    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

     FEDERAL CONSENT DECREE FAIRNESS ACT, AND THE SUNSHINE FOR REGULATORY
                      DECREES AND SETTLEMENTS ACT OF 2012

    =======================================================================

                                    HEARING

                                   BEFORE THE

                       SUBCOMMITTEE ON COURTS, COMMERCIAL
                             AND ADMINISTRATIVE LAW

                                     OF THE

                           COMMITTEE ON THE JUDICIARY
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 SECOND SESSION

                                       ON

                            H.R. 3041 and H.R. 3862

                                   __________

                                FEBRUARY 3, 2012

                                   __________

                               Serial No. 112-83

                                   __________

             Printed for the use of the Committee on the Judiciary

          Available via the World Wide Web: http://judiciary.house.gov

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                           COMMITTEE ON THE JUDICIARY

                          LAMAR SMITH, Texas, Chairman
    F. JAMES SENSENBRENNER, Jr.,         JOHN CONYERS, Jr., Michigan
        Wisconsin                        HOWARD L. BERMAN, California
    HOWARD COBLE, North Carolina         JERROLD NADLER, New York
    ELTON GALLEGLY, California           ROBERT C. ``BOBBY'' SCOTT,
    BOB GOODLATTE, Virginia                  Virginia
    DANIEL E. LUNGREN, California        MELVIN L. WATT, North Carolina
    STEVE CHABOT, Ohio                   ZOE LOFGREN, California
    DARRELL E. ISSA, California          SHEILA JACKSON LEE, Texas
    MIKE PENCE, Indiana                  MAXINE WATERS, California
    J. RANDY FORBES, Virginia            STEVE COHEN, Tennessee
    STEVE KING, Iowa                     HENRY C. ``HANK'' JOHNSON, Jr.,
    TRENT FRANKS, Arizona                  Georgia
    LOUIE GOHMERT, Texas                 PEDRO R. PIERLUISI, Puerto Rico
    JIM JORDAN, Ohio                     MIKE QUIGLEY, Illinois
    TED POE, Texas                       JUDY CHU, California
    JASON CHAFFETZ, Utah                 TED DEUTCH, Florida
    TIM GRIFFIN, Arkansas                LINDA T. SANCHEZ, California
    TOM MARINO, Pennsylvania             JARED POLIS, Colorado
    TREY GOWDY, South Carolina
    DENNIS ROSS, Florida
    SANDY ADAMS, Florida
    BEN QUAYLE, Arizona
    MARK AMODEI, Nevada

          Sean McLaughlin, Majority Chief of Staff and General Counsel
           Perry Apelbaum, Minority Staff Director and Chief Counsel
                                     ------

           Subcommittee on Courts, Commercial and Administrative Law

                     HOWARD COBLE, North Carolina, Chairman

                   TREY GOWDY, South Carolina, Vice-Chairman

    ELTON GALLEGLY, California           STEVE COHEN, Tennessee
    TRENT FRANKS, Arizona                HENRY C. ``HANK'' JOHNSON, Jr.,
    DENNIS ROSS, Florida                   Georgia
    BEN QUAYLE, Arizona                  MELVIN L. WATT, North Carolina
                                         JARED POLIS, Colorado

                          Daniel Flores, Chief Counsel

                          James Park, Minority Counsel

                                C O N T E N T S

                                  ----------

                                FEBRUARY 3, 2012

                                                                       Page

                                   THE BILLS

    H.R. 3041, the ``Federal Consent Decree Fairness Act''...........     2
    H.R. 3862, the ``Sunshine for Regulatory Decrees and Settlements
      Act of 2012''..................................................    11

                               OPENING STATEMENTS

    The Honorable Howard Coble, a Representative in Congress from the
      State of North Carolina, and Chairman, Subcommittee on Courts,
      Commercial and Administrative Law..............................     1
    The Honorable John Conyers, Jr., a Representative in Congress
      from the State of Michigan, and Ranking Member, Committee on
      the Judiciary..................................................    19

                                   WITNESSES

    Roger R. Martella, Jr., Sidley Austin LLP
      Oral Testimony.................................................    21
      Prepared Statement.............................................    24
    David Schoenbrod, Trustee Professor of Law, New York Law School,
      Visiting Scholar, American Enterprise Institute
      Oral Testimony.................................................    31
      Prepared Statement.............................................    34
    Andrew M. Grossman, Visiting Legal Fellow, The Heritage
      Foundation
      Oral Testimony.................................................    44
      Prepared Statement.............................................    46
    John C. Cruden, President, Environmental Law Institute
      Oral Testimony.................................................    65
      Prepared Statement.............................................    67

                                    APPENDIX
                   Material Submitted for the Hearing Record

    Prepared Statement of the Honorable Steve Cohen, a Representative
      in Congress from the State of Tennessee, and Ranking Member,
      Subcommittee on Courts, Commercial and Administrative Law......    99
    Prepared Statement of the Honorable John Conyers, Jr., a
      Representative in Congress from the State of Michigan, and
      Ranking Member, Committee on the Judiciary.....................   100
    Response to Post-Hearings Questions from Roger R. Martella, Jr.,
      Sidley Austin LLP..............................................   102
    Response to Post-Hearings Questions from John C. Cruden,
      President, Environmental Law Institute.........................   106
    Letter in opposition to H.R. 3041, from Kenny Cieplik, Kenneth
      Cieplik, and Paula Cieplik.....................................   112
    Letter from the American Bar Association (ABA)...................   114
    Letter from the Natural Resources Defense Council (NRDC).........   118

     FEDERAL CONSENT DECREE FAIRNESS ACT, AND THE SUNSHINE FOR REGULATORY
                      DECREES AND SETTLEMENTS ACT OF 2012

                                  ----------

                            FRIDAY, FEBRUARY 3, 2012

                  House of Representatives,
                        Subcommittee on Courts,
                     Commercial and Administrative Law,
                                    Committee on the Judiciary,
                                                        Washington, DC.

        The Subcommittee met, pursuant to call, at 9:32 a.m., in
    room 2141, Rayburn House Office Building, the Honorable Howard
    Coble (Chairman of the Subcommittee) presiding.
        Present: Representatives Coble, Gowdy, Ross, Quayle, Cohen,
    Conyers, Johnson, and Watt.
        Staff Present: (Majority) Daniel Flores, Subcommittee Chief
    Counsel; Johnny Mautz, Counsel; Rachel Dresen, Professional
    Staff Member; Omar Raschid, Professional Staff Member; Ashley
    Lewis, Clerk; and (Minority) James Park, Subcommittee Chief
    Counsel.
        Mr. Coble. The Subcommittee will come to order.
        Today's hearing will highlight two important pieces of
    legislation dealing with consent decrees. Oftentimes when the
    Federal Government is sued by special interests for failure to
    fulfill its regulatory obligations, the Government will enter a
    consent decree in lieu of litigating. In these cases, the
    plaintiffs are reimbursed for their attorneys' fees, and the
    agencies are bound to the terms of the judicially approved
    decree.
        Unfortunately, consent decree cases have become so
    commonplace that they are referred to as ``sue and settle''
    litigation, and they have created a new path of regulatory
    influence whereby special interests use lawsuits and the courts
    to force the Federal Government to implement its priorities in
    the form of regulations.
        Although consent decrees are efficient, they are not a wise
    method for issuing regulations. There is no public comment, and
    there is minimal disclosure, and they carry the force of law,
    which is difficult to overcome or challenge.
        The first of the two bills being considered today is H.R.
    3041, the ``Federal Consent Decree Fairness Act.'' This
    legislation is intended to enhance the ability of State and
    local governments to show that consent decrees should be
    changed or even terminated, including when voters elect a new
    State or local administration.
        [The bill, H.R. 3041, follows:]

                                   __________
        Mr. Coble. The other bill scheduled for our review today is
    H.R. 3862, the ``Sunshine for Regulatory Decrees and
    Settlements Act of 2012.'' This legislation would infuse much-
    needed transparency and disclosure into sue and settle
    litigation by adding several requirements that will provide
    notice to stakeholders and will ensure that these decrees are
    adequately approved.
        [The bill, H.R. 3862, follows:]

