Before the Deluge*: Fifth Circuit Joins Second Circuit in Allowing Climate Change Tort Suits, while District Court Dismisses Similar Claims

On October 16, 2009, the Fifth Circuit joined the Second Circuit in reversing a dismissal of common law tort claims based on actions alleged to have caused climate change. The decision in Comer v. Murphy Oil USA, Inc. was the second decision in a month allowing such claims to proceed, following the Second Circuit’s detailed opinion reversing a similar decision in Connecticut v. Am. Elec.

On October 16, 2009, the Fifth Circuit joined the Second Circuit in reversing a dismissal of common law tort claims based on actions alleged to have caused climate change. The decision in Comer v. Murphy Oil USA, Inc.[1] was the second decision in a month allowing such claims to proceed, following the Second Circuit’s detailed opinion reversing a similar decision in Connecticut v. Am. Elec. Power Co.[2] These two opinions highlight the appellate courts’ willingness to allow both private and public plaintiffs to press common law tort claims involving climate change, while the most recent decision by a district court goes the other way. Shortly before the Fifth Circuit’s decision, the Northern District of California in Native Village of Kivalina v. ExxonMobil Corp.[3] dismissed claims on standing and political question grounds. Most commentators consider it likely that the Kivalina decision will be appealed to the Ninth Circuit.[4]

Background

Comer v. Murphy Oil was brought in 2005, shortly after Hurricane Katrina, by a putative class of Mississippi coastal residents who sued a number of energy, oil and refining and chemical manufacturing companies, claiming that their activities contributed to climate change and increased the damage done by the hurricane. Unlike the plaintiffs in AEP and Kivalina, who presented claims under federal common law, the plaintiffs in Comer grounded their claims on state common law and brought their federal action based on diversity, asserting public and private nuisance, trespass and negligence claims under Mississippi law.[5] After the district court dismissed on political question and standing grounds, plaintiffs appealed to the Fifth Circuit.

Native Village of Kivalina was brought in 2008 by the Alaskan coastal village of Kivalina,[6] which maintained that a loss of sea ice caused by climate change threatened the land where the village is located. Kivalina sued numerous oil and power companies, asserting federal common law claims of public nuisance, as well as private and public nuisance under California state law. Plaintiffs sought damages for the cost of moving the entire village to a new location.

The Second Circuit decided Connecticut v. AEP on September 21, 2009,[7] while the Northern District of California dismissed Kivalina on September 30, expressly disagreeing with the Second Circuit.[8] The Fifth Circuit decided Comer on October 16, reversing and remanding for substantially the same reasons as had the Second Circuit.[9]

Discussion

The decisions in Comer and Kivalina addressed standing and the justiciability of what are arguably political questions in the context of climate change. The two rulings are irreconcilable on both points.

Fifth Circuit on Standing – a Minimal Contribution to Harm Is All That Is Required at the Pleading Stage

Because Comer was a diversity case grounded on “state common-law rights of action, plaintiffs [had to] satisfy both state and federal standing requirements.”[10] While their claims “easily satisf[ied] Mississippi's ‘liberal standing requirements,’”[11] the Fifth Circuit held that “more rigorous standards apply” to the federal standing inquiry.[12] Under federal law, plaintiffs must show (1) an “injury-in-fact;” (2) that the injury is “fairly traceable” to the activities of the defendants; and (3) that the alleged injury is “redressable” by the courts.[13]

In AEP, the Second Circuit examined all three of these requirements for standing, while the Fifth Circuit focused solely on traceability (causation).[14] Relying on the Supreme Court’s decision in Massachusetts v. EPA,[15] where the Supreme Court had accepted “a causal chain virtually identical in part to that alleged by plaintiffs,” the Fifth Circuit rejected arguments by the defendants “that traceability is lacking because their emissions contributed only minimally” to climate change.[16]

