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Monday, 19 November 2012 13:00

Ninth Circuit Affirms Dismissal of Climate Change Lawsuit Brought by Alaskan Native Village

The Ninth Circuit Court of Appeals closed the door last month on a five year effort by a coastal village in Alaska to use the common law of nuisance to fight climate change. In Native Village of Kivalina v. ExxonMobil,[1] the small town of Kivalina, located on the Chukchi Sea in Northwestern Alaska, alleged that the greenhouse gas emissions attributable to 22 oil, energy, and utility companies have exacerbated global warming and thereby exposed the village to rising sea levels and flooding. Relying on the Supreme Court's holdings in American Electric Power Co., Inc., v. Connecticut (AEP),[2] the Ninth Circuit dismissed the suit, holding that the Clean Air Act had displaced the federal common law of nuisance with respect to greenhouse gas emissions.

Efforts to address climate change via common law claims have met with little success. See Climate Change Lawsuits Get Chilly Reception, Marten Law Environmental News (June 19, 2012). While AEP and a host of other recent decisions have made clear that the Clean Air Act displaces climate change nuisance actions, the Kivalina plaintiffs attempted to distinguish their case based on the remedy they were seeking. While prior unsuccessful climate change nuisance cases have involved efforts to abate greenhouse gas emissions, the Kivalina plaintiffs sought compensation for the costs needed to relocate their village to a sheltered inland location. According to Kivalina, the Clean Air Act may have displaced efforts to enjoin greenhouse gas emissions, but it did not displace suits for monetary damages. The Ninth Circuit was unconvinced, holding that once a federal common law claim is displaced by statute, such "displacement is extended to all remedies."

The court was sympathetic to Kivalina's plight, but observed that "the solution to Kivalina's dire circumstances must rest in the hands of the legislative and executive branches of our government, not the federal common law."

Kivalina makes clear that federal courts will be very reluctant to consider common law claims pertaining to greenhouse gas emissions, regardless of the relief sought. As noted in a concurring opinion, however, parties are not without a remedy because state law nuisance actions may remain available to the extent they are not themselves preempted by federal legislation. Indeed, the trial court in Kivalina declined to exercise jurisdiction over Kivalina's state-law nuisance claims, and the concurrence notes that Kivalina is free to refile those claims in state court.

I. Background

A. U.S. District Court for the Northern District of California Dismisses the Plaintiffs' Claims.

The Native Village of Kivalina is located on the tip of a low-lying barrier island on the Chukchi Sea – approximately eighty miles north of the Arctic Circle. The village's four hundred residents are primarily members of a federally-recognized tribe of Native Alaskans. The village, which has a maximum elevation of ten feet above sea level, is significantly threatened by flooding from storm surges. According to the U.S. Army Corps of Engineers, environmental changes associated with global warming have exacerbated flooding and erosion threats to Kivalina and other coastal villages in the Arctic. Specifically, the Corps noted that sea ice, which offers seasonal protection from storm surges, has been forming later and melting earlier since the early 1980s. As a result, the village is increasingly exposed to winter storms which are increasing in severity and frequency. In 2006, the Corps noted that the situation in Kivalina is "dire" and that the entire town must be relocated within six years. The Corps estimated that relocating the entire village would cost between $123 million and $249 million. The U.S. Government Accountability Office estimated that the relocation would cost between $100 and $400 million.

In 2008, the Native Village of Kivalina and the City of Kivalina filed a lawsuit in the United States District Court for the Northern District of California. The complaint alleged that greenhouse gas emissions from 22 oil, energy, and utility corporations are directly responsible for "large quantities of carbon dioxide" from sources including: petroleum exploration, development, and production; petroleum refining, processing, and distribution; coal mining; power generation; natural gas transmission; specialty chemical production; and metal production. The plaintiffs sought compensation from the defendants on grounds that their greenhouse gas emissions constituted a substantial and unreasonable interference with public rights, including the public and private property in Kivalina. In addition to their federal nuisance claims, the plaintiffs also alleged that the defendants had acted in concert to create, contribute to, and maintain global warming and had conspired to mislead the public about the science of global warming.

In 2009, the Northern District of California dismissed the plaintiffs' lawsuit on grounds that the claims presented a nonjusticiable political question.[3] The court reasoned that, in order to resolve the claims, it would be required to determine: (1) an acceptable limit on greenhouse gas emissions; and (2) who should bear the costs of global warming. According to the court, such questions should be resolved by the executive or legislative branches, rather than the judiciary. In the alternative, the court ruled that the plaintiffs lacked standing to pursue their public nuisance claims because they could neither demonstrate a "substantial likelihood" that defendants' conduct caused their alleged injury, or that the alleged injury was "fairly traceable" to the defendants.

