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Focus on ‘Greenwashing’ Claims in New Year of Climate Litigation

Dec. 27, 2021, 11:00 AM

While U.S. climate liability cases inch forward in procedural battles, experts are watching the horizon for novel “greenwashing” and human rights claims to expand the climate litigation landscape in 2022.

“I expect we will see new forms of climate litigation arise soon, both in terms of the classes of defendants targeted and the theories of liability pursue,” Yale Law School professor Doug Kysar told Bloomberg Law.

Lawyers and court watchers predict a rise in misleading or false advertising allegations around climate pledges, financial disclosure cases, and claims against industry and governments over their emission pledges.

These kinds of challenges have already begun to be tested in courts around the world, and human rights could be at the forefront of new claims, according to Lewis & Clark Law School professor Lisa Benjamin.

“We’re going to see, probably, more activity on the human rights nexus with climate change,” she said. “We’ve seen an uptick in that in the past year or two.”

In the U.S., climate litigation will inch towards resolution on long-contested jurisdiction questions over the proper venue for consumer protection lawsuits against oil and gas companies.

Connecticut Attorney General William Tong’s consumer protection case against a single company—Exxon Mobil Corp.—will likely see his case argued next year.

Climate change “is the existential crisis of our time,” Tong (D) told Bloomberg Law. “These cases are very strong, and we’re in it for the long run.”

False Advertising

Greenwashing, or the attempt to make products or practices seem more climate-friendly than they are, will be a hot topic in courts in coming months, experts note.

“Firms will be targeted for climate information failures, whether affirmative misrepresentations as in greenwashing claims or risk disclosure failures as in investor suits,” Kysar said in an email.

Net-zero pledges from large companies and countries also will be under the microscope for lawyers looking to bring cases, Benjamin said. This could be a problem for countries that “did not reflect their highest ambition” in their Paris Agreement Nationally Determined Contributions, she added.

“We are going to see some litigation around those commitments, particularly because a huge number of those commitments have no specific plans of how they will be implemented,” Benjamin said.

Benjamin also sees greenwashing claims likely hitting the advertising sector.

Danish activists this October won Denmark’s first-ever climate lawsuit against meat manufacturer Danish Crown, which was forced to drop “climate controlled” from its product descriptions for being misleading. A utility company in New Zealand was also the subject of a complaint to the country’s Advertising Standards Authority for claiming their “gas is going zero carbon too” in ads.

“We have already started to see some cases on advertising and advertising standards around the world, and some of them have been successful,” she said.

Agency Authority

The Environmental Protection Agency is working with a long list of promised regulations aimed at slashing emissions, including rules on greenhouse gas limits for existing power plants.

As the agency begins to roll those rules out, Benjamin expects to see groups and states suing over some of them, including new vehicle emission standards set to drop before the new year. There is a challenge already on the books over the newly finalized hydrofluorocarbon phase-out rule.

The Supreme Court is also expected to weigh in on EPA greenhouse gas authority next year, in a high stakes case looking to draw hard lines around how the agency can craft carbon rules for power plants.

Some see a verdict in favor of the mining groups and Republican-led states that petitioned the high court as a potentially devastating blow to the Biden administration’s ability to craft climate standards. Others hope that a verdict will provide regulatory certainty around the issue of greenhouse gas authority.

‘Heavily Scrutinized’

More U.S. procedural fights are expected in 2022 in climate consumer protection cases, with some movement on whether these cases will be heard in state or federal courts.

“For the carbon majors suits, we can expect venue to finally get sorted out,” Kysar said.

Cases against carbon majors—including Exxon, Chevron Corp., Royal Dutch Shell PLC, and BP PLC—remain locked in arguments over whether the cases can stay in the courts where they were filed. These cases have evolved from focusing on public nuisance claims over climate impacts like flooding, to using state fraud laws targeting companies’ alleged deceptive marketing for fossil fuel use.

A pair of consolidated Hawaii cases from Maui and Honolulu will have arguments in an industry company appeal of a state remand order on Feb. 18. Both cases also are proceeding through state courts following the remand order earlier this year.

Baltimore will see another round of appellate arguments on Jan. 25, after the Supreme Court ruled in May that circuit panels needed to look at a broader suite of arguments during oil company appeals, rather than just a single federal officer claim.

“The entire judicial system of the United States is looking at these cases,” David Bookbinder, an attorney involved in Denver’s climate lawsuit, told viewers at a recent event on climate consumer protection and nuisance cases.

“These are going to be the most heavily litigated and heavily scrutinized cases in American history, period,” he said.

To contact the reporter on this story: Jennifer Hijazi in Washington at jhijazi@bloombergindustry.com

To contact the editor responsible for this story: Rebecca Baker at rbaker@bloombergindustry.com