Climate Change

Flooding from Irene: Whither the Flood Plain?

August 30, 2011 20:50
by J. Wylie Donald
My train this morning usually continues to New York. Today it terminated in Philadelphia, a victim of the deluge delivered by Hurricane Irene. Amtrak explained: Most Northeast Regional service will operate south of Philadelphia, but no Acela Express, Northeast Regional or other Amtrak trains can operate north of Philadelphia to New York. As of early this Monday evening, about a half-mile of Amtrak right-of-way remained submerged near Trenton, N.J. As the water levels recede, Amtrak engineering forces will make repairs to the track and signal control infrastructure. Updates will continue to be provided and an estimate for restoration of full service south of New York is not yet available. Many attribute the recent spate of natural disasters (heat waves, droughts and wildfires in Texas, tornadoes in Missouri and Alabama, Hurricane Irene) to the effects of climate change. We reserve judgment. Climate change is about trends, not individual events. One trend we are watching closely is the status of flood plains. We dug up the Flood Insurance Rate Map for the Trenton train station. The Amtrak right of way mentioned above is in the 100 year flood plain. We weren't able to determine how many times it had flooded recently, but the mayor of nearby Lambertville noted that they have been flooded out 5 times in the last ten years.   The flood at the train station was a record, nearly seven feet above flood stage.  Id. And  a study out of the University of New Hampshire  reports New Hampshire has experienced 4 100-year floods in the last four years.  Some may discern a trend. Fortunately, we are not the only ones watching. FEMA is in the process of preparing a report on climate change impacts on the National Flood Insurance Program. Preliminary information indicates that some Special Flood Hazard Areas (the 100-year flood plain) will double in size and that by the next century the nation's flood plain will be 40%-45% larger.  Look for The Impact of Climate Change on the National Flood Insurance Program to be out this fall. FEMA currently does not directly address climate change in the NFIP, because its practice is to make its assessment based on the historical record.  But that does not mean communities and businesses cannot.  For example, a community may request that the applicable Flood Insurance Rate Map address future conditions.  44 CFR 64.3(a)(1).  Where business continuity planning is standard practice (and we hope that is everywhere) vulnerability assessments need to ask not only where is the flood plain, but where is it likely to be.  Many have been off to a slow start on climate change planning.  But, as with trains, late is better than never. View of Trenton Amtrak right of way (c) Times of Trenton

Climate Change | Climate Change Effects | Flood Insurance | Regulation

National Weather Service 30-Year Averages Confirm the Climate is Getting Hotter in the U.S.

August 4, 2011 19:36
by J. Wylie Donald
Half a degree doesn't sound like much. And it isn't, if you are talking about a baccalaureate. But in a world of climate change, a half a degree increase in Baltimore's average temperature combined with average temperature increases in all the lower 48 states is confirmation of what the scientists are telling us:  the planet is warming.  Thus, the National Weather Service's release on Monday of revised 30-year average temperatures gives some satisfaction, or at least Schadenfreude, to those trying to lead (or push) their organizations into proactively managing climate change. Or does it?  Here is how this news was reported in Tampa, Florida  "Some of the changes emerge from tossing out statistical peaks and valleys from the 1970s, the weather service says. A shift in instrument locations could explain more change. And the continued development around Tampa International Airport and Tampa in general could account for some of the warmer nights that helped push average temperatures higher for April through August. A slight shift in equipment location at Tampa International Airport could also influence the low morning readings, the weather service says. Or, the overall reason also could be changes in global climate, but that’s impossible to determine from readings at one location, the weather service says." So if this is all statistics, what is one to do?  You could instead get your weather news from Montgomery, Alabama, which reported on the same news: Updated theories of global warming and climate change predict a pattern of increasing temperatures. The theories are based on an increased amount of carbon dioxide in the atmos­phere leading to high tempera­tures. The shift in temperatures is more likely associated with the Pacific Decadal Oscillation, said Dr. Roy Spencer, a princi­pal research scientist at the University of Alabama in Huntsville. Spencer also has served as a senior scientist for climate studies at NASA's Mar­shall Space Flight Center in Huntsville. So which is it?  Statistics, decadal oscillation or climate change?  The statistics answer is easy to discern.  For Tampa, scientists cannot say that its temperature specifically is driven by climate change.  But when the whole country is changing, that is a different story.  Montgomery is a little more difficult.  I tracked down Dr. Spencer's webpage  and learned that he believes, "Climate change — it happens, with or without our help."  His research is into whether the climate change we are observing is natural or man-made.  He agrees that the climate is changing. This seemingly disparate information contains a valuable lesson.  Where there is no controversy or skepticism, it is easy to make choices of what to do.  Where controversy surfaces, however, to move forward, one needs to understand precisely what is controverted.  And often, of course, that will have to be done by degrees as understanding matures.

