State and Local Climate Lawsuits are 4-1 at the Federal Circuit Courts

State and Local Climate Lawsuits are 4-1 at the Federal Circuit Courts

On May 23, 2022, the First Circuit upheld a decision from the  United States District Court for the District of Rhode Island to remand Rhode Island’s climate change lawsuit back to state court. This marks the fourth time a federal circuit court has upheld a decision remanding a government’s climate change lawsuit against fossil fuel companies, the other three being cases from Baltimore, MarylandSan Mateo County, California, and Boulder, Colorado. For the fossil fuel companies, this pattern is a stark string of losses, forcing the cases to remain in state courts in which the fossil fuel companies very decidedly do not want to litigate.

Five states and some sixteen local governments have filed lawsuits related to climate change against a plethora of fossil fuel defendants. In broad terms, the lawsuits seek to hold fossil fuel companies responsible for products liability claims: namely that the companies marketed and sold products that they knew would cause harm and failed to warn about the products’ risks. If the state and local plaintiffs prevail, the effect could devastate the fossil fuel industry. Indeed, if even one governmental plaintiff wins, other state and local governments will swiftly file similar lawsuits. After all, even less-progressive jurisdictions will have a hard time passing up the prospect of a likely win against deep-pocketed defendants. Understandably, then, the fossil fuel defendants have fought these cases tooth and nail.

Nearly all the state and local climate cases were filed in plaintiff-friendly state courts, and in each instance, the fossil fuel defendants have removed the cases to federal court. As the thinking goes, federal courts are more likely to be favorable to the fossil fuel defendants. In response, the state and local plaintiffs have moved to remand the cases back to state courts.

Esoteric issues of removal have thwarted litigative progress, however. Complicated questions about the federal officer removal statute even went up to the Supreme Court last term in BP P.L.C. v. Mayor and City Council of Baltimore. On narrow jurisdictional grounds, the Supreme Court sided with the fossil fuel defendants that the Fourth Circuit should have addressed all removal grounds when considering the motion for remand. At the time, the May 2021 opinion was heralded as a big win for the fossil fuel companies.

But comparatively little fanfare has sounded for the subsequent wins for plaintiffs across four circuit courts. Heeding the Supreme Court’s instruction in Baltimore to address all the grounds for removal, each circuit court has done so and found in favor of the state and local climate plaintiffs. First, in February of this year, the Tenth Circuit found that Boulder’s lawsuit was not completely preempted or displaced by federal common or statutory law. As it only raised state law claims, it belonged in state court. The Fourth and Ninth Circuits quickly followed in April, finding that the City of Baltimore and the County of San Mateo’s lawsuits, respectively, belonged in state court. Thus, the deck was stacked when the First Circuit held the same for Rhode Island’s lawsuit. In fact, the First Circuit noted that it was “leaning hard on our sibling circuits’ analyses in comparable climate-change cases[.]”

The one exception—and the one blemish on the state and local climate cases’ record of success—is New York City’s case. In April 2021, before the Supreme Court’s Baltimore decision, the Second Circuit held that “each of the City’s claims is barred” and that, therefore, the “complaint must be dismissed.” What accounts for the difference here? New York City filed its complaint in federal court in the first instance. Without a removal posture, the federal court was “free to consider the [defendants’] preemption defense on its own terms, not under the heightened standard unique to the removability inquiry.” As the First Circuit noted in Rhode Island’s case, this procedural difference was key.

Thus, the state and local climate cases, with one exception, live to fight another day in state courts. Moreover, they do so in forums that the fossil fuel defendants fought for over four years to avoid. While it is too early to proclaim victory for the plaintiffs, it is not too soon to acknowledge that the state and local plaintiffs have set themselves up very well, jurisdictionally-speaking.

The next steps depend on what the fossil fuel defendants do next. They could, conceivably, petition for certiorari in the First Circuit case, but the odds there are against the Supreme Court taking up the case, particularly with the lack of a genuine circuit split on the legal issues. In the other cases, the fossil fuel defendants are likely readying motions to dismiss on personal jurisdiction and failure to state a claim, but it seems unlikely that every defendant and every claim will be dismissed. Thus, at long last, the state and local climate cases will be heading towards discovery, although, of course, that will not be an end to the legal squabbles. Keep an eye on state courts in Rhode Island, Maryland, California, and Colorado to see what happens next.

Sean Lyness is a Faculty Fellow at New England Law Boston. He wishes to thank the staff of the Northwestern University Law Review Online for their excellent editing, especially Taylor Nchako and Adam Lefkowitz.

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