                                   __________
        Mr. Coble. Under the Administrative Procedure Act,
    stakeholders are protected by a set of rules that enable public
    notice of comment for proposed regulations. Another measure
    created by consent decrees is that there is typically no notice
    or public comment before a decree is approved, which is
    particularly disconcerting when the terms of the decree are
    pre-negotiated between the special interest groups and the
    Government.
        When this occurs, the special interest is the only
    stakeholder with an opportunity to comment on the decree or
    know what is being negotiated. In addition, the special
    interest is also being reimbursed for its attorneys' fees by
    the Federal Government. I am not opposed to consent decrees,
    per se, but they should not replace or supplant our regulatory
    process.
        These decrees cannot account for social changes or
    technological innovation, and their covert nature undermines
    the fundamental principles of our notice and comment rulemaking
    system.
        I look forward to hearing from our witnesses today on these
    important and timely bills and reserve the balance of my time.
        On the panel is the distinguished gentleman from South
    Carolina, Mr. Gowdy; the distinguished gentleman from Arizona,
    Mr. Quayle; and to my left, the distinguished gentleman from
    Michigan, Mr. Conyers. Did you want to be heard on opening
    statement?
        Mr. Conyers. Yes, Mr. Chairman----
        Mr. Coble. And John, if you would suspend for a minute?
        I am told there is going to be votes on or about 10:30 a.m.
    So we will try to move it along as quickly as we can rather
    than hold you all up as well.
        The gentleman from Michigan?
        Mr. Conyers. Thank you, Chairman Coble.
        And I am pleased to be here this morning. To notice that we
    are taking up not one bill, but two bills, and I assume there
    is some relationship between the two that I would like to hear
    about as the hearing goes on. Because the second bill was only
    introduced on Wednesday of this week in the evening, which I
    think would hardly give the Members or the witnesses an
    opportunity to make some evaluation of it.
        So I am trying to understand what makes legislating on
    Federal consent decrees an important measure, and then we add
    to it a bill called the Sunshine for Regulatory Decrees and
    Settlements Act. These bills, I think, may undermine a key tool
    in guaranteeing the rights and protections that we have enacted
    for a long while, and in some ways, they may be very harmful to
    civil rights considerations and environmental law
    considerations because the consent decree, of course, is a
    voluntary settlement between the plaintiffs and defendants
    entered by a court and enforceable by judicial orders of the
    court.
        They are used frequently, and I haven't heard any
    particular objection to them or abuse that requires our
    examination of Federal legislation modifying the rules that
    surround them right now.
        So I would like to point out that the major bill, 3041,
    could have the effect of virtually eliminating consent decrees
    against State and local governments by imposing unworkable time
    limits on them. This could present a very--this would worsen
    the utilization of consent decrees, not improve it.
        And so, it seems to me that there may be a motive to
    prevent Federal regulatory actions from being implemented in
    3862. It would needlessly slow down the process by which
    consent decrees are entered.
        So I think Rule 60 requires a court to revisit its decrees
    when changed circumstances merit modifying or even terminating
    such a decree. The Supreme Court has spoken on this in Frew v.
    Hawkins, that Federal courts must be deferential to State and
    local government prerogatives when considering whether a
    consent decree should be modified.
        And so, I think Attorney General Edwin Meese some three
    decades ago, and I haven't praised his services recently, but I
    think he did set forth the guidelines to determine whether or
    not to enter in consent decrees and settlements.
        So I thank you for the opportunity to view these ideas and
    hope that any members of the panel that would like to comment
    to them as we proceed would please do so.
        Thank you, Chairman Coble.
        Mr. Coble. I thank the gentleman.
        And I will say, Mr. Conyers, that drafts of the bill were
    made available I think on Sunday to the minority and also I
    think to the witnesses as well. Is that right, Daniel?
        We have been joined by Mr. Johnson. He is the distinguished
    gentleman from Georgia.
        And we will proceed as planned. I will introduce our panel
    of outstanding witnesses initially. Mr. Roger Martella is a
    partner of the environmental practice group of Sidley Austin
    LLP. He recently rejoined Sidley Austin LLP after serving as
    the general counsel of the United States Environmental
    Protection Agency, concluding 10 years of litigating and
    handling complex environmental and natural resources matters at
    the Department of Justice and EPA.
        Mr. Martella's practice focuses on three primary areas.
    First, he advises companies on developing strategic approaches
    to achieve their goals in light of rapidly developing demands
    to address climate change, promote sustainability, and utilize
    clean energy. Second, Mr. Martella handles a broad range of
    environmental and natural resources litigation and mediation.
    And finally, Mr. Martella advises multinational companies on
    compliance with environmental laws in the United States, China,
    the European Union, and other nations.
        Mr. Martella is a graduate of the Cornell University and
    the Vanderbilt University School of Law.
        Mr. Schoenbrod teaches environmental law at New York Law
    School and is the visiting scholar at the American Enterprise
    Institute. He has served as a senior staff attorney for the
    Natural Resources Defense Council, where he was instrumental in
    efforts to remove lead from gasoline. He is a pioneer in the
    field of environmental law and is currently examining how
    Congress could restructure environmental statutes so that their
    objectives can be achieved more effectively and efficiently.
        Professor Schoenbrod studies all major environmental areas.
    He also studies litigation in which court decrees dictate the
    management of governmental institutions such as prisons,
    schools, and foster care agencies. After receiving a bachelor's
    degree from Yale, Professor Schoenbrod was a Marshall Scholar
    at the Oxford University and later received an LLB also from
    Yale.
        Mr. Andrew Grossman is a visiting legal fellow in the
    Heritage Foundation's Center for Legal and Judicial Studies,
    where he researches and writes about law and finance,
    bankruptcy, national security law, and the constitutional
    issues of separation of powers.
        Outside Heritage, Mr. Grossman is a litigator in the
    Washington office of the global law firm Baker and Hostetler.
    He also represents States in challenges to the
    constitutionality of Federal statutes and the legality of
    Federal environmental regulations.
        He also is active in commercial litigation and received a
    bachelor's degree in economics and anthropology from Dartmouth
    College, a master's degree in government from the University of
    Pennsylvania, and a J.D. from the George Mason University
    School of Law.
        Finally, Mr. John Cruden is the fourth president of the
    Environmental law Institute (ELI). Mr. Cruden joined ELI after
    serving at the U.S. Department of Justice, where he served as
    Deputy Assistant Attorney General, Environmental and Natural
    Resources Division, a position he has held since 1995.
        At the Department of Justice, Mr. Cruden supervised Federal
    civil environmental litigation involving agencies of the United
    States and oversaw the Environment Section and Environmental
    Defense Section. He has personally litigated and led in
    settlement negotiations in numerous environmental cases, many
    with reported decisions. He also has led the Department of
    Justice delegations to international environmental conferences.
        Mr. Cruden is a graduate of the United States Military
    Academy, University of Santa Clara, and the University of
    Virginia.
        We are blessed with an outstanding panel, and good to have
    you all with us. Gentlemen, we try to comply with the 5-minute
    rule. There is a timer on your panel there that will go from
    green to yellow to red. When the yellow--amber light appears,
    that is your warning that you have a minute to go, and the ice
    on which you are skating is becoming thinner and thinner.
        But you won't be punished if you violate it, but if you
    could wrap up within 5 minutes, we will be appreciative to you.
        Mr. Martella, why don't you start us off?
        If you will suspend, Mr. Martella, we have also been joined
    by the distinguished gentleman from North Carolina, my
    colleague Mr. Mel Watt, and Mr. Ross from Florida has joined us
    as well.
        Mr. Martella, you are recognized for 5 minutes.
        Mr. Martella, pull that mic a little closer or else it may
    not be activated. I don't think your mike is activated.

         TESTIMONY OF ROGER R. MARTELLA, JR., SIDLEY AUSTIN LLP

        Mr. Martella. Oh, is it working now? Thank you. Can you
    hear me?
        Again, good morning, Chairman Coble and Members of the
    Subcommittee. Thank you for providing me the opportunity and
    the honor to appear before you today.
        The subject of today's hearing is critically important
    because it raises issues about fairness, transparency, and
    public participation in administrative rulemakings while
    providing a mechanism for the executive branch to ensure sound
    and principled decision-making in this very litigious
    environment that we all inhabit.
        The focus of my testimony today is going to be on the
    Sunshine Act.
        By way of background, I am a lifelong environmentalist and
    a career environmental lawyer. I am very proud to have spent
    the majority of my career in public service, including at the
    Justice Department and as the general counsel of the EPA. I
    have also served and continue to serve with several
    environmental nongovernmental organizations.
        I would like to start with the uncontroversial proposition
    that rulemaking activity is built upon three bedrock principles
    of transparency, public participation, and judicial review. The
    Administrative Procedure Act guarantees these principles and
    protections for all citizens when the Government engages in
    rulemaking.
        However, the APA is confronting new challenges that in some
    cases are bypassing these important protections. Today, I want
    to share with you my concern about recent efforts to circumvent
    these protections in an emerging phenomenon I call ``off ramp
    settlements'' because they provide an off ramp to transparency,
    public participation, and judicial review.
        The concern arises out of a growing trend where certain
    groups increasingly are employing a sue and settle approach to
    the Government on regulatory issues. Such an approach
    effectively provides an off ramp that ignores these bedrock
    principles, including a lack of transparency.
        In off ramp settlements, discussions and agreements
    typically are reached with a subset of interested parties
    without full stakeholder input and frequently take place
    outside the boundaries of the public process.
        A lack of public participation. In most off ramp
    settlements, public participation is foreclosed twice.
        First, the agreement on how to regulate is reached without
    full input of stakeholders that are affected. Second, the
    negotiated deadlines for final rules are frequently so quick
    that the public's comments might receive little weight in the
    actual subsequent rulemaking.
        A lack of judicial review. In off ramp settlements, parties
    frequently reach an agreement before a lawsuit is even filed,
    thus depriving interested parties from intervening in the
    litigation to defend their interests. Even where settlement
    occurs after intervention, such parties have little to no
    opportunity to participate in the settlement discussions.
        And finally, a conflation of governmental and
    nongovernmental roles. In these settlements, the plaintiffs
    effectively set the priorities and the timelines for how the
    Government enacts certain rulemakings over other competing
    resources and concerns. These concerns regarding off ramp
    settlements are not theoretical or abstract, but have been
    rising with increasing frequency in the last several years and
    are referred to by some of the plaintiffs themselves as ``mega
    settlements.''
        Two recent examples include endangered species
    consultations where last year the Fish and Wildlife Service and
    certain groups filed joint settlement agreements committing the
    services to take action regarding 600 species during fiscal
    years 2011 and 2012. And also greenhouse gas new source
    performance standards, where in December of 2010 EPA announced
    a consent decree with several groups committing the agency to
    propose and finalize the first-ever new source performance
    standards for greenhouse gases without any prior input from the
    affected stakeholders.
        EPA specifically proposed to have the first proposals in
    July of 2011, 6 months after the consent decree, which was an
    unprecedented quick schedule the agency already has missed.
        Thus, the off ramp settlement approach risks the
    transparency, public participation, and judicial review
    protections Congress has established for all stakeholders in
    rulemakings. However, elements of the sunshine bill before the
    Subcommittee today could help ensure that these public
    protections remain in effect, while preserving the Government's
    broad discretion to enter into settlement agreements in the
    first place.
        Specifically, provisions of the sunshine bill proposal
    would require transparency by providing a process for affected
    parties to be notified of proposed agreements so that such
    parties can assess whether to intervene. In environmental
    decision-making, transparency is a good thing not to be feared
    or avoided.
        The sunshine bill would provide public participation by
    allowing comment on any issue related to the matters alleged in
    the complaint or addressed in the proposed agreement.
    Government agencies would be required to respond to comments,
    and the court would assess whether the subsequent rulemakings
    allow adequate time for real public comment once the
    rulemakings commence.
        The sunshine bill would enable judicial review by providing
    for intervention prior to the finalization of an agreement. In
    addition, the proposal provides the opportunity to bring
    interveners to the settlement table to contribute ideas through
    a mediation process, and the sunshine bill would affirm the
    priority-setting discretion of agencies by requiring
    certifications on the creation of new mandatory duties.
        In conclusion, these key principles, promoted in the
    proposed Sunshine Act, will hopefully bring little controversy.
    The measure would preserve the ability of the Government to
    seek efficient settlement agreements with its full discretion
    while assuring along the way that information is shared, the
    public has an ability to participate and be heard, and that the
    views of the parties that could be adversely affected are
    considered by the agency and the court.
        Thank you again for the opportunity to share my views on
    these important proposals. I would be happy to answer any
    questions.
        [The prepared statement of Mr. Martella follows:]

