Updates to the Climate Change Litigation Charts – August and September 2016

Each month, Arnold & Porter and the Sabin Center for Climate Change Law collect and summarize developments in climate-related litigation, which we also add to our U.S. and non-U.S. climate litigation charts.  If you know of any cases we have missed, please email us at columbiaclimate at gmail dot com.

Here are the additions to the litigation charts since update #88:

FEATURED CASE (September)

Seventh Circuit Upheld Department of Energy’s Reliance on Social Cost of Carbon for Efficiency Standards

The Seventh Circuit Court of Appeals upheld the United States Department of Energy’s (DOE’s) energy efficiency standards for commercial refrigeration equipment, including DOE’s analysis of the standards’ environmental benefits based on the Social Cost of Carbon (SCC). The court concluded that DOE had “acted in a manner worthy of our deference.” The court found that the analytical model upon which the standards were based and DOE’s cost-benefit analysis were supported by substantial evidence and not arbitrary and capricious. The court also said that DOE’s cost-benefit analysis was within its statutory authority. With respect to environmental benefits and the SCC, the court rejected the petitioners’ argument that the Energy Policy and Conservation Act did not permit consideration of environmental factors and also the petitioners’ contention that DOE’s calculation of the SCC was “irredeemably flawed.” The court also rejected arguments that DOE had improperly considered long-term environmental benefits such as carbon reductions but not long-term costs such as worker displacement and that DOE arbitrarily considered global benefits but only national costs. Zero Zone, Inc. v. United States Department of Energy, Nos. 14-2147 et al. (7th Cir. Aug. 8, 2016): added to the “Challenges to Other Federal Action” slide

 September 2016 update (#90)

DECISIONS AND SETTLEMENTS

The D.C. Circuit Court of Appeals authorized intervention by the American Petroleum Institute and Dominion Cove Point LNG, LP in Sierra Club’s challenge to DOE’s authorization of the export of liquefied natural gas (LNG) from the Cove Point LNG Terminal in Maryland. During the administrative process leading up to the export approval, DOE rejected Sierra Club’s arguments that its environmental review should have accounted for indirect effects including greenhouse gas emissions from induced natural gas production and increased coal consumption. Sierra Club v. United States Department of Energy, No. 16-1186 (D.C. Cir. Aug. 8, 2016): added to the “Stop Government Action/NEPA” slide.

Alaska Federal Court Entered Final Judgment Dismissing Challenges to Polar Bear Critical Habitat

The federal district court for the District of Alaska entered final judgment dismissing three actions that sought to undo critical habitat designation for polar bears under the Endangered Species Act. The dismissal came several months after the Ninth Circuit Court of Appeals reversed the district court’s earlier decision vacating the designation. Alaska Oil & Gas Association v. Salazar, Nos. 3:11-cv-00025-RRB et al. (D. Alaska Aug. 8, 2016): added to the “Endangered Species Act” slide.

On remand from the California Supreme Court, the California Court of Appeal concluded that thresholds of significance based on impacts on a proposed project’s occupants (receptor thresholds) could be used for some purposes in reviews under the California Environmental Quality Act (CEQA), though such thresholds could not be used  to require an environmental impact report or mitigation measures based solely on the impacts of the existing environment on a proposed project. (The California Supreme Court held in December 2015 that portions of the statewide CEQA guidelines that required consideration of the impacts of existing conditions were not valid.) The California Court of Appeal considered how the Supreme Court’s decision applied to receptor thresholds established by the Bay Area Air Quality Management District (BAAQMD) for toxic air contaminants and fine particulate matter. (BAAQMD’s receptor thresholds for greenhouse gases were not specifically at issue in this case.) In its August 2016 decision, the appellate court said that permissible uses of the receptor thresholds included voluntary application by lead agencies when considering their own projects and when considering whether a proposed project would exacerbate existing environmental conditions, as well as for school projects and in connection with certain CEQA exemptions for housing developments. The appellate court left open whether the thresholds could be used for determining whether a proposed project is consistent with a general plan.California Building Industry Association v. Bay Area Air Quality Management District, Nos. A135335, A136212 (Cal. Ct. App. Aug. 12, 2016): added to the “State NEPAs” slide.

The Delaware Superior Court denied as futile a motion to amend a complaint challenging Delaware’s regulations implementing the Regional Greenhouse Gas Initiative. The plaintiffs sought to correct the middle initial of a plaintiff. They argued that the defendants were aware of the actual identity of the plaintiff and knew that he—not his deceased father, with whom the actual plaintiff shared a first and last name but not a middle initial—was the intended plaintiff. The court said that amendment would be futile because the plaintiff would not have had standing based on his stake in a company that was a commercial purchaser of electricity. Stevenson v. Delaware Department of Natural Resources and Environmental Control, No. S13C-12-025 RFS (Del. Super. Ct. Aug. 19, 2016): added to the “Challenges to State Action” slide.