The Fifth Circuit examined a series of Clean Water Act decision that had addressed the question of how much of the defendants’ activity “contributed” to the alleged harm for purposes of standing. The Second Circuit also reviewed these cases in AEP, as did the Northern District of California in Kivalina (discussed below). Finding that “plaintiffs need not show to a scientific certainty that … defendant’s [pollutants] alone, caused the precise harm suffered by the plaintiffs,” the court said it was sufficient if “the [defendant’s] pollutant causes or contributes to the kinds of injuries alleged by the plaintiffs.” Under this logic, a plaintiff need not “pinpoint[] the origins of particular molecules, [but rather] merely show that a defendant discharges a pollutant that causes or contributes to the kinds of injuries alleged in the specific geographic area of concern.”[17]

The court rejected the defendants call to have it “evaluate the merits of plaintiffs’ causes of action,” finding that such an inquiry “was misplaced at this threshold standing stage of the litigation.”[18] The court distinguished the causation requirement for standing from that of proximate causation in tort, holding that in the former, “an indirect causal relationship will suffice, so long as there is ‘a fairly traceable connection between the alleged injury in fact and the alleged conduct of the defendant.’”[19] The Court however acknowledged that the plaintiffs “will be required to support [their causation] assertions at later stages in the litigation.”[20]

This last point bears emphasis, since, while the procedural issues presented by these cases are interesting, they belie the difficulty that plaintiffs may face in proving causation and damages at the merits stage of the litigation. In addition, the Fifth Circuit noted that the plaintiffs’ state common law claims presented an “ordinary tort suit,”[21] though the federal questions of justiciability and the ability of the federal courts to make common law in what is arguably a political arena present thornier questions.

Northern District of California on Standing – Plaintiffs Must Allege a “Substantial Likelihood” that Defendants’ Conduct Caused Harm

In Kivalina, the Northern District of California reached the opposite conclusion as that of the Second and Fifth Circuit. Ignoring the Supreme Court’s approach in Massachusetts v. EPA, the court relied (ironically) on Fifth Circuit precedent, but read that precedent in a way which was irreconcilable with the Fifth Circuit’s decision in Comer.

Addressing the same Clean Water Act cases relied on in Comer, the district court stated that they required a showing of a “substantial likelihood that defendant’s conduct causes plaintiffs’ harm,” one which could only be made by demonstration that a federally prescribed effluent limitation was exceeded. [22] Since there has never been a federal limit established for greenhouse gas emissions, it was impossible to make that showing. The district court criticized the Second Circuit’s opposite conclusion in AEP, calling it“circular” and “illogical,” [23] criticism that presumably would also apply to the Fifth Circuit’s opinion in Comer, which adopted this same reasoning.

The district court also was unwilling to accept the attenuated traceability that both the Second Circuit and Fifth Circuit found persuasive, requiring plaintiffs to show harm from emissions attributed to a “specific person, entity, group at any particular point in time,” and a geographic proximity between the emission and the harm. Where “there is no realistic possibility of tracing any particular alleged effect of global warming to any particular emissions,” and the relevant geographic area is “the entire world,” the district court found that these requirements had not been met. [24]

Finally, unlike the Second and Fifth Circuits, the Kivalina court looked at the merits and was unwilling to accept causation that was “dependent on a series of events far removed both in space and time from the Defendants' alleged discharge of greenhouse gases.” [25]

Fifth Circuit on Political Questions – Unless Unequivocally Delegated to Congress or the Executive, the Courts May Decide Questions with Political Implications

In its famous “one-man, one-vote” decision in Baker v. Carr, the Supreme Court adopted a non-exclusive list of “formulations” of non-judiciable political questions:

[1] a textually demonstrable constitutional commitment of the issue to a coordinate political department [the Legislative or Executive branches]; or [2] a lack of judicially discoverable and manageable standards for resolving it; or [3] the impossibility of deciding without an initial policy determination of a kind clearly for nonjudicial discretion[.]

