Climate Change Litigation

Top 6 at 6: Highlights of the Top Climate Change Legal Stories in the First Half of 2014

July 7, 2014 09:10
by J. Wylie Donald
Our semi-annual look at the top climate change legal stories is keyed on EPA.  You hardly have to have been awake to be aware of the Clean Power Plan and UARG v. EPA.  But other things have stirred the pot as well:  three reports – two by the Intergovernmental Panel on Climate Change and the other by Standard & Poor’s, and two climate change lawsuits – one by Illinois Farmers Insurance Company and the other by Biscayne Bay Water Keeper. 
 
1.  The Clean Power Plan - On June 6 EPA issued a 600+ page proposal directed at controlling carbon dioxide emissions from operating power plants.  By June 2016 States are required to submit plans for such control (there is also an option for extending the due date if more time is needed).  EPA’s press release summarizes what is supposed to happen:
 
The Clean Power Plan will be implemented through a state-federal partnership under which states identify a path forward using either current or new electricity production and pollution control policies to meet the goals of the proposed program. The proposal provides guidelines for states to develop plans to meet state-specific goals to reduce carbon pollution and gives them the flexibility to design a program that makes the most sense for their unique situation. States can choose the right mix of generation using diverse fuels, energy efficiency and demand-side management to meet the goals and their own needs. It allows them to work alone to develop individual plans or to work together with other states to develop multi-state plans.
  
Thus, the learning that has gone on over the past several years as embodied in RGGI, AB 32, RPSs and other state initiatives is going to have an opportunity to prove itself.

2. UARG v. EPA - The Supreme Court has now weighed in on climate change three times:  Massachusetts v. EPA, Connecticut v. American Electric Power and, this past month, Utility Air Regulatory Group v. EPA. – Readers will remember the D.C. Circuit’s 2012 ruling in favor of EPA defeating challenges to the Endangerment Finding, the Tailpipe Rule, the Timing Rule and the Tailoring Rule.  UARG was a limited appeal of that decision and accomplished nearly all that EPA required.  At the end of June the Supreme Court affirmed EPA’s greenhouse gas regulatory program, with the exception of rules focused on a small group of emitters.  How small?  Before UARG EPA estimated its rules would reach 86% of GHG emissions.  After UARG EPA can reach only 83%.  In a nutshell, EPA has authority under the Clean Air Act to impose GHG emission regulations on major emitters already subject to regulation.  This bodes ill for those seeking to challenge the Clean Power Plan.

3. Climate Science - The science continues to mount demonstrating the effects of climate change.  In two more contributions from the Intergovernmental Panel on Climate Change, Working Group II lays out in Climate Change 2014: Impacts, Adaptation, and Vulnerability “how patterns of risks and potential benefits are shifting due to climate change.”  The report also assesses how “impacts and risks related to climate change can be reduced and managed through adaptation and mitigation.”  In Climate Change 2014:  Mitigation of Climate Change Working Group III “respond[ed] to the request of the world's governments for a comprehensive, objective and policy neutral assessment of the current scientific knowledge on mitigating climate change." The two reports complement Working Group I’s report released last year, which concluded:  “It is extremely likely that human influence has been the dominant cause of the observed warming since the mid-20th century.”

4.  Climate Risk - It has been a common theme for this blog that acceptance of climate change will occur not because of science, but because of the responses of business entities that recognize that climate change denial is not in their best interest.  But it is also a theme that until there is an actual identified business reason to take an action, businesses will not go out on a limb.  Standard & Poor’s exemplifies our thinking.  In March it issued a short report, Climate Change is a Global Mega-Trend for Sovereign Risk.  In the report S&P concludes “the evidence suggests that it is probably safe to expect that for most national economies, other things being equal, climate change will negatively impact national welfare and economic growth potential.  Observations corroborating this expectation could lead Standard & Poor’s to lower sovereign ratings on the most affected sovereigns.”  That is, “we see a potential problem but we aren’t ready to act just yet.”  Notwithstanding S&P's failure to move today, this pronouncement does communicate to the buyers of sovereign debt that they had better pay attention to climate change as it may be material to their investment.

5.  Illinois Farmers Insurance Co. v. The Metropolitan Water Reclamation District of Greater Chicago  - It didn’t take Illinois Farmers long (less than 60 days) to drop its lawsuits against dozens of municipalities and other government entities alleging negligent management of stormwater.  The central feature was the claim that the government entities were on notice of the effects of climate change and did not incorporate them into their stormwater planning.  We presume the entities’ sovereign immunity defense persuaded Illinois Farmers to go quietly in the night.  But the insurance company has competent lawyers and sovereign immunity surely was no surprise.  So, was this the proverbial shot across the bow, putting government, and the entities that serve government – the design and engineering firms – on notice that climate change had better enter into their forecasts or they will be pursued for negligence?  Time will tell.
 
6. U.S. v. Miami-Dade County - Miami-Dade’s sewer insfrastructure is falling apart and EPA compelled the city into a consent order under the Clean Water Act to get things cleaned up.  Enter the intervenor, Biscayne Bay Waterkeeper, who insisted that the consent decree
was improper as it did not take rising sea levels caused by climate change into effect.  Federal district court judge Federico A. Moreno considered the consent decree and rejected it because it lacked sufficient incentive for the county to abide by the decree.  The court did not mention BBWK’s concern.  Nevertheless, Miami-Dade appears to have gotten the message that it needs to be paying attention.  The county has a task force devoted to sea level rise and it is preparing a report with recommendations.  This is from the April 28 minutes of the task force: 
 
Chairman Ruvin said that sea level rise was inevitable, and to ensure that the community remained insurable, it was important to begin implementing a plan to address this issue. … Chairman Ruvin noted the Task Force members had heard enough information to understand the necessity of developing a plan to address sea level rise.  He said that there were global engineering firms with entire divisions devoted to sea level rise, and suggested that the County conduct a competitive process to retain the services of some of these firms to develop this plan.

It remains to be seen, of course, whether the task force's recommendations will be accepted.

