A class action lawsuit against the USGBC has just been filed in Federal Court for the Southern District of New York (Gifford v. U.S. Green Building Council, docket number 10 CIV 7747). Stephen Del Percio who does a great job publishing the Green Real Estate Law Journal and Green Buildings NYC broke this story (at least to me), and it’s going to have reverberations throughout the sustainable development community.
The complaint is brought on behalf of Henry Gifford, Gifford Fuel Saving, Inc., and others similarly situated. In a nutshell, the plaintiffs allege the USGBC has engaged in deceptive trade practices, false advertising and anti-trust (among other things) by promoting the LEED system. Plaintiffs further allege that because the LEED system does not live up to predicted and advertised energy savings, the USGBC defrauded municipalities and private entities.
The basis for the class action has been mentioned more than a few times in this blog and many others (including Mr. Del Percio’s). Essentially, many green buildings are not performing as touted. In some situations they are performing WORSE than buildings built to code. The plaintiffs allege that because of these performance shortcomings, the USGBC commits anti-trust violations when it convinces municipalities to align their building codes to the USGBC’s LEED system.
While some LEED buildings are underperforming, the lawsuit is no slam-dunk for the Plaintiffs. From a personal perspective, I find plaintiff’s complaint is a bit overly dramatic. An effective complaint acknowledges and then refutes the defense’s potential arguments. Here the plaintiffs’ complaint seems almost melodramatic in its representation of big bad USGBC. In my opinion they lose some credibility there.
One of the biggest issues plaintiff will face is that occupants are often the primary reason green buildings underperform. Many occupants don’t understand the new technology used in green buildings. However, occupant “sabotage” is not the exclusive reason green buildings underperform. Often it is also because the technology itself doesn’t work. The USGBC is working on this issue, and Post-Occupancy Performance is a cornerstone of LEED 3.0.
No doubt there is a valid lawsuit here, and I anticipate this lawsuit will grow if more members of plaintiffs’ class sign on. We’ll keep you updated as the lawsuit progresses.
Click here for a copy of the complaint.
Steve Sacks
