WASHINGTON – ?Legislation introduced today by Senate Judiciary Committee Chairman Chuck Grassley of Iowa and Representative Doug Collins of Georgia seeks to end the practice of enacting federal regulations through sue-and-settle litigation. This tactic, used by federal agencies and like-minded special interest groups, circumvents the normal rulemaking process to impose new, burdensome regulations on businesses and communities.  The Sunshine for Regulatory Decrees and Settlements Act of 2015 shines a light on sue-and-settle litigation and restores the transparency, public participation and judicial review protections of the rulemaking process. 

Sue-and-settle litigation is defined by closed-door negotiations between pro-regulatory special interest groups and complicit federal agencies, which result in consent decrees or settlement agreements that bind executive discretion.  Unlike the normal rulemaking process, potentially-affected parties – such as businesses and even the states – are often kept completely in the dark about the negotiations, and the resulting regulations can come as a complete surprise.  

“Sue-and-settle litigation allows federal agencies to short-circuit the controls that Congress has set in place to ensure transparency in the rulemaking process.  These tactics result in new federal regulations imposed on American businesses and ultimately, on American families, all without an adequate opportunity for the public to weigh in. Sue-and-settle litigation makes a mockery of the public accountability and transparency protections required by the Administrative Procedures Act.  It also limits the ability of the executive branch to engage in principled decision making. This bill helps restore regulatory accountability by allowing for public scrutiny and comment on proposed federal regulations, and by making it easier for affected parties to take part in settlement negotiations,” Grassley said.

“Regulation by litigation subverts the normal regulatory process, denying Americans, especially Northeast Georgians who depend on agriculture, a seat at the national table. This bill would shed light on backroom deals between federal agencies and special interests – increasing transparency to provide the public its say in executive decision-making. This Administration’s rush to settle with litigious outside groups is costing us jobs and income. We’re giving more people a voice in the outcome,” Collins said.

Sue-and-settle litigation operates as an affront to the accountability components of the rulemaking process, and results in unchecked regulatory burdens on American families and businesses, especially small businesses.  Even once the privately-negotiated consent decrees or settlement agreements are disclosed, their terms often commit federal agencies to fulfill new regulatory mandates under accelerated timeframes, preventing any meaningful scrutiny or review.

By hiding behind an agreement or decree entered by a court, federal agencies can use sue-and-settle tactics to sidestep the rulemaking process and skirt accountability.  The strategy allows pro-regulatory special interest groups to sue an agency, citing its failure to meet a regulatory deadline.  In closed-door, often friendly negotiations, the agency can agree to undertake regulatory actions, without having to account for the concerns of those most impacted by the new rule. 

To push back against the growing use of sue-and-settle litigation, the Sunshine for Regulatory Decrees and Settlements Act of 2015 reinforces the transparency and accountability protections built into the normal rulemaking process by federal laws and executive orders.  Specifically, the bill:

  • Provides for greater transparency by requiring agencies to publicly post and report to Congress information on sue-and-settle complaints, consent decrees and settlement agreements;
  • Prohibits the same-day filing of complaints and pre-negotiated consent decrees and settlement agreements in cases seeking to compel agency action;
  • Requires that consent decrees and settlement agreements be filed only after interested parties have had the opportunity to intervene in the litigation and join settlement negotiations, and only after any proposed consent decree or settlement has been published for at least 60 days to provide for notice and comment;
  • Requires courts considering approval of consent decrees and settlement agreements to account for public comments and compliance with regulatory process statutes and executive orders;
  • Requires the Attorney General or, where appropriate, the defendant agency’s head, to certify to the court that he or she has approved any proposed consent decree that includes terms that:
    • Convert into a duty an otherwise discretionary authority of an agency to take regulatory action;
    • Commit an agency to expend funds that have not been appropriated and budgeted for the action in question;
    • Commit an agency to seek a particular appropriation or budget authorization; 
    • Divest an agency of discretion committed to the agency by statute or the Constitution; or
    • Otherwise affords relief that the court could not enter under its own authority; and
  • Makes it easier for succeeding administrations to move the courts for modifications of a prior administration’s consent decrees by providing for de novo review of motions to modify, if the circumstances have changed.

Original cosponsors of the Sunshine for Regulatory Decrees and Settlements Act of 2015 include senators Roy Blunt (R-Mo.), Ted Cruz (R-Texas), Orrin Hatch (R-Utah), Rand Paul (R-Ky.), John Cornyn (R-Texas), Marco Rubio (R-Fla.), Jim Inhofe (R-Okla.), Deb Fischer (R-Neb.), Jeff Flake (R-Ariz.), Mike Lee (R-Utah), Shelley Moore Capito (R-W.Va.) and Cory Gardner (R-Colo.), and representatives Ted Yoho (R-Fla.), Robert Latta (R-Ohio), Blake Farenthold (R-Texas), Renee Ellmers (R-N.C.), Lamar Smith (R-Texas), Tom Marino  (R-Pa.), Steve Chabot (R-Ohio), Dave Trott (R-Mich.) and Bob Goodlatte (R-Va.), chairman of the House Judiciary Committee.

Text of the legislation is available here.