B. The Supreme Court's Holdings in AEP

While the Kivalina appeal was pending before the Ninth Circuit, the Supreme Court issued its opinion in AEP, which involved claims similar to those in the Kivalina case. The plaintiffs in AEP, including eight states, the City of New York, and three private land trusts, brought a lawsuit alleging that the greenhouse gas emissions attributable to four private electric utilities and the Tennessee Valley Authority constituted a public/interstate nuisance under the federal common law. In 2005, the U.S. District Court for the Southern District of New York dismissed the lawsuit, ruling that it presented a non-justiciable political question.[4] See District Court Judge Dismisses State's Global Warming Lawsuit, Marten Law Environmental News (Oct. 19, 2005). The Second Circuit reversed in 2009, holding that the claims had political implications, but were nonetheless justiciable in the federal courts.[5] Central to the Second Circuit's holding was the fact that, at that time, neither Congress nor EPA had enacted legislation or regulations governing greenhouse gas emissions that displaced public nuisance claims relating to such emissions. See Second Circuit Allows Federal Nuisance Claims for Global Warming to Proceed, Marten Law Environmental News (Sept. 23, 2009).

The Supreme Court, however, disagreed, and held in AEP that the plaintiffs' public nuisance claims were displaced by the Clean Air Act. The Supreme Court rejected the Second Circuit's reasoning that federal common law is not displaced until EPA actually exercises its regulatory authority. Instead, the question for displacement purposes is "whether the field has been occupied, not whether it has been occupied in a particular manner." The Supreme Court concluded that, in the wake of Massachusetts v. EPA,[6] Congress had indeed delegated to EPA the decision of whether and how to regulate greenhouse gas emissions from power plants:

We hold that the Clean Air Act and the EPA actions it authorizes displace any federal common law right to seek abatement of carbon-dioxide emissions from fossil-fuel fired power plants. Massachusetts made plain that emissions of carbon dioxide qualify as air pollution subject to regulation under the Act. And we think it equally plain that the Act "speaks directly" to emissions of carbon dioxide from the defendants' plants.[7]

As detailed below, the Supreme Court's holdings in AEP formed the basis for the Ninth Circuit's conclusions in Kivalina.

II. The Ninth Circuit Affirms Dismissal of Kivalina's Claims

In the Kivalina appeal, the Ninth Circuit conducted a two-part analysis. The court first addressed the threshold issue of whether, in the first instance, public nuisance claims are viable under the federal common law. The court observed that although the Supreme Court's decision in Erie Railroad Co. v. Tompkins[8]purportedly rendered the federal common law extinct, federal common law claims still exist when Congress expected federal courts to develop a federal common law under a particular statute (e.g., ERISA), or when courts must address federal questions that are not answered by statutes. The court noted that the post-Erie federal common law included the general subject of environmental law, including "ambient or interstate air and water pollution."[9] More specifically, the court held that "federal common law can apply to transboundary pollution suits" (such as Kivalina's claims), and that such suits are generally "founded on a theory of public nuisance."[10] In order to prevail on a public nuisance claim, the plaintiffs must demonstrate that "a defendant's activity unreasonably interfered with the use or enjoyment of a public right and thereby caused the public-at-large substantial and widespread harm."[11]

Although the Ninth Circuit recognized that public nuisance claims may arise under the federal common law, it also held that the right to assert such claims is limited – "when federal statutes directly answer the federal question [presented in a public nuisance claim], federal common law does not provide a remedy because legislative action has displaced the common law."[12] Put another way, "[f]ederal common law is used as a necessary expedient when Congress has not spoken to a particular issue."[13]

As announced by the Supreme Court in AEP, "[t]he test for whether congressional legislation excludes the declaration of federal common law is simply whether the statute speak[s] directly to [the] question at issue."[14] The Ninth Circuit noted that the application of that test "can prove complicated," and that determining whether a claim has been displaced by statute "is an issue-specific inquiry."[15] "The salient question is whether Congress has provided a sufficient legislative solution to the particular [issue] to warrant a conclusion that [the] legislation has occupied the field to the exclusion of federal common law."[16]

The Ninth Circuit determined that it was unnecessary to "engage in that complex issue and fact-specific analysis ... because we have direct Supreme Court guidance."[17] Specifically, the Supreme Court in AEP had already held that the regulation of greenhouse gas emissions under the Clean Air Act had displaced the federal common law with respect to such emissions.[18]

In order to counter arguments that its claims had been displaced by the Clean Air Act, Kivalina attempted to distinguish its requested relief from the relief sought in AEP. Kivalina acknowledged that nuisance lawsuits seeking to abate greenhouse gas emissions are displaced by the Clean Air Act, but argued that its claim for monetary compensation was not. The Ninth Circuit rejected that argument, holding that the type of relief requested was irrelevant to the analysis:

[D]isplacement of a federal common law right of action means displacement of remedies. Thus, AEP extinguished Kivalina's federal common law public nuisance damage action, along with the federal common law public nuisance abatement actions.[19]

Kivalina also argued that its claims were not displaced because the damages occurred before EPA had actually adopted enforceable greenhouse gas emissions standards. The Ninth Circuit rejected this argument, observing that Congress had, through the Clean Air Act, empowered EPA to regulate greenhouse gas emissions, even if the agency had not yet adopted applicable regulations – "Congressional action, not executive action, is the touchstone of displacement analysis."[20]

