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Two Dudes Talking About A Lawsuit: The gbNYC Exclusive Meta-Interview On Henry Gifford’s Antitrust Suit Against The USGBC

Henry Gifford’s semi-blockbuster class action lawsuit against the USGBC and more or less everyone who ever had anything to do with LEED has been a big deal from essentially the moment that Stephen broke the news over at the Green Real Estate Law Journal, but — in the way that multi-part legal pleadings can be difficult to those of us who are really just bluffing sportswriters outside the legal profession — the whole thing has remained opaque even as its potential import became clearer and clearer. Luckily, I have the email address of a prominent green building expert, and he had the time to deal with me asking him some questions over IM. And so the gbNYC world exclusive (must credit gbNYC!) interview with a guy I went to kindergarten with, and who also knows a lot about stuff like this — gbNYC founder and capo-in-chief Stephen DP.

David: So. Henry Gifford is not happy with LEED and suing everyone he can. But Henry Gifford not liking LEED or the USGBC is not necessarily news. So what can you tell me about this?

Because I sense it’s more “news” than “something that’s going to result in a verdict,” given how ambitious and wide-ranging the suit seems to be.

Stephen: I think you’re right, Dave. My gut feeling (not as an attorney) is that the suit is as much about grabbing folks’ attention as it is about getting a class certified and recovering $100 million in damages from USGBC. But Gifford has been talking about the NBI study and its shortcomings for close to two years.

David: So catch everyone up. By which I mean catch me up — why this suit, why now, and what’s the big deal. Also, as an attorney: how do you decide on $100 million? Just pick a big number and then add a few zeroes and out it goes?

Stephen: As engineer Larry Spielvogel (one of ASHRAE’s distinguished lecturers) has noted over at Green Real Estate Law Journal, the fact that neither USGBC nor anyone else has come forward with any data to rebut Gifford’s claims that LEED buildings aren’t performing as intended is something worth noting.

David: And that probably had a lot to do with the suit, right — that’s kind of Gifford’s mission. Beyond broader gadflying, the guy’s about calling LEED on the carpet for not delivering where it doesn’t deliver.

Stephen: As to why this suit, now? I know through the grapevine that it has been a work in progress for some time, but I don’t think there’s anything special or significant about it being filed in early October. The big deal is that it has the potential to become a huge black eye for USGBC if it survives an initial motion to dismiss from USGBC’s attorneys, which I think will be filed before the end of the year.

Stephen: If the case moves forward, the District Court could order discovery to allow Gifford’s lawyer to try and certify a class of plaintiffs. In that case, certain documents, including emails, etc., could come to light that might cast the organization in a, let’s say, not very favorable light.

David: And who would be in this class of plaintiffs. This is what I don’t get. Everyone in a LEED-certified building whose electric bills aren’t as low as they’d thought they would be?

Stephen: Possibly. It’s up to Gifford’s lawyer from the Attorneys Augusta GA to argue who should constitute the class in her motion to certify the class. Then it would be up to the judge to certify it.

David: The purpose, I suppose, is for those documents to see the light of day, right?

Stephen: Right. That could be the end game for Gifford, to show that USGBC knew the 2008 NBI study wasn’t good for it, but massaged the results into an executive summary that was more palatable for it and its constituents. (I should add here that this is all speculation, isn’t legal advice, and is purely my opinion based on reading the complaint and following these issues for the past two years).

David: Sure. That’s assumed. This is going on gbNYC, no one takes this as gospel. Most of my posts are just 900-word tone poems about insulation. But let’s talk about that NBI study and Gifford’s suspicions about LEED.

Stephen: Sure.

David: It’s kind of his mission to show that they’re… not quite covering-up, but that they’re not being totally forthright about the limitations of what LEED has delivered. How damaging do you think more attention on that charge would be to LEED? And where could that, um, lead? Again: speculation, not legal advice, two dudes BSing on IM — all caveats announced.

Stephen: For me? It doesn’t change that much. I think most people in the industry, at this point, understand that a LEED rating and a building’s overall energy performance are two very different things. The problem is with policymakers, politicians, and legislators who are using the 2008 NBI study and its promises of “25 percent more energy efficient!” LEED buildings to promote LEED-driven green building policies.

David: Right. Well LEED isn’t perfect, obviously, we both know that. But what I resent about it — to the extent that it bugs me that much at all — is that it’s essentially without competition and therefore kind of unaccountable in a sense. I just don’t know that a lawsuit does anything to change that — it seems the equivalent of a negative campaign ad.

