An evening with ag’s legal star

Jan 27, 2014

—Land rights attorney Karen Budd-Falen talks Equal Access to Justice

Though jokes and snide comments abound regarding the nature of lawyers, when one of agriculture’s legal champions talks about justice, it’s worth a listen.

In a recent talk held during the 108th National Western Stock Show, attorney Karen Budd-Falen— of the Budd-Falen Law Offices of Cheyenne, WY, and a name seen frequently in land-rights legal battles—regaled an audience of cattle producers with the state of the country and citizens’ access to justice.

“One of the most important things I’ve read as I’ve learned about the Constitution, is that when they wrote the Bill of Rights—the right to freedom of press, the right of free association, the right to bear arms—all of those were based on the right to own property. And the founding fathers believed that the right to own property was the basis of every other freedom that’s discussed in the U.S. Constitution.”

She explained how in her legal training and work as a land rights-focused attorney that the sanctity of property rights as discussed in the Constitution and the Bill of Rights is at the heart of many issues in the Western states. With the increasing population, increasing and diversified uses for/demands on the land, and increasing power of environmental groups, the right to own and control one’s own property is coming under more frequent—and increasingly more expensive—attack.

Justice for all?

“One of the other things we’re fighting against that I think is so important that people need to understand is that the federal government pays environmental groups to sue the federal government to stop our livelihood,” said Budd-Falen poignantly.

She was of course speaking of the Equal Access to Justice Act (EAJA), something dear to the hearts of public lands ranchers, though it is a troubled relationship to say the least.

Budd-Falen spoke of the difficulties involved with the well-meaning act which she described as having been hijacked.

“When Clinton was president he signed a thing called the Paperwork Reduction Act, and part of the Paperwork Reduction Act said that the federal government no longer has to account for the attorney’s fees that it pays out under [EAJA]. And groups like Western Watersheds Project and Wild Earth Guardians… and Center for Biological Diversity figured out that this is the greatest thing since sliced bread because they can sue the federal government, the Justice Department settles with them, and they get their attorney’s fees reimbursed.”

Roughly speaking, EAJA provides for the reimbursement of attorney fees to individuals and private businesses who take on the government in court and win.

EAJA limits who can apply for such reimbursement and the extent to which they can be reimbursed. Individuals with a net worth of less than $2 million, or businesses or groups with a net worth less than $7 million can be awarded funds following successful litigation of the government.

But there’s a catch. “The problem is that does not apply to ‘nonprofit public interest’ groups,” explained Budd-Falen. According to EAJA, 501(c)(3) nonprofit organizations are not included in the net worth limitations.

“The Center for Biological Diversity’s net worth is $10 million in 2012, and they get attorney’s fees,” began Budd-Falen as she listed out what she described as the most common offenders in making use of EAJA.

“Earth Justice Legal Foundation—because the Earth needs a good lawyer—net worth is $53,908,000 in 2012. They get their attorney’s fees reimbursed. Sierra Club—the quote “oldest and most effective” environmental group— net worth in 2012 was $101,873,803, and they get their attorney’s fees paid. And the big daddy of them all, Natural Resources Defense Council, net worth $248,958,243 as a nonprofit, public interest group, and they can get their attorney’s fees paid by the federal government when they sue the federal government.”

WLJ verified those numbers by examining the groups’ Form 990s, which— being nonprofit organizations—are required to be available to the public. The numbers were accurate with some rounding involved and differences in beginningversus end-of-the-year numbers being quoted. All numbers referred to Part 1, line 20 (Total Assets) of the groups’ Fiscal Year 2011 or Fiscal Year 2012 Form 990s. The Sierra Club net worth Budd-Falen mentioned referred to the Sierra Club Foundation, which is the 503(c)(3) portion of the Sierra Club family of groups.

