All posts tagged 'standing'

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)

The DC Circuit Locks in USEPA's GHG Regulations - Sort Of

June 26, 2012 20:13
by J. Wylie Donald
It took a little over five years but USEPA's greenhouse gas regulation program is now firmly established - for the moment anyway.  The D.C. Circuit today rejected every challenge by numerous petitioners and intervenors to the whole raft of USEPA rules that followed from the critical Supreme Court decision, Massachusetts v. EPA, in 2007.  In Coalition for Responsible Regulation, Inc. v. Environmental Protection Agency (attached), the D.C. Circuit considered arguments against the validity of The Endangerment Rule, Endangerment and Cause or Contribute Findings for Greenhouse Gases Under Section 202(s) of the Clean Air Act, 74 Fed. Reg. 66,496 (Dec. 15, 2009), The Tailpipe Rule, Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards, 75 Fed. Reg. 25,324 (May 7, 2010) The Tailoring Rule, Prevention of Significant Deterioration and Title V Greenhouse Gas Tailoring Rule, 75 Fed. Reg. 31, 514 (June 3, 2010), and The Timing Rule, Reconsideration of Interpretation of Regulations That Determine Pollutants Covered by Clean Air Act Permitting Programs, 75 Fed. Reg. 17,004 (Apr. 2, 2010),  as well as a general challenge to the USEPA's implementation of the Clean Air Act.  Each argument was rejected.  The Endangerment and Tailpipe Rules are not arbitrary and capricious, no petitioner (whether from industry or a state) had standing to attack the Timing and Tailoring Rules, and the USEPA's interpretation of the relevant Clean Air Act provisions "is unambiguously correct." The blogosphere is overwhelmed with commentary and analysis.  Rather than repeat what others have already said, we want to focus on just one small segment (pages 45-50) of the 82 page opinion:  standing for the National Association of Home Builders (NAHB) and the National Oilseed Processors Association (NOPA).  The court singled out the NAHB and the NOPA because they were the only industry petitioners that had standing to challenge the "result of the Tailpipe Rule, which had the effect of expanding the [Prevention of Significant Deterioration] PSD program to never-regulated sources."  A little background is in order.  Massachusetts v. EPA established that greenhouse gases could be regulated as air pollutants (within the meaning of the Clean Air Act) by USEPA.  The Endangerment Finding concluded that six "well-mixed" greenhouse gases emitted from motor vehicles contributed to the "climate change problem" and thus were "reasonably anticipated to endanger public health and welfare."  As a result, USEPA issued the Tailpipe Rule, which set GHG emission standards for cars and light trucks. Two sections of the Clean Air Act, the PSD program and the state permitting requirements under Title V, are triggered by the emission of "any air pollutant" (which USEPA has interpreted to mean: any regulated air pollutant).  Accordingly, once GHGs were regulated anywhere under the Clean Air Act (such as from tailpipes of motor vehicles), GHGs constituted an "air pollutant" within the meaning of the Act and stationary sources that emitted GHGs became subject to PSD and Title V permitting requirements.  The proverbial camel's nose was in the tent, and the camel followed post-haste. This approach to regulation was long-standing and had been relevant to rules promulgated in 1978, 1980 and 2002.  Since the Act provided for a basis for review only within 60 days of the promulgation of national regulations, challenges to USEPA's approach were very much time-barred, but with one very significant exception: "if such petition is based solely on grounds arising after such sixtieth day, ..." 42 U.S.C. 7607(b)(1). What this means is that an entity whose claim has recently ripened has standing to challenge the USEPA's approach.  Stated differently, entities that did not have standing in 1978, 1980 or 2002 because "their alleged injuries were only speculative" (such as NAHB and NOPA), may subsequently find they do have standing because their facilities are now regulated.  NOPA asserted that "[prior] to promulgation of the Tailpipe Rule, no member's facility had triggered PSD review by virtue of emissions of a non-criteria pollutant.  Now that greenhouse gases are a regulated non-criteria pollutant, many NOPA members will have to obtain PSD permits as [a] result of their facilities' emissions ..."  NAHB members who likewise were not subject to PSD requirements, were now certain to have to obtain PSD permits sometime in the future.  Accordingly, unlike other industry petitioners, NOPA and NAHB were found to have standing to challenge USEPA's "interpretation of the PSD permitting triggers ..."  This result is important.  Absent regulations like the Tailoring Rule, GHG regulation will be far-reaching and will bring in entities not previously subject to regulation.  Those entities will be entitled to challenge the regulation, as well as the methods USEPA uses to implement the regulations, even if those methods have been around for decades.  Thus, even though USEPA's GHG program sailed through this set of challenges, the door certainly is not closed to other challenges as GHG regulation expands.    20120626 Coalition for Responsible Regulation, Inc. v EPA (D.C. Cir.).pdf (188.21 kb)

