resources for a couple of years, also limit the big private law firm. That firm would be delighted to take on cases that a couple of men could handle over the course of a year or two and integrate into their paying work. But when you are talking about the big case, it means charting out two, three, or more people who will work on that case and basically no other case for a year or year and a half. I think that even here, if there were a floor, and certainly not the $30 an hour floor that Mr. Kline indicated public interest lawyers are unable to live off either, if there were a reasonable floor that the law firm could be sure would be coming back, I think you would find law firms willing to make up part of this difference as a public contribution. Senator TUNNEY. On page 7 of your testimony you expressed regrets that public interest lawyer needs to wait all through the appellate process before he or she can get his attorney fee. What would happen if he got his fee at the district court level and on appeal there was a reversal. Would he or she have to give his fee back?

Mr. FLANNERY. I guess the case that comes to mind is that Howard Hughes case, a big victory, not a public interest case, a big victory in the district court, for, I think, over a million dollars award of fees. The Supreme Court did reverse it. I don't know what happened to the affected lawyers, but I think that they did have some problems. There is a point in my statement, that I would like to reiterate here. I don't think the standard should be win or lose. In other words, if you win the case somehow you get fees, but if you litigate a case and after 3 years you lose, you get no fees. It is just much more complex than that. In most environmental cases with which I am familiar, where the environmentalists have ultimately lost they have nonetheless made a substantial contribution. Again let's put the Alaska pipeline case aside, I don't want to focus on that, but take the Storm King case in New York, that big FPC project that was probably the biggest environmental case before the Alaska pipeline, to be litigated. Or take the recent Texas case, Sierra Club v. Lynn, 5, ERC 1745 (W.D. Tex, 1973), that Mr. Kline referred to, and several others where the ultimate result has been that the project has ultimately gone forward, yet the filing of the suit, the conduct of the litigation, the light that was brought on the project by the litigation, in the end, very clearly served a public interest and made the project a safer project, a better project. Perhaps the environmentalists who brought the suit still may feel that the project should not go forward. Nonetheless, when the project goes ahead it is a better project for having gone through the lawsuit. So I don't think that the goal should be that public interest lawyers or law firms or whatever who litigate environmental or other public interest suits will get fees if they win and if they lose they won't, and I think it is much more complex than that.

Senator TUNNEY. You have suggested that the corporations in these environmental cases in which the corporation is a defendant, are able to write off their litigation expenses against their taxes, in other words, the taxpayers of the country are indirectly subsidizing the corporate interest. What about the possibility that a person, pre

pared to make a contribution to a defense fund in which the environmental action was brought, could write that contribution off against his taxes rather than getting direct Federal funding?

Mr. FLANNERY. Certainly that is something to think about and to explore and I think it is a possibility. I think the other side of the coin is, again, that when you have economic interests at stake, in other words, for example, if the question was a dispute in which either corporate stockholders or other individuals stood to lose their investment or $3,000 if it went the wrong way, it might be relatively easy to get from a whole group of individuals facing that sort of risk a contribution of $100 to protect their $3,000. When you are talking about noneconomic interests, when you are talking about environmental interests or other interests that cannot be quantified, even though people are very concerned and may be interested in it, I think it more difficult to convince them to fork over $100. This is like public broadcasting or other areas where similar fund raising problems have been experienced. I don't think it is being elitist to say in some of these cases the public at large is not really aware of what the problem is until it reaches absolute crisis proportions. And so you have, in some of these cases, people who are going beyond what the public at large is prepared to accept and yet in a very real sense, I think, the public at large is being served even though if you had a plebiscite or vote, perhaps the vote would go the other way. Senator TUNNEY. Well, Mr. Flannery, you present an extremely interesting and very subtle complex problem to the Subcommittee and I wish that it were possible to say that there was an easy solution to it, through legislative means. I think the very fact that you have not recommended a legislative proposal after all of the many hours that you spent thinking about the problem is indicative of how very complex the problem is.

I for one have always felt, since I have been in public service, a natural inclination to be supportive of the environmental position. When you have on the one hand the interests of preserving the environment in this country contrasted against an unplanned or perhaps poorly planned development of the natural resources, on the other hand, I find it difficult to work out a formula myself which would make it possible to use the Federal taxpayers dollars to sustain an environmental lawsuit. There are, of course, such obvious mechanisms as allowing foundations to exist and use their money for the purposes of supporting these suits or perhaps in some instances providing salaries to the attorneys who are going to bring the lawsuits, as in the case of legal services for the poor. There are instances where those legal service lawyers will bring environmental suits to protect the interests of the poor. But when you step away from those obvious instances, where it is relatively easy to formulate a mechanism to allow Federal tax dollars to support these environmental lawsuits, it becomes much more difficult. I think this has been a most articulate presentation. The problems of having enough money to be able to pay expert lawyers and being able to really have an adversary proceeding rather than a Goliath against David with the Goliath having the slingshot, are evident from your testimony. I just don't know how we are going to be able to formulate a legislative recommendation

that does not in some way rely on incentives to private individuals to make contributions for the purposes of sustaining that lawsuit. I think it would be very difficult to pass a law which says that in an environmental lawsuit X numbers of thousands of dollars will be paid to plaintiffs' lawyers for the purposes of discovery, and for the purpose of paying expert witnesses and attorney fees.