Stephen: Right, and I think that’s a huge part of what compelled Gifford to file the complaint. He, like many other designers, has pursued efficiency in buildings for decades. And now, many designers with years of experience are being told that if they don’t have a LEED-AP designation or the capability to navigate the notorious LEED bureaucracy, they shouldn’t bother responding to requests for proposals, etc.

David: And that’s the issue I have with LEED, basically. The effective monopoly thing. It’s not a crime to have a good brand, but it’s not helpful when what you described above is the case.

Stephen: I think that’s a tough argument.

David: Well, I mean “effective monopoly” as an idiot-blogger, not as a lawyer.

Stephen: Fair enough, but there is an important distinction.

David: Between bloggers and lawyers, yes.

Stephen: I mean, is LEED a “product?” So, if LEED is a “product,” is USGBC unfairly monopolizing the market for private, third-party green building certification systems? There is some case law out there which I have written about previously; I’ll spare you the citations, but the essence is that I’ve not been able to find anything directly on-point where an organization like USGBC was found liable for an antitrust violation in a similar context.

David: So that’s the antitrust portion of Gifford’s suit, but there are like eight different counts, right? From what I read about it, I sense there’s a see-what-sticks thing going on.

Stephen: Well, that’s much of what pleading involves. But, yes, he is making those allegations and, who knows, perhaps this will turn into a case of first impression that is extensively litigated. Even if that happens, though, it will be years before a court gets to the substantive merits of the claims and, I think, the more likely outcome is some sort of settlement. But that is wildly speculative at this point.

David: And I don’t sense he’s in it for a settlement, money-wise.

Stephen: Me neither. But his lawyer, and any other plaintiffs that join the class, might be.

David: I just also don’t know how or where this suit compels change on the part of USGBC. How, by the way, is this different from the false advertising suit filed against The Riverhouse? They seem like similar complaints.

Stephen: Well, much of the reaction to the suit has focused on the things that USGBC HAS changed since 2008, requiring ongoing reporting of building performance data, automatically enrolling all LEED-NC buildings in LEED-EB. Which is great, obviously, and a step in the right direction, but more or less irrelevant to Gifford’s claims.

David: Spin, sort of.

Stephen: Not spin, it’s real positive change, but also perhaps too late to undo the perception that a LEED rating automatically translates into increased energy savings and a dramatically more efficient building with happier and more productive occupants

David: Do you sense that USGBC wants to undo that perception? Gifford clearly does. And if the USGBC has been forthright about the changes they’re making — and they more or less have — and why they’re making them, then is lazy thinking at fault? On the part of the people in government and elsewhere who just see LEED and think “more efficient,” and in the people who then write shocked, shocked articles about how that isn’t always so?

Stephen: Personally, I think USGBC and LEED have been a positive thing for the built environment. We’re not having this conversation were it not for each. However, there are many engineers and architects who feel differently. And I don’t necessarily disagree with them.

David: So we’re both sort of in the same place, then — inclined to embrace what we’ve got, but wishing it were better. And frustrated by a general inability to drive the change we want to see. Now you know what it feels like to be a Mets fan.

Stephen: Don’t forget I rooted for the Nets in the ’80s and ’90s too, Dave.

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2 Responses to Two Dudes Talking About A Lawsuit: The gbNYC Exclusive Meta-Interview On Henry Gifford’s Antitrust Suit Against The USGBC

  1. Judith Webb November 7, 2010 at 4:26 pm #

    Just a small clarification: LEED is a voluntary standard so we don’t automatically enroll projects in the system. We do, however, encourage LEED certified new construction projects to pursue certification of their ongoing operations and maintenance by waiving their LEED EBOM registration fees.

  2. Anne Whitacre November 10, 2010 at 11:25 pm #

    And that comment above (regarding LEED as “voluntary” is the most delusional of all. Certainly, LEED is voluntary — unless you want to build a building for the GSA; you want to build a publicly financed building in many states and cities in the US; you want the zoning advantages that come in many large cities in the US; you want to design and build a building on many college campuses across the country. In this economic climate, most construction is being funded by institutions, and many of them require LEED. Most of them are not capable of interpreting LEED and none of them are capable of enforcing it, changing the standards for compliance, or changing the interpretations. When LEED is required by a building code, it is no longer “voluntary”.

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