Addressing whether Comer presented such a question, the Fifth Circuit read the textual commitment component as a “but-for” test: “if a party … is unable to identify a constitutional provision or federal law that arguably commits a material issue in the case exclusively to a political branch, the issue is clearly justiciable and the motion should be denied without applying the Baker formulations.”[26] The court defined the “issues” narrowly – rather than the complicated issues surrounding climate change, the court focused instead on the “[issues] inherent in the adjudication of plaintiffs’ Mississippi common law tort claim for damages.”[27] Since federal courts regularly decide state tort cases, and no text in the Constitution could possibly be read to reserve that power to a political branch, the Court concluded that the political question issue should be resolved in favor of the plaintiffs.

Unlike the situation in AEP and Kivalina, the fact that Comer presented claims asserted by private parties under state law was very important to the Fifth Circuit’s decision. The court noted that it could find no prior example of a federal court dismissing such an action on political question grounds.[28] Instead, “[t]hree Circuits have stated, in the political question context, that ‘the common law of tort provides clear and well-settled rules on which the district court can easily rely’”[29] … “Mississippi and other states’ common law tort rules provide long-established standards for adjudicating the nuisance, trespass and negligence claims at issue. The policy determinations underlying those common law tort rules present no need for nonjudicial policy determinations to adjudicate this case.”[30]

While disposition of the case might be “political … in the broad sense, i.e., that it has political implications or ramifications,”[31] that fact alone was not enough to render the case non-justiciable, since federal courts routinely decide cases “that merely implicate[] a matter within the authority of a political branch,” including judicial review of federal statutes and resolution of disputes regarding the limits of authority of the political branches.[32]

Northern District of California – Resolution of Climate Change Policy Presents a Non-Justiciable Political Question

While the Northern District of California found no constitutional commitment of the issues before it to the political branches,[33] it focused on the second and third Baker factors, namely, a lack of judicially-manageable and discoverable standards, and a need for an initial policy determination by the political branches. With respect to judicial standards, the court focused on the necessity for “the factfinder [to] balance the utility and benefit of the alleged nuisance against the harm caused.”[34] The court stated that the need to balance “the benefits derived from” … “energy-producing alternatives” against “the risk that increasing greenhouse gases would in turn increase the risk of causing flooding along the coast of a remote Alaskan locale.”[35] The court concluded that it could not make such a decision in any reasoned fashion. Discussing the Second Circuit’s conclusion in AEP (echoed by the Fifth Circuit in Comer) that tort law would provide all the standards required, the district court was “not so sanguine. While such principles may provide sufficient guidance in some novel cases, this is not one of them.”[36]

The court also found that “a determination of what would have been an acceptable limit on the level of greenhouse gases emitted by Defendants,” and a “policy decision about who should bear the cost of global warming”[37] were essentially political questions: “[T]the allocation of fault-and cost-of global warming is a matter appropriately left for determination by the executive or legislative branch in the first instance.”[38]

Conclusion

One month ago, no Circuit Court had spoken on climate change nuisance actions and every district court confronted with these cases had uniformly dismissed them. But with the Second Circuit’s ruling in AEP, and the Fifth Circuit’s decision in Comer, plaintiffs may be emboldened by the weight of authority to move forward with similar claims, and district courts will likely be more reluctant to dismiss these suits at the pleading stage.

However, plaintiffs – including the plaintiffs in AEP and Comer – still face significant obstacles to victory on the merits. Successful tort claims must meet a more stringent causation standard than that required to demonstrate standing. Furthermore, for public nuisance actions, plaintiffs must establish that the harm they suffer outweighs the utility of the defendants’ conduct, which may be difficult when the conduct meeting the nation’s energy demands. Finally, several states limit recovery from defendants that are not wholly responsible for an injury, which will affect private nuisance actions.

Kivalina will almost surely be appealed, and the Ninth Circuit’s decision, when it comes, will either continue the trend established by the Second and Fifth Circuits or create conflicting precedent that could end up in the Supreme Court. If the Supreme Court does not reverse AEP, Comer or (if the Ninth Circuit reverses) Kivalina, and if federal legislation does not address potential liability for past contributions of GHG emissions, the issue may end up being resolved on the merits, judgment by judgment, in every jurisdiction in the country.

For more information, please contact Adam Orford, Steve Jones, or any member of our Climate Change practice group.