The state of Michigan has chosen three law firms to sue an industry that has contributed more than $1 billion to parks in all 83 counties since 1976.
In an email, press secretary Danny Wimmer informed Michigan Capitol Confidential that the Department of Attorney General had chosen three outside legal teams to serve as special assistant attorneys general in the lawsuit against the fossil fuel industry. The department claims the industry contributes to climate change.
“The team made up of Sher Edling LLP, DiCello Levitt LLP, and Hausfeld LLP brings an exceptional mix of skilled attorneys who have experience successfully representing public entities in specialized litigation involving environmental issues and industry deception.”
Seventeen attorneys from private law firms signed the contract. None of the attorneys are based in Michigan. Instead, they are from San Francisco, Chicago, and Philadelphia, respectively.
Michigan’s contract with the firms runs from September 26, 2024, to September 30, 2027, and can be extended with 30 days’ notice, according to the 14-page contract obtained through a Freedom of Information Act request.
Outside lawyers will receive 10% of any payout the state receives, up to $150 million, prior to discovery and 16.67% after discovery. According to the contract, they will receive 2.5% of amounts greater than $150 million prior to discovery and 7.5% thereafter.
Every year, Michigan receives millions of dollars in royalties from the sale and lease of state-owned gas and mineral rights. According to the House Fiscal Agency, the figure will exceed $42 million by 2023.
Since the Natural Resource Trust Fund was established in 1976, the Department of Natural Resources has listed over 2,500 projects funded by oil and gas royalties and revenue.
The trust fund makes grants to local governments and the DNR so that they can acquire and develop land. The projects seek to expand recreational opportunities while also protecting land due to its environmental value or scenic beauty.
The Michigan Constitution requires that at least 25% of the fund’s grants be used for acquisition and no more than 25% for development.
Revenues from the oil and gas industry are now deposited into the Michigan State Parks Endowment Fund until the fund balance reaches $800 million, at which point revenues will be credited back to the trust fund. According to the most recent data available, the endowment fund has a balance of $323.5 million.
According to the American Petroleum Institute’s 2023 report, Michigan’s oil and gas industry employs 229,000 people.
According to the US Energy Information Administration, Michigan ranks 18th among states in crude oil production, 19th in natural gas production, and 27th in total energy production.
The Center For Climate Integrity reports that similar lawsuits have been filed by governments in California, Connecticut, Delaware, Hawaii, Illinois, Maryland, Massachusetts, Minnesota, New York, Oregon, Pennsylvania, Rhode Island, South Carolina, Vermont, and Washington, D.C.
