Andrew M. Grossman, the
Heritage Foundation; and John C. Cruden, president of the
Environmental Law Institute and former Deputy Assistant
Attorney General for the Department of Justice's Environment
and Natural Resources Division, with additional material
submitted by the Natural Resources Defense Council, the
American Bar Association, and Kenny, Kenneth and Paula Cieplik.
The Committee on the Judiciary reported H.R. 3862 favorably to
the House, and the bill passed the House on July 26, 2012, as
title V of H.R. 4078, the ``Red Tape Reduction and Small
Business Job Creation Act of 2012,'' on a bipartisan vote (245-
172).
Hearings
The Committee's Subcommittee on Regulatory, Commercial and
Antitrust Law held 1 day of hearings on H.R. 1493, on June 5,
2013. Testimony was received from Commissioner Tom Easterly,
Indiana Department of Environmental Management, on behalf of
the State of Indiana and the Environmental Council of the
States, William L. Kovacs, Senior Vice President for
Environment, Technology & Regulatory Affairs, U.S. Chamber of
Commerce, Allen Puckett, Columbus Brick Co., Columbus
Mississippi, and John Walke, Director, Climate and Air Quality
Program, Natural Resources Defense Council, with additional
material submitted by the Attorney General for the State of
Georgia, the Associated Builders and Contractors, Inc., the
American Sheep Industry Association, the Association of
National Grasslands, the National Cattlemen's Beef Association,
and the Public Lands Council.
Committee Consideration
On July 10, 2013, the Subcommittee on Regulatory Reform,
Commercial and Antitrust Law met in open session and ordered
the bill H.R. 1493 favorably reported, without amendment, by
voice vote, a quorum being present. On July 24, 2013, the
Committee met in open session and ordered the bill H.R. 1493
favorably reported without amendment, by a rollcall vote of 17
to 12, a quorum being present.
Committee Votes
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
following rollcall votes occurred during the Committee's
consideration of H.R. 1493.
1. The amendment offered by Mr. Conyers exempts from
requirements of H.R. 1493 consent decrees and settlement
agreements that pertain ``to the protection of the privacy of
Americans.'' The amendment was defeated by a rollcall vote of
12-16.
ROLLCALL NO. 1
------------------------------------------------------------------------
Ayes Nays Present
------------------------------------------------------------------------
Mr. Goodlatte (VA), Chairman................... X
Mr. Sensenbrenner, Jr. (WI).................... X
Mr. Coble (NC).................................
Mr. Smith (TX)................................. X
Mr. Chabot (OH)................................
Mr. Bachus (AL)................................ X
Mr. Issa (CA)..................................
Mr. Forbes (VA)................................
Mr. King (IA).................................. X
Mr. Franks (AZ)................................ X
Mr. Gohmert (TX)............................... X
Mr. Jordan (OH)................................
Mr. Poe (TX)................................... X
Mr. Chaffetz (UT).............................. X
Mr. Marino (PA)................................ X
Mr. Gowdy (SC)................................. X
Mr. Amodei (NV)................................ X
Mr. Labrador (ID)..............................
Ms. Farenthold (TX)............................ X
Mr. Holding (NC)...............................
Mr. Collins (GA)............................... X
Mr. DeSantis (FL).............................. X
Mr. Smith (MO)................................. X
Mr. Conyers, Jr. (MI), Ranking Member.......... X
Mr. Nadler (NY)................................ X
Mr. Scott (VA)................................. X
Mr. Watt (NC).................................. X
Ms. Lofgren (CA)............................... X
Ms. Jackson Lee (TX)...........................
Mr. Cohen (TN)................................. X
Mr. Johnson (GA)............................... X
Mr. Pierluisi (PR).............................
Ms. Chu (CA)................................... X
Mr. Deutch (FL)................................ X
Mr. Gutierrez (IL).............................
Ms. Bass (CA).................................. X
Mr. Richmond (LA)..............................
Ms. DelBene (WA)............................... X
Mr. Garcia (FL)................................
Mr. Jeffries (NY).............................. X
------------------------
Total...................................... 12 16
------------------------------------------------------------------------
2. The amendment offered by Mr. Cohen exempts from
requirements of H.R. 1493 consent decrees and settlement
agreements ``that prevents or is intended to prevent
discrimination on the basis of race, religion, national origin,
or any other protected category.'' The amendment was defeated
by a rollcall vote of 13-16.
ROLLCALL NO. 2
------------------------------------------------------------------------
Ayes Nays Present
------------------------------------------------------------------------
Mr. Goodlatte (VA), Chairman................... X
Mr. Sensenbrenner, Jr. (WI)....................
Mr. Coble (NC).................................
Mr. Smith (TX)................................. X
Mr. Chabot (OH)................................ X
Mr. Bachus (AL)................................ X
Mr. Issa (CA).................................. X
Mr. Forbes (VA)................................ X
Mr. King (IA).................................. X
Mr. Franks (AZ)................................ X
Mr. Gohmert (TX)...............................
Mr. Jordan (OH)................................
Mr. Poe (TX)...................................
Mr. Chaffetz (UT).............................. X
Mr. Marino (PA)................................ X
Mr. Gowdy (SC)................................. X
Mr. Amodei (NV)................................
Mr. Labrador (ID).............................. X
Ms. Farenthold (TX)............................ X
Mr. Holding (NC)............................... X
Mr. Collins (GA)............................... X
Mr. DeSantis (FL).............................. X
Mr. Smith (MO)................................. X
Mr. Conyers, Jr. (MI), Ranking Member.......... X
Mr. Nadler (NY)................................
Mr. Scott (VA)................................. X
Mr. Watt (NC).................................. X
Ms. Lofgren (CA)............................... X
Ms. Jackson Lee (TX)........................... X
Mr. Cohen (TN)................................. X
Mr. Johnson (GA)............................... X
Mr. Pierluisi (PR).............................
Ms. Chu (CA)................................... X
Mr. Deutch (FL)................................
Mr. Gutierrez (IL).............................
Ms. Bass (CA).................................. X
Mr. Richmond (LA)..............................
Ms. DelBene (WA)............................... X
Mr. Garcia (FL)................................ X
Mr. Jeffries (NY).............................. X
------------------------
Total...................................... 13 16
------------------------------------------------------------------------
3. The amendment offered by Ms. Jackson Lee exempts from
requirements of H.R. 1493 consent decrees and settlement
agreements that pertain ``to a reduction in illness or death
from exposure to toxic substances or hazardous waste in
communities that are protected by Executive Order 12898.'' The
amendment was defeated by a rollcall vote of 9-17.
ROLLCALL NO. 3
------------------------------------------------------------------------
Ayes Nays Present
------------------------------------------------------------------------
Mr. Goodlatte (VA), Chairman................... X
Mr. Sensenbrenner, Jr. (WI)....................
Mr. Coble (NC).................................
Mr. Smith (TX)................................. X
Mr. Chabot (OH)................................ X
Mr. Bachus (AL)................................ X
Mr. Issa (CA)..................................
Mr. Forbes (VA)................................ X
Mr. King (IA).................................. X
Mr. Franks (AZ)................................ X
Mr. Gohmert (TX)............................... X
Mr. Jordan (OH)................................ X
Mr. Poe (TX)...................................
Mr. Chaffetz (UT).............................. X
Mr. Marino (PA)................................ X
Mr. Gowdy (SC)................................. X
Mr. Amodei (NV)................................
Mr. Labrador (ID).............................. X
Ms. Farenthold (TX)............................
Mr. Holding (NC)............................... X
Mr. Collins (GA)............................... X
Mr. DeSantis (FL).............................. X
Mr. Smith (MO)................................. X
Mr. Conyers, Jr. (MI), Ranking Member.......... X
Mr. Nadler (NY)................................
Mr. Scott (VA)................................. X
Mr. Watt (NC).................................. X
Ms. Lofgren (CA)...............................
Ms. Jackson Lee (TX)........................... X
Mr. Cohen (TN)................................. X
Mr. Johnson (GA)............................... X
Mr. Pierluisi (PR).............................
Ms. Chu (CA)...................................
Mr. Deutch (FL)................................
Mr. Gutierrez (IL).............................
Ms. Bass (CA)..................................
Mr. Richmond (LA)..............................
Ms. DelBene (WA)............................... X
Mr. Garcia (FL)................................ X
Mr. Jeffries (NY).............................. X
------------------------
Total...................................... 9 17
------------------------------------------------------------------------
4. The amendment offered by Mr. Watt strikes from the bill
provisions that establish a rebuttable presumption that a
regulated party's interests are not adequately represented by
the parties in a covered civil action or a civil action in
which a covered consent decree or settlement agreement has been
proposed. The amendment was defeated by a rollcall vote of 11-
17.
ROLLCALL NO. 4
------------------------------------------------------------------------
Ayes Nays Present
------------------------------------------------------------------------
Mr. Goodlatte (VA), Chairman................... X
Mr. Sensenbrenner, Jr. (WI)....................
Mr. Coble (NC).................................
Mr. Smith (TX)................................. X
Mr. Chabot (OH)................................ X
Mr. Bachus (AL)................................ X
Mr. Issa (CA)..................................
Mr. Forbes (VA)................................ X
Mr. King (IA).................................. X
Mr. Franks (AZ)................................ X
Mr. Gohmert (TX)............................... X
Mr. Jordan (OH)................................ X
Mr. Poe (TX)...................................
Mr. Chaffetz (UT)..............................
Mr. Marino (PA)................................ X
Mr. Gowdy (SC)................................. X
Mr. Amodei (NV)................................
Mr. Labrador (ID).............................. X
Ms. Farenthold (TX)............................ X
Mr. Holding (NC)............................... X
Mr. Collins (GA)............................... X
Mr. DeSantis (FL).............................. X
Mr. Smith (MO)................................. X
Mr. Conyers, Jr. (MI), Ranking Member.......... X
Mr. Nadler (NY)................................
