EPA

Proposed climate rule may help hamstring nuisance claims

The Trump administration's proposal to replace the Clean Power Plan with a scaled-back climate rule may provide energy companies an advantage in future courtroom battles.

After EPA unveiled its Affordable Clean Energy rule this week, some industry experts said the measure would help stave off climate change "nuisance" lawsuits alleging harm from greenhouse gas emissions.

"There is no doubt that the ACE rule will make the argument regarding federal tort pre-emption even stronger," said Scott Segal, an energy lobbyist at Bracewell LLP.

Federal pre-emption refers to the legal understanding that EPA's air pollution authority set out in the Clean Air Act displaces federal lawsuits targeting polluters.

The Supreme Court ruled in 2011 that the Clean Air Act pre-empted claims from a state-led coalition suing six power companies over climate impacts because the court had previously found that EPA has authority over greenhouse gas emissions.

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In the past two months, federal courts have tossed nuisance lawsuits from New York City and a group of California municipalities on those grounds.

But as President Trump moved to rescind the Clean Power Plan last year, some experts wondered whether the absence of an EPA regulation could change how judges weigh the issue.

"If there was an outright repeal ... then there would be a very strong argument against pre-empting that litigation," Richard Revesz, director of New York University School of Law's Institute for Policy Integrity, told reporters earlier this week.

Many industry advocates supported the Trump administration's decision to replace — rather than simply rescind — the Obama-era Clean Power Plan (Climatewire, Oct. 12, 2017).

"The reason we are seeing this replacement rule is because industry groups are concerned about litigation, and they think a weak rule is much better for them than no rule at all," Revesz said.

'I think there's an argument there'

Segal said the ACE rule clearly demonstrates that the government is addressing climate change and that nuisance lawsuits will continue to fail in federal courts.

"The proposed rule addresses a broad swath of emissions sources with appropriate complexity and a legal seriousness of purpose that all support federal pre-emption of tort liability," he said.

But while the replacement plan is in motion, some environmental lawyers say its substance — or, in their view, its lack thereof — could help nuisance claims get some traction.

Environmental lawyer Sean Donahue, who helped defend the Clean Power Plan, said the ACE rule is so lax that EPA has essentially abdicated its responsibility to regulate.

"It would support arguments that, 'Look, the federal government is essentially choosing not to do anything or at least not to require anything,'" he told reporters this week. "And to the extent that's relevant to whether some other type of claim should be allowed to proceed, I think there's an argument there."

The Clean Power Plan, frozen by the Supreme Court in 2016, was an ambitious effort to make big reductions to greenhouse gas emissions across the entire electric grid. The proposed ACE rule is much smaller in scope, focusing on efficiency improvements at power plants. The regulation does not set a minimum requirement for emissions cuts.

"There's a serious question whether there's any real regulatory requirement to reduce emissions here at all," Donahue said.

But Crowell & Moring LLP attorney Tom Lorenzen, who represents electric cooperatives against the Clean Power Plan, argued that it makes no difference to the pre-emption analysis whether EPA actually regulates greenhouse gas emissions because the Supreme Court's 2011 ruling said it's the Clean Air Act itself that displaces federal common law claims.

"So no actual regulation is necessary for pre-emption to apply," he said. "In fact, the Court expressly rejected the argument that there was no pre-emption until EPA regulated. ... It is the delegation of authority from Congress that displaces federal common law."

Donahue acknowledged that it's unclear exactly how the issue would play out in the courtroom but maintained that "there are several features of the proposal today that would seem to me to support, at least to some extent, the positions of plaintiffs."

Our Children's Trust attorney Julia Olson, who represents a group of youth plaintiffs in a high-profile lawsuit over the government's alleged role in enabling climate change, said that while federal pre-emption is not at issue in her case, the ACE rule proposal underscores deficiencies in the government's handling of climate issues.

"The Trump administration's actions on energy continue to provide additional evidence in support of plaintiffs' claims, and we will bring forward that evidence at trial," she said.

Niskanen Center chief legal counsel David Bookbinder, who is representing three Colorado communities in climate-focused nuisance litigation against oil companies, said litigants in nuisance and other common law cases will continue to focus on keeping their cases in state court and under state laws so federal pre-emption doesn't apply.

"The issue is whether these claims are treated as state law claims, in which case whatever the feds are doing is irrelevant to that," he said, "or they're being treated as federal law claims, in which case [the Supreme Court] has already said it doesn't matter whether the EPA is doing anything or not."

This story also appears in Climatewire.

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