By Margaret Barry and Hillary Aidun
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@gmail.com.
HERE ARE THE ADDITIONS TO THE CLIMATE CASE CHART SINCE UPDATE # 129.
FEATURED CASE
Trial Court Ruled for Exxon in New York’s Climate Change Securities Fraud Case
After a 12-day trial, a New York court found that the New York Office of the Attorney General failed to establish by a preponderance of the evidence that Exxon Mobil Corporation (Exxon) made any material misstatements or omissions that misled any reasonable investor about its practices or procedures for accounting for climate risk. The court therefore denied claims asserted under the Martin Act—New York’s securities fraud statute—and Executive Law § 63(12), which prohibits repeated or persistent fraudulent acts. Although the court granted the attorney general’s request to discontinue its common law and equitable fraud claims with prejudice, the court also said its decision established that Exxon would not have been held liable on any fraud-related claims since the attorney general failed to establish Exxon’s liability even for causes of action that did not require proof of the scienter and reliance elements of fraud. The court found that Exxon’s public disclosures in the 2013 to 2016 time period at issue in the case—including Form 10-K disclosures and March 2014 reports specifically addressing climate change risk and regulations that were prepared in consideration for withdrawal of shareholder proposals—were not misleading. The court said one of the March 2014 reports identified proxy costs of carbon and GHG costs as “distinct and separate metrics,” one of the factors leading the court to reject the premise of the attorney general’s case that Exxon’s disclosures “led the public to believe that its GHG cost assumptions for future projects had the same values assigned to its proxy cost of carbon.” The court also found that an analyst’s testimony undercut the attorney general’s assertion that information in the March 2014 reports was material to investors and found the attorney general’s expert testimony on materiality to be unpersuasive, “flatly contradicted by the weight of the evidence,” and “fundamentally flawed.” People v. Exxon Mobil Corp., No. 452044/2018 (N.Y. Sup. Ct. Dec. 10, 2019).
DECISIONS AND SETTLEMENTS
D.C. Circuit Lifted Abeyance on Truck Trailer Manufacturers’ Challenge to Greenhouse Gas and Fuel Efficiency Standards
The D.C. Circuit Court of Appeals granted a motion by the Truck Trailer Manufacturers Association (TTMA) to lift the abeyance in TTMA’s case challenging the U.S. Environmental Protection Agency (EPA) and National Highway Traffic Safety Administration’s (NHTSA’s) 2016 rule establishing greenhouse gas emissions and fuel efficiency standards for medium- and heavy-duty engines and vehicles. The schedule set by the D.C. Circuit requires final briefs to be filed by June 2, 2020. The court severed TTMA’s case from another case brought by the Racing Enthusiasts and Suppliers Coalition (RESC) challenging different aspects of the same rule. RESC’s case will continue to be held in abeyance. Both proceedings had been held in abeyance since 2017 while the agencies consider administrative requests for reconsideration. In October 2017, the D.C. Circuit granted TTMA’s motion to stay the EPA portion of the rule, which was scheduled to take effect in 2018. In its motion to lift the abeyance, TTMA said it could “no longer afford to wait” for judicial review because the NHTSA portion of the rule would take effect in January 2021 and any delay in resolution of the proceedings beyond mid-2020 “will begin to cause significant prejudice to TTMA’s members.” Truck Trailer Manufacturers Association, Inc. v. EPA, No. 16-1430 (D.C. Cir. Dec. 26, 2019).
D.C. Circuit Granted Rehearing on Due Process Issue in Atlantic Sunrise Pipeline Case
The D.C. Circuit granted a petition for rehearing en banc of its decision upholding authorizations for the Atlantic Sunrise Project, a natural gas pipeline expansion extending from Pennsylvania to Alabama. The court directed the parties to address due process issues addressed in the opinion, including whether the Natural Gas Act authorizes the Federal Energy Regulatory Commission (FERC) to issue tolling orders that extend the statutory 30-day period for FERC action on an application for rehearing. The court’s rehearing order did not mention the National Environmental Policy Act claims on which the court ruled in FERC’s favor, including claims regarding inadequate consideration of downstream greenhouse gas emissions. Allegheny Defense Project v. Federal Energy Regulatory Commission, No. 17-1098 (D.C. Cir. Dec. 5, 2019).
Federal Court Dismissed Challenge to “Two for One” Executive Order
The federal district court for the District of Columbia ruled that the plaintiffs challenging President Trump’s “two for one” executive order had not established standing. The executive order was issued in January 2017 and directed, among other things, that federal agencies identify at least two existing regulations to be repealed for every new regulation promulgated and offset any new incremental cost of a new regulation by eliminating costs associated with at least two prior regulations. The district court—which previously allowed limited discovery to address deficiencies in the plaintiffs’ standing allegations—found that the plaintiffs had not demonstrated that either the executive order itself or related guidance issued by the Office of Management and Budget caused the delay in the finalizing of two regulations identified by the plaintiffs: a federal motor vehicle safety standard for vehicle-to-vehicle accident avoidance communications and an energy efficiency standard for commercial water heating equipment. The court cited interrogatory responses of federal officials that supplied reasons for the delays and said the plaintiffs failed to point to evidence to contradict these responses. The court also rejected the plaintiffs’ contention that they should be found to have standing because the executive order was certain to increase delay in the future. Public Citizen, Inc. v. Trump, No. 17-cv-253 (D.D.C. Dec. 20, 2019).
