SLAPP lawsuits may backfire on a company’s reputation

GallonLetter and GallonDaily have written before about SLAPP suits. A Strategic Lawsuit Against Public Participation is a suit that is intended to censor, intimidate, and silence critics by burdening them with the cost of a legal defence until they abandon their criticism or opposition. But SLAPP suits do not always work as Shell found out this week. Shell may well be in a worse public opinion situation now than it would have been had it not initiated a suit against Natural Resources Defense Council and a number of other environmental groups.

In brief, Shell asked the court to pre-emptively validate the federal Bureau of Environmental Safety and Enforcement’s approval of the company’s Alaskan Arctic oil spill plans against any future legal challenge by the environmental groups. This was widely interpreted as an initiative intended to quash dissent against Shell’s plans for Arctic drilling.

The court found this to be a “novel litigation strategy, whereby the beneficiary of agency action seeks to confirm its lawfulness by suing those who it believes are likely to challenge it” and dismissed the case as unconstitutional. Now the environmental groups are trumpeting the court decision as a victory against Shell’s Alaskan Arctic drilling program and are having a field day at Shell’s expense in the US media.

SLAPP suits rarely succeed in the courts, particularly in US courts, and the consequences of a loss can be significant, even though Shell’s lawyer is reported to have said that the Company was prepared for any outcome of the suit. Shell had originally hoped to start drilling in the Arctic in the Summer of 2012, following approval of its plans by the US Department of the Interior. Now it may well be spending more time in court fighting legal challenges brought be the same groups against which it launched its SLAPP suit. In addition, it has almost certainly suffered a blow to its reputation, at least amongst those members of the public who agree with the environmental groups that Shell’s Arctic drilling plans are risky.

NRDC’s account of the court’s decision, with more details included. can be found at http://www.nrdc.org/media/2014/141112b.asp

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