Oil Giants Win Climate Suit as Judges Push For Political Fix

(Bloomberg) -- New York City failed to persuade a federal appeals court to reinstate a climate-change lawsuit against Exxon Mobil Corp., BP Plc and three other oil companies, with the judges saying the problem demands political rather than legal solutions.

The Friday ruling by the U.S. Court of Appeals in New York is a setback for those trying to use the courts to hold the industry responsible for costs associated with rising seas and other consequences of a warming planet. Chevron Corp., Royal Dutch Shell Plc and ConocoPhillips were also sued in the case.

The court said global warming “is a uniquely international concern” that requires the federal government to step in rather than judges. Only the U.S. Environmental Protection Agency has the authority to regulate domestic greenhouse gas emissions, the unanimous three-judge panel held.

New York City “sidestepped” federal procedure with a state-law tort suit against the energy companies even though their commercial activity of selling fossil fuel products around the world is “admittedly legal,” U.S. Circuit Court Judge Richard Sullivan wrote for the court.

‘Patchwork of Claims’

“In so doing, the City effectively seeks to replace these carefully crafted frameworks –- which are the product of the political process –- with a patchwork of claims under state nuisance law,” Sullivan wrote.

A lower court judge in 2018 tossed out the lawsuit on similar grounds, ruling that the federal Clean Air Act governs carbon dioxide emissions and blocks lawsuits. New York City’s press office didn’t immediately respond to a message seeking comment.

About a dozen cities, counties and states across the U.S. have sued Exxon, Chevron, BP, Royal Dutch Shell and their peers. The suits seek to reimburse taxpayers for the costs of adapting to climate change — from building multibillion-dollar sea walls to repairing damage from powerful storms and, perhaps soon, moving whole communities inland.

Read More: Making Big Oil Pay for Climate Change May Be Next to Impossible

The federal appeals court in San Francisco in 2019 rejected a lawsuit brought on behalf of young people who sought to force the government to draw up a plan to phase out fossil fuel emissions. The majority in the case held in a split decision that climate change should be addressed by Congress and the electorate, not the courts.

Exxon is also fighting a case in Massachusetts, where the state’s Democratic attorney general last year accused the company of misleading consumers and investors about the financial impact of climate-change on its business as well as the “green” value of some of its products. The company says the suit amounts to illegal punishment for the energy giant’s views about fossil fuels, and has asked the judge to dismiss it.

Exxon in December 2019 prevailed in a similar but narrower lawsuit filed by the state of New York, which also accused the energy company of misleading investors by giving false information about how it accounted internally for the future cost of climate change on its business.

Minnesota and Baltimore are among the other state and local governments that are pursuing climate litigation.

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