Legislature(2003 - 2004)

04/07/2003 03:31 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
           SB 97-ATTY FEES: PUBLIC INTEREST LITIGANTS                                                                       
                                                                                                                                
VICE-CHAIR WAGONER told members  that a committee substitute (CS)                                                               
for  SB 97,  labeled  Version D,  had been  prepared  that is  no                                                               
longer specific  to natural resource related  litigation. He said                                                               
he plans to move this bill  to the Senate Judiciary Committee and                                                               
asked participants to limit their testimony to 2 or 3 minutes.                                                                  
                                                                                                                                
SENATOR SEEKINS moved to adopt Version  D of SB 97 as the working                                                               
document of the committee.                                                                                                      
                                                                                                                                
SENATOR  ELTON  objected  for  the   purpose  of  hearing  public                                                               
testimony.                                                                                                                      
                                                                                                                                
VICE-CHAIR WAGONER took public testimony.                                                                                       
                                                                                                                                
MR. AL  SUNDQUIST spoke in opposition  to SB 97. He  told members                                                               
that laws  of questionable  constitutionality must  be challenged                                                               
in the  public interest. Public interest  litigation provides the                                                               
most  effective way  to  defend  Alaskan's constitutional  rights                                                               
against encroachments by state or  local governments. SB 97 would                                                               
jeopardize  the  ability  of   individuals  to  hold  legislators                                                               
accountable for  misjudgments or  misconduct. He  asked committee                                                               
members to reject SB 97.                                                                                                        
                                                                                                                                
MS. JANEL WRIGHT,  legal director for the  Disability Law Center,                                                               
stated opposition to SB 97  for the following reasons. The public                                                               
interest  litigant   rule  protects   the  public's   ability  to                                                               
challenge  state decisions  on matters  of broad  public interest                                                               
without  the financial  hardship of  paying the  state's attorney                                                               
fees if  that litigation is  unsuccessful. SB 97  eliminates this                                                               
protection by  prohibiting courts from taking  into consideration                                                               
the public  interest nature of  a case when the  court determines                                                               
whether to award attorney's fees  to the prevailing party. A very                                                               
important  component of  the Disability  Law Center's  ability to                                                               
advocate  on behalf  of Alaskans  with disabilities  is judicious                                                               
pursuit  of state  court  remedies.  Eliminating public  interest                                                               
litigant  status will  effectively eliminate  the opportunity  of                                                               
individuals with  disabilities to  access the judicial  branch of                                                               
their government to enforce their rights.                                                                                       
                                                                                                                                
MS. WRIGHT  pointed out that  individuals with  disabilities have                                                               
the highest  unemployment rate nationwide  and, as a  group, have                                                               
the highest number living in  poverty. If faced with the prospect                                                               
of liability  for the defense  attorney's fees,  individuals with                                                               
disabilities  will  be unable  to  protect  their rights  in  the                                                               
court.  The public  interest litigant  exception does  not foster                                                               
frivolous lawsuits.  The Alaska Supreme Court  has clearly stated                                                               
that  anyone  bringing  a  frivolous  lawsuit  exposes  both  the                                                               
attorney and the client to defense attorney's fees.                                                                             
                                                                                                                                
MS.  JUNE PINNELL-STEPHENS  stated  opposition to  SB 97  because                                                               
when the  government makes  a mistake,  an individual  should not                                                               
have to pony  up the money to  go to court to  have it corrected.                                                               
Only by gathering together as  organizations can most individuals                                                               
hope to take on that sort of action.                                                                                            
                                                                                                                                
MR. CRAIG TILLERY, Assistant Attorney  General, Department of Law                                                               
(DOL), offered to answer questions.                                                                                             
                                                                                                                                
SENATOR  DYSON  asked  Mr.  Tillery to  explain  the  changes  in                                                               
Version D  and how those  changes will  clarify that the  bill no                                                               
longer pertains only to resource related litigation.                                                                            
                                                                                                                                