Mr. Scott (VA)................................. X
Mr. Watt (NC).................................. X
Ms. Lofgren (CA)...............................
Ms. Jackson Lee (TX)...........................
Mr. Cohen (TN)................................. X
Mr. Johnson (GA)............................... X
Mr. Pierluisi (PR)............................. X
Ms. Chu (CA)................................... X
Mr. Deutch (FL)................................
Mr. Gutierrez (IL).............................
Ms. Bass (CA).................................. X
Mr. Richmond (LA)..............................
Ms. DelBene (WA)............................... X
Mr. Garcia (FL)................................ X
Mr. Jeffries (NY).............................. X
------------------------
Total...................................... 11 17
------------------------------------------------------------------------
5. The amendment offered by Mr. Johnson exempts from
requirements of H.R. 1493 consent decrees and settlement
agreements ``that the Director of the Office of Management and
Budget determines would result in net job creation.'' The
amendment was defeated by a rollcall vote of 11-17.
ROLLCALL NO. 5
------------------------------------------------------------------------
Ayes Nays Present
------------------------------------------------------------------------
Mr. Goodlatte (VA), Chairman................... X
Mr. Sensenbrenner, Jr. (WI)....................
Mr. Coble (NC).................................
Mr. Smith (TX)................................. X
Mr. Chabot (OH)................................ X
Mr. Bachus (AL)................................ X
Mr. Issa (CA)..................................
Mr. Forbes (VA)................................ X
Mr. King (IA).................................. X
Mr. Franks (AZ)................................ X
Mr. Gohmert (TX)............................... X
Mr. Jordan (OH)................................ X
Mr. Poe (TX)...................................
Mr. Chaffetz (UT)..............................
Mr. Marino (PA)................................ X
Mr. Gowdy (SC)................................. X
Mr. Amodei (NV)................................
Mr. Labrador (ID).............................. X
Ms. Farenthold (TX)............................ X
Mr. Holding (NC)............................... X
Mr. Collins (GA)............................... X
Mr. DeSantis (FL).............................. X
Mr. Smith (MO)................................. X
Mr. Conyers, Jr. (MI), Ranking Member.......... X
Mr. Nadler (NY)................................
Mr. Scott (VA)................................. X
Mr. Watt (NC).................................. X
Ms. Lofgren (CA)...............................
Ms. Jackson Lee (TX)........................... X
Mr. Cohen (TN)................................. X
Mr. Johnson (GA)............................... X
Mr. Pierluisi (PR)............................. X
Ms. Chu (CA)................................... X
Mr. Deutch (FL)................................
Mr. Gutierrez (IL).............................
Ms. Bass (CA)..................................
Mr. Richmond (LA)..............................
Ms. DelBene (WA)............................... X
Mr. Garcia (FL)................................ X
Mr. Jeffries (NY).............................. X
------------------------
Total...................................... 11 17
------------------------------------------------------------------------
6. The bill was reported by a rollcall vote of 17-12.
ROLLCALL NO. 6
------------------------------------------------------------------------
Ayes Nays Present
------------------------------------------------------------------------
Mr. Goodlatte (VA), Chairman................... X
Mr. Sensenbrenner, Jr. (WI)....................
Mr. Coble (NC).................................
Mr. Smith (TX)................................. X
Mr. Chabot (OH)................................ X
Mr. Bachus (AL)................................ X
Mr. Issa (CA)..................................
Mr. Forbes (VA)................................ X
Mr. King (IA).................................. X
Mr. Franks (AZ)................................ X
Mr. Gohmert (TX)............................... X
Mr. Jordan (OH)................................ X
Mr. Poe (TX)...................................
Mr. Chaffetz (UT)..............................
Mr. Marino (PA)................................ X
Mr. Gowdy (SC)................................. X
Mr. Amodei (NV)................................
Mr. Labrador (ID).............................. X
Ms. Farenthold (TX)............................ X
Mr. Holding (NC)............................... X
Mr. Collins (GA)............................... X
Mr. DeSantis (FL).............................. X
Mr. Smith (MO)................................. X
Mr. Conyers, Jr. (MI), Ranking Member.......... X
Mr. Nadler (NY)................................
Mr. Scott (VA)................................. X
Mr. Watt (NC)..................................
Ms. Lofgren (CA)............................... X
Ms. Jackson Lee (TX)........................... X
Mr. Cohen (TN)................................. X
Mr. Johnson (GA)............................... X
Mr. Pierluisi (PR)............................. X
Ms. Chu (CA)................................... X
Mr. Deutch (FL)................................ X
Mr. Gutierrez (IL).............................
Ms. Bass (CA)..................................
Mr. Richmond (LA)..............................
Ms. DelBene (WA)............................... X
Mr. Garcia (FL)................................ X
Mr. Jeffries (NY).............................. X
------------------------
Total...................................... 17 12
------------------------------------------------------------------------
Committee Oversight Findings
In compliance with clause 3(c)(1) of rule XIII of the Rules
of the House of Representatives, the Committee advises that the
findings and recommendations of the Committee, based on
oversight activities under clause 2(b)(1) of rule X of the
Rules of the House of Representatives, are incorporated in the
descriptive portions of this report.
New Budget Authority and Tax Expenditures
Clause 3(c)(2) of rule XIII of the Rules of the House of
Representatives is inapplicable because this legislation does
not provide new budgetary authority or increased tax
expenditures.
Congressional Budget Office Cost Estimate
In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, the Committee sets forth, with
respect to the bill, H.R. 1493, the following estimate and
comparison prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act of
1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, September 20, 2013.
Hon. Bob Goodlatte, Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1493, the
``Sunshine for Regulatory Decrees and Settlements Act of
2013.''
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Martin von
Gnechten, who can be reached at 226-2860.
Sincerely,
Douglas W. Elmendorf,
Director.
Enclosure
cc:
Honorable John Conyers, Jr.
Ranking Member
H.R. 1493--Sunshine for Regulatory Decrees and Settlements Act of 2013.
As ordered reported by the House Committee on the Judiciary
on September 20, 2013.
H.R. 1493 would modify the process used to develop consent
decrees and settlement agreements that require Federal agencies
to take specified regulatory actions. Under the bill,
complaints against Federal agencies, the terms of the consent
decree or settlement agreement, and the award of attorneys'
fees would need to be published and accessible to the public in
an electronic format. The legislation would require that any
proposed consent decree or settlement agreement be published in
the Federal Register for 60 days for public comment prior to
filing with the court. H.R. 1493 also would require that
settlement negotiations be conducted through mediation or
alternative dispute resolution programs.
Under the bill, agencies that submit certain consent
decrees or settlement agreements to the court would be required
to inform the court of the agency's other outstanding mandatory
duties under current law and explain how the proposed consent
decree or settlement agreement would further the public
interest. The legislation would require the Attorney General
(for cases litigated by the Department of Justice) or the head
of a Federal agency that independently litigates a case to
certify to the court his or her approval of certain types of
settlement agreements and consent decrees. Finally, H.R. 1493
also would require courts to more closely review consent
decrees when agencies seek to modify them.
Based on information provided by the Department of Justice
and assuming the appropriation of the necessary funds, CBO
estimates that implementing H.R. 1493 would cost $7 million
over the 2014-2018 period, primarily because litigation
involving consent decrees and settlement agreements would
probably take longer and agencies would face additional
administrative requirements, including new requirements to
report more information to the public.
Enacting H.R. 1493 could affect direct spending; therefore,
pay-as-you-go procedures apply. Under the Clean Air Act, the
Clean Water Act, and other statutes, successful plaintiffs are
entitled to repayment of attorneys' fees through the Treasury's
Judgment Fund. Such payments have averaged about $2 million
annually in recent years. By lengthening the process of
developing consent decrees, H.R. 1493 could increase the amount
of reimbursable attorneys' fees, thus increasing the amount of
such payments from the Judgment Fund. However, the increased
length of the process to finalize consent decrees and
settlement agreements might deter some future lawsuits and
decrease the number of future cases. On net, CBO estimates that
enacting the legislation would increase annual direct spending
by an insignificant amount. Enacting the bill would not affect
revenues.
H.R. 1493 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would impose no costs on state, local, or tribal governments.
The CBO staff contact for this estimate is Martin von
Gnechten. The estimate was approved by Theresa Gullo, Deputy
Assistant Director for Budget Analysis.
Duplication of Federal Programs
No provision of H.R. 1493 establishes or reauthorizes a
program of the Federal Government known to be duplicative of
another Federal program, a program that was included in any
report from the Government Accountability Office to Congress
pursuant to section 21 of Public Law 111-139, or a program
related to a program identified in the most recent Catalog of
Federal Domestic Assistance.
Disclosure of Directed Rule Makings
The Committee estimates that H.R. 1493 specifically directs
to be completed no specific rule makings within the meaning of
5 U.S.C. 551.
Performance Goals and Objectives
The Committee states that pursuant to clause 3(c)(4) of
rule XIII of the Rules of the House of Representatives, H.R.
1493 limits the ability of defendant Federal regulators and
pro-regulatory plaintiffs to abuse Federal consent decrees and
settlement agreements to require new regulations, reorder
regulatory priorities, bind the discretion of future
administrations, and limit the rights of regulated entities and
State, local and Tribal co-regulators affected by actions taken
under such decrees and settlements.
Advisory on Earmarks
In accordance with clause 9 of rule XXI of the Rules of the
House of Representatives, H.R. 1493 does not contain any
congressional earmarks, limited tax benefits, or limited tariff
benefits as defined in clause 9(e), 9(f), or 9(g) of Rule XXI.
