In a decision that experts say could have profound implications on the future of climate change litigation, a two-judge panel of a federal appeals court on Monday reversed a 2005 district court decision and ruled that eight states and New York City can sue coal-burning utilities for creating a “public nuisance” through their emissions of climate-warming greenhouse gases.

The Second Circuit Court of Appeals found in its 139-page decision (PDF) that the question raised by two separate suits—brought under federal common law of nuisance against the same six major power companies—was not a political one, as held in 2005 by the U.S. District Court of the Southern District of New York.

The plaintiffs in Connecticut v. Am. Elec. Power Co. (2005)—California, Connecticut, Iowa, New Jersey, New York, Rhode Island, Vermont, Wisconsin, and New York City—sued six companies, including American Electric Power (AEP), Southern Corp., the Tennessee Valley Authority (TVA), Xcel Energy, and Cinergy Corp. As in a separate suit brought by three land trusts, the states and New York City alleged that by owning and operating fossil-fuelled power plants in 20 states, the corporations had contributed to the public nuisance of global warming.

The states had specifically said that the coal-fired carbon emissions of 650 million tons per year was causing—and would continue to cause—“serious harms affecting human health and natural resources.”

With the district court’s dismissal of the complaints as a political—not judicial—question, the plaintiffs appealed the case, arguing that the “political question doctrine” did not bar adjudication of their claims. The power companies asked, meanwhile, that the district court’s decision be upheld. TVA went further, asserting that the complaints be dismissed on the basis of the “discretionary function exception.”

“We hold that the district court erred in dismissing the complaints on political question grounds; that all of Plaintiffs have standing; that the federal common law of nuisance governs their claims; that Plaintiffs have stated claims under the federal common law of nuisance; that their claims are not displaced; and that TVA’s alternate grounds for dismissal are without merit,” wrote Circuit Judge Peter Hall for the appellate court on Monday. “We therefore vacate the judgment of the district court and remand for further proceedings.” 
 
The decision will mark the first time a court had permitted climate change litigation to survive a motion to dismiss, and this will likely have major implications on the future of public nuisance suits as they pertain to climate change, said toxic tort and environmental attorney R. Trent Taylor.

“Not only did the court state that the political question doctrine was not a valid defense for defendants, the court went a step further and said the plaintiffs have standing and that the allegations in the lawsuit actually stated a valid claim under the federal common law of nuisance,” Taylor, a public nuisance case specialist at McGuireWoods LLP, told POWERnews on Tuesday.

“This means that unless the full Second Circuit or the U.S. Supreme Court steps in and reverses this decision, this suit will go to trial—a heretofore unthinkable result in the context of climate change litigation.” 

Taylor explained that until the court’s decision, the plaintiffs in climate change litigation had been unable to gain any traction at all. “With the removal of the political question barrier with this decision, the energy industry can expect a large uptick in copycat suits as plaintiffs now have some legal authority on which to base their claims,” he said.

“The fact that this legal authority comes from not only a federal circuit court of appeals, but the widely respected Second Circuit, will further embolden plaintiffs.”

Prior to this decision, Taylor had written a guest column for POWER magazine on the looming threat of climate change litigation that will appear in the forthcoming October issue.

Sources: U.S. Court of Appeals, Second Circuit, POWERnews