Climate Change | Climate Change Effects | Weather

The Debt Ceiling Furor Will Change the Climate of Climate Change Responses

July 27, 2011 19:12
by J. Wylie Donald
We hope you don't come to this blog for stock tips but it doesn't take John Bogle to know that the debt ceiling impasse and the budget furor do not bode well for renewable energy stocks.  Citing the debt crises and oversupply, here is how one report put it:  "One of the biggest losers on the day was the PowerShares WilderHill Clean Energy Portfolio (PBW) which slumped by 1.4% to open up the week."  So where else is the national obsession on the nation's debt going to take a bite out of responses to climate change.  We tracked down a few subjects. Carbon Dioxide Regulation - Efforts by House Republicans to defund USEPA's steps to regulate carbon dioxide resulted most recently in H.R. 2584, the proposed Department of the Interior, Environment, and Related Agencies Appropriations Act of 2012.  Section 453 provides, among other things, that "None of the funds made available under this Act shall be used--(1) to prepare, propose, promulgate, finalize, implement, or enforce any regulation pursuant to section 202 of the Clean Air Act (42 U.S.C. 7521) regarding the regulation of any greenhouse gas emissions from new motor vehicles or new motor vehicle engines that are maufactured after model year 2016 to address climate change; ..."   This is not a new tactic.  It is probably fair to say that what is in the works now at EPA is not what will be the final word. Tax Credits - Under § 1603 of the American Recovery and Reinvestment Tax Act renewable energy project developers may take cash payments in lieu of the investment tax credits.  The Treasury reports over 7000 projects funded to the tune of $6.4 billion, resulting in total investment of $21.6 billion.  Although the credits do not expire until October 2012, some think they are under the gun right now.  Ethanol - The most subsidized part of the renewable energy mix, ethanol producers and corn farmers received a stern message on June 16 when Senator Dianne Feinstein obtained a symbolic vote (73-27) in favor of ending ethanol subsidies on July 1.  The White House promised a veto and the proposal has not gone anywhere in the House. Energy Efficiency - Congress can't figure out the debt ceiling mess but remains expert at creative bill naming.  H.R. 2417, the Better Use of Light Bulbs (BULB) Act, passed overwhelmingly, but didn't take effect because of the procedural rule adopted to permit a vote, which required a supermajority.  The bill would have repealed certain provisions of the Energy Independence and Security Act of 2007 that prescribed energy efficiency standards for incandescent lamps (among other things). We are sure there are others.  Notwithstanding that the Energy Independence and Security Act of 2007 passed both houses of Congress by wide margins, the winds of change are now blowing hard and furiously.  Where all these programs will be when the furor over the debt ceiling subsides is unknown, but no one can dispute that the climate has changed.