Whatever Happened to State Law Carbon Dioxide Liability Claims? Still No Music After Bell

October 27, 2013 10:30
by J. Wylie Donald

“Therefore, the Court declines to assert supplemental jurisdiction over the remaining state law claims which are dismissed without prejudice to their presentation in a state court action.”  So ends the last analytical paragraph in Native Village of Kivalina v. ExxonMobil Corp., 663 F. Supp. 2d 863 (N.D. Cal. 2009).  Thus, while plaintiffs’ federal common law carbon-dioxide-liability claims were extinguished on standing and political question grounds, state law claims could go forward should the plaintiffs choose to re-file.  Then, the Supreme Court decided American Electric Power Co., Inc. v. Connecticut564 U.S. __ (2011), and held a set of different plaintiffs’ federal common law claims were displaced by the Clean Air Act.  The Court specifically declined to rule on state law claims of the type at issue in Kivalina:  “None of the parties have briefed preemption or otherwise addressed the availability of a claim under state nuisance law. We therefore leave the matter open for consideration on remand.”

Last fall we relied on Bell v. Cheswick Generating Station, 903 F. Supp. 2d 314 (W.D. Pa. 2012), out of the Western District of Pennsylvania as support for the proposition that state law nuisance claims were futile – preemption by the Clean Air Act doomed such claims.  The Third Circuit's recent review, while reversing the trial court, has not upended our conclusion.

In Bell, 1500 neighbors of the 570 megawatt coal-fired Cheswick Generating Station operated by GenOn Power Midwest, L.P. became annoyed by ash and other contaminants allegedly settling on their property.  And so they brought a class action under Pennsylvania state tort law.  GenOn defended based on the comprehensive regulation of the Clean Air Act, which, it was asserted, preempted state law tort claims; the trial court agreed.

On appeal, however, broad preemption by the Clean Air Act was not accepted.  The Court of Appeals acknowledged the comprehensive program established by the Act.  But it also recognized that Congress had specifically provided for a citizens suit provision, 42 U.S.C. § 7604, and that the Act contained two "savings" clauses.  The first, the "citizen suit savings clause," provided:   "Nothing in this section shall restrict any right which any person (or class of persons) may have under any statute or common law to seek enforcement of any emission standard or limitation or to seek any other relief (including relief against the Administrator or a State agency)."  42 U.S.C. § 7604(e).  The second, the "states' rights savings clause," stated:  "Except as otherwise provided ... nothing in this chapter shall preclude or deny the right of any State or political subdivision thereof to adopt or enforce (1) any standard or limitation respecting emissions of air pollutants or (2) any requirement respecting control or abatement of air pollution ...."  42 U.S.C. § 7416.  Read together, a more restrictive state law could be enforced in a citizen suit.

This idea was consistent with the Cheswick Generating Station's permit:   "Nothing in this permit shall be construed as impairing any right or remedy now existing or hereafter created in equity, common law or statutory law with respect to air pollution, nor shall any court be deprived of such jurisdiction for the reason that such air pollution constitutes a violation of this permit."  

Could a citizen suit successfully address the ill-placed ash and contaminants?  The trial court said "no":  “Based on the extensive and comprehensive regulations promulgated by the administrative bodies which govern air emissions from electrical generation facilities, the Court finds and rules that to permit the common law claims would be inconsistent with the dictates of the Clean Air Act.”  But the Third Circuit said "yes." 

Its primary authority was the Supreme Court's 1987 decision in International Paper Co. v. Ouellette, 479 U.S. 481 (1987), a Clean Water Act case where Vermont plaintiffs asserted a (Vermont) common law nuisance suit in Vermont state court, where the pollution originated from a  New York facility.  To quote: 

The Ouellette Court found that the Clean Water Act's savings clauses clearly preserved some state law tort actions, but that the text of the clauses did not provide a definitive answer to the question of whether suits based on the law of the affected state were preempted. 479 U.S. at 492, 497. However, it found definitively that "nothing in the [Clean Water Act] bars aggrieved individuals from bringing a nuisance claim pursuant to the laws of the source State." Id. at 497 (emphasis in original). The Court reasoned that, "[b]y its terms the Clean Water Act allows States . . . to impose higher standards on their own point sources," and "this authority may include the right to impose higher common-law as well as higher statutory restrictions." Id. (internal citation omitted). The Court acknowledged that a source state's "nuisance law may impose separate standards and thus create some tension with the permit system," but explained that this "would not frustrate the goals of the Clean Water Act," because "a source only is required to look to a single additional authority, whose rules should be relatively predictable." Id. at 498-99. Thus, a suit by Vermont citizens would not be preempted if brought under the law of New York, the source state.

But, GenOn argued, the Clean Water Act and its savings clauses are distinguishable from the Clean Air Act and its savings clauses.  Not so said the court; "a textual comparison of the two savings clauses at issue demonstrates there is no meaningful difference between them."  Accordingly, the Bell plaintiffs, who brought suit as “Pennsylvania residents under Pennsylvania law against a source of pollution located in Pennsylvania,” were not preempted.

Now let’s return again to Kivalina.  The concurring opinion laid out the rule:   “Kivalina may pursue whatever remedies it may have under state law to the extent their claims are not preempted.”  Bell limits those claims.  Where Alaska natives sue in California a collection of greenhouse gas emitters from around the country, they would appear not to satisfy the requirement of emission-source-state-law-applies unless they are arguing that the nuisance rules of a score of jurisdictions must be considered.  In which case, their case falls apart for improper joinder.  And if they attempt to sue in multiple jurisdictions, they only amplify a fundamental flaw in their approach.  Whomever they sue has only contributed a tiny fraction of global greenhouse gases in either volume or over time and thus could not be the proximate cause of the Kivalina plaintiffs’ loss.  See Comer v Murphy Oil USA, Inc., 839 F. Supp. 2d 84 (S.D. Miss. 2012) ("[t]he assertion that the defendants’ emissions combined over a period of decades or centuries with other natural and man-made gases to cause or strengthen a hurricane and damage personal property is precisely the type of remote, improbable, and extraordinary occurrence that is excluded from liability.") 

Carbon dioxide liability plaintiffs may attempt to rely on the Third Circuit's decision in Bell to attempt to revive their litigation fortunes.  From our perspective, such attempts still won't ring the bell. 