                                   __________

        Mr. Coble. Thank you, Mr. Martella.
        Mr. Schoenbrod, you are recognized.

     TESTIMONY OF DAVID SCHOENBROD, TRUSTEE PROFESSOR OF LAW, NEW
        YORK LAW SCHOOL, VISITING SCHOLAR, AMERICAN ENTERPRISE
                               INSTITUTE

        Mr. Schoenbrod. Chairman Coble, Members of the Committee--I
    thought I pressed the button. Do you hear it now? Okay.
        Thank you for the opportunity to be here today and testify.
        I am going to focus my comments on the Federal Consent
    Decree Fairness Act. The objective should be for Federal courts
    to enforce rights effectively, but in a way that intrudes as
    little as possible on the power of elected officials to make
    policy.
        But that is not what we have today. We have thousands of
    decrees against State and local government in Federal courts.
    Many of these decrees last for a very long time, and it is very
    hard for State and local officials to get the decrees changed,
    even though many of the well-intentioned ideas built into these
    highly detailed decrees prove to have unintended consequences.
        And I know that as a former plaintiff's lawyer myself. They
    often fit badly with changing circumstances, and they are often
    contrary to the priorities that constituents expressed in new
    elections.
        State officials need to be able to modify the decree, but
    in a way that still protects rights. And that is not possible
    under current court rules, even though there is language from
    the Supreme Court that says that should be the case.
        We need Congress to step in to create a new rule, and the
    Federal Consent Decree Fairness Act is the right new rule. It
    is right in three particular ways. The timing for a motion to
    change the decree is right, the standard for changing the
    decree is right, and the burden allocation is right.
        As to the timing, the defendants are allowed to make a
    motion to change the decree in sync with the election cycle.
    That is the right timing in a democracy.
        Second, the standard for changing the decree is whether the
    rights would still be protected, and that is the right standard
    in a constitutional democracy where we care about protecting
    rights.
        The burden. The burden is placed on the plaintiffs to show
    the decree is still needed to protect the rights. That is the
    right allocation of burden. Otherwise, defendants have to prove
    a negative, and courts customarily place the burden on
    plaintiffs who want courts to stop elected officials from
    making policy.
        It is true that in these consent decrees some defendant
    Mayor or Governor once consented to the entry of the decree,
    but it is wrong to presume that the decree is still the right
    policy choice for the current Mayor or Governor elected in a
    subsequent election, especially, especially when the rights
    being enforced as popular rights. And we know they are popular
    rights because almost all these decrees are enforcing statutes
    enacted by Congress because constituents think they are a good
    idea.
        The burden should be on the plaintiff to show the decree is
    still needed. And if the plaintiffs can show that, then the
    decree should remain in force.
        Now it has been asserted that this Federal Consent Decree
    Fairness Act would prevent the continued use of consent
    decrees. I think that is just wrong.
        First of all, there are major, major incentives for
    litigants to adopt consent decrees. Current court rules say
    that if there is not a consent decree, the judge is strictly
    limited in what could be put into a decree. The judge has to
    hew very closely to rights. With a consent decree, the decree
    could go much more broad than that, cover other material.
        Beyond that, the consent decree provides a way of rapidly
    getting a change rather than waiting for years of litigation.
    It reduces the uncertainty that comes from litigation and
    appeals. It means the plaintiffs' attorneys get their attorney
    fees more rapidly. And beyond that, there is the right under
    the statute for the plaintiffs to show the decree is still
    needed.
        So the idea that this statute, this bill would prevent the
    use of consent decrees I think is simply wrong.
        A final point I would like to make is it seems to me that
    there is a special need for Congress to act in this matter now.
    Most of these decrees are to enforce statutes that Congress has
    enacted in areas like foster care and health and other matters.
    Most of these statutes give the States very wide discretion in
    how they implement them.
        However, the decrees take that discretion away. That
    discretion is needed because elected officials of the State and
    local government need the ability to adapt what they are doing
    to changing circumstances, to what has been learned. And that
    need for flexibility is especially important today when so many
    States and localities are in fiscal difficulty, and they need
    to find creative ways of doing what voters need better, faster,
    cheaper.
        And these old, ancient decrees, the thousands of them, many
    hundreds of pages long--and I myself, as a plaintiff lawyer,
    have drafted those decrees--put glue in the mechanism of
    government to adapt to change.
        [The prepared statement of Mr. Schoenbrod follows:]

                                   __________

        Mr. Coble. Thank you, Mr. Schoenbrod.
        I failed to mention earlier the two bills on this matter
    have been introduced by two of our colleagues. H.R. 3041 by the
    gentleman from Arizona, Mr. Quayle, and Mr. Cooper from
    Tennessee has introduced 3041.
        Pardon? I stand corrected. Mr. Quayle is 3862. Mr. Cooper
    is 3041.
        Mr. Grossman, you are recognized for 5 minutes.

      TESTIMONY OF ANDREW M. GROSSMAN, VISITING LEGAL FELLOW, THE
                          HERITAGE FOUNDATION

        Mr. Grossman. Mr. Chairman and Members of the Subcommittee,
    thank you for holding this hearing today and for inviting me to
    testify.
        My statement today, like my written testimony, will focus
    on consent decrees that restrict the future discretion of the
    Federal Government. In particular, I will discuss how these
    types of decrees threaten the constitutional separation of
    powers and democratic self-rule and what Congress can do about
    it.
        I will begin with the constitutional issues. It is
    important here to define terms. What we are concerned about are
    provisions of consent decrees and in some cases settlement
    agreements that purport to constrain the future discretion of
    executive branch officials or the legislative branch.
        Entry of a consent decree gives the court the power to
    enforce its terms on par with any normal judgment. The Federal
    Government, and the executive branch in particular, is not an
    ordinary litigant who may be subject to the judiciary's powers
    in every single instance. It is a coequal branch of the
    Government with its own powers that it may not trade or share
    with the other branches.
        Particularly, those powers directly assigned by the
    Constitution to the President are inalienable. He may not, for
    example, agree to be bound in his exercise of the veto power or
    in his power to recommend legislation to Congress. Most
    broadly, he may not and should not bargain away the executive
    power, such as by cabining future exercises of discretion. Nor
    may he trade away powers that belong to Congress, such as the
    power of the purse.
        These prohibitions are not just legal niceties. Breaching
    the separation of powers has real consequences. In general,
    public policy should be made in public through the normal
    mechanisms of legislating and administrative law and subject to
    the give-and-take of politics.
        When, for reasons of convenience or advantage, public
    officials attempt to make policy in private, it is the public
    interest that suffers in a number of ways. First is the setting
    of priorities. Consent decrees can undermine presidential
    control of the executive branch, empowering activists and
    subordinated officials to set Federal priorities.
        Regulatory actions are subject to the usual give-and-take
    of the political process, with the Congress, outside groups,
    and the public all influencing an Administration's or an
    agency's agenda through formal and informal meetings. Not so in
    court.
        Second is transparency. Consent decrees are often faulted
    as secret regulation because they occur without public notice
    and participation. To be clear, consent decrees can effectively
    constitute regulation by requiring agencies to make specific
    policy choices in subsequent rulemakings, thereby taking
    certain issues off the table.
        This runs counter to the wisdom embodied in the
    Constitution and in administration law. The public scrutiny and
    participation in law making leads to better substantive
    results.
        Third is the elimination of flexibility. As the Reagan
    administration learned the hard way, consent decrees limit the
    Government's ability to alter its plans and to select the best
    response to address any given problem. In this way, they may
    freeze the regulatory processes of representative democracy.
        Fourth is that consent decrees undermine accountability by
    shifting responsibility from public officials to judges and
    private litigants. It is very convenient that tough issues can
    be foisted on the courts, but it is also damaging to our
    politic.
        None of these problems are intractable. There are
    solutions, and here is the easiest, most straightforward one.
    In an ideal world, the executive branch would take full
    responsibility for the exercise of its powers and would refuse
    to cede its authority to the courts and to private party
    litigants despite the promise of some short-term gain from
    doing so.
        But now let us consider the world that we are in. Congress
    can and should adopt certain common sense policies that provide
    for transparency and accountability in decrees that compel
    future Government action.
        First is transparency. All proposed decrees should be
    subject to notice and comment. DOJ should also be required to
    report to Congress in the Government's use of consent decrees.
        Second is more robust public participation. An agency
    should be required to respond to comments, and parties that
    would have standing to challenge an action taken pursuant to a
    consent decree should have the right to intervene in a lawsuit
    where one may be lodged.
        Third, where a consent decree compels an agency to take
    regulatory action, it should have to demonstrate that its
    proposed schedule affords sufficient time to comply with all
    requirements and furthers the public interest.
        Fourth, let us give the public interest a seat at the table
    by requiring supporters of a consent decree to demonstrate by
    clear and convincing evidence with respect to the agency's
    regulatory agency and mandatory duties that a proposed decree
    is actually in the public interest. This would reduce the risk
    of collusion between regulators and special interests.
        Fifth is to restore accountability. Before the Government
    enters into a consent decree, the Attorney General or agency
    head for agencies with independent litigating authority should
    be required to approve it personally.
        Sixth, and finally, is flexibility. If the Government moves
    to terminate or modify a consent decree on the grounds that it
    is no longer in the public interest, the court should review
    that motion de novo under the same standard that I previously
    described.
        I should note that these recommendations are largely
    reflected in the Sunshine for Regulatory Decrees and
    Settlements Act. This bill is the most significant step forward
    in this area since Attorney General Meese's 1986 memorandum on
    the topic.
        Again, I thank the Committee for the opportunity to offer
    these remarks, and I look forward to your questions.
        [The prepared statement of Mr. Grossman follows:]

