AEP v. Connecticut

The US Supreme Court heard oral argument in the AEP v. Connecticut case on April 19, 2010, and a ruling is expected by the end of the June. In this case, in which a coalition of state attorneys general sued electric power producers to cap and then reduce their carbon emissions, the high court agreed to consider three questions: whether the state respondents have standing to bring the case, whether the case should be dismissed because it raises non-justiciable "political questions," and whether EPA climate rules displace respondents' federal common law nuisance claims. Opponents of the suit have noted that the best result would be for the court to reject the case on standing grounds, because if the case falls for other reasons it would have less of an impact on other pending climate nuisance cases or any future environmental tort cases. Proponents of the suit have stated that the best their side could hope for is a 4-4 split that allows the case to proceed. To the extent that the court's questions can be relied upon to predict the eventual decision, neither of these outcomes seems likely. The caveat here, of course, is that sometimes the court's questions reflect where the court is heading, whereas other times they are indicative of the court's need for additional information. The court heard more than 75 minutes of argument. Based on the questions asked, the court did not appear inclined to rule on standing grounds, as both the utilities' lawyer and the Acting U.S. Solicitor General have urged. Indeed, during their respective presentations, the court's traditionally more conservative Justices asked questions seeming to defend the role of the federal courts in interpreting common law. On the other hand, the lawyer representing the state interests experienced difficulty describing a "manageable" lawsuit and was peppered with questions by the court's traditionally more liberal Justices. Manageability is key to the political question doctrine analysis. The issues that the court seemed to struggle with here include the extent to which EPA has acted decisively, or when and to what extent it will do so. The states' lawyer urged the court not to shut the courthouse door to state nuisance lawsuits based solely on "a promise to regulate." Judging from commentary published following the argument, the general consensus seems to be that this particular lawsuit is likely to fail, but on narrower grounds than some opposed to the suit had hoped, and without shutting the door entirely on climate change-related tort claims. Somewhat predictably, business-oriented publications have been more willing to speculate that a decision preventing the AEP case from going forward will put an end to climate change-related tort litigation, whereas members of the plaintiffs' bar have opined that an adverse decision in AEP would present only a temporary setback, after which additional legal theories will be developed and tested (similar to the litigation history in the asbestos, tobacco, and hazardous waste contexts). More interestingly, some reports have quoted attorneys who represent chemical, refining, manufacturing and insurer organizations — which naturally would oppose continued litigation in this area — as stating that climate change litigation is likely to continue regardless of how the high court rules. Notwithstanding the various predictions concerning the future of litigation in this area, there is likely to be at least a temporary respite while observers wait to see what the Supreme Court rules and, more importantly, how the ruling is crafted. Indeed, there is current evidence to support such a notion, given the status of two pending cases related to climate change and/or common law nuisance. First, in North Carolina v. TVA, a petition for writ of certiorari is currently pending. Although the Supreme Court could have decided to hear the case at the same time asAEP, it now appears that the court will decide whether to take the case after it decidesAEP. The facts of the North Carolina v. TVA case are as follows. In 2006, North Carolina, on behalf of its citizens, sued the Tennessee Valley Authority (TVA) and alleged that TVA's coal-fired power plants were a public nuisance. The trial court agreed as to some plants and issued an injunction requiring use of additional pollution control technology. In 2010, the Fourth Circuit reversed and held that the trial court had applied the wrong state law and that the plants' emissions did not create a nuisance. The holding implied that a broad range of causes of action (such as nuisance actions related to climate change) could be preempted by the Fourth Circuit's broad view of the Clean Air Act. North Carolina then filed a petition for writ of certiorari with the Supreme Court. Depending on whether the Court decides AEP on narrow or broad grounds, preemption could be the next big question in climate change litigation. Only the question of thefederal common law of nuisance is before the Court in AEP. Thus, further cases may be needed to decide the preemption issue. Second, the Kivalina litigation in the Ninth Circuit currently is on hold, too. In Kivalina, a coastal Native Alaskan village of approximately 390 Inupiat residents sued 24 oil and energy companies, claiming that the large quantities of GHGs emitted by the defendants contribute to climate change, which in turn has caused coastal ice to melt, resulting in coastal erosion that will require relocating the village (at an estimated cost of $400 million). This case remains pending before the Ninth Circuit, where it has been stayed until the Supreme Court rules in AEP v. Connecticut. In sum, the future of climate change-related tort litigation undoubtedly will be affected to some degree by the Supreme Court's decision AEP v. Connecticut. Whether or not the case is allowed to proceed is likely to be less significant in this regard than the particular bases articulated for the Court's decision, as well as whether a majority of Justices can reach agreement.

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