HONOLULU (Legal Newsline) - Arguments were heard Thursday at the U.S. Ninth Circuit Court of Appeals in a lawsuit that pits the City of Honolulu and the Island County of Maui against oil and gas companies, alleging the companies bear responsibility for degrading Hawaii’s environment from fossil fuels production and promotion.
Defense attorneys representing energy giants like Exxon argued that oil companies were simply fulfilling a need based on the national interest.
“These cases belong in federal court,” defense attorney Ted Boutrous with the Los-Angeles-based firm of Gibson Dunn told the three-judge panel. “The plaintiff complaints allege increased cost by global greenhouse gas emissions resulting from global gas and oil production and activities going back to the beginning of the industrial age.”
The case was streamed live on the Ninth Circuit Court website.
Lawsuits have been filed by other cities in similar cases contending that fossil fuel production, resulting carbon emissions and the greenhouse effect are damaging their climates. In Hawaii’s case, plaintiffs allege climate change has led to super storms, rising oceans and heat waves. The city’s lawsuit asks the oil companies to pay billions in damages to protect property, infrastructure and the island’s economy.
Attorneys for defendants also maintain that federal laws take precedence over the claims, not state courts, and that the oil companies were only doing what the federal government expected them to do—produce oil.
The companies also argue that having state courts decide issues of climate change fragments the process in a piecemeal way heeding their own state interests and narrow fact gathering, rather than a broad overall cohesive federal approach. They also contend the litigation is geared toward making gas and oil so expensive consumers will reduce their consumption.
In 2011, the U.S. Supreme Court rejected a case filed by the State of Connecticut against American Electric Power Co., ruling that state courts are not the proper venue for cases involving damages for climate change, rather that Congress and the Environmental Protection Agency (EPA) are more appropriate forums.
A number of cities and counties in California, including the City of San Mateo in the San Francisco Bay area, have filed suits alleging deliberate concealment by the oil producers of the dangers of their products. Oil companies removed to federal court under the "Federal Officer Removal" statute which allowsremoval if the entity being sued in state court is sued for actions taken under the direction of federal officials.
Oil companies maintain their production was based on contracts signed with the federal government.
In the case of San Mateo v. Chevron, a district court rejected the officer removal statute and remanded the case to a state court. The oil companies then appealed to the Ninth Circuit Court.
Last year the U.S. Court of Appeals Second Circuit rejected a similar case filed by New York City, saying such cases ignore the economic reality of the need for oil and gas, that individual state cases are basically the same, and that such lawsuits do nothing to address climate change.
A statement from the Second Circuit Court reasoned, “If the (oil) producers want to avoid all liability, their only solution would be to cease global production altogether.”
The Supreme Court asked the Ninth Circuit to consider all grounds for dismissal.
And, during Thursday’s hearing Boutrous asked the Ninth Circuit to reject the lawsuit.
“The (alleged) injuries are predicated on the defendants' oil and gas production on behalf of the federal government under the direction of federal officers and the Outer Continental Shelf, which is federal land governed by federal law and jurisdiction,” he said.
Boutrous said the Ninth Circuit and the Supreme Court both determined that the Federal Officer statute should be construed “liberally.”
“Removal (to federal court) is proper,” he said.
Boutrous said it was oil production that helped the U.S. win World War II.
He said 30% of supplies came from the Continental Shelf.
“The plaintiffs argue that the main driver of their injuries was the production of fossil fuels that were then consumed, then created emissions, that’s their theory," Boutrous said. "Their focus on misrepresentations, that’s not an element of their claims.”
Vic Sher, attorney for the plaintiffs with the Sher Edling law firm in San Francisco, said the oil companies had failed to warn the public of the dangers of the use of fossil fuels and had run a misleading promotion campaign to sell their products.
“Emissions from products that are incrementally contributing (global warming) because of the defendants’ deception campaign,” he said. “That’s our burden, that’s our theory of the case. It has nothing to do with going back to the dawn of the Industrial Revolution.”
He added that oil companies deceiving the public about the dangers of climate change continued over decades.
“The claim in this case is based on failure to warn, deception and a sophisticated disinformation campaign over decades,” Sher said. “There is not even a hint that the defendants were directed to take those actions by any federal actor, or that there’s any federal interest in protecting them from the consequences of behaving in this way. The federal government had no control over the failure to warn. The defendants have known for nearly half a century.
"They have nevertheless engaged in a coordinated multi-front effort to conceal and deny their own knowledge of the threats, to dismiss the growing body of evidence and create doubt in the minds of customers,” he added.
Sher said that without the defendants’ production, global warming impacts would be reduced.
Sher described the litigation as a case of a public nuisance, that the defendants sold fossil fuels they knew to be hazardous.
“It’s a big, important case but not a federal one,” he said.
However, Boutrous described the plaintiff’s case as “implausible.”
“Without the production of oil and gas and emissions from it, they don’t have a case,” Boutrous said. “It’s not about emissions it’s about misrepresentations, and the courts rejected it. Mr. Sher said World War II didn’t have anything to do with this case. During the war the production of oil and gas starts to spike up. It was consumption, to defend our national security in a World War and then the Cold War. That’s’ what the government needed. It commanded the oil companies to engage in these activities.”