                                   __________
        Mr. Coble. Thank you, Mr. Grossman.
        Mr. Cruden, you are recognized for 5 minutes.

       TESTIMONY OF JOHN C. CRUDEN, PRESIDENT, ENVIRONMENTAL LAW
                               INSTITUTE

        Mr. Cruden. Thank you. Thank you, Mr. Chairman and Members
    of the Subcommittee, for inviting me to testify.
        I have prepared testimony, which I asked to be placed in
    the record. Attached to that testimony is a dozen examples of
    very recent consent decrees involving municipalities, some of
    them which were amended, which I thought were truly important
    for your consideration----
        Mr. Coble. Mr. Cruden, is your mic activated? You appear to
    be a little muffled.
        Mr. Cruden. I am on now.
        Mr. Coble. That is better.
        Mr. Cruden. Thank you.
        I am the president of the Environmental Law Institute. We
    do not lobby or litigate. We are an educational and research
    institution, dedicated to the rule of law.
        But before ELI, for 20 years, I led the Department of
    Justice's effort in environmental enforcement and environmental
    defense. And so, I have dealt with consent decrees every day of
    my life while I was there, and I want to speak from that
    perspective.
        And so, let me say at the outset, as an environmental
    person, two important things. Consent decrees are extremely
    important. They are important for the rule of law. They are
    important to get environmental guarantees, and you will see
    those in the dozen examples that I gave to you, and you should
    not add any obstacles to those consent decrees.
        And second, there are already mechanisms to get amendments
    to consent decrees: Rule 60 of the Federal Rules of Civil
    Procedure, which has been the law a long time, given the ways.
    The Supreme Court has spoken in numerous instances about how
    you apply Rule 60, making it clear that you give some deference
    to municipal authorities, but also making it clear that the
    burden is on those people trying to get out of a consent
    decree, as it should be.
        I have both legal and then just practical concerns based on
    my experience with consent decrees. Here are my legal concerns.
        First of all, there is already a mechanism in the law to
    change the Federal rules. If you look at 28 U.S.C. 2073, the
    Judicial Conference has the responsibility of looking at
    Federal rules. They have already amended Federal Rule 60 four
    times. That is the right way of going about changing a process
    like this.
        Second, any time you are starting to restrict the ability
    of Federal judges to act, particularly on things like their
    injunctive authority with regard to orders, you are really
    coming up to separation of powers issues, which I believe
    Congress should look very carefully at before acting.
        And then, finally, I actually think that H.R. 3041
    restricts the authority of Mayors. I think you are telling
    Mayors--``your decisions are time limited.'' They are sovereign
    authorities as well, and they deserve our respect.
        But let me provide some practical considerations. I gave
    you a number in my prepared testimony. I only want to single
    out a few.
        First of all, in my experience, consent decrees are
    actually hard to obtain. What you get for a consent decree you
    all know; finality and certainty. That is what you get. If you
    don't get finality and certainty, and if I was still at the
    Department of Justice, I would advise then don't do the consent
    decree. Just litigate to conclusion. Then you don't have to
    worry about somebody getting out of the consent decree 4 years
    later. But that is not good public policy.
        If you go down that route; if, in fact, you have what I
    predict, and that would be that consent decrees would not be
    used, then you have way more transaction costs. You will have
    way more attorney fees. Everything will also take a lot longer
    to do.
        There are other disadvantages. Native American groups are
    bringing some of these enforcement actions, it disadvantages
    municipalities, which I will get to in a second, and it
    disadvantages citizen groups that are also bringing these
    actions because they simply can't wait and see whether or not
    the municipality is really going to comply with the decree 4
    years later.
        Now let me say something quickly about municipalities. Many
    of the consent decrees that I gave you as my examples were
    consent decrees that took a long period of time because they
    were expensive. Mayors actually have to get funding. Any
    uncertainty makes it very difficult for them to get that
    funding.
        And on top of that, I don't think you want to tell Mayors
    in the United States: ``We don't trust you.'' We trust you, in
    fact, to have multiyear, multimillion dollar contracts, but we
    actually don't trust you to enter into consent decrees.
        Let me say something quickly about H.R. 3862. I actually
    think it also creates obstacles to resolution of litigation
    against the Federal Government, even when an agency is
    absolutely out of compliance with a congressional mandate.
        I strongly believe that adding more obstacles means you
    will have fewer consent decrees. We have found that judges
    actually give shorter timeframes, not longer timeframes for
    these type of actions. So an unintended consequence would be
    more litigation, and shorter timeframes.
        Let me sum up. Federally approved consent decrees are a
    valuable settlement tool that promote expeditious resolution of
    cases, save transaction cost, and achieve finality. Any
    necessary changes should be done through the process already
    established. I believe these two bills would effectively
    eliminate the use of consent decrees, undermine enforcement,
    and make resolution of litigation significantly more expensive
    and time-consuming.
        I look forward to any questions that you might have.
        [The prepared statement of Mr. Cruden follows:]

