SC Supreme Court Ruling Favoring Appellants
SC Supreme Court Ruling Favoring Appellants
SC Supreme Court Ruling Favoring Appellants
v.
In 2002, the State brokered an agreement with the DOE concerning the storage
of weapons-grade plutonium at the Savannah River Site in Aiken, South Carolina.
See 50 U.S.C. § 2566. The agreement required the DOE to achieve a certain mixed-
oxide fuel production objective by January 1, 2016. § 2566(d)(1). When the DOE
failed to meet this objective, Wilson retained the Law Firms to pursue recovery of
statutory damages.
Wilson's litigation retention agreement (Fee Agreement) with the Law Firms
contains three provisions relevant to this appeal. The first provision states the Law
Firms will be reimbursed for certain costs and expenses. The second provision sets
forth varied contingency percentages based on the State's gross recovery, the type of
representation provided, and the court in which the matter was heard. The third
provision requires Wilson to seek judicial approval of attorneys' fees and costs
"[w]hen possible[.]"
The Law Firms continued to litigate on the State's behalf for more than four
years. On August 28, 2020, litigation ended with the execution of a settlement
agreement (the Settlement Agreement). The Settlement Agreement required the
DOE to immediately pay the State $600 million, "inclusive of interest, with each
party to bear its own costs, attorney fees, and expenses." Three days later, Wilson
announced he would pay the Law Firms $75 million in attorneys' fees pursuant to
the Fee Agreement. This amount included costs and expenses and represented
12.5% of the State's gross recovery.
Seeking to enjoin payment to the Law Firms, Appellants filed a complaint and
motion for preliminary injunction against Wilson. Appellants alleged that because
attorneys' fees were not awarded by court order or settlement, South Carolina Code
subsection 1-7-150(B) 1 requires the entire $600 million settlement to be deposited
in the State's General Fund. Appellants also argued the attorneys' fee amount was
patently unreasonable and, therefore, requires court approval. When Appellants
learned Wilson had already disbursed the $75 million,2 they amended their
complaint to name the Law Firms as defendants and filed another motion for
preliminary injunction.
Judge Alison Lee denied Appellants' motion and found they lacked public
importance standing. Specifically, Judge Lee concluded the critical element of a
"need for future guidance" was absent:
Any judicial ruling on this matter would be entirely limited to the [Fee
Agreement] and payment for services performed pursuant to this single
contract. . . . Public importance standing is inappropriate here because
there is no ruling the Court might make that would assist other courts
resolving future arguments regarding outside litigation.
Judge Lee also found Appellants lacked so-called "derivative standing" because
unlike Wilson, who has authority to represent the State as its chief legal officer,
Appellants "have no authority to represent the State['s] interests in this proceeding."
Respondents promptly moved to dismiss Appellants' complaint for lack of
standing. Judge Kirk Griffin granted the motion, ruling "Judge Lee's findings [as to
standing] are dispositive and require dismissal. . . . Nonetheless and in the
1
Subsection (B) provides, "All monies, except investigative costs or costs of
litigation awarded by court order or settlement, awarded the State of South Carolina
by judgment or settlement in actions or claims brought by the Attorney General on
behalf of the State or one of its agencies or departments must be deposited in the
general fund of the State[.]" (2005).
2
The fact that the fee has already been paid is irrelevant to the issues on appeal.
Likewise, the amount of the fee has no bearing on our analysis.
alternative, this Court . . . concurs with and adopts Judge Lee's well-reasoned
analysis and findings." Appellants appealed, and we certified the case for review.
Standard of Review
A motion to dismiss for lack of standing challenges the court's subject matter
jurisdiction. See Capital City Ins. Co. v. BP Staff, Inc., 382 S.C. 92, 99, 674 S.E.2d
524, 528 (Ct. App. 2009). Whether subject matter jurisdiction exists is a question
of law, which this Court is free to decide with no particular deference to the circuit
court. Id. (quoting Chew v. Newsome Chevrolet, Inc., 315 S.C. 102, 104, 431 S.E.2d
631, 631 (Ct. App. 1993)); Catawba Indian Tribe of S.C. v. State, 372 S.C. 519, 524,
642 S.E.2d 751, 753 (2007). Therefore, on appeal, we review the circuit court's
findings de novo. See Capital City, 382 S.C. at 99, 674 S.E.2d at 528; Catawba
Indian Tribe, 372 S.C. at 524, 642 S.E.2d at 753.