Federal Court Denied Stay Pending EPA’s Appeal of Order Declining to Give EPA More Time to Implement Landfill Emission Guidelines
On December 17, 2019, the federal district court for the Northern District of California declined to stay its November 2019 order that denied EPA’s motion for relief from the court’s May 2019 order setting a schedule for EPA to implement landfill emission guidelines promulgated in 2016. EPA immediately applied to the Ninth Circuit for a stay pending appeal. EPA sought relief from the May 2019 order after it amended the regulations in August 2019 to change the deadlines for states to submit their implementation plans and to alter the timeframe for issuance of a federal plan. The court found that EPA had amended the regulations only to reset its non-discretionary deadline, not to rectify any violation identified by the court, and that enforcement of its original order was still equitable. In its December order denying a stay pending appeal, the court found that EPA’s appeal raised “serious legal questions” but that the balance of hardships did not tip sharply in EPA’s favor. California v. EPA, No. 4:18-cv-03237 (N.D. Cal. Dec. 17, 2019), No. 19-17480 (9th Cir. motion for stayDec. 17, 2019).
Colorado Federal Court Let Authorizations for Oil and Gas Development Remain in Place While Agencies Conducted Analysis of Indirect Impacts
The federal district court for the District of Colorado declined to vacate federal actions authorizing oil and gas development in the Bull Mountain Unit in the Colorado River basin. The court—which in March 2019 found that the federal agencies erred in failing to consider the foreseeable indirect effects resulting from combustion of oil and gas—said vacatur was not warranted because the defendants prevailed on all but one of the eight issues raised by the plaintiffs and vacatur “would undoubtedly be somewhat disruptive” to intervenor-defendants who had spent 10 years in the approval process for proposed oil and gas operations. The court instead remanded to the federal defendants for further analysis and suspended approved Applications for Permits to Drill (APDs) and barred approval of additional APDs pending completion of the analysis. Citizens for a Healthy Community v. U.S. Bureau of Land Management, No. 1:17-cv-02519 (D. Colo. Dec. 10, 2019).
Minnesota Court Said Minnesota Environmental Protection Act Applied to Agreements for Construction of Power Plant in Wisconsin
The Minnesota Court of Appeals found that the Minnesota Public Utilities Commission had erred by approving “affiliated-interest agreements” associated with construction and operation of the Nemadji Trail Energy Center (NTEC)—a proposed 525 megawatt natural gas power plant in Wisconsin—without complying with the Minnesota Environmental Policy Act (MEPA). The court concluded that MEPA applied to affiliated-interest agreements and that the Commission had jurisdiction to order the preparation of an environmental assessment worksheet (EAW) under MEPA for a project in another state to determine whether an environmental impact statement should be prepared. The court noted that the affiliated-interest agreements contemplated a utility’s undertaking of the physical activities of constructing and operating NTEC, which the court described as “definite, site-specific actions that will affect not only the plant’s immediate location but also its surrounding environment, most notably through the large quantities of carbon dioxide that the plant will emit.” The court said “[t]he impact of such emissions on air quality is precisely the type of environmental effect that MEPA addresses.” The court directed the Commission to determine whether NTEC might have significant environmental effects, and if so, to prepare an EAW before reassessing whether to approve the agreements. Minnesota Center for Environmental Advocacy v. Minnesota Public Utilities Commission, No. A19-0688, A19-0704 (Minn. Ct. App. Dec. 23, 2019).
Hawaii Court Put Flood Management Project on Hold
On October 29, 2019, a Hawaii state court reportedly issued a decision barring the State from funding a flood management project along the Ala Wai Canal until an environmental impact statement is accepted. CityLab reported that the project had been initiated to protect Waikīkī and other communities from flood events, the threat of which is exacerbated by sea level rise. Opponents of the project have raised concerns about the project’s ecological and visual impacts. Protect Our Ala Wai Watersheds v. Miyahira, No. 1CC191001480 (Haw. Cir. Ct., filed Sept. 18, 2019).
Appellate Court Upheld All but One of California Coastal Commission’s Conditions for New Home on Oceanside Bluff
Reversing a trial court, the California Court of Appeal held in September that the California Coastal Commission had not abused its discretion by requiring that a new residence on an oceanside bluff be set back 60 to 62 feet from the edge of the bluff rather than the 40 feet approved by the City of Encinitas. The Commission’s required setback was based in part on the use of a higher erosion rate—due to expected sea level rise—than what was predicted in the owner’s geotechnical report. The appellate court also upheld the Commission’s authority to impose a condition barring the homeowners from constructing a bluff or shoreline protective device to protect the new home and found that this condition was not an unconstitutional taking. In addition, the court upheld a requirement that the homeowners obtain and follow recommendations of a geotechnical report, including removal of the threatened portion of a structure, if the bluff eroded to within 10 feet of the principal residence. The appellate court concluded, however, that a condition requiring the owners to remove the residence if a government agency ordered that the structure not be occupied was overbroad and unreasonable as drafted. The owners had expressed concerns that any government entity “could order the house ‘not to be occupied’ without any justification, or with unsupported claims about the impact of projected sea-level rise and future erosion of the bluff.” Lindstrom v. California Coastal Commission, No. D074132 (Cal. Ct. App. Sept. 19, 2019).