Mr. FLANNERY. The problems are obviously real ones. You are taking as pragmatic a view of possible solutions as I have attempted to take in articulating what the problem itself is. I think that if the goals are kept in mind, the goals of making the adversary system a real system and not simply a paper system and the very real need for having experienced people litigating cases that require experienced people to litigate them, I think that once those issues are aired and are under the consideration of the Subcommittee with the thought that you and your excellent staff will obviously be giving them a mechanism will be found that might satisfy most if not all of the conflicting interests on this matter.

Senator TUNNEY. Well, I hope that you are right. I certainly don't want to sound totally pessimistic but I have had 9 years of experience in Congress and I think that at best it is going to be very difficult to achieve such a legislative formulation.

Mr. FLANNERY. I agree, but I think great efforts begin at the beginning and this is the beginning of a great effort. I am delighted that you are taking such a personal role in it and I have an optimism that the end result will be satisfactory.

Senator TUNNEY. Thank you very much, Mr. Flannery, we appreciate not only your testimony but the opportunity that my staff had to speak to you and flush out some of the points that you have made here today. I think it is something that we really have to address ourselves to.

Mr. FLANNERY. Thank you.

Senator TUNNEY. Thank you.

[The testimony resumes at page 843. The prepared statement of Mr. Flannery follows:]

PREPARED STATEMENT OF DENNIS M. FLANNERY, ATTORNEY AT LAW,

WASHINGTON, D.C.

Mr. Chairman, I appreciate your invitation to appear here today. The questions that the Subcommittee is addressing are, in my judgment, basic to the effective functioning of the decision-making processes of our Government. For those processes cannot serve the public interest if they are exposed to only one side of controversial public issues. I am, therefore, honored at being given this opportunity to participate even in this small way in the Subcommittee's deliberations.

At the outset, I want to make clear that: (1) I am speaking only for myself and not on behalf of any other individual or group. (2) I am counsel of record in two environmental cases in which requests for attorneys' fees are now under advisement. None of the comments I will be making here today are addressed, nor should they be construed to be addressed, to the question whether attorneys' fees should be awarded in either of those cases. The thrust of my comments is, in short, entirely prospective.

In his environmental message to Congress in August 1971, President Nixon stated:

1 Wilderness Society v. Morton, Nos. 72-1796-1798 (D.C. Cir.) (Alaska Pipeline case), Sierra Club v. Fri, C.A. No. 1031-72 (D.D.C.).

"In the final analysis, the foundation on which environmental progress rests in our society is a responsible and informed citizenry. My confidence that our Nation will meet its environmental problems in the years ahead is based in large measure on my faith in the continued vigilance of American public opinion and in the continued vitality of citizen efforts to protect and improve the environment."

But, these citizen efforts cannot serve their legitimate and admittedly desirable purpose, if resources are not available for their effective prosecution. This is particularly true when issues of public importance are being litigated in the judicial forum, whose very structure rests on the presentation by adver saries of opposing positions. Obviously, a just and correct result-which is precisely what the adversary system is designed to produce is least likely when there is a marked difference in the quality of legal representation available to the respective adversaries or in the financial resources that the respective adversaries can devote to the presentation of their side of the case.

For the last two years I was a public interest lawyer, representing the environmental organizations in the massive Alaska Pipeline litigation. Before that I was in private practice for several years, and I am back in private praetice now. I approach the question of citizen interest representation, therefore, from the perspective of one who has had the opportunity to litigate big, factually complex cases both as a private practitioner and as a public interest lawyer. And, I must say that the difference is a striking one.

Having represented both corporations and public interest groups, I believe it is fair to conclude that as things now stand, the more complex the public issue, the more likely it is that the decision-maker-be it an administrative agency or a court--will be presented with an increasingly one-sided approach to the problem. Nowhere is this danger more acute than in the area of environmental law, when environmental interests conflict with large economic stakes. It is difficult to describe, to anyone who has not himself been involved in the process, the extraordinary demands of big case litigation. Months must be spent by the lawyers involved familiarizing themselves with the technical and scientific data germane to the case; in collecting, analyzing, and digesting thousands upon thousands of relevant or potentially relevant documents; in locating and preparing expert and other witnesses; and in participating in the full range of pre-trial discovery and other tactical devices. The culmination of this preparation is, of course, the court hearing, which can last for days or weeks and for which extensive briefs must be written, witnesses prepared, and arguments honed. Finally, win or lose, the likely result of the initial court hearing is the filing of appeal briefs and the presentation of appellate arguments. In short, we are talking about thousands and tens of thousands of manhours of legal work.