Section-by-Section Analysis
The following discussion describes the bill as reported by
the Committee.
Sec. 1. Short Title.
Section 1 sets forth the short title of the bill as the
``Sunshine for Regulatory Decrees and Settlements Act of
2013.''
Sec. 2. Definitions.
Under the definitions in Section 2, the bill applies to
specific classes of consent decrees and settlements, as
follows:
Subsec. 2(1): ``Agency'' and ``Agency action'' have the
meanings given those terms under 5 U.S.C. Sec. 551.
Subsec. 2(2): ``Covered civil action'' means a civil
action brought under chapter 7 of title 5, United States Code,
or any other statute authorizing suit against the United
States, to compel agency action alleged to be unlawfully
withheld or unreasonably delayed that pertains to a regulatory
action that affects the rights of private parties other than
the plaintiff or the rights of state, local or tribal
governments.
Subsec. 2(3): ``Covered consent decree'' means any consent
decree entered in a covered civil action and any consent decree
that requires agency action that pertains to a regulatory
action that affects the rights of private parties other than
the plaintiff or the rights of state, local or tribal
governments.
Subsec. 2(4): ``Covered consent decree or settlement
agreement'' means a covered consent decree and a covered
settlement agreement.
Subsec. 2(5): ``Covered settlement agreement'' means any
settlement agreement entered in a covered civil action and any
settlement agreement that requires agency action that pertains
to a regulatory action that affects the rights of private
parties other than the plaintiff or the rights of state, local
or tribal governments.
Sec. 3. Consent Decree and Settlement Reform.
Section 3 of the bill sets forth the following requirements
applicable to consent decrees and settlement agreements covered
by the bill:
Subsec. 3(a)(1)--notice of intent to sue and complaints in
covered civil actions must be made publicly available, within
15 days after receipt of service of the notice of intent to sue
or the complaint, respectively, through readily accessible
means, including electronic means by the agency against which
the action is filed.
Subsec. 3(a)(2)--the opportunity for affected parties to
intervene in the litigation must conclude before covered
consent decrees and settlement agreements may be proposed to
the court.
Subsec. 3(b)(1)--in considering motions to intervene, the
court must adopt a rebuttable presumption that an intervenor-
movant's rights are not adequately represented by the plaintiff
or defendant agency.
Subsec. 3(b)(2)--in considering motions to intervene, the
court must take due account of whether the movant is a state,
local or tribal government that co-administers with the Federal
Government the statutory provisions at issue in the litigation
or administers state, local or tribal regulatory authority that
would be preempted by the defendant agency's discharge of the
regulatory duty alleged in the complaint.
Subsec. 3(c)(1)-(2)--if the court grants intervention, it
must include the plaintiff, defendant agency and intervenor(s)
in court-supervised settlement talks. Settlement negotiations
are to occur in the court's mediation or ADR program or to be
presided over by a district judge other than the presiding
judge, a magistrate judge, or a special master, as determined
appropriate by the presiding judge.
Subsec. 3(d)(1)--the defendant agency must publish in the
Federal Register and online any proposed consent decree or
settlement agreement for no fewer than 60 days of public
comment before filing it with the court and must specify the
statutory basis for the covered consent decree or settlement.
The agency must also publish a description of the covered
consent decree or settlement, including whether it provides for
an award of attorney's fees.
Subsec. 3(d)(2)(A)--during the 60 day period, the
defendant agency must allow public comment on any issue related
to the matters alleged in the complaint in the applicable civil
action or addressed or affected by the covered consent decree
or settlement agreement.
Subsec. 3(d)(2)(B)--the defendant agency must respond to
any public comments received.
Subsec. 3(d)(2)(C)--the defendant agency must submit to
the court a summary of the public comments and agency responses
when it moves for entry of the covered consent decree or
dismissal of the case based on the settlement agreement, inform
the court of the statutory basis for the proposed covered
consent decree or settlement, certify an index of the
administrative record for the notice and comment proceeding to
the court, and make the administrative record fully accessible
to the court.
Subsec. 3(d)(2)(D)--the court must include in the record
the index of the administrative record certified by the agency
under subparagraph (C) and any documents listed in the index
which any party or amicus curiae appearing before the court in
the action submits to the court.
Subsec. 3(d)(3)(A)--the defendant agency may, at its
discretion, hold a public agency hearing on whether to enter
into the proposed consent decree or settlement agreement.
Subsec. 3(d)(3)(B)--if such a hearing is held, then a
summary of the proceedings must be filed with the court, the
hearing record must be certified to the court and included in
the judicial record, and full access to the hearing record must
be given to the court.
Subsec. 3(d)(4)--if a proposed consent decree or
settlement agreement requires agency action by a date-certain,
the defendant agency must inform the court of any uncompleted
mandatory agency duties the covered consent decree or
settlement agreement does not address, how the covered consent
decree or settlement agreement would affect the discharge of
those duties, and why the covered consent decree's or
settlement agreement's effects on the order in which the agency
discharges its mandatory duties is in the public interest.
Subsec. 3(e)(1)-(2)--in the case of a covered consent
decree, the Attorney General or, in cases litigated by agencies
with independent litigating authority, the defendant agency
head, must certify to the court that he or she approves of a
proposed covered consent decree that includes terms that: (i)
convert into a non-discretionary duty a discretionary authority
of an agency to propose, promulgate, revise, or amend
regulations; (ii) commit an agency to expend funds that have
not been appropriated and that have not been budgeted for the
regulatory action in question; (iii) commit an agency to seek a
particular appropriation or budget authorization; (iv) divest
an agency of discretion committed to the agency by statute or
the Constitution of the United States, without regard to
whether the discretion was granted to respond to changing
circumstances, to make policy or managerial choices, or to
protect the rights of third parties; or (v) otherwise affords
relief that the court could not enter under its own authority
upon a final judgment in the civil action.
In the case of a covered settlement agreement, the
Attorney General or, in cases litigated by agencies with
independent litigating authority, the defendant agency head,
must certify to the court that he or she approves of a proposed
covered settlement agreement that provides a remedy for failure
by the agency to comply with the terms of the covered
settlement agreement other than the revival of the civil action
resolved by the covered settlement agreement and that: (i)
interferes with the authority of an agency to revise, amend, or
issue rules under the procedures set forth in chapter 5 of
title 5, United States Code, or any other statute or executive
order prescribing rulemaking procedures for a rulemaking that
is the subject of the covered settlement agreement; (ii)
commits the agency to expend funds that have not been
appropriated and that have not been budgeted for the regulatory
action in question; or (iii) for a covered settlement agreement
that commits the agency to exercise in a particular way
discretion which was committed to the agency by statute or the
Constitution of the United States to respond to changing
circumstances, to make policy or managerial choices, or to
protect the rights of third parties.
Subsec. 3(f)(1)--when it considers motions to participate
as amicus curiae in briefing over whether it should enter or
approve a consent decree or settlement, the court must adopt a
rebuttable presumption that favors amicus participation by
those who filed public comments on the covered consent decree
or settlement agreement during the agency's notice and comment
process.
Subsec. 3(f)(2)(A)-(B)--the court must ensure that a
proposed consent decree or settlement agreement allows
sufficient time and procedure for the agency to comply with the
Administrative Procedure Act and other applicable statutes that
govern rulemaking, and, unless contrary to the public interest,
any executive orders that govern rulemaking;
Subsec. 3(g)--requires agencies to submit annual reports
to Congress on the number, identity, and content of covered
civil actions brought against and covered consent decrees and
settlement agreements, including the statutory bases of the
covered consent decrees and settlement agreements, and the
decrees' and settlements' related complaints and attorneys' fee
awards.
Sec. 4. Motions to Modify Consent Decrees.
The bill establishes a de novo standard of review for the
courts' consideration of motions to modify covered consent
decrees and settlement agreements due to agency obligations to
fulfill other duties or changed facts and circumstances.
Sec. 5. Effective Date.
The bill becomes effective upon enactment and applies to
any covered civil action filed or covered consent decree or
settlement agreement proposed to a court on or after that date.
Dissenting Views
INTRODUCTION
H.R. 1493, the ``Sunshine for Regulatory Decrees and
Settlements Act of 2013,'' is yet another attack on the Federal
rulemaking process. Consent decrees and settlements generate
many benefits by facilitating the enforcement of laws, ensuring
judicial efficiency, and protecting the public fisc.
Notwithstanding these benefits, this ill-conceived bill imposes
numerous new procedural burdens on agencies and courts with
respect to the entry of consent decrees and settlement
agreements that seek to compel agency action that involves
regulatory power and affects the rights of non-parties to such
actions. Among these burdens are the requirement that agencies
solicit public comments on such proposed consent decrees or
settlement agreements and respond to each public comment before
entering such agreements in court. The bill would also require
courts to presume, subject to rebuttal, that almost any private
third party be allowed to intervene in litigation between a
public interest group and a Federal agency concerning a
regulatory action and would require that such third party be
permitted to participate in settlement negotiations between the
two litigants.
Without any evidence, proponents of this legislation allege
that it is needed to restrain agencies and interest groups from
colluding to ``sue and settle,'' whereby sympathetic Federal
agencies enter into consent decrees or settlement agreements
with public interest groups or other private citizen plaintiffs
as a form of informal rulemaking that avoids compliance with
the rulemaking procedures outlined in the Administrative
Procedure Act\1\ (APA) and other statutes. Procedures have long
been in place that circumscribe the ability of agencies to
enter consent decrees and settlement agreements so as to avoid
any potential ``sue and settle'' situations. By undermining
citizen attempts to enforce statutory rulemaking duties on
agencies, H.R. 1493 ultimately threatens public health and
safety by undermining the promulgation of new safeguards. Also,
by discouraging the use of consent decrees and settlement
agreements, encouraging costly and protracted litigation over
ambiguous and ill-defined terms, imposing unduly burdensome
procedural requirements on agencies and courts, and providing
increased opportunities for dilatory tactics by those opposed
to the agency action at issue in the underlying litigation,
H.R. 1493 will exponentially increase costs for American
taxpayers. Finally, this bill improperly undermines the
judiciary's traditional role in managing litigation and
resolving disputes equitably and efficiently.