                                   __________

        Mr. Coble. Thank you, gentlemen, very much for your
    contributions to today's hearing.
        Now we try to comply with the 5-minute rule as well. So if
    you all will keep your responses terse, we would be
    appreciative to you for that.
        Mr. Martella, would H.R. 3862 procedures be effective in
    limiting abuses of consent decrees and settlement agreements to
    advance special interests' regulatory agendas, and why?
        Mr. Martella. Thank you, Mr. Chairman.
        I believe that H.R. 3862 would be a significant step in the
    right direction of addressing the concerns we have been talking
    about, that basically groups are working with the Government to
    reach settlement agreements kind of outside of the transparent
    public participation realm and effectively reallocating
    Government resources and priorities, working in something of a
    quasi-governmental function.
        The proposed bill would address all of those concerns by
    introducing a guarantee of public participation and
    notification of such agreements. By allowing the public to be
    part of that, and one of the ideas of the bill that I think
    should really be commended, the notion that if someone
    intervenes in one of the cases, they would have an opportunity
    to be at the settlement table with the mediator. And in my
    view, that will actually result in a better government because
    all the considerations will be accounted for in that settlement
    agreement.
        So, for a number of reasons, I think the bill would be a
    strong step in the direction of addressing those concerns.
        Mr. Coble. I concur with that.
        Would you say, Mr. Martella, that a significant number of
    important Federal regulations are promulgated under the sue and
    settle consent decrees and settlement agreements?
        Mr. Martella. I think every year it is a higher and higher
    percentage. The trend is definitely that the regulatory agendas
    of several agencies, the EPA in particular, seems to be driven
    as much by the influence of outside groups as it is by Congress
    and the agency's own priorities. This is becoming an increasing
    trend every single year.
        Mr. Coble. Thank you, sir.
        Mr. Schoenbrod, does H.R. 3041 go beyond the Supreme
    Court's decision in Horne, or does it simply clarify the rule
    that the court tried to articulate in that case?
        Mr. Schoenbrod. It clarifies the rule that the Supreme
    Court laid down in Horne. It clarifies the basic idea. The
    problem with Horne, the reason why Rule 60(b)(5) is not a
    workable mechanism for changing decrees is that Horne is so
    confusing in terms of how you actually implement the principle
    that protect rights, but yet give flexibility.
        In Horne itself, which was remanded to the District Court
    in 2009, there is yet to be a decision. And remember, the
    motion to modify the decree was started several years earlier.
    So you are talking 5, 6 years to get a change in public policy
    when life changes every day.
        There are literally thousands of these decrees and, in
    fact, only something less than 30 reported cases using Horne.
    We have a broken system, and there is nothing wrong with
    Congress fixing it directly.
        Congress, without the Judicial Conference, enacted the
    Prison Litigation Reform Act. It was upheld in French v.
    Miller. Congress could do that.
        Now, Mr. Cruden raises the issue of Department of Justice
    decrees in cases against State and localities. I think there is
    a different question when you have Department of Justice
    actions against States and localities.
        In cases like pollution control versus the kind of
    institutional reform cases that is the focus of the idea of the
    Prison Litigation Reform Act--excuse me, the Federal Consent
    Decree Fairness Act. And indeed, in a previous version of the
    bill, there was a carve-out for Department of Justice
    enforcement actions. That may be sensible to deal with the kind
    of concerns that Mr. Cruden raises. But otherwise, we need this
    bill.
        Mr. Coble. Thank you, sir.
        I am going to move along, trying to beat the House floor
    vote, which is imminent.
        I am going to recognize the distinguished gentleman from
    Tennessee, the Ranking Member, Mr. Cohen.
        Mr. Cohen. Thank you. Thank you very much.
        I think the genesis of a lot of this legislation came from
    Tennessee, and it was introduced by Senator Alexander. And it
    was a result of the TennCare case, which is our Medicaid, where
    there was a very bright, committed, and determined plaintiff's
    lawyer arguing on behalf of the poor, who had very little in
    the way of healthcare from a State that depends on the sales
    tax as its foundation for its budget, which makes it
    regressive, inadequate to have the monies to take care of the
    poor and yet drawn in such a way as to affect them in a most
    disadvantaged manner because it is regressive.
        And a Governor at the time who was a brilliant man, who is
    a healthcare expert, and thinks that nobody is better than him.
    And so, it set for a very difficult situation. And there was
    the immovable object and the irresistible force with Mr.
    Bonnyman and Governor Bredesen.
        The fact is, as I looked at it, and I understood the
    problems with the consent decree, there was really nobody
    speaking for the poor and the sick but Mr. Bonnyman. And there
    was a need for that consent decree, and that--the Governor
    didn't want to have it. He thought he knew how to do
    everything. He certainly didn't.
        As I look at this and I listen to Mr. Cruden, who has got
    all this experience, I just think that if you had a Governor
    like that or any Governor who didn't want to get into a consent
    decree and their term was going to come up, you would have
    attorneys on the defense side who would just engage in dilatory
    tactics to try to spread the thing out to get close as they
    could to the end of that Governor's term before they got to
    anything, and therefore, there would be nothing.
        And there really would be no incentive for the plaintiffs,
    who want to help the people that need healthcare to enter into
    a consent decree because it could be turned around at the end
    of the term or in 4 years, whichever comes first. So the loser
    in the case would always be speedy justice and the aggrieved
    party.
        I don't understand it. Mr. Cruden, maybe you could explain.
    These bills all, both of them, say that the plaintiff would
    have to come in and justify their actions. Why should it be
    that the folks who are citizens, who are aggrieved, who are
    being denied rights guaranteed them by their Constitution or
    their government and have been denied them, have to come back
    just because there has been a change in the leader?
        The factors that led to the deprivation of rights, doesn't
    it seem like the State, in its new incarnation with the
    election, should have to at least show why it is now some
    superior position and doesn't need to be chastised and
    reprimanded and forced to do what they should have done because
    of their wonderful spirit and souls?
        Why shouldn't it be the other way around, that the
    defendants have to come in and show the court why you don't
    need the consent decree? Doesn't it say that the plaintiffs
    have to come and prove that it has to be continued?
        Mr. Cruden. If you think about it, Congressman, in some
    ways consent decrees are like a contract. Everybody is coming
    together and having a contract that everybody did in good
    faith. Everybody made promises. Everybody said, ``I will live
    by this.''
        But the person that wants to get out of that contract ought
    to bear the burden of trying to show why that is appropriate.
    Why isn't that true now? If there are different circumstances,
    if there are different facts, if the world has changed, okay.
    But it ought to be the burden--just like every Supreme Court
    decision that has been mentioned says that. The burden is on
    the person trying to get out of the deal that at some stage
    somebody promised that they were going to do.
        Mr. Cohen. So why isn't that a better idea, Professor? You
    want--I see you are putting your finger to the mike. I
    appreciate your interest. Why isn't that a better idea than
    having the plaintiffs have to come forth, normally who have
    less resources and have to come in and show why justice should
    continue?
        Mr. Schoenbrod. Justice Brennan wrote that ``nothing would
    so jeopardize the legitimacy of our system of government that
    relies upon the ebbs and flows of politics to clean out the
    rascals''--that is in quotes--``than the possibility that those
    same rascals might perpetuate their policies simply by locking
    them into binding contracts.''
        Now, once the consent decree is entered, the judge has full
    power to use contempt to make the people that entered into the
    decree obey it. Now when it is the end of the term and you have
    got a new Governor coming or a new Mayor coming in, then the
    plaintiffs' lawyers have the ability to show the decree as
    still needed. And until the decree is modified, it is still
    enforceable.
        Most of these decrees have built into them provisions that
    require the defendants to give the plaintiffs all kinds of
    information, basically an ongoing discovery. Plus, there is
    discovery. So the plaintiffs and often the plaintiffs' lawyers
    have better--and I could tell you, I was in this position
    myself as a plaintiff lawyer--have better information than does
    the Mayor as to what is going on.
        So if there is a problem, the plaintiffs' lawyers ought to
    be able to show it. And when they can show it, the decree
    should stay in force, and it should be punishable through the
    power of contempt.
        Mr. Cohen. Well, my red light has gone off, but I am going
    to take this opportunity just to ask you. You are an NRDC alum,
    aren't you?
        Mr. Schoenbrod. Yes, I am, sir.
        Mr. Cohen. Are you a Keystone XL opponent?
        Mr. Schoenbrod. I think Keystone is a bad idea.
        Mr. Cohen. Good.
        Mr. Schoenbrod. I am against the pipeline.
        Mr. Cohen. Thank you, sir. Just checking.
        Mr. Coble. You worked that one in very cleverly, Mr.
    Tennessee. [Laughter.]
        I would be remiss if I didn't recognize Ray Smietanka, who
    used to be a longtime staffer. Ray, good to see you again.
        The distinguished gentleman from South Carolina, Mr. Gowdy,
    is recognized for 5 minutes.
        Mr. Gowdy. Thank you, Mr. Chairman.
        I want to thank you for your leadership on this
    Subcommittee, and I want to, given the hard work of my friend
    and colleague, the gentleman from Arizona, Mr. Quayle, I wanted
    to allow him to ask his questions first in light of the pending
    votes and because of his expertise in this area.
        So I would give my time to my friend from Arizona.
        Mr. Coble. The gentleman from Arizona is recognized.
        Mr. Quayle. Oh, I thank the gentleman from South Carolina,
    and thank you, Mr. Chairman, for holding this hearing, and for
    the witnesses for being here.
        During your testimony, Mr. Cruden, it was interesting that
    you brought up the fact that some of these bills might have a
    negative effect on Native Americans. And it is precisely the
    negative effect that some of these consent decrees have on the
    Native American community in Arizona, which is one of the
    interests that I have been in trying to solve some of these
    issues.
        More specifically, it was late last year that the EPA
    entered into a consent decree with the National Parks
    Conservation Association and eight other environmental
    organizations, and this consent decree would require the Navajo
    generating station to invest over $1.1 billion in emission
    control equipment or just shut down. This could cost hundreds
    of jobs for tribal members up in the northwest part of Arizona.
        And if it does go through, this is going to actually end up
    costing all Arizonans about a 20 percent increase in energy. So
    that there--you were mentioning some of the negative
    consequences for Native Americans, but there is also negative
    consequences for these consent decrees that they are adamantly
    opposed to because they haven't been able to get the right to
    actually comment on it in the public sphere.
        And so, if you could just address that really quickly?
        Mr. Cruden. I will. Of course, Native Americans in some
    instances are bringing the cases, and in some cases, the case
    is being brought against them.
        One misnomer about consent decrees, they don't go into
    court by themselves. They go in with a complaint. So there will
    be a complaint signed, in this case by a United States attorney
    probably, that lists all of the violations of law that exist.
