All posts tagged 'Ninth Circuit'

The Third Climate Change Liability Suit Fights to Stay Alive: Plaintiffs in Kivalina v. ExxonMobil Seek Rehearing

October 7, 2012 14:21
by J. Wylie Donald
The plaintiffs in the climate change liability suit, Native Village of Kivalina v. ExxonMobil, won’t go quietly.  Last Thursday, Plaintiffs filed with the Ninth Circuit Court of Appeals a petition for rehearing en banc (Petition attached), seeking to reverse the appellate panel’s decision (“Panel Decision”) that the doctrine of displacement barred the plaintiffs’ claims for nuisance damages under federal common law.  In their petition the plaintiffs focus on the panel's conclusion, based on Connecticut v. American Electric Power, that the Clean Air Act displaced all federal common law claims relating to greenhouse gas emissions, regardless of the remedy sought.  But they also weakly address the concurrence's separate reasoning finding that the plaintiffs did not have standing, and the district court's original conclusion that the political question doctrine bars the claim. For those unfamiliar with the Kivalina case, it is one of the triumvirate of cases (with Connecticut v. American Electric Power and Comer v. Murphy Oil USA) that are shaping the climate change liability legal landscape.  The plaintiffs in Kivalina assert that the defendants (electric utilities, oil companies and a coal company) are responsible for the emission of greenhouse gases that have caused the late freezing and early melting of arctic sea ice, which in turn permits arctic storms to erode the plaintiffs’ village that now lacks the sea ice’s protection.  The plaintiffs seek damages in the hundreds of millions of dollars.  The case was filed in the Northern District of California in 2007 and was dismissed in 2009; the dismissal was affirmed two weeks ago. And for those unfamiliar with en banc substance and procedure in the Ninth Circuit, it is unique.  Notwithstanding its name, an en banc hearing in the Ninth Circuit is not heard by the full court.  Instead, if 15 jurists (out of 29) vote to hear the case, ten judges are selected by lot to join the Chief Judge for the hearing.  See Fed. R. App. P. 35; Gen. Orders 9th Cir. §§ 5.1 et seq.).  If one does the math, it becomes apparent that even if a majority of the court concludes a case should come out a certain way, if six judges of an opposite mind are on the en banc panel, the law in the Ninth Circuit can vary from what the majority of the Ninth Circuit thinks the law should be. We now turn to the plaintiffs’ arguments: DISPLACEMENTPlaintiffs succinctly summarized their motion: "This case squarely presents the issue of whether a statute [e.g., the Clean Air Act] that displaces a federal common law cause of action for injunctive relief also displaces a federal common law damages action. Exxon Shipping [v. Baker, 554 U.S. 471 (2008)] answers this question in the negative and directly conflicts with the panel decision." Petition at 6.  The majority and the concurrence had ruled that, notwithstanding Exxon Shipping, Middlesex County Sewerage Authority v. National Sea Clammers Ass’n, 453 U.S. 1 (1981), provided that the remedy sought had no bearing on whether a claim was displaced.  To quote:  “where a federal common law nuisance claim for injunctive relief is displaced, a federal common law nuisance claim for damages claim likewise is displaced.” Panel Decision at 11663 (citing Middlesex County). Judge Pro noted in his concurrence a tension between Exxon Shipping and Middlesex County .  He wrote that Exxon Shipping suggests  “severing rights and remedies is appropriate as between damages and injunctive relief in some circumstances.” Panel Decision at 11665.  Plaintiffs contend that here are the right circumstances:  "in Exxon Shipping, the Supreme Court unambiguously held that a federal common law damages claim is not displaced by the Clean Water Act (“CWA”) – a federal environmental statute that, like the CAA, provides only injunctive relief and civil penalties – even though the CWA does displace a federal common law claim for injunctive relief." Petition at 1.  