---------------------------------------------------------------------------
\1\5 U.S.C. Sec. Sec. 551-59, 701-06, 1305, 3105, 3344, 5372, 7521
(2013).
---------------------------------------------------------------------------
A broad coalition of civil rights, environmental, consumer
protection, and other public interest groups opposed a
substantially similar bill in the 112th Congress, including the
Alliance for Justice, the American Association for Justice, the
Center for Food Safety, the Center for Science in the Public
Interest, Defenders of Wildlife, Earthjustice, the Natural
Resources Defense Council, OMB Watch (now the Center for
Effective Government), Public Citizen, and the Sierra Club.\2\
Additionally, the Administration threatened to veto H.R. 1493's
predecessor from the 112th Congress, stating that it would
``spawn excessive regulatory litigation, and introduce
redundant processes for litigation settlements.''\3\
---------------------------------------------------------------------------
\2\Letter to Rep. John Conyers, Jr. (D-MI), Ranking Member, H.
Committee on the Judiciary from 41 public interest groups (Mar. 19,
2012) (on file with the H. Committee on the Judiciary, Democratic
Staff).
\3\Executive Office of the President, Office of Management and
Budget, Statement of Administration Policy on H.R. 4078--the Regulatory
Freeze for Jobs Act of 2012 (July 23, 2012), available at http://
www.whitehouse.gov/sites/default/files/omb/legislative/sap/112/
saphr4078r_
20120723.pdf.
---------------------------------------------------------------------------
We likewise strongly oppose H.R. 1493 and respectfully
dissent.
DESCRIPTION AND BACKGROUND
H.R. 1493, the ``Sunshine for Regulatory Decrees and
Settlements Act of 2013,'' is intended to address the perceived
problem of collusion between public interest plaintiffs and
sympathetic Federal agencies in entering into consent decrees
or settlement agreements that oblige the agency to take a
particular action regarding a regulatory action (e.g., a
rulemaking), often under a certain timeline. Proponents of the
bill call this phenomenon ``sue and settle.'' H.R. 1493 would
impose various burdensome procedural requirements on Federal
agencies and Federal courts when a consent decree or settlement
agreement prescribes regulatory action affecting a private
third party. These new procedures include a virtually unlimited
right for almost any private party to intervene in ongoing
litigation and settlement negotiations between a Federal agency
and plaintiffs that have sued it to enforce a statutory
obligation to undertake a regulatory action. The bill also
includes a requirement that agencies accept and respond to
public comments about a proposed consent decree or settlement
agreement. It also limits the kinds of consent decrees and
settlement agreements that executive departments and agencies
may agree to. This legislation is freestanding and does not
amend any current law or statute.
A detailed description of the bills substantive provisions
follows.
Section 2 defines several key terms. Section 2(1) imports
the definitions of ``agency'' and ``agency action'' from the
APA. Thus, the bill's provisions apply to Executive Branch and
independent agencies alike.\4\
---------------------------------------------------------------------------
\4\Independent regulatory agencies, as opposed to executive branch
agencies, are considered ``independent''because the President has
limited authority to remove their leaders, who can only be removed for
cause, rather than simply serving at the President's pleasure. Such
agencies are usually styled ``commissions'' or ``boards'' (e.g.,
National Labor Relations Board, Securities and Exchange Commission).
Stephen G. Breyer, et al., Administrative Law and Regulatory Policy, at
100 (4th ed. 1999).
---------------------------------------------------------------------------
Section 2(2) defines ``covered civil action'' as meaning a
civil action that: (1) seeks to compel agency action; (2)
alleges that an agency is unlawfully withholding or
unreasonably delaying ``agency action relating to a regulatory
action'' that affects the rights of private third parties or
state, local, or tribal governments; and (3) is brought
pursuant to the judicial review provisions of the APA or any
other statute authorizing judicial review of agency action. The
scope of and distinction between ``agency action'' and
``regulatory action'' are not entirely clear, nor is the
meaning of ``rights'' or ``private persons.'' Given that these
are threshold terms, their vagueness is likely to lead to
litigation over whether H.R. 1493's provisions apply to a given
proposed consent decree or settlement agreement.
Section 2(3) defines ``covered consent decree'' as a
consent decree in a covered civil action and any other consent
decree requiring agency action concerning a rulemaking or other
regulatory action that affects private third parties or state,
local, or tribal governments. Thus, H.R. 1493 could apply to
consent decrees in cases that are not ``covered civil actions''
under the bill.
Section 2(4) defines ``covered consent decree or settlement
agreement'' as a covered consent decree and a covered
settlement agreement. This definition's purpose is unclear.
Section 2(5) defines ``covered settlement agreement'' in a
manner similar to the definition for ``covered consent
decree,'' except that it applies to settlement agreements
rather than consent decrees. As with ``covered consent
decrees,'' this means that H.R. 1493 could apply to settlement
agreements in cases that are not ``covered civil actions''
under the bill.
Section 3 of the bill sets forth several new procedures
that agencies and parties in litigation must follow before a
court can enter a consent decree or settlement agreement, as
well as certain rebuttable presumptions that courts must make.
Section 3(a)(1) requires a defendant agency in a covered
civil action to post online a copy of the notice of intent to
sue and the complaint in the covered civil action not later
than 15 days after receiving service of each. Section 3(a)(2)
prohibits a party to a civil action from moving to enter a
covered consent decree or to dismiss a civil action pursuant to
a covered settlement agreement until after compliance with the
bill's notice and comment requirements or after a public
hearing allowed under the bill, whichever is later.
Section 3(b)(1) applies a unique standard for third-party
intervention in covered civil actions. Specifically, it
requires a court, when considering a motion to intervene in a
covered civil action or in a civil action in which a covered
consent decree or settlement agreement is proposed, to presume
that the interests of ``a person who alleges that the agency
action in dispute would affect the person'' would not be
adequately represented by the parties to the action. This
places the burden on the non-moving parties to show that they
can adequately represent the putative intervenor's interests,
in contrast to current law, which places the burden on the
party seeking intervention to demonstrate that its interests
are not adequately represented by the parties per Federal Rule
of Civil Procedure 24.
With respect to motions to intervene by state, local, and
tribal governments, section 3(b)(2) requires a court to ``take
due account of whether the movant'' jointly administers with a
defendant agency the statutory provisions giving rise to the
underlying lawsuit or administers under state, local, or tribal
law an authority that would be preempted by the regulatory
action at issue in the underlying lawsuit.
Section 3(c) outlines certain requirements regarding the
negotiation to settle a covered civil action or to reach an
agreement on a covered consent decree or settlement agreement.
Section 3(c)(1) requires that such negotiations be conducted
pursuant to the court's alternative dispute resolution program
or by a judge other than the presiding judge, a magistrate, or
a special master, as the presiding judge may determine. Such
settlement negotiations must also include any intervening
party.
Section 3(d) imposes a number of notice and comment
procedures on agencies before they can file a consent decree or
settlement agreement with a court. Section 3(d)(1) requires
that an agency publish in the Federal Register and post online
a proposed covered consent decree or settlement agreement and a
description of its terms, including whether it provides for
attorneys' fees or costs and a basis for such award, at least
60 days before such consent decree or settlement agreement is
filed with a court.
Section 3(d)(2)(A) requires that the agency accept public
comment on any issue in the underlying civil action or
regarding the proposed consent decree or settlement agreement
during that minimum 60-day period provided for in section
3(d)(1). Section 3(d)(2)(B) requires the agency to respond to
any public comments. Section 3(d)(2)(C) requires an agency to:
(1) inform the court of the statutory basis for the proposed
consent decree or settlement agreement and a summary of public
comments that it has received; (2) submit to the court a
certified index of the administrative record of the notice and
comment proceeding; and (3) make the administrative record
available to the court. Finally, section 3(d)(2)(D) requires
the court to include in the record of the underlying civil
action the administrative record submitted by an agency, as
well as any documents listed in the index that any party or
amicus curiae appearing before the court submits.
Section 3(d)(3) allows an agency to hold a public hearing
regarding whether to enter into a proposed covered consent
decree or settlement agreement and outlines the procedures for
holding such a hearing.
Section 3(d)(4) requires an agency to present to the court
certain explanations before moving to enter a covered consent
decree or settlement agreement, or to dismiss the civil action
based on the covered consent decree or settlement agreement,
when the agency is required to take an action by a date certain
pursuant to such decree or settlement. The required
explanations must describe: (1) any required regulatory action
that the agency has not taken and that the decree or settlement
does not address; (2) a description of how the decree or
settlement would affect the discharge of such required
regulatory action; and (3) why the effects of the decree or
settlement on the discharge of required regulatory action would
be in the public interest.
Section 3(e) codifies long-standing guidelines that
Department of Justice and agency attorneys follow to ensure
that their use of consent decrees or settlement agreements are
not used to circumvent the normal rulemaking process, known as
the ``Meese Memo'' (which is itself already codified in the
Code of Federal Regulations).\5\ Section 3(e)(1) states the
general rule that for a covered consent decree or settlement
agreement containing certain terms that are proscribed by the
Meese Memo, the Attorney General or the head of an independent
agency (depending on which agency is the litigating party),
must submit to the court a signed certification that he or she
approves the proposed consent decree or settlement agreement.
