Sinking Against a Rising Tide

Leigh Jones

Corporate Counsel

11-01-2012

Residents of an Alaskan village threatened by an eroding coastline have lost an appeal in a closely watched case against some of the biggest oil producers in the world.

In September the U.S. Court of Appeals for the Ninth Circuit found that the village of Kivalina could not recover money damages from ExxonMobil Corp., BP America Inc., Chevron Corp., and other energy companies for greenhouse gas emissions that the plaintiffs said threaten the destruction of their coastal towns.

The plaintiffs alleged that the emissions caused by the companies' products had eroded sea ice that hugs the village's coastline and protects it from powerful winter storms. They claimed that the entire village of 400—97 percent of them Inupiat Native Alaskans—needed to move to survive. The potential cost was estimated to be up to $400 million.

A three-judge panel affirmed a ruling by the U.S. District Court for the Northern District of California. In the opinion, Judge Sidney Thomas wrote that the villagers could not sue under the tort theory of public nuisance nor obtain monetary damages. A public nuisance claim under federal common law was precluded, or "displaced," he said, by the federal Clean Air Act. That statute allows for lawsuits by private parties under limited circumstances.

In reaching its decision, the court relied on a case decided last year by the U.S. Supreme Court. In American Electric Power Co. (AEP) v. Connecticut , the justices held that the Clean Air Act, instead of nuisance claims, provided a way to stop the energy companies from emitting greenhouse gases. Plaintiffs in the case included the city of New York and eight states. The Ninth Circuit panel ruled similarly, even though the Kivalina plaintiffs sought monetary damages as opposed to the injunction at issue in the Supreme Court case.

"The Supreme Court has held that federal common law addressing domestic greenhouse gas emissions has been displaced by congressional action," Thomas wrote. "That determination displaces federal common law public nuisance actions seeking damages, as well as those actions seeking injunctive relief."

Other defendants in the case included ConocoPhillips, Royal Dutch Shell, the AES Corp., Duke Energy Corp., and Edison International. —Leigh Jones