Welcome
Environment & Energy Report

Supreme Court’s Climate Case Focuses on Procedure, Not Policy

Oct. 5, 2020, 10:00 AM

The U.S. Supreme Court last week added an important climate change case to its docket, giving oil and gas companies another shot at ducking high-stakes liability claims from state and local governments.

The justices agreed to review a petition from BP Plc, Chevron Corp., Exxon Mobil Corp., and other oil majors that say a climate-focused lawsuit from the city of Baltimore belongs in federal, not state, court.

Many legal scholars were surprised by the high court’s interest in the case, given the highly technical nature of the question before it: the scope of appellate review in certain skirmishes over state-versus-federal jurisdiction.

Here’s what to know about the Supreme Court’s new case.

What’s the Underlying Case About?

Baltimore sued big oil companies in 2018, saying they should cover the costs of local climate impacts, including flooding and heat waves. The industry produces and promotes fossil fuels while downplaying their role as the primary driver of global temperature increases, the city says.

Baltimore’s claims, filed in state court under state common law, mirror allegations against the industry in lawsuits from state and local governments in California, Colorado, Rhode Island, and elsewhere.

The cases are part of a nationwide campaign to hold the industry financially accountable for the impacts of climate change. The lawsuits are moving slowly, bogged down by complex debates over whether they belong in state or federal court.

Why Does It Matter Where Cases Are Heard?

Federal courts are considered a safer venue for industry defendants, especially for these climate cases.

“They are far less likely, as a whole and with some exceptions, to be willing to entertain expansive theories of liability than state courts,” George Mason University law professor Donald Kochan said.

Federal judges elsewhere had allowed multiple climate liability cases to proceed in state courts, but the high court’s decision to get involved gives the industry a fresh shot at arguing for federal jurisdiction.

A Chevron spokesman said the company is “hopeful the Supreme Court will agree that these issues require a closer look.”

Will the Supreme Court Address Climate Change?

Not directly.

The underlying climate liability claims are broad, but “the question the Supreme Court took is just this very narrow slice of it,” said Sean Hecht, a law professor at the University of California, Los Angeles, who has consulted for some plaintiffs in climate cases.

The issue centers on federal officer jurisdiction, or the notion that cases involving U.S. officials belong in federal court.

The technical question is this: What should appellate judges review when a defendant invokes such jurisdiction to bump a case to federal court—and a federal district judge rejects the arguments, and remands the case to state court?

Defendants generally can’t appeal remand orders, but Congress made an exception for decisions on federal officer jurisdiction. Circuit courts disagree on whether that means they should limit their review to the federal officer issue in such cases—or broaden it to look at entire remand orders.

What Impacts Could There Be?

A ruling against Baltimore would give the oil and gas industry another chance to steer the city’s case toward federal court, and it would reopen jurisdictional questions in climate cases from local governments in California and Colorado.

“We’re talking potentially a couple years’ more delay from that because it’s an entirely new round of proceedings in the court of appeals,” UCLA’s Hecht said.

The Supreme Court is expected to issue an opinion focused on the appellate review question, but it may also send a “strong signal” to lower court judges that the cases belong in federal court, said Karen Sokol, a law professor at Loyola University in New Orleans.

While some state-court proceedings are already on hold pending the outcome in an unrelated set of cases, industry lawyers could push to halt other climate cases against Big Oil until the justices resolve the Baltimore dispute.

The case is BP Plc v. Mayor & City Council of Baltimore, U.S., No. 19-1189.

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

To contact the editors responsible for this story: Anna Yukhananov at ayukhananov@bloombergindustry.com; Rebecca Baker at rbaker@bloombergindustry.com

To read more articles log in. To learn more about a subscription click here.