South Carolina Environmental Law Project

Lawyers for the Wild Side of South Carolina

'Loser Pays' bill introduced, addresses lawsuits against infrastructure projects
February 23rd, 2017

By Abbey O' Brien

U.S. Congressman Tom Rice, who represents South Carolina’s 7th district, reintroduced legislation that aims to cut down on lawsuits that delay infrastructure projects.

The bill, which Rice calls the “Loser Pays” bill, would amend the Clean Water Act and would streamline the permitting process for infrastructure projects.

“It’s so hard to get an infrastructure project built anymore,” said Rice. “It takes years and years and years to get to a permit.”

Rice used the example of environmental groups filing several lawsuits and appeals over the paving of International Drive.

“What we want to do is just make sure that everybody carefully considers before they file a lawsuit to hold up a project like that that they have a real legitimate claim and a real chance at winning,” he added.

Rice said there are several years and levels of review for these types of projects through elected officials, the Army Corp of Engineers and the Environmental Protection Agency.

“After all that’s done and after all those years of review in determining whether or not the property’s feasible, then at the very end, just before the permit is issued, anybody can come along and, for a few hundred dollars, file a lawsuit that would hold up a billion dollar project for years,” said Rice.

The bill says if someone files a lawsuit that holds up a project, like International Drive, and they lose they have to pay court costs and attorney fees.

“It gives everybody a little bit of skin in the game,” added Rice.

International Drive is a smaller, local project but Rice said this bill could protect larger projects like I-73.

“I fully expect the conservation groups to come in just before the permit is issued and file their lawsuits,” said Rice about the I-73 project.

Staff with the South Carolina Environmental Law Project (SCELP) said the bill discourages parties from settling lawsuits amicably and takes away states rights.

Staff Attorney with SCELP, Amelia Thompson, released a statement that said in part: ”

“In South Carolina, we have a specific state statute sanctioning frivolous lawsuits. This bill does nothing to change those laws. Therefore, it does not discourage frivolous lawsuits. It discourages the public from challenging government action that destroys the environment…”

Rice said he wants to protect the environment, but this bill is about accountability and responsibility.

“That’s all we’re asking,” said Rice. “If they file a lawsuit, they need to have a really good chance to win and if they don’t then they bare some of the cost.”

Here is the full statement from the South Carolina Environmental Law Project:

"The amendments that Senator Rice proposes would not get rid of the layers of red tape. His amendments would, however, discourage parties from settling lawsuits amicably, take away court discretion in resolving claims for the costs of litigation, cause more divisive litigation, prevent parties from protecting natural resources even when they both want to do so, and allow discharges of pollution into municipal water supplies, fishing areas, shellfish beds, wildlife areas and recreation areas to go unchallenged due to its draconian provisions.

Reading the bill, in conjunction with the existing law, elucidates the real danger of this proposal: its chilling effect on citizens’ rights to challenge their government’s decisions. The proposed amendment to 33 USC 1365(d) is to change the current statute providing that a court “may” award costs to mandating that the court “shall” award costs to the prevailing party. This mandate for costs would likely have the impact of discouraging settlement and resolution of cases.

The divisive purpose is blatantly confirmed in his next section, titled “Restriction of Certain Settlements.” That part prevents the parties from being able to settle a case even if both sides are in agreement, if mitigation is in excess of the bare formulaic requirements. This is taking away the ability of consenting parties to decide how they want to settle disputes, and making lawsuits more of a zero-sum game in environmental cases. Furthermore, it discourages permittees from being good stewards and offsetting their environmental harm with meaningful protections for wetlands, water quality and wildlife habitats. It is also noteworthy that the bill would allow a permittee to provide less environmental protections that currently required by law: the parties are free to settle for less environmental protections.

The bill repeals the ability to protect against discharge of pollution into many areas, including municipal water supplies, by deleting 33 USC 1344(c). This provision is perhaps the most environmentally irresponsible, and is certainly dangerous to human health because it exposes drinking water to contamination, in addition to fisheries, shellfish beds, and a number of other areas.

Finally, this bill takes away states’ rights. The design of the Clean Water Act has always been to set bare minimum requirements that must be met, and to allow states to be more protective of the environment if they so choose. Section 4 of the bill takes away states’ rights to protect land and water within their jurisdiction, eviscerating “home rule.”

Frivolous lawsuits are already barred by law in every state and there are serious repercussions for attorneys that file them. In South Carolina, we have a specific state statute sanctioning frivolous lawsuits. This bill does nothing to change those laws. Therefore, it does not discourage frivolous lawsuits. It discourages the public from challenging government action that destroys the environment and makes it easier to contaminate drinking water."

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