Boulder is one of the Colorado communities suing to recover damage costs in a climate suit vs. oil companiesBoulder is one of three Colorado communities seeking to hold Exxon and Suncor responsible for climate impacts such as extreme weather, flooding and wildfires. Photo credit: Thomas Cooper/Getty Images

By Karen Savage

A federal judge has ruled that a climate liability suit against Exxon and Suncor by three Colorado municipalities belongs in state court, handing a defeat to the companies, which sought to have them heard in federal court.

The decision, issued by U.S. District Judge William J. Martinez on Thursday, is the latest setback for the fossil fuel industry, which has argued in all the liability cases filed against it across the country that federal courts should hear these cases under federal law. The industry believes it has a better chance of succeeding in federal courts because they have traditionally ruled in their favor in climate-related cases.

The city and county of Boulder and the county of San Miguel allege that Suncor and Exxon knew for decades that their products contributed to climate change, but deliberately downplayed the risk to policymakers and the public. In the suit, the communities asserted state law claims of public nuisance, private nuisance, trespass, unjust enrichment, violation of the Colorado Consumer Protection Act and civil conspiracy and are seeking to force the companies to help pay for the costs of climate change impacts.

“We’re quite pleased with the decision, which is the latest in what is now a pretty solid trend in the federal courts in favor of hearing these cases in the state courts,” said Marco Simons, an attorney representing the communities.

That victory streak includes federal judges recently ruling that Rhode Island’s and Baltimore’s cases fall under state jurisdiction. A set of suits in California, filed by the counties of Marin, San Mateo and Santa Cruz, along with the cities of Imperial Beach, Santa Cruz and Richmond, were also remanded to state court. The industry defendants have appealed all of those rulings.

Exxon and Suncor argued the Colorado suit belongs in federal court because it threatens to interfere with energy policy and other matters of national scope. They also said the suit involved relations with foreign countries.

Martinez disagreed, writing that the municipalities are suing for harms caused by the Exxon and Suncor’s sale of fossil fuels. He said  the companies have mischaracterized the municipalities’ claims. 

“This decision is significant because the court clearly saw through the oil companies attempts to mischaracterize what this case is about and to frankly mischaracterize their own past position,” said Simons, general counsel for EarthRights International, who represents the city and county of Boulder and the county of San Miguel. 

Simons said Exxon’s approach to jurisdictional issues is inconsistent, a discrepancy noted by Martinez in the ruling.

“In another case, ExxonMobil appeared to argue the opposite of what it argues here,” Martinez wrote in a footnote, referring to the Kivalina v. Exxon suit, which involved similar issues and  Exxon argued did belong in state court. 

The suit, which was ultimately dismissed in 2012, was filed filed by the Alaskan village of Kivalina against Exxon in federal court and involved nuisance claims grounded in federal common law. 

“[Exxon’s] strategy has basically been you can’t sue us anywhere, and that’s why this decision is about more than just which court hears the case,” Simons said. “Exxon has tried to weaponize these jurisdictional arguments against hearing the cases at all.”

Martinez rejected Exxon and Suncor’s argument that the Clean Air Act (CAA) requires the case be heard in federal court.

“The Clean Air Act  is silent on that issue; it does not remedy plaintiffs’ harms or address defendants’ conduct. And neither EPA action, nor a cause of action against EPA, could provide the compensation plaintiffs seek for the injuries suffered as a result of defendants’ actions,” Martinez wrote. 

Martinez said every court—including in the Baltimore, Rhode Island and California suits—has rejected that contention, writing that the CAA “provides no federal cause of action for damages, let alone one by a plaintiff claiming economic losses against a private defendant for tortious conduct.” 

Exxon did not immediately respond to a request for comment. Suncor said in a statement that it is reviewing the judge’s order and evaluating its next steps.

“Suncor believes that progress on climate requires parties working together to find solutions, and this lawsuit is polarizing and counterproductive. Climate change is a global issue that needs to be addressed collectively, and Suncor has long contributed to that effort,” a company spokesperson said. 

The communities, which are already experiencing climate impacts and face billions in mitigation costs, are preparing for trial. 

“We’re looking forward to moving forward in Colorado state court to hold Exxon and Suncor responsible for the costs their actions have imposed on these communities through their part in creating the climate crisis,” Simons said.

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