Oil industry seeks SCOTUS lifeline amid mounting setbacks

The Supreme Court is about to decide whether to get into another fight between fossil fuel producers and nearly two dozen U.S. cities, states and counties suing the industry for damages caused by climate change.

At issue on Wednesday — as the Supreme Court holds its first conference of a new term — is whether the court will grant the industry’s request to move from state to federal court lawsuits that seek to hold fossil fuel producers financially responsible for climate change.

It’s a dispute over venue with huge consequences, and it comes as a federal appeals court on Friday became the latest to signal skepticism about industry efforts to move the cases to federal court. , where producers believe they have a better chance of winning.

The Supreme Court, in a narrow decision last year, returned the cases to federal courts for review, and most federal commissions have since ruled that the suits should be heard in state courts (green wireMay 24, 2021).

Even Judge Richard Sullivan, who wrote a Decision 2021 for the 2nd U.S. Circuit Court of Appeals that found New York City’s claims in a climate lawsuit were preempted by federal law, expressed doubts on Friday as a lawyer for Exxon Mobil Corp. argued before the 2nd Circuit that a case brought by the State of Connecticut should be heard in federal court.

“Connecticut cannot contest, and its complaint clearly reflects, that it seeks monetary relief for, in its words, ‘catastrophic damage caused by global climate change,'” Exxon’s attorney said. , Kannon Shanmugam. The partner of Paul, Weiss, Rifkind, Wharton & Garrison LLP argued that the state was trying to regulate emissions regulated by the federal clean air law.

But while Shanmugam referred to Sullivan’s earlier decision in the New York case, Sullivan said the Connecticut and New York cases were “very different.” Sullivan noted that the New York case, unlike most other climate disputes, was originally filed in federal court (climate wireApril 2, 2021).

“Here we’re dealing with something very different, which is withdrawal,” Sullivan said of the Connecticut case. “And it’s a harder road to hoe under the kidnapping.”

Sullivan, an appointee of former President Donald Trump, also noted that “unless federal common law completely preempts the field, it seems to me there’s a real problem here, because we would generally trust to the state courts to resolve this issue”.

Shanmugam told the court that “the breadth of remedies” sought by the lawsuit “underscores that this is a lawsuit for injuries caused by greenhouse gases around the world.”

But Judge Myrna Pérez, appointed by President Joe Biden, told her that the companies appeared to be asking the court to craft “new laws”, including that an “overzealous appeal can somehow convert a lawsuit into ‘one state in one federal action’.

Judge William Nardini, another Trump appointee, said 40 years of case law regarding the withdrawal of cases makes it “pretty difficult to withdraw when someone has argued purely state claims.”

The Connecticut case alleges that Exxon violated the state’s Unfair Trade Practices Act by waging a “campaign of deception” that misled consumers about the climate impacts of its petroleum products (green wireSeptember 14, 2020).

Yet even as judges appeared unwilling to send the case to federal court, they suggested Connecticut may struggle to win compensation.

“They’re looking for all kinds of relief, but it could be split,” Sullivan said of the state’s claims. “The state court could say, ‘You are not entitled to all the damage caused by global warming over the last half century or the last two centuries.’ “

Connecticut Assistant Attorney General Benjamin Cheney told judges the state would seek to stop Exxon “from lying to Connecticut consumers,” but judges pushed him to explain how the state would connect Exxon’s lies to sales that otherwise might not have taken place.

Perez asked if the fact that the remedy sought is “a bit tenuous” helps the industry’s argument in that “it gives the impression that you are actually trying to regulate rather than get something concrete” .

Shanmugam noted that the Supreme Court will on Wednesday accept a request from Suncor Energy Inc. and Exxon to review a similar climate case filed in Colorado (climate wireJune 9).

“We may or may not have some guidance as to whether or not the Supreme Court thinks it should intervene at this point,” Shanmugam told the justices. “In our view, there are circuit disputes over these issues in this context, and more broadly. And so these are questions that I think, inevitably, the Supreme Court will have to resolve. »

It takes the votes of four judges to grant a petition, and the Supreme Court rejects most of the cases brought before it.

The fight over where climate liability lawsuits should be heard has stalled action for years as municipalities across the country have gone to court to seek payment from the oil and gas industry for the effects of emissions that warm the planet.

The lawsuits have mostly been filed in state courts, but the industry has sought to move them to the federal benches, where a judge could conclude that the municipalities’ claims are preempted by federal law.

The latest Supreme Court petition was filed in June by Suncor and Exxon asking the court to review a 10th US Circuit Court of Appeals decision that won three Colorado governments.

The industry argues that by taking over the Colorado case, the High Court could prevent climate liability cases from being allowed “to languish in state court indefinitely.”

The companies also say the Colorado case is “in a unique position” as the first to return to the Supreme Court after justices in BP PLC v Baltimore Mayor and City Council Last year, lower justices asked judges to consider a broader set of arguments for federal jurisdiction, awarding yet another victory to the oil and gas industry.

The 10th Circuit, which decided Colorado’s case, was the first to find that a climate liability action still rested with state judges after the Baltimore ruling dismissed all cases. Several other appellate courts have since followed suit and ruled in favor of the governments.

Industry lawyers, however, argued in the Supreme Court’s motion that “given the stakes of the climate change litigation, the issues presented here are among the most significant jurisdictional issues currently pending before the courts.” federal courts”.

Lawyers in Boulder, Colorado told the Supreme Court that judges should stay out of the dispute until there is a dispute between the circuit courts.

“If the petitioners are able to convince a circuit to accept their position, this court may decide to intervene at that time,” the Colorado lawyers told the court in August (climate wireAugust 11).

Government lawyers noted that the High Court last year rejected a plea by oil companies asking judges to find that climate liability suits brought by Oakland, Calif., and San Francisco belonged in federal court (green wireJune 14, 2021).

Suncor and Exxon have argued that the High Court sometimes agrees to “resolve disputes over federal issues, not disputes over the outcome of cases”.

And industry lawyers told the Supreme Court that the Colorado lawsuit involves a smaller group of defendants than other climate liability cases “and is therefore less likely than those cases to present recusal issues.”

Recusals became a problem when the Supreme Court ruled BP vs. Baltimore Last year. Judge Samuel Alito, who owns shares in two other companies involved in the Baltimore climate dispute, withdrew from the proceedings.

The American Petroleum Institute has urged the court to support Suncor and Exxon’s motion, arguing in a friend of the court brief that “the ad hoc and unpredictable decisions of individual state courts, seeking to govern the worldwide conduct of a handful of individual defendants , are not a sensible way to approach problems of this scope and magnitude.

Indiana Attorney General Todd Rokita and 15 other Republican attorneys general also appealed to court to address the issue, calling the climate lawsuits that have been filed in majority Democratic-run states a “threat to consistent law, politically responsible government and federalism.”

The attorneys general say that while state courts are “essential to addressing local harms resulting from local behavior, … their abilities to assess the costs and benefits of local economic activity make them ill-suited to impose standards for greenhouse gases emitted elsewhere, even if these out-of-state emissions have an attenuated local effect.

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