Section 3(e)(2) sets forth the terms that would subject a
proposed covered decree or settlement to the certification
requirement. For covered consent decrees, these terms are those
that: (1) convert an agency's discretionary rulemaking
authority into a nondiscretionary rulemaking obligation; (2)
commit an agency to expend funds for the regulatory action at
issue that have not been appropriated and budgeted; (3) commit
an agency to seek a particular appropriation or budget
authorization; (4) divest an agency of discretion committed to
it by statute or the Constitution; or (5) affords relief that
the court otherwise would not have authority to grant. For
covered settlement agreements, the terms triggering the
certification requirement are those that: (1) remedy the
agency's failure to comply with the covered settlement
agreement, other than a revival of the underlying civil action;
and (2) interferes with agency rulemaking procedures under the
APA, another statute, or executive order, commits the agency to
expend non-appropriated and non-budgeted funds for the
regulatory action at issue, or commits the agency to exercise
discretion in a particular way when the discretion was
committed to it by statute or the Constitution to respond to
changing circumstances, to make policy or managerial choices,
or to protect the rights of third parties.
---------------------------------------------------------------------------
\5\28 C.F.R. Sec. Sec. 0.160-0.163 (2013).
---------------------------------------------------------------------------
Section 3(f) imposes certain requirements on courts for
judicial consideration of proposed covered consent decrees and
settlement agreements. Section 3(f)(1) requires a court
reviewing a proposed covered consent decree or settlement
agreement to presumptively allow amicus participation by any
party who filed public comments or participated in a public
hearing regarding such proposed decree or settlement under the
bill. Section 3(f)(2) prohibits a court from entering a consent
decree unless it provides for sufficient time or procedures for
the agency to comply with the APA's rulemaking procedures or
other statutes and executive orders that govern rulemaking. The
court must also ``ensure'' that such provisions are contained
in any proposed settlement agreement.
Section 3(g) requires agencies to submit annual reports to
Congress. These reports must include the number, ``identity,''
and content of covered civil actions brought against the agency
as well as covered consent decrees or settlement agreements
that the agency has entered into. Additionally, the report must
describe the statutory basis for each covered consent decree or
settlement agreement entered into by the agency and for any
award of attorneys' fees or costs in the underlying civil
action.
Section 4 of the bill specifies that when an agency moves
to modify a covered consent decree or settlement agreement
because it is no longer ``fully in the public interest due to
the obligations of the agency to fulfill other duties or due to
changed facts and circumstances,'' the court must review the
decree or settlement de novo.
Section 5 states that the bill's provisions apply to
covered civil actions pending on the bill's enactment date.
Section 5 further provides that the bill's provisions apply to
all covered consent decrees and covered settlement agreements
proposed on or after the bill's enactment date.
CONCERNS WITH H.R. 1493
I. H.R. 1493 is a Solution in Search of a Problem
No reliable evidence supports the assertion that H.R. 1493
is needed. Federal agencies do not collude with public interest
organizations and other private-citizen plaintiffs in entering
into consent decrees or settlements as a way of circumventing
proper rulemaking procedures. Nevertheless, proponents of H.R.
1493 repeatedly contend that such collusion takes place,
without citing evidence in support of that contention. For
example, Roger Martella testified before the Judiciary
Committee's Subcommittee on Courts, Commercial and
Administrative Law in the 112th Congress that ``certain groups
increasingly are employing a `sue and settle' approach to
interactions with the government on regulatory issues.''\6\
According to Mr. Martella, under such arrangements, non-
governmental organizations use consent decrees and settlements
with agencies to dictate agency priorities and set timelines
for rulemakings without transparency, opportunity for input
from the to-be-regulated entities, or opportunity for judicial
review of such agreements.\7\ At this year's hearing on H.R.
1493, the bill's proponents cited a faulty U.S. Chamber of
Commerce study to support their bald assertions of
collusion.\8\
---------------------------------------------------------------------------
\6\The Federal Consent Decree Fairness Act and the Sunshine for
Regulatory Decrees and Settlements Act: Hearings on H.R. 3041 and H.R.
3862 Before the Subcomm. on Courts, Commercial and Administrative Law
of the H. Comm. on the Judiciary, 112th Cong. (2012) [hereinafter
``2012 Hearing''] (statement of Roger R. Martella, Jr., Partner, Sidley
Austin LLP).
\7\2012 Hearing at 26-28.
\8\U.S. Chamber of Commerce, Sue and Settle: Regulating Behind
Closed Doors, May 2013, available at http://www.uschamber.com/reports/
sue-and-settle-regulating-behind-closed-doors.
---------------------------------------------------------------------------
The facts, however, are bereft of any evidence of such
collusion. For example, John Walke of the Natural Resources
Defense Council thoroughly de-bunked the Chamber study. Mr.
Walke testified that the Chamber's methodology relied entirely
on ``Internet searches identifying all cases in which [the
Environmental Protection Agency or EPA] and an environmental
group entered into a consent decree or settlement agreement
between 2009 and 2012.''\9\ In doing so, he explained, the
report ignored EPA settlements with industry parties or
conservative groups and did not examine any EPA settlements
during the Bush administration, during which the EPA also
entered into settlements and consent decrees. Mr. Walke further
noted:
---------------------------------------------------------------------------
\9\2013 Hearing at 115.
Most striking of all is that by merely compiling EPA
settlements (with just environmental groups, under just
[the Obama] administration), the report's methodology
quietly dispenses with any need for proof of collusion
or impropriety in consent decrees or settlement
agreements. The Chamber cannot remotely back up the
charge that collusion was involved in all of these
settlements, or even in any of them, so the report does
not even try.\10\
---------------------------------------------------------------------------
\10\Id. at 116.
Mr. Walke observed that the Chamber report simply sought to
transform evidence of the use of a ``common and long-accepted
form of resolving litigation over clear legal violations under
any administration'' into evidence of inappropriate
collusion.\11\ It is also critical to note that, while much of
the justification that H.R. 1493's proponents--including the
Chamber of Commerce--have centered on consent decrees and
settlements involving the EPA, the bill itself is drafted in
general language and would apply to consent decrees and
settlement agreements involving all Federal agencies, not just
the EPA.
---------------------------------------------------------------------------
\11\Id.
---------------------------------------------------------------------------
The testimony of John Cruden, a senior career official in
the Department of Justice (DoJ) Environment and Natural
Resources Division (ENRD) for more than two decades during two
Republican and two Democratic administrations, bolsters Mr.
Walke's conclusion that there is no evidence of ``sue and
settle'' collusion. Mr. Cruden testified on a substantially
similar bill in the 112th Congress that he was unaware of any
instance of this so-called collusive ``sue and settle''
activity occurring during his long tenure as a senior ENRD
official. He also emphasized that agencies enter settlements
only when they have failed to meet mandatory rulemaking
obligations:
In my long experience with the types of cases covered
by [this legislation], EPA only agreed to settle when
the agency had a mandatory duty to take an action, or
to prepare a rule, based on specific legislation
enacted by Congress. The settlement in those cases was
straightforward: setting a date by which the agency
would propose a draft rule and, quite often, a date for
final action. Had there not been such a settlement, a
Federal court would have issued an injunction setting
the date for EPA to take action, since the agency's
legal responsibility was quite clear.
Because a proposed rule emerging from a settlement
would provide the same notice-and-comment opportunities
as any other rulemaking, and because the final rules
still would be subject to challenge under the
Administrative Procedure Act, this existing process
obviously does not avoid public comment, and already
allows interested parties their full range of
substantive and procedural rights.
. . .
I am not aware of any instance of a settlement, and
certainly none I personally approved, that could
remotely be described as ``collusive.'' Quite the
opposite: in every case of which I am aware, the
Department of Justice vigorously represented the
Federal agency, defending the agency's legal position
and obtaining in any settlement the best possible terms
that were consistent with the controlling law.\12\
---------------------------------------------------------------------------
\12\2012 Hearing at 106-107.
Others have also refuted the ``sue and settle'' allegation.
As a Sierra Club representative observed, this theory is a
``sad attempt to create a boogie man out of vital and broadly
supported protections that have improved and saved millions of
Americans' lives.''\13\ Likewise, David Goldston of the Natural
Resources Defense Council testified in 2011 at a House Energy
and Commerce Subcommittee hearing that the ``whole 'sue and
settle' narrative is faulty.''\14\
---------------------------------------------------------------------------
\13\John McCardle, House Republicans Accuse EPA, Enviros of
Collusion, N.Y. Times, July 15, 2011, available at http://
www.nytimes.com/gwire/2011/07/15/15greenwire-house-republicans-accuse-
epa-enviros-of-collus-69925.html
\14\Id
---------------------------------------------------------------------------
Mr. Walke also noted in his testimony that the Chamber
report ultimately identifies as its culprit the citizen-suits
that Congress has authorized under various environmental
statutes.\15\ The entire ``sue and settle'' allegation that
undergirds H.R. 1493, therefore, is really aimed at
congressionally authorized provisions that permit citizens to
sue agencies so as to enforce statutory requirements. If these
citizen-suit provisions are the true cause for concern, then it
is for H.R. 1493's proponents to push for their repeal by
Congress, rather than seek to disrupt the use of longstanding
mechanisms for resolving litigation.
---------------------------------------------------------------------------
\15\2013 Hearing at 116-117.
---------------------------------------------------------------------------
In the absence of genuine evidence that Federal agencies
collude with plaintiffs to circumvent proper rulemaking
procedures by use of consent decrees and settlement agreements,
H.R. 1493 simply addresses a non-existent problem.
