Thought Piece

The Climate-Change Tort Racket: Liberal cities join the contingency-fee bar to shake down oil firms. I had another nightmare last night about Global Warming (aka Climate Change), that US cities started suing national and international energy companies on the thinnest of legal precedent. Then, I woke up and remembered that San Francisco, Oakland, New York and Seattle had already begun legal action against energy companies. In the name of Climate Change, over 5,000 environmental lawsuits are currently active in the US, with enough environmental attorneys on contingency to strain the entire US legal system. Counter-intuitively, Climate Change supplies the rationale for billions of dollars in donations and government grants annually to help fund many of these frivolous and bad faith lawsuits. In fact, it has provided a “moral superiority” for many groups of environmental activists (in and out of government) throughout the world. Ultimately, it may allow a small cabal of environmental zealots to simply delay and/or overwhelm the legal system itself.

The Climate-Change Tort Racket

Liberal cities join the contingency-fee bar to shake down oil firms.

San Francisco, Oakland, New York and Seattle have sued five global oil giants—BP, Chevron, ConocoPhillips , ExxonMobil and Royal Dutch Shell —for billions in future damages from climate change. Brass-knuckled plaintiff firm Hagens Berman Sobol Shapiro has been shopping around the lawsuit to other cities desperate for cash.

No court has recognized common-law claims for injuries supposedly caused by climate change, and the Supreme Court unanimously ruled in AEP v. Connecticut (2011) that the Clean Air Act pre-empts public nuisance torts against corporations for greenhouse-gas emissions. So the cities are now arguing that the mere production and promotion of fossil fuels create a public nuisance, and the suits are heading to court.

San Francisco and Oakland were counting on a home courtroom advantage with their choice of legal venue given that climate change is something of a religion in California. But Clinton-appointed federal Judge William Alsup is calling fouls as he sees them.

“We won the Second World War with fossil fuels. If we didn’t have fossil fuels, we would have lost that war and every other war,” the judge mused during a recent hearing. “And so we have gotten a huge benefit from the use of fossil fuels, right?” Plaintiff attorney Steve Berman agreed.

Judge Alsup also pointed out that the federal government and states have encouraged the production of fossil fuels. “If the nation is saying, ‘please do it,’ how can we hold them liable for that?” he asked.

The cities’ ostensible trump card was a document purporting to show that the oil companies concealed evidence that they knew for decades that fossil fuels contribute to global warming. But as the judge noted, this “smoking gun” was merely a “slide show that somebody had gone to the [United Nations Intergovernmental Panel on Climate Change] and was reporting on what the IPCC had reported, and that was it. Nothing more.”

When Judge Alsup asked for an example of an out-of-pocket cost that San Francisco has paid due to climate change, Mr. Berman replied: “We have people that we’ve had to employ, outside consultants, to study global warming. Had to hire them to figure out how high the sea wall should be.”

Even this was contradicted by a 2017 San Francisco general-obligation bond document that says “the City is unable to predict whether sea-level rise or other impacts of climate change or flooding from a major storm will occur.” If Mr. Berman is right, then the Securities and Exchange Commission should prosecute San Francisco for a fraudulent bond offering.

Hagens Berman, which has negotiated a 23.5% contingency fee in the San Francisco and Oakland cases, is hoping the oil giants will pay to make the lawsuits go away, which may be tempting as cases pile up. Federal Judge John Keenan is reviewing a motion to dismiss New York City’s lawsuit on June 13. But by fighting the lawsuits, the companies are giving the public a valuable education in the monetary self-interest behind climate-change politics.