Carbon Dioxide | Climate Change Litigation | Supreme Court

New Mexico Court Refuses to Take Steps to Apply Public Trust Doctrine to the Atmosphere

August 22, 2013 09:13
by J. Wylie Donald

By J. Wylie Donald and Patrick Reilly

Two years ago, we observed a potentially startling development in climate change litigation: “On Monday, May 4, [2011] in state courts across the nation lawyers representing children and young adults filed (and apparently will continue to file) suits seeking to compel State governments to recognize the application of the public trust doctrine to greenhouse gas emissions and to take action to abate those emissions.” These lawsuits were coordinated by two groups, Our Children’s Trust and Kids vs. Global Warming, and sought to apply the Public Trust Doctrine to the atmosphere. At the time, we pointed out that there were a host of issues to be resolved before these lawsuits could be successful. And so far, although the Public Trust Doctrine is now recognized in some jurisdictions as applying to the atmosphere, not one suit has been successfully concluded.  Recently, the New Mexico suit, although it survived a motion to dismiss, joined its unsuccessful brethren when the District Court granted a motion for summary judgment against the plaintiffs. 

In the case, Sanders-Reed v. Martinez, seventeen-year-old Aklilah Sanders-Reed sued New Mexico and Susana Martinez in her official capacity as governor for breaching their duty to uphold the public trust with respect to greenhouse gas emissions into the atmosphere. Asserting that “courts have emphasized the flexibility of the [public trust] doctrine to meet changing societal concerns,” Sanders-Reed and her lawyers argued in their complaint that “Governor Martinez has failed to use her authority for the protection of the atmosphere, a valuable public trust resource that belongs to present and future generations of New Mexico citizens.” Plaintiffs effectively hoped that, by applying the Public Trust Doctrine to the atmosphere, the state judiciary could order stricter greenhouse gas regulations.

In her June 26th, 2013 Order on Summary Judgment (attached), the Honorable Sarah M. Singleton noted the gravity of such a decision: “I think that in applying this Doctrine … the Supreme Court would allow the judicial branch to bypass the political process if there was an indication that the political process had gone astray.”  Citing an earlier case in Hawaii, Judge Singleton went on to conclude that, “the State may compromise public rights in the resource only when the decision is made with a level of openness, diligence, and foresight that is commensurate with the high priorities that the rights command under the laws of the state.”

With these conclusions in mind, the Court opined that even if the Public Trust Doctrine does apply to the atmosphere, invoking it to protect the atmosphere would stand at odds with New Mexico’s record of doing so legislatively.

The question is whether or not the State is ignoring its role in protecting the environment or the atmosphere. The State’s not ignoring it, it just disagrees with what the Plaintiff thinks is needed. So the State, in my opinion, has acted on this.

Now, is there the possibility under the Public Trust Doctrine that the State’s action could be so wrongheaded as to invoke the Public Trust Doctrine? I  suppose that in rare circumstances, it could. But I believe that before a court should jump in to apply a doctrine like the Public Trust Doctrine, there should be some showing that the process was tainted or that the public was foreclosed from pursuing the issue. That is not the case here.

Judge Singleton went on to explain that, by virtue of the state Environmental Impact Board’s public decision-making process, plaintiffs had not been denied their chance to participate in its findings on greenhouse gas emissions. She then asserted that regulation of greenhouse gas emissions is, “a political decision, not a Court decision,” before granting summary judgment.  With that decision, Sanders-Reed’s attempt to curtail New Mexico’s greenhouse gas emissions fell short at the trial court. But an appeal was filed on July 24th so it may not be over yet. (We note that Our Children’s Trust plaintiffs have a busy appellate docket.  Following losses at  the trial or intermediate appellate court, appeals are pending in Alaska, Oregon, and Washington also have pending appeals of litigation.  Losses on appeals in Arizona and Minnesota have not been further appealed.  They have appeals of regulatory petitions pending in TexasIowa, and Pennsylvania.)

As stated in Arizona Center for Law in the Public Interest v. Hassell, and repeated earlier this spring in the Arizona OCT appeal, Butler v. Brewer, "as an attribute of federalism, each state must develop its own jurisprudence for the administration of the lands it holds in public trust."  Our Children’s Trust may have extended that rule to the “administration of the [atmospheric resources held] in public trust”, but so far that has had no effect. 

20130704 Order on Summary Judgment (Sanders-Reed v. Martinez).pdf (410.72 kb)

Carbon Dioxide | Climate Change | Climate Change Litigation | Greenhouse Gases

Fourth Circuit Rejects Manipulation of Judicial Process As Ocean Manhandles Homes

August 19, 2013 22:56
by J. Wylie Donald


Can a community condemn shorefront cottages where the beach has eroded at 8 feet per year and the cottages interfere with emergency responders traveling along the beach?  Based on the Fourth Circuit's decision at the end of last month in Sansotta v Town of Nags Head we just don't know. What we do know is that a municipality cannot play both ends of the law against the middle to address the problem.

Let us explain.  Nags Head is a shore community of about 2500 souls (soaring to 40,000 in the summer) on North Carolina's Outer Banks. Municipal ordinances provide that a building suffering storm damage or erosion damage may be a public nuisance where it is in danger of collapsing, where there is a likelihood of personal or property injury, or where the structure is on public trust or public land.  Nags Head Ordinance 16-31(6) (a), (b), (c).  A 2009 storm washed away much of the sand around six cottages leaving their septic tanks exposed. The Town declared the cottages nuisances under Ordinance 16-31(6)(b) and (c) and required their abatement. Demolition was the only way to satisfy the ordinance but the homeowners did not comply and the Town assessed fines accruing at $100 per day.  The homeowners sued. (Twenty other cottages were also declared nuisances resulting in at least two other suits. See Town of Nags Head v. Toloczko, 863 F. Supp. 2d 516 (E.D.N.C. 2012); Town of Nags Head v Cherry, Inc., 723 S.E.2d 156 (N.C. Ct. App. 2012).)
 
The suit was originally filed in state court with claims sounding in both state and federal law. The Town removed to federal court.  Both parties moved for partial summary judgment.  The trial court dismissed and the homeowners appealed.

The Fourth Circuit affirmed the trial court's dismissal of the equal protection and procedural due process claims; however, the court of appeals reversed the trial court's dismissal of the takings claim.

Fourteenth Amendment Procedural Due Process.  Due process requires that before one is deprived of life, liberty or property, a constitutionally fair process must be imposed. Here, while the homeowners asserted constitutionally protected interests in the money to pay the fines and the cottages themselves, the Town never deprived them of those interests. First, the fines were never paid. Second, the Town's "regulatory actions do not constitute a deprivation of property because they represent limitations on the use of property that 'inhere in the title itself, in the restrictions that background principles of the State's law of property and nuisance already place upon land ownership.'" Sansotta at 14.  "By acting to abate what it believed was a nuisance, the Town simply kept the Owners from using their property in a way that was prohibited by law." Id. at 15. 

