R.I. Wins Battle to Keep Climate Suit Vs. Big Oil in State Court

By Karen Savage

A federal judge ruled on Monday that Rhode Island’s climate liability suit against 21 oil and gas companies belongs in state court, where it was originally filed and where the state believes it has the best chance to succeed. The industry has argued in all the liability cases filed against it across the country that federal courts should hear these cases under federal law.

“There is no federal jurisdiction under the various statutes and doctrines adverted to by defendants,” U.S. District Court Judge William E. Smith wrote in the order, adding that Rhode Island’s claims are “thoroughly state-law claims.”

Rhode Island Attorney General Peter F. Neronha said he is looking forward to proving the state’s claim in state court.

“As the federal court recognized, the state’s lawsuit contains no federal question or cause of action, rather, contains only state law causes of action regarding damage to Rhode Island’s resources that are better suited to resolution in the state courts,” Neronha said in a statement. 

Rhode Island became the first state to file a climate liability suit last July, following more than a dozen others filed by municipalities including New York, Baltimore and numerous cities and counties in California. Rhode Island alleged that the 21 companies—including oil giants Exxon, BP, Shell, Chevron and ConocoPhillips—knowingly contributed to climate change and failed to adequately warn Rhode Island citizens about the risks posed by their products.

The oil company defendants unsuccessfully argued that the suit belongs in federal court, where they have a successful track record of persuading judges that climate issues should be dealt with by the legislative and executive branches and not the courts.   

The Rhode Island decision is the third big win for communities trying to keep their cases in state court. A federal judge in Maryland recently remanded Baltimore’s suit to state court and a group of California communities won a decision by U.S. District Court Judge Vince Chhabria that their cases belong in state court, a decision under appeal to the Ninth Circuit. 

“The district court’s decision to send Rhode Island’s case back to state court is important because what the oil companies are really after is dismissal of the case under federal law,” said Ann Carlson, an environmental law professor at UCLA’s Emmett Institute on Climate Change and the Environment who has done pro-bono consulting for some of the municipalities.

“They want a big substantive outcome—to get rid of the case all together,” Carlson said, adding that the district court squarely rejected the defendant companies’ argument that federal common law prevails and should preempt state law claims.

The jurisdictional battle of where these suits are heard is considered crucial to their success or failure. So far, only one set of cases filed in state courts—the ones filed by San Francisco and Oakland—were deemed to belong in federal court. In their cases, U.S. District Judge William Alsup came to the opposite conclusion of Chhabria and later dismissed the cities’ cases altogether. San Francisco and Oakland have appealed that dismissal and the removal to federal court. 

All of the California cases are awaiting Ninth Circuit’s decision on jurisdiction, which will likely hold sway over where they are all ultimately decided.  

“The oil companies had some early momentum, especially from Judge Alsup in the Northern District of California,” said Carlson, adding that Alsup’s decision hasn’t influenced other district court judges and could well be overturned on appeal.  

“The three judges who have found in favor of the plaintiffs are taking what I think is the more legally defensible position, which is that state law claims belong in state court,” Carlson said. “Rhode Island pled only state causes of action and the court was not willing to somehow transmute those causes of action into a federal claim.”

Chevron spokesperson Sean Comey said the suits are a waste of time and money.

“Previous court judgments correctly recognized that climate change is a global issue that requires a global solution by policymakers, not by the courts through litigation,” said Comey.  “Relying on Supreme Court precedent, federal judges in both New York and San Francisco have held that these types of lawsuits cannot proceed, whether asserted under federal law or state law.”

The companies have all maintained that climate change-related public nuisance claims are governed by federal common law.

That argument, successful in the dismissal of suits filed by New York City, San Francisco and Oakland, was rejected by Smith.

“Defendants, in essence, want the court to peek beneath the purported state-law façade of the state’s public-nuisance claim, see the claim for what it would need to be to have a chance at viability, and convert it to that,” Smith wrote in his ruling, adding that there is nothing in the artful pleading doctrine, which the defendants rely on, to support such an argument.

The judge also rejected the companies’ argument that the case was preempted by the Clean Air Act (CAA).

“As far as the court can tell, the CAA authorizes nothing like the state’s claims, much less to the exclusion of those sounding in state law,” wrote Smith. “In fact, the CAA itself says that controlling air pollution ‘is the primary responsibility of states and local governments.’”

Smith also pointed to a decision by the Sixth Circuit, which confirms that the CAA protects the rights of individuals to seek the enforcement of emission standards and to seek other types of relief.

Carlson said Monday’s decision makes it much more likely that discovery will go forward.

“If that happens, the plaintiffs’ lawyers will get a chance to question oil company executives about what they knew about climate change, when they knew it, what their companies did to prepare for its effects, and how they funded a campaign to persuade the public that climate change wasn’t happening,” Carlson said.

“I don’t think the oil companies want juries and judges to hear the evidence of their knowledge and subsequent campaign to distort the evidence of climate change. Today’s ruling gets Rhode Island one step closer to getting to present that evidence.”