    Then the complaint--then the consent decree resolves those
    violations by Department----
        Mr. Quayle. But a lot of the consent decrees----
        Mr. Cruden. Just one sentence. By Department of Justice
    policy----
        Mr. Quayle. I have very limited time, sorry. But a lot of
    these times where they are--actually, the complaint is filed at
    the same time that the settlement is filed as well. So you
    don't even get that day in court. It is actually just, hey, we
    have put the complaint in, and we have the settlement. So
    whoop-de-doo, these are all done behind closed doors.
        Mr. Cruden. In those cases, two things. In those cases,
    sometimes they are, and there might have been a year of
    negotiations. But in the instance that you are talking about,
    which would have been an enforcement action, by Department of
    Justice policy, the consent decree is public. There will also
    be public comment taken on it. The judge is only given the
    consent decree but not asked to make it final until after there
    is public comment on that enforcement action. That is being
    done right now at DOJ----
        Mr. Quayle. Right. Except the problem is that it is very
    limited in the public comment. It is much more limited than the
    normal regulatory process, as Mr. Martella talked about with
    the off ramp.
        But I want to get to Mr. Martella, especially since we both
    went to Vanderbilt Law School. So I really value your testimony
    here. But one of the things that--I want to get your take on
    this. One of the concerns that I have in some of these sue and
    settle agreements is that you have a certain private interest
    group that comes to Congress, lobbies for some statutory
    language to be put in. It is politically viable, but it sets a
    timeframe that is unrealistic in terms of being able to
    implement this.
        And that is where the sue and settlement comes into
    fruition because they are able to get it through because they
    have lapsed in the timeline, and they can go in and get a more
    stricter rule applied via that process. Do you think that this
    abuse is happening right now, and does the Sunshine Act
    actually help address some of those issues?
        Mr. Martella. I think it is happening a lot. I actually
    think, as someone who has been in a number of Federal agencies,
    that the pressure of having the deadlines that Congress sets,
    with limited resources, then the added pressure of having to
    rejiggle those priorities and those resources based on these
    settlements adds an entire new level of complexity because you
    only have limited resources.
        And if you have this deadline and all of a sudden, you have
    entered an agreement that says now the party has that deadline,
    first of all, the new deadline is probably unrealistic, as
    shown in a couple examples, but how are you going to meet the
    first deadline at the same time? So it really creates a total
    conundrum for these agencies with very limited resources and
    creates these outside influences on what the priorities really
    are.
        Mr. Quayle. Thank you.
        Mr. Grossman, I just wanted, along those same lines. You
    have--the Dodd-Frank bill was passed not too long ago. However,
    it is estimated that three-fourths of the rulemaking deadlines
    in Dodd-Frank have lapsed.
        Do you have concerns that there will be a spike in the
    current Administration entering into these agreements this year
    because of all the lapses within Dodd-Frank, and how will that
    have an effect on our financial system?
        Mr. Grossman. I am gravely concerned that we are going to
    see repeats of what we saw at the end of the Carter
    administration where the Administration entered into numerous
    consent decrees that for the next 8 years wound up tying the
    hands of the Reagan administration, which had a very different
    view and was, to some extent, unable to carry out its electoral
    mandate, was hobbled in that because of these consent decrees.
        In this sense, they undermine representative democracy, and
    that is very serious.
        Mr. Quayle. Thank you very much.
        Thank you, Mr. Chairman and the gentleman from South
    Carolina.
        I yield back.
        Mr. Coble. Thank you, Mr. Quayle.
        The distinguished gentleman from Georgia, Mr. Johnson, is
    recognized for 5 minutes.
        Mr. Johnson. Thank you, Mr. Chairman.
        Indeed, for the Koch brothers, things go better with the
    Keystone pipeline. And--it is on. Things go better with the
    Keystone pipeline. And so, Professor Schoenbrod, I am amazed
    that you would come in and say that you were opposed to the
    Keystone pipeline, especially when the Koch brothers are so
    intimately associated with the organization that you work for,
    the American Enterprise Institute.
        Mr. Schoenbrod. Well, to answer your question----
        Mr. Johnson. But let me move to Mr. Martella. Mr. Martella,
    you described yourself as an environmental lawyer, but in fact,
    it would be better to say that you are a corporate
    environmental lawyer. Is that true?
        Mr. Martella. My existing clients are corporations----
        Mr. Johnson. Well, I mean, yes, you started out at the law
    firm where you are situated now representing corporate clients,
    and then you went into Government with the Bush administration,
    correct?
        Mr. Martella. Actually, if I could correct that? I wasn't.
    I was a career civil servant for, I think, 11\1/2\ of my 13
    years of public service as general counsel and----
        Mr. Johnson. With the Bush administration, right?
        Mr. Martella. At the end of my career, yes. I was hired by
    the Clinton administration, promoted by the Clinton
    administration----
        Mr. Johnson. And of course, the Bush administration was not
    interested in any regulations whatsoever, and you were, when
    you say that you were an environmental lawyer, you were
    actually an anti-environmental lawyer, and you are still an
    anti-environmental lawyer, looking at your clients. And you
    represent a lot of corporate clients, both in litigation and
    strategy, advice, consultation, on how to get around the
    environmental regulations that Congress or that the EPA may
    enact through its rulemaking authority, pursuant to
    congressional legislation.
        And so, we appreciate you being here, but who is your
    client today?
        Mr. Martella. Well, I think----
        Mr. Johnson. Is it a business that you are representing, or
    is it a philosophy?
        Mr. Martella. I am here in my personal capacity. And I
    think I am really here----
        Mr. Johnson. So you are not getting--you mean to tell us
    that you are here and you are not on the clock, making $600,
    $700 an hour?
        Mr. Martella. I am not on any clock. I am actually very
    much thinking of my three children, who are 12, 8, and 5, and
    who, in my role as an environmental lawyer, is to make sure
    that when they grow up, they have a stronger environment than
    we have today.
        Mr. Johnson. Well, I know that they will have--they may
    even end up in the 15 percent tax bracket with the kind of
    moves that their daddy is making in the business world. And I
    appreciate that. I am a lawyer myself and represent various
    interests. So I am not speaking of you personally. I am just
    speaking of the interests that you represent.
        But, Mr. Grossman, you----
        Mr. Martella. And I think your stereotype is unfortunate.
        Mr. Johnson. Mr. Grossman, you are a graduate of George
    Mason University, correct?
        Mr. Grossman. Yes.
        Mr. Johnson. The law school. George Mason University Law
    School, a public university in Virginia that has received more
    than $30 million from the Koch brothers. And you are also
    familiar with the Mercatus Center, which is----
        Mr. Grossman. I believe it is Mercatus.
        Mr. Johnson. Mercatus? Yes, you are familiar with it. And
    its goal is to deal with how institutions affect the freedom to
    prosper. That is----
        Mr. Coble. Mr. Johnson, would you suspend just for a
    moment?
        Mr. Johnson. I will, without waiving any time.
        Mr. Coble. Well, you seem to be going far afield here. If
    you could confine it to the issue at hand.
        Mr. Johnson. Well, you know, it goes to the credibility of
    these three witnesses, all of whom have connections to the Koch
    brothers, and we have got--I mean, this is not the first
    hearing where this has happened, where we have had a full
    monty, if you will, of Koch brothers-influenced lobbyists. And
    I think you are a lobbyist, too, aren't you, Mr. Grossman?
        Mr. Grossman. No, I am not. And let me add----
        Mr. Johnson. You are not a registered lobbyist?
        Mr. Grossman. No, I am not. I have not engaged in any
    lobbying activity ever, so far as I am aware.
        Mr. Johnson. But the Mercatus Institute, you are a product
    of that?
        Mr. Grossman. I have never even set foot in the Mercatus
    Institute. You are alleging that my connection with the Koch
    brothers is that I attended a law school----
        Mr. Johnson. Don't the Koch brothers donate money to George
    Mason University?
        Mr. Grossman. Pardon?
        Mr. Johnson. Koch brothers donate money to George Mason
    University?
        Mr. Grossman. Who donated money to your university? Beats
    me.
        Mr. Johnson. Do they maintain editorial control over what
    comes out of that university's think tanks?
        Mr. Grossman. I don't even know what that would mean in a
    university setting, and I was a student at the university,
    rather than an employee or a lobbyist or of its think tanks.
        Mr. Johnson. Well, you grew up in that environment, and you
    are a reflection of that environment in your professional role
    here today. And that is the point that I want to make.
        Thank you.
        I will yield back.
        Mr. Coble. Mr. Martella, I may be wrong. I may be
    inaccurate in this, but you worked with the Clinton and the
    Bush administration, did you not?
        Mr. Martella. Thank you, Mr. Chairman.
        Yes, I was hired by the Clinton administration. I was
    actually promoted by the Clinton administration. And as I
    mentioned, I was very proud to be a career civil servant for
    virtually the entirety of my career, and I was unanimously
    confirmed by the United States Senate, with the support of
    Barbara Boxer and Senator Obama at the time.
        Mr. Coble. Well, thank you, sir.
        Mr. Cruden. Congressman, I would ask a point of personal
    privilege.
        Mr. Coble. Yes, sir.
        Mr. Cruden. Mr. Martella and I may not agree on the impact
    of H.R. 3862, but I have known this gentleman for 15 years. He
    is a man of great integrity and is a great environmental
    person.
        Mr. Coble. Well, and I stand by my opening statement when I
    said we were blessed with an outstanding panel, and I included
    all four of you.
        Now let me shift my weight to my right. Mr. Quayle, I think
    procedurally, you are up next even though the gentleman from
    South Carolina yielded to you earlier. Mr. Ross, is that----
        Mr. Quayle. Since the gentleman from South Carolina yielded
    to me, I will yield to the gentleman from South Carolina.
        Mr. Coble. And if the gentleman will suspend? Folks, it
    looks like we may be paying the preacher in this case because I
    think we are going to beat that floor vote. So if you all will
    proceed, Trey, you are recognized for 5 minutes.
        Mr. Gowdy. Thank you, Mr. Chairman.
        I thank the gentleman from Arizona.
        I am actually not going to ask the questions that I had
    drafted to ask. I will submit those in writing.
        Instead, I am going to do something which often isn't done
    in congressional Subcommittees, which is ask a question and
    then not interrupt the person while they are trying to answer
    it. So, Mr. Martella, take a minute and say whatever you would
    like to say, given the fact that your credibility was
    unsuccessfully impeached.
        And then, after that, Mr. Grossman, you take a minute and
    you say whatever you want, given the fact that your credibility
    was unsuccessfully impeached.
        Mr. Martella. Well, thank you, Congressman. And I
    appreciate the opportunity.
        I think the one reaction I would have is I think
    stereotypes are always unfortunate, and it seems like there was
    a suggestion of a stereotype that because I work for a law firm
    today and because I represent corporations that, therefore,
    necessarily I don't care about the environment.
        And I think nothing could be farther from the truth. I have
    always seen myself as an environmentalist. Of my 15-year
    career, 12 were spent as Government civil servant doing that.
    And today in my job what I am very proud of, despite the
    stereotypes, is I don't just represent corporations in a way to
    skirt the law. What I do is I work with corporations to find