NEW CASES, MOTIONS, AND NOTICES
Briefing Continued in Fossil Fuel Companies’ Appeals of Remand Orders in First and Tenth Circuits; Fourth Circuit Heard Oral Argument in Baltimore’s Case
On December 26, 2019, the State of Rhode Island filed its brief in support of the affirmance of the federal district court order remanding to state court its action seeking relief from fossil fuel companies for climate change-related injuries. Rhode Island argued that it had the right to pursue its causes of action for public nuisance, strict liability and negligent failure to warn, strict liability and negligent design defect, trespass, impairment of public trust resources, and violations of Rhode Island’s Environmental Rights Act in state court. The State contended that the First Circuit only had jurisdiction to review whether federal-officer removal jurisdiction existed and further argued that, in any event, other grounds for removal had no merit.
On December 20, Boulder County, the City of Boulder, and San Miguel County filed their brief in the Tenth Circuit, also arguing that the appellate court could only review removal under the federal-officer removal statute, which they argued did not provide a basis for removal of their case. The plaintiffs-appellees also argued that the well-pleaded complaint rule governed removal under the general removal statute and that jurisdiction could not rest on unpled federal common law. In addition, the plaintiffs-appellees said their claims for relief did not necessarily depend on resolution of a substantial and disputed federal issue and that there was no complete preemption, federal enclave jurisdiction, or jurisdiction under the Outer Continental Shelf Lands Act.
Amicus briefs were filed in the First Circuit in support of affirmance of the remand orders. The amicus parties included “three of the nation’s leading local government associations,” which said state law tort claims “provide an important means for cities and local governments to seek abatement of and damages for localized harms arising from activities that cross jurisdictional boundaries.” The organizations argued that the district court’s decision remanding the case “stands in line with a consistent body of jurisprudence that has sustained the availability of state claims for complex cases.” Other amici in the First Circuit included 13 states that asserted “a unique interest in maintaining their state courts’ authority to develop and enforce requirements of state statutory and common law—including monetary remedies—in cases brought against commercial entities causing harm to and within their jurisdictions”; three senators, including both senators from Rhode Island, whose brief contended that courts as well as other branches of government needed to address climate change and urged scrutiny of arguments advanced by amicus party U.S. Chamber of Commerce regarding the merits and justiciability of the case due to the Chamber’s alleged efforts to “stifle” congressional and executive action on climate change; former U.S. diplomats and government officials who contended that corporate liability would not disrupt the U.S.’s international climate negotiations; the Center for Climate Integrity, the Union of Concerned Scientists, and “scholars and scientists with strong interests, education, and experience in the environment and the science of climate change,” who argued that the defendants had engaged in a “coordinated, multi-front effort” to discredit climate science that justified the local government claims; climate scientists whose brief was intended to provide the court with “an understanding of the relevant science and the unavoidable adaptation expenses” communities face; Natural Resources Defense Council, Inc., which argued that neither federal common law nor the Clean Air Act completely preempted Rhode Island’s claims; and Public Citizen, Inc., which cited its concern about removal jurisdiction due to its implications for state court authority “to provide remedies under state law for actions that threaten public health and safety.” Rhode Island v. Shell Oil Products Co., No. 19-1818 (1st Cir.)
Public Citizen, the local government associations, and NRDC also filed amicus motions in the Tenth Circuit in the defendants’ appeal of a District of Colorado order remanding the case brought by Boulder County, the City of Boulder, and San Miguel County. A 31-member coalition of local governments in Colorado also filed an amicus motion. The Tenth Circuit directed the defendants to file a response to the amicus motions by January 14. Board of County Commissioners of Boulder County v. Suncor Energy (U.S.A.), Inc., No. 19-1330 (10th Cir.).
On December 11, 2019, the Fourth Circuit heard oral argument in the appeal of the District of Maryland’s decision remanding Baltimore’s climate change case against fossil fuel companies. After the argument, the defendants submitted a letter and other documents in response to a question from the court regarding whether the federal government had exercised its right to extract petroleum form the Elk Hills Reserve. The defendants said that a 1976 law gave the Secretary of the Navy authority to sell or otherwise dispose of the U.S. share of the petroleum produced from such reserves and that the government had final authority over all production, which was carried out by defendant Chevron Corporation’s predecessor Standard Oil. The defendants also submitted a General Accounting Office report that indicated that Chevron and the government shared production, revenues, and expenses in proportion to their ownership shares. The plaintiffs responded that the court should disregard the defendants’ submission because it was an inappropriate attempt to supplement the evidentiary record and have the court make new factual findings. The plaintiffs further argued that the supplemental materials did not support federal-officer removal jurisdiction. Mayor & City Council of Baltimore v. BP p.l.c., No. 19-1644 (4th Cir.).
