AEP Settlement Reveals New EPA Enforcement Model Regarding Global Climate Change

(PRLEAP.COM) This week the EPA announced a stunning $4.6 billion settlement with American Electric Power (AEP), one the few remaining targets of acid rain enforcement. The news of the largest settlement ever reached in a case pursued by the EPA was lauded by the government and environmental advocacy groups. However, many others watched with alarm and concern, according to Houston attorney Richard O. Faulk, Chair of the Litigation Department at Gardere Wynne Sewell LLP.

"The settlement numbers are extraordinary, to be sure. But the settlement impacts far more than acid rain polluters," says Mr. Faulk, who also heads Gardere’s Climate Change Task Force. "To those in the know, it’s easy to see that the EPA has tipped its hand to show us the model for proceeding against those responsible for global climate change. Now that the Supreme Court has ordered the EPA to consider carbon dioxide as a ‘pollutant’ in its rulemaking process, there is reason to believe that the new, aggressive enforcers will find reason to do so – and that they will then use the AEP model to bring industrial targets to their knees.

"New York Gov. Eliot Spitzer, who as Attorney General, pursued AEP and other power companies simultaneously with EPA enforcement, has already signaled the move toward dealing with carbon and fossil fuels. Current New York AG Andrew Cuomo recently raised the stakes by subpoenaing several companies regarding the adequacy of SEC disclosures regarding greenhouse gas issues. Counsel for environmental groups have extolled the AEP deal as a ‘blueprint’ and ‘roadmap’ for climate change enforcement.

"Perhaps most alarmingly, this deal was cut with an administration known for its relatively conservative approach to enforcement," says Mr. Faulk. "One can only imagine the aggressiveness of an EPA empowered and driven by more liberal policies. Somewhere toward the end of the EPA’s enforcement chain are the shareholders and employees of those industries, as well as consumers, whose jobs, retirement funds, pensions and savings may be impacted by such tactics."

Gardere Wynne Sewell LLP, an AmLaw 200 firm, was founded in 1909 and is one of the Southwest’s largest full-service law firms. With offices in Austin, Dallas, Houston and Mexico City, Gardere provides legal services to private and public companies and individuals in areas of energy, litigation, corporate, tax, environmental, labor and employment, intellectual property and financial services.