    ways to comply with the laws and help ensure that we have
    solutions that incorporate a wide range of stakeholders,
    including environmental groups, including the Government.
        I would estimate in half of the cases I have in court, I am
    actually defending the EPA on behalf of corporations. It is the
    environmental groups who might be challenging something at the
    EPA, and we are actually defending the Obama administration
    EPA. And I am proud of the fact that in half of the cases, we
    are on that side.
        I mentioned as the father of three children, my overriding
    concern in my day-to-day job is that we have a better
    environment for them than we do for ourselves today. And I
    think anyone who is a father or mother here would agree with
    that.
        So, again, if I could help perhaps address those
    stereotypes today or at some other point in the future, I would
    be happy to do so, but thank you for giving me that
    opportunity.
        Mr. Gowdy. Thank you, and thank you for being here.
        All the witnesses, whether I agree with them or not, are
    doing us a courtesy and a favor by loaning us their expertise.
        And Mr. Grossman, Professor, in fairness to you, you wanted
    to answer a question. Given the fact you don't support
    Keystone, I am going to give the remainder of my time to a guy
    I know that does, Mr. Quayle. [Laughter.]
        So after you go, Mr. Grossman, I am going to give the time
    back to my friend from Arizona.
        Mr. Grossman. Thank you.
        Mr. Coble. Mr. Grossman, if you would suspend just a
    minute?
        I want to commend the gentleman from South Carolina and the
    gentleman from Tennessee for very cleverly having inserted this
    issue into the dialogue.
        And Mr. Cruden, thank you for your comment as well earlier.
        Mr. Grossman?
        Mr. Grossman. I don't feel the need to respond directly to
    baseless ad hominem attacks. I think my work speaks for itself,
    but thank you.
        Mr. Gowdy. Very well. I would give the remainder of my time
    to the gentleman from Arizona, Mr. Quayle.
        Mr. Quayle. Thank you very much.
        And I want to echo what the gentleman from South Carolina
    said, that we have an excellent panel. We might not agree on
    everything, especially the Keystone pipeline, but they do
    provide their expertise and their knowledge to all of us so
    that we can make more informed decisions on the type of
    legislation that we need to move forward.
        So now that we have gotten past one of the favorite
    bogeymen of the Koch brothers and we can get back to the issue
    of these two pieces of legislation, it would be great to talk
    about, Mr. Grossman, you mentioned the Meese memo.
        And there was a lot of talk in the written testimony about
    the Meese memo. Do you have any concerns with the Meese memo,
    or do you think that anything within the Meese memo that was
    not put in or the ideas that in H.R. 3862 could be incorporated
    to make it a stronger and better bill?
        Mr. Grossman. Thank you.
        I think the Meese memorandum was really a path-breaking way
    of looking at this problem. It identified a problem that
    certainly the legal academy and a lot of practitioners did not
    realize before, and it really is the definitive statement in
    this area.
        I think the bill appropriately incorporates the provisions
    of the Meese memorandum in that it would be inappropriate from
    potentially a constitutional point of view, but probably from a
    policy point of view for Congress to limit in the way the Meese
    memorandum does the executive branch's settlement authority.
        But I think that the legislation takes a much more
    thoughtful approach by using the Meese memorandum as a basis to
    judge which types of settlement agreements and consent decrees
    raise special concerns that require high-level authority and
    high-level discretion to execute. I think that is exactly the
    right approach, and I commend the authors of the bill for
    taking it. It is the right way to do it.
        Mr. Quayle. Okay. Thank you.
        And Mr. Martella, I am a new father as well, and I want the
    environment to be better than it is now. And I think that you
    might agree that environmental stewardship and economic growth
    are not mutually exclusive.
        And one thing I want to know about the sue and settlement
    agreements, have they been happening more or less on major
    rulings rather than minor ones? I just want to get your sense
    as where they actually are occurring.
        Mr. Martella. I think it is across the board. I think they
    are more publicized when it is on major rulemakings, and the
    impacts are more significant. But I think we are seeing in a
    wide range of settlements.
        And again, my point here today is not to suggest the
    Government shouldn't settle these cases. I strongly advocate
    settlement over litigation in virtually every instance.
        To me, what is important is getting all the stakeholders
    around the table. It is transparency, public participation,
    judicial review. These are the bedrock principles of our
    democratic system, and I am only here to say that we should be
    enforcing these principles and guaranteeing protection for
    them.
        Mr. Quayle. Great. Thank you very much.
        I yield back.
        Mr. Coble. Thank you, Mr. Quayle.
        And finally, the distinguished gentleman from Florida, Mr.
    Ross, is recognized.
        Mr. Ross. Thank you, Mr. Chairman.
        Mr. Coble. You have been very patient, Mr. Ross.
        Mr. Ross. Oh, I have been enjoying this. Unfortunately, it
    hasn't been a very nice process to my State, the great State of
    Florida.
        You know, and it is what these consent decrees, what I call
    ``regulation by litigation.'' It seems to me that it would be
    almost easier to have regulatory agencies encourage the sue and
    settle so that they could circumvent the regulatory hearing
    process to enter into consent decrees with third parties that
    don't involve the actual affected parties.
        And Mr. Cruden, I appreciate your analysis and, in fact,
    believe that, empirically speaking, consent decrees work the
    way you have testified. However, from a personal perspective
    and from a practical perspective, dealing in my State
    specifically with numeric nutrient water criteria, that has not
    been the case.
        In fact, you may be familiar with this particular issue
    because, pursuant to the 2003 Clean Water Act, my Department of
    Environmental Protection in the State of Florida began doing
    their own numeric--well, quantitative water analysis. We are
    surrounded by water on all three sides. We have got a lot of
    inland water, and we know that clean water is important not
    only to our health and livelihoods, but also to our business
    and to the commerce of our State.
        So DEP is going about trying to provide their own water
    standards, and all of a sudden, Earthjustice comes along, files
    suit against the EPA, and says, ``Look, they are not going fast
    enough. We want this taken care of.''
        And then what happens? Well, absent the State of Florida
    being involved in a consent decree negotiation, absent the
    interveners being involved in the consent decree negotiation,
    suddenly, a consent decree is issued that impacts my State
    economically that will cost over 14,000 jobs, that its capital
    costs on municipal wastewater plants will exceed $21 billion.
        Estimated costs of anywhere between $3.1 billion to $8.4
    billion over the next 30 years to comply. And what we have
    seen, Mr. Cruden, is not that we are telling Mayors that we
    don't trust them, but what we are telling my State Department
    of Environmental Protection is that we don't trust them.
        And it seems to me that we have circumvented, as Mr.
    Grossman indicated, the public notice and comment process. What
    would be wrong, what would be wrong for requiring not only
    transparency, but also that all parties come to the table and
    be engaged in the consent decree process?
        Mr. Cruden. One of the things, and I think, by the way, I
    am not involved in that case. But I certainly was involved in
    the Florida Everglades consent decree----
        Mr. Ross. Yes, sir.
        Mr. Cruden. And that has another history of going through
    modifications, attempted modifications. But we probably would
    not be where we are today with that great natural resource,
    which I am sure you would agree, without what was done by the
    State in that decree.
        But I think one of the things we are losing sight of is
    that these consent decrees, whether or not they are for
    rulemaking, for anything else, are because there is somewhere a
    mandatory duty and a violation of the law. I have seen
    countless cases, countless cases, where I was on the receiving
    end, where some group--by the way, could be a corporation--
    saying an agency was supposed to have a rule and they haven't
    done so for 10 years.
        Mr. Ross. But we were in the process. We were in the
    process.
        Mr. Cruden. But my point is they are already violating the
    law, and so the consent decree in those cases sometimes is
    only----
        Mr. Ross. Violating according to who? I mean, the unique
    perspective of the State of Florida is that we are the only
    peninsular State, that we have natural water resources that are
    more abundant and more precious than most other States, with
    all due respect.
        But our livelihood depends on it. Who would know better
    than us, whose livelihoods depend on these natural resources,
    than how to maintain them and keep them clean? And here we are,
    being expedited in a process by a third party without the
    transparency.
        Mr. Cruden. I can't speak at all because I just simply
    don't know the individual case that you are mentioning. I don't
    doubt that it is important. Most of these consent decrees,
    however, that go to rulemaking, which is what we are talking
    about with this legislation, the rulemaking itself has notice
    and comment, has an opportunity to be heard. And if people are
    not happy with the end result, there is an opportunity to fully
    challenge it in court.
        Mr. Ross. Well, if they challenge----
        Mr. Cruden. That exists also under the Administrative
    Procedure Act.
        Mr. Ross. And you also indicate that you can modify it, but
    you have to show a significant change in circumstances that
    warrants the revision. Absent having all the parties at the
    table at the time the consent decree is issued, seems to me
    that meeting the burden of a significant change in
    circumstances is going to be much harder and not equitable.
        But let me move on real quickly. I want to go to an issue
    of standing. One of the issues that I think is very important
    is if we are going to have third parties enter into these
    settle and sue procedures, should we not address the issue of
    standing? Should they not have some sense of standing that they
    are affected by the actual regulatory rule that is being
    promulgated?
        And Mr. Martella, I will start with you. I know I am out of
    time, though.
        Mr. Martella. Well, I think standing is a critical issue on
    both sides, and I think one of the concerns--if I could perhaps
    even rephrase the concern from my perspective, is the lack of a
    level playing field. Even if the environmental groups do have
    standing, there are other affected parties who have standing,
    too. If it is a rulemaking, there may be trade associations or
    other groups that are affected by it, but they don't have the
    same standing at the table with the Government when it comes to
    these negotiations.
        I would argue that if you are going to look at the standing
    of one party, because they are impacted by something, you have
    to look at the standing of all the parties who are impacted,
    bring them to the table. And frankly, that is exactly what the
    Sunshine Act does.
        Mr. Ross. Thank you.
        I see I am out of time. Mr. Chairman, thank you.
        Mr. Coble. Thank you, Mr. Ross.
        Gentlemen, this is the first step of subsequent steps to
    follow, an important hearing, and I thank the Members of the
    Subcommittee for their attendance.
        I thank each of the four witnesses for your contribution
    through your testimony today.
        Without objection, all Members will have 5 legislative days
    to submit to the Chair additional written questions for the
    witnesses, which we will forward and ask the witnesses to
    respond as promptly as they can so that their answers may be
    made a part of the record.
        Without objection, all Members will have 5 legislative days
    to submit additional material for inclusion in the record.
        With that, again thank the witnesses, and this hearing
    stands adjourned.
        [Whereupon, at 10:43 a.m., the Subcommittee was adjourned.]