California Court Ordered Suspension of Work on Intermodal Rail Facility Pending CEQA Compliance

A California Superior Court granted a peremptory writ of mandate setting aside approvals for the Southern California International Gateway project, an intermodal railyard facility intended to handle containerized cargo moving through the Ports of Los Angeles and Long Beach. The court required respondents to suspend all project activities until actions had been taken to bring the respondents’ determinations, findings, and decisions into compliance with the California Environmental Quality Act (CEQA). The court’s judgment followed a March 2016 opinion and order that identified numerous shortcomings in the CEQA review, including inadequate consideration of greenhouse gas impacts. Fast Lane Transportation, Inc. v. City of Los Angeles, Nos. BS143332 et al. (Cal. Super. Ct. July 26, 2016): added to the “State NEPAs” slide.

Illinois Attorney General Settled With Alternative Retail Electricity Supplier Over Alleged Misrepresentations Regarding “Clean Energy Option” Product

On August 8, 2016, Illinois Attorney General Lisa Madigan announced a settlement with Ethical Electric, Inc., an alternative retail electricity supplier (ARES) that the attorney general contended misled consumers regarding the sources of energy provided through its “Clean Energy Option” product. The ARES direct mail solicitations promoted the product as providing power exclusively from renewable sources but the product instead provided power from a mix of sources matched with the purchase of renewable energy certificates (RECs). The attorney general also alleged that the ARES misrepresented the cost of the Clean Energy Option and misrepresented the Clean Energy Option as “licensed” for “green energy” supply. The settlement, which the attorney general entered into under authority of the Illinois Consumer Fraud Act, provided for a $10 refund for consumers enrolled in the product as well as additional refunds to eligible consumers upon request, a renaming of the product, and increased transparency regarding products, including disclosure of the purchase of RECs. In re Ethical Electric, Inc. (Ill. Att’y Gen. Aug. 8, 2016): added to the “Regulate Private Conduct” slide.

EPA Said It Would Not Investigate Nonprofit Group’s Allegations of Methane Leakage Cover-Up in Natural Gas Industry

The United States Environmental Protection Agency (EPA) Office of the Inspector General declined to open an investigation into an alleged cover-up regarding the extent of methane venting and leakage in the natural gas industry. EPA notified NC WARN, a nonprofit group that had submitted a complaint and request for information, of its decision on July 20, 2016. OnAugust 4, 2016, NC WARN requested that EPA reconsider its decision not to pursue an investigation, or provide a written explanation for not looking into NC WARN’s allegations. NC WARN Complaint and Request for Investigation, Hotline No. 2016-021(EPA OIG NC WARN letter Aug. 4, 2016; EPA letter July 20, 2016): added to the “Force Government to Act/Clean Air Act” slide.

NEW CASES, MOTIONS, AND NOTICES

D.C. Circuit Set Schedule for Clean Power Plan Oral Argument, Parties Argued for Relevance of Recent Clean Air Act Precedents

Oral argument on the Clean Power Plan will take place on September 27 in the D.C. Circuit Court of Appeals. The D.C. Circuit allocated time for argument over approximately three and a half hours on five categories of issues: statutory issues other than Section 112 of the Clean Air Act, Section 112, constitutional issues, notice issues, and record-based issues. In July and August, the petitioners and EPA submitted letters to the court to notify it of supplemental authorities—recent opinions issued by the D.C. Circuit and other circuit courts of appeal—that the parties believed to be pertinent and significant. Petitioners argued that the Fifth Circuit Court of Appeals’ stay of an EPA rule that disapproved state implementation plans from Texas and Oklahoma supported their argument that EPA’s assessment of grid reliability was insufficient. EPA said the ruling had minimal relevance and that none of the deficiencies identified by the Fifth Circuit were present in this case. EPA told the D.C. Circuit that the Seventh Circuit’s analysis upholding DOE’s consideration of the global benefits of reducing carbon emissions when setting energy efficiency standards would support EPA’s accounting for global benefits in the Clean Power Plan. The Clean Power Plan petitioners responded that the Seventh Circuit decision was not binding, involved a different statutory scheme, and did not address their arguments regarding comparison of global benefits and domestic costs. Clean Power Plan challengers also told the D.C. Circuit that its decision in a challenge to solid waste incineration units supported their argument that EPA could not base a standard based on averaging regulated sources’ and non-sources’ emissions, and that its decision upholding EPA’s withdrawal of a Clean Water Act disposal permit supported its arguments concerning consideration of costs. EPA said that these decisions did not support petitioners’ arguments. West Virginia v. EPA, Nos. 15-1363 et al. (D.C. Cir.): added to the “Challenges to Federal Action/Clean Power Plan” slide.

