Legislature(2003 - 2004)

04/28/2003 02:10 PM House JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 145 - ATTY FEES: PUBLIC INTEREST LITIGANTS                                                                                 
[Contains mention that a proposed  clarifying amendment to HB 145                                                               
resulted from Senate committee hearings  on SB 97, companion bill                                                               
to HB 145.]                                                                                                                     
Number 0776                                                                                                                     
CHAIR McGUIRE  announced that the  final order of  business would                                                               
be  HOUSE BILL  NO.  145,  "An Act  relating  to public  interest                                                               
litigants  and to  attorney fees;  and amending  Rule 82,  Alaska                                                               
Rules of Civil Procedure."                                                                                                      
Number 0732                                                                                                                     
CRAIG   TILLERY,   Assistant  Attorney   General,   Environmental                                                               
Section,  Civil Division  (Anchorage), Department  of Law  (DOL),                                                               
said that  HB 145 is a  bill related to public  interest litigant                                                               
[attorney]  fees.   He offered  that  currently, public  interest                                                               
litigants are entitled to full attorney  fees if they win a case;                                                               
are  entitled to  "no fees  against them"  if they  lose a  case;                                                               
receive full  fees if they  win one issue  out of many  that they                                                               
may allege;  and may be entitled  to fees in some  cases, even if                                                               
they don't win at all but  it is viewed that the government later                                                               
changed its actions  partially in response to the  lawsuit.  This                                                               
law is  not in  a rule  of the  court, he  noted, but  rather was                                                               
developed  by the  Alaska Supreme  Court  through case  law.   It                                                               
applies to civil actions and to administrative appeals.                                                                         
MR. TILLERY relayed that during  the last legislative session, SB
183 was proposed, and it applied  to [Civil Rule 82 of the Alaska                                                               
Rules of Civil  Procedure], and would have  eliminated the public                                                               
interest litigant  rule in  all cases; SB  183 passed  the Senate                                                               
but not the  House.  HB 145  is different in that it  is far more                                                               
limited.   It  applies only  to  decisions by  the Department  of                                                               
Environmental  Conservation  (DEC),  the  Department  of  Natural                                                               
Resources  (DNR), and  the  Alaska Department  of  Fish and  Game                                                               
(ADF&G) that  are coastal consistency determinations,  that adopt                                                               
regulation, or  that have had  an opportunity for  public comment                                                               
and administrative review.                                                                                                      
MR.  TILLERY  said  that  under HB  145,  in  the  aforementioned                                                               
circumstances,  public interest  litigants would  be treated  the                                                               
same  as any  other  litigant.   He  reasoned  that  each of  the                                                               
aforementioned  situations  represents  "something  where  public                                                               
participation  has  already  been  paid  for  and  where  there's                                                               
already  been extensive  public participation  on the  decision."                                                               
He  mentioned  that  members should  have  a  proposed  amendment                                                               
before them  that reflects some  clarifications that came  out of                                                               
hearings in the Senate on the companion bill to HB 145 - SB 97;                                                                 
this proposed amendment read [original punctuation provided]:                                                                   
     Page 1, line 1, following "fees", through line 2:                                                                        
          Delete "; and amending Rule 82, Alaska Rules of                                                                     
     Civil Procedure"                                                                                                         
     Page 1, line 11, following "action":                                                                                   
          Insert "or an appeal from an administrative                                                                       
     Page 1,  line 13,  following "Resources",  through line                                                                
          Delete     "making    a     coastal    consistency                                                                
     determination, adopting"                                                                                               
          Insert "through which one or more of those                                                                        
     agencies makes  a coastal consistency  determination or                                                                
     Page 2, line 3, following "litigant" through line 5:                                                                   
          Delete "as provided in Rule 82(g), Alaska Rules                                                                   
     of Civil Procedure, on the effective date of this Act"                                                                 
          Insert "in the same manner as attorney's fees may                                                                 
     be  awarded   to  or  against  a   non-public  interest                                                                
     Page 2, line 6, through page 3, line 2:                                                                                    
          Delete all material and insert new bill section                                                                       
     to read:                                                                                                                   
      "* Sec.  2.  AS 09.60.010  is amended by adding  a new                                                                  
     subsection to read:                                                                                                        
               (b) In this section, "public interest                                                                            
     litigant"  means a  party bringing  a  civil action  or                                                                    
     appeal that                                                                                                                
                    (1) is designed to effectuate strong                                                                        
     public policies;                                                                                                           
                    (2) will benefit numerous people;                                                                           
                    (3) could only be expected to be                                                                            
     brought by a private party; and                                                                                            
                    (4) the party bringing the civil action                                                                     
