Big Oil Climate Change Suits Stay in Federal Court

SAN FRANCISCO (CN) – A federal judge on Tuesday sided with Big Oil’s request to keep two climate change suits in federal court, a move that could foreshadow doom for efforts to hold oil companies liable for rising sea levels.

U.S. District Judge William Alsup found the cities of Oakland and San Francisco cannot sue oil companies for public nuisance under state law because the alleged misconduct occurred on a global scale and therefore falls under the federal court’s jurisdiction.

“Plaintiffs’ claims for public nuisance, though pled as state-law claims, depend on a global complex of geophysical cause and effect involving all nations of the planet (and the oceans and atmosphere),” Alsup wrote in his 9-page ruling. “It necessarily involves the relationships between the United States and all other nations. It demands to be governed by as universal a rule of apportioning responsibility as is available.”

Oakland and San Francisco sued five major oil companies in state court last year, claiming they should cover the cost of sea walls and other projects needed to protect the cities from the consequences of climate change.

The twin lawsuits accuse BP, Chevron, ConocoPhillips, Exxon Mobil and Royal Dutch Shell of organizing massive disinformation campaigns to deceive the public about the dangers of fossil fuel production.

After the suits were removed to federal court, the cities asked Alsup to send them back to state court because only state law claims were alleged in the complaints.

Alsup denied that request Tuesday night, finding remanding the cases would give cities across the nation a green light to sue Big Oil in state courts with outcomes varying depending on each state’s public nuisance law.

“A patchwork of fifty different answers to the same fundamental global issue would be unworkable,” Alsup wrote.

The oil companies say they can’t be sued for problems caused by fossil fuel emissions because any such claims are preempted by the federal Clean Air Act, which regulates emissions. The cities counter that the Clean Air Act only preempts federal common law claims, not state law claims.

By concluding that the cities cannot sue oil companies for public nuisance under state law, Alsup undercut some of the cities’ key legal arguments.

But the cities also advanced a novel theory of liability that could enable them to sidestep the Clean Air Act preemption problem.

Oakland and San Francisco seek to hold the companies liable for public relations campaigns aimed at discrediting scientific research on global warming. The cities also want the companies held liable for selling fossil fuels, rather than emitting pollutants.

Despite those unique legal theories, Alsup found the need for a uniform resolution no less pressing.

“The transboundary problem of global warming raises exactly the sort of federal interests that necessitate a uniform solution,” Alsup wrote. “This is no less true because plaintiffs assert a novel theory of liability, nor is it less true because plaintiffs’ theory mirrors the sort of state-law claims that are traditionally applied to products made in other states and sold nationally.”

San Francisco City Attorney’s Office spokesman John Cote said the city was still evaluating the ruling and had not yet decided whether to appeal the decision.

“It’s clear that Judge Alsup issued a thoughtful ruling that sets out a clear path for us to proceed with our case in federal court,” Cote said in an email Wednesday afternoon. “No matter what courthouse we’re in, we will continue to defend San Francisco residents from fossil-fuel companies that are trying to shirk their responsibility and stick taxpayers with the bill.”

Chevron attorney Theodore Boutrous Jr., of Gibson Dunn & Crutcher in Los Angeles, said Alsup “got it exactly right” in concluding that federal court is the proper venue for this case.

Moving forward, Boutrous said the cities will face multiple legal obstacles, including Clean Air Act preemption, federal laws governing and encouraging U.S. oil and gas production to attain energy independence, and the foreign affairs doctrine.

“This complaint is seeking to regulate foreign activity in an area that involves sensitive foreign affairs, so there are all sorts of legal problems these claims would face,” Boutrous said.

When asked who should pay for sea walls and other projects to combat rising sea levels caused by climate change, Boutrous said the global community must solve these problems, not the courts.

“The tort lawsuits are counterproductive,” Boutrous proclaimed. “These are global issues that require global engagement on multiple fronts. That’s the way these issues have to be dealt with.”

Three other California municipalities – San Mateo County, Marin County, and the city of Imperial Beach – also sued Big Oil last year and had their lawsuits moved to federal court. Another federal judge in San Francisco, Vince Chhabria, has yet to issue a ruling on those cites and counties’ request to send their cases back to state court.



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