325 F. Supp. 3d 466
S.D. Ill.2018Background
- New York City sued five major oil companies (BP, Chevron, ConocoPhillips, Exxon, Shell) alleging that their production, marketing, and sale of fossil fuels contributed to greenhouse gas emissions that caused climate-change harms to the City, and seeking damages and injunctive relief for nuisance and trespass.
- City alleges defendants are among the largest cumulative fossil-fuel producers and that their products, when combusted, emit greenhouse gases that diffuse globally and have caused sea-level rise, heat harms, and related costs to NYC, prompting a multi-billion dollar resiliency program.
- City contends defendants knew of climate risks for decades and ran campaigns to downplay those risks while protecting their own assets.
- U.S.-based defendants (Chevron, ConocoPhillips, Exxon) moved to dismiss under Rules 12(b)(1) and 12(b)(6), arguing federal common law governs and is displaced by the Clean Air Act, that the claims raise separation-of-powers and foreign-policy concerns, and that state law cannot supply relief.
- The District Court held the City’s claims arise under federal common law, found those claims displaced by the Clean Air Act for domestic emissions, and declined to recognize claims for foreign emissions because of extraterritoriality and foreign-policy/separation-of-powers concerns; it dismissed the amended complaint with prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether City’s claims are governed by federal common law or state law | City framed claims as based on defendants’ production/sale of fossil fuels (state tort law) rather than direct emissions | Defendants: claims are really about greenhouse-gas emissions that diffuse transnationally, so federal common law governs | Federal common law governs because claims stem from transboundary greenhouse-gas emissions requiring uniform national solution |
| Whether federal common-law claims are displaced by the Clean Air Act | City: Clean Air Act does not regulate production/sale of fuels, so it does not displace City’s claims | Defendants: AEP and Kivalina show Clean Air Act speaks directly to domestic GHG regulation and displaces federal common-law nuisance/trespass claims | Displaced—Clean Air Act displaces federal common-law claims for domestic greenhouse-gas emissions; state law relief not available here given interstate/global nature |
| Whether state-law claims remain available after displacement | City: If federal law displaced, state law claims should be allowed to the extent not preempted | Defendants: Allowing state-law claims would undermine the need for a uniform federal approach to interstate/global emissions | Court refused to permit state-law fallback for these interstate/global claims because federal concern and need for uniformity preclude state resolution |
| Whether claims implicate extraterritoriality/foreign policy such that courts should decline to recognize them | City: Suit is justiciable and distinguishable from cases limited to domestic emitters | Defendants: Claims reach foreign emissions and foreign entities, raising extraterritoriality and serious foreign-policy/separation-of-powers concerns | Court declined to recognize claims for foreign emissions; exercising caution due to extraterritorial and foreign-policy implications; dismissed complaint |
Key Cases Cited
- Connecticut v. Am. Elec. Power Co., 564 U.S. 410 (2011) (Clean Air Act displaces federal common-law nuisance claims seeking to abate domestic CO2 emissions)
- Native Vill. of Kivalina v. ExxonMobil Corp., 696 F.3d 849 (9th Cir. 2012) (AEP displacement principle extends to damages claims for domestic greenhouse-gas emissions)
- Tex. Indus., Inc. v. Radcliff Materials, Inc., 451 U.S. 630 (1981) (federal common law may be necessary to protect uniquely federal interests)
- Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 (1964) (limits on state law where federal interests require uniformity)
- Int'l Paper Co. v. Ouellette, 479 U.S. 481 (1987) (control of interstate pollution is primarily a matter of federal law)
- Illinois v. City of Milwaukee, 406 U.S. 91 (1972) (federal common law applies to ambient or interstate air and water pollution)
- Mobil Oil Corp. v. Higginbotham, 436 U.S. 618 (1978) (statutory displacement test asks whether statute speaks directly to the question)
- Sosa v. Alvarez-Machain, 542 U.S. 692 (2004) (courts should be cautious creating new causes of action, leaving many issues to political branches)
- Jesner v. Arab Bank, PLC, 138 S. Ct. 1386 (2018) (courts should be wary of recognizing causes of action with significant foreign-relations implications)