News & Analysis
May 18, 2021
The U.S. Supreme Court issued its first-ever ruling in the most recent wave of climate liability lawsuits yesterday, siding with BP, Exxon, Shell, Chevron, and other oil giants on a narrow procedural issue that did not get anywhere close to the central question of whether those corporations should pay for climate damages they knowingly caused.
Since 2017, Big Oil has fought hard to have the growing number of climate lawsuits filed against them in state court moved to federal court, where they believe it will be easier to escape accountability. The industry’s ongoing efforts to delay justice undergirded everything surrounding the issue before the justices in BP P.L.C. v. Mayor and City Council of Baltimore. Even though the court sided with Big Oil this time, it’s not clear how much of an impact the highly technical decision will have. Here’s what you need to know:
What is at stake in Baltimore’s lawsuit?
In 2018, Charm City sued 26 major oil and gas companies in state court to make the companies pay for climate change damages that resulted from the companies’ products and their decades-long campaign of climate deception. The Big Oil defendants fought to have the case heard in federal court instead, but a federal district court rejected a series of industry arguments and remanded the case back to state court. Last year, the Fourth Circuit Court of Appeals upheld that lower court decision, but the appeals court crucially found that it had jurisdiction to review only one of the eight arguments rejected by the district court.
What was the Supreme Court’s ruling?
On Monday, the justices ruled 7-1 that the Fourth Circuit should go back and consider Big Oil’s additional arguments for the case to be heard in federal court. (Justice Samuel Alito did not participate in the case, reportedly because he owns stock in oil companies. Justice Amy Coney Barrett, who previously recused herself from cases involving Shell because of her father’s longtime employment there, joined the majority that ruled in favor of Shell and the other Big Oil defendants.) The Court declined to consider the industry’s request to decide whether Baltimore and similar cases belong in state or federal court. The majority’s ruling did not address the merits of the underlying claims in Baltimore’s lawsuit.
What impact will this have on other climate liability cases?
Three other federal appeals courts — the First, Ninth, and Tenth — previously reached the same conclusion as the Fourth Circuit, ruling that their scope of appellate review was limited to a single issue and, based on that review, these cases should proceed in state court. After the Supreme Court’s ruling in the Baltimore case, lawsuits from Rhode Island and communities in California and Colorado will also be sent back to their respective appeals courts to consider Big Oil’s additional jurisdictional arguments already rejected by lower courts.
But as we explained last fall, this delay may not actually produce a different result in those cases: “The appeals courts could consider these other arguments and agree with the lower courts – that the cases [still] belong in state court.”
However, now that the Supreme Court has clarified which questions the appeals courts should review, Big Oil will not be able to use this delay tactic in more recently filed climate liability lawsuits. Without this procedural hurdle, a long list of climate liability cases — in Minnesota, Delaware, Connecticut, the District of Columbia, and the cities and counties of Hoboken, New Jersey; Charleston, South Carolina; Maui and Honolulu, Hawaii; New York City, and Annapolis and Anne Arundel County, Maryland — could now be on a faster path to trial.
As CCI Executive Director Richard Wiles explained after the Supreme Court handed down its decision: “This narrow procedural ruling may ultimately have little impact on efforts by Baltimore and more than 20 other states and municipalities to hold oil and gas corporations accountable for causing and lying about climate change. Virtually every court to consider this jurisdictional issue has agreed that climate damages cases filed in state court belong in state court. While today’s ruling may cause a delay for some municipalities seeking their day in court, Big Oil can’t escape accountability forever.”
