By Dana Drugmand
The oil companies being sued by the city of Baltimore for the costs of climate damages have appealed a recent decision by a federal judge sending the case to state court. But while the companies try to convince the appeals court that the case belongs in federal court, the judge who ordered the case back to Maryland court sustained her decision Wednesday by refusing to stop the litigation while the companies appeal.
Like other local governments that have sued fossil fuel companies for climate liability, Baltimore’s suit is fighting a jurisdictional battle to keep the case in state court, where most experts say these cases will have better odds of succeeding. The companies want the cases in federal court, where they have already had success in getting two of the cases dismissed. So far, the three judges have agreed the cases should be decided by state courts, while one federal judge in California decided last year that San Francisco and Oakland’s suits belong in federal court, and then dismissed them.
U.S. District Judge Ellen Hollander granted Baltimore’s motion to remand to state court on June 10. The lawsuit, filed last year, alleges that more than two dozen fossil fuel companies are liable for the costs of damages and adapting to climate change. The causes of action include nuisance, product liability claims like design defect and failure to warn, trespass, and violation of the Maryland Consumer Protection Act – all claims under state law.
The companies, led by Chevron’s legal team, argued in a brief filed Monday in the Fourth Circuit Court of Appeals that the case presents “uniquely federal issues” and belongs in federal court. Despite the claims pled under state law, defendants say the claims arise under federal common law because the lawsuit, they say, seeks to regulate interstate emissions.
Hollander had rejected these arguments in her order. “The city does not seek to modify any regulations, laws, or treaties or to establish national or global standards for greenhouse gas emissions,” she wrote. “Rather, as the city observes, it seeks damages and abatement of the nuisance within Baltimore.”
Hollander initially stayed her order for 30 days. The companies then requested a separate stay while the Fourth Circuit considers their appeal. Hollander denied that request on Wednesday.
She disagreed with defendants’ assertion that they are likely to succeed on the merits of their appeal. Appellate review of remand orders, she noted, is strictly limited. Only cases involving issues of “federal officer” or civil rights are reviewable, according to federal law. Although defendants argue the “federal officer” applies since they operate under permits issued by federal officials, they cannot broaden the scope of review beyond that.
Hollander also rejected the companies’ arguments that declining the motion to stay would cause them irreparable harm. The companies say that proceeding in state court would cost them significant time and money.
“This case is in its earliest stages and a stay pending appeal would further delay litigation on the merits of the City’s claims,” Hollander wrote. “This favors denial of a stay, particularly given the seriousness of the City’s allegations and the amount of damages at stake.”
The companies said they would appeal should their motion for a stay be denied. Hollander did agree to extend the stay while the defendants pursue this separate appeal, and both sides agreed to it.
Attorney Vic Sher, partner at Sher Edling which is helping to represent Baltimore and other communities in climate liability lawsuits, said that Hollander and two other judges have made it clear that these cases should proceed in state courts.
“We agree with Judge Hollander’s detailed and thorough remand order, which is consistent with two more federal judges who all agree that the industry is wrong and that these cases belong in state court, where we are eager to get going,” he said.