Fourteenth Amendment Equal Protection. The homeowners asserted that they were treated differently than the 14 other cottages that were also located in the public trust area. This was true but it did not matter. The Town had a valid reason for treating the cottages differently:  they were closer to the ocean and obstructed the passage of emergency vehicles to a greater extent.  "Notwithstanding the Owners' contentions about all parts of the beach being valuable, different parts of the beach may present different issues with regard to public safety.  Hence, the difference in the locations of the cottages on the beach is a legitimate basis for treating them differently."  Id. at 20. 

Fifth Amendment Takings. The homeowners asserted that their property was taken without just compensation. However, the homeowners had not completed the process of pursuing their compensation claim under state law. This was fatal to a federal claim, which required that a "plaintiff must first have sought compensation 'through the procedures the State has provided for doing so.'" Id. at 21.  In state court, however, the homeowners could assert a taking, even though they had not completed the compensation process.  "[U]nder San Remo Hotel[, L.P. v. City & Cnty. of San Francisco, 545 U.S. 323, 346 (2005)], a plaintiff may bring a takings claim in state court without having already been denied compensation by the state, if he also brings his state-law claim for just compensation." Id. at 23.  And here was the rub:  the Town had removed the case from state court, where the homeowners takings claim was ripe. But in so doing, the Town asserted the claim became unripe in federal court. Id. at 24.

The Court of Appeals was not willing to "judicially condone[] manipulation of litigation." Id. at 25.  The requirement for a federal court to wait until the state court has ruled on a just compensation claim, was a "prudential" not a "jurisdictional" requirement.  State courts have more experience in land use matters than federal courts, but that "does not mean that federal courts are incapable of handling them."  Id. at 25.  "A defendant implicitly agrees with this conclusion when he removes a case involving such a state or municipal law to federal court."  Id. at 25-26. Thus, the court refused to apply the state court litigation requirement and reversed the trial court's dismissal of the takings claim. "Based on our conclusion that a state and its political subdivisions waive the state-litigation requirement by removing a case to federal court, the district court erred in dismissing the Owners' takings claim as unripe." Id. at 35.

We find three things of moment in this case and its decision:

First, Nags Head is just one small community on the Atlantic littoral beset by rising sea levels. Yet it has spawned at least three cases that have been litigated to the appellate level.  We can expect many more.

Second, the issues in the rising sea level cases are going to get right down to fundamentals. Constitutional rights will be invoked. This of course suggests the Supreme Court will get involved. We note that it already has.  See Stop the Beach Renourishment, Inc. v. Florida, 560 U.S. 2606 (2010).

Third, one of the homeowners' takings claim was based on "redefining private property as public land." Id. at 21 n.16. Observe that the states own the land below mean high water (or mean low water in some cases). As the oceans rise, the states' claims to more and more of the current landowners' shorefront will increase. Is it the case, then, that that is a taking?  If it is, then states better start setting aside some substantial funds to pay just compensation that they cannot avoid. 

The front cover of this month's National Geographic premiers Rising Seas, How They Are Changing Our Coast Lines.  In North Carolina, they are living (and litigating) that.

Climate Change Effects | Climate Change Litigation | Regulation | Rising Sea Levels

Walking on Eggshell Skulls: Louisiana's Levees Take on the Oil and Gas Industry Over Coastal Land Degradation

July 24, 2013 23:20
by J. Wylie Donald

Ground zero for climate change and rising sea levels in the United States is not a status to which any state aspires.  Florida distastefully remembers 2005 when 4 hurricanes – Charley, Frances, Ivan, and Jeanne - roared ashore, all within six weeks.   Delaware worries that 8-11% of the state will be submerged by 2100.  Today we learned that Louisiana’s concerns over rising sea levels and hurricanes have resulted in an enormous lawsuit, Board of Commissioners v. Tennessee Gas Pipeline Co LLC, against 100 oil and gas companies based on their activities in Louisiana’s coastal lands over the last century, and the lands' ongoing demise.  “Unless immediate action is taken to reverse these losses and restore the region’s natural defense, many of Louisiana’s coastal communities will vanish into the sea.“  Complaint at 2.

The plaintiff, the Southeast Louisiana Flood Protection Authority – East, is a governmental entity whose ”mission is to ensure the physical and operational integrity of the regional flood risk management system.”  To accomplish that end, it concluded that in order for Louisiana's coastal communities to survive into the next century it needed to restore and rejuvenate Louisiana’s coastal lands.  Its complaint explains how the system is supposed to work:

5.2 Coastal lands, including wetlands and marshes, are an integral natural complement to the Authority’s man-made flood protection system. 
5.2.1.  Coastal lands are the first line of defense for south Louisiana’s communities against the destructive force of hurricanes. 
5.2.2. Those lands form a buffer that reduces the height and energy of hurricane storm surge and waves, thereby aiding the Authority in its mission to protect south Louisiana.
5.2.3. Hurricanes lose intensity as they travel over land.  Hence, the more land that a given hurricane must traverse before reaching Louisiana’s coastal cities, the weaker that hurricane’s impact on those communities, and concomitantly, the more effective the levee system.

Notwithstanding the coastal lands’ importance, they had been (allegedly) substantially degraded by the activities of oil and gas companies.  These companies had built a network of canals that was alleged to continue "to introduce increasingly larger volumes of damaging saltwater, at increasingly greater velocity, ever deeper into Louisiana’s coastal landscape and interior wetlands.  The increasing intrusion of saltwater stresses the vegetation that holds wetlands together, weakening – and ultimately killing – that vegetation.  Thus weakened, the remaining soil is washed away even by minor storms.”  Id. ¶¶ 6.7.1-7.2

With the loss of coastal lands, the levees stand to become “de facto sea walls,” a function the levee system is not designed for. Id. ¶ 5.11.