Carbon Emissions | Climate Change | Legislation | Renewable Energy

Comer Resurgens: Life After American Electric Power v. Connecticut

July 7, 2011 10:23
by J. Wylie Donald
We thought last January, when the Supreme Court denied a writ of mandamus, that the long saga of Ned Comer through the courts had finally come to an end.  We were wrong.  At the end of May, the case, Comer, et al. v. Murphy's Oil USA, et al. (attached), was refiled in the Southern District of Mississippi.  Although predating the Supreme Court's June decision in American Electric Power v. Connecticut, one could be excused for concluding that it was filed afterward as it relegates federal common law to a sentence and instead is all about state law causes of action. But before we get into the resurgent Comer, we thought we would point out a June paper published by the Geneva Association, an insurance industry think tank.  One of the industries most affected by climate change is insurance. In Why Insurers Should Focus on Climate Risk Issues, Chief Climate Product Officer, Lindene Patton, outlines some of the risks and opportunities she perceives.   Her perspective is particularly worth considering as her employer, Zurich Financial Services, faces climate change issues across a broad spectrum of activities. (Ms. Patton notes, however, that the positions in the paper are hers alone.) Ms. Patton's views are insightful:  "society at large appears increasingly underinsured for the impacts of climate change at the time of its greatest need."  And they are ominous:  "Unless global societal risk management of climate change improves, the mismatch between the loss exposure and monies needed to cover economic loss associated with climate change-related severe weather events and other impacts will only become more extreme."  The solution she calls for is for insurance companies to take the lead to overcome the current "governance gap with respect to climate change policy."  Even without leadership, important social decisions can be made if the right price signals (i.e., premiums) are sent. Such signals can lead to "cogent risk management decision-taking" and assist in the spreading and management of climate change risks. An example of such price signals from an earlier period are the fire proofing of much of America as the result of the insurance industry's support of fire codes and the underwriting to go with them. The alternative to leadership in the marketplace is what Ms. Patton refers to as the frictional costs of litigation. In some cases those costs can be trivial, such as occurred with Y2K. In other cases, the outcomes can be devastating -- think asbestos and tobacco, on which insurers have paid, by some estimates, $150 billion and $750 billion respectively. Driving litigation in the climate change sphere is the relatively unknown fact of "a trend of decreasing percentage of insured loss when calculated as a percentage of damages from extreme weather events on an annualized basis."  Stated more simply, those harmed by hurricanes are not insured or are underinsured and the path to being made whole lies with a judge, not with an adjuster. The litigation path is not set out in black and white. Yet. But there are areas that may be fruitful for plaintiffs. Ms. Patton identifies SEC disclosure rules, fractional allocation (market share) schemes, and de minimus liability regimes as potential routes for "activist judges to find liability associated with" greenhouse gas emissions.  Regardless of the theory du jour, the ongoing injuries and displacement caused by climate change "may ultimately end up over a number of years in dedicated, repeated efforts by plaintiffs to find a legal theory that 'sticks' as happened in tobacco or asbestos." Which brings us back to Ned Comer and his protean and unvanquishable litigation.  All remember Hurricane Katrina; most will recall the lawsuit filed 20 days after Katrina made landfall.  In various iterations it sued insurance companies, mortgage lenders, oil companies, electric utilities, coal companies, and chemical companies; it alleged against all of the greenhouse-gas-emitting defendants responsibility for Katrina's "unprecedented" ferocity.  Its appellate travails are legend.  Following dismissal in the district court, and reinstatement by a Fifth Circuit panel, that decision was vacated when the Fifth Circuit accepted the case for en banc argument, and then dismissed the case when its quorum dissolved.  The petition for mandamus did not avail and everyone thought the case was gone. Everyone, that is, except Ned Comer's lawyers.  On May 27, 2011 Comer v. Murphy Oil USA, Inc. was re-filed.  It is a monstrous class action lawsuit with over 90 named corporate defendants - a crowd even larger than the earlier iterations of the case.  Like a Who's Who of particular industries, it alleges against classes of oil companies, utilities and coal companies, and chemical companies claims in three counts of public and private nuisance, trespass and negligence. But it also includes, almost as afterthoughts, a strict liability claim (¶ 36) and a conspiracy claim (¶ 41).  It concludes with a count for a declaratory judgment that federal law does not preempt state law claims. Ms. Patton's frictional costs are here in vast numbers.  As is her recognition that it is injury rather than an interest in climate change policy that provides the litigation incentive:  "Plaintiffs do not ask this Court to regulate greenhouse gas emissions or change national policy regarding climate change. Instead, Plaintiffs seek legal redress for the damages caused by these Defendants."  (¶ 11). Those damages are broad.  "[Plaintiffs'] homes and property were destroyed by Katrina's destructive winds and storm surge, which effects were increased in frequency and intensity by Defendants' emissions of greenhouse gases." (¶ 18)  "Plaintiffs' property also is damage[d] by sea level rise as a result of submersion and/or increased exposure to hurricanes. (¶ 19) "Plaintiffs' insurance premiums for their coastal Mississippi property have risen dramatically, and the resale values of their homes and property values have plummeted."  (¶ 20) The insurance premium allegation is thought-provoking.  Plaintiffs recognize that proving a particular defendant caused Hurricane Katrina will be difficult. Pleading in the alternative, they assert that the Defendants' greenhouse gas emissions "put Plaintiffs' property at greater risk of flood and storm damage, and dramatically increase Plaintiffs' insurance costs." (¶ 37) They link insurance company efforts to price climate change risk to increased premiums (Ms. Patton's risk-based price signals), and, because those "insurance costs attributable to global warming are distinct and quantifiable", they assert they are entitled to recovery. (¶¶ 38-40)  This theory of damages based on increased risk, rather than actual harm, bears watching. Ms. Patton concludes, "the AEP case only addresses nuisance cases and does not address broader theories under tort liability law.  A verdict for the defendants on the nuisance issue may not arrest the flow of cases and associated defence costs.  The plaintiffs bar may still continue to file demands and claims for other types of tort damages."  We would go further. With apologies to Atlanta, Comer Resurgens demonstrates that the conditional "may" is being replaced by the declarative "will." 20110527 Comer v. Murphy's Oil (re-filed) Complaint.PDF (796.31 kb)

Climate Change | Climate Change Litigation | Greenhouse Gases | Insurance | Supreme Court