EPA, DOT, and Automakers Sought to Speed Up Challenge to Vehicle Emission Standard Preemption Actions; Challengers Asked D.C. Circuit to Put Proceedings on Hold
On December 18, 2019, the federal respondents in lawsuits in the D.C. Circuit challenging federal actions preempting state authority to set greenhouse gas vehicle emission standards and withdrawing California’s waiver for its greenhouse gas vehicle standards asked the D.C. Circuit to expedite briefing in the cases. The government said an expedited schedule was warranted due to the case’s potential impact on “the near-term decision-making of a significant sector of the economy” and on the vehicles that will be available to the public. On December 24, 2019, automaker groups that intervened on behalf of the defendants also moved to expedite briefing. The automaker groups asserted that “protracted litigation” would cause them to suffer irreparable injury and would drive up costs for both manufacturers and consumers. On December 26, 2019, both the State and Municipal Petitioners and the Public-Interest Petitioners moved to hold all of the consolidated cases in abeyance. The State and Municipal Petitioners asked the court to hold the cases in abeyance pending final action on pending administrative reconsideration petitions and resolution by the federal district court for the District of Columbia of cases addressing some of the same legal issues. The Public-Interest Petitioners sought abeyance for the duration of the district court proceedings and argued that judicial economy favored abeyance. They argued that the district court must hear the challenge to the National Highway Traffic Safety Administration (NHTSA) preemption rule first and that petitions for review of EPA’s revocation of the waiver was predicated on the preemption rule. Union of Concerned Scientists v. National Highway Traffic Safety Administration, Nos. 19-1230 et al. (D.C. Cir.).
In the district court cases challenging NHTSA’s preemption rule, the court granted the Coalition for Sustainable Automotive Regulation and Association of Global Automakers motion to intervene in support of the defendants and the motions of the National Coalition for Advanced Transportation and a group of utilities to intervene in support of the plaintiffs. The court also consolidated the three cases challenging the rule. California v. Chao, No. 19-cv-2826 (D.D.C.).
Massachusetts Asked Federal Court to Send Consumer Protection Action Against Exxon Back to State Court
On December 26, 2019, Massachusetts moved to remand its action against Exxon Mobil Corporation under the State’s consumer protection law back to state court. Massachusetts asserted that its complaint focused solely on alleged violations of the Massachusetts Consumer Protection Act and did not raise any federal claims. The attorney general argued that all of Exxon’s bases for removal were “implausible” and had no support in law or fact not only because the complaint alleged only violations of a single state law but also because the claims did not require the disposition of any federal issue, did not arise under federal common law, did not involve action by Exxon taken under the direction of a federal officer or agency, and did not constitute a “class action” under the Class Action Fairness Act. The attorney general also said the federal court should ignore Exxon’s allegations of conspiracy—which the attorney general characterized as “unsupported innuendo”—as a basis for removal and instead focus on the “four corners” of the complaint. Massachusetts v. Exxon Mobil Corp., No. 1:19-cv-12430 (D. Mass. Dec. 26, 2019).
Lawsuit Filed to Compel Corps of Engineers and Mississippi River Commission to Take Action to Mitigate Adverse Impacts of Spillway Releases on Coastal Communities
Three Mississippi cities, two counties, and two organizations representing the Mississippi lodging and tourism and commercial fishing industries filed a lawsuit in the federal district court for the Southern District of Mississippi asserting that the Mississippi River Commission and the U.S. Army Corps of Engineers unlawfully failed to consider impacts to coastal communities and natural resources when they opened the Bonnet Carré Spillway in the spring and summer of 2019. The plaintiffs alleged that the opening of the spillway released “a flood of polluted Mississippi River water through the Lake Pontchartrain Basin and into the Mississippi Sound, wreaking havoc on the natural resources, communities and businesses on the Mississippi Gulf Coast.” The plaintiffs also alleged that the “disastrous” opening of the spillway was “unlikely to be an isolated event,” noting that it had been opened six times since 2008 after having been opened only eight times in the first 70 years of its existence. The complaint said the increase in frequency and volume of the opening was driven by increased flooding and precipitation, and that “[t]his increased precipitation will continue as a consequence of warming temperatures.” The plaintiffs asserted that “absent development of mitigating strategies by the Corps and the Mississippi River Commission, the Bonnet Carré Spillway will continue to open on a basis that will cause ongoing damage to the public resources of coastal Mississippi.” The plaintiffs sought a declaration that the defendants were in violation of the National Environmental Policy Act and the Magnuson Stevens Fishery Conservation and Management Act and asked the court to order the defendants to fully comply with those statutes “with all due haste” and in the interim to require the Corps to consult with and obtain the consent of the plaintiffs and relevant Mississippi authorities regarding measures to avoid and minimize impacts prior to any opening of the spillway. A separate lawsuit asserting violations of the National Environmental Policy Act was filed by the Mississippi Secretary of State and Trustee of the Public Tidelands Trust. Harrison County v. Mississippi River Commission, No. 1:19-cv-00986 (S.D. Miss., filed Dec. 23, 2019); Hosemann v. U.S. Army Corps of Engineers, No. 1:19-cv-00989 (S.D. Miss., filed Dec. 30, 2019).
Montana Plaintiff Asked Federal Court to Require Energy Company to Include His Shareholder Proposal in Proxy Statement
A Montana man filed a lawsuit in the federal district court for the District of Montana to compel NorthWestern Corporation to include in its annual proxy statement his shareholder proposal requesting that the company cease coal-fired generation of electricity from the Colstrip power plant in Montana by 2025 and replace the electricity generated by the plant with non-carbon renewable energy. The plaintiff alleged that he is a shareholder in NorthWestern, the parent company of a company that operates an energy company that generates and transmits electricity to parts of Montana, South Dakota, and Nebraska. The plaintiff alleged that NorthWestern had told the Securities and Exchange Commission that it intended to omit the proposal on grounds that the plaintiff asserts are invalid. The plaintiff sought a declaration that his proposal qualified for inclusion in NorthWestern’s 2020 proxy statement and that NorthWestern had a legal duty to include it. Tosdal v. NorthWestern Corp., No. 9:19-cv-00205 (D. Mont., filed Dec. 23, 2019).