MR.  TILLERY  told  members  that   Version  D  is  substantially                                                               
different  from  the  original bill.  The  original  version  was                                                               
focused on  particular decisions by particular  agencies. Version                                                               
D  takes a  different  approach and  completely abrogates  public                                                               
interest  litigant  fees  except  in those  instances  where  the                                                               
legislature  may  choose  to  amend   by  statute.  For  example,                                                               
currently,  full  attorneys  fees  are provided  by  statute  for                                                               
consumer protection cases.                                                                                                      
                                                                                                                                
SENATOR DYSON said  his impression is that this bill  is aimed at                                                               
stopping  frivolous  lawsuits  that impede  resource  development                                                               
through  the use  of  court injunctions.  If  those lawsuits  are                                                               
filed for illegitimate reasons, the  plaintiff would pay the cost                                                               
of the  litigation. He asked if  Version D broadens the  scope to                                                               
the extent  it will  have a  dampening effect  on someone  in the                                                               
disability  community  who  challenges a  government  action  for                                                               
valid reasons but loses the case.                                                                                               
                                                                                                                                
MR. TILLERY told members the  original bill was broadened because                                                               
of  concern about  an equal  protection challenge.  DOL felt  the                                                               
original  bill  would  pass constitutional  muster,  however  the                                                               
argument would  be more difficult than  if the scope of  the bill                                                               
was  broadened. In  addition, the  original version  of the  bill                                                               
started  "writing  in  what  is  excepted  and  it  becomes  very                                                               
difficult to apply."                                                                                                            
                                                                                                                                
Regarding  the  effect on  an  individual  bringing a  disability                                                               
lawsuit in the public interest,  MR. TILLERY said Version D would                                                               
require the individual to decide  the likelihood of prevailing on                                                               
the  merits  of  the  case  before  filing.  If  the  legislature                                                               
believes  people should  be  able  to bring  a  specific type  of                                                               
lawsuit,  the  legislature could  make  that  judgment by  making                                                               
exceptions  in statute.  This bill  puts  that decision  squarely                                                               
back in  the hands  of the legislature  by eliminating  the court                                                               
system's broad-brush approach.                                                                                                  
                                                                                                                                
VICE-CHAIR  WAGONER  announced  that   Senator  Ben  Stevens  was                                                               
present.                                                                                                                        
                                                                                                                                
SENATOR  SEEKINS  asked  how  many states  have  adopted  a  rule                                                               
similar to Rule 82.                                                                                                             
                                                                                                                                
MR. TILLERY said  that very few, if any, have  a similar rule. He                                                               
said  the federal  system  does  not have  one  either. The  U.S.                                                               
Supreme Court stated  it is not the province of  the court system                                                               
to make  those judgments; public interest  litigant status should                                                               
be determined by a congressional or legislative decision.                                                                       
                                                                                                                                
MR.  TILLERY  said  some other  state  legislatures  might  grant                                                               
attorneys' fees  in specific instances, for  example for consumer                                                               
protection or anti-trust cases.  Nevertheless, as a general rule,                                                               
those decisions are not in the court's purview.                                                                                 
                                                                                                                                
SENATOR SEEKINS asked  if the legislature passes this  bill as it                                                               
exists today [Version D], it  could exempt certain types of cases                                                               
through another piece of legislation.                                                                                           
                                                                                                                                
MR. TILLERY said that is correct.                                                                                               
                                                                                                                                
SENATOR  ELTON  said  during  the  subcommittee  discussion,  his                                                               
understanding was that no court  rule would have to be eliminated                                                               
because  public interest  litigant status  is an  exception to  a                                                               
court rule. However, he learned  that a 1993 Supreme Court Order,                                                               
No. 11-18,  established a  court rule that  will be  abrogated by                                                               
this legislation.                                                                                                               
                                                                                                                                