Coal Exports and Rising Temperatures

June 13, 2011 04:33
by J. Wylie Donald
Front page news in Baltimore this past week were two stories. The first notes record temperatures in Maryland in the first full week of June, 2011.  The second was a lead article this Sunday on the record year the Port of Baltimore is having moving coal from the mines of Appalachia to the coke ovens of Asia. It does not take a Shakespeare schooled in climate change to grasp the irony. First, the weather. Central Maryland suffered four 90-plus record highs in ten days, topping out at Baltimore-Washington International Airport at 99 degrees on June 8.  The summer (which hasn't even started yet) is picking up where last year left off as being the hottest on record for Baltimore.   Now, the coal. Ships are literally waiting in line in Chesapeake Bay to get a place at the pier to load the high quality anthracite "metallurgical" coal that this part of the world produces in abundance. Freight trains deliver millions of tons to two private terminals, which load ships capable of carrying 77,000 tons of the black stuff, or even 135,000 tons.  The Port of Baltimore is on track to ship over 14 million tons this year. For comparison this is almost 3 times the pre-recession volume of just 5 years ago. More jobs, more dollars, more activity. Of course, not everyone is happy. The Sierra Club points out that shipping coal is not consistent with being a leader on combating global warming. But the Sierra Club has no present intent to attempt to interfere with exports (but they will object to increasing the size of the Port). Not so across the continent.  Seems the Asian appetite for coal is also seeking the carbon of Montana and Wyoming.  The difference is that on the West coast the only dedicated coal terminal is in British Columbia.  Washington State is seeking to build new coal terminals with the first being at Longview.  Montana interests are excited at the prospect.  In Washington, however, the Sierra Club and others are opposing such activities and have appealed the Cowitz County commissioners' approval of an application to build a new coal terminal.    Besides the usual types of challenges to mining and transport in the domestic realm, the appellants also assert that the commissioners should have studied the consequences of burning coal in Asia.  This is novel.   My colleague, classmate and Seattle Port Commissioner John Creighton shared with me the implications:  "While many in Washington State are sympathetic to the environmental community's concerns over the ultimate impact of a large dirty coal export operation on global warming, the port community is apprehensive about how such a precedent might affect the environmental review process on other port projects.  For example, in looking to permit an airport project, would we be required to go beyond the airport grounds and consider greenhouse gas emissions of a British Air nonstop all the way from Seattle to London?  On a container terminal project, would we have to trace the greenhouse gas impacts of every possible product transportable in a container?" Commissioner Creighton's concerns are well-founded.  What are the limits of environmental impact assessments?  This approach by environmental groups - looking at the entire chain of events in a particular activity - is well-tested, however.  New nuclear power was stopped in California by focusing on California waste disposal law.  See Pacific Gas & Elec. Co. v. State Energy Resources Conservation & Development Comm'n, 461 U.S. 190 (1983).  Chemical weapons disposal was challenged (unsuccessfully) by attacking the environmental impact statement and transportation across the "global commons."  See Greenpeace USA v. Stone, 748 F. Supp. 749 (D. Haw. 1990), dismissed as moot, 924 F. 2d 175 (9th Cir. 1991). So, it is hot in Maryland.  And elsewhere.  Notwithstanding the pass current coal shipping operations have in the East, the West may hold a lesson on whether this will continue to be business as usual.