Plaintiffs Raised Climate Change Concerns in Challenge to Hog Slaughter Inspection Rule
A lawsuit challenging the U.S. Department of Agriculture’s (USDA’s) final rule establishing an optional new inspection system for hog slaughter establishments included a claim that the USDA violated the National Environmental Policy Act (NEPA) by determining that the rule was categorically excluded from NEPA review. The complaint—filed by seven nonprofit organizations in the federal district court for the Western District of New York—asserted that even if the general terms of the USDA’s categorical exclusion for the actions of the Food Safety and Inspection Service could cover the rule, “extraordinary circumstances” existed that required preparation of an environmental assessment or environmental impact statement. Those circumstances related to the significant adverse environmental effects that the plaintiffs alleged would result from the increase in pig demand and slaughter numbers that the USDA projected in its economic benefits analysis. The plaintiffs alleged that the potential environmental effects included “supply-level” effects, including increasing the risk of climate change due to increases in emissions of the greenhouse gases methane and nitrous oxide at concentrated animal feeding operations. Farm Sanctuary v. U.S. Department of Agriculture, No. 6:19-cv-06910 (W.D.N.Y., filed Dec. 18, 2019).
Plaintiffs Said Biological Opinions Failed to Fully Consider California Water Diversion Projects’ Impacts in Context of Climate Change
A lawsuit filed in the federal district court for the Northern District of California challenged biological opinions issued regarding the Central Valley and State Water Projects. The plaintiffs alleged that the water diversion projects “have caused devastating environmental impacts and have contributed to severe declines in California’s native fish species” and that “the biological opinions … were blatantly and improperly shaped by political motivations and authorize Water Project operations that will cause grave harm to species and their critical habitat, increasing the risk of extinction of endangered and threatened salmon, steelhead, and Delta Smelt.” Among the issues identified in the complaint was that the federal agencies allegedly failed to consider the full extent of the projects’ operations long-term impacts in the context of climate change. Pacific Coast Federation of Fishermen’s Associations v. Ross, No. 3:19-cv-07897 (N.D. Cal., filed Dec. 2, 2019).
Shareholder Derivative Suit Filed Against Exxon in New Jersey Federal Court for Allegedly Misleading on Climate Risks
The City of Birmingham Retirement and Relief System filed a stockholder derivative complaint in the federal district court for the District of New Jersey against Exxon Mobil Corporation officers and board members seeking damages for breaches of fiduciary duties, waste, and unjust enrichment. The complaint alleged that Exxon had for decades “misled shareholders about the material risks climate change posed and poses to its business in order to increase its short-term profits and falsely inflate its assets, revenues, and stock price.” City of Birmingham Retirement and Relief System v. Tillerson, No. 3:19-cv-20949 (D.N.J., filed Dec. 2, 2019).
Groups Challenged Corps’ NEPA Review for Methanol Marine Export Terminal in Washington
Five organizations filed a lawsuit in federal court in Washington challenging the U.S. Army Corps of Engineers’ issuance of a Section 404 permit for a marine export terminal on the Columbia River in Kalama, Washington. The terminal will serve a methanol manufacturing facility. The plaintiffs asserted, among other claims, that the Corps’ “truncated” NEPA review failed to fully consider the project’s greenhouse gas impacts. Columbia Riverkeeper v. U.S. Army Corps of Engineers, No. 3:19-cv-06071 (W.D. Wash., filed Nov. 12, 2019).
Lawsuit Charged California City with Failure to Adequately Consider Sea Level Rise in Environmental Review for Shoreline Residential Project
Two environmental groups filed a lawsuit in California Superior Court alleging that the City of Newark violated the California Environmental Quality Act when it approved a residential project along the shoreline of San Francisco Bay. The petitioners asserted that new information about the rate of sea level rise combined with more detailed information about the project’s design showed that impacts would be more severe than was disclosed in an environmental impact report prepared in 2015. The petition also claimed that the City did not consider the impact of sea level rise in combination with the project on available habitat for the endangered salt marsh harvest mouse and that the City had improperly deferred mitigation by relying on future adaptive management measures to mitigate impacts from sea level rise. Committee to Complete the Refuge v. City of Newark, No. RG19046938 (Cal. Super. Ct., filed Dec. 16, 2019).
HERE ARE RECENT ADDITIONs TO THE NON-U.S. CLIMATE LITIGATION CHART.
Dutch Supreme Court Ordered Government to Cut GHGs by 25% By End of 2020
A Dutch environmental group, the Urgenda Foundation, and 900 Dutch citizens sued the Dutch government to compel more ambitious action on climate change. In June 2015, the Hague District Court ordered the Dutch state to limit greenhouse emissions to 25% below 1990 levels by 2020, finding the government’s existing pledge to reduce emissions by 17% insufficient to meet the state’s fair contribution toward the UN goal of keeping global temperature increases within two degrees Celsius of pre-industrial conditions. In October 2018, the Hague Court of Appeal upheld the District Court’s ruling, concluding that by failing to reduce greenhouse gas emissions by at least 25% by 2020, the Dutch government contravened its duty of care under Articles 2 and 8 of the European Convention on Human Rights. The Dutch government appealed the decision, and the Supreme Court of the Netherlands heard the appeal on in May 2019. On September 13, 2019 the Advocate and Procurator General, independent judicial officers, issued a formal opinion recommending that the Supreme Court affirm the lower courts’ decisions. On December 20, 2019 the Supreme Court did so, ordering the Dutch Government to cut greenhouse gases by at least 25% by the end of 2020. Urgenda v. Netherlands HAZA C/09/00456689 (Dutch Court of Appeals).
