LEED Promotion and Municipal Anti-Trust Liability: It’s Not Monopoly Money Anymore

In this blog series, Colin W. Maguire, JD, SP, recounts his drafting of the legal article The Imposing Specter of Municipal Liability for the Exclusive Promotion of Green Building Certification Systems, 1 University of Baltimore Journal of Land & Development 157 (2012).

When we left off, I was arguing that municipalities open themselves up to liability by exclusively promoting green building certification systems.  We start with the liability problem at the state level.

States routinely immunize themselves from lawsuits. In my article, I used the example of Michigan – perhaps among the most vigorous of self-immunizers. Still, the general rule of self-immunization for tort liability holds true across almost any jurisdiction. A noteworthy exception to lawsuit immunization also holds true across the states – you can sue state governments for improper monopolistic activity. One reason that anti-monopoly or anti-trust laws present a common exception to government liability immunization is that state anti-trust issues are so often associated with federal anti-trust issues. The goal is to protect consumers from the monopolistic intentions of large businesses, but also the unconditional support of those businesses by governments.

Are there proper state monopolies? A state department or a local municipality may actually say “we are going to support X Company and no other.” However, you need a legitimate “government function” directly supported by a state statute. Therefore, it is useful to ask the question “does a state law allow a government or government unit to act this way?”

If you research relevant cases, then you would find that a local government can pick one ambulance company to contract with because a few state statutes empower all Michigan municipalities to provide ambulance service. Similarly, the Department of Corrections has a statutory mandate to manage and control prisons facilities. Therefore, the Department can choose a collect-call service that will service the phones in those facilities. But in Michigan, there is no green building statute.

There is the Stille-Derossett-Hale Single State Construction Code Act. Part of that law is designed to promote the use among municipalities of leading national standards for materials, modern technologies, and energy-efficiency standards. But every single reference in that law is plural. The only state law remotely relevant to promoting optimum construction and energy-efficiency in design (which could sound like green building technology) promotes a plurality of standards. In other words, there is no government function which indicates a municipality can exclusively promote one private green building certification. However, that does not mean that other states have not expressly addressed green building certifications in statutes.

Part 2 of a 6-part blog series to be continued.