Their reasoning basically is that injunctive relief seeks the same result as a regulatory regime, and is therefore displaced.  “[T]he common thread running throughout the displacement cases is that the federal common law cannot create a parallel track with a regulatory regime established by Congress. Thus, in AEP the displacement holding, …, was expressly limited to injunctive relief claims seeking abatement of the nuisance. ‘We hold that the Clean Air Act and the EPA actions it authorizes displace any federal common law right to seek abatement of carbon-dioxide emissions from fossil-fuel fired power plants.’ Petition at 13 (citing AEP, 131 S. Ct. at 2537).  A claim for damages, on the other hand according to plaintiffs, has nothing to do with enforcement of standards.  “Kivalina does not seek to set emissions caps. It seeks damages.”  Id. at 13.  Judge Pro would disagree:  “By supplying a federal remedy Congress chose not to provide, this Court would not be “filling a gap,” it would be “providing a different regulatory scheme” than the one chosen by Congress. Panel Decision at 11671 (citation omitted). STANDINGPlaintiffs wrote:  “Judge Pro would have affirmed the dismissal for lack of standing.”  Petition at 17.  That is true, but he said it a little more forcefully:  ““[i]t is quite another [thing] to hold that a private party has standing to pick and choose amongst all the greenhouse gas emitters throughout history to hold liable for millions of dollars in damages.”  Panel Decision at 11676. Plaintiffs hardly address this point:  “Kivalina seeks damages, so redressability is easily satisfied.”  Id. at 18.  Don’t look for more analysis; there isn’t any.  Instead, there is a little sleight-of-hand.  Standing was granted to the plaintiffs in Massachusetts v. EPA to sue the federal government to enforce the Clean Air Act concerning carbon dioxide emissions.  Such standing is more difficult to achieve than standing in a simple suit for damages.  Hence, plaintiffs’ argument goes, if the plaintiffs had standing in Massachusetts, then it must be the case that plaintiffs in Kivalina have standing too.  Further, the “special assistance” provided by being a sovereign (as the Commonwealth of Massachusetts and other plaintiffs were) is not needed.  Plaintiffs are comparing apples and oranges.  A sovereign may have standing to sue another sovereign to enforce a law.  That simply has nothing to do with standing by a private party to sue another private party for damages.  POLITICAL QUESTIONThe trial court dismissed the Kivalina case on standing and also as a political question.  Plaintiffs contend that the “Supreme Court rejected the political question argument in AEP.”  We suppose that is technically correct.  A divided court affirmed 4-4 the Second Circuit’s decision rejecting application of the political question doctrine.  See AEP, 131 S. Ct. at 2535 & n.6.  But that hardly seems sufficient to convince the en banc court to permit rehearing. Likewise plaintiffs’ second argument, that a claim for damages lowers the bar for application of the political question doctrine, is barely made (five lines). Plaintiffs must be hoping that the en banc court will take up the Exxon Shipping – Middlesex County tension.  Their other arguments are insubstantial.  Regardless, it seems plain that the case is headed to a petition for certiorari to the Supreme Court.  Plaintiffs have identified a potential conflict in Supreme Court precedent.  If they lose, either because rehearing is not granted, or because rehearing is granted and the panel’s decision upheld, they have come too far to let the case go.  And if they win, defendants undoubtedly will seek a reversal by the Supreme Court, content ultimately to take their chances in state court, as we have previously suggested.     20121004 Petition for Rehearing, Kivalina v. ExxonMobil.pdf (76.64 kb)

Oral Argument in Kivalina: Winds of Change or Climate Change Liability Suits Becalmed?

