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Climate Lawsuits Poised to Create ‘Tobacco Moment’ for Big Oil

Nov. 6, 2021, 7:18 PM

Litigation will grow to be a tool to force multinational companies and governments to meet their climate commitments, attorneys and advocates said Saturday at the United Nations climate summit in Glasgow.

“There is obviously a ripple effect of these cases,” Roger Cox, a Dutch environmental attorney who successfully argued a case against Royal Dutch Shell plc,, said at COP26, the 26th meeting of the U.N. Framework Convention on Climate Change.

A Dutch court ordered Shell and its global subsidiaries to cut their greenhouse gas emissions 45% below 2019 levels by 2030.

“Everybody starts to believe if it can be done once, it can be done twice,” Cox said. This is “the tobacco moment” for oil and a “starting point” for global climate litigation against oil majors, which are at risk because they have operations worldwide, he said.

More governments and companies may be held liable for voluntary commitments made under the Paris agreement to ensure they protect human rights and do their fair share for the climate, attorneys and advocates said.

Basis for Litigation

There’s evidence that non-binding commitments may be used more often as a basis for litigation in some countries, Lavanya Rajamani, an international environmental law professor at Oxford University, said at COP26.

Two European court rulings, including the Shell case, have raised the prospects of successful climate-related legal action against local governments and multinational oil and gas companies, said Lucy Maxwell, senior legal associate at the Urgenda’s Foundation’s Climate Litigation Network in London, at the conference.

In another case, the Dutch Supreme Court ruled in 2019 that its government must drastically cut its emissions.

Courts are “expanding the notion of who can sue whom,” and are taking cases that challenge the adequacy of corporate and government climate commitments, Rajamani said.

Following the Dutch Supreme Court ruling against its government, more courts are likely to accept challenges to government climate commitments based on whether they’re doing enough in tempering fossil fuel production and consumption to account for climate impacts, she said.

Failure to do a “fair share” is a kind of “climate misconduct” in which a country or company doesn’t do enough to cut emissions compared to others, Maxwell said.

“Cases are being brought by all kinds of affected communities,” she said.

Those principals form the building blocks of other kinds of cases that challenge “individual infrastructure decisions, new coal mines, new oil and gas operations,” Maxwell said.

U.S. Impact?

Environmental lawyers in the U.S. disagree about the extent to which international climate rulings and pressure for emissions cuts applied at COP26 will have an effect on U.S. climate litigation.

“The Paris agreement is not likely to be applied directly in U.S. courts,” Daniel Bodansky, an international environmental law professor at Arizona State University, said in a phone interview.

Countries who have signed onto the Paris agreement must come forward with a commitment to slash carbon emissions known as a nationally-determined contribution. But they don’t have a legal obligation to achieve it, Bodansky said.

Last year, the U.S. Circuit Court of Appeals for the Ninth Circuit dismissed climate claims brought by 21 youth plaintiffs in Juliana vs. U.S., saying they didn’t have the authority to order the federal government to draw down fossil fuels production. A federal judge in Oregon is weighing arguments to allow the plaintiffs to proceed again to trial with an amended complaint.

Michael Burger, executive director of the Sabin Center for Climate Change Law at Columbia University, told Bloomberg Green in May that he expects the Shell verdict to result in similar lawsuits being filed in the U.S.

To contact the reporter on this story: Bobby Magill at bmagill@bloombergindustry.com

To contact the editor responsible for this story: Chuck McCutcheon at cmccutcheon@bloombergindustry.com

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