Discussion
If a plaintiff lacks standing, he does not have the right to proceed to the merits
of his claim against the defendant. Therefore, when a circuit court finds that a party
lacks standing and includes that finding in an order, the order determines a
substantial right. In this regard, Judge Lee's order does more than "merely decide[]
some point or matter essential to the progress of the cause, collateral to the issues in
the case[.]" Id. at 573, 743 S.E.2d at 785. However, because an order denying a
motion for preliminary injunction is interlocutory, see S.C. Code Ann. § 14-3-330(4)
(2017), Judge Lee's order did not finally determine a substantial right of Appellants.
Id.; see Rule 54(b), SCRCP; cf. Univ. of Tex. v. Camenisch, 451 U.S. 390, 395 (1981)
("[T]he findings of fact and conclusions of law made by a court granting a
preliminary injunction are not binding at trial on the merits."). Therefore, we decline
to invoke the law of the case doctrine. See State v. Hewins, 409 S.C. 93, 113 n.5,
760 S.E.2d 814, 824 n.5 (2014) (stating the law of the case doctrine "is a
discretionary appellate doctrine with no preclusive effect on successive trial
proceedings").
II. Standing
This Court has consistently acknowledged that even without an allegation of
particularized injury, "standing may be conferred upon a party when an issue is of
such public importance as to require its resolution for future guidance." Sloan v.
Sanford, 357 S.C. 431, 434, 593 S.E.2d 470, 472 (2004); see S.C. Pub. Interest
Found. v. S.C. Transp. Infrastructure Bank, 403 S.C. 640, 645, 744 S.E.2d 521, 524
(2013); ATC S., Inc. v. Charleston Cnty., 380 S.C. 191, 199, 669 S.E.2d 337, 341
(2008); Baird v. Charleston Cnty., 333 S.C. 519, 531, 511 S.E.2d 69, 75 (1999);
Davis v. Richland Cnty. Council, 372 S.C. 497, 500, 642 S.E.2d 740, 741-42 (2007);
S.C. Pub. Interest Found. v. S.C. Dep't of Transp. (SCDOT), 421 S.C. 110, 118-19,
804 S.E.2d 854, 859 (2017).
"The key to the public importance analysis is whether a resolution is needed
for future guidance." ATC S., 380 S.C. at 199, 669 S.E.2d at 341; see SCDOT, 421
S.C. at 119, 804 S.E.2d at 859; Vicary v. Town of Awendaw, 425 S.C. 350, 359, 822
S.E.2d 600, 604 (2018). Courts must cautiously balance competing interests—the
citizenry's need to hold public officials accountable for alleged injustices and "the
concomitant integrity of government action"—to determine whether the issue
presented is "inextricably connected to the public need for court resolution for future
guidance." SCDOT, 421 S.C. at 118-19, 804 S.E.2d at 858 (quoting Sloan v.
Greenville Cnty., 356 S.C. 531, 551, 590 S.E.2d 338, 349 (Ct. App. 2003)); ATC S.,
380 S.C. at 199, 669 S.E.2d at 341; see Sanford, 357 S.C. at 434, 593 S.E.2d at 472.
Only then can the issue "transcend[] a purely private matter and rise[] to the level of
public importance." ATC S., 380 S.C. at 199, 669 S.E.2d at 341.
By claiming Wilson improperly disbursed state settlement funds, Appellants
indisputably allege an issue of public importance. See, e.g., SCDOT, 421 S.C. at
119, 804 S.E.2d at 859; Sloan v. Sch. Dist. of Greenville Cnty., 342 S.C. 515, 524,
537 S.E.2d 299, 303 (Ct. App. 2000). Therefore, the linchpin of our analysis is
whether a need for future guidance exists.
Conclusion
We reverse the circuit court's finding that Appellants lack public importance
standing and remand for the circuit court to consider the merits of Appellants' claims.
We reiterate that nothing in this opinion should be construed as a comment or
conclusion on the merits.
REVERSED AND REMANDED.
BEATTY, C.J., KITTREDGE, HEARN and FEW, JJ., concur.
3
Litigation Retention Agreements, S.C. Att'y Gen., https://www.scag.gov/litigation-
retention-agreements/ (last visited July 28, 2022) (listing contingency fee
agreements for Opioid Manufacturers, Pharmacy Benefit Managers, Opioid
Distributors, Insulin Pricing, and Google Advertising Technology).
4
See Attorney General Alan Wilson: Drug Distributors and Johnson & Johnson
Commit to $26 Billion Opioid Agreement, S.C. Att'y Gen. (Feb. 25, 2022),
https://www.scag.gov/about-the-office/news/attorney-general-alan-wilson-drug-
distributors-and-johnson-johnson-commit-to-26-billion-opioid-agreement/.
5
Because we decide this appeal on public importance grounds, we need not address
derivative standing. See Futch v. McCallister Towing of Georgetown, Inc., 335 S.C.
598, 613, 518 S.E.2d 591, 598 (1999).