Briefing Schedule Set for Challenges to Carbon Emissions Standards for New Power Plants

After the D.C. Circuit Court of Appeals consolidated appeals of EPA’s denial of reconsideration of its final performance standards for carbon emissions from new, modified, and reconstructed power plants with the challenges to the original rule, the parties submitted a proposed briefing schedule, which the D.C. Circuit approved on August 30. Briefing will conclude on February 6, 2017. North Dakota v. EPA, Nos. 15-1381 et al. (D.C. Cir. joint scheduling motion Aug. 4, 2016): added to the “Challenges to Federal Action/Clean Power Plan” slide.

Lawsuit Filed to Void Oil and Gas Leases Until BLM Considers Climate Impacts

WildEarth Guardians and Physicians for Social Responsibility asked the federal district court for the District of Columbia to vacate authorizations for almost 400 oil and gas leases on public lands in three states because the United States Bureau of Land Management (BLM) had not complied with the National Environmental Policy Act (NEPA). The plaintiffs asked the court to enjoin BLM from approving drilling applications until it had complied with NEPA by preparing an environmental impact statement that analyzed direct, indirect, and cumulative climate effects associated with the specific leasing authorizations challenged in this case as well as with BLM’s oil and gas leasing at a programmatic level. WildEarth Guardians v. Jewell, No. 1:16-cv-01724 (D.D.C, filed Aug. 25, 2016): added to the “Stop Government Action/NEPA” slide.

Oil and Gas Trade Association Filed Suit to Compel BLM to Hold Quarterly Mineral Lease Sales

Western Energy Alliance, which represents over 300 companies involved in oil and gas exploration and production, filed an action in the federal district court for the District of New Mexico asserting that the United States Bureau of Land Management (BLM) had failed to meet the Mineral Leasing Act’s (MLA’s) requirement that lease sales for federal minerals be held at least quarterly. Western Energy Alliance asked the court to compel BLM to abandon its current leasing schedule and adopt a new schedule in compliance with the MLA. Western Energy Alliance also alleged that BLM had unjustifiably denied requests under the Freedom of Information Act. In ablog post announcing the action, Western Energy Alliance said that the lawsuit would counter the “Keep-It-in-the-Ground” movement. Western Energy Alliance v. Jewell, No. 1:16-cv-00912 (D.N.M., filed Aug. 11, 2016): added to the “Challenges to Other Federal Action” slide.

More Parties Joined Challenge to EPA Oil and Gas Methane Standards

Fifteen states and a number of trade groups joined early filer North Dakota in challenging EPA’s methane emission standards for new, reconstructed, and modified sources in the oil and natural gas sector. The D.C. Circuit consolidated all nine petitions, with North Dakota’s proceeding as the lead case. The petitioners said they would establish that the regulations exceeded EPA’s statutory authority and were arbitrary, capricious, an abuse of discretion, and not in accordance with law. Six environmental groups filed a motion seeking to intervene on EPA’s behalf, as did nine states and the City of Chicago. North Dakota v. EPA, Nos. 16-1242 et al. (D.C. Cir. states’ and environmental groups’ motions to intervene Aug. 15, 2016): added to the “Challenges to Federal Action” slide.

Murray Energy Corporation and affiliated coal companies (Murray Energy) filed papers opposing EPA’s motion for summary judgment in Murray Energy’s action to compel EPA to undertake an evaluation of the impact of the Clean Air Act on employment. Murray Energy argued that EPA did not have discretion to ignore the duty to conduct such an evaluation and urged the court to reject EPA’s argument that it had fulfilled its obligation to conduct the employment evaluations. Murray Energy also disputed EPA’s claim that the plaintiffs lacked standing and asserted that the court had authority to issue an injunction to ensure compliance and to preserve the status quo pending compliance by enjoining enforcement activities and the approval of further regulations. The Chamber of Commerce of the United States of America and the National Mining Association submitted an amicus curiae brief in support of the plaintiffs, arguing that EPA had a mandatory duty to conduct the employment analysis and that Murray Energy had standing to challenge EPA’s failure to do so. Murray Energy Corp. v. McCarthy, No.5:14-cv-00039-JPB (N.D. W. Va. U.S. Chamber amicus brief Aug. 24, 2016; Murray Energy opposition to summary judgment Aug. 19, 2016): added to the “Challenges to Federal Action/Clean Air Act” slide.

EPA asked the federal district court for the District of Columbia to dismiss an action in which environmental groups sought to compel EPA to regulate aircraft carbon dioxide emissions. EPA argued that its issuance in July of a final endangerment finding for such emissions made the entire action moot. After EPA issued the final determination, the court ordered the environmental groups to show cause why the action should not be dismissed. The environmental groups concurred that the portion of their lawsuit seeking a final endangerment finding was moot (and the court subsequently dismissed that count), but the groups argued that EPA’s ongoing failure to set emissions standards constituted unreasonable delay. In support of its motion to dismiss, EPA argued that the groups could not make an unreasonable delay claim because EPA had no obligation to take action at the time the groups filed the action; only EPA’s issuance of the final endangerment finding triggered any duty. Briefing on the motion to dismiss was scheduled to be completed on September 23. Center for Biological Diversity v. EPA, No. 1:16-cv-00681 (D.D.C. motion to dismiss Aug. 19, 2016; plaintiffs’ response to court’s order Aug. 5, 2016; order July 27, 2016): added to the “Force Government to Act/Clean Air Act” slide.

