Wednesday, September 7, 2011

Sierra Club v. Khanjee Holding

Aug 24: In the U.S. Court of Appeals, Seventh Circuit, Case No. 09-4008. Appealed from the United States District Court for the Southern District of Illinois. The case is a successive appeal. The original defendants wanted to build a power plant in southern Illinois. In the first appeal, the Appeals Court concluded that the defendants' Prevention of Significant Deterioration (PSD) permit, which they needed in order to build the power plant, had expired. The Appeals Court held that it was proper for the district court to grant summary judgment in favor of plaintiff Sierra Club and to enjoin the defendants from engaging in further construction activities until they obtained a new permit.
    After the first ruling, the district court assessed a penalty of $100,000 on all of the defendants, jointly and severally, and awarded attorneys' fees to Sierra Club. Defendant Khanjee Holding then appealed that decision. In this appeal, Khanjee contends that the district court lacked subject matter jurisdiction. But the Appeals Court said, "we already determined in the previous appeal that the district court had subject matter jurisdiction, and there is no reason to revisit that ruling."
    Khanjee also argued that the district court assessed penalties and fees in violation of Khanjee's constitutional rights. On that argument, the Appeals Court said, "We find, however, that Khanjee waived its constitutional arguments by not raising them before the district court." Finally, Khanjee contended that the district court committed error when it weighed the requisite statutory factors. The Appeals Court said, ". . .we conclude that the district court did not abuse its discretion. The court considered all of the relevant statutory factors and did not make any clearly erroneous findings of fact in assessing a penalty and awarding fees. We affirm."
    The Appeals Court explained further that, ". . . the district court did not abuse its discretion in concluding that Sierra Club was successful on the merits and performed a public service consistent with the Clean Air Act's goals. An award of fees was therefore proper. Western States Petroleum Ass'n v. E.P.A., 87 F.3d 280 (9th Cir. 1996), cited by Khanjee, is distinguishable. In that case, the Ninth Circuit described the party that was denied fees as 'a financially able, nongovernmental party having no more than its own economic interests at stake.' Id. at 286. The court also found that the litigation had not served the public interest. Id. Here, Sierra Club did not receive any direct financial benefit from the lawsuit, and it served the public interest. Increased charitable donations are collateral benefits not contemplated by Western States. That Sierra Club may be a well-funded organization does not preclude an award of fees. There is nothing in the Clean Air Act that suggests that fees can only be awarded to indigent parties."
    Access the complete opinion (click here). [#Air, #Energy/Coal, #CA7]

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