     or appeal  would lack sufficient economic  incentive to                                                                    
     bring  if   it  did  not  involve   issues  of  general                                                                    
      * Sec. 3.   The uncodified law of the  State of Alaska                                                                  
     is amended by adding a new section to read:                                                                                
         APPLICABILITY.  This Act applies to all civil                                                                          
      actions and appeals filed on or after the effective                                                                       
     date of this Act."                                                                                                         
MR. TILLERY  explained that this  proposed amendment  is intended                                                               
to do  three things.  First,  it clarifies that the  bill applies                                                               
to both civil actions and  to administrative appeals.  The reason                                                               
for  this is  because  many instances  in  which public  interest                                                               
litigant [attorney] fees are  awarded are administrative appeals.                                                               
Second,  it clarifies  that  HB  145 only  applies  to the  three                                                               
aforementioned types  of decisions by  the DEC, the DNR,  and the                                                               
ADF&G.   Third, the  proposed amendment  would delete  a proposed                                                               
change  to Civil  Rule 82(b),  thus allowing  the legislation  to                                                               
proceed simply  as a  change in  statute rather  as a  court rule                                                               
Number 0512                                                                                                                     
MR. TILLERY offered that the purpose  of HB 145 is to balance the                                                               
incentives  in  litigation  between  those  who  attack  a  state                                                               
resource  agency   decision  and  those  who   would  defend  it.                                                               
Changing  the  law  would force  all  potential  public  interest                                                               
litigants to  make the essential  cost/benefit analysis  that all                                                               
other potential litigants do prior  to filing a lawsuit, that is,                                                               
does the  benefit gained by going  to court outweigh the  risk of                                                               
loss and  the transaction costs  of going  to court.   Since most                                                               
public  interest  litigants  and  public  interest  organizations                                                               
involved in natural resource issues  are fairly well financed, he                                                               
opined, they  can engage effectively  in this  "calculus" without                                                               
any disadvantage.                                                                                                               
MR. TILLERY  noted that there  are firms,  both in Alaska  and in                                                               
other states,  that deal  with public  interest issues,  and that                                                               
most public interest lawsuits end  up being against the state and                                                               
are  costly  to  defend.     The  state's  fiscal  situation,  he                                                               
remarked,  could lead  the specter  of potential  fees playing  a                                                               
role in decisions  made by the state.  "Public  interest fees are                                                               
also available against private individuals,  which may or may not                                                               
be affected  by the potential  for such fees, depending  upon the                                                               
size of  the project and  the size of  the entity that  wishes to                                                               
engage in a project," he stated.                                                                                                
MR. TILLERY  also offered that HB  145 is intended to  reduce the                                                               
incentive to  assert excessive, unjustified  claims, that  is, to                                                               
reduce the  potential incentive for  parties to file  claims with                                                               
multiple  - even  a hundred  - various  causes of  action in  the                                                               
hopes that some of them will  later be proven justified and then,                                                               
under  the  "doctrine  of  non-apportionment,"  the  parties  can                                                               
recover  attorney  fees.   "It  also  should  make it  easier  to                                                               
compromise cases,  as frequently  these public  interest litigant                                                               
cases will  become 'mooted  out,' will  somehow become  no longer                                                               
relevant, but we still end up  in fights in the supreme court ...                                                               
[relating to attorney] fees only," he added.                                                                                    
Number 0368                                                                                                                     
MR.  TILLERY  said  that philosophically,  the  approach  of  the                                                               
administration is  that HB 145  is very  narrowly drawn.   In the                                                               
last 11 years,  only 23 of the  43 fee orders that  the state has                                                               
had to pay  were from natural resource  cases, representing about                                                               
$760,000 in awards.  The  bill and [the proposed amendment] would                                                               
not  penalize litigation  or restrict  lawsuits,  he assured  the                                                               
committee; instead, all it does  is reduce the positive incentive                                                               
that the  [Alaska] Supreme Court  has introduced into  [the issue                                                               
of] attorney fees.                                                                                                              
MR. TILLERY opined  that the bill provides a  level playing field                                                               
for  all parties,  and only  includes situations  where there  is                                                               
already  extensive state-funded  public involvement,  those being                                                               
coastal consistency  determinations; regulations, where  there is                                                               
public  notice, public  comment, and  -  often but  not always  -                                                               
hearings; and decisions which have  had an opportunity for public                                                               
comment  and administrative  review.   He  assured the  committee                                                               
that the courts  would remain free, under the rules,  to vary fee                                                               
awards for reasons such as  the complexity of the litigation, but                                                               
not simply  for the reason  that the  party is a  public interest                                                               
CHAIR McGUIRE announced that HB 145 would be held over.                                                                         

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