Massachusetts Attorney General Asked Texas Federal Court to Dismiss ExxonMobil Challenge to Civil Investigative Demand

Massachusetts Attorney General Maura Healey filed a motion to dismiss Exxon Mobil Corporation’s (ExxonMobil’s) lawsuit against her in a Texas federal court. Healey argued that the federal district court for the Northern District of Texas was not the proper forum for ExxonMobil’s action, which sought to bar enforcement of a civil investigative demand (CID) issued by Healey in connection with her office’s investigation into unfair or deceptive acts or practices in trade or commerce with respect to fossil fuel products and securities. Healey said the federal court did not have personal jurisdiction over her, that abstention was warranted, that the action was unripe, and that the venue was improper. Healey also opposed ExxonMobil’s motion for a preliminary injunction, stating that ExxonMobil had not demonstrated that it would suffer irreparable harm or that it was substantially likely to prevail on its constitutional claims. Healey also argued that a preliminary injunction would undermine Massachusetts’ investigatory powers and harm the state’s consumers and investors and the public interest. In reply, ExxonMobil reiterated its arguments that the CID violated the First, Fourth, and Fourteenth Amendments of the Constitution, as well as the dormant Commerce Clause, and argued that a violation of constitutional rights constituted irreparable harm and that the public had an interest in ensuring that law enforcement powers were executed constitutionally. Eighteen states, the District of Columbia, and the Virgin Islands submitted an amicus curiae brief supporting Healey. They argued that Exxon could not ask a federal court to impede a state attorney general’s investigation where a process for challenging the subpoena was available in state court. Exxon Mobil Corp. v. Healey, No. 4:16-cv-00469-K (N.D. Tex. ExxonMobil reply Aug. 24, 2016; states’ amicus brief Aug. 17, 2016; motion to dismiss and opposition to preliminary injunction Aug. 8, 2016): added to the “Regulation of Private Conduct” slide.

Competitive Enterprise Institute Asked New York Court to Order Attorney General to Produce Climate Change Common Interest Agreements

Competitive Enterprise Institute (CEI) filed a proceeding in New York State Supreme Court under the New York Freedom of Information Law (FOIL) seeking to compel the New York Attorney General (NYAG) to produce documents in response to CEI’s request for common interest agreements entered into by the NYAG during a specified period in 2016. CEI said it believed that the NYAG had shared information, consulted, and communicated with private parties and other attorneys general regarding climate change policies and possible investigation of entities opposed to climate policies. CEI’s FOIL request came after ExxonMobil confirmed in November 2015 that it had received a subpoena from the NYAG and after the NYAG participated in a press conference in March 2016 with other state attorneys general to announce a coalition to pursue climate change-related initiatives. The NYAG denied CEI’s FOIL request, asserting that the records were exempt from disclosure because they were shielded by attorney-client privilege and the work product doctrine, were compiled for law enforcement purposes, and were inter-agency or intra-agency materials. Competitive Enterprise Institute v. Attorney General of New York, No. 05050-16 (N.Y. Sup. Ct., filed Aug. 31, 2016): added to the “Force Government to Act/Other Statutes” slide.

Groups Sought Climate Emails from Rhode Island Attorney General

Free Market Environmental Law Clinic and Energy & Environment Legal Institute filed an action in Rhode Island Superior Court under the Access to Public Records Act seeking disclosure by the Rhode Island Department of the Attorney General of certain emails between a person in the Department and the New York State Attorney General’s office. The plaintiffs also sought the employee’s emails containing the terms RICO, climate denial, climate denier, climate risk, or Gore. The plaintiffs contended that none of the documents they sought were properly exempted from disclosure. Free Market Environmental Law Clinic v. Rhode Island Department of the Attorney General, No. __ (R.I. Super. Ct., filed July 27, 2016): added to the “Force Government to Act/Other Statutes” slide.

Groups Said New York Attorney General Improperly Refused to Disclose Climate Correspondence

Free Market Environmental Law Clinic and Energy & Environment Legal Institute filed a proceeding in New York Supreme Court seeking documents from the Office of the New York Attorney General (NYAG) under FOIL. The petitioners said that they sought the correspondence of the attorney general with eight individuals—six private parties, an NYAG employee, and the California attorney general. The groups said the requested correspondence “contained certain keywords relating to the Attorney General’s recent decision to investigate those who disagree with him on climate change and climate change policies.” The NYAG denied the groups’ FOIL request, citing FOIL exemptions for documents subject to attorney-client privilege and the work product doctrine and for intra-agency and inter-agency documents. In their lawsuit, the groups contended that NYAG did not have a reasonable basis for withholding the documents. Energy & Environment Legal Institute v. Attorney General of New York, No. 101181/2016 (N.Y. Sup. Ct., filed July 25, 2016): added to the “Force Government to Act/Other Statutes” slide.