Climate Change | Climate Change Litigation | Regulation

Predicting Sea Level Rise - The Arctic Council Raises the Ante

May 16, 2011 20:27
by J. Wylie Donald
Last Thursday Secretary of State Hilary Clinton and other prominent diplomats signed the first ever treaty under the auspices of the Arctic Council; specifically, the member nations addressed Arctic search and rescue, made necessary by the increasing traffic in the formerly ice-locked realm caused by the reality of Arctic warming. Less noticed, perhaps, was the release of a report by the Council's Arctic Monitoring and Assessment Program (AMAP).  Among other things, the report, Snow, Water, Ice and Permafrost in the Arctic, forecasts up to a 5-foot rise in sea level by the turn of the century. This is real news because the earlier report in 2007 by the Intergovernmental Panel on Climate Change forecast an increase only one-third as large. We hesitated to report the AMAP conclusions because the last thing a law firm wants to be called is an alarmist, always sounding the air raid siren when a blip appears on the radar.   But, by the same token, counsel's fundamental role is to assist clients in addressing risks. That there are extreme views on almost any subject does not mean that the subject should be ignored. And the views here are not extreme.  Climate change is occurring. Prudence dictates that the effects be considered and addressed. The AMAP report is a product of the environmental assessment arm of the Arctic Council, an 8-nation group that considers how to promote sustainable development and environmental protection in the Arctic. The report picks up where the IPCC left off, when it forecast a sea level rise of between 7 and 23 inches by 2100. Left out of the IPCC analysis was the effect of the melting Antarctic and Greenland ice sheets because the science was undeveloped. Four years later, the Arctic Council has filled in that void and reached a startling result. According to the report's executive summary, the warming of the Arctic is having a dramatic effect. "A nearly ice-free summer is now considered likely for the Arctic Ocean by mid-century."  A "Key Finding" was that "global sea level is projected to rise by 0.9–1.6 m by 2100."  Translating, that is a sea level rise of between 3 and 5 feet by the end of the century. Shipping companies are salivating at the prospect of a straight shot over the roof of the world from Europe to Asia. Investors in the Panama Canal are less enthusiastic. What does all this mean for those considering their waterfront risks far south of the Arctic Circle?  Quite a bit actually.  The EPA offers some sobering data on its website. A two foot rise in sea level would eliminate almost 10,000 square miles of land (that is, an area exceeding all of Massachusetts). Damage from storms in a world with a 3-foot higher sea level would be 2 or 3 times as large. The salinization of coastal aquifers from salt water intrusion from rising sea levels threatens water supplies in Florida and south Jersey. It may seem like there is little that can be done if one is unwilling to abandon the shore.  But that would be a very shortsighted view.  Investors, lenders, developers and businesses involved with real estate near the shoreline should be considering the following 1. What interest in land should one acquire - a fee simple or a conventional 30-year lease?  The lessee, without a single additional word in its lease, may be protected from rising sea levels by the covenant of quiet enjoyment. The fee owner, on the other hand, bears all of the risk of a rising mean high water mark. 2. How effective are one's contracts' force majeure clauses?  Will performance be excused if one's facility is submerged?  What about if the local infrastructure goes underwater?  Does a condemnation action by governmental authorities trigger the provision? 3. Where exactly is mean high water?  Where will it be if the predicted rise occurs even in part?  What is the significance of that for the investment expectations of all involved? 4. What is the effect of a state statute that establishes the seaward property line at something other than the sea?  If this sounds nonsensical, it is the law in Florida, as confirmed by the U.S. Supreme Court in Stop the Beach Renourishment, Inc. v Florida DEP.  Florida's statutory "erosion control line" converted many beachfront properties, into beachview properties. And no, there was no compensable "taking." There are certainly others. The point is not to run about shouting "The sky is falling!". The point is to consider thoughtfully the possibility that the sky may fall and whether there is anything that can be done about it.