The Authority’s complaint sets forth the regulatory framework for commercial work in the coastal lands.  First, there is the Rivers and Harbors Act of 1899, which forbids “any person to … in any manner whatever impair the usefulness of any … work built by the Uniteds States for the preservation and improvement of any of its navigable waters or to prevent floods.”  As noted above, the loss of coastal lands would lead to impairment of the levees struggling to serve as seawalls.  Second, Clean Water Act permits impose obligations for the maintenance and abandonment of canals, and for the minimization of environmental harm.  The permits, it was alleged, had not been complied with.  Third, the Louisiana State Land Office granted rights-of-way, which carried with them maximum right-of-way widths and obligations to minimize environmental effects and to indemnify the State for third-party damages.  The defendants' rights-of-way had all allegedly eroded and now exceeded their permitted size.  Last, state and federal Coastal Zone Management Acts imposed additional obligations.  Id. ¶¶ 9.1-9.4. 

From that framework, the Authority argues a duty of care arises, breach of which by the energy companies supports a claim for negligence.  That claim is joined with claims for strict liability, public and private nuisance, third-party beneficiary rights, and a local favorite, natural servitude of drain.  Under the last claim it is asserted, damages and injunctive relief are owed because “Parties, such as Defendants, may not take actions that increase the flow of water across another party’s land, as the Defendants’ activities in Louisiana’s coastal lands certainly and demonstrably have done.”  Id. ¶ 23.

Commentary already circulating quotes the plaintiff's attorneys on the potential damages at  “many billions of dollars.”  Although the damages are very large, many will look at this as just another wetlands preservation lawsuit. 

We take a different perspective.  The destruction alleged took place over a very long time, by hundreds of entities, with the support of the commercial and political establishments of Louisiana.  The status quo in Louisiana was ongoing energy development in conjunction with degradation of coastal lands.  No one asserted that billions of dollars were owed.  What changed? 

A fundamental tenet of this blog is that climate change will create winners and losers.  The losers are not going to go quietly; instead, they will look around and see if they can be made whole by someone else.  The first wave of climate change liability cases sought to tag the emitters of greenhouse gases with liability; they were uniformly unsuccessful.  Is Board of Commissioners the vanguard of the next wave targeting for liability those entities whose activities make defending against climate change much harder?

There is a theory in tort about the eggshell skull.  As stated by the Seventh Circuit in Schmude v. Tricam Industries:  “If a tortfeasor inflicts a graver loss on his victim than one would have expected because the victim had some pre-existing vulnerability, that is the tortfeasor's bad luck; you take your victim as you find him.” 

Here the Authority might not have done anything, or done it much later, had climate change not exacerbated the dire conditions faced by Louisiana.  Will Louisiana’s eggshell skull be a model for others seeking to be made whole for their losses from climate change?  Only time will tell.  In the meantime, visiting practitioners may wish to practice saying coquille d'oeuf.     

Climate Change | Climate Change Effects | Climate Change Litigation | Rising Sea Levels

Fifth Circuit Knocks Out Climate Change Liability Lawsuit Again

May 16, 2013 00:10
by J. Wylie Donald

Res judicata is one of those phrases learned in law school that seemed of limited utility. How often is someone going to bring the same claim twice?  Callow law students know little of the world.  The doctrine is frequently needed and, as was learned in law school, it can be used to dispose of a claim, even if the prior decision "may have been wrong or rested on a legal principle subsequently overruled in another case."  Federated Dep't Stores, Inc. v. Moitie, 452 U.S. 394, 398 (1981).

On Tuesday, the Fifth Circuit applied the hoary doctrine to snuff out (again) the seven-year old climate change liability saga of Comer v. Murphy Oil USA.  Comer was filed immediately following Hurricane Katrina and asserted that a long list of energy companies were responsible for the increased destructiveness of the hurricane because of their emissions of greenhouse gases.  The trial court disagreed and dismissed the case on standing and political question grounds.  On appeal, however, the plaintiffs convinced an appellate panel of the Fifth Circuit  to reverse the trial court.  Defendants asked for rehearing en banc, which was granted, resulting in the vacating of the panel decision pursuant to court rule. 

Then things got weird.  After the grant of en banc review, the en banc quorum then dissolved with an eighth recusal among the active judges.  With no quorum, the case could not be reviewed.  Because the panel decision was vacated, the trial court dismissal was valid.

Plaintiffs chose not to appeal to the Supreme Court.  Instead they sought mandamus, which was denied.  Plaintiffs then decided to file their claim again, not only by the same plaintiffs on the same theories, but against the same defendants.  The trial court had no difficulty dismissing their claims a second time, relying on res judicata, but also on the statute of limitations, the political question doctrine, preemption, proximate cause and standing.  Another appeal was filed; this time the panel did not side with the plaintiffs.  Instead, it ignored all of the bases for dismissal articulated by the trial court and settled on only one:  res judicata.

To apply, four elements must exist:

(1) the parties are identical or in privity;
(2) the judgment in the prior action was rendered by a court of competent jurisdiction;
(3) the prior action was concluded by a final judgment on the merits; and
(4) the same claim or cause of action was involved in both actions. Opinion at 7. 

Only the third element was disputed.  The court held that the trial court's first judgment was a final judgment because, although the panel reversed, that decision was vacated and thus had no effect on the trial court's decision.  Nor did the decision to grant rehearing en banc, nor the Supreme Court's denial of the mandamus motion.  And the trial court's decision was on the merits, notwithstanding that it was a jurisdictional (standing and political question) determination.  Opinion at 10.  Accordingly, res judicata applied; the dismissal was affirmed.

We expect that the precedential value of the court's decision will be limited.  However, its non-precedential value is huge.  A broad and expansive theory of climate change liability was asserted by well-funded and capable plaintiffs' counsel.  After a long journey it joined on the ash heap claims asserted by the State of California (California ex rel. Lockyer v. General Motors), claims by various attorneys general and public interest groups (Connecticut v. American Electric Power), and claims asserted by a Native American community (Kivalina v. ExxonMobil) (albeit nursing a petition for certiorari to the Supreme Court).  Petrochemical companies, automobile companies, coal companies and electric utilities are 4-0 on the climate change liability front, with no other cases out there. 

The unanswered questions from Comer are the following: 

Why didn't plaintiffs add new defendants?
Why didn't plaintiffs assert state law nuisance claims in state court rather than pursue them in federal court? 
Why didn't they appeal to the Supreme Court on the merits, rather than seek mandamus? 

These questions are decisions on strategy, and we likely will never know. Last, however, and most importantly, where are the new theories of liability?  Bueller?  Bueller?  