When a proposed commercial project pits environmental concerns against the strong economic interests of corporations (or entire industries), the battle is one between David and Goliath. In this battle, however, Goliath holds the slingshot as well as the weight advantage. The concerned corporation will retain and pay full value for the services of one or more of our country's numerous prestigious law firms. Teams of skilled and experienced lawyers, together with competent and well-paid expert witnesses, researchers, and clerical help will be assigned the task of presenting the corporation's case in the best possible light. (Indeed, in most cases it can be expected that this array of legal and supporting talent will have been brought together at the earliest planning stages, before the corporation has even approached the administrative agency with responsibility in the area.)

It is important, I believe, to emphasize here, that neither corporations nor the law firms that represent their interests need be the least bit defensive about leaving no stone unturned in putting forward their best possible case. Indeed, the adversary system, not to mention the canons of legal ethics, demands no less. The problem is that under present circumstances the corporation's citizen interest adversaries cannot devote anything approaching a comparable expenditure of resources to the development of their side of the case.

Concerned citizen interest groups will ordinarily be unable to raise even a small portion of the anticipated legal costs and fees for a major litigating effort. As a result, they are foreclosed at the threshold from retaining the type of legal representation that might best assure the effective presentation of

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their case within the adversary system-i.e., an established law firm with skill and experience comparable to that of the firm representing their corporate opponent.❜

The only realistic source of legal representation for citizen groups contemplating major litigation is the foundation-funded public interest law firm.' The most obvious problems with this state of affairs are (1) there are not enough such organizations to go around, so that numerous meritorious cases may go wanting simply because there is no one to bring them; and (2) we cannot depend upon foundations to support these public interest law firms indefinitely.

But the problems really go much deeper. In their present state of development and with the funds currently available to them, the public interest law firms often do not have on their staffs senior lawyers with the experience necessary for effective big case litigation. The result is that foundationfunded public interest law firms may also shy away from the big case, choosing instead to concentrate their efforts on smaller, more manageable endeavors.

To the extent a foundation-funded public interest firm takes on the big case and regardless of whether the lawyer involved is an experience or neophyte litigator-it will find itself constrained by practical, every day limitations that substantially tilt the balance against it, regardless of the objective merits of the case. To cite but a few examples, resources will be lacking to locate, retain, and prepare expert witnesses; to undertake necessary legal and technical research; and generally to keep pace with the full range of issues that will be explored and developed by the other side. The prospect of court awarded fees and costs at the conclusion of the litigation, if successful, does not ameliorate these problems. There is a cash requirement for funds at the outset to pay these necessary expenses.

I believe. therefore, that one of the most significant contributions that this Subcommittee couid make would be the consideration and development of innovative legislation that would make available-from public sources, private sources, or a combination of both-funds to pay reasonable attorney and expert witness fees, and other court-related costs, of meritorious citizen interest litigation. To serve their purpose, these funds cannot be withheld until the conclusion of the litigation (as, for example, the Clean Air Act now provides, 42 U.S.C. § 1857h-2(d)). Nor should such funds be limited necessarily to those groups whose court litigation results in a formal "victory." Numerous courts have recognized that citizen litigation frequently contributes to safer and more carefully thought-out projects, even though the suit does not succeed in stopping the project entirely. See e.g., Sierra Club v. Lynn, Civ. Act. No. SA 72 CA 77, W.D. Tex. (Spears, J.), June 28, 1973.

While I am not now making any specific proposals, one possible approach that the Subcommittee might explore is to make available interest free "loans," or to guarantee interest free loans from private sources such as foundations, for reasonable legal fees, witness fees, and other litigation-related costs of citizen interest litigation. In its broadest contours such a plan might involve the following. Screening criteria might determine initial and continuing eligibility for such funds in light of the public importance of the matter to be litigated, the disparity between the resources available to the protagonists, and the particular requirements for funds. The funds themselves would be available on a periodic basis (i.e.. quarterly) during the life of the litigation. At the conclusion of the litigation, the courts could determine-much as they do now--whether the case is an appropriate one for taxing the fees and other costs to any of the other parties. To the extent such costs are taxed, the moneys previously advanced could be returned to the loan fund or to the private lender.

Such legislation, or other legislation serving a similar purpose, would in my judgment close, at least to some extent, the unacceptable gap that now exists between available legal representation for private and public interests.

2 Whatever their philosophy toward citizen interest litigation, such private law firms can rarely be expected to volunteer the major, non-compensated effort that such representation would entail.

The admirable public interest lawyers-such as the law firm of Berlin, Roisman & Kessler and the sole practitioner Bruce J. Terris here in Washington-, who are attempting to develop public interest practices independent of foundation funding, can afford even less than the established private law firms to devote a major portion of their time to non-remunerative enterprises. If they are to survive, they must concentrate their efforts on fee-generating public interest cases.