On October 16, the Fifth Circuit Court of Appeals revived a lawsuit filed by residents along the Mississippi Gulf coast against several corporations in the energy, fossil fuels, and chemicals industries alleging that the defendants were responsible for property damage caused by Hurricane Katrina — Comer v. Murphy Oil USA, et al., No. 07-60756 (5th Cir. Oct. 16, 2009). The Fifth Circuit’s opinion (explained below) comes on the heels of a Second Circuit Court opinion in New York allowing a number of states to proceed with a lawsuit against electric power generators that seeks judicially established caps on the generators’ greenhouse gas (GHG) emissions under federal common law nuisance and trespass theories. As a result, the plaintiffs’ bar is ramping up, and the defense bar is bracing for a blitz of climate change tort cases that could open a new front in the battle over climate change legislation and cost industry millions to defend.
Both the Fifth Circuit’s Comer decision and the Second Circuit’s decision in Connecticut v. Am. Elec. Power Co., Nos. 05-5104 and 05-5119 (2nd Cir. Sept. 21, 2009) dealt with the threshold issues of whether the plaintiffs had the right ("standing," in legal parlance) to bring their case in federal court and whether the court had the authority to hear the case under the "political question" doctrine, a legal theory by which a court will abstain from deciding issues best left to Congress and the executive branch. Of the two opinions, the Comer decision seems more likely to have an immediate impact on the power generation industry because it involved claims for compensatory relief by private individuals, and thus is more likely to spawn copycat suits than AEP, which was a suit by state governments.
The Issue of Standing
The Fifth Circuit found that plaintiffs established standing by alleging a series of scientific facts which, if true, fairly traced the damage caused by Hurricane Katrina to the GHGs emitted from defendants’ operations, even though their emissions were not the material cause of Hurricane Katrina but merely contributed to it. The Fifth Circuit noted that the Supreme Court had already embraced such a causal link in Massachusetts v. EPA, 549 U.S. 497 (2007), a decision permitting Massachusetts to challenge the Environmental Protection Agency’s decision not to regulate GHGs. The Fifth Circuit cited several passages from Massachusetts v. EPA in which the Supreme Court discussed a link between GHG emissions and rising ocean temperatures, increasingly ferocious hurricanes, and other environmental changes.
The Political Question Doctrine
The political question doctrine is primarily a function of the separation of powers; it does not mean that a court abstains from deciding politically charged cases but only abstains from those cases where a judicial decision would inappropriately interfere in the business of the other branches of government. Every district court considering the political question doctrine in this context has found that these cases would require balancing environmental, economic, foreign policy, and national security interests essentially beyond the purview of the courts.
Courts rely on Baker v. Carr, 369 U.S. 186 (1962), in which the Supreme Court announced six factors for analyzing a case under the political question doctrine, focused generally on whether there is a textually demonstrable constitutional commitment of the issue to another branch; whether judicial standards exist to resolve the question or the court must make an initial policy determination of a kind clearly for nonjudicial discretion; or whether the court’s decision would conflict with decisions by the other branches of government in areas such as foreign relations, war, and so forth.
In what may prove to be the most controversial part of its opinion, the Fifth Circuit wrote that the Baker factors were merely "interpretive guides" that a court could use if a party moving to dismiss under the "political question" doctrine identified a constitutional provision or federal law that arguably commits a material issue in the case exclusively to a political branch. Because defendants could not identify any federal law or provision of the Constitution that committed the issue of climate change to Congress or the executive branch, the Fifth Circuit held that plaintiffs’ claims were clearly justiciable. To bulletproof its decision, however, the Fifth Circuit devoted a rather cursory paragraph to the other Baker factors, reasoning that because the case before it involved only state law claims and a request for money damages, Mississippi’s tort rules would provide manageable standards with which to decide the case.
Resolution of the Comer and AEP cases through en banc rehearings (where all judges of a court, rather than just a panel of them, will hear a case) or successful certiorari (request for reexamination of the actions of a lower court) to the Supreme Court will take months or perhaps years. In the meantime, the Fifth Circuit’s reasoning, if embraced by other courts, could make it difficult for defendants to attack these suits on a motion to dismiss. The panel’s treatment of Massachusetts v. EPA could establish a template for pleading injury from GHG emissions that defendants will see repeated over and over again, and the Fifth Circuit’s interpretation of the "political question" doctrine could foreclose that defense strategy under the status quo (that is, in the absence of federal climate change legislation, which might change the analysis). Pass the sandbag.
—Tracy D. Hester (firstname.lastname@example.org) is a partner and Matthew J. Armstrong (email@example.com) is an associate in Bracewell & Giuliani LLP’s Environmental Strategies Group.