In a scathing article, James Brasuell uses a confidential settlement agreement between a developer and a local homeowners' group in Los Angeles to demonstrate "a practice sometimes called 'greenmail,' in which businesses and homeowners groups use the threat of CEQA-based lawsuits to generate cash from developers for things that have nothing to do with the environment."
The settlement, which was leaked to Brasuell by an anonymous source in City Hall, discloses how the La Mirada Avenue Neighborhood Association was able to wrestle $90,000 for "La Mirada's costs, and attorney's fees and costs" and "a monitoring payment" of $250,000 "to be used as La Mirada sees fit," from an unnamed developer in exchange for promises not to oppose a project.
"The document provides hard evidence for this common practice," says Brasuell. "'We absolutely don't know what happens with the money. Typically in a settlement, there is no limit on how much money or what the money can be used for,' says Jennifer Hernandez, partner at the firm Holland & Knight....Hernandez describes the lawyers who seek financial sums unrelated to the laws that they are suing under as 'bounty hunters.'"
"The greenmail problem, Hernandez notes, is unique to California's backwards use of a statute like CEQA: 'In other states and under NEPA [a federal law similar to CEQA], if your interests are primarily economic, you cannot sue under an environmental statute ... California has gone in a remarkably different direction."'