Budd-Falen also spoke passionately of what she said was another glaring inequity within today’s EAJA. She explained that when EAJA was first signed into law by President Ronald Reagan, the intention was not to allow “attorneys [to make] a ton of money off of this thing” so a $125 per hour cap was placed on the rates of attorney fee reimbursements. Given changes and increases to the cost of living, that cap has risen to $186.55 in the first half of 2013 (most recent data).

“Those environmental groups that I just named, because they have ‘special add-ons’ that they have created out of total thin air and there’s no statutory authority, get reimbursed at $775 an hour.”

Reform efforts

There has been a respectable recent effort to reform EAJA by closing some of these loopholes, but things have been slow going. During the question and answer section following her talk, Budd-Falen fielded a couple questions on the state of EAJA reform bills. In the last two Congresses—the 112th Congress ranging from 2011-2012, and the current 113th Congress—at least four bills seeking to amend EAJA were fielded.

In 2011, two identical bills named the Government Litigation Savings Act were introduced in the House and the Senate—H.R. 1996 introduced by Rep. Cynthia Lummis (R-WY) and S. 1061 introduced by Sen. John Barrasso (R-WY), respectively—but both died in committee. The two bills sought to impose net worth limitations on nonprofits, restrict those litigation participants who could seek reimbursement to those directly impacted by the outcome of the case, and require public reporting of how much is paid out and to whom under EAJA.

“Originally the bills were going to try to reform the Act, because it is ridiculous that you pay a veteran’s attorney $180 an hour and you pay some wacko environmentalist’s attorney $775 an hour,” said Budd-Falen, responding to a question. “So the original bill tried to fix those problems. We couldn’t get that anywhere.”

The House bill from 2011 was reintroduced by Lummis in the current Congress under the new number H.R. 3037. An additional EAJA reform bill—H.R. 2919, Open Book on Equal Access to Justice Act—also by Lummis, has made a smaller, more specific request; transparency.

“Now we’re trying, just trying, for the transparency piece where they actually have to come up with a number because the federal government has no idea,” said Budd-Falen.

“I’ve used the Freedom of Information Act to try to get a number of cases filed against the federal government and how much they paid out and they don’t have the numbers. You would think that the Justice Department, the largest law court in the world, would be able to tell you how many times it’s been sued.”

She said based on what limited information she and her law firm had regarding lawsuits filed by nearly a dozen different environmental groups in as many states in the past four years, they estimated EAJA payouts to environmental groups cost the government $56 million.

“If I can find $56 million by sitting at my little computer in Cheyenne Wyoming, think of how much money we’re talking about,” she urged the audience. “We are going to keep pushing, but I’m going to tell you it is one of the most disappointing things we’re working on.”

Budd-Falen also pointed out that the bills have had a rocky history in terms of getting Democrat cosponsors and she stressed the need of Western ranchers to get involved with their local communities, state-level leaders and Washington representatives.

“I talk to livestock industry all the time and they’re like, ‘well, why should we do PR? Why should we spread the word?’ Well, people need us—we’re growing food and fiber—but they don’t know. People in Denver do not know. We have to get more involved. We have to be involved in these issues. You have to be involved in these issues.”

Currently, both H.R. 3037 and H.R. 2919 are in committee since they were introduced in August, 2013. They are both with the House Judiciary committee’s Constitution and Civil Justice subcommittee. Subcommittee members include Chairman Trent Franks (R-AZ8), Ranking Member Jerrold Nadler (D-NY10), Steve Chabot (R-OH1), Steve Cohen (D-TN9), John Conyers Jr. (D-MI13), Ron Desantis (R-FL6), Theodore Deutch (D-FL21), Randy Forbes (R- VA4), Louie Gohmert Jr. (R-TX1), Jim Jordan (R- OH4), Steve King (R-IA4), Bobby Scott (D-VA3), and Jason Smith (R-MO8). The House will reconvene today and work through Wednesday. It will also be in session next week running Monday through Thursday. — Kerry Halladay, WLJ Editor