States’ CO2 ‘Nuisance’ Suit Threatens Already-Staggering Economy

Published December 14, 2010

The United States Supreme Court on December 6 agreed to review a federal appellate court ruling many condemn as the most extreme example to date of “regulation by litigation.” The plaintiffs allege emissions of carbon dioxide and other greenhouse gases from defendants’ plants, which generate electricity for millions of people in 21 states, amount to a public nuisance and ought to be regulated by the courts.

The case was brought by the states of California, Connecticut, Iowa, New Jersey, New York, and Rhode Island; the City of New York; and three nonprofit land trusts. We should hope the Supreme Court will stop such activist judging in its tracks.

Over the past few decades, public nuisance has become a favorite of plaintiffs’ lawyers because it is, to them, so delightfully vague. It condemns almost anything that infringes “enjoyment” of property. As one commentator put it, “There is perhaps no more impenetrable jungle in the entire law than that which surrounds the word ‘nuisance.’ It has meant all things to all people, and has been applied indiscriminately to everything from an alarming advertisement to a cockroach baked in a pie.”

Public nuisance cases have been brought in state courts against the makers of lead-based paint, guns, and tobacco, to name just a few industries, largely without success. But unscrupulous plaintiffs’ attorneys are undeterred, and greenhouse gas emitters are the latest target—and perhaps the most economically significant one to date.

The plaintiffs allege a rather convoluted chain of causation: (1) The defendants’ greenhouse gas emissions elevate atmospheric greenhouse gas levels; (2) Such elevated greenhouse gas levels contribute to climate change; (3) Climate change, in turn, contributes to future risks of droughts, floods, wildfires, ecosystem disruption, and reduced biodiversity; and (4) all of this amounts to a public nuisance and results in injury to the plaintiffs and the general public.

Thus, they allege, the judge must order defendant power generators to cap their greenhouse gas emissions. The judge should decide the amount of emissions subject to such caps, each year for 10 years. Furthermore, they allege, judges must force emission limits upon similar facilities across the country.

The trial court dismissed these claims, calling them political questions reserved to Congress. Climate change is a “global phenomenon,” the trial court said. Many industries, not just the defendants, emit greenhouse gases, the trial court said, and the issues of which particular industries ought to be required to limit their greenhouse gas emissions, and by what amounts, are necessarily the types of policy considerations Congress is uniquely equipped to consider.

The Second Circuit Court of Appeals reversed the decision. The case, this court said, is an “ordinary tort suit” involving alleged injury and could be decided by courts according to what emission levels are “reasonable.”

The Second Circuit’s ruling is important because there are several other cases now pending involving similar theories. For example, carmakers have been sued by several states on the theory that automotive emissions of carbon dioxide cause global warming and hence are public nuisances. The states want monetary damages from the carmakers.

In another case, an Alaskan village sued 24 oil and energy companies, seeking money damages to relocate the village because storms (allegedly induced by global warming) are eroding its coastline. In Mississippi, property owners have alleged dozens of oil, coal, chemical, and utility companies are liable for property damages caused by Hurricane Katrina. The hurricane, they allege, was more intense than it otherwise would have been due to the defendants’ emissions of greenhouse gases.

The case now accepted by the Supreme Court is important, the utility defendants said in their court papers, because the “ramifications of this holding, if it is allowed to stand, are staggering. A single judge could set emissions standards for regulated utilities across the country.”

In fact, the ramifications go far beyond utilities. As the defendants noted, “virtually every entity and industry in the world is responsible for some emissions of carbon dioxide,” as many as six million sources. All of these potentially are subject to judicial regulation if the Second Circuit decision stands. For this reason, the U.S. Chamber of Commerce, as well as small business and farm organizations, joined the defendants in urging the Supreme Court to take the case due to its “staggering economic implications.”

Such contentions are not mere puffery; the “staggering” economic risks posed by potential judicial regulation are real. Let’s hope the Supreme Court rules such judicial regulation unlawful.

Maureen Martin ([email protected]), an attorney, is senior fellow for legal affairs at The Heartland Institute.