Sierra Club Said Virginia Should Have Considered Solar Component, Fugitive Pipeline Emissions in Natural Gas Plant Air Permit

The Virginia Chapter of the Sierra Club (Sierra Club) filed a proceeding in Virginia Circuit Court challenging a Prevention of Significant Deterioration (PSD) permit issued for a combined-cycle natural gas-fired power plant. Sierra Club’s arguments included an assertion that the PSD permit was required to address emissions—including fugitive greenhouse gas emissions—associated with the pipeline that would deliver fuel to the power plant. Sierra Club also asserted that the Virginia State Air Pollution Control Board failed to conduct a proper best available control technology (BACT) analysis because the BACT analysis should have considered a solar-powered auxiliary component as an available control technology for reducing greenhouse gas and other air emissions. Virginia Chapter of the Sierra Club v. Virginia State Air Pollution Control Board, No. __ (Va. Cir. Ct., filed Aug. 16, 2016): added to the “Stop Government Action/Project Challenges” slide.

August 2016 update (#89)

FEATURED CASE

Pennsylvania Commonwealth Court Said Environmental Rights Amendment Did Not Obligate Officials and Agencies to Regulate Greenhouse Gases

The Pennsylvania Commonwealth Court dismissed a proceeding in which petitioners sought to compel the Pennsylvania Public Utility Commission, the Pennsylvania governor, and other officials and entities in the executive branch to develop and implement a comprehensive plan to regulate greenhouse gases. The petitioners unsuccessfully alleged that the Environmental Rights Amendment of the Pennsylvania Constitution obligated the respondents to undertake such actions. The court concluded that it did have subject matter jurisdiction and that plaintiffs had standing, but concluded that it could not issue a writ of mandamus compelling the respondents to take the actions sought by the petitioners because the petitioners did not have a “clear right” to have the respondents conduct studies, promulgate or implement regulations, or issue executive orders regarding greenhouse gases. The court also declined to grant declaratory relief because doing so would have no practical effect. Funk v. Wolf, No. 467 M.D. 2015 (Pa. Commw. Ct. July 26, 2016): added to the “Common Law Claims” slide.

DECISIONS AND SETTLEMENTS

The D.C. Circuit Court of Appeals upheld the Federal Energy Regulatory Commission’s (FERC’s) environmental review for the conversion of the Cove Point liquefied natural gas (LNG) facility in Maryland from an import terminal to a facility that could both import and export LNG. Citing its June 28 decision in Sierra Club v. FERC, No. 14-1275, which concerned FERC authorizations for an LNG export terminal in Texas, the D.C. Circuit reiterated that FERC was not required to consider the indirect effects, including climate impacts, of increased natural gas exports through facilities authorized by FERC. The D.C. Circuit said that the Department of Energy alone had legal authority to authorize increased export of LNG and that FERC’s actions therefore were not the “legally relevant cause” for such effects. The D.C. Circuit said that while its earlier decision and a companion decision regarding a Louisiana LNG facility did not address emissions from the transport and consumption of exported gas, FERC authorizations were also not the cause of such effects. The D.C. Circuit noted that petitioners remained free to raise these issues in a challenge to the DOE’s authorization for the export of LNG from the Cove Point facility. (In June, a petitioner in this case, Sierra Club, filed a petition for review of DOE’s export authorization (Sierra Club v. Department of Energy, No. 16-1186 (D.C. Cir.).) The D.C. Circuit also found that the petitioners had not supported their argument that FERC’s failure to use the federal social cost of carbon in its analysis of environmental impacts was unreasonable. EarthReports, Inc. v. Federal Energy Regulatory Commission, No. 15-1127 (D.C. Cir. July 15, 2016): added to the “Stop Government Action/NEPA” slide.

The federal district court for the Northern District of West Virginia continued to address discovery issues in the lawsuit brought by Murray Energy Corporation and subsidiaries (together, Murray Energy) alleging that the United States Environmental Protection Agency (EPA) failed to perform a mandated study of the Clean Air Act’s impact on employment. The trial had been scheduled to begin in July, but the court vacated the trial deadline and other deadlines in June and indicated that the deadlines would be rescheduled at a later date. On July 5, 2016 granted EPA’s request that it restrict access to the transcript for a hearing held on June 29 during which documents stamped confidential were discussed. Murray Energy had objected to EPA’s motion. On July 20, the court granted in part and denied in part a motion by Murray Energy to compel disclosure of certain documents. The court agreed with EPA that certain documents were protected by the deliberative process privilege, but directed that other documents be produced in whole or in part. The court also permitted Murray Energy to continue depositions of two EPA witnesses due to the late production of documents. A motion by EPA for summary judgment remained pending.Murray Energy Corp. v. McCarthy, No. 5:14-cv-00039-JPB (N.D. W. Va. order July 5, 2016; order July 20, 2016): added to the “Challenges to Federal Action” slide.