II. LBy Undermining Enforcement of Mandatory Rulemaking Duties, H.R.
1493 Threatens Public Health and Safety
To the extent that H.R. 1493 undermines attempts to enforce
statutory mandates on agencies, it potentially undermines
public health and safety. As noted, most consent decrees and
settlement agreements arising from civil actions where a
citizen lawsuit has been filed against an agency stem from the
fact that the agency failed to meet a statutory rulemaking
deadline or other rulemaking duty. Congress assigned these
mandatory duties to agencies because it concluded that a
particular public health or safety concern merited such action
by the agencies. Moreover, Congress added citizen-lawsuit
provisions in these statutes in order to allow private citizens
to help enforce its statutory mandates. Therefore, when
agencies fail to meet such mandatory duties, the harm that they
were supposed to address remains unaddressed. By making it
harder for citizens to compel agencies to meet their duties,
H.R. 1493 jeopardizes public health and safety.
Health and safety concerns are not a mere abstraction.
Regarding the issue of workplace safety alone, there were 4,383
fatal occupational injuries last year, according to the Bureau
of Labor Statistics.\16\ Additionally, an analysis by the
National Institute for Occupational Safety and Health, the
American Cancer Society, and Emory University's School of
Public Health estimates that after factoring in disease and
injury data ``there are a total of 55,200 US deaths annually
resulting from occupational disease or injury (range 32,200-
78,200).''\17\ To the degree that H.R. 1493 makes it harder for
citizens to force agencies to address these kinds of concerns,
it unnecessarily puts the American people at risk.
---------------------------------------------------------------------------
\16\Press Release, U.S. Dep't of Labor Bureau of Labor Statistics,
National Census of Fatal Occupational Census of Fatal Occupational
Injuries in 2012 (Preliminary Results), Aug. 13, 2013, available at
http://www.bls.gov/news.release/pdf/cfoi.pdf.
\17\Kyle Steenland et al., Dying for Work: The Magnitude of US
Mortality from Selected Cases of Death Associated with Occupation, 43
Am. J. Industrial Medicine 461 (2003).
---------------------------------------------------------------------------
III. LH.R. 1493 is Unnecessary in Light of the Justice Department's
``Meese Memo'' and Other Existing Legal Mechanisms
H.R. 1493's proponents have never explained why, to the
extent that collusive settlement agreements are an actual
problem, the so-called ``Meese Memo'' is insufficient to
address such a problem, nor have they offered evidence that the
DoJ and Federal agencies are not complying with its
requirements. Moreover, H.R. 1493's proponents offer no
rationale as to why the Meese Memo needs to be codified in
statute, as this bill does. Finally, in addition to the Meese
Memo, other legal mechanisms exist for addressing the
proponents' purported concerns about transparency and public
input in consent decree and settlement negotiations.
The Meese Memo, codified in the Code of Federal
Regulations,\18\ specifies a process that already addresses the
purported problem sought to be addressed by H.R. 1493's
proponents. In 1986, then-United States Attorney General Edwin
Meese issued a set of guidelines for DoJ and other government
attorneys in entering into consent decrees and settlement
agreements in response to the following concerns:
---------------------------------------------------------------------------
\18\28 C.F.R. Sec. Sec. 0.160-0.163 (2012).
In the past . . . executive departments and agencies
have, on occasion, misused [consent decrees] and
forfeited the prerogatives of the Executive in order to
preempt the exercise of those prerogatives by a
subsequent Administration. These errors sometimes have
resulted in an unwarranted expansion of the powers of
[sic] judiciary--often with the consent of government
parties--at the expense of the executive and
legislative branches.\19\
---------------------------------------------------------------------------
\19\Memorandum from Edwin Meese III, Attorney General, to All
Assistant Attorneys General and All United States Attorneys Regarding
Department Policy Regarding Consent Decrees and Settlement Agreements
(Mar. 13, 1986), available at http://www.archives.gov/news/samuel-
alito/accession-060-89-1/Acc060-89-1-box9-memoAyer-LSWG-1986.pdf.
The Meese Memo identified three types of potentially
problematic provisions in consent decrees: (1) a department or
agency agreed to promulgate regulations and may have
relinquished its power to amend those regulations or promulgate
new ones without court participation; (2) a consent decree may
divest a department or agency of discretion committed to it by
the Constitution or a statute where exercise of discretion is
ultimately subject to court approval; and (3) a department or
agency has agreed to use its best efforts to obtain funding
from Congress in order to enforce the decree.\20\
---------------------------------------------------------------------------
\20\Id.
---------------------------------------------------------------------------
As a result, the Meese Memo states that departments and
agencies should not enter into a consent decree that: (1)
``converts into a mandatory duty the otherwise discretionary
authority of the Secretary or agency administrator to revise,
amend, or promulgate regulations;'' (2) ``commits the
department or agency to expend funds that Congress has not
appropriated and that have not been budgeted for the action in
question, or commits a department or agency to seek a
particular appropriation or budget authorization;'' or (3)
``divests the Secretary or agency administrator, or his
successors, of discretion committed to him by Congress, or the
Constitution where such discretionary power was granted to
respond to changing circumstances, to make policy or managerial
choices, or to protect the rights of third parties.''\21\ The
policy outlines similar restrictions on settlement
agreements.\22\ If special circumstances require departure from
these guidelines, the Attorney General, the Deputy Attorney
General, or the Associate Attorney General must authorize such
a departure.\23\ The Meese Memo ultimately was incorporated
into the Code of Federal Regulations.\24\
---------------------------------------------------------------------------
\21\Id.
\22\Id.
\23\Id.
\24\28 C.F.R. Sec. Sec. 0.160-0.163 (2013).
---------------------------------------------------------------------------
H.R. 1493's proponents offer no evidence that the DoJ and
agencies are not complying with the Meese Memo. As Mr. Cruden
noted, ``I am personally unaware of any examples of the
Department failing to comply with the existing C.F.R. provision
[codifying the Meese Memo]; nor did the other witnesses present
any such examples at the hearing.''\25\ Moreover, the
Majority's witnesses at last year's hearing on H.R. 1493's
predecessor specifically praised the Meese Memo and offered no
argument as to why it was insufficient to address the alleged
``sue and settle'' problem.\26\
---------------------------------------------------------------------------
\25\2012 Hearing at 111.
\26\See id. at 60 (statement of Andrew M. Grossman) (``The Meese
Policy was, and remains, notable for its identification of a serious
breach of separation of powers, with serious consequences, and its
straightforward approach to resolving that problem. By reducing the
issue, and its remedy, to their essentials, the Meese Policy identifies
and protects the core principles at stake. This explains its continued
relevance.'').
---------------------------------------------------------------------------
In addition to the Meese Memo, there are other mechanisms
available that already address the purported concerns of H.R.
1493's proponents. For example, parties whose interests may be
affected by a consent decree or settlement may move to
intervene in the case pursuant to Federal Rule of Civil
Procedure 24, with the moving party bearing the burden of
demonstrating that the parties to the case do not adequately
represent the movant's interest.\27\ Similarly, any rulemaking
that is required pursuant to a consent decree or settlement
agreement would still be subject to the APA's notice and
comment procedures, and affected parties who are not parties to
the consent decree or settlement agreement would still have the
opportunity to weigh in on any negative impacts of a proposed
rule.\28\
---------------------------------------------------------------------------
\27\Fed. R. Civ. P. 24(a)(2).
\28\5 U.S.C. Sec. 553 (2013).
---------------------------------------------------------------------------
In sum, to the extent that the Federal Government is, in
fact, tempted to use consent decrees and settlement agreements
to do an end-run around the rulemaking procedures, the Meese
Memo and other mechanisms already address such concerns, making
H.R. 1493 unnecessary.
IV. H.R. 1493 Will Favor Industry Interests at Taxpayers' Expense
In addition to being unnecessary, H.R. 1493 threatens to
impose tremendous financial costs on taxpayers. It would do so
in several ways. First, it provides numerous new opportunities
for opponents of regulation to engage in dilatory tactics to
delay resolution of pending litigation, further increasing
costs for agencies and courts and, ultimately, taxpayers.
Second, many of its key terms are ambiguous, which will lead to
confusion, litigation, and delay in any proposed consent decree
or settlement negotiation. Third, it imposes numerous
burdensome procedural requirements on agencies and courts when
they are considering consent decrees and settlements concerning
regulatory action, which will further add to the costs borne by
those entities. Fourth, the bill's cumulative effect would be
to discourage agencies from entering into consent decrees and
settlement agreements when they might otherwise have done so,
leading to unnecessarily protracted and costly litigation.
A. LH.R. 1493 opens the door to dilatory tactics by
industry and other opponents of agency action.
Various provisions of H.R. 1493 would give opponents of
regulations opportunities to effectively stifle rulemaking by
allowing them to slow down one of the processes by which
agencies agree to abide by their congressionally-assigned duty
to regulate. As Mr. Walke and Mr. Cruden noted in their
testimony, agencies enter into consent decrees and settlement
agreements when they have a mandatory duty to act, including
the requirement to promulgate a new rule.\29\ By opening
opportunities for industry to slow down this process, H.R. 1493
effectively makes it more expensive for agencies to do what
Congress has mandated it to do.
---------------------------------------------------------------------------
\29\2013 Hearing at 117-118; 2012 Hearing at 106-107.
---------------------------------------------------------------------------
Section 3(b)(1) of the bill, for example, contains a nearly
open-ended intervention right by mandating that a court
presume, subject to rebuttal, that the interests of any private
third party affected by the agency action in dispute in the
underlying litigation will not be represented by the parties to
that litigation.\30\ This presumption upends current law, which
places the burden of proof on a third party to show that its
interests are not represented by the parties in the case.\31\
Effectively, this shift in the burden of proof on the question
of the representation of third-party interests is a way to make
it much easier for any entity not a party to the case to
intervene in a case involving a consent decree or settlement
agreement that seeks to compel agency action.
