By NICK POPE
Law firms could reap a massive windfall from climate lawsuits that have been filed in numerous Democrat-leaning jurisdictions across the U.S., a Daily Caller News Foundation review of legal contracts found.
Several state and municipal prosecutors across the country have signed agreements with private law firms to help with lawsuits against major energy corporations. These contracts, known as contingency fee agreements, reward law firms with a percentage of the payout if the parties reach a settlement — but do not require substantial up-front payments from local governments. (RELATED: Supreme Court Declines Energy Companies’ Bid To Stop Minnesota Climate Lawsuit From Proceeding In State Court)
These agreements create incentives for activist law firms and often-Democratic prosecutors to collaborate on litigation against American energy companies in pursuit of hefty settlements. Prospective settlements could vary in size, ranging from tens of millions of dollars to billions depending on how the cases play out, according to E&E News. While the specifics of the cases vary, the lawsuits generally argue that major energy companies are liable for misleading the public about environmental damage their products allegedly cause.
For example, Sher Edling’s agreement with Minnesota, led by Democratic Minnesota Attorney General Keith Ellison, stipulates that the firm will make 16.67% of the first $150 million recovered and 7.5% of any additional recovery in the state’s climate lawsuit against energy interests like ExxonMobil and the American Petroleum Institute. Notably, Sher Edling employees have given tens of thousands of dollars to Democratic candidates dating back to 2016, according to Federal Election Commission data.
Sher Edling and Ellison did not respond to the DCNF’s request for comment.
Sher Edling, along with another law firm by the name of Tycko and Zavareei, also contracted to assist a climate lawsuit in Washington, D.C. That particular agreement caps the firms’ payouts in the event of a settlement at a cumulative $70 million.
Tycko and Zavareei did not respond to the DCNF’s request for comment.
Critics say these lawsuits are based on questionable legal theories and are an attempt by special interests to enact anti-fossil fuel policies via the legal system. None of the lawsuits so far have been successful.
“Radical climate activists are bankrolling law firms like Sher Edling to try and bankrupt America’s energy producers and engage in shadow policymaking to ban fossil fuels,” a spokesperson for Republican Texas Sen. Cruz and the Senate Commerce Committee told the DCNF. “Obviously, these law firms do not take any financial risk in bringing these ludicrous lawsuits.”
