A Potentially Huge Supreme Court Case Has a Hidden Conservative Backer
The Supreme Court is set to hear arguments on Wednesday that, on paper, are about a group of commercial fishermen who oppose a government fee that they consider unreasonable. But the lawyers who have helped to propel their case to the nation’s highest court have a far more powerful backer: the petrochemicals billionaire Charles Koch.
The case is one of the most consequential to come before the justices in years. A victory for the fishermen would do far more than push aside the monitoring fee, part of a system meant to prevent overfishing, that they objected to. It would very likely sharply limit the power of many federal agencies to regulate not only fisheries and the environment, but also health care, finance, telecommunications and other activities, legal experts say.
“It might all sound very innocuous,” said Jody Freeman, founder and director of the Harvard Law School Environmental and Energy Law Program and a former Obama White House official. “But it’s connected to a much larger agenda, which is essentially to disable and dismantle federal regulation.”
The lawyers who represent the New Jersey-based fishermen, are working pro bono and belong to a public-interest law firm, Cause of Action, that discloses no donors and reports having no employees. However, court records show that the lawyers work for Americans for Prosperity, a group funded by Mr. Koch, the chairman of Koch Industries and a champion of anti-regulatory causes.
The law firm’s board of directors includes a top lawyer at the firm that has represented Koch Industries in a range of cases, like the company’s past defense against lawsuits linked to its handling of petroleum coke, a byproduct of oil refining, and in its opposition to stronger regulations on the substance.
The lawyer also represents Koch Industries in an ongoing lawsuit filed by the Minnesota attorney general that accuses the company of deceptive practices related to climate change.
Other members of the board include executives at groups predominantly funded by Mr. Koch or by Koch Industries, America’s second-largest privately held company, after Cargill.
Ryan Mulvey, counsel for Cause of Action and one of the lawyers litigating the case before the Supreme Court, said the focus “should be on the fishermen and what they are fighting.”
“This case is about the livelihoods of hard-working, family-run fishing companies that are under threat because of unconstitutional overreach by the government,” Mr. Mulvey said.
A spokeswoman at Cause of Action said the group was within its constitutional rights to not disclose its donors. The spokeswoman, who declined to be identified, said that Cause of Action and Americans for Prosperity were separate organizations. Neither Mr. Koch nor Koch Industries were involved in the case, she said. Koch Industries did not respond to requests for comment.
Rolling back the power of the state to regulate business has been a longstanding goal of conservative legal activists and their funders, who have been engaged in a yearslong effort to use the judicial system to rewrite environmental law. In 2022, they scored a victory with a Supreme Court decision that could sharply limit the federal government’s authority to reduce carbon dioxide from power plants. Emissions from the burning of fossil fuels are a primary cause of climate change.
The legal doctrine being challenged in the fishing case, Loper Bright Enterprises v. Raimondo, No. 22-452, has wider implications. The doctrine, known as the Chevron deference, after a 1984 Supreme Court ruling involving the oil and gas giant, empowers federal agencies to interpret ambiguities in laws passed by Congress.
Congress is not equipped to manage the day-to-day administration of the legislation it passes, the reasoning goes, so it should rely on federal agencies to carry out laws and policies. Weakening or eliminating the Chevron deference could limit the power of federal agencies to interpret the laws they administer.
The Biden administration has defended the rule, arguing that executive agencies, unlike courts, are politically accountable.
Supporters of the rule say the case is a vehicle for other interests beyond the fishermen’s complaint.
“These fisheries workers are providing cover for what is ultimately a Koch campaign,” said Lisa Graves, executive director of the progressive watchdog group True North Research and a former senior Justice Department official.
With the Supreme Court’s shift to the right in recent years, free-market proponents appear to see an opportunity to clip the wings of federal power, in part by bringing carefully selected cases before sympathetic judges.
That shift has been aided by groups, including those linked to Mr. Koch, that worked to support the nomination and confirmation of the five most recent Republican appointees on the bench.
At a forum hosted in November by the Federalist Society, a conservative legal group, a lawyer laid out the strategy.
“To successfully wage such a campaign, you need three things,” Damien M. Schiff, a senior attorney at the Pacific Legal Foundation, said at the forum. “Money, legal personnel and a judiciary that’s receptive to strategically selected and timed legal arguments.”
Conservative groups and their backers now have all of those things, Mr. Schiff said, according to a video. In particular, “money’s never going to be a problem,” he said. “One can easily litigate to the Supreme Court on the cheap.”
“Congratulations,” responded David Doniger, a lawyer in attendance at the event who, 40 years ago, argued the original Chevron case on behalf of the Natural Resources Defense Council. “But to me, this is clothing nakedly private interests in highfalutin’ constitutional arguments.”
In an interview, Mr. Schiff said that cases like these were fast becoming the preferred way for groups to fight federal regulations. “When you compare how much impact that one can have on society through litigating, and especially winning in the Supreme Court, to lobbying with administrative agencies or through political campaigns,” he said, “it’s much more efficient.”
His group, Pacific Legal Foundation, is part of a network of conservative research organizations that has received funding from Mr. Koch and other donors.
The Loper Bright case, now consolidated with a similar case involving fishermen from Rhode Island, has in many ways offered litigators a compelling story line of small businesses fighting for survival. The fishermen feature prominently on a page offering information on the case, promoted via Google ads.
“Nobody in a family business wants to be the last one to do it, everyone wants to pass it along, and my fear is I might not be able to,” Stefan Axelsson, introduced as a third-generation commercial fisherman, says in one featured video, titled “Fishermen fight back against unlawful, job-killing government mandate.” Mr. Axelsson couldn’t be reached for comment.
The page doesn't mention the Koch affiliations, though a contact form generates an email to Cause of Action, as well as to Stand Together, a nonprofit group founded by Mr. Koch, who remains one of its donors.
The Cause of Action Institute has disclosed little of its funding: A year before it was created, the Supreme Court’s Citizens United ruling had enabled billions of dollars in spending by groups that don’t disclose their donors.
Cause of Action’s founder, Daniel Z. Epstein, had previously been an associate at the Charles G. Koch Foundation. The group’s first known address was the same as that for Americans for Prosperity.
In an interview, Mr. Epstein, who later served as counsel to Donald J. Trump’s first presidential campaign and transition team and is now an associate professor at St. Thomas University, said Cause of Action’s work with fishermen hadn’t been born of a motivation to overturn the Chevron doctrine. “It had everything to do with an observer program that spies on the fishermen,” he said.
He declined to discuss funding.
Cause of Action has had two cash infusions, both from Mr. Koch’s Stand Together, according to tax filings from Stand Together, including more than $4 million in 2019, and $1.1 million in 2020. In its most recent tax filing, covering the time when the fishermen’s case was being worked on, the group reported having no employees. The case is being litigated by lawyers who work for Americans for Prosperity, including Mr. Mulvey.
The board that directs Cause of Action includes William Burck, who is managing partner at the law firm Quinn Emanuel, which has represented Koch Industries in litigation against environmental regulations. Mr. Burck is the lead lawyer in Koch Industries’ defense in a separate case before the Supreme Court, the lawsuit filed by Minnesota accusing Koch and other oil and gas companies of undermining the public’s understanding of the dangers of burning fossil fuels.
Other board members include Emily Seidel, the chief executive of Americans for Prosperity, formerly director of special projects for Koch Companies Public Sector, Koch Industries’ lobbying arm; and Kurt Level, the current deputy general counsel at Koch Companies Public Sector.