Climate Change Litigation | Supreme Court | Utilities

Climate Change Legal Theories: The Atmospheric Public Trust Doctrine Moves Another Step Forward

April 29, 2013 08:49
by J. Wylie Donald

One of the shibboleths of those following climate change litigation is the idea that new legal theories will be surfaced, fired in the furnace of litigation and then forged as the vehicle for addressing climate change in the courts.  The public trust doctrine is being hammered out in that direction.

Last month in Butler v. Brewer an appellate panel in Arizona considered a claim based on the theory that the atmosphere is subject to the public trust doctrine and that, therefore, the State of Arizona was obligated to take steps to address greehnouse gases and combat climate change.  Although the court affirmed the trial court’s dismissal of the suit, before reaching that conclusion it specifically rejected Arizona’s argument that greenhouse gas issues are non-justiciable under the doctrine.

Butler is one of a slew of cases and regulatory petitions against the federal and state governments orchestrated by Our Children’s Trust, a public interest organization based in Oregon.  We have commented on OCT previously.  Its success has not been overwhelming, or even any.  Not one court has concluded that a state or the federal government can be compelled to do anything. Yet, if the measure of success is whether one’s theory is more well-formed than previously, and whether one can cite more legal precedent supporting it, then OCT is moving its ball forward.  By our count, OCT has positive rulings on its atmospheric trust theory from Texas, New Mexico and now Arizona.

In Butler, the appellant raised only one issue:  "[w]hether the [public trust doctrine] in Arizona includes the atmosphere.”  The State of Arizona engaged that argument head on:  “the Doctrine does not include the atmosphere.”  Arizona also raised defenses of displacement, standing, and political question, among others. 

The court considered prior Arizona and federal precedent to set forth the scope of the doctrine:

First, that the substance of the Doctrine, including what resources are protected by it, is from the inherent nature of Arizona's status as a sovereign state. Second, that based on separation of powers, the legislature can enact laws which might affect the resources protected by the Doctrine, but is it up the to judiciary to determine whether those laws violate the Doctrine and if there is any remedy. Third, that the constitutional dimension of the Doctrine is based on separation of powers and specific constitutional provisions which would preclude the State from violating the Doctrine, such as the gift clause.

From those principles the court had no difficulty responding to Arizona’s argument that the doctrine did not apply to the atmosphere:  “we reject the Defendants' argument that the determinations of what resources are included in the Doctrine and whether the State has violated the Doctrine are non-justiciable.”  Further, “While public trust jurisprudence in Arizona has developed in the context of the state's interest in land under its waters, we reject Defendants' argument that such jurisprudence limits the Doctrine to water-related issues.” (Note, however, Presiding Judge Gemmill concurred separately and stated:  "the atmosphere is not subject to the public trust doctrine.")

Thus, “For purposes of our analysis, we assume without deciding that the atmosphere is a part of the public trust subject to the Doctrine.”  Unfortunately for the appellant, this was as far as the court was willing to go.  Appellant did not point to any violation of the Arizona Constitution or statutory law.  Such a violation was mandatory for the claim to succeed.

 Additionally, in 2010 Arizona’s legislature took strong steps to ensure that the regulation of greenhouse gases remained in its bailiwick, rather than any administrative agency’s.  A.R.S. 49-191 provides:

A. Notwithstanding any other law, a state agency established under this title or title 41 shall not adopt or enforce a state or regional program to regulate the emission of greenhouse gas for the purposes of addressing changes in atmospheric temperature without express legislative authorization.

Absent a ruling that A.R.S. 49-191 was unconstitutional, there was no order the court could issue that would be able to implement the relief appellant sought.  Accordingly, appellant had no standing.

Rome wasn’t built in a day.  The atmospheric public trust doctrine hasn’t been either.  But construction continues. 

Carbon Dioxide | Climate Change Litigation | Greenhouse Gases | Legislation

Native Village of Kivalina Files Its Petition for Certiorari - A Five-Year Climate Change Litigation Marathon That Has Yet to Start

March 15, 2013 08:54
by J. Wylie Donald

One day short of five years since the case was originally filed, on February 25, 2013 the plaintiffs in Native Village of Kivalina v. ExxonMobil Corp. attempt once more to get out of the starting blocks, this time with a petition for certiorari  to the United States Supreme Court.  This follows dismissal by the Northern District of California in 2009, affirmance of the dismissal by the Ninth Circuit last September, and denial of a petition for rehearing en banc in November.   To be trite, it’s a marathon, not a sprint.  The response, if any, is due on April 3.  We can expect a decision on the petition a few weeks after that. 

The substance of the petition was easily predicted.  The tension between Middlesex County Sewerage Authority v. National Sea Clammers Ass’n, 453 U.S. 1 (1981), and Exxon Shipping Co. v. Baker, 554 U.S. 471 (2008), and mentioned by the concurrence (Judge Pro, sitting by designation on the Ninth Circuit) is the center of the argument.  Indeed it is the only issue behind the question presented:  “Whether the Clean Air Act, which provides no damages remedy to persons harmed by greenhouse gas emissions, displaces federal common-law claims for damages.”

According to the petitioners, the starting point for the analysis is the Court’s 1981 decision in Milwaukee v. Illinois, 451 U.S. 304 (1981) (“Milwaukee II”), where Illinois sought to enjoin Milwaukee’s federally permitted Clean Water Act discharges using the federal common law of nuisance.  Petition at 7.   In rejecting Illinois’s claim, the Court “focused carefully on whether the statutory scheme ‘spoke directly’ to the plaintiff’s ‘problem,’ and whether the statute gave the plaintiff a means ‘to protect its interests.’”  Id. at 8. 

The same year, however, the Court also, according to petitioners, issued Middlesex, a decision sharply diverging from Milwaukee II. In Middlesex, fishermen aggrieved by ocean dumping were found to have no federal common law remedy because “’the federal common law of nuisance in the area of water pollution is entirely pre-empted by the more comprehensive scope’ of the [Clean Water Act].” Id. at 10.

These two threads came together 27 years later in Exxon Shipping, where the Court “departed from any broad reading of Middlesex and returned to the more pragmatic and careful analysis of Milwaukee II.”  Id. Or maybe not.  Kivalina in candor also acknowledged:

To be sure, it is possible to read Middlesex narrowly so as to reconcile the decision with Exxon Shipping.  Given Exxon Shipping’s statement that Middlesex is limited to situations where “plaintiffs’ common law nuisance claims amounted to arguments for effluent-discharge standards different from those provided by the CWA,” then it appears that a federal common law damages claim is displaced only where it is so inextricably intertwined with claims for injunctive relief that it amounts to second-guessing of the prospective statutory standards.  Id. at 11-12.

