- “In the banking world, with which I am familiar, the general belief has been that you disobey supervisory guidance at your peril. That sounds like law and regulation, but without the open process and accountability. Over many years it has certainly felt that way.” [Wayne A. Abernathy, Federalist Society commentary]
- Some House Democrats use hearings to badger banks into cutting off clients in industry areas like guns, pipeline construction [Zachary Warmbrodt, Politico]
- New U.S. Chamber Institute for Legal Reform papers on reforming securities litigation: “Risk and Reward: The Securities Fraud Class Action Lottery” [Stephen J. Choi, Jessica Erickson, Adam C. Pritchard]; “Containing the Contagion: Proposals to Reform the Broken Securities Class Action System” [Andrew J. Pincus]
- “A pot banking bill is headed to House markup with bipartisan support” [Jim Saksa, Roll Call]
- Your periodic reminder that corporate law *is* a form of public interest law [Stephen Bainbridge quoting Hester Peirce]
- “History Shows Forcing Companies to Put Workers on Boards Is a Bad Idea” [Ryan Bourne, UK Telegraph/Cato, earlier on Elizabeth Warren proposals]
“A decade ago, the U.S. mandated the use of vegetable oil in biofuels, leading to industrial-scale deforestation — and a huge spike in carbon emissions.” A New York Times/ProPublica investigation by Abrahm Lustgarten. Excerpt:
In the mid-2000s, Western nations, led by the United States, began drafting environmental laws that encouraged the use of vegetable oil in fuels — an ambitious move to reduce carbon dioxide and curb global warming. But these laws were drawn up based on an incomplete accounting of the true environmental costs. Despite warnings that the policies could have the opposite of their intended effect, they were implemented anyway, producing what now appears to be a calamity with global consequences.
The tropical rain forests of Indonesia, and in particular the peatland regions of Borneo, have large amounts of carbon trapped within their trees and soil. Slashing and burning the existing forests to make way for oil-palm cultivation had a perverse effect: It released more carbon. A lot more carbon.
- Auto fuel economy standards: “The indirect CAFE program costs the economy at least six times as much as a carbon tax that reduces emissions equivalently.” [Peter Van Doren and Randal O’Toole, Cato]
- Whether grounded in official discretion or legislation, cash exactions levied on land development should still need to meet constitutional standards [Ilya Shapiro and Reilly Stephens on Cato Institute certiorari amicus brief in Dabbs v. Anne Arundel County]
- A stumbling block for Boulder: “With Two High-Profile Losses, When Do Climate Plaintiffs Start Worrying About Sanctions?” [Daniel Fisher; John O’Brien (views of former Colorado AG Gale Norton and current Colorado AG Cynthia Coffman); Adam Morey, New York Post] Issue isn’t whether climate change should be addressed, but what the Constitution and prudence tell us about whose job that is [Donald Kochan, L.A. Times] And a Federalist Society podcast with Kochan on municipal climate lawsuits;
- “Contract Dispute Cracks the ‘Thin Green Line’ Activists Are Drawing to Stop U.S. Fossil Fuel Exports” [Greg Herbers, Washington Legal Foundation, earlier]
- Neigh-ligence: latest effort to get courts to create standing for non-human plaintiffs is suit on behalf of neglected horse [Karin Brulliard, Washington Post/SFGate, earlier on animal rights]
- EPA announces intention to make regulatory science more transparent by making scientific work on which it relies open to public. Pressure groups erupt with outrage [Adam J. White, City Journal]
“Woman catches her shoe in groove in pavement at Tewksbury, Mass. gas station; she falls, is injured. Woman: The station had a duty to warn me of the danger, perhaps by painting the grooves (which are mandated by state law to contain spills) brightly. First Circuit: There is no such duty. But here’s a Judge Selya vocab quiz for your trouble: pellucid, behoof, animadversions, and rescript.” [John Kenneth Ross, Short Circuit on Potvin v. Speedway LLC]
- Organized efforts mount to blockade, shut down, and ban oil and gas infrastructure [David Roberts/Vox; Kevon Paynter] My two cents on Baltimore’s ban on new or expanded crude oil terminals, which follows moves against fuel infrastructure in Oakland and Portland [Free State Notes] Massachusetts judge approves “necessity defense” raised by protesters who blocked work on pipeline [Erin Mundahl, Inside Sources]
- Related: calls to ban hydrocarbon (even gas) utility generation stir backlash among some Democrats [Amy Harder, Axios] And not illogically given the distributional effects [Ronald Bailey, Reason]
- “$18 Billion Prize,” new stage play about Chevron/Ecuador case by Phelim McAleer and Jonathan Leaf, ruffles some Bay Area feathers [Daniel Kennard, National Review]
- Questions about curious study of GMO safety [Dan Vergano, BuzzFeed]
- “Creative Regulators and Environmental Protection,” Federalist Society panel video with C. Boyden Gray, Adam White, Robert Glicksman, Nathan Richardson, Caroline Cecot;
- Europe optimizes its train system for passengers, while U.S. optimizes its for freight. Which is the greener choice? [Coyote]
In a recent Cato Daily Podcast with Caleb Brown, Cato adjunct scholar Andrew Grossman of Baker & Hostetler discusses the “legally aggressive” new round of climate change litigation, in which municipalities in California and Colorado, as well as New York City, have sued energy producers and distributors seeking to recover damages over the release of carbon dioxide into the atmosphere.