Climate Change | Climate Change Effects | Rising Sea Levels | Sustainability

Our Children's Trust Unleashes Wave of Climate Change Litigation

May 5, 2011 10:40
by J. Wylie Donald
When we wrote last month concerning the implications of the upcoming decision by the Supreme Court in American Electric Power v. Connecticut, we were fully expecting to wait for the decision to test our powers of prognostication.  We were very wrong.  In a collection of lawsuits and regulatory filings across the nation, environmentalists have joined the climate change litigation fray in a very big way.  Here is what we wrote:  "[A dismissal of Connecticut] says nothing about state law nuisance claims, nor new theories that have not yet been tested, nor even thought up. We strongly believe that carbon dioxide liability suits will be with us for a while yet. Our reason: climate change is ongoing and those whose interests are harmed will look for succor. So theories of liability will be spun and suits will be brought. And such suits will require a defense." Here is what has happened:  On Monday, May 4, in state courts across the nation lawyers representing children and young adults filed (and apparently will continue to file) suits seeking to compel State governments to recognize the application of the public trust doctrine to greenhouse gas emissions and to take action to abate those emissions.  The environmental group coordinating these actions is Our Children's Trust, based in Eugene, Oregon.  Its mission:  "Protecting Earth's Climate for Future Generations."  It is joined by Kids vs. Global Warming, whose "youth activists" are named plaintiffs in a number of the actions.  So far (according to the Associated Press), cases have been filed in California, Colorado, Minnesota, Montana, New Mexico, Oregon, and Washington, and also in federal court in California.  Our perception is that these jurisdictions are friendlier to environmental issues than other places.  In those other places regulatory petitions are being filed. We won't go into the details of all of these filings but here is the gist of the claims brought in New Mexico: Sanders-Reed v. Martinez.  New Mexico is at risk from the effects of climate change.  From loss of snowpack to drought to extreme heat waves, as temperatures rise life in New Mexico is being degraded.  Enter the State.  Before the current administration of Governor Martinez, New Mexico was taking steps to limit the discharge of greenhouse gases within New Mexico.  State agencies studied the problem and made recommendations.  The governor issued executive orders.  The Environmental Improvement Board promulgated greenhouse gas regulations.  New Mexico joined the Western Climate Initiative.  Id. ¶¶ 61-73, 76.  Then Governor Martinez took office at the beginning of this year.  According to the complaint, she attempted to block the publication of the greenhouse gas rules and announced that she would keep New Mexico from joining a regional cap-and-trade program. She also removed all of the members of the Environmental Improvement Board because she believed the Board was anti-business.  The Small Business-Friendly Task Force, created by the Governor, has recommended that New Mexico shift to “observer” status in the Western Climate Initiative. Id. ¶¶ 74-76.  Plaintiffs, one teen-ager (a member of Kids vs. Global Warming) and one environmental group, sued under the public trust doctrine, which has not yet been applied to the atmosphere.  In a nutshell, plaintiffs assert that "Defendant State of New Mexico has failed in its fiduciary duty to recognize and protect our atmospheric public trust resource, thereby injuring these Plaintiffs."  Id. ¶ 19.  In more detail, plaintiffs desire a declaration by the New Mexico court that "(1) the public trust doctrine is operative in New Mexico and, pursuant to this doctrine, the State holds the atmosphere in trust for the public; (2) the State has an affirmative fiduciary duty to establish and enforce limitations on the levels of greenhouse gas emissions as necessary to protect and preserve the public trust in the atmosphere; (3) the State’s fiduciary duty to protect the atmospheric trust is defined by the best available science; and (4) the State has breached its fiduciary duty to protect the public trust in the atmosphere by failing to exercise its right of control over the atmosphere in a manner that promotes the public’s interest in the atmosphere and does not substantially impair this resource."  One will note that the claim is for declaratory relief, but not damages.  Plaintiffs' goal is to stabilize before 2100 the earth's atmosphere at 350 ppm carbon dioxide.  Id. ¶¶ 51-53.  Today it is at 390 ppm and increasing.  Id. ¶¶ 43, 45.  Failure to achieve such stabilization will lead to catastrophe.  Id. ¶ 46. (If you wish to read other complaints and petitions, visit Our Children's Trust's website.) There are a host of issues before these lawsuits are successful.  First, is the atmosphere subject to the public trust doctrine?  Second, can private parties require the State to act to preserve that trust?  Third, what are the elements of standing for those parties?  Fourth, what is the "best available science"?  Fifth, could federal preemption apply?  And probably many more.  But plaintiffs have a lot of opportunities to address these questions and will undoubtedly learn from one case so as to improve the others. In the meantime, the battle for control of the public dialog will continue.  Environmentalists have chosen a broad-based attack and will certainly make the most out of any successes they have.  Further, although we will not link the Tuscaloosa tornadoes and this year's record Mississippi flooding to climate change, some certainly will because more extreme weather is a central prediction of the climate change story.   Those kinds of extreme weather events may be all that is necessary to push climate change back onto the federal agenda.   Perhaps the most interesting facet of this set of cases is how it juxtaposes with Connecticut.  In that case, States are suing private parties to compel them to abate carbon dioxide emissions.  Commentary on the Supreme Court argument suggests that the Court may have some sympathy to States who are trying to remedy a problem that the federal government is ignoring.  Now private parties are suing those same State governments asserting that they are not doing enough either. And where does all this leave our prediction.  We are right about new theories, right about claims of ongoing injuries and right that more suits would be brought.  We are wrong that those suits would be suits for liability.  We are wrong today, anyway.

Carbon Dioxide | Climate Change | Climate Change Litigation | Greenhouse Gases | Supreme Court

McCarter & English’s Climate Lawyers Blog Named to LexisNexis’ 2011 Top 50 Environmental Law & Climate Change Blogs List

April 29, 2011 06:58
by noauthor
McCarter & English is pleased to announce that the firm’s ClimateLawyers.com blog has been selected by LexisNexis as one of the Top 50 Blogs for the Environmental Law & Climate Change Community. McCarter & English LLP is pleased to announce that the firm’s ClimateLawyers.com blog has been selected by LexisNexis as one of the Top 50 Blogs for the Environmental Law & Climate Change Community. The list recognizes preeminent thought leaders in the blogosphere that are creating invaluable content for all segments of the environmental law and climate change practice. “Most good blogs provide frequent posts on timely topics, but the authors in this year’s collective take their blogs to a different level by providing insightful commentary that demonstrates how blogs can—and do—impact the practice of environmental and climate change law,” said Tracie Morris, Web 2.0 Manager, for LexisNexis in an emailed statement. ClimateLawyers.com, launched in 2008, is dedicated to the discussion of legal, public policy, and business risk questions presented by climate change and renewable energy initiatives. Authors of the blog include McCarter partners J. Wylie Donald(Wilmington), Francis Kirk (Newark) and Grace Kurdian (New York) of the firm’s Climate Change & Renewable Energy Practice Groupin which Mr. Donald and Ms. Kurdian are co-chairs. Selection was partly based on commentary submitted to LexisNexis through the online community page which allowed members to share feedback and make suggestions for new blogs to be nominated. After the commentary stage, LexisNexis compiled the final list of nominees and then selected the Top 50 Environmental Law & Climate Change Blogs for 2011. It is expected that LexisNexis will soon put the matter to a vote inviting the online community to pick the Environmental Law & Climate Change “Blog of the Year.” “We are very pleased to be named to the Top 50 list and appreciate all of the support we’ve received from colleagues and clients in this endeavor,” said Mr. Donald. “Our site has existed for about four years and has a growing readership. As environmental concerns continue to exist in our communities and inside the courtroom, McCarter is working to be at the forefront of the discourse. Our experienced team draws from the firm’s insurance coverage, energy, environmental, tax, real estate, litigation, and intellectual property lawyers to address the myriad legal needs of our clients in these areas. We look forward to continuing a healthy and persuasive conversation about the issues affecting companies and our communities.” About McCarter & English McCarter & English, established more than 160 years ago, represents Fortune 500 and middle-market companies in their national, regional and local litigation and on important transactions. Its 400 attorneys are based in offices in Boston, Hartford, New York, Newark, Philadelphia, Stamford and Wilmington. http://www.mccarter.com

