Should 'Substitute' Private Attorneys General Enforce Public Environmental Actions? Balancing the Costs and Benefits of the Contingency Fee Environmental Special Counsel Arrangement

Abstract:     
There is developing phenomenon of quasi-privatized environmental enforcement occurring on behalf and in the name of governments by entrepreneurial attorneys who substitute in place of the public enforcers and derive professional payment from a contingent fee withdrawn from the public’s environmental damage award. This Article addresses the question of whether governments should permit private attorneys to handle these “substitute environmental special counsel” enforcement arrangements. In so doing, the Article weighs the arrangement’s costs and benefits from the standpoint of whether it maximizes the deterrence and restorative compensation goals of environmental enforcement.

Governments are often the only entities with standing to sue on behalf of the public for environmental injury to public resources. In instances where governments lack the resources or choose not to enforce, there exists an enforcement gap not currently filled by any structural mechanism. Citizen suits are an incomplete gap filler because of the Article III standing hurdle, initial up-front litigation funding requirement and the fact that citizen suit provisions only exist for certain types of enforcement claims. Substitute environmental special counselor enforcement provides standing derivative of the standing, permits quasi-privatized enforcement for claims not currently permitted under citizen suit statutes, and contemplates a fee premium to incentivize the privatized funding. Because the arrangement helps fill an unacceptable gap in the enforcement scheme, the costs of arrangement are outweighed by the benefits.

Certain costs, however, are particularly acute when using substitute environmental special counselors, including the tendency to monetize the damage award when equitable restorative remedy might better serve the public’s environmental interest, the difficult to implement monitoring of the substitute enforcer, and the lack of transparency. The Article suggests an attorney fee shifting approach on top of the damage award in place of a contingency fee drawn from the damage award compensation structure, an open and competitive bidding requirement, a preference for government-led enforcement where feasible, and adequate controls on the monitoring process, to temper some of the arrangement’s costs.

Number of Pages in PDF File: 33

Keywords: contingency fee, environmental special counsel

Accepted Paper Series