Environmental Group and Rhode Island Landfill Operators Settled Citizen Suit

After reaching a settlement, Conservation Law Foundation (CLF) and the owners and operators of the Central Landfill in Johnston, Rhode Island agreed to dismissal with prejudice of CLF’s citizen suit under the Clean Air Act. The stipulation of dismissal was entered by the federal district court for the District of Rhode Island on July 6, 2016. CLF had charged that pollutants emitted from the landfill “pose risks to human health, cause foul odors in areas surrounding the Landfill, and contribute to climate change,” and that the landfill was violating multiple provisions of the Clean Air Act. CLF said that the settlement agreement required the defendants to hire an engineering firm to perform an assessment and recommend projects that will enhance gas generation and the performance of the landfill gas collection system, and that the parties would evaluate the firm’s recommendations and undertake projects. CLF also reported that for the first time the Rhode Island Department of Environmental Management intended to issue a single Clean Air Act operating permit to govern the landfill. Conservation Law Foundation v. Broadrock Gas Services, LLC, No. 13-777 (D.R.I. July 6, 2016): added to the “Regulate Private Conduct” slide.

Montana Federal Court Dismissed Challenge to Oil and Gas Leases After Plaintiffs Reached Agreement with Federal Defendants

In a lawsuit brought by environmental groups to challenge authorizations for federal oil and gas lease sales in Montana, the federal district court for the District of Montana approved a stipulated agreement between federal defendants and environmental groups and dismissed the action. In the stipulated agreement, the federal defendants agreed to notify the plaintiffs and hold public comment periods when applications for permits to drill (APDs) were submitted on the leases. The federal defendants also agreed to consider requiring measures to account for and reduce natural gas emissions as conditions of approval of the APDs. The stipulated agreement also noted that the United States Bureau of Land Management was proposing to update its regulations to reduce the waste of natural gas from flaring, venting, and leaks from oil and gas production operations on public and Indian lands. It left open the possibility that the plaintiffs could seek attorney fees under the Equal Access to Justice Act. Four trade groups that had intervened in the lawsuit said they would not object to dismissal of the action, but that they believed the federal defendants would have prevailed on the National Environmental Policy Act claims and that the plaintiffs were not entitled to attorney fees. Montana Environmental Information Center v. United States Bureau of Land Management, No. 11-15-GF-SHE (D. Mont. order July 7, 2016; intervenors’ response June 24, 2016; stipulated agreement June 17, 2016): added to the “Stop Government Action/NEPA” slide.

California Appellate Court Affirmed Dismissal of Challenge to Crude Oil Transloading Facility as Time-Barred

The California Court of Appeal agreed with a trial court that a lawsuit challenging an authorization to convert a rail-to-truck ethanol transloading facility to a facility that could transload crude oil was time-barred. The petitioners alleged that the Bay Area Air Quality Management District (BAAQMD) had unlawfully evaded review under the California Environmental Quality Act (CEQA) when it authorized the conversion, and argued that the discovery rule should apply to extend the time in which they could initiate their lawsuit because BAAQMD had not given public notice of its action. The petitioners asserted that the facility’s conversion could have significant adverse environmental impacts, including significant increases in greenhouse gas emissions. The Court of Appeal concluded that under the relevant statute, the petitioners were deemed to have constructive notice of BAAQMD’s authorization and that the discovery rule did not apply where there was constructive notice. Communities for a Better Environment v. Bay Area Air Quality Management District, No. A143634 (Cal. Ct. App. July 19, 2016): added to the “State NEPAs” slide.

California Court of Appeal Upheld Environmental Review for Downtown Fresno Project

The California Court of Appeal declined to overturn approvals for the reconstruction of the Fulton Mall area in downtown Fresno. The appellate court found that the City of Fresno had not prematurely approved the project in advance of its CEQA review. The court also found that the CEQA review was legally adequate, including its assessment of the project’s greenhouse gas emissions. The court noted that the City had presented an “extensive rationale” for its determination in its initial study that impacts on greenhouse gas emissions would not be significant and that the City therefore had no legal obligation to do more than “succinctly discuss” such impacts in the environmental impact report. Downtown Fresno Coalition v. City of Fresno, No. F070845 (Cal. Ct. App. July 14, 2016): added to the “State NEPAs” slide.

California Court of Appeal Set Course for New Review of Newhall Ranch

On remand from the California Supreme Court’s decision finding that the California Department of Fish and Wildlife had not supported its conclusion that the 12,000-acre Newhall Ranch development’s greenhouse gas emissions would not have significant impacts, the California Court of Appeal issued an opinion directing the trial court to take certain actions to direct the course of future environmental review of the project. The appellate court directed the trial court to find that the Department could use State greenhouse gas emissions reduction goals as a significance criterion and could use a hypothetical business-as-usual scenario to evaluate greenhouse gas impacts. The appellate court affirmed the trial court’s original finding that there was no substantial evidence that the development’s greenhouse gas emissions would not result in a cumulatively significant environmental impact. The appellate rejected the developer’s argument that it should retain jurisdiction and supervise completion of the environmental review. Center for Biological Diversity v. Department of Fish and Wildlife, No. B245131 (Cal. Ct. App. July 11, 2016): added to the “State NEPAs” slide.

