Reversing a Court of Appeals decision that had been hailed by industry as a welcome corrective to the proliferation of citizen suits, the United States Supreme Court found that such suits could be pursued even when no environmental harm resulted from the violation. The case was Friends of the Earth v. Laidlaw Environmental Services, Supreme Court Case No. 98 - 822 (January12, 2000). Moreover, citizens can sue even when the only remedy that can be granted is the payment of civil penalties to the United States Treasury.
"A defendant's voluntary cessation of allegedly unlawful conduct ordinarily does not suffice to moot a case. The Court of Appeals also misperceived the remedial potential of civil penalties. Such penalties may serve, as an alternative to an injunction, to deter future violations and thereby redress the injury that prompted a citizen suitor to commence litigation."
The majority opinion written by Justice Ginsberg first addressed the question of initial standing by the citizen's group. Defendant Laidlaw argued that because the District Court found that there was no environmental harm from the discharge there should be no standing. The Court disagreed and cited several instances of testimony by members of the citizen's group that they had foregone opportunities to use the river for fishing, swimming and boating because of the discharges. The Court found these to be actual injuries in fact to the group, which it said was the correct standard to be applied. "We have held that environmental plaintiffs adequately allege injury in fact when they aver that they use the affected area and are persons 'for whom the aesthetic and recreational values of the area will be lessened' by the challenged activity."
The Court addressed the issue of whether the citizen's group lacked standing because the only remedy available to them was civil penalties which would be paid to the United States Treasury. The request for injunctive relief had been dismissed. The defendant cited Steel Co. v. Citizen's for Better Environment, 523 U.S. 83 (1998), which held that citizen's groups could not have standing to seek civil penalties for violations that were abated by the time the suit was filed. Here there were continuing violations after the filing of the complaint and the Court found that to be sufficient to distinguish the Steel Company case.
In short, Steel Co. held that private plaintiffs, unlike the Federal Government, may not sue to assess penalties for wholly past violations, but our decision in that case did not reach the issue of standing to seek penalties for violations that are ongoing at the time of the complaint and that could continue into the future if undeterred.
The Court found that the deterrent value of civil penalties even though paid to the U.S. Treasury were a sufficient benefit to the plaintiffs to give them standing.
It can scarcely be doubted that for a plaintiff who is injured or faces the threat of future injury due to illegal conduct ongoing at the time of suit, a sanction that effectively abates that conduct and prevents its recurrence provides a form of redress. Civil penalties can fit that description too. To the extent that they encouraged defendants to discontinue current violations and deter them from committing future ones, they afford redress to citizen plaintiffs who are injured or threatened with injury as a consequence of ongoing unlawful conduct.
The Court then addressed the question of mootness. It first distinguished mootness from standing by recognizing that a situation where there was no threatened injury impending would prevent standing, while after initial standing has been obtained, the case will not become moot unless "it is absolutely clear the allegedly wrongful behavior could not reasonably be expected to recur." The Court found that the District Court's refusal to grant an injunction did not mean that there was no prospect of future violations for civil penalties to deter. In fact the District Court, had expressly based its award of civil penalties on the need for deterrence. After the Court of Appeals' decision, Laidlaw had permanently closed its facility. The Court, however, refused to decide whether the case was moot, pointing out that Laidlaw retained its NPDES permit. The Court remanded to the District Court the question of mootness to decide disputed factual issues on whether it was absolutely clear that violations could not reasonably be expected to recur.