December 4, 2011 20:16
by J. Wylie Donald
On November 8-9, 2011 an Arctic gale bore down on the peninsulas, islands, salt marshes and beaches of the Alaska littoral.  Named the Bering Sea Superstorm it pounded Alaska with 8-10 foot storm surges, wind gusts up to 75 mph and blizzard conditions.  One small community was particularly fearful.  Many readers already know of whom we are speaking:  Kivalina.  The National Weather Service wrote:  "WIDESPREAD MAJOR COASTAL FLOODING AND SEVERE BEACH EROSION IS EXPECTED IN THE FOLLOWING AREAS: ... 4. THE CHUKCHI SEA COAST FROM CAPE KRUSENSTERN TO POINT HOPE. THIS INCLUDES THE VILLAGES OF NOME AND KIVALINA WHERE MAJOR DAMAGE FROM COASTAL FLOODING AND STRONG WINDS IS EXPECTED.  Fortunately, the seawall at Kivalina held. While unusual, this was one storm of thousands that have visited high winds and storm surge upon Alaska's shoreline over the millennia.  Last Monday a storm of a different sort broke. Although not even rated on the Saffir-Simpson scale, the verbal gusts exhaled before the Ninth Circuit Court of Appeals in Native Village of Kivalina v ExxonMobil Corp. may have substantially more effect than any Arctic storm.  Or they may not. (Click here for the video or audio link or oral argument.) Kudos must be extended to Matt Pawa (Appellant Kivalina) and Daniel Collins (Defendants/Appellees) for masterful argument.  Both were completely on top of their game, whether it was jousting with the Court or each other over the Restatement (Second) (and sometimes Third), laying out their key arguments or responding to pointed questions from Judges Thomas, Clifton or Pro (on temporary assignment from the District of Nevada). (For those to whom Kivalina is not familiar, in a nutshell, a native Alaskan village on the shores of the Chukchi Sea has brought suit against electric utilities, oil companies and one coal company.  The complaint asserts the defendants are responsible for excess emissions of greenhouse gases, which have led to global warming, which has resulted in delayed formation of arctic sea ice and early melting as well, which has accelerated the erosion caused by winter storms.  The plaintiffs seek damages for the cost of relocating their village.  The suit was dismissed on political question grounds by the District Court for the Northern  District of California; it is now on appeal to the Ninth Circuit.) Mr. Pawa opened his argument with the proposition that it is black letter law that no balancing of interests is needed where an intentionally caused nuisance is causing a claimant serious harm.  He cited numerous Restatement sections in support.  The Court seemed skeptical.  Judge Clifton asserted in his question that balancing was called for in the Restatement.  Judge Pro wanted to know what instructions Mr. Pawa would give to the jury.  Judge Clifton queried:  "Why is it so difficult to find a case that remotely resembles this one?"  Mr. Pawa pointed to People v. Gold Run Ditch & Mining Co., 66 Cal. 138, 4 P. 1152 (1884), which established, he said, that valid nuisance claims lie against all polluters of a common resource.  (We, of course, take strong exception to any referral to carbon dioxide as pollution in light of its ubiquity, natural presence, and lack of toxicity in the atmosphere.  The parallels to water vapor - the most prevalent greenhouse gas and in no one's estimation a pollutant - are striking.) Although  there was not enough time in argument to fully develop Gold Run Ditch, it is worth a moment to consider.  There the California Supreme Court was asked to enjoin hydraulic mining which was despoiling California's rivers and threatening agricultural interests.  In holding that an injunction against the hydraulic mining operator should issue, the Court wrote: But a legitimate private business, founded upon a local custom, may grow into a force to threaten the safety of the people, and destruction to public and private rights; and when it develops into that condition, the custom upon which it is founded becomes unreasonable, because dangerous to public and private rights, and cannot be invoked to justify the continuance of the business in an unlawful manner. Every business has its laws, and these require of those who are engaged in it to so conduct it as that it shall not violate the rights that belong to others. Accompanying the ownership of every species of property is a corresponding duty to so use it as that it shall not abuse the rights of other recognized owners ... Upon that underlying principle, neither State nor Federal legislatures could, by silent acquiescence, or by attempted legislation ... divest the people of the State of their rights in the navigable waters of the State for the use of a private business, however extensive or long continued .... As we have already said, the rights of the people in the navigable rivers of the State are paramount and controlling.  