California Court of Appeal Upheld Bay Area Sustainable Communities Strategy’s Reliance on Emission Reductions Beyond Statewide Mandates

The California Court of Appeal upheld “Plan Bay Area,” a regional transportation plan update and “sustainable communities strategy” adopted by Bay Area regional planning agencies to meet greenhouse gas emission reduction targets set by the California Air Resources Board (CARB) pursuant to the Sustainable Communities and Climate Protection Act of 2008 (SB 375). Plan Bay Area was challenged by petitioners who contended that Plan Bay Area should have relied on emission reductions from statewide mandates to achieve the SB 375 targets to avoid “draconian” land use and transportation measures. The Court of Appeal found that the “only legally tenable interpretation” of SB 375 was that it required its targets to be met using regional land use and transportation strategies that achieved emission reductions independent of reductions achieved by statewide mandates. The Court of Appeal further concluded that CARB had discretion to require that the SB 375 emission reductions be in addition to those stemming from statewide standards. The Court of Appeal also found that the agencies had complied with the California Environmental Quality Act (CEQA) regardless of SB 375 and CARB requirements. Bay Area Citizens v. Association of Bay Area Governments, No. A143058 (Cal. Ct. App. June 30, 2016): added to the “State NEPAs” slide.

A California Superior Court rejected challenges to the environmental review and approvals for a mixed-use development in San Francisco that featured a new arena for the Golden State Warriors. Among the arguments rejected by the court was a contention that a quantitative analysis of greenhouse gas emissions was required. The court noted that the lead agency had appropriately evaluated the project based on a local greenhouse gas strategy. The court also said that the California Environmental Quality Act (CEQA) did not require that project components considered in the greenhouse gas analysis be treated as mitigation measures. In response to the petitioners’ challenge to the project’s acquisition of greenhouse gas emissions offsets, the court noted that the project sponsor had agreed to obtain the offsets (in order to be certified as an “Environmental Leadership Development Project,” in addition to complying with the local greenhouse gas strategy and that the commitment to purchase the offsets was further evidence that the project’s greenhouse gas emissions were not significant. On July 25, 2016, the petitioners filed a notice of appeal. Mission Bay Alliance v. Office of Community Investment and Infrastructure, Nos. CPF-16-514892, CPF-16-514811 (Cal. Super. Ct. July 18, 2016; notice of appeal July 25, 2016): added to the “State NEPAs” slide.

NEW CASES, MOTIONS, AND NOTICES

North Dakota filed a petition in the D.C. Circuit Court of Appeals for review of EPA’s final rule establishing methane emission standards for new, reconstructed, and modified sources in the oil and natural gas sector. North Dakota asserted that the rule exceeded EPA’s statutory authority, was unconstitutional, and was arbitrary, capricious, an abuse of discretion, and not in accordance with law. North Dakota v. EPA, No. 16-1242 (D.C. Cir., filed July 15, 2016): added to the “Challenges to Federal Action” slide.

Environmental Groups Challenged FERC’s Approval of PJM Capacity Market Rules

Natural Resources Defense Council, Sierra Club, and Union of Concerned Scientists  challenged two orders issued by FERC approving PJM Interconnection L.L.C.’s (PJM’s) proposed changes to its Reliability Pricing Model, also referred to as its capacity market rules. PJM is the grid operator for 13 states and the District of Columbia, and the Reliability Pricing Model rules dictate how PJM will secure power resources to meet power demands. In the press release announcing the lawsuit, the organizations said that the rule changes approved by FERC “would impose significant costs on customers and severely handicap clean energy participation in PJM’s capacity markets.” Natural Resources Defense Council v. Federal Energy Regulatory Commission, No. 16-1236 (D.C. Cir., filed July 8, 2016): added to the “Stop Government Action/Other Statutes” slide.

Plaintiffs Who Successfully Challenged Minnesota Low-Carbon Power Law Sought Attorney Fees for Appeal; Minnesota Said It Would Ask Supreme Court for Review

After the Eighth Circuit Court of Appeals ruled that Minnesota’s low-carbon power law was unlawful, North Dakota and its co-plaintiffs asked the Eighth Circuit to remand the case to the federal district court for the District of Minnesota for a determination on their motion for attorney fees. The district court previously concluded that the plaintiffs were entitled to attorney fees under 42 U.S.C. § 1988, and the plaintiffs argued that they were also entitled to attorney fees and costs incurred during the appeal. The plaintiffs asserted that they had obtained all the relief they sought and prevailed in a case that asserted a substantial claim under 42 U.S.C. § 1983 (based on the dormant Commerce Clause), that they had succeeded on their Section 1983 claim (even though the Eighth Circuit “proffered additional rationales for affirmance” based on preemption and only one judge based affirmance on the dormant Commerce Clause), and that they had succeeded on other claims (i.e., the preemption claims) that arose from the same nucleus of operative fact. On July 22, Law360 reported that Minnesota had decide to file a petition for writ of certiorari with the United States Supreme Court rather than seeking en banc rehearing from the Eighth Circuit. North Dakota v. Heydinger, Nos. 14-2156, 14-2251 (8th Cir. June 29, 2016): added to the “Challenges to State Action” slide.