Climate Change | Year in Review

Oral Argument in Steadfast v AES Seemed to Favor AES

April 20, 2011 07:25
by J. Wylie Donald
Supreme Court argument is delicious - for lawyers anyway. Following months of preparation, thousands of pages of research, and draft after draft, finally the parties are called to the fore and bluntly told: "Make your best arguments, counsel." In that context, I ventured to Richmond, Virginia this morning to hear the able presentations on behalf of The AES Corporation (appellant - insured) and Steadfast Insurance Company (appellee - insurer). The parties were locked in a contest over who should pay for the defense of Native Village of Kivalina v. ExxonMobil Corp., the climate change liability suit emanating from the northern shores of Alaska, where native Inupiat residents assert that various utilities, oil companies and a coal company are liable for the emission of carbon dioxide, which resulted in global warming, which melted winter sea ice, which loss permitted fierce winter storms to erode the peninsula on which the residents made their home. The case is the first climate change coverage case with all the implications primacy may have. In the proceedings below, the trial court had initially denied the insurer's motion for summary judgment based on (as argued by the insured) the existence of factual issues. The court specifically held that it could not decide whether the pollution exclusion could be applied. The insured then turned around and filed its own summary judgment motion on the duty to defend. The insurer cross-moved and argued that there was no "occurrence" as the allegations in Kivalina were all intentional acts leading to reasonably foreseeable injury. It also argued that the policies' pollution exclusions applied. The court issued a terse order: "no 'occurrence' as defined in the policies has been alleged in the underlying Complaint." With this prelude, the parties crossed lances before seven justices of the Virginia Supreme Court. In our view, the insured carried the day (and, as explained below, this is not just because AES cited our law review article in their reply brief). Counsel kept it simple. First he opened with a nod to the pollution exclusion and emphasized what was clearly set out in the briefs: the pollution exclusion issue was decided in the insured's favor (the court ruled a fact issue existed) and the insurer did not assign cross-error in its response to the insured's appeal. Accordingly, there was no issue before the Court. Next he turned to the issue that was appealed: whether an allegation of negligence, even if mixed in with numerous allegations of intentionality, constituted an "occurrence." More specifically, did the allegations of Kivalina contain an "accident"? Accident was undefined in the policies, but well-defined under Virginia law. Even if the act was intentional (such as the emission of CO2 by a utility), if the harm was unplanned, the carrier was required to defend. An allegation that the alleged tortfeasor "should have known" (as was asserted in the Kivalina complaint) was sufficient to establish the duty to defend. In keeping with his theme, counsel provided a simple example: if he intentionally changed lanes, but failed to look in his rear-view mirror and clobbered someone, surely that was covered. And it would be covered even if it was reasonably foreseeable that someone would be injured if he failed to look. It was a good example (as we will discuss). Counsel for Steadfast likewise appeared to be starting her discussion with the pollution exclusion. Labeling it a "toxin" (a poisonous substance that is a specific product of metabolic activities ???), she then proceeded to make the point that the insured was sued for its routine business decisions, which insurance does not cover. Further, if the four corners of the policy are compared with the four corners of the complaint (the so-called 8-corners rule which is adopted in Virginia) then it is beyond cavil that the Kivalina plaintiffs alleged that AES knew it was emitting carbon dioxide and knew that that would cause harm. At which point Justice Mims interrupted and attempted to pin down the parties' positions. As he heard it, the insurer argued that there was no coverage for intentional acts with known consequences, and AES argued coverage was lost only for intentional acts with intentional consequences. Insurer counsel refined that slightly: coverage was lost for intentional acts with reasonably anticipated consequences. And then that automobile example resurfaced - embraced by the chief justice. Frankly, I did not follow insurer counsel's rejoinder but I will attempt to recreate it. First, the policy's terms address "accidents" not negligence. Negligence is not necessarily the same as an accident. For example, while speeding and hitting someone would be both an accident and negligent, drag racing and hitting someone might be negligent but it would not be an accident. Furthermore, mere words in a complaint (like the "negligence" used in the Kivalina complaint) were not sufficient. The court must look, counsel argued, to the "facts and circumstances," which showed that there was no error, no mistake, no mishap. It was volitional and deliberate conduct. Counsel then turned to the pollution exclusion and pointed out that the Kivalina complaint talked about pollution everywhere. "But," pointed out Chief Justice Kinser, "isn't the only ruling below that there was a fact issue precluding summary judgment?" Justice Mims chimed in and emphasized the failure to assign cross-error. Although insurer counsel asserted that it was argued on the second motion, Chief Justice Kinser spoke again and affirmed that there needed to be cross-error assigned. Rebuttal was quick. Counsel stated: "We won the pollution exclusion issue and the trial court never ruled differently." And he effectively brought up again his lane-changing example. "If the Court adopts the insurer's position there will be no coverage in lots of areas because foreseeable harm is common. The issue is whether the harm was intended." Prognostication is the devil's own but one can't help oneself. The pollution exclusion issue seems that it will be decided entirely on procedural grounds: as it was not raised below, it was not preserved for appellate review. The occurrence issue is a little more difficult but, as was effectively pointed out in the moving brief and in argument, the Kivalina plaintiffs chose their words and they chose negligence. How could the Court possibly ignore that?