Petitioners tied up their arguments with reference to American Electric Power v. Connecticut, 131 S. Ct. 2527 (2011) (“AEP”), the case that established that greenhouse gas claims were displaced by the Clean Air Act.  AEP, it was asserted, “pointedly did not follow Middlesex in concluding that the whole 'federal common law of nuisance is entirely' displaced by a 'comprehensive' regulatory scheme, which would have made for a much shorter, and very different, AEP opinion.” Petition at 12.  Instead, the gravamen of AEP was that the displaced claims were those that would have interfered with EPA’s authority.  Id. at 13.

In sum, “Milwaukee II, Middlesex, Exxon Shipping and AEP cannot all be correctly decided, yet all of them are viewed as good law – a conundrum that Judge Pro acknowledged in his opinion concurring in the result and that ultimately led him, and the other members of the panel, to a result in this case that is at odds with the fundamental rationale for displacement and with basic fairness.”  Id. Stated differently, Exxon Shipping permitted common-law damages even though the Clean Water Act displaced claims for injunctive relief.  This was to be contrasted with Middlesex, which “held that  a federal common-law damages claim was displaced by the Clean Water Act.”   Id. at i.  We expect that the Kivalina defendants will have a different point of view.

The second part of the petition is the analysis of why the case is so important that the Court should hear it.  Kivalina gave four reasons:

1.  Climate change is an extremely important subject.  In a pointed salvo, petitioners cited to the petition for certiorari in AEP, where some of the same defendants stated “’The questions presented by this case are recurring and of exceptional importance to the Nation.’”
2. Displacement presents a fundamental question of boundaries between the legislative and judicial branches.
3. GHG emissions claims are “inherently important because of the extraordinary nature of global warming.” 
4. Kivalina’s very existence is at stake.

Notwithstanding all that, the odds of the petition being granted are long.  The Court only accepts between 100-150 of the more than 7,000 cases it is asked to review each year.  That is less than a 2% chance, all things being equal.   Greenhouse gas emissions were on the Court’s docket in 2007 (Massachusetts v. EPA) and again in 2011 (AEP v. Connecticut).  While we agree that climate change cases are important; we are skeptical that this narrow issue (displacement of damages, when the Court has already ruled on displacement of injunctive relief) justifies a place at the finish line, marathon or no.

Climate Change Litigation | Greenhouse Gases | Sustainability

Top 6 at 12: Highlights of the Top Climate Change Stories in the Second Half of 2012

December 31, 2012 11:59
by J. Wylie Donald

2012 has drawn to a close.  We chronicle here six of the most significant stories on the climate change front in the last six months.  For those looking for hope that government is taking action to rein in greenhouse gas emissions, the focus is on California, where cap-and-trade stepped into reality with California's first emissions auction.  Nationally and internationally regulation is at a standstill or going backward.  In the courts, the climate change liability plaintiffs were pounded again as the Ninth Circuit confirmed the dismissal of Native Village of Kivalina v. ExxonMobil Corp.  Responding to climate change, however, is a different story.  Superstorm Sandy was a wakeup call on adaptation and the impacts of extreme weather; the National Flood Insurance Program managed to obtain statutory authority to include climate change in its considerations.

1.  Superstorm Sandy –  Climatologists are confident that the changing climate will lead to more frequent and more severe storms.  Sandy, following Hurricane Irene the previous year, delivered on both predictions.   A nine-foot storm surge at Battery Park.  Transformers exploding and putting Manhattan into darkness.  The Hoboken PATH station  submerged.  $50 billion in damage.  Superstorm Sandy set records and was completely consistent with the concerns of proponents of climate change mitigation and adaptation.  Did it have anything to do with climate change or was it simply a chance confluence of events?  The weather pattern was unusual.  There was a hurricane (albeit fading), coupled with a nor’easter, intersecting with an arctic high pressure front, under a full moon.  Individually, those are independent of climate change.  But there was also a record lack of sea ice, which has a measured and observed effect on global atmospheric circulation, which could result in severe weather coming together more severely.  So quite possibly Sandy is a result of climate change.  More important than the academic debate, however, is the impact on adaptation.  Regardless of one’s views on climate change, Sandy demonstrated that a major metropolitan area is vulnerable to extreme weather.  Steps will be taken to flood-proof subways, bury electric lines, raise seawalls, improve evacuation plans  and emergency response,  etc.  All of these are part of the steps needed to adapt to climate change.   Whether it is acknowledged as linked to climate change or not (but see Bloomberg Business Week cover following Sandy:   “It’s Global Warming, Stupid!”), adaptation is going to happen. 

2.  Presidential Election - Climate change was an important part of the campaign:  "The Obama-Biden cap-and-trade policy will require all pollution credits to be auctioned, and proceeds will go to investments in a clean energy future, habitat protections, and rebates and other transition relief for families."  The 2008 election campaign that is. It was a completely different position in 2012. Or maybe not different at all.  No one could tell because nobody was talking about it.  Even Sandy wasn't enough to propel climate change into the debate in the last week of campaigning.

3.  Native Village of Kivalina v. ExxonMobil - The last filed of the original quartet (American Electric Power, General Motors, Comer, and Kivalina) of climate change nuisance cases, Kivalina finally made it to a federal appellate court, where in September it met the same fate as its brethren:  dismissal affirmed.  Plaintiffs asked for rehearing.  The Ninth Circuit wasn't interested.  As of this writing, the only case left is Comer v. Murphy Oil USA, which is on appeal following its dismissal last March (for the second time) by the Southern District of Mississippi.  According to that court, plaintiffs lose for a wide variety of reasons:  standing, political question doctrine, res judicata, collateral estoppel, displacement, statute of limitations and proximate cause.   