Carbon Dioxide | Climate Change Litigation | Greenhouse Gases | Legislation

Dismissed Means Dismissed: Comer v. Murphy Oil, the First Climate Change Liability Damages Suit, Is Tossed Again

March 22, 2012 19:14
by J. Wylie Donald
In a case of surprising longevity, Comer v Murphy Oil USA, Inc., may finally have been laid to rest. In a decision filed Tuesday, Judge Louis Guirola, Jr., Chief Judge of the United States District Court for the Southern District of Mississippi, concluded that the plaintiffs in the first climate change liability damages suit were not entitled to a second bite at the apple. And even if they were, their case still failed. In the aftermath of Hurricane Katrina, numerous parties filed scores of lawsuits seeking to find some source to pay for the awful devastation. One suit, Comer, asserted through various amended complaints that electric utilities, coal companies, chemical companies and oil companies  were responsible for the increased ferocity of Hurricane Katrina because of their emissions of greenhouse gases and their alleged resultant contribution to global warming.   Following various iterations, plaintiffs ultimately alleged:  "Prior to striking the Mississippi Gulf Coast, Hurricane Katrina had developed into a cyclonic storm of unprecedented strength and destruction, fueled and intensified by the warm waters and warm environmental conditions present in the Atlantic Ocean, Caribbean Sea, and the Gulf of Mexico.  These high sea surface temperatures, which were a direct and proximate result of the defendants' green house gas emissions, increased the intensity and magnitude of Hurricane Katrina."   Amended Complaint, 1:11-cv-00220-LG-RHW, ¶ 17.  Plaintiffs also alleged risks of future harms as a result of effects of global warming. Motions to dismiss were filed, which ultimately led to judgment in favor of the defendants. Judge Guirola ruled that plaintiffs lacked standing and that the claims were non-justiciable under the political question doctrine.  2007 WL 6942285 (S.D. Miss. Aug. 30, 2007), Plaintiffs appealed and were initially successful before the Fifth Circuit, which reversed the district court and concluded:  "Like the district courts in [Connecticut v.] American Electric [Power Co., 406 F. Supp. 2d 265 (S.D.N.Y. 2005)] and [California v.] General Motors [, 2007 WL 2726871 (N.D. Cal. 2007)], the defendants begin with an assumption they cannot support, viz., that the adjudication of plaintiffs' claims will require the district court to fix and impose future emission standards upon defendants and all other emitters. Then, again in a fashion similar to those district courts, the defendants proclaim that it would be "impossible" for a court to perform such an obviously legislative or regulatory task so that the case must present a nonjusticiable political question. The defendants have failed to show how any of the issues inherent in the plaintiffs' nuisance, trespass, and negligence claims have been committed by the Constitution or federal laws "wholly and indivisibly" to a federal political branch."  Comer v. Murphy Oil USA, 585 F.3d 855, 879 (5th. Cir. 2009). That was the high water mark of the plaintiffs' bar's success in climate change liability cases. With the Second Circuit's decision in Connecticut v. American Electric Power Co., 582 F.3d 309 (2nd Cir. 2009), just one month earlier, the tide crested with the Fifth Circuit's decision in October.  Two federal courts of appeal had found standing for climate change liability plaintiffs, and rejected the political question doctrine.  Concurrently, however, a new climate change liability suit, Native Village of Kivalina v. ExxonMobil Corp., was dismissed at the end of September.  663 F. Supp. 2d 863 (N.D. Cal. 2009).  From the present perspective, Kivalina's dismissal marked the turning of the tide. The next dark moment for the plaintiffs occurred when the Fifth Circuit en banc accepted the appeal of Comer, automatically vacating the panel's decision. Then the en banc court's quorum dissolved, requiring the court to dismiss the appeal.  