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As more and more localities sue the fossil fuel industry, a critical battle is coming to a head. Localities and corporations are going to war over, well, where exactly they’ll be going to war. As we reported last October, many of the cases involve state law violations against the oil companies such as nuisance, trespass, product liability, and consumer protection.
Cities and states suing oil companies want to keep these cases in state courts, while corporations want to duke it out in federal courts where they likely have the upper hand.
On Tuesday, the Supreme Court will hear arguments on this issue in BP Plc v. Mayor & City Council of Baltimore, which could determine whether or not oil companies are held accountable for climate change damages to cities and states.
Why This Matters: If SCOTUS rules in favor of BP, future climate litigation will likely be fought in federal courts, which experts say are “less responsive to expansive legal theories,” and thus less likely to rule in favor of these innovative new climate cases based on state law. Whoever wins this case will have a leg up in future climate litigation.
Ready Player One?
When Baltimore sued in 2018, BP argued that because the federal government directed a portion of the company’s oil and gas production, the case belonged in federal court. A federal judge disagreed, but due to the nature of the “federal jurisdiction argument,” the state courts allowed an appeal, sending it further up the ladder. Now BP, Shell, ExxonMobil, and others hope that a win in the Supreme Court will strand climate litigation in state courts and force cases into federal court even on state law claims.
Phil Goldberg, special counsel for the industry-aligned Manufacturers’ Accountability Project, argued that “developing national energy policy is a legislative and regulatory matter and should not be driven by a number of state court judges across the country based only on a narrow set of allegations.”
Ready Player Two?
Baltimore argues that Big Oil is trying to shoehorn a broader issue into the case to move it to federal courts.
Many other localities have launched similar legal actions, and wait with bated breath to see how this case will end. In October, Maui sued ExxonMobil, Chevron, Shell, and ConocoPhillips for the cost of the city’s “measured retreat” from rising sea levels. RI, CA, and CO have all filed Supreme Court petitions for their own cases, which will have to abide by the Baltimore precedent.
What Will the Biden Administration Do?
A case about the extent of federal jurisdiction might have been of interest to the Biden administration. Federal climate litigation is about to change regardless. Other litigation relevant to climate change is likely to get a quick review and reversal once the Biden team is in their seats at the Justice Department. Already lawyers at the Department are backing away from defending cases challenging Trump administration environmental rules and rollbacks. For example, attorneys there recently said they don’t know what role they will play in a lower court dispute over an Obama-era methane emissions rule. Experts expect the Biden administration to take a much different approach to federal litigation than the Trump administration. The BP Plc v. Mayor & City Council of Baltimore decision may determine how the Biden administration handles climate litigation, or if it gets involved in these state law cases at all.
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