The Ninth Circuit concluded that "federal common law addressing domestic greenhouse gas emissions has been displaced by Congressional action. That determination displaces federal common law public nuisance actions seeking damages, as well as those actions seeking injunctive relief."[21] Because the plaintiffs did not present a justiciable claim, the Ninth Circuit found it unnecessary to address the issue of standing. The court also declined to address Kivalina's civil conspiracy claims on grounds that they fell with the substantive claim.[22]

III. Judge Pro's Concurrence

Sitting by designation, U.S. District Court Judge Philip M. Pro[23] wrote a concurring opinion in which he further explored the "tension in Supreme Court authority on whether displacement of a claim for injunctive relief necessarily calls for displacement of a damages claim."[24] But the most potentially significant aspect of Judge Pro's concurrence is his discussion of standing – an issue avoided in the majority opinion. Specifically, Judge Pro opined that the plaintiffs "had not met the burden of alleging facts showing [it] plausibly can trace their injuries to Appellees."[25] Referencing Kivalina's complaint, Judge Pro explained:

By Kivalina's own factual allegations, global warming has been occurring for hundreds of years and is the result of a vast multitude of emitters worldwide whose emissions mix quickly, stay in the atmosphere for centuries, and, as a result, are undifferentiated in the global atmosphere. Further, Kivalina's allegations of their injury and traceability to Appellees' activities is not bounded in time. Kivalina does not identify when their injury occurred nor tie it to Appellees' activities within this vast time frame. Kivalina nevertheless seeks to hold these particular Appellees, out of all the greenhouse gas emitters who ever have emitted greenhouse gases over hundreds of years, liable for their injuries.[26]

Judge Pro also distinguished the Supreme Court's conclusion in Massachusetts v. EPA that the State of Massachusetts had standing to challenge EPA's failure to regulate greenhouse gas emissions from motor vehicles. The Supreme Court reached that conclusion based, in part, upon the fact that states have "special solicitude" to grieve their cases in federal court on behalf of their citizens, and that Congress had provided states with a procedural right under the Clean Air Act to challenge EPA's decision to not regulate greenhouse gas emissions. Judge Pro, however, opined that:

It is one thing to hold that a State has standing to pursue a statutory procedural right granted to it by Congress in the [Clean Air Act] to challenge the EPA's failure to regulate greenhouse gas emissions which incrementally may contribute to future global warming ... It is quite another to hold that a private party has standing to pick and choose amongst all the greenhouse gas emitters throughout history to hold liable for millions of dollars in damages.[27]

IV. Conclusion

Kivalina may be the last blow for parties that are seeking to address climate change via the federal common law. The opinion makes clear that both abatement actions and monetary damage actions pertaining to greenhouse gas emissions have been displaced by the Clean Air Act. Public nuisance litigation will likely turn to the states, although efforts to address climate change via state common law have been unsuccessful (at least so far). See Climate Change Lawsuits Get Chilly Reception, Marten Law Environmental News (June 19, 2012). Courts have repeatedly held that efforts to address climate change through the public trust and other common law doctrines present nonjusticiable political questions that courts lack jurisdiction to resolve. Furthermore, there is a distinct possibility that the displacement holdings in AEP and Kivalina would apply with equal force at the state level, since states are generally empowered to enforce the Clean Air Act.

Perhaps the most significant aspect of the Kivalina case is Judge Pro's discussion of standing. While not part of the court's majority opinion, that discussion is likely to be cited in support of efforts to dismiss other lawsuits attempting to address climate change via the common law or other theories.

[1] No. 09-17490, 2012 WL 4215921 (9th Cir. Sept. 21, 2012).

[2] 131 S. Ct. 2527 (2011).

[3] Native Village of Kivalina v. ExxonMobil Corp., 633 F. Supp. 2d 863 (N.D. Cal. 2009).

[4] Connecticut v. Am. Elec. Power Co., Inc.,406 F. Supp.2d 265 (S.D.N.Y. 2005).

[5] Connecticut v. Am. Elec. Power Co., Inc., 582 F.3d 309 (2d Cir. 2009).

[6] In Massachusetts v. EPA, the Supreme Court held that greenhouse gas emissions "fit well within the [Clean Air Act's] capacious definition of air pollution" and that "EPA has the statutory authority to regulate emissions of such gases.... " 549 U.S. 497, 532 (2007).

[7] AEP, 131 S. Ct. at 2537.

[8] 304 U.S. 64 (1938).

[9] Slip Op. at 11652.

[10] Id.

[11] Id.

[12] Id. at 11653.

[13] Id. (internal citations and quotations omitted).

[14] Id. (quoting AEP, 131 S. Ct. at 2537).

[15] Id.

[16] Id. at 11654 (internal quotations and citations omitted).

[17] Id.

[18] Id.

[19] Id. at 11655.

[20] Id. at 11656.

[21] Id. at 11657.

[22] Id.

[23] U.S. District Court of Nevada.

[24] Slip Op. at 11658.

[25] Id. at 11675.

[26] Id.

[27] Id. at 11675-76 (internal citations omitted).

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