But with the panel decision already vacated, that meant the controlling law was Judge Guirola's 2007 dismissal. The Supreme Court refused to issue a mandamus order, which meant Comer was over.  It got darker.  The Supreme Court dismissed the plaintiffs' federal common law claims in American Electric Power; the gutted case was remanded to the Second Circuit (and plaintiffs ultimately dismissed voluntarily).  So as of June 2011 all the climate change liability suits had been disposed of. Well, not entirely.  Kivalina was pending on the Ninth Circuit's docket.  And the Comer plaintiffs refused to abandon the field and re-filed their claims, relying on a Mississippi statute purportedly permitting refiling. Judge Guirola, however, did not agree. Plaintiffs' claims were barred because the doctrines of res judicata and collateral estoppel applied. Slip op. at 12.   Plaintiffs had had a previous  opportunity to litigate their claims, which had been decided against them with prejudice.  Moreover, plaintiffs still lacked standing because they could not demonstrate that their alleged injuries were "fairly traceable" to the defendants' activities:  "As this Court stated in the first Comer lawsuit, the parties should not be permitted to engage in discovery that will likely cost millions of dollars, when the tenuous nature of the causation alleged is readily apparent at the pleadings stage of the litigation. The Court finds that the plaintiffs have not alleged injuries that are fairly traceable to the defendants’ conduct, and thus, the plaintiffs do not have standing to pursue this lawsuit."  Slip op. at 23.   In addition, the political question doctrine still applied:  " The Court finds that the claims presented by the plaintiffs constitute non-justiciable political questions, because there are nojudicially discoverable and manageable standards for resolving the issues presented, and because the case would require the Court to make initial policy determinations that have been entrusted to the EPA by Congress."  Slip op. at 29.   And just in case all that was not enough, Judge Guirola also ruled that 1) "the plaintiffs’ entire lawsuit is displaced by the Clean Air Act", slip op. at 30 (relying on American Electric Power); 2) the three-year statute of limitations applied to the Hurricane Katrina-based claims because the Mississippi "savings statute" did not apply, and the alleged continuing torts were not ripe, slip op. at 33; and 3) plaintiffs could not demonstrate proximate cause because "[t]he assertion that the defendants’ emissions combined over a period of decades or centuries with other natural and man-made gases to cause or strengthen a hurricane and damage personal property is precisely the type of remote, improbable, and extraordinary occurrence that is excluded from liability."  Slip op. at 35. Judge Guirola's decision is well-written and thorough.  Will it be enough? We expect so but we cannot be pollyana here.  A Fifth Circuit panel has wrestled with Judge Guirola's standing and political question analysis before, and reversed him.  This time, however, they will also need to avoid his res judicata, collateral estoppel, displacement, statute of limitations and proximate cause analyses.  That seems a tall order.  As for the the Second Circuit, its decision on standing is still valid law because that issue was not resolved by American Electric Power.  Indeed, the Supreme Court split 4-4 on the issue (Justice Sotomayor recused herself because of her participation in argument at the court of appeals).  Should Comer (or Kivalina) make it to the Court, the standing question could come out badly for the defense if Justice Sotomayor is the swing vote needed for a bare majority in favor of broader standing.  Last, we have Kivalina before the Ninth Circuit.  While undoubtedly the court will have read Judge Guirola's opinion, it will also have read the Fifth Circuit panel's decision.  Which will be more influential?  We'll make that decision then.

