FORT WORTH, Texas (Legal Newsline) – A conflicted Texas appellate court thinks climate change litigation pursued by private lawyers is “ugly” but ruled it is powerless to help ExxonMobil fight it.
The Second Appellate District ruled June 18 that it does not have jurisdiction over California cities and counties that are suing the energy industry over the alleged effects of climate change.
Part of Exxon’s defense was to ask a Texas court to allow it to conduct an investigation that would ultimately lead to a lawsuit against the governments and their lawyer Matt Pawa who, like other private lawyers who scored government clients, would earn a percentage of whatever they win.
A state court judge sided with Exxon, but the appellate court has reversed that.
“Because the potential defendants did not purposefully avail themselves of the privilege of conducting activities within Texas, they lack sufficient contacts for a Texas court to exercise specific jurisdiction,” the ruling says.
Exxon argued that the California cities and counties were basing their litigation on statements made by Exxon in Texas, where it is headquartered.
The court said it felt an impulse to protect the energy industry but could not retain jurisdiction on the case. It also criticized the cities and counties that have hired private lawyers instead of pushing for regulatory change.
“Lawfare is an ugly tool by which to seek the environmental policy changes the California Parties desire, enlisting the judiciary to do the work that the other two branches of government cannot or will not do to persuade their constituents that anthropogenic climate change (a) has been conclusively proved and (b) must be remedied by crippling the energy industry,” the ruling says.
“In the end, though, our reading of the law simply does not permit us to agree with Exxon’s contention that the Potential Defendants have the purposeful contacts with our state needed to satisfy the minimum-contacts standard that binds us.”
The appeal came after a Texas judge found the cities and counties were hypocritical in suing Exxon. They had claimed doom to their infrastructures will be caused by rising sea levels, but when issuing bond offers to potential investors, they had neglected to mention this alleged, near-certain destruction, the judge ruled.
During oral arguments, the California municipalities argued Texas lacks jurisdiction, as they do not conduct business in the state and if Exxon wished to conduct discovery, it could do so in the California litigation.
The cases of San Francisco and Oakland were dismissed by a federal judge who refused to impose new regulations on the industry, but the U.S. Court of Appeals for the Ninth Circuit vacated that ruling and sent those cases and other California cases back to the state courts in which they were filed.
Texas leads the nation in crude oil reserves and production and is home to more than one-third of all U.S. crude oil proven reserves, according to the U.S. Energy Information Administration.
Exxon argued the California climate change suits were crafted using a “playbook” to alter Big Oil’s viewpoint on climate change and “pressure the oil industry through litigation to change to renewable (energy).”
Climate change lawsuits, brought under the public nuisance theory, allege fossil fuel companies contributed to global warming-induced sea level rise and seek damages for past and future natural disasters, such as flooding.
Pawa, the Hagens Berman attorney named in Exxon’s petition, was purportedly instrumental in creating the “playbook” that includes efforts by the attorneys general of New York and Massachusetts.
Exxon believes Pawa promoted his playbook to California municipalities, urging them to become potential plaintiffs in tort litigation against energy companies.
Other governments around the country - like New York City, Baltimore and Boulder, Colo. - have filed their own cases. They seek compensation for costs associated with adjusting their infrastructures to the effects climate change.
The cases could find themselves subject to U.S. Supreme Court review soon.
The Texas appellate court decision uncovers the conspiracy to use the courtroom to change energy policy, said the Manufacturers’ Accountability Project.
“This is one of the rare rulings that is not important for the result, but for what the judges said about how these groups are trying to undermine the rule of law,” said MAP special counsel Phil Goldberg.