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Federal Judge Dismisses California Cities' Climate Lawsuit

U.S. District Court Judge William Alsup this week dismissed the climate change lawsuit brought by Oakland and San Francisco against British Petroleum, Chevron, ConocoPhilips, ExxonMobil, and Royal Dutch Shell—the world’s five largest investor-owned oil companies.

Plaintiffs argued that by selling petroleum products, the five companies contributed significantly to global warming, and therefore owe the cities billions of dollars in compensation for future damages from warming-induced sea-level rise.

Judge Alsup dismissed the suit on several grounds. One problem involves “timing.” No one knows at this point how much coastal property damage will occur, or how much of the expense the cities of Oakland and San Francisco will incur since federal assistance might cover much of it. “Requiring [the oil companies] to pay now into an anticipatory ‘abatement fund’ would be like walking to the pay window before the race is over,” the Judge muses.

Another problem is plaintiffs’ theory of culpability and blame. Nuisance law requires that the “gravity of the harm” be weighed against the “utility of the conduct.” Plaintiffs neglect the positive side of the ledger. Alsup explains:

With respect to balancing the social utility against the gravity of the anticipated harm, it is true that carbon dioxide released from fossil fuels has caused (and will continue to cause) global warming. But against that negative, we must weigh this positive: our industrial revolution and the development of our modern world has literally been fueled by oil and coal. Without those fuels, virtually all of our monumental progress would have been impossible. All of us have benefited. Having reaped the benefit of that historic progress, would it really be fair to now ignore our own responsibility in the use of fossil fuels and place the blame for global warming on those who supplied what we demanded? Is it really fair, in light of those benefits, to say that the sale of fossil fuels was unreasonable?

Citing American Electric Power v. Connecticut (2011) and Krivalina v. Exxon (2012), Alsup notes that the Clean Air Act “displaces” federal common law nuisance claims regarding greenhouse gas emissions in general and oil company emissions in particular. “Here, by contrast, defendants stand accused, not for their own emissions of greenhouse gases, but for their sale of fossil fuels to those who eventually burn the fuel." Implication: “If an oil producer cannot be sued under the federal common law for their own emissions, a fortiori they cannot be sued for someone else’s.”

Most importantly, plaintiffs’ lawsuit interferes with the separation of powers. Questions of “how to appropriately balance these worldwide negatives [of climate change] against the worldwide positives of the energy itself, and of how to allocate the pluses and minuses among the nations of the world, demand the expertise of our environmental agencies, our diplomats, our Executive, and at least the Senate,” Alsup writes.

In effect, plaintiffs attempt to dictate the foreign policy of the United States: “These claims—claims through which plaintiffs request billions of dollars to abate the localized effects of an inherently global phenomenon—undoubtedly implicate the interests of countless governments, both foreign and domestic.” The oil companies’ products are lawful in every nation, and many foreign governments actively support their activities. “Nevertheless, plaintiffs would have a single judge or jury in California impose an abatement fund as a result of such overseas behavior. Because this relief would effectively allow plaintiffs to govern conduct and control energy policy on foreign soil, we must exercise great caution.”

Plaintiffs deny their suit would interfere with the political branches. According to them, the court would not need to weigh the social utility of oil production, it would only have to assess the reasonableness of the damage awards they are seeking. Nice try but ruling in favor of Oakland and San Francisco would set a precedent inciting untold numbers of other cities to press similar claims for billion-dollar payoffs. That could render “continuing production” by the five defendants—and many other energy companies as well—“not feasible.”

Alsup agrees with plaintiffs that the dangers raised in their complaints are real. “But,” he concludes, “those dangers are worldwide. Their causes are worldwide. The benefits of fossil fuels are worldwide. 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. . . . The Court will stay its hand in favor of solutions by the legislative and executive branches.”