Lawsuits Seeking Damages for Climate Change Face Critical Legal Challenges

Big oil and gas companies maneuver to steer the lawsuits into federal court, setting the stage for a possible showdown in the U.S. Supreme Court.

Jan 28, 2020
U.S. Supreme Court Building in Washington, D.C. Credit: Mark Wilson/Getty Images

Lawsuits seeking damages related to climate change may have their day in the U.S. Supreme Court, creating a precedent that could favor fossil fuel companies for years to come. Credit: Mark Wilson/Getty Images

With a dozen state and local governments in court seeking damages related to climate change from fossil fuel companies, the U.S. Supreme Court may be the final stop for an  industry seeking protection from billion dollar verdicts.

At some point, one of the lawsuits is likely to drop into the lap of the high court and its newly cemented conservative block of justices.

Rhode Island, Baltimore, tiny Imperial Beach, California and the other localities for the most part want the cases tried in state court and out of federal jurisdiction, arguing that climate-induced extreme weather linked to oil and gas consumption has led to billions in property damage and huge remediation costs. 

ExxonMobil, Chevron, Phillips 66 and the other oil and gas giants, on the other hand, have gone to federal court over the issue of jurisdiction, arguing that the Clean Air Act and other federal laws preempt any claim under state law that carbon dioxide emissions from fossil fuels cause climate change and related property damage.

 

On both sides, the stakes couldn't be higher. The localities and a 13th plaintiff—the Pacific Coast Federation of Fishermen's Associations—want to make the fossil fuel industry responsible for the cost of sea level rise, more intense wildfires, hurricanes and flooding that climate scientists attribute to a warming planet. 

The energy companies want the opposite—protection from those costs in the form of court rulings that could go all the way to the  Supreme Court, holding that global issues like climate change have no business being litigated in either state or federal court. If the high court concurs, it could set environmental, social, political and economic precedents for generations.

The 13 climate cases are all now pending federal appeals court rulings that address the jurisdiction question, not the substantive issues linking the fossil fuel companies to climate change. Two cases addressing the question of whether they should be heard in state or federal courts have been argued before federal appellate courts, with rulings expected before summer. Hearings have been scheduled over the next few months for most of the other cases.

Legal experts believe the first significant test in the high court could come after one of the federal appeals courts renders an opinion on the jurisdiction issue.  The energy companies are counting on a high court ruling that blocks the lawsuits on jurisdictional grounds. That way, the core climate change issues raised by the municipalities will never even be considered.

"They will argue the cases should all be summarily thrown out," said Pat Parenteau, a professor of environmental law at the Vermont Law School. "They're counting on the conservative justices being willing to slam the door on climate cases." 

The cities, states, counties and fishermen's associations that are plaintiffs in the suits are trying to build the case that fossil fuel companies knew of the dangers created by their products and failed to warn the public, thereby imposing huge costs on communities that have to deal with the impacts of sea level rise and other consequences of climate change.

This focus on the conduct of the fossil fuel producers differs from earlier climate cases in which plaintiffs focused on emissions, and blamed the utility and fossil fuel industries for producing the greenhouse gases warming the planet. The Supreme Court ruled in response to those suits that emissions were governed under the Clean Air Act, and as such, were not matters for the courts to consider. 

But the high court has also said that there may be a basis under state common law for some of the more recent cases. 

It's over the issue of jurisdiction that the industry will wage its most fierce fight, said Katherine Trisolini, a Loyola Law School professor specializing in climate change and energy law. 

The Supreme Court is much more likely to consider this procedural question, she said, than to weigh in on matters of substance related to the claims made in the various lawsuits.

"The jurisdiction question is a bit more clear for review," Trisolini said. "That's where the door is most widely open for a Supreme Court review."

Almost as soon as the lawsuits were filed, the fossil fuel companies began the fight to have the cases heard in federal court where the companies believe—on the basis of the earlier rulings on emissions—that they have the advantage.  

The companies are arguing that, while the local governments might have fashioned their complaints under state law, they actually involved issues best decided by a federal court, where precedent favors the companies.

But so far, the industry's efforts to get the climate suits out of the state courts have been largely unsuccessful, setting the stage for the federal appeals. In all but two of the 13 cases, federal district court judges have agreed that the lawsuits should be heard in state courts guided by various state laws. 

A federal judge in San Francisco has been the exception, rejecting lawsuits filed by San Francisco and Oakland on the grounds that state courts were not the proper place to deal with global issues like climate change. 

"The problem deserves a solution on a more vast scale than can be supplied by a district judge or jury in a public nuisance case," U.S. District Court Judge William Alsup wrote in his opinion.

Meanwhile, six other California lawsuits, filed by the cities of Imperial Beach, Santa Cruz and Richmond; and the counties of San Mateo, Marin and Santa Cruz, remain in state court after U.S. District Court Jusge Vincent Chhabria ruled that was the proper jurisdiction. 

Similarly, U.S. District Judge Ellen L. Hollander in Maryland, ruling on Baltimore's climate suit, wrote that the industry's desire for federal jurisdiction was nothing more than a "hijacking" of state authority.

To allow the case to move forward in federal court "enhances federal judicial power at the expense of plaintiffs and state courts," Hollander wrote. 

She went on to explain that the public nuisance claims alleged by the city could only be decided in a state court. The city, she noted, "nowhere even alleges that the defendants violated any federal statutes or regulations."

The industry didn't like that slap down, and sent its lawyers to the Supreme Court for help, as it did after two other similarly adverse rulings. They argued before the high court that state cases should not be allowed to move forward until the federal appellate courts resolve the jurisdictional questions about where climate nuisance claims belong.

Industry lawyers told the high court, "It's difficult to imagine claims that more clearly implicate substantial questions of federal law and require uniform disposition than the claims at issue here." The lawsuits," they added, "seek to transform the nation's energy, environmental, national security and foreign policies by punishing energy companies for lawfully supplying necessary oil and gas resources."

The high court didn't bite, however. It declined to take up the issue, though the refusal cannot be interpreted as a tip of the court's hand one way or the other as to whether the justices will eventually invite an appeal.

If they do, the conservative majority on the high court may seize on the larger question of separation of powers, reasoning that the judiciary should not be part of a resolution to such momentous matters, said Parenteau, of the Vermont Law School, who has consulted on several of the climate cases.

In taking up any review, the justices may say, "Courts simply have no business adjudicating disputes over a global problem like climate change," he said. "The oil industry is providing a vital service to the nation and the world. There is no obvious alternative. What to do about all this is a matter for Congress and the Executive Branch."

He added: "In other words—the industry's playbook."

Significantly, the high court's refusal to halt state-level proceedings, as the industry had asked, means the cases will go forward pending an appellate court ruling on the jurisdictional issue. 

That opens the door for the localities to obtain potentially explosive material in the discovery process related to the industry's knowledge of the links between fossil-fuel combustion and climate change.

If the industry does not prevail in the pending federal appeals, the Supreme Court may be reluctant to weigh in, said Ann Carlson, an environmental law expert at UCLA School of Law, who has consulted for some of the plaintiffs

"It's not clear these issues raised under state common law claims are the kinds of issues the Supreme Court may want to insert itself into," Carlson said.

The high court simply may feel that it's best left to the state courts to hash out the issues based on prevailing state laws, she said.

"The Supreme Court may look at this and say these claims do not raise federal, constitutional questions," Carlson said.

Nevertheless, she said, the cases will be "long fought," with the Supreme Court being asked to weigh in at times—and perhaps serving as the final arbiter.

"It's a roll of the dice each time," she said.

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