4.  Cap-and-trade - California, alone among the fifty states, instituted its multi-industry full-fledged cap-and-trade program auctions in November.  All of its allowances for 2013 were sold at a price slightly above the mandated floor price of $10/ton.  Regulators and environmental groups hailed the auction as a success; some business groups were less enthusiastic.  The California Chamber of Commerce sued the California Air Resources Board to invalidate the auctions.  Meanwhile, the Regional Greenhouse Gas Initiative in the northeast continues with its allowances trading at the floor price, and with less than 2/3 of its allowances selling in its August and December auctions.  Some commentary concludes that it is time for RGGI to shut down as its CO2 emission goals have been met.    From where we sit, RGGI's success or failure can't be judged until its carbon trading is done in connection with  a robust economy.  The world economic malaise suppresses business, and with it, carbon dioxide emissions.  California may face the same issue.  

5.  National Flood Insurance Program Reform - Could a poisonously partisan Congress vote for this: 

(1) IN GENERAL- The Council shall consult with scientists and technical experts, other Federal agencies, States, and local communities to--(A) develop recommendations on how to--(i) ensure that flood insurance rate maps incorporate the best available climate science to assess flood risks; and (ii) ensure that the Federal Emergency Management Agency uses the best available methodology to consider the impact of--
(I) the rise in the sea level; ..."?  

Not the Congress we know.  Or so we thought.  Somehow, somewhere, someone put this into a draft, which made it into and out of a committee, ended up on the floor of both houses, survived two votes and came out as an enrolled bill for the president's signature.  The president signed it into law in July.  This was part of the miscellaneous section of the Moving Ahead for Progress in the 21st Century Act  (aka the Transportation and Student Loan Bill), which may explain how this occurred.  In any event, climate change considerations are statutorily mandated as part of the NFIP.  42 USC § 4101a(d)(1).  We can expect a report by July 6, 2013.  Id. § 4101a(d)(1)(B).  Who'd have thunk? 

6.  Global GHG Regulation - COP-18, the Conference of the Parties to the United Nations Framework Convention on Climate Change, wrapped up in Doha, Qatar in the middle of December widely panned as ineffective.   While it extended to 2020 the Kyoto Protocol addressing global greenhouse gas emissions, major nations (Canada, Russia, Japan and New Zealand) dropped out, and the United States continued to refuse to participate.  Thus, only about fifteen percent of global emissions are now covered by the protocol (the EU and other European nations, as well as Australia, continue to support the protocol).   Developing nations (whose emissions are not restricted by Kyoto) had hoped to obtain commitments for funding "climate finance" of $100 billion, but that did not occur either.  One can see parallels between the Kyoto Protocol and the Western Climate Initiative and RGGI.  In all three members have dropped out and the commitment to address greenhouse gas emissions waivers. 
 
The fiscal cliff was the focus at the end of 2012; climate change got short shrift.  2013 may establish that that was short-sighted.

No En Banc Appeal in Kivalina; So What's Next for Climate Change LItigation?

December 8, 2012 22:18
by J. Wylie Donald

When we discuss climate change litigation with colleagues or acquaintances unfamiliar with it, they are always a little incredulous.  “The plaintiffs allege what?  How could you prove that?  There's no way they can win.”  Courts, however, cannot rule from their impressions; instead, they must parse arguments and facts and explicate the legal reasoning that supports shutting climate change cases out of the courtroom.  We have addressed in this blog many of those decisions as the climate change cases have wound their way up the appellate ladder.  That statement-of-reasons rule, however, does not apply when a court is being asked to grant rehearing en banc.  Then a judge can just say, “I’m not interested.”  And the case is done.

That happened at the end of November in Native Village of Kivalina v. ExxonMobil Corp. when the Ninth Circuit issued its denial (see attached) of plaintiffs' petition for rehearing:  “The full court has been advised of the petition for rehearing en banc, and no judge of the court has requested a vote on the petition for rehearing en banc.  Appellants’ petition for rehearing en banc is DENIED.”  Unless the plaintiffs file a petition for certiorari with the Supreme Court, and the Court accepts it (which we think unlikely with no circuit court split and the dismissal being a fairly simple extension of the Court's decision in American Electric Power), Kivalina is done.  That means that there is no federal common law of nuisance relevant to greenhouse gas emissions whether a plaintiff seeks injunctive relief or damages.  The federal Clean Air Act displaces the claim in both instances. 

Two slim reeds remain for plaintiffs in the first wave of climate change litigation.  First, they need to prevail on an appeal before the Fifth Circuit in Comer v. Murphy Oil USA, Inc., which will require overcoming over half a dozen independent bases for dismissal found by the trial court.  Or second, they must succeed on a state-law-based theory of nuisance.  As we have noted recently, the Clean Air Act is likely to be found to preempt such claims. 

In light of the string of defeats in American Electric Power, Comer and Kivalina for plaintiffs, we went looking to see where the climate change plaintiffs' lawyers were going next.  The websites of the lead Comer and Kivalina lawyers, Gerald Maples and Matt Pawa, were not helpful.  However, journalist Andrew Longstreth didn’t rest on the websites; he reached out directly to Messrs. Pawa and Maples. Here is the future he found: 

"Pawa said that he and his co-counsel in the Kivalina case are discussing their options, which include asking the Supreme Court to hear an appeal or filing a new case in state court that asserts state common law claims. Pawa likened the current state of climate change litigation to the early stages of suits against cigarette makers and companies with asbestos liability. Before plaintiffs' lawyers in those cases were able to win judgments and settlements, they were stymied by defense arguments. "We haven't exhausted our theories or our efforts," he said.

As stated above, the Supreme Court and state law nuisance paths do not seem likely to succeed.  Mr. Maples suggested a different path:

"Future success in climate change litigation, he said, may depend on whether state attorneys general get involved, as they did in the tobacco litigation of the 1990s. With home insurance premiums rising as a result of climate change, Maples said, the litigation could become attractive to state AGs, who like consumer protection cases.  'If you can't afford insurance, that's almost like not affording food,'"

So, is climate change litigation going to take a new turn and become an issue about consumer protection and insurance rates?  After reviewiing the Fourth Amended Complaint in Comer, we suggested in 2011 that this theory was something that bore watching.  Here is the theory in action as alleged in Comer:  “[Defendants' greenhouse gas emissions] put Plaintiffs' property at greater risk of flood and storm damage, and dramatically increase Plaintiffs' insurance costs." (Fourth Amended Complaint ¶ 37.)   Thus, with the demise of federal common law claims, consumer protection law claims may be the next wave. 

20121127 Order (denying rehearing en banc), Kivalina v. ExxonMobil.pdf (34.55 kb)

Carbon Emissions | Climate Change Litigation | Insurance


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