Philippines Human Rights Commission Found Carbon Majors Can Be Liable for Climate Impacts
In May 2015, Greenpeace Southeast Asia and others filed a petition asking the Human Rights Commission of the Philippines to investigate a general issue—”the human rights implications of climate change and ocean acidification and the resulting rights violations in the Philippines”—and a more specific one—”whether the investor-owned Carbon Majors have breached their responsibilities to respect the rights of the Filipino people.” During a conference held on December 11, 2017, the Commission accepted the petition and confirmed that they would investigate the potential human rights violations stemming from major fossil fuel companies’ contributions to climate change. In March 2018, the Commission held its first public hearings to investigate the alleged responsibility of major fossil fuel companies or “carbon majors” for climate change and the potential impacts on the human rights of Filipinos.
On December 9, 2019, the Commission announced its finding that major fossil fuel companies could be held liable for climate change impacts. According to news reports, the Commission concluded that legal responsibility for climate damage is not covered by current international human rights law, but fossil fuel companies have a clear moral responsibility, and the onus falls on individual countries to pass strong legislation and establish legal liability in their courts. The Commission further found that that existing civil law in the Philippines provided grounds for action, and it may also be possible to hold companies criminally accountable “where they have been clearly proved to have engaged in acts of obstruction and willful obfuscation.” The Commission also concluded that major fossil fuel companies have an obligation to respect human rights as articulated by the United Nations Guiding Principles on Business and Human Rights. In re Greenpeace Southeast Asia and Others, Case No. CHR-NI-2016-0001 (Human Rights Commission of the Philippines).
UK Tribunal General Regulatory Chamber Affirmed EU ETS Requires Strict Accounting
An appellate regulatory body dismissed a claim that in seeking to recover over-allocated allowances under the European Union Emissions Trading Scheme (EU ETS), a UK regulator needed to “net off” other allowances to which the operator was entitled.
Appellant Repsol holds a greenhouse gas emissions permit under the EU ETS for an offshore oil-production, storage and offloading unit called Bleo Holm. Pursuant to the EU ETS, Repsol received a free allocation of allowances for the period 2012-2017 based on a historic baseline assessment of CO2 emissions from Bleo Holm, and was required to surrender sufficient allowances to cover its total emissions each year, whether the free allowances or additional allowances that had been purchased. Following an investigation, the Offshore Production Regulator for Environment and Decommissioning (OPRED) found that there had been a significant decrease in capacity at Bleo Holm and, as a result, determined that Repsol was not entitled to all of the free allowances that it had received. OPRED sought to recover the over-allocated allowances under the Greenhouse Gas Emissions Trading Scheme Regulations 2012 on behalf of the Secretary of State for Business, Energy and Industrial Strategy (BEIS). OPRED is still investigating another significant capacity reduction issue which may have resulted in an over-allocation of allowances to Repsol.
While the issues related to Repsol’s allowances for 2013-2017 were under review, in December 2018, the European Commission decided to suspend the allocation of free allowances to UK operators in light of the uncertainties surrounding the UK’s exit from the European Union. As a result, Repsol did not receive free allowances in 2018 as expected, and so the company had to purchase sufficient allowances to offset its emissions for that year.
In March 2019 Repsol appealed BEIS’s Notice of Recovery, bringing three claims before the Tribunal General Regulatory Chamber. First, Repsol contended that BEIS should not have sought to recover the total number of allowances that had been over-allocated for 2012-2017, but rather, should have netted off the allowances that Repsol did not receive in 2018 due to the European Commission’s decision to suspend the allocation of free allowances to UK operators. Second, Repsol argued that the European Commission’s decision to withhold allowances from UK operators was unlawful. Third, Repsol claimed that by seeking recovery of allowances without netting off the allowances to which Repsol was entitled, BEIS violated Repsol’s property rights under Article 1 of the First Protocol to the European Convention on Human Rights. Repsol asked the Tribunal to quash the Notice of Recovery.
On November 18, 2019, the Tribunal dismissed the appeal. According to the Tribunal’s order, the parties agree there was an over-allocation of allowances as a result of Repsol’s failure to notify BEIS of the decreased capacity at Bleo Holm, and so BEIS had the power to issue a Notice of Recovery. The Tribunal further explained that although a Notice of Recovery must provide certain information to an operator, this does not include the details of any calculation to determine the sum of allowances to which the operator is entitled. Therefore, the Tribunal reasoned, the sum of allowances does not include any netting-off calculation. Moreover, the 2012 regulations are intended to implement a strict accounting system. Given this, the Tribunal determined that BEIS did not err in declining to net off any allowances from the Notice of Recovery. The Tribunal further concluded that it lacked jurisdiction to re-interpret the European Commission’s decision to suspend allowance allocations to UK operators or to declare the decision unlawful. Finally, the Tribunal held that it lacked the power to resolve Repsol’s property rights claim. Repsol Sinopec Resources UK Ltd v. Secretary of State for Business, Energy and Industrial Strategy, [2019] 11 WLUK 533 (UK First-Tier Tribunal General Regulatory Chamber).