As Grossman notes, the idea of suing over the role of carbon emissions in climate change has by this point been tried many times. The most obvious approach would be to sue large industrial emitters of carbon, which is what some state governments did in one of the most prominent cases, filed against electric utilities. In its 2011 AEP v. Connecticut decision, however, the Supreme Court ruled that such outputs were regulated comprehensively and exclusively at the federal level through enactments like the Clean Air Act, and were not subject to an additional level of state regulation through public nuisance claims. Suits on other theories, such as Comer v. Murphy Oilfrom the Fifth Circuit and the Kivalina case in the Northern District of California, have been launched “to enormous bombast and press attention and they have all bombed out…. Those cases were the low-hanging fruit. Those were the more obvious legal theories if you were going to try to bring this kind of case,” he says.
Now the question is whether litigants can accomplish an end run by instead attacking upstream, pre-emissions activity, specifically the extraction and distribution of fossil fuels destined to be burned. Ambitiously, some of the new suits attempt to apply state common law to activities occurring around the world – to the doings of worldwide corporations such as Royal Dutch-Shell, for example, and to oil production from places like the coast of Norway and its subsequent use by European motorists. Needless to say, many of these processes are comprehensively regulated by the laws of the European Union and its member countries. Doctrinally, then, the new efforts get into even deeper water (so to speak) than strictly domestic claims. From the podcast:
If a court in California is going to go around telling Norway what to do, well, gosh, Norway may not really like that. And what do you do in that instance? It’s not apparent to me how this works. How does the court figure out what Norway’s regulations are and what Norway is doing about this? Who’s going to tell them? I don’t know. What if Norway disagrees with whatever it is that the court decides needs to be done in this case? Does Norway complain to the court? Do they send an ambassador to file a brief or something? I don’t know. This has never happened before. And what if Norway decides that they don’t like whatever it is the court is doing and they’re going to impose, say, reciprocal trade tariffs, or something like that, against the United States on the basis of one of these rulings? Does the court hold them in contempt?
The litigation campaign had previously recruited several California cities and New York City, and now three local governments in Colorado, the City of Boulder, Boulder County, and San Miguel County, are joining in demanding recoupment of moneys spent because of climate change. I’m quoted in Michael Sandoval’s account in Western Wire:
Walter Olson, a Senior Fellow at the Cato Institute, told Western Wire that besides pushing for settlement, an additional objective is implementing new regulation via the courts, rather than legislation or administrative rulemaking….
The multi-state, multi-pronged approach is key, Olson said, given the differences between states on everything from recovery to discovery procedures.
“The strategy in these cases is typically to recruit as many plaintiffs as possible, with an emphasis on actions in different states. States have, e.g., different consumer laws to sue under that may allow different theories of recovery, or different procedures each of which may place the defendants at some particular kind of disadvantage,” Olson said….
“Typically the government plaintiffs are offered a deal of ‘no fee unless successful,’ just as in the ads on late-night TV,” Olson said….
Olson said that the approach in Colorado may be slightly different, given the reaction to the lawsuits filed in California and New York City that have been viewed simply as money-grabs.
“The first wave of these climate suits have gotten a reputation in the press as organized by law firms seeking contingency fees who intend to run the actions for maximum cash payout,” Olson said. “Involving EarthRights and a community like Boulder could be an effort to change this image by introducing more of an idealistic non-profit tone and maybe a suggestion that the goal isn’t just to squeeze money out in a settlement and then return to business as usual, which is basically what happened with the tobacco settlement,” he concluded.
I also mention that speculative litigation of this sort is made vastly easier by our lack of a loser-pays rule.
A very different view — and one with which, needless to say, I disagree — from the Niskanen Center, which is participating in the suits.
- Bay Area, L.A., and D.C. area should take an affordable housing lesson from cities that build: “Houston, Dallas, and NYC: America’s Great 3-Way Housing Supply Race.” [Scott Beyer]
- All things bright and beautiful/All creatures great and small/All things wise and wonderful/The Commerce Clause reaches ’em all [John-Michael Seibler, Heritage, on Supreme Court’s denial of certiorari in Tenth Circuit decision upholding as constitutional federal rules requiring owners to preserve Utah prairie dog habitat on private land; earlier on PETPO v. U.S. Fish & Wildlife Service here, here, and here] Photo: Wikimedia Commons;
- WSJ editorial takes dim view of Louisiana coastal erosion suit against oil firms, earlier here, here, here, here, here, and here;
- “You’re Not a Progressive If You’re Also a NIMBY” [Robert Gammon, East Bay Express] “Density Is How the Working Poor Outbid the Rich for Urban Land” [Nolan Gray, Market Urbanism] “The absence of gentrification causes displacement” [Michael Lewyn, same]
- “Let’s Make America a Mineral Superpower” [Stephen Moore and Ned Mamula, Bakersfield.com/Cato]
- Backing off from a bad law: Washington, D.C. considers ending tenant purchase rights for single-family homes [Carolyn Gallaher, Greater Greater Washington]
- Wearing two hats: mayor of Imperial Beach, Calif. suing oil companies is also with an environmentalist group [Ben Wolfgang, Washington Times] “Cross Examination Is Going To Be Brutal” given local officials’ earlier statements [Karen Kidd, Forbes, citing Richard Epstein]
- Municipalities’ suits ignore important goal of California law “that emissions should be reduced, not simply shifted out of state due to high costs and burdensome regulations” [Dorothy Rothrock (CMTA), Sacramento Bee]
- Washington Legal Foundation webinar on public nuisance suits with Richard Faulk of Davis Wright Tremaine LLP and Neil Merkl of Kelley Drye & Warren LLP;
- “Schwarzenegger to Sue Big Oil for ‘First Degree Murder’” [Edward Isaac-Dovere, Politico]
- “What is a non-mood-affiliated way to get up to speed on climate change issues?” [Tyler Cowen and commenters; brief Cowen explainer on mood affiliation]
- “Whether it is lawsuits against opioid manufacturers or lawsuits against oil companies, public policy should be crafted in the statehouse, not the courthouse.” [David Yates, Southeast Texas Record]