66 Cal. at 152. The effect of Gold Run Ditch and a parallel decision in federal court, Woodruff v. North Bloomfield Mining Co., 18 F. 753 (1884), effectively ended hydraulic mining in California.  Whether a similar ruling could be used against entities emitting carbon dioxide into the atmosphere remains to be seen. Another interesting argument broached by Mr. Pawa concerned what he referred to as trivial emitters.  Judge Thomas played into his hand with a question about whether his driving to work made him a defendant.   According to Mr. Pawa Section 36 of the Restatement  (Third) takes care of that issue and negates liability to trivial emitters.  That section provides:  "When an actor’s negligent conduct constitutes only a trivial contribution to a causal set that is a factual cause of physical harm under § 27, the harm is not within the scope of the actor’s liability."  Mr. Pawa would permit the defendants to demonstrate that they constitute trivial contributors to the global warming problem. In closing, Mr. Pawa cited the substantial precedent in his clients' favor.  The Second Circuit reversed the trial court and found standing for the plaintiffs in Connecticut v. AEP, 582 F.3d 309 (2d Cir. 2009), which was not reversed by the Supreme Court.  Likewise the appellate panel in Comer v. Murphy Oil USA, 585 F.3d 855 (5th Cir. 2009), also reversed the trial court and found standing for the climate change liability plaintiffs.  (Mr. Pawa acknowledged that the decision had been vacated and cited the decision for the panel's thinking, not as precedent.)  Last, in Massachusetts v. EPA, 127 S.Ct. 1438 (2007), the Supreme Court also found standing for an entity alleging damage from greenhouse gas emissions. Mr. Collins responded to Mr. Pawa's arguments and knocked down plaintiffs' claim that black letter law established that balancing was not required.  Mr. Collins pointed to comment e of section 821B of the Restatement (Second) which requires an assessment of reasonableness whether the allegation is an intentional, reckless or negligent nuisance.  Further, the balancing required by plaintiffs' claims is "utterly without precedent."  "But balancing is what courts do all the time," interjected Judge Pro.  "Nothing on this scale has ever been remitted to a court," rejoined Mr. Collins.  This is not a case about a discreet pollution site; it is a case of global dimensions and there is no traceability of the emitted carbon dioxide (as the plaintiffs conceded). The Court was not so easily put off and brought up AEP, where the Second Circuit had permitted plaintiffs to proceed with their greenhouse gas liability claim, and the Supreme Court had not reversed.  Mr. Collins had seen that softball coming:  AEP is different because some of the plaintiffs were sovereigns, which was not the case here. Mr. Collins closed with strong points on his clients' primary position:  displacement of the federal common law applies to both injunctive and damages remedies.  This was established in Middlesex County Sewerage Auth. v. Sea Clammers, 453 U.S. 1, 13 (1981).  The reason is simple.  When Congress crafted the regulatory framework establishing the Clean Air Act, which displaced injunctive remedies, see American Electric Power v. Connecticut, Congress did not provide for any compensatory relief to an aggrieved private party.  Accordingly, a damages remedy is also displaced and the plaintiffs' claim is barred.  As the Ninth Circuit had itself held in In re Exxon Valdez, 270 F.3d. 1215 (9th Cir. 2001):  "a nuisance theory would enable a federal district judge to substitute a different balancing of interests from the one made by the agency to which Congress assigned the job".  In our view the Court's decision is not likely to be the final curtain.  If it goes in favor of the plaintiffs, the defendants will certainly appeal.  And if the defendants prevail, the state law claims (dismissed by the federal district court without prejudice) are likely to be refilled, particularly with the invitation set forth in by the Supreme Court in AEP:  "None of the parties have briefed preemption or otherwise addressed the availability of a claim under state nuisance law. We therefore leave the matter open for consideration on remand."

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