                                A P P E N D I X

                                  ----------

                   Material Submitted for the Hearing Record

     Prepared Statement of the Honorable Steve Cohen, a Representative in
    Congress from the State of Tennessee, and Ranking Member, Subcommittee
                  on Courts, Commercial and Administrative Law

        The debates that this Subcommittee has engaged in during this
    Congress often veer into abstractions.
        But what can get lost in the back-and-forth about the proper scope
    of Federal power, states rights, separation of powers, checks and
    balances, judicial activism, and political accountability is the fact
    that how we come out on these important questions can have a tremendous
    impact on ordinary people's lives, for good or ill.
        I hope that we keep this reality the central focus as we consider
    H.R. 3041, the ``Federal Consent Decree Fairness Act,'' and H.R. 3862,
    the ``Sunshine in Regulatory Decrees and Settlements Act of 2012.''
        Consent decrees are an important means by which plaintiffs can seek
    to remedy violations of Federal rights by state and local governments.
    They can also be used to ensure that Federal agencies are meeting the
    mandates set for them by Congress.
        Consent decrees, therefore, are commonly used to resolve a wide
    variety of cases involving civil rights, voting rights, disability
    rights, and environmental protection, among other things.
        Consent decrees can benefit both plaintiffs and defendants by
    allowing for timely resolution of disputes without the risks and costs
    associated with prolonged litigation.
        Defendants can also avoid determinations of liability and the risk
    that a costly or cumbersome solution simply will be imposed on them
    should they lose the suit.
        Moreover, the use of consent decrees in Federal court litigation is
    in keeping with the broader judicial and Congressional policy of
    encouraging settlement.
        I have no doubt that, as with anything else, not all consent
    decrees are perfect. If I think long enough about it, I might even
    think of a few that would give me pause as to their continued
    usefulness or necessity.
        I also have no doubt that the proponents of these bills, including
    Rep. Jim Cooper, my esteemed fellow Tennessee Democrat and sponsor of
    H.R. 3041, are sincere in their belief that these bills will achieve a
    better balance in the way consent decrees are used.
        Still, I have concerns about both bills that I would like the
    proponents of these bills to address.
        To begin with, H.R. 3041 would seem to have the effect of
    discouraging consent decrees against state and local governments and
    officials.
        The bill would allow state and local government defendants to seek
    modification or termination of a consent decree after four years from
    the entry of the decree or the term of office of the highest official
    who is a party to the decree ends, whichever is earliest.
        Additionally, the bill places the burden of proof on plaintiffs to
    prove the continuing need for the consent decree.
        In light of these provisions, I cannot think of why a plaintiff
    would ever agree to settle a case. It would seem to me that, rather
    than facing the prospect of having to re-argue in favor of a consent
    decree every few years, a plaintiff would simply press on with
    litigation.
        Also, to the extent that a consent decree is overly burdensome or
    has outlasted changed circumstances, it is not clear to me why
    modification of the decree pursuant to Federal Rule of Civil Procedure
    60 is not a sufficient remedy.
        Moreover, the Supreme Court in Frew v. Hawkins set out what appears
    to be a fairly liberal standard for granting modification or
    termination requests by state and local government defendants. Also,
    the Court seemed to go to great lengths to emphasize that Federal
    courts must respect state and local prerogatives and principles of
    federalism when considering whether to modify or terminate a decree.
        H.R. 3862, meanwhile, seems like it is designed to impede Federal
    rulemaking and other regulatory action, much like the regulatory
    legislation we considered last year.
        This bill would apply to consent decrees and settlement agreements
    that require Federal agency action that affects the rights of private
    third parties.
        For such consent decrees and settlement agreements, the bill
    imposes a number of procedural requirements on both agencies and
    courts. These include requiring agencies to solicit and respond to
    public comments on such proposed decrees and agreements and providing
    opportunities for third parties to intervene in the underlying action
    and the consent decree process.
        These provisions and others in the bill would seem to needlessly
    slow down agency action and open the door wide open to almost anyone
    who wants to impede agency action, including the promulgation of
    important public health and safety rules.
        I would also like to know from John Cruden, one of our witnesses
    today, whether, based on his 20 years of experience negotiating consent
    decrees as a career Justice Department official representing the
    government as both plaintiff and defendant, he believes that H.R. 3862
    addresses a real problem.
        I thank the witnesses for their participation in today's hearing
    and look forward to their testimony.

    Prepared Statement of the Honorable John Conyers, Jr., a Representative
     in Congress from the State of Michigan, and Ranking Member, Committee
                                on the Judiciary

        The two bills before us today--H.R. 3041, the ``Federal Consent
    Decree Fairness Act,'' and H.R. 3862, the ``Sunshine in Regulatory
    Decrees and Settlements Act of 2012''--appear intended to make it
    easier to modify or terminate consent decrees, to make it more
    difficult to enter into them, and to generally discourage their use.
        These bills threaten to undermine a key tool in guaranteeing the
    rights and protections that Congress has enacted over the last two
    generations.
        These include Federal civil rights and environmental laws that are
    designed to protect ordinary people who are victims of racial
    discrimination, voter intimidation, police brutality, or toxic
    pollution.
        A consent decree is a voluntary settlement agreement between
    plaintiffs and defendants that is entered by a court and is enforceable
    as a court order. Consent decrees are often used to settle public law
    and institutional reform litigation.
        By reducing costly and time-consuming litigation, consent decrees
    and settlement agreements benefit both plaintiffs and defendants.
        They help to ensure that Federal protections are enforced while
    leaving flexibility for governmental defendants as to how they will
    carry out their Federal obligations.
        Given these benefits, I am troubled by the effect that these bills
    may have on consent decrees and settlement agreements.
        First, H.R. 3041 will virtually eliminate all consent decrees
    against state and local governments by imposing an effectively
    unworkable time limit on their duration.
        Under this bill, a defendant may file a motion with a court to
    modify or terminate a consent decree at the earliest of either 4 years
    after the decree is entered or when the term of office of the highest
    ranking official who is a party to the decree ends, which could be less
    than 4 years.
        Moreover, the bill places the burden on the plaintiff to prove that
    there is a continuing need to have the consent decree in force without
    modification or termination.
        Taken together, these provisions would force a plaintiff to re-
    litigate its case against a state or local defendant every few years.
        Given that prospect, no plaintiff would ever agree to enter into a
    consent decree with a state or local government defendant. Rather,
    plaintiffs would simply continue to press on with litigation, adding
    great expense to American taxpayers and uncertainty for all parties
    involved.
        Also, many consent decrees are designed to reform institutions like
    prisons, police departments, child welfare agencies, and education
    systems. Revisiting consent decrees well before they have a chance to
    fully be implemented would simply short-circuit institutional reform
    efforts.
        And, it could encourage state and local governments to drag their
    feet in complying with such decrees in order to effectively ``run out
    the clock.''
        Second, H.R. 3862 is yet another attempt to prevent Federal
    regulatory actions from being implemented.
        When a Federal agency defendant is sued because of a failure to
    take regulatory action, it is often because the agency has missed
    statutory deadlines for taking such action, often by years.
        Consent decrees and settlement agreements can help assure that the
    agency takes such action by a date certain.
        H.R. 3862, however, would needlessly slow down the process by which
    such consent decrees are entered.
        This bill imposes an extensive series of burdensome requirements on
    agencies that seek to enter into consent decrees or settlement
    agreements.
        For example, it mandates that agencies provide for public comment
    on a proposed consent decree and requires agencies to respond to all
    such comments before the consent decree can be entered in court.
        In the case of consent decrees concerning rulemaking, an agency
    would be forced to go through two public comment periods, one for the
    consent decree and one for the rulemaking that results from the consent
    decree, doubling the agency's effort.
        Moreover, the bill would allow an unlimited number of third parties
    to intervene in the consent decree process, further delaying the entry
    of a consent decree.
        Like the anti-regulatory bills we considered last year, this bill
    piles on procedural requirements for agencies and courts.
        Also, like last year's anti-regulatory bills, this bill threatens
    to open the door to dilatory litigation tactics by interests that are
    hostile towards regulatory protections.
        Third, neither bill is necessary. They clearly are solutions in
    search of a problem.
        For instance, Federal Rule of Civil Procedure 60 already allows
    state and local government defendants to seek court authorization to
    modify or terminate a consent decree.
        Rule 60 requires a court to revisit its decrees when changed
    circumstances would merit modifying or terminating the decree.
        Moreover, as the Supreme Court made clear in Frew v. Hawkins,
    Federal courts must be deferential to state and local government
    prerogatives when considering whether a consent decree should be
    modified.
        Viewed together, it is clear that the standard for modifying or
    terminating consent decrees against state and local governments is a
    fairly liberal one.
        Accordingly, the burden on state and local governments seeking
    modification or termination does not warrant a legislative response.
        With respect to H.R. 3862, it is not clear what, exactly, is the
    problem that it is trying to address. My understanding is that most
    lawsuits and consent decrees against Federal agencies that seek some
    sort of regulatory action simply seek to ensure that the agency meets
    its existing statutory obligations. How that raises transparency
    concerns is beyond me.
        H.R. 3862 also codifies certain guidelines, first issued by
    Attorney General Edwin Meese nearly 30 years ago, for government
    attorneys to follow when determining whether or not to enter into
    consent decrees and settlement agreements.
        For example, government attorneys may not enter into consent
    decrees that would make mandatory an agency's discretionary authority
    to promulgate or amend a rule, nor may they agree to an obligation to
    seek funding from Congress to implement a consent decree.
        These guidelines have been incorporated into the Code of Federal
    Regulations since Attorney General Meese issued them.
        So I must ask: why do we need to codify them? Is there any evidence
    that these guidelines are not already being followed?
        Consent decrees are a vital instrument for enforcing Federal rights
    and protections. I fear that the bills before us today will discourage
    their use and, therefore, undermine the effective protection of Federal
    rights.

       Response to Post-Hearings Questions from Roger R. Martella, Jr.,
                               Sidley Austin LLP

      Response to Post-Hearings Questions from John C. Cruden, President,
                          Environmental Law Institute