---------------------------------------------------------------------------
\30\H.R. 1493, 113th Cong. Sec. 3(b)(1) (2013).
\31\Rule 24 of the Federal Rules of Civil Procedure states, in
pertinent part:
(a) Intervention of Right. On timely motion, the court must permit
---------------------------------------------------------------------------
anyone to intervene who:
(1) is given an unconditional right to intervene by a
Federal statute; or
(2) claims an interest relating to the property or
transaction that is the subject of the action, and is so
situated that disposing of the action may as a practical
matter impair or impede the movant's ability to protect its
interest, unless existing parties adequately represent that
interest.
(b) Permissive Intervention.
(1) In General. On timely motion, the court may permit
anyone to intervene who:
(A) is given a conditional right to intervene by a Federal
statute; or
(B) has a claim or defense that shares with the main action
a common question of law or fact.
Hypothetically, under H.R. 1493, if the regulatory action
at issue involved the Clean Air Act, a person who breathes air
would have the right to intervene in a consent decree or
settlement agreement, as would any affected industry entity, or
anyone else in the United States, subject to a refutable
presumption that the parties to the litigation do not
adequately represent the third party's interest. If a court
were to read section 3(b)(1) broadly, this provision could open
the door to almost anyone intervening in a covered civil action
under the bill.
Section 3(c) of H.R. 1493 also tilts the playing field
sharply in favor of industry interests by giving them an
opportunity to slow down agency compliance with Federal law.
Under this provision, courts must delay entry of a consent
decree or settlement agreement by referring settlement
discussions to the court's mediation or alternative dispute
resolution program, or to a district judge, magistrate judge,
or special master.\32\ Such discussions must include the
plaintiff, defendant agency, and any third party
intervenors.\33\ In addition to delaying the settlement
process, this provision would impose costs on plaintiffs and
defendant agencies alike by forcing them to pay mediation and
other dispute resolution costs beyond what they may have had to
pay in the absence of this process.
---------------------------------------------------------------------------
\32\H.R. 1493, 113th Cong. Sec. 3(c) (2013).
\33\Id.
---------------------------------------------------------------------------
H.R. 1493 provides other opportunities for industry to
engage in dilatory tactics in sections 3(d)(1) and 3(d)(2)(A),
which require an agency to publish any proposed consent decree
or settlement agreement and to allow at least 60 days for
public comments.\34\ The agency must then respond to every
comment pursuant to section 3(d)(2)(B).\35\ Under these
provisions, any industry would be able to flood an agency with
comments in an effort to stall resolution of the underlying
dispute, which, as noted, usually concern enforcement of
rulemaking deadlines.
---------------------------------------------------------------------------
\34\Id. at Sec. Sec. 3(d)(1), 3(d)(2)(A).
\35\Id. at Sec. 3(d)(2)(B).
---------------------------------------------------------------------------
As if forcing an agency to respond to potentially numerous
public comments on a proposed consent decree or settlement
agreement was not enough, section 3(f)(1) requires a court to
presume amicus status for any member of the public who submits
comments on a proposed consent decree or settlement agreement,
subject to rebuttal, in any proceeding on a motion to enter
such consent decree or settlement agreement.\36\ This provision
would further allow industry and other regulatory opponents to
delay resolution of the underlying dispute between the
plaintiff and the defendant agency.
---------------------------------------------------------------------------
\36\Id. at Sec. 3(f)(1).
---------------------------------------------------------------------------
B. LH.R. 1493 uses ambiguous language in many key
provisions, opening the door to confusion,
litigation, and delay in resolving disputes.
Many of H.R. 1493's key provisions are written in
ambiguous, ill-defined language, which will foster costly
litigation over their meaning and cause delay in resolving the
underlying lawsuit against the Federal agency. For example,
section 2(2) states that the bill applies to consent decrees
and settlement agreements in an action seeking to compel agency
action and alleging that the agency is ``unlawfully withhodling
or unreasonably delaying agency action relating to a regulatory
action.''\37\ It is unclear what the distinction is between
``agency action'' and ``regulatory action,'' what the scope of
the phrase ``relating to'' is, or what ``unlawfully
withholding'' and ``unreasonably delaying'' mean, opening the
door to litigation over the meaning of these threshold terms.
---------------------------------------------------------------------------
\37\Id. at Sec. 2(2).
---------------------------------------------------------------------------
Additionally, section 2(2) refers to ``private persons''
whose ``rights'' are affected by the regulatory action, but the
bill fails to define what ``private persons'' or ``rights''
means.\38\ As noted above, without a definition, almost any
third party could, in theory, intervene in a consent decree or
settlement discussion under this bill. As with other ambiguous
language in this bill, confusion and a lack of clarity over the
meaning of these terms will lead to litigation.
---------------------------------------------------------------------------
\38\Id.
---------------------------------------------------------------------------
Finally, H.R. 1493's requirement that, under certain
circumstances, agencies must inform the court of all mandatory
rulemaking deadlines and describe how a consent decree or
settlement agreement ``would affect the discharge of those
duties,'' in addition to being open-ended, burdensome, time-
consuming, and a drain on limited agency resources, is also
full of ambiguity.\39\ The requirement, outlined in section
3(d)(4), does not define what ``affect the discharge of those
duties'' means.
---------------------------------------------------------------------------
\39\Id. at Sec. 3(d)(4).
---------------------------------------------------------------------------
C. LH.R. 1493 imposes several burdensome procedural
requirements on agencies and courts with respect to
entering into consent decrees and settlement
agreements.
H.R. 1493 imposes several new procedural requirements on
agencies and courts that are designed to slow down the
resolution of litigation over an agency's failure to meet a
statutory deadline or other regulatory obligation. These
include: (1) a limitation on when a party may file a motion for
a consent decree or to dismiss the case pursuant to a
settlement agreement; (2) a mandate requiring the court to
presume that the interests of a third party seeking to
intervene in settlement discussions is not adequately
represented; (3) a requirement that the court refer consent
decree or settlement discussions to mediation or another
alternative dispute resolution mechanism; (4) a requirement
that the defendant agency publish a proposed consent decree or
settlement agreement; (5) a requirement that agencies accept
public comments on proposed consent decrees or settlements to
which the agency must respond; (6) a requirement that an agency
submit to a court explanations of vaguely defined factors
underlying a proposed consent decree or settlement agreement
whenever such decree or agreement requires agency action by a
date certain; and (7) a requirement that a court allow amicus
participation in any motion to enter a consent decree or
settlement agreement by any party that submitted public
comments on such decree or agreement.
Implementing any one of these new requirements, much less
all of them, drains agency and judicial time and resources
without adding to the fairness of any consent decree or
settlement agreement. In times such as now when Federal
agencies and the court system are facing budgetary shortfalls,
we should be crafting legislation to streamline and improve
efficiencies for all. Unfortunately, H.R. 1493 will have the
opposite result.
D. LThe cumulative effect of H.R. 1493's provisions will be
to discourage the use of consent decrees and
settlement agreements, forcing expensive and time-
consuming litigation.
By facilitating dilatory conduct by anti-regulatory forces,
using vague language in key provisions, and imposing numerous
and burdensome procedural requirements on agencies and courts
with respect to consideration of consent decrees and settlement
agreements, H.R. 1493's cumulative effect will be to discourage
the use of consent decrees and settlement agreements and
thereby delay or eliminate early resolution of litigation
against the government. This legislation will ultimately
increase costs for taxpayers, who must pay for the protracted
litigation associated with fewer consent decrees and settlement
agreements. Indeed, the Congressional Budget Office noted in
its analysis of H.R. 1493 that the bill would impose millions
of dollars in costs, ``primarily because litigation involving
consent decrees and settlement agreements would probably take
longer under the bill and agencies would face additional
administrative burdens, including new requirements to report
more information to the public.''\40\
---------------------------------------------------------------------------
\40\Congressional Budget Office, Cost Estimate for H.R. 1493, the
Sunshine for Regulatory Decrees and Settlements Act of 2013, at 1
(Sept. 20, 2013), available at http://cbo.gov/publication/44606.
---------------------------------------------------------------------------
Consent decrees benefit both plaintiffs and defendants. For
plaintiffs, consent decrees allow for meaningful and timely
relief without the risks and costs associated with prolonged
litigation. Governmental and other defendants can also avoid
the burdens and costs of protracted litigation and the
particular risk that a costly or cumbersome solution simply
will be imposed on them should they lose the suit.
Additionally, defendants can avoid judicial determination of
liability and obtain flexibility in terms of how they implement
needed reforms. This is why the use of consent decrees in
Federal court litigation is a longstanding part of the judicial
and Congressional policy of encouraging alternative dispute
resolution.\41\ H.R. 1493 flies in the face of this policy and
will ultimately cost plaintiffs and governmental defendants
more in litigation costs by making consent decrees and
settlements more difficult to obtain. As John Cruden explained:
---------------------------------------------------------------------------
\41\See Timothy Stoltzfus Jost, Breaking the Deal: Proposed Limits
on Federal Consent Decrees Would Let States Abandon Commitments, Legal
Times, Apr. 25, 2005, at 59 (``Yet the Supreme Court has long
articulated a policy encouraging settlement of cases, as has
Congress.'').
The judicially approved consent decree is a valuable
settlement tool that promotes expeditious resolution of
cases, saves transaction costs for all parties and for
the judicial system, and achieves finality while
protecting the parties to the agreement.
* * *
As compared to full-blown litigation, consent decrees
allow for a faster and less expensive, but still
comprehensive resolution of a dispute. Congress'
underlying statutory objectives are satisfied, while at
the same time, the [defendant] is able to exercise its
sovereignty through the negotiation of binding
contracts and the resolution of potentially onerous
pending litigation. Indeed, the finality and certainty
afforded by the consent decree makes it far easier for
a [defendant] to follow through on its commitments. . .
