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Supreme Court Climate Ruling Crops up in Delaware Arguments (1)

May 19, 2021, 4:13 PMUpdated: May 19, 2021, 8:37 PM

Federal courts must grapple swiftly with the impacts of the U.S. Supreme Court’s new climate-related decision as related cases advance, a dynamic on display Wednesday as a judge in Delaware quizzed lawyers on the decision.

Judge Leonard Stark raised the fresh precedent in BP Plc v. Mayor and City Council of Baltimore, issued Monday, while weighing arguments from lawyers for the oil industry and Delaware on whether climate litigation belongs in state or federal court.

The decision reopened an appeal in a similar venue conflict in the Baltimore case against BP, Exxon Mobil Corp., and other oil majors. Similar cases are pending nationwide that seek to hold the industry liable for local-level climate impacts.

The U.S. District Court for the District of Delaware is weighing whether to remand that state’s lawsuit to state court, which is considered less favorable for industry defendants.

Sher Edling LLP lawyer Victor Sher, representing Delaware, told Stark the Supreme Court’s ruling has no bearing on the argument for state court jurisdiction.

“The issue before the court and the only one that the opinion dealt with was a narrow one,” Sher said. He added that the Supreme Court correctly described the climate cases as “about promoting fossil fuels while allegedly concealing their environmental impacts.”

That framing, with a focus on alleged deception, is a central part of the debate between climate litigants and oil companies, and dominated Wednesday’s hearing.

Industry lawyers have a litany of arguments for placing the cases in federal court, including a claim that the lawsuits effectively aim to curtail oil and gas production or emissions. The Supreme Court’s ruling didn’t resolve whether such cases belong in state or federal court.

“Now the courts of appeals will have to wade through all of those issues,” Sher said, adding that “we’re dealing with delay, not disposition.” Sher represents several state and local governments in similar climate cases.

Stark pressed Sher on whether those revived proceedings in federal appellate courts make it “more likely as an empirical matter” that climate cases will be resolved in federal court. Sher said that’s still unlikely because the industry’s various arguments for federal jurisdiction are weak—as evidenced, he said, by the multiple district court decisions that have rejected all those claims.

Industry lawyer Theodore Boutrous Jr., of Gibson Dunn & Crutcher LLP, argued the notion that district courts are aligned on the question is “totally wrong.” Two district court judges have dismissed cities’ claims, and other cases are now poised for broader appellate proceedings in light of the Supreme Court’s decision, he said.

“We’re going to go back to those courts and lay those issues back before them,” Boutrous said.

Climate litigation is likely to reach the Supreme Court again if circuit courts split on the issue.

Industry lawyers flagged the Supreme Court’s ruling in several other pending climate cases this week, including lawsuits in South Carolina, Maryland, and Connecticut. They’re seeking delays in some cases to allow the U.S. Court of Appeals for the Fourth Circuit to resolve whether Baltimore’s case belongs in state or federal court.

The U.S. District Court for the District of Maryland on Wednesday granted an industry request to freeze proceedings in climate litigation filed by Annapolis, Md.

“The Fourth Circuit will surely provide guidance in the Baltimore Case that will aid resolution of the Remand Motion,” Judge Ellen Hollander wrote. “That is worth the wait.”

The Delaware case is Delaware v. BP America Inc., D. Del., oral arguments held 5/19/21.

(Adds details of Annapolis order in final paragraphs.)

To contact the reporter on this story: Ellen M. Gilmer in Washington at egilmer@bloomberglaw.com

To contact the editor responsible for this story: Seth Stern at sstern@bloomberglaw.com