By John Kruzel and Andrew Chung
WASHINGTON, Oct 5 (Reuters) – US Supreme Court justices wrestled with complex questions over whether to let local governments try to hold oil companies liable for the harms caused by climate change, as they opened their new nine-month term on Monday.
The justices heard arguments in an appeal filed by US-based ExxonMobil and Canada-based Suncor Energy after Colorado’s top court allowed a lawsuit by officials in Boulder, Colorado, accusing the companies of violating state law and seeking unspecified monetary damages.
The companies, backed by President Donald Trump’s administration, argue that the federal government’s authority to regulate air pollution precludes Boulder’s claims.
Questions posed by the justices reflected a mix of concerns, including about unduly limiting the authority of states to pursue climate-related litigation, as well as the potential to unleash chaos if local governments across the country were permitted to sue these companies.
DOZENS OF LAWSUITS
Nearly 60 state and local governments have brought dozens of similar suits seeking billions of dollars in damages from fossil fuel companies, with more continuing to be filed, according to Exxon and Suncor. A ruling by the Supreme Court siding with the companies could lead to many of those cases being dismissed.
The Boulder case marked the latest example of the energy sector asking the justices to block climate-related liability or limit federal environmental regulation.
Conservative Chief Justice John Roberts was one of several justices whose questions suggested misgivings about aspects of each side’s position.
Roberts pressed Kannon Shanmugam, a lawyer for the oil companies, and Sarah Harris, a Justice Department lawyer representing the Trump administration, on why state lawsuits are barred when such litigation has been allowed in similar contexts.
“There are a lot of familiar situations where conduct outside of a state has broad effects among other states and all that — and yet we allow state courts in a particular state to bring litigation that affects that,” Roberts told Harris. “I guess I’m not quite sure what makes this situation different from those, all those other ones, where we’ve allowed them to proceed in state court.”
Roberts later pressed Kevin Russell, a lawyer for the Boulder officials, on the practical implications of siding with his position.
“Presumably, if you prevail, the next day a municipality in every single state will file a lawsuit, they’ll probably copy your pleadings, and then there will be at least 50 … causes of action filed,” Roberts said. “How do you think that would work out on the ground?”
Some of the justices highlighted uncertainties about which legal standards should apply in the case, and whether it should be returned to the lower court for further proceedings.
Given the sharp questions posed by the justices to both sides, it appeared possible that the Supreme Court could divide 4-4, leaving the lower court’s judgment intact.
The court has a 6-3 conservative majority. But conservative Justice Samuel Alito has recused himself from participating in this case, meaning the ruling will be made by eight justices and not nine. Alito owns stock in several oil and gas companies but not Exxon or Suncor, according to his financial disclosure forms.
Boulder’s city and county governments have accused Exxon and Suncor of helping drive climate change and misleading the public about the risks of fossil fuels. Boulder aims to hold them liable for past and future costs — such as infrastructure repairs, emergency management and harms to public health — associated with the effects of climate change such as wildfires, droughts and floods.
The top US judicial body opened its new term on the first Monday in October, as is its custom. It also has major cases involving Trump’s hardline immigration policies and state-level bans on assault-style rifles, among others, lined up for later in the term.
WINNING RECORD
Energy companies and trade groups, along with states allied with them, have built a largely winning record at the Supreme Court over the past two decades in cases involving climate liability and the reach of federal environmental regulation.
Backers of the oil companies argue that if Boulder’s most far-reaching claims are allowed to proceed, it could give states sweeping power over conduct occurring far outside their borders.
The burning of fossil fuels releases greenhouse gases including carbon dioxide into the atmosphere, trapping heat and raising average global temperatures over time.
Liberal Justice Sonia Sotomayor pushed back on Shanmugam’s contention that Congress foreclosed state lawsuits by passing the Clean Air Act, saying the court has permitted such actions under state law in the Clean Water Act, another landmark federal environmental law.
“I don’t see why we wouldn’t permit it under the Clean Air Act either,” Sotomayor said.
Conservative Justice Brett Kavanaugh, who seemed to favor the arguments of the oil companies, said the court’s prior rulings make “crystal clear that interstate air and water pollution are matters for federal law unless Congress specifically preserves state law.” Kavanaugh pressed Russell to address “a wall of precedent” that could undermine Boulder’s stance.
Liberal Ketanji Brown Jackson said some of the questions asked by her colleagues during the arguments “make me think that we’re really early in this case” and “that this is sort of premature from the standpoint of this court exercising its jurisdiction.”
Shanmugam replied that the federal issues involved in the case have been “fully decided” by the Colorado Supreme Court and other lower courts, too.
“I would submit,” Shanmugam added, “that given the extraordinary magnitude of these cases, where in each of these cases plaintiffs are seeking billions of dollars of damages, that we need an answer to this question sooner rather than later.”
The Supreme Court’s decision is expected by the end of June.
(Reporting by John Kruzel; Editing by Will Dunham)
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