U.S. Supreme Court Reverses Decision, Dismissing Federal Climate Change Claim – Client Alert

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U.S. Supreme Court Reverses Decision, Dismissing Federal Climate Change Claim

June 2011

This is the latest in a series of alerts regarding the status of climate change litigation. To review previous alerts on this subject, see Wilson Elser's March 2011, December 2010 and November 2010 Alerts.

On June 20, 2011, the United States Supreme Court reversed the decision of the United States Court of Appeals for the Second Circuit in American Electric Power Co. Inc., et al. v. Connecticut et al., and dismissed the federal common law nuisance climate change claim brought by several states, the City of New York and three land trusts against four private power companies and the Tennessee Valley Authority. In its decision, the United States Supreme Court held that the federal common law claim was displaced by Congress' delegation of the authority to regulate greenhouse gases to the Environmental Protection Agency in the Clean Air Act, as the Court had decided in 2007 in Massachusetts v. Environmental Protection Agency, 549 U.S. 497 (2007). The EPA is expected to propose greenhouse gas regulations for stationary sources in July of is year.

The impact of the decision on state law–based climate change nuisance claims is uncertain. The Court remanded the matter to the Second Circuit to address the pending state law claims, which the Second Circuit had not reached. The Court's displacement analysis clearly suggests, however, that the Court may find, when it reaches the pre-emption question, that Congress intended in enacting the Clean Air Act to occupy the entire field of greenhouse gas regulation. If so, state law claims would be preempted. The ultimate result may turn on the extent to which EPA exercises its regulatory authority.

If state law claims are not preempted, the decision may be beneficial to plaintiffs. Four members of the Court rejected the two principal arguments, other than displacement, on which the defendants had relied: (1) that the plaintiffs had no standing because they suffered from climate change in the same way as everyone else and (2) that the issue of greenhouse gas regulation was a political question, which could not be resolved by litigation. Although four other members of the Court apparently felt differently, and both issues thus remain unresolved, Justice Sonia Sotomayor, who did not participate in the decision because she was on the Second Circuit panel that decided the case (she heard argument on the case, but did not participate in the decision because of her nomination to the Supreme Court at that time), will be the deciding vote should those issues be squarely presented in a subsequent appeal.

On balance, today's decision appears to favor those who would defend against climate change nuisance suits, since it eliminates the possibility of further federal nuisance law claims. The final chapter on state law–based claims will not be written, however, until after the remand to the Second Circuit.

We will continue to follow the litigation closely and keep you advised of further developments.

For more information contact:

Robert A. Spolzino
Partner
White Plains<BR< P>
914.872.7497
robert.spolzino@wilsonelser.com

William K. Enger
Partner
Los Angeles
213.330.8919
william.enger@wilsonelser.com

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