MR. TILLERY  said it is  DOL's view  that the court  created that                                                               
rule through  judicial exception.  To remove the  court's ability                                                               
to apply that  exception via this legislation  would not abrogate                                                               
a court rule  but simply require the court to  apply the original                                                               
rule.                                                                                                                           
                                                                                                                                
SENATOR ELTON asked  Mr. Tillery if he is familiar  with the 1993                                                               
Supreme Court Order No. 11-18.                                                                                                  
                                                                                                                                
MR. TILLERY said he did not have a copy of it.                                                                                  
                                                                                                                                
SENATOR  ELTON said  it would  be  helpful to  understand why  an                                                               
exception is not a de facto court rule.                                                                                         
                                                                                                                                
MR. TILLERY offered  to get back to Senator Elton  with an answer                                                               
to that question.                                                                                                               
                                                                                                                                
SENATOR LINCOLN  asked the amount  of general fund  dollars spent                                                               
in 2002 on public interest litigation.                                                                                          
                                                                                                                                
MR. TILLERY said  from FY 93 through FY 03,  the state spent $4.5                                                               
million.                                                                                                                        
                                                                                                                                
SENATOR LINCOLN asked  how much of the $4.5 million  was spent on                                                               
state resource agency cases.                                                                                                    
                                                                                                                                
MR. TILLERY  said he would  have to  get back to  Senator Lincoln                                                               
with an answer to that question.                                                                                                
                                                                                                                                
3:50 p.m.                                                                                                                     
                                                                                                                                
MR.  KEN JACOBUS,  an attorney  in private  practice and  for the                                                               
Republican Party, said his comments  to the committee were on his                                                               
own behalf.  He said  he had  no problem  with the  original bill                                                               
because it was designed to address  a specific area of concern to                                                               
the  Governor:  protection  of  natural  resources  and  economic                                                               
development.  Although  he  prefers  other  solutions,  he  could                                                               
support the original  bill. However, he is  opposed to broadening                                                               
the  bill  to include  all  public  interest litigant  cases.  He                                                               
reminded  members  that  when  the   government  loses  a  public                                                               
interest  litigant case,  there is  nothing wrong  with requiring                                                               
the government to  compensate for its wrongdoing.  He pointed out                                                               
that  a number  of Republicans  would not  be in  the legislature                                                               
were  it  not  for  the  redistricting  case,  which  was  public                                                               
interest  litigation. Also,  a number  of  legislators could  not                                                               
have  collected  campaign  contributions but  for  the  Singleton                                                               
case, which  allowed unlimited  soft money  contributions, again,                                                               
public  interest  litigation.  He  said   if  a  voter  wants  to                                                               
challenge an election for a  good reason, this bill would require                                                               
the individual  voter to pay attorney's  fees to the state  if he                                                               
or she  loses the  case. He doubts  anyone would  have challenged                                                               
the Lindauer candidacy if that were the case.                                                                                   
                                                                                                                                
MR. JACOBUS said  he disagrees with Mr.  Tillery's statement that                                                               
Alaska  Civil Rule  82 has  a catch-all  provision that  says the                                                               
courts may  vary attorney's fees if  the equities of the  case so                                                               
direct. The court  can take any factor into  account to determine                                                               
the inequities  of the case.  If the court  is no longer  able to                                                               
consider certain  factors, that is  the limitation on  the catch-                                                               
all provision of Rule 82. He  advised that he has no problem with                                                               
the legislature  protecting natural  resource cases.  However, to                                                               
take away  the rights  of public  interest litigation  across the                                                               
board  is  inappropriate  because   of  the  numerous  unintended                                                               
consequences.  He  asked  members  not  to  enact  the  committee                                                               
substitute [Version D].                                                                                                         
                                                                                                                                