Carbon Dioxide | Climate Change | Climate Change Effects | Climate Change Litigation

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Legislative Initiatives to Reduce Stormwater Runoff, Part 3

March 17, 2011 15:37
It appears that the sponsors of the legislation recognized that behavioral change is more likely to occur successfully when positive reinforcement is provided rather than simply mandating compliance with change.  To that end the proposed legislation seeks to create positive financial incentives to spur private development projects that would reduce stormwater runoff through the use of Green or Blue roofs.A3682:  Would provide low interest loans to private parties to build green or blue roofsMany jurisdictions provide financial incentives for “Green” or sustainable design and construction.  This bill would amend the law known as the “Regional Greenhouse Gas Initiative” to allow funds from the “Global Warming Solutions Fund” to be used to extend low interest loans to private parties, including homeowners and owners of commercial, industrial, and institutional entities.Material terms of the loans would require: a) that they be made for no more than 85% of the cost of the Green or Blue roof; b) that the term not exceed 20 years; c) that the interest rate be low, and not to exceed 4%; and d) that loans be secured by a promissory note that requires the loan to be repaid if the property is sold or transferred or that requires the purchaser to assume the loan.In addition to specifying which agencies would be responsible for the financial aspects, broad powers are being given to the Department of Environmental Protection and the Department of Community Affairs to oversee and review construction to ensure compliance with the standards that are established.This incentive is no doubt socially desirable.  However, given the fiscal crisis that is faced by New Jersey, and many other states, it is questionable whether financial resources will be available to fund this program at any meaningful level.  There have already been efforts to erode the Global Warming Solutions Fund and such efforts are likely to continue until the economic climate changes significantly.   A3678:  Requires preferential ranking for projects that seek funding from an environmental infrastructure programThe least sexy of the companion bills, this would require the Department of Environmental Protection to provide a preferential ranking to projects that seek funding from an Environmental Infrastructure Financing Program to those projects that include Green or Blue roofs.  Hardly anything controversial in this bill.  For other states it provides an example of positive incentives that can be offered to developers of construction projects.As set forth in this series of posts collectively these bills seek to address a serious problem that many are facing with respect to stormwater management.  These efforts have been noticed by environmental groups.  Jeff Tittel, the director of the New Jersey Chapter of the Sierra Club observed: “It actually helps deal with something called combined sewer overflow which is very much a problem in urban older communities where a lot of rainwater comes off of roofs, gets into the sewer systems, and then the sewer systems cannot handle the higher flow.  So what happens is when you get heavy rainstorms, you get partially treated sewage and sometimes raw sewage going out into our rivers”.Results of a study completed in 2009 by the Penn State Green Roof Center of Pennsylvania State University at University Park, PA indicated that, “green roofs are capable of removing 50% of the annual rainfall volume from a roof through retention and evapotranspiration”.  Accordingly, the effectiveness of Green roofs in combating excessive stormwater runoff cannot be denied.  [Green Roofs for Stormwater Runoff Control, National Risk Management Research Laboratory, Publication EPA/600/R-09/026, February, 2009]The extent to which these new measures, if the legislation passes, will assist in stormwater management and controlling water quality remains to be seen.  Two things are certain: 1) the stormwater problem and associated flooding is increasing; and 2)  New Jersey and other states are likely to require a change in design and construction in order to confront the problem.  Think about that the next time that flooding harms your neighbors or inconveniences you.  I know that I will.

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