September 9, 2016

Strong intervention rules help mitigate harms of "sue and settle" litigation

By Caleb R. Trotter Attorney

In 2014, a lightning strike ignited a wildfire injohnsonbarsign the Johnson Bar Campground in Idaho’s Nez Perce National Forest. As a result of the fire, a substantial amount of dead and dying timber–a dangerous source of fuel for future wildfires–remains in the forest. To remove the danger and recover the value of the timber, the United States Forest Service proposed a project to auction off timber sales contracts. Before the contracts were auctioned off, however, two groups of environmentalists sued the Forest Service in an attempt to halt the project.

Shortly after the lawsuit was filed, two companies–Idaho Forest Group, LLC, and R & R Conner Aviation, LLC–won the contracts. When the two timber companies moved to intervene in the lawsuit to defend their contracts, the federal district court in Idaho denied their motion. The court held that even though contracts are protectable interests for the purposes of intervention, since the companies were aware of the ongoing lawsuit, their knowledge of the suit precluded their right to intervene. Further, the court held that the Forest Service would adequately represent their interests. The timber companies subsequently appealed, and today, PLF filed a brief in the Ninth Circuit Court of Appeals in support of the timber companies’ right to intervene.

PLF’s brief focuses on three reasons why the timber companies should be allowed to intervene in the suit. First, even though this case isn’t a classic example of “sue and settle” litigation, the lower court’s decision exacerbates the harms that result from sue and settle—environmental advocacy groups are able to circumvent the democratic process and undermine the Administrative Procedure Act. Instead, the intervention rules should be applied liberally to avoid such undesirable outcomes. Here, a liberal application would give the timber companies the opportunity, before legally binding rules are implemented that further burden the timber companies and the public, to present a more complete picture to the lower court of the effects of the environmentalists’ suit.

Second, the district court improperly downplayed the significance of the timber companies’ contract rights by overemphasizing their knowledge of the environmentalists’ ongoing lawsuit when they acquired their rights. In so doing, the district court failed to acknowledge that, regardless of the timber companies’ knowledge of the suit, that suit still would have a direct and substantial effect on their contract rights.

Third, the district court erroneously held that the Forest Service adequately represents the timber companies. The district court incorrectly equated the timber companies’ specific objective in performing the contract with the Forest Service’s general objective in completing the project.

Highlighting the necessity of intervention in environmental cases like these, shortly after the timber companies’ motion to intervene was denied, the district court granted the environmentalists’ request for a preliminary injunction. Rather than appeal the injunction, however, the Forest Service voluntarily agreed to cancel the project–and the timber companies’ contracts–and start the process over in a manner that appeases the environmentalists. If the timber companies are allowed to intervene, they will appeal the injunction and seek to protect and enforce their contracts. In the meantime, the burned timber in Idaho continues to rot.

You can read more about the problems with sue and settle litigation in the full brief, and why this case–and liberal application of the intervention rules–has important implications for preventing further abuse of that practice.

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