SENATOR  ELTON  noted the  purpose  section  of Version  D  cites                                                               
increased   litigation,  arguments   made   with  little   merit,                                                               
difficulties in compromising claims,  and significant cost to the                                                               
state  and  private  citizens  as  reasons  to  eliminate  public                                                               
interest  litigant  status.  He  said  when  he  read  that,  his                                                               
immediate thought  was that it may  save the state money,  but it                                                               
creates a  difficult standard  for Alaskan  citizens to  meet. He                                                               
asked Mr. Jacobus if that is the focus of his testimony.                                                                        
                                                                                                                                
MR. JACOBUS  said some of  the statements in the  purpose section                                                               
are not  really true. A person  is unlikely to bring  an argument                                                               
with little  merit because if  one loses a public  interest case,                                                               
he or she does not get  reimbursed for attorney's fees. He agrees                                                               
that  the public  interest litigant  doctrine leads  to increased                                                               
litigation, but  it does not  encourage frivolous  litigation. He                                                               
said it does not increase  difficulty in compromising claims and,                                                               
although  it may  cost the  state more  money, that  cost is  for                                                               
wrongs that need to be redressed.                                                                                               
                                                                                                                                
SENATOR ELTON maintained  his objection to adopting  Version D as                                                               
the working draft  before the committee. He said  he has concerns                                                               
with the original  bill, but those problems are  magnified in the                                                               
committee  substitute.  He  felt   Mr.  Jacobus's  testimony  was                                                               
compelling. He  stated his belief  that the only way  many Alaska                                                               
citizens   feel  able   to   challenge   an  overreaching   state                                                               
bureaucracy is through this rule.                                                                                               
                                                                                                                                
SENATOR BEN STEVENS  asked how many of the  testifiers are public                                                               
interest   litigant   attorneys.   He  questioned   whether   the                                                               
testifiers  today are  attorneys whose  fees are  paid by  public                                                               
interest litigants.                                                                                                             
                                                                                                                                
SENATOR  DYSON  indicated  he   takes  significant  exception  to                                                               
Senator  Stevens'  statement  if  it was  an  indictment  of  Mr.                                                               
Jacobus's testimony or integrity.                                                                                               
                                                                                                                                
SENATOR BEN  STEVENS said he was  just making the point  that the                                                               
committee needs to take that into consideration.                                                                                
                                                                                                                                
VICE-CHAIR WAGONER announced a brief at-ease.                                                                                   
                                                                                                                                
SENATOR SEEKINS  withdrew his  motion to adopt  Version D  as the                                                               
working draft before the committee.   He then moved to pass SB 97                                                               
from committee with individual recommendations.                                                                                 
                                                                                                                                
SENATOR ELTON objected.                                                                                                         
                                                                                                                                
SENATOR  LINCOLN told  members  she will  be  voting against  the                                                               
motion. She said the cost of most  of the cases has been small so                                                               
for  the legislature  to tell  Alaskans  they have  to give  much                                                               
thought to paying  their own attorney fees for  a public interest                                                               
case is  wrong. She  noted she  just received  a letter  from the                                                               
Alaska Village Council Presidents who  said they were involved in                                                               
three public interest litigant cases,  the Kasillie (ph) case and                                                               
challenges  to state  agency decisions  about  fish and  wildlife                                                               
management. They  are very concerned this  legislation will deter                                                               
the common  person from filing  a lawsuit against a  state agency                                                               
thereby allowing some bad public decisions to be made.                                                                          
                                                                                                                                
VICE-CHAIR WAGONER said  he would be supporting  the bill because                                                               
he  has seen,  at times,  the unfairness  of the  public interest                                                               
litigant doctrine.                                                                                                              
                                                                                                                                
The motion  to move  SB 97 from  committee carried  with Senators                                                               
Seekins, Dyson, Stevens and Wagoner  in favor, and Senators Elton                                                               
and Lincoln opposed.                                                                                                            
                                                                                                                                
VICE-CHAIR WAGONER  announced the bill  would move to  the Senate                                                               
Judiciary Committee with its appropriate fiscal notes.                                                                          

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