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Manufacturers Won at the Supreme Court. Now What?

Last month, the U.S. Supreme Court handed a victory to energy manufacturers in one of several cases in which state and local governments are seeking to blame the manufacturers for the local impacts of global climate change. About two dozen lawsuits have been filed since 2017 as part of a highly coordinated climate litigation campaign. As the organizers have explained, their goal it to use litigation to raise energy prices on Americans and drive national energy policy.

In the case that went to the U.S. Supreme Court this year, the City of Baltimore had filed its lawsuit in Maryland state court. Like the other municipalities, Baltimore wants to avoid the federal courts. In 2011, the U.S. Supreme Court in American Electric Power v. Connecticut dismissed a similar climate case brought in federal court. The Supreme Court, in a ruling written by Justice Ruth Bader Ginsburg, explained that courts are not the appropriate places to make national energy policy on climate change. That job is for Congress and the Environmental Protection Agency.

What has resulted is a battle over where these newer cases can even be litigated—state or federal court. The first federal judge to decide this issue held these cases belong in federal court because they involve national energy policies over global climate change. Following American Electric Power v. Connecticut, he dismissed the case, saying the lawsuits do not present liability issues for courts at all, but policy questions for Congress and EPA. Other federal judges, including in the Baltimore case, have ruled the other way. They have said that because the cases are written as state law claims, they could go to state court, even if they are really targeting national energy policy.

All of these orders have been appealed to the U.S. Courts of Appeals, with several Circuits now weighing in. The threshold question that has vexed the Circuits in reviewing these orders is over the scope of their appellate review. The Circuits, including the Fourth Circuit hearing the Baltimore case, said they were hamstrung. The manufacturers presented multiple reasons the cases should be heard in federal court, but they believed they had the authority to review only one of those grounds—the one dealing with the federal officer removal statute.

The U.S. Supreme Court in BP PLC v. Mayor and City Council of Baltimore ruled 7-1 that the U.S. Courts of Appeals are not so limited. It clarified that Courts of Appeal can review all of the grounds that were included in the District Judges’ orders for whether the cases belong in federal or state court.

The impact of the Supreme Court’s ruling is already being felt. The Baltimore case was sent back to the U.S. Court of Appeals for the Fourth Circuit for a new ruling on whether the cases can be heard in state or federal court. This time, though, the Fourth Circuit will be able to consider all of the arguments. The same is true for the other cases.

At the end of the day, as the U.S. Supreme Court said back in 2011, ad hoc rulings in local courtrooms around the country are not the proper way to address this important global challenge. These lawsuits are a costly distraction from real efforts to solve climate change. As policymakers broadly recognize, moving forward requires major energy innovations so that we can use and source the world’s energy needs without impacting the climate. Lawsuits are not the answer, regardless of whether they are litigated in federal or state court.