.\42\
---------------------------------------------------------------------------
\42\2012 Hearing at 108.
By making consent decrees and settlement agreements more
difficult and costly to enter into, H.R. 1493 will ultimately
cost the taxpayer more in litigation costs and, possibly,
expensive judgments.
V. LH.R. 1493 Subverts the Federal Rules of Civil Procedure and
Judicial Discretion
H.R. 1493 overrides the Federal Rules of Civil Procedure,
the courts' power to manage litigation in several respects, and
their authority to consider equities in their decisionmaking.
First, it undermines Federal Rule of Civil Procedure 24, which
sets forth the process for determining when a third party can
intervene in a pending case, placing the burden on the third
party to show that its interests are not adequately represented
by the plaintiff and the defendant. As already discussed, H.R.
1493 overrides this Rule by requiring courts to presume the
opposite, namely that the parties in the litigation do not
adequately represent the interests of the third party.
Second, H.R. 1493 tampers with the process for modifying
consent decrees under Federal Rule of Civil Procedure 60(b)(5).
Under that provision, a court can modify a consent decree when
``the judgment has been satisfied, released, or discharged; it
is based on an earlier judgment that has been reversed or
vacated; or applying it prospectively is no longer
equitable.''\43\ Section 4 of H.R. 1493 attempts to skew the
result of such a motion to modify by specifying that when a
defendant agency moves to modify a previously entered consent
decree, the court ``shall'' review the motion and consent
decree de novo whenever the motion to modify is based on the
grounds that the decree is ``no longer fully in the public
interest due to the agency's obligations to fulfill other
duties or due to changed facts and circumstances.'' This
provision clearly is intended to result in modification or
revocation of an existing consent decree when a government
agency moves to do so, regardless of the equities involved,
which Rule 60 permits a court to consider.
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\43\Fed. R. Civ. P. 60(b)(5).
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Beyond the specific changes that H.R. 1493 makes to the
civil procedure rules at issue, the bill hamstrings a judge's
discretion in managing matters concerning litigation pending
before his or her court. In addition to questions about
intervention or modification of consent decrees, H.R. 1493
repeatedly requires courts to make certain presumptions
(subject to rebuttal) on other similar litigation management
issues such as when to permit amicus participation by third
parties, when to enter a consent decree or settlement
agreement, and when to refer matters to mediation, other
alternative dispute resolution, a special master, or another
judge. In short, H.R. 1493 seeks to dictate courtroom
management issues that have traditionally been left to judges
to decide. Such a lack of deference to courts is a troubling
result for this Committee, in particular, to embrace.
VI. LThe Bill's Open-ended Intervention Provision Could Undo Critical
Civil Rights Protections
Section 3(b)(1) of the bill would create a rebuttable
presumption that the interests of ``a person who alleges that
the agency action in dispute would affect the person . . .
would not be represented adequately by the existing parties to
the action,'' and then require that such party must be included
in ``[e]fforts to settle a covered civil action or otherwise
reach an agreement on a covered consent decrees or settlement
agreement.'' In effect, this rebuttable presumption would
reverse the burden for intervention currently in Rule 24 of the
Federal Rules of Civil Procedure from the party seeking to
intervene in the case to the parties themselves.\44\
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\44\Fed. R. Civ. P. 24.
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During the markup, Members attempted to elicit from the
bill's supporters some clear explanation of the limits of this
right to intervene. Representative Melvin L. Watt (D-NC)
observed, ``This bill has no boundaries around it, from my
perspective. And if we are going to do this, it does seem to me
that we need to put some boundaries around who can be parties.
Otherwise, you have no limits on the litigation or no limits on
the regulatory action.''\45\
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\45\Unofficial Tr. of Markup of H.R. 1493, the Sunshine for
Regulatory Decrees and Settlements Act of 2013, by the H. Comm. on the
Judiciary, 113th Cong. at 37 (July 24, 2013).
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In response to this concern Representative Steve Cohen (D-
TN) offered an amendment that would have excluded from the
coverage of the bill ``a covered consent decree or settlement
agreement that prevents or is intended to prevent
discrimination based on race, religion, national origin, or any
other protected category.'' Subcommittee Chairman Spencer
Bachus (R-AL) recognized to a degree the validity of this
concern and suggested that his Republican colleagues consider
accepting the amendment because, as he explained, ``[e]verybody
in the United States is affected by every consent settlement on
race.''\46\
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\46\Id. at 40.
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Urging his colleagues to reject this amendment, Chairman
Bob Goodlatte (R-VA) contended that current standing
requirements would continue to act as a limit on
intervention.\47\ Standing, however, affords weak limits on the
bill's intervention right. The U.S. Supreme Court's guidance on
this issue appears to have evolved over the years and is one
that it has revisited on numerous occasions.\48\ The Court has
acknowledged that the ``concept of `Art. III standing' has not
been defined with complete consistency in all of the various
cases decided by this Court . . . [and] this very fact is
probably proof that the concept cannot be reduced to a one-
sentence or one-paragraph definition.''\49\ Similarly, the
Court in another case observed that ``[g]eneralizations about
standing to sue are largely worthless as such.''\50\
---------------------------------------------------------------------------
\47\Id. at 46.
\48\See, e.g., Monsanto Co. v. Geerston Seed Farms, 130 S.Ct. 2743
(2010); Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992); Allen v.
Wright, 468 U.S. 737 (1984); Valley Forge Christian College v.
Americans United, 454 U.S. 464 (1982); Ass'n of Data Processing Service
Org. v. Camp, 397 U.S. 150 (1970); Barlow v. Collins, 397 U.S. 159
(1970).
\49\Valley Forge Christian College v. Americans United, 454 U.S.
464, 475 (1982).
\50\Association of Data Processing Service Orgs. v. Camp, 397 U.S.
150, 151 (1970).
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Standing doctrines do not offer bright-line rules regarding
when a party may intervene in a pending case. Resolving
questions about a party's standing will result in extensive
litigation. Therefore, to the extent that H.R. 1493 potentially
further opens the door for any private party to claim the right
to intervene, it would have the effect of delaying any
settlement for years even if the party claiming intervenor
status ultimately is unable to establish proper standing.
VII. Amendments
To highlight the foregoing concerns, several Members
offered amendments illustrating the effect it would have on
rules to protect public health and safety. Most of these
amendments exempted from H.R. 1493 consent decrees and
settlement agreements concerning certain categories of
potential rules.
For example, Representative John Conyers, Jr. (D-MI), the
Committee's Ranking Member, offered an amendment that would
have exempted from the bill any consent decree or settlement
agreement concerning privacy protection. Notwithstanding the
numerous privacy concerns expressed by Members of Congress on
both sides of the aisle in connection with recent revelations
of government surveillance activities, the amendment was
defeated by a 12 to16 vote.
As discussed in the prior section, Representative Steve
Cohen (D-TN), the Subcommittee's Ranking Member, offered an
amendment that would have exempted from the bill any consent
decree or settlement agreement concerning a potential rule
protecting against discrimination on the basis of race, sex,
national origin, or other protected characteristic. Although
the Subcommittee's Chairman made a principled argument in favor
of this amendment, the amendment failed by a vote of 13 to 16.
Representative Sheila Jackson Lee (D-TX) offered an
amendment that would have exempted from the bill any consent
decree or settlement agreement concerning a potential rule
regarding environmental justice in low-income minority
communities as defined by Executive Order 12898. This amendment
failed by a 9 to 17 vote.
Representative Hank Johnson (D-GA) offered an amendment
that would have exempted from the bill any consent decree or
settlement agreement concerning a potential rule that the
Office of Management and Budget determines would result in net
job creation. Belying the repeated assertion by the Majority
that regulations undermine job creation, this amendment failed
by a vote of 11 to 17.
Finally, Representative Mel Watt (D-NC) offered an
amendment that would have stricken the bill's open-ended
intervention provision. This amendment failed by a vote of 11
to 17.
CONCLUSION
Like the myriad anti-regulatory proposals this Committee
has already considered, H.R. 1493 is another solution in search
of a problem. Proponents have failed to present any evidence to
support the claim that agencies ``collude'' with plaintiffs to
enter consent decrees or settlement agreements. Nonetheless,
under the guise of transparency, this legislation will pile on
new procedural requirements for agencies and courts that will
hamstring, or outright discourage, the use of consent decrees
and settlements. As a result, well-funded third party interests
will have more opportunities to delay the resolution of
litigation intended to force agencies to meet their legal
obligations and it will become much harder to resolve such
litigation quickly and cost-effectively. The cumulative effect
will be to derail a time-honored tool that has helped protect
the American public from harms including dirty air and water,
unsafe products, and contaminated food.
There are already procedures in place that could address
any purported collusion or lack of transparency. Procedures
originally implemented during the Reagan administration and
carried forward to this day, along with other existing legal
mechanisms, have been more than adequate to deal with any such
problem. Other than unsupported allegations, however,
proponents of H.R. 1493 have failed to offer a convincing
explanation as to why current law is insufficient in that
regard. Instead, the bill employs ambiguous terms in key
provisions that will actually generate additional litigation
over their meaning, and could be used to undo critical civil
rights protections. Finally, H.R. 1493 undermines existing
civil procedure rules and undermines judicial discretion.
For these reasons, we respectfully dissent and urge our
colleagues to oppose this bill.
John Conyers, Jr.
Jerrold Nadler.
Robert C. ``Bobby'' Scott.
Melvin L. Watt.
Zoe Lofgren.
Sheila Jackson Lee.
Steve Cohen.
Henry C. ``Hank'' Johnson, Jr.
Luis V. Gutierrez.
Karen Bass.
Hakeem Jeffries.