The energy industry has known for decades that federal regulators eventually would set rules under the Clean Air Act to govern emissions of mercury and other air toxics from coal-fired power...
Has the Supreme Court frozen climate change litigation?
Additionally, AEP can be strictly applied only to the concept of nuisance suits brought in federal court under the federal common law. It doesn’t explicitly hold that nuisance suits brought in a state court under state common law can’t be sustained, so uncertainty remains in that regard. And behind that uncertainty is the ever-present risk that utilities and other GHG emitters can be forced to expend litigation costs in response to nuisance suits—with the ultimate question of liability in state court still undecided.
Also undecided are those other aspects of climate change litigation unrelated to air emissions. Specifically, the use and release of water are also factors in any broad analysis of climate change, and whether the principles of state nuisance law can be applied to these areas is yet another unanswered question.
Accordingly, the main thrust of AEP is merely that allegations about the adverse impact of climate change are best served in a broad regulatory process and not in piecemeal federal litigation filed against only certain components of industry. Stated differently, AEP answers only one of the many litigation questions relating to climate change.
Just as it remains difficult to predict what types of lawsuits can still be brought after AEP, it’s equally difficult to predict the impact that AEP will have upon utility companies. However, questions of costs and financing certainly remain. For example, a major utility recently announced it’s putting a hold on efforts to implement a carbon capture strategy at a coal-fired power plant located in West Virginia.
Finally, an analysis of damages potentially recoverable in litigation would be incomplete without mentioning insurance. Whether claims for damage from climate change are covered by a general liability insurance policy also remains an open issue, although one court recently held that there was no coverage. 44
Simply put, while large-scale emitters of greenhouse gases can take solace in the AEP decision, they can’t consider the larger issues to have been resolved.
1. 549 U.S. 497 (2007).
2. Slip Op. No. 10-174 (U.S., June 20, 2011).
3. See Pets. for Rev., Massachusetts v. EPA , 415 F.3d 50 (D.C. Cir. 2005)(Nos. 03-1316 to 03-1368, consolidated under 03-1361) (“Consol. Br. for Petrs.”).
4. Consol. Br. for Petrs. at 2-3.
5. Id. at 4.
6. Massachusetts, 549 U.S. at 518.
7. Id. at 519-520.
8. 206 U.S. 230 (1907).
9. Massachusetts, 549 U.S. at 518 (citing Tennessee Copper Co. , 206 U.S. at 237.).
10. Massachusetts, 549 U.S. at 518.
11. Id. at 528-529.
12. Id. at 528.
13. 42 U.S.C. § 7411.
14. Justice Sotomayor recused herself because she sat on the Second Circuit panel that decided the case (although she took no part in the decision).
15. Connecticut v. Am. Elec. Power Co., Inc. , 406 F. Supp. 2d 265 (S.D.N.Y. 2005).
16. Connecticut v. Am. Elec. Power Co., Inc. , 582 F.3d 309, 316 (2d Cir. 2009).
17. Id. at 317.
18. Id. at 318.
19. Connecticut, 406 F. Supp. 2d at 270-74.