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On September 2, 2014, a United States District Court for the Western District of Texas ordered that the Sierra Club reimburse Energy Future Holdings Corporation and Luminant Generation Company $6.4 million in attorneys fees for filing what the court described as a "frivolous" Clean Air Act (CAA) lawsuit. See Sierra Club v. Energy Future Holdings Corporation (W.D. Tex. Aug. 29, 2014). In its complaint, the Sierra Club alleged that the defendants' coal-fired power plant was in violation of the CAA's particulate and opacity limits and sought $330 million in civil penalties and $140 million in pollution control upgrades. The court granted partial summary judgment in favor of defendants, determining that there were no particulate emission violations at the power plant. Then, after a three day bench trial, the court concluded that there also were no opacity violations at the power plant. In its memorandum opinion, the court determined that an award of costs of litigation, including attorneys' fees, was warranted pursuant to 42 U.S.C. §7604(d).
42 U.S.C. § 7604(d) provides that a court, in issuing any final order under the citizen suit provisions of the CAA, may award litigation costs if it determines such an award to be appropriate. Here, the District Court relied upon the United States Supreme Court's decision in Christianburg Garment Co. v. EEOC, 434 U.S. 412, 422 (1978) to conclude that an award of litigation costs to prevailing defendants is appropriate where a plaintiff's claims were "frivolous, unreasonable, or groundless, or that the plaintiff continued to litigate after it clearly became so."
In concluding that a fee award was appropriate, the District Court noted the following:
Here, Defendants were successful against all of Plaintiff's claims. Plaintiff was unable to show a prima facie case of a [particulate matter] violation, and the claim was dismissed at the summary judgment stage of litigation. Plaintiff was aware that Big Brown's Title V permit exempted it from [particulate matter] deviations during maintenance, startup, or shutdown activities prior to filing suit, which rendered the claim meritless. And at trial, Plaintiff failed to prove any causation or injury to its lone standing witness or any other individual. Moreover, the one standing witness in the case was not even placed on Plaintiff's witness list even with the awareness that proving causation and linking the opacity violations at issue to injuries was required in order to prevail. Additionally, despite Plaintiff's knowledge that EFH had no role in the ownership or operations of Big Brown, it persisted in keeping EFH as a Defendant in the lawsuit. Even prior to the filing of the lawsuit, the TCEQ, who are experts in this field, had previously documented through its investigation reports that there were no [particulate matter] or opacity violations of the CAA at Big Brown. Defendants informed Plaintiff that these reports cannot be undermined. But even with this knowledge at its disposal, Plaintiff admitted that they failed to analyze or investigate the TCEQ investigation reports and filed suit. Consequently, after immense discovery, expense, and use of judicial resources, this Court found no evidence supporting any deficiency in the TCEQ's investigation reports. The evidence at trial, however, did reveal that during approximately 98.5 percent of the time that Big Brown was under normal operations, the opacity was generally 10 percent or less—far below the 30 percent limit. Moreover, each and every one of the opacity events that triggered a TCEQ investigation report found that an affirmative defense pursuant to the Texas Administrative Code was satisfied.
As such, the court concluded that plaintiff's claims were frivolous, unreasonable and groundless and therefore awarded defendants the sum of $6,446,019 in attorneys' fees, expert witness fees and costs from the Sierra Club. The Sierra Club has indicated that it intends to appeal this decision.