Carbon Dioxide | Climate Change Litigation

Gifford v. USGBC - Dismissed (But Not on the Merits)

August 18, 2011 19:55
by J. Wylie Donald
One of the more infuriating things about lawyers is that often, if they do their job right, their client wins and no one else benefits from it. This is what happened Monday before Judge Sand in the Southern District of New York in the closely followed green building case, Gifford v U.S.Green Building Council. The judge, in a short Memorandum & Order barely over seven pages (attached below) dismissed Mr. Gifford's case on procedural grounds. So we are left to wonder about the merits. Mr. Gifford and his co-plaintiffs are building engineering professionals. They assert that the USGBC's LEED standard is false and misleading and has injured them in their business. Specifically, "LEED-certified buildings are no more energy-efficient than non-LEED certified buildings.  USGBC's own study data on the subject indicate that, on average, LEED buildings use 41% more energy than non-LEED buildings.  There is no objective empirical support for the claim that LEED buildings consume less energy.  LEED buildings are less efficient because the criteria that USGBC purportedly uses to certify buildings do not correlate with energy efficiency."  First Amended Complaint ¶ 4 (attached below); also id. ¶ 32 (providing more detail).  As a result of the LEED claims made by USGBC, customers purchase LEED services rather than plaintiffs' design services. These injuries, according to plaintiffs, entitled plaintiffs to proceed in court for injunctive relief and damages under the federal Lanham Act for commercial misrepresentations and parallel state law claims. USGBC defended on the ground that the plaintiffs had no standing to assert Lanham Act injury. The court agreed.  Memorandum & Order at 7. There are two tests for standing in the Second Circuit. Under the first test, the parties must be competitors.  Id. at 4.  Plaintiffs did not certify green buildings or accredit professionals, as USGBC did. Accordingly, they failed the first test. The second test, the reasonable commercial interest test, was more forgiving. There "a plaintiff must demonstrate (1) a reasonable interest to be protected against the alleged false advertising, and (2) a reasonable basis for believing that the interest is likely to be damaged by the alleged false advertising." Id. (citation omitted). Where the parties are not direct competitors a plaintiff must make a "more substantial showing of injury and causation.".  Id. at 5 (citation omitted). Mr. Gifford and his co-plaintiffs could not satisfy that test either. The court found the allegation that plaintiffs' professional services would be "subsumed" by USGBC was "speculative".  It commented that  "there is no requirement that a builder hire LEED-accredited professionals at any level, let alone every level, to attain LEED certification, ..." Id. at 6.  (While technically correct, my LEED AP colleagues confirmed that as a practical matter they can't imagine a LEED project would proceed without a LEED AP on the project team.  At the very least, having a LEED AP on the team entitles one to points toward certification.) As to the specific allegation of misrepresentation regarding building efficiencies, there was no allegation that anyone relied on that statement to decline to hire Mr Gifford. So the plaintiffs lacked standing under the second test too.  Id. at 7. The absence of standing was fatal to the federal claims, which the court dismissed with prejudice.  Id.  As to the state law claims, it declined to assert supplemental jurisdiction and dismissed those claims as well (but without prejudice).  Id. at 8. The blogosphere reports that Mr Gifford is considering his appeal.   A press release by USGBC states: "This successful outcome is a testament to our process and to our commitment to do what is right."  What the rest of us want to know, however, is whether there was any substance to any of Mr. Gifford's allegations. This is important and not only for the decision of whether it is sensible to build a LEED-certified building. One has to think about plans that go awry.  Should a green building project fail and investors and lenders lose money (and it is a statistical certainty that this will happen), the injured parties will cast about looking for a place to lay the blame. Mr Gifford might assert that false hopes raised by USGBC's claims are at the root of the problem.    20110815 Memorandum & Order (of Dismissal) Gifford v. U.S. Green Building Council (72.00 bytes) Gifford v U.S. Green Building Council - First Amended Complaint February 7, 2011.PDF (94.75 kb)

Climate Change Litigation | Green Buildings | Sustainability

McCARTER & ENGLISH CLIMATE CHANGE AND RENEWABLE ENERGY PRACTICE GROUP

The business case for the development of renewable energy projects, from biodiesel and ethanol to wind, solar, and distributed generation, is more compelling than ever as tax and regulatory incentives combine to attract investments. Emerging issues in environmental law and increasingly recognized principles of corporate social responsibility are encouraging public companies to voluntarily reduce greenhouse gas emissions, install clean energy alternatives, and invest overseas in projects under the Kyoto Protocol to respond to climate change concerns.

Click here for more information and a list of our group members.

MONTH LIST

© 2017 McCarter & English, LLP. All Rights Reserved. disclaimer
navbottom image