Judge Ruled Luxembourgish Minister of Social Security has No Legal Obligation to Align Pension Investments with Paris Agreement Goals
Greenpeace Luxembourg brought an action in administrative court against the Luxembourgish Minister of Social Security, Roman Schneider. Greenpeace claims that the Minister failed to respond to an August letter asking for information regarding how Luxembourg’s sovereign pension fund planned to align its investments with the objectives of the Paris Agreement, and information on the climate-related financial risks associated with the fund’s investments.
According to Greenpeace, an administrative judge ruled that the claim was admissible because Minister Schneider failed to comply with his legal obligation to respond to the letter, and the information sought was covered by the Law on Access to Environmental Information. However, the judge found no legal basis for requiring the Minister to comply with the Paris Agreement or to have the climate-related information that Greenpeace requested. Greenpeace Luxembourg v. Schneider (Luxembourg Administrative Court).
German Court Ruled Climate Policy is Judicially Reviewable, But Dismissed Action to Enforce Cabinet’s GHG Reduction Target
A German court has held that the German government’s climate policy is judicially reviewable and must not be so inadequate as to fail to protect fundamental rights such as the rights to life and property. However, the court dismissed an action by German families to challenge the government’s failure to adhere to a cabinet decision to reduce greenhouse gas emissions by 40% by 2020, concluding that the target was not legally enforceable.
In December 2014, the German cabinet set a goal of reducing national greenhouse gas emissions by 40% compared to 1990 levels by the end of 2020 (the Climate Protection Plan). According to the government’s 2018 official climate protection report, however, the government will likely only achieve a reduction of 32% from 1990 levels by the end of 2020. In October 2018, three German families and Greenpeace Germany filed suit in the Administrative Court of Berlin seeking to compel the German government to adhere to the 40% reduction goal. Plaintiffs argued that the government was bound by the Climate Protection Plan, and alleged that the government’s failure to adhere to the 40% target encroaches on their human rights in violation of the German Constitution—the Grundgesetz—under Article 2(2) (right to life and health), Article 12(1) (occupational freedom), and Article 14(1) (right to property). They further alleged that failure to meet the original 2020 goal violates Germany’s minimum obligations under the EU Effort Sharing Decision (406/2009/EC).
On October 31, 2019 the Administrative Court of Berlin dismissed the case, concluding that the 2020 target, as a cabinet decision, was not legally binding. The court further held that plaintiffs had not conclusively demonstrated that the government had violated its constitutional obligations by setting inadequate climate protection targets. However, the court did hold that the government’s climate policy is subject to judicial review and must be consistent with the government’s duties to protect fundamental rights under the German Constitution. The court also determined that the government must undertake measures to provide adequate and effective protection of the fundamental rights potentially affected by climate change, including the rights to life and property. Nonetheless, the court concluded that the government is entitled to wide discretion in deciding how to fulfill these obligations, so long as precautionary measures to protect fundamental rights not are wholly unsuitable or wholly inadequate. In the court’s view, the government’s current protection policy, which will lower emissions by 32% rather than 40% by the end of 2020, is within its discretion.
Moreover, the court noted that the EU is only aiming for a 40% reduction in greenhouse emissions by 2030 and has pledged a reduction of only 20% below 1990 levels by 2020. In this context, the court concluded that the German government’s reduction target of 32% by the end of 2020 does not appear to be completely inadequate. Family Farmers and Greenpeace Germany v. Germany, 00271/17/R /SP (Administrative Court of Berlin).
Groups Filed Complaint Against UK Company Alleging Breaches of OECD Guidelines for Multinational Enterprises During Fracking Permitting Process in Slovenia
A coalition of social and environmental groups filed a complaint alleging that a British company violated the Organization for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises in applying for a permit to expand a fracking operation in Slovenia.
The complaint was filed with the Slovenian National Contact Point for the OECD Guidelines (NCP) by Focus Association for Sustainable Development and 16 other nongovernmental organizations and civil initiatives. The complainants assert that the UK-based company Ascent Resources plc (Ascent Resources) violated the OECD Guidelines in applying for a permit to expand a fracking operation at a natural gas field near Petišovci, Slovenia. The complaint also implicates Ascent Resources’s subsidiary in Slovenia, Ascent Resources d.o.o., and its contractor, Geonergo, d.o.o.
The complaint asserts that Ascent Resources ran afoul of the OECD Guidelines by: failing to take adequate steps to consider and address the potential environmental impacts of fracking, including fracking’s contribution to the threat of runaway climate change; failing to work with a view to achieving sustainable development and take due account of the need to protect the environment; engaging in improper political involvement by organizing a lobby campaign to pressure the Slovenian Ministry of the Environment to complete the permitting process for the fracking expansion without complication; failing to undertake required due diligence by not ensuring that its subsidiary and contractor considered all the environmental and health risks of fracking; incentivizing its subsidiary and contractor to cause adverse environmental and health impacts through fracking; and improperly avoided engagement with relevant stakeholders including local anti-fracking groups. The complaint also faults Geonergo, Ascent Resources’s contractor, for seeking an exemption from the need to undertake an environmental impact assessment. The complainants argue that the NCP should view Ascent Resources’s activities in the context of international climate treaties given that fracking contributes to global climate change.
