Friends of the Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc.

[*173] Justice Ginsburg delivered the opinion of the Court.

This case presents an important question concerning the operation of the citizen-suit provisions of the Clean Water Act. Congress authorized the federal district courts to entertain Clean Water Act suits initiated by “a person or persons having an interest which is or may be adversely affected.” 33 U. S. C. §§ 1365(a), (g). To impel future compliance with the Act, a district court may prescribe injunc-tive relief in such a suit; additionally or alternatively, the court may impose civil penalties payable to the United States Treasury. § 1365(a). In the Clean Water Act citizen suit now before us, the District Court determined that injunctive relief was inappropriate because the defendant, after the institution of the litigation, achieved substantial compliance with the terms of its discharge permit. 956 F. Supp. 588, 611 (SC 1997)* The court did, however, assess a civil penalty of $405,800. Id., at 610. The “total deterrent effect” of the penalty would be adequate to forestall future violations, the court reasoned, taking into account that the defendant “will be required to reimburse plaintiffs for a significant amount of legal fees and has, itself, incurred significant legal expenses.” Id., at 610-611.

The Court of Appeals vacated the District Court’s order. 149 F. 3d 303 (CA4 1998). The case became moot, the appellate court declared, once the defendant folly complied with the terms of its permit and the plaintiff failed to appeal the denial of equitable relief “[C]ivil penalties payable to the government,” the Court of Appeals stated, “would not redress any injury Plaintiffs have suffered.” Id., at 307. Nor were attorneys’ fees in order, the Court of Appeals noted, because absent relief on the merits, plaintiffs could not qualify as prevailing parties. Id., at 307, n. 5.