Alaska Conservation Foundation v. Pebble Limited Partnership, 350 P.3d 273

Background

Plaintiffs (Nunamta Aulukestai, a nonprofit representing Bristol Bay village corporations, and four individuals) sued the State challenging land/water‑use permits for the Pebble Project, seeking declaratory and injunctive relief that the State must provide public notice and "best‑interest" findings before issuing permits.
After the superior court ruled for the State and Pebble, the State and Pebble sought costs and attorney’s fees exceeding $950,000; plaintiffs invoked AS 09.60.010(c)(2) shielding unsuccessful constitutional claimants from adverse fee awards if the claim was non‑frivolous and the claimant lacked “sufficient economic incentive.”
The superior court found plaintiffs brought a non‑frivolous constitutional claim but concluded the State/Pebble made a prima facie showing that some plaintiffs had economic incentives and ordered broad discovery into plaintiffs’ finances and third‑party funders (Trustees for Alaska and Alaska Conservation Foundation), subject to confidentiality protections.
Plaintiffs and third parties petitioned this Court for relief from the discovery order; the Court consolidated review with a separate merits decision (in which the Court reversed on the constitutional claim and remanded), making plaintiffs prevailing parties for fee purposes.
The principal legal question resolved here: the meaning of “sufficient economic incentive” under AS 09.60.010 and whether the superior court erred by ordering broad discovery into plaintiffs’ and funders’ finances.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Meaning of “sufficient economic incentive” under AS 09.60.010	Statute follows prior public‑interest doctrine; plaintiffs lacked direct economic motive to sue	Plaintiffs (or their funders) had economic motives; discovery into funding is necessary to test incentive	Court adopts prior public‑interest meaning: ask whether litigation’s primary purpose was direct economic gain; plaintiffs lacked sufficient economic incentive
Scope of permissible discovery into third‑party funders	Third‑party funding is generally not discoverable when claimants lack direct economic incentive; discovery into funders burdens associational rights	State/Pebble: funding and funders’ motives are relevant to suss out economic incentive and possible control/stalking‑horse arrangements	Vacated superior court’s broad discovery order; third‑party discovery cannot be justified absent a showing funder’s direct economic interest or control over litigation
Relevance of indirect or subsistence interests as economic incentive	Protection of subsistence or indirect economic benefits does not constitute direct economic incentive	State argued subsistence protection or community economic interests show incentive	Court rejects subsistence/indirect benefits as “sufficient economic incentive”
Relevance of attorneys’ or plaintiffs’ fundraising/publicity as incentive	Attorney economic interests, fundraising, or publicity are not sufficient economic incentive to trigger fees	State/Pebble suggested various indirect incentives could support discovery	Court holds these are generally irrelevant to the statutory inquiry

Key Cases Cited

Gilbert v. State, 526 P.2d 1131 (Alaska 1974) (established public‑interest exception to adverse fee awards)
Anchorage v. McCabe, 568 P.2d 986 (Alaska 1977) (formulated three‑part public‑interest litigant test)
Kenai Lumber Co. v. LeResche, 646 P.2d 215 (Alaska 1982) (added economic‑incentive fourth prong; litigation primarily for direct economic gain defeats public‑interest status)
Kodiak Seafood Processors Ass’n v. State, 900 P.2d 1191 (Alaska 1995) (distinguished direct vs. indirect economic benefit; indirect benefit insufficient)
Gwich’in Steering Cmte. v. State, Office of the Governor, 10 P.3d 572 (Alaska 2000) (nonprofit seeking access to records lacked sufficient economic incentive)
State v. Native Village of Nunapitchuk, 156 P.3d 389 (Alaska 2007) (discussed legislative replacement of common‑law public‑interest doctrine with AS 09.60.010)