Settling Without SEPs: An Environmental Law Institute Member Webinar
On March 12, 2020 the Environment and Natural Resources Division (ENRD) of the Department of Justice (DOJ) issued a memorandum prohibiting the use of supplemental environmental projects (SEPs) in settling civil disputes effective immediately. Historically, companies have leveraged SEPs in settlement negotiations with ENRD by agreeing to undertake a project with environmental or health benefits, often tailored to the specific alleged violation(s), in exchange for reduced financial penalties.
Many view SEPs as streamlining the settlement process. However, DOJ reasons that SEPs are inconsistent with the Miscellaneous Receipts Act by circumventing revenue that otherwise would be deposited to the Department of Treasury. How will ENRD’s prohibition on SEPs affect ongoing settlement negotiations? How might companies adjust their settlement negotiation strategies in light of this change? What are the limitations of this memorandum, and how could such be applied? Environmental Law Institute and expert panelists explored these questions and more by diving into this memorandum and its potential impacts on settlement negotiations.
Corinne Snow moderated a panel discussion titled “Settling Without SEPs” hosted by the Environmental Law Institute on Wednesday, May 27. The panel discussed the memorandum issued by the Environment and Natural Resources Division of the Department of Justice prohibiting the use of supplemental environmental projects (SEPs) and how companies can adjust their settlement negotiation strategies and what the limitations are of this memorandum.
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This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.