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Federal court approves long-stalled nuisance lawsuit against power companies
09/21/2009
Darren Samuelsohn
E&E News
A federal appeals court ended three-and-a-half years of silence today in ruling that five of the nation's largest electric utility companies can stand trial for allegations that their greenhouse gas emissions created a public nuisance that contributed to global warming.
The 2nd U.S. Circuit Court of Appeals sided with a coalition of eight states, New York City and environmental groups in a case brought under federal common law that claimed the power companies were harming residents in multiple states.
Judges Joseph McLaughlin and Peter Hall, appointed by President George H.W. Bush and President George W. Bush, respectively, issued a 139-page opinion that essentially allows the plaintiffs to return their lawsuit against the power companies to a federal district court that had earlier dismissed the case.
Supreme Court Justice Sonia Sotomayor was the presiding 2nd Circuit judge on the case when it was argued in June 2006. But the court said in its opinion today that Sotomayor didn't participate in writing the climate opinion.
Plaintiffs had singled out the five companies and their subsidiaries for litigation in 2004 because they were the largest emitters of carbon dioxide from the power sector in the United States.
At the time of the lawsuit, the companies -- -- American Electric Power, Cinergy, Southern Co., Xcel Energy Inc., and the Tennessee Valley Authority -- produced a combined 650 million metric tons of carbon dioxide a year. That's about 25 percent of the 2.6 billion tons of CO2 created annually by the electric utility industry.
During the oral arguments, industry attorneys maintained that the plaintiffs lacked standing to even bring the case. They called for the lawsuit's dismissal on the grounds that it raised political questions better left to the other two government branches: Congress and the White House.
The power companies also insisted that federal common law had not been applied to an issue of such sweeping scale that covered all aspects of the U.S. economy. And they warned that the litigation would be a precursor to more global warming nuisance claims -- with no end in sight as plaintiffs ticked through other sources of greenhouse gas emissions.
But the 2nd Circuit rejected all lines of the industry's defense with an opinion that cites the closing lines of a 1972 Supreme Court decision that dealt with similar common law questions concerning air pollution that crossed state lines.
"It may happen that new federal laws and new federal regulations may in time pre-empt the field of federal common law of nuisance," the Supreme Court wrote in Illinois v. Milwaukee. "But until that time comes to pass, federal courts will be empowered to appraise the equities of the suits alleging creation of a public nuisance."
After the 2nd Circuit judges finished quoting the Supreme Court decision, they inserted the words "by greenhouse gases."
State officials who launched the case celebrated their win.
"This ruling restoring our legal action breathes new life into our fight against greenhouse gas polluters and changes the legal landscape to impose responsibility where it belongs," said Connecticut Attorney General Richard Blumenthal (D), who personally argued the case before the 2nd Circuit. "Our legal fight is against power companies that emit a huge share of our nation's CO2 contamination, but it will set a precedent for all who threaten our planet with such pernicious pollution. This ruling vindicates our tenacious and tireless battle on behalf of a powerful coalition of states and environmental advocates -- a battle that will now have its day in court."
New York Attorney General Andrew Cuomo (D) added, "This is a game-changing decision for New York and other states, reaffirming our right to take direct action against global warming pollution from power plants."
Environmental groups welcomed the decision. "No amount of stalling or obstructionism from opponents of federal action will keep emitters from being held accountable," said David Hawkins, director of the National Resources Defense Council's climate programs.
Hawkins added, "The import of this ruling is that failure of Congress or EPA to act on GHG will not immunize emitters from legal action to compel reductions in emissions."
Industry officials at Southern Co. and AEP declined comment on the merits of the ruling.
"It's a lengthy opinion, and we're currently reviewing it," said Valerie Hendrickson, a Southern Co. spokeswoman.
"As we've said since the suit was filed in 2004, litigation isn't the best approach to address climate issues," said AEP spokesman Pat Hemlepp. "It's a public policy issue, not a legal issue, and Congress is already working on a legislation to address climate concerns. We support the legislative approach."
The power companies will have the option of appealing the verdict to the Supreme Court. The states and environmentalists will push ahead for a trial in federal district court, though the timing on that remains uncertain.
"It's not going to be overnight," Hawkins said. "Things involving lawyers never are."