Los Angeles County and the People of California, acting through the Los Angeles County Counsel, commenced a lawsuit against Southern California Gas Company (SoCalGas) to compel SoCalGas to install subsurface safety shut-off valves on the active gas wells and distribution pipelines it owns and operates in the county. Those facilities include wells in the Aliso Canyon gas storage field where the largest gas leak in U.S. history occurred over the course 112 days beginning in October 2015. The plaintiffs also sought civil penalties, response costs, punitive and exemplary damages, and attorney fees. The plaintiffs asserted causes of action for public nuisance, unfair competition, and breaches of a franchise agreement and a lease agreement, and for damages under the County Code. The complaint alleged that the methane released during the Aliso Canyon leak would exacerbate the impacts of climate change and affect the health and well-being of the County’s citizens, even after the leak ended. The complaint also asserted that the four-month leak contributed roughly the same amount of warming as the greenhouse gas emissions produced by the entire country of Lebanon.California v. Southern California Gas Co., No. BC628120 (Cal. Super. Ct., filed July 25, 2016): added to the “Regulate Private Conduct” slide.

Washington Department of Ecology Said It Would Appeal Order Requiring Final Greenhouse Gas Rule by End of Year

On June 15, 2016, the Washington Department of Ecology (Ecology) filed a notice of appeal in Washington Superior Court in a lawsuit brought by children to compel the State to take action to reduce greenhouse gas emissions. The filing came a month after the court issued an order requiring Ecology to issue a final rule setting limits on greenhouse gas emissions by the end of 2016. Ecology released a draft of the rule on June 1, but Our Children’s Trust, an organization that represents the children in the lawsuit, said that the proposed rule “defie[d]” the court’s order because it was based on outdated emissions data and would not require emission reductions sufficient to place the state “on a path toward climate stability.” Foster v. Washington Department of Ecology, No. 14-2-25295-1 (Wash. Super. Ct. order May 16, 2016; notice of appeal June 15, 2016): added to the “Common Law Claims” slide.

Environmental Group Asked Interior for Moratorium on Leasing Public Land Fossil Fuels

On July 12, 2016, the Center for Biological Diversity (CBD) filed a petition with the United States Department of the Interior asking it to impose a moratorium on the leasing of federal public land fossil fuels under the Mineral Leasing Act. CBD said that the moratorium should be put in place immediately and that it should remain in effect until a comprehensive review of all federal fossil fuel leasing programs was completed and policies were developed to ensure that future leasing would be consistent with the United States’ goals of holding global warming “well below 2°C above pre-industrial levels” and pursuing efforts to “limit the temperature increase to 1.5°C above pre-industrial levels.” Center for Biological Diversity, Petition for a Moratorium on the Leasing of Federal Public Land Fossil Fuels Under the Mineral Leasing Act, 30 U.S.C. §§ 226, 241 (July 12, 2016): added to the “Force Government to Act/Other Statutes” slide.

Additions to the Non-U.S. Climate Litigation Chart:

Canadian Appeals Court Rejects Argument That Diesel Fuels Policy Is Invalid Because It Does Not Serve Its Stated Purpose of Climate Change Mitigation

In 2011, Syncrude Canada requested independent review of the regulation that requires two percent of the content of all its diesel fuels to be renewable, even what it produces for its own use. Syncrude took the case to court when Environment Canada and Climate Change Canada rejected that request, arguing that the regulation was invalid on various administrative and constitutional grounds. The court denied the challenge, finding that the regulations were a valid exercise of government authority as part of an overall strategy to reduce greenhouse gas emissions. After hearing Syncrude’s appeal, the appellate court characterized its key argument as follows:

Syncrude was asking the Court to substitute its view for that of the [government] as to whether the [renewable fuel requirement]s could, in the language of [Canadian Environmental Policy Act] subsection 140(2), “make a significant contribution to the prevention of, or reduction in, air pollution.”

The Court of Appeal rejected this argument, concluding not only that the government’s premise is warranted but furthermore that, “[e]ven if there was a solid evidentiary foundation establishing a different scientific opinion . . . it would not detract from the [government] forming a different opinion on admittedly different evidence.” Syncrude Canada Ltd. v. Attorney General of Canada, Federal Court of Appeal, No. A-383-14, 5/30/16.