The complainants request that the Slovenian NCP bring their concerns to Ascent Resources and facilitate a dialogue aimed at ending the company’s fracking activities in Slovenia. They also call on the UK NCP to support the Slovenian NCP in handling the complaint. Should a mediated solution prove unattainable, the complainants ask that the NCP inform the Slovenian authorities of the alleged breaches of the OECD Guidelines and urge that the allegations be considered in the permitting process. Specific instance under the OECD Guidelines for Multinational Enterprises submitted to the Slovenian and UK National Contact Point for the OECD Guidelines (UK and Slovenia NCPs).
Friends of the Irish Environment Appealed Irish Court’s Rejection of Challenges to National Mitigation Plan
Friends of the Irish Environment (FIE) filed suit in Ireland’s High Court, arguing that the Irish government’s approval of the National Mitigation Plan in 2017 violated Ireland’s Climate Action and Low Carbon Development Act 2015 (the Act), the Constitution of Ireland, and obligations under the European Convention on Human Rights, particularly the right to life and the right to private and family life. FIE alleged that the National Mitigation Plan (“the Plan”), which seeks to transition to a low-carbon economy by 2050, is inconsistent with the Act and Ireland’s human rights commitments because it is not designed to achieve substantial short-term emissions reductions. On September 19, 2019, the Court ruled for the government. The Court rejected FEI’s claim that the Plan was invalid for failing to achieve substantial short-term emissions reductions, concluding that the Act does not require particular intermediate targets, reasoning that the government appropriately exercised policy making discretion afforded by the Act. The Court concluded that FEI had standing to bring rights-based claims, but rejected the argument that the government had violated Ireland’s Constitution and commitments under the European Convention on Human Rights because the Plan is “but one, albeit extremely important, piece of the jigsaw.” On November 22, 2019, FEI appealed the ruling to the Court of Appeal. FEI also submitted an application to leapfrog the traditional appeal route and go directly to the Supreme Court. Friends of the Irish Environment v. Ireland, 2017 No. 793 JR (High Court of Ireland).
Kids Sued Ontario, Alleged 2030 GHG Reduction Target Violates Human Rights
Seven youth brought suit alleging that Ontario violated the Canadian Charter of Rights and Freedom (“the Charter”) by abdicating its responsibility to address climate change.
Plaintiffs argue that Ontario has failed to meet the challenge of avoiding catastrophic climate change, which must be done within eleven years according to the scientific community. They further claim that Canada is not on track to meet the goals laid out in the Paris Agreement, in large part due to Ontario’s 2030 greenhouse gas reduction target of 30% below 2005 levels, set under the Cap and Trade Cancellation Act, 2018. In plaintiffs’ view, this target—which is less ambitious than previously adopted targets—is inadequate. Plaintiffs assert a genuine interest in preventing catastrophic climate change that poses pervasive and serious risks to the health and wellbeing of their generation and future generations of Ontarians. Their claims arise under sections 7 and 15 of the Charter, which provide the right to life, liberty and security of the person; and equal protection under the law, respectively.
Plaintiffs seek, among other things, a declaration that Ontario’s target violates the rights of Ontario youth and future generations under sections 7 and 15 of the Charter; a declaration that Ontario’s target violates an unwritten constitutional principle that governments may not engage in conduct that will, or unreasonably could be expected to, result in the future harm, suffering or death of a significant number of its own citizens; a declaration that section 7 of the Charter includes the right to a stable climate system, capable of providing youth and future generations with a sustainable future; a declaration that sections 3(1) and/or 16 of the Cap and Trade Cancellation Act, which repealed the Climate Change Mitigation and Low-carbon Economy Act, 2016, and allowed for the imposition of more lenient targets without mandating that they be set according to the Paris Agreement’s goals or any sort of science-based process, violates sections 7 and 15 of the Charter; an order that Ontario set a science-based greenhouse gas reduction target that is consistent with Ontario’s share of the minimum level of greenhouse gas reductions necessary to limit global warming to below 1.5 degrees Celsius or well below 2 degrees Celsius; and an order directing Ontario to revise is climate change plan once it has set such a target. Mathur, et al. v. Her Majesty the Queen in Right of Ontario, CV-19-00631627 (Ontario Superior Court of Justice).
ClientEarth Filed Complaint Alleging Energy Company’s New Ad Campaign is Misleading
The British environmental group ClientEarth has filed a complaint against BP p.l.c, alleging that the energy company’s current advertising misleads the public.
ClientEarth asserts that an advertising campaign launched in January 2019 under the titles “Keep Advancing” and “Possibilities Everywhere” is misleading in the way it presents BP’s low-carbon energy activities. The complaint alleges that the campaign runs afoul of the Organization for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises, which require clear, honest, accurate and informative communications between enterprises and the public. The complaint asserts that the advertising gives a false impression of the relative scale of renewable and low-carbon energy in BP’s business; misleadingly omits full lifecycle emissions for natural gas and claims an inaccurate emissions saving against coal combustion; and misleadingly asserts that increases in global primary energy demand are both desirable and inevitable for human progress and development.
ClientEarth filed the complaint against BP with the UK National Contact Point for the OECD Guidelines for Multinational Enterprises (UK NCP), an administrative body. The complaint asks BP to take certain steps to correct the allegedly misleading information, including by withdrawing specific advertisements and issuing a statement explaining the withdrawal. The complaint further asks that the UK NCP find BP in violation of the OECD Guidelines if BP does not take the requested steps. Complaint against BP in respect of violations of the OECD Guidelines (UK NCP).
