‘USGBC v. Energy Efficiency’ Finds Its Way to Litigation
One of USGBC’s more vocal critics claims in a class-action lawsuit that meeting LEED standards doesn’t deliver as promised on energy efficiency, water efficiency, or air quality. The suit highlights important issues, but will it hold up in court?
This is an interesting time for proponents and detractors of the U.S. Green Building Council’s Leadership in Energy & Environmental Design program. As one the most popular green-building certification services in the nation, LEED also is one of the biggest targets of critics who find fault, in various areas, with its rating system.
One common complaint is that energy efficiency isn’t properly weighted in LEED criteria. At a green-building summit co-presented last month by the Oklahoma State Home Builders Association, for example, forensic engineer Joe Lstiburek, a principal at Boston-based Building Science Corporation and a GBA Advisor, took aim at what he said were essentially identical levels of energy efficiency performance among LEED-certified commercial buildings and a national performance survey of buildings that were not certified.
A principal weakness in the current lineup of green-building rating systems for commercial buildings, including the LEED for New Construction and Major Renovation program, Lstiburek said, is that they give too much weight to factors other than energy efficiency, which in his view should account for 80% of the ratings score, with water efficiency covering 10% and materials 10%. He went on to emphasize the importance of taking the time to focus on often-neglected building-science details – floor-to-wall and wall-to-ceiling points of contact in particular – when developing building plans.
Another critic presses his case
Then, last week, simmering concerns about LEED certification came even closer to a boil. A lawyer for Henry Gifford, an occasional GBA contributor and the owner of Gifford Fuel Saving, an energy consultancy based in New York City, filed a class-action lawsuit on Gifford’s behalf on October 8 in U.S. District Court for the Southern District of New York, claiming that LEED doesn’t deliver as it allegedly promises on energy efficiency, water efficiency, or air quality.
The complaint refers to “Defendants’ deceptive marketing claims that LEED-certified properties use 25% less energy and achieve CO2 emissions reductions over non-LEED-certified improved air quality and improved water efficiency, false claims which deceive substantial segments of the market in violation of the Lanham Act…” The Lanham Act is a federal law designed to protect against trademark infringement and false advertising; the suit also alleges fraud under the Sherman Antitrust Act.
The class of plaintiffs includes Gifford, building owners who have paid for LEED certification, tradespeople who have lost business because of USGBC’s allegedly fraudulent climb to market dominance, and taxpayers whose taxes helped pay for LEED certification of publicly commissioned buildings. The complaint demands $100 million in compensation, cessation of alleged deceptive and fraudulent practices, and payment of legal fees.
Interpretations of data
The assertions in the suit hinge in large part on Gifford’s analysis of a 2008 study comparing predicted energy use in certified buildings with actual energy use, and with a national average for existing buildings. The study was conducted by USGBC and the New Buildings Institute, which drew on data from the Department of Energy’s Commercial Buildings Energy Consumption Survey of 2007.
As Environmental Building News noted this week in its report on the lawsuit, NBI concluded from the data that LEED buildings are, on average, 25% to 30% more efficient than the national average – a finding that contrasts starkly with Gifford’s analysis of the information, which concluded that LEED buildings are, on average, 29% less efficient.
USGBC told EBN it would respond after it has reviewed the complaint. Meanwhile, Shari Shapiro, a LEED Accredited Professional who is an attorney with Obermayer Rebmann Maxwell & Hippel, based in Philadelphia, noted in a blog posted on GreenBiz.com that the complaint’s standing as a class action could be shaky given the diversity among the plaintiffs and the disparate harms USGBC’s program allegedly caused them.
Questions of guarantees and intent
“The plaintiffs,” Shapiro writes, “are purporting to file suit on behalf of a whole range of plaintiffs with all different harms – harms to building and design professionals who sought educational certifications, building owners who paid additional money to have their buildings certified and other unspecified ‘consumers,’ and taxpayers.”
Should the class action fail to be certified by the court, Gifford would be the sole plaintiff. The harm done to his business by LEED, he told EBN, stems from USGBC’s allegedly false claims that its product saves energy – claims that allegedly have advanced LEED’s market power unfairly. “Unless you’re a LEED AP,” he said, “you're not going to get work.”
While the suit might further focus attention on an issue that Gifford believes is vital to the building industry, for his legal team to advance and win the case, it not only would have to demonstrate that his interpretation of the NBI study is correct but also prove – through the discovery process, should the case proceed – that USGBC intentionally misled plaintiffs on the issue.
One USGBC co-cofounder who was not named in the lawsuit, Michael Italiano, pointed out, however, that while the LEED for Existing Buildings program (introduced in 2002) provides a system for tracking building performance, LEED projections about energy efficiency for a project are just that – projections. “LEED doesn't guarantee anything,” he told EBN, “and I think LEED gives people the tools to understand that.”
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