Law firms representing radical environmental activist groups like the Sierra Club and Center for Biological Diversity reaped more than $20 million in tax-funded legal fees between 2013 and 2024 through “Sue-and-Settle” schemes with the U.S. Environmental Protection Agency (EPA), according to a non-profit government watchdog.

The Sierra Club led the way, receiving more than $4 million from the EPA to cover the activist group’s legal fees, according to Open the Books (OTB), the Illinois-based nonprofit with the largest public spending database ever created. The OTB database includes virtually all federal and state-level spending, as well as that of the nation’s major municipalities like New York City and Chicago.

The data is obtained using the federal Freedom of Information Act (FOIA) and its state and local equivalents. Since its founding in 2009, OTB has filed more than 50,000 FOIA requests and gone to court multiple times to enforce the law and ensure transparency, with “every dime online in real time.”

“Sue-and-Settle” litigation has been around for decades, but the tactic became a national political issue during President Barack Obama’s Oval Office tenure. The practice was then increasingly employed by the political and career government officials who shared the advocacy positions of the activist groups.

After the suit is filed, agency officials agree to take a certain action in return for the withdrawal of the litigation. The government also agrees to pay the activist group’s legal fees. The action required in the settlement agreement changes official policy by court decree rather than congressional law-making.

Then-EPA Administrator Scott Pruitt issued a 2017 directive banning the practice as a means of “circumventing the regulatory process set forth by Congress.” But Pruitt’s directive was withdrawn by Michael Regan, who was appointed by President Joe Biden as EPA chief in 2022.

Other groups in the top 10 of recipients of “Sue-and-Settle” legal fee reimbursements include the Northwest Environmental Advocates with $1.8 million, the Center for Biological Diversity with nearly $1.5 million, the Environmental Law & Policy Center with almost $1.1 million, and the National Environmental Defense Council, also with nearly $1.1 million.

During the Biden era, Sierra Club, Northwest Environmental Advocates, and Environmental Law & Policy Center were the top three recipients, but the fourth and fifth largest recipients were the State of California and Clean Wisconsin. But the amounts reimbursed during President Donald Trump’s first term, with the Pruitt Directive in force, were substantially smaller. Sierra Club, for example, got more than $1.7 million under Biden, but only $726,987 under Trump.

Walter Olson, a legal scholar with the Cato Institute, told OTB that “Sue-and-Settle” deals can be found under presidential administrations of both major political parties.

“The people who staff regulatory agencies very often come from the same communities that litigate against agencies. In a Republican administration, this might include some regulated businesses or law firms representing regulated businesses. In a Democratic administration, it might mean some of the environmental groups. But these are the people who tend to know all about the ins and outs of the agencies, law, and they are often people who run the agency. Sometimes the person who filed the lawsuit with one of the organizations, by the time they want to settle, is working for the agency.”

Former New York Rep. Lee Zeldin, the current EPA Administrator, has not made any public moves to reinstate the Pruitt Directive. OTB said a Zeldin spokesman claimed the issue is on the agenda.

“Outside activist groups should not dictate EPA’s agenda or federal environmental policy. The Trump Administration is keenly aware of concerns with sue-and-settle practices and commits to not engage in them. The Trump EPA will respect the rule of law and the will of the American people in setting policy based on its statutory mandates and Gold Standard Science, not based on side deals with outside activist groups dead-set on driving up costs to Americans or advancing the interests of our foreign adversaries,” the Zeldin spokesman told OTB.

The “Sue-and-Settle” tactic is also a problem in the retirement security field. During a Tuesday hearing of the House Education and Workforce Committee’s Subcommittee on Health, Employment, Labor, and Pensions, panel members were told by witnesses of multiple abuses.

“In one recent lawsuit, plaintiffs’ counsel sued over a dozen defendants, including a defendant’s infant grandchild. Plaintiffs there went so far as to send a process server to the infant’s home, a wholly unnecessary step that only harassed the other defendants in an effort to increase settlement pressure.”

“In another recent example, plaintiffs’ counsel unnecessarily sued dozens of defendants, who were eventually represented by roughly a half dozen different law firms. This put enormous financial strain on the plan’s sponsor, which was obligated to indemnify most of the defendants for their defense costs and settlement payments, during the multi-year pendency of the meritless lawsuit,” said witness Andrew Salek-Raham, Principal of the Groom Law Group.

House Subcommittee Chairman Rick Allen (R-Ga.) warned that “employer-sponsored health care and other plans provide important benefits to American workers and their families. … These assets represent the savings and contributions of workers and their employers. But make no mistake, such a large pool of assets is attracting predatory lawyers who are targeting employee benefit plans for easy, quick-money, sue-and-settle lawsuits,” he said.