San Francisco and Oakland were seeking abatement funds to deal with the impacts of climate change.

By Dana Drugmand

A federal judge’s decision Monday to dismiss the climate liability lawsuits brought by San Francisco and Oakland against five of the world’s largest oil companies raised as many questions as it answered. U.S. District Judge William Alsup’s ruling at once made a sweeping declaration that the courts are not the appropriate venue in which to tackle climate change, while largely ignoring the central issue of the complaint: should the companies that produce the product that drives global warming pay the costs?

Alsup’s dismissal upheld the fossil fuel defendants’ argument that courts should not decide complex policy questions surrounding climate change. “The problem deserves a solution on a more vast scale than can be supplied by a district judge or jury in a public nuisance case,” Alsup wrote in his order.

But the cities were pursuing something much less vast: an abatement fund they could use to protect their citizens and infrastructure from rising seas, extreme weather and other costly impacts of climate change.

“He created a policy issue that wasn’t there,” said Ken Adams, a Washington-based attorney at Adams Holcomb LLP. “I’m disappointed he didn’t just decide the case before him.”

Alsup’s ruling will be widely debated for its impact not just on this case—which will likely be appealed by the cities to the Ninth Circuit Court of Appeals—but on the 11 other suits being pursued around the country.

While most experts say the decision will not influence the majority of those cases that are being heard in state courts, Alsup’s reasoning left open a lot of legal questions.

Fundamental Legal Issues

Alsup frustrated the plaintiffs as well as climate activists by agreeing with the oil companies’ argument that the court must balance the benefits to society of burning fossil fuels against the harms of climate change. According to many experts, that ignores the whole basis of the public nuisance claim: that the companies knew their product was dangerous and sold it anyway.

“The companies are liable by virtue of their significant contributions [to emissions] and particularly because of their behavior, their conduct,” said Patrick Parenteau, law professor at Vermont Law School who has been closely following these suits. “That’s what public nuisance law says—if you know you’re creating a danger, and you take steps to prevent others, including the government, from addressing the danger, then you’re liable.

“It’s a combination of significance of the amount of pollution you’re putting into the atmosphere, and the fact that you’re not only not changing your own behavior…but you’re affirmatively trying to prevent the government from addressing these problems. It’s that combination of things that makes you liable.”

According to Parenteau, Alsup erred in confusing liability and responsibility. “He says we’re all liable. No. That’s not true. We’re all responsible, but we’re not all liable.”

Marco Simons, general counsel at Earthrights International, pointed out what he said was another error in Alsup’s reasoning.

“This decision comes at a stage of the case where no evidence has been submitted; only the allegations of the complaint are at issue. Yet Judge Alsup determined that ‘judgments in favor of the plaintiffs . . . would make the continuation of defendants’ fossil fuel production ‘not feasible.’ Therefore, he reasoned, only Congress can decide whether to take that step; courts should not,” Simons wrote in a blog post.

“First, courts are supposed to decide based on facts. Would paying for the harms of their products really put the oil companies out of business? The companies certainly haven’t argued that, let alone submitted evidence of this,”Simons said. “Second, even if there were a possibility of putting the oil industry out of business, the question of balancing the harm caused by an industry against its ‘social utility’ is typically left to a jury to decide…Judge Alsup took that decision away from a potential jury, before any evidence had even been submitted.”

Jurisdictional Questions

Alsup’s ruling highlighted the reason why almost all of the climate liability suits were filed originally in state court. The cities seeking relief know that past federal rulings generally deferred the issue of climate impacts to the other branches of government, because carbon emissions fall under the purview of the Environmental Protection Agency as authorized by the federal Clean Air Act.

After San Francisco and Oakland filed in California court last year, the oil companies petitioned to move them to federal court. In February,  Alsup decided the case should stay in federal court. Alsup said then that federal common law must govern the nuisance claim, despite those previous court decisions (AEP v. Connecticut and Kivalina v. ExxonMobil) to the contrary.

A different district court judge came to the opposite conclusion in ordering that a similar set of California climate lawsuits be sent back to state court. Judge Vince Chhabria reasoned that climate change tort claims should be pursued under state, not federal, common law. The oil companies are appealing Chhabria’s order. San Francisco and Oakland had decided not to appeal Alsup’s decision.

UCLA law professor Ann Carlson, co-director of the Emmett Institute on Climate Change and the Environment, said Alsup’s decision on venue paved the way for him to grant dismissal.

Parenteau said that decision complicates the cities’ avenue for appeal. “The cities are in a bind now because they lived with the earlier decision that federal [common law] hadn’t been displaced. So now I don’t think they can go right to state court and re-file their argument,” he said. “They’re going to have to get [Alsup’s] decision overturned.”

But not everyone believes that issue is closed. “I also expect the Ninth Circuit will be asked to review Judge Alsup’s decision that federal common law necessarily governs the case, and that state common law is foreclosed,” said Michael Burger, executive director of the Sabin Center for Climate Change Law at Columbia University. “The appellate court’s decision on that issue — if it is raised — will have consequences for the other cases currently pending in California.”

Impact on Other Climate Liability Lawsuits?

The other cities and counties filing claims to hold fossil fuel companies accountable for climate change have, of course, been watching this case closely. There are almost a dozen similar lawsuits currently at varying stages, including two other sets of suits in California.

According to Carlson, Alsup’s opinion shouldn’t have any bearing on those because they remain in state court, and “state law is much more favorable for the plaintiffs than federal law is.”

San Mateo and Marin counties and the city of Imperial Beach have filed one set of cases, as have the city and county of Santa Cruz and the city of Richmond. Vic Sher, an attorney representing those cities and counties, said he remains optimistic despite Alsup’s dismissal.

“Judge Alsup’s ruling is disappointing but not unexpected,” he said. “But it has virtually no bearing on the lawsuits brought by our six clients, which are moving forward under a variety of state common law claims, focusing on the marketing, production, distribution, and sale of products that these companies knew would cause the exact kinds of climate change-related consequences the communities are facing today.”

Outside of California, liability lawsuits are pending in King County, Wash.; Boulder, Colo., and New York City.

The New York City case was filed in federal court, meaning it could be directly impacted by Alsup’s ruling. But the federal judge hearing that case, John Keenan, isn’t bound by Alsup’s reasoning and New York officials say they are undeterred.

“The City is confident in its claims and we look forward to a decision from the judge in our case,” said a New York City Law Department spokesman.

Keenan held a hearing on the oil companies’ motion to dismiss earlier this month, and his decision is expected in the coming months.

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