Here are highlights of this month's climate litigation update. The full update is available here:
Hawai‘i Supreme Court Rejected Oil and Gas Companies' Appeal of Denial of Motions to Dismiss Honolulu Climate Chase
The Hawai‘i Supreme Court affirmed a trial court’s denial of oil and gas companies’ motions to dismiss the City and County of Honolulu and Honolulu Board of Water Supply’s (Honolulu’s) common law claims seeking to hold the companies liable for allegedly deceptive marketing and failure to warn of the climate change impacts of their products. With respect to the motion to dismiss for lack of personal jurisdiction, the court concluded that the minimum contacts test for specific jurisdiction was satisfied. First, the court found that Honolulu’s claims “arise out of” or “relate to” the defendants’ sale and promotion of oil and gas in the state. Second, the court found that the seven-factor test for determining whether exercise of specific jurisdiction was reasonable weighed heavily in favor of concluding it was reasonable. In particular, the court found that Hawai‘i had a “significant interest” in providing its residents “with a convenient forum for redressing injuries inflicted by out-of-state actors.” Third, the court rejected the companies’ contention that due process also required “clear notice” that the defendants could be subject to specific jurisdiction. With respect to the companies’ motion to dismiss for failure to state a claim, the court held that neither federal common law nor the Clean Air Act preempted Honolulu’s claims. The court first concluded that because the Clean Air Act displaced federal common law claims regarding interstate pollution abatement and damages, the federal common law could not govern in this case and could not preempt Honolulu’s claims; only the Clean Air Act could preempt the claims. The court further found that federal common law preemption arguments would fail, even if federal common law was not displaced, because Honolulu did not seek to regulate emissions. The court also found that the defendants waived any argument seeking to expand federal common law to tortious marketing and that, in any event, such an argument would fail because regulation of marketing conduct is traditionally a state-governed area. Finally, the court held that the Clean Air Act did not preempt Honolulu’s claims under any theory of substantive preemption (express, field, or conflict). City & County of Honolulu v. Sunoco LP, No. SCAP-22-0000429 (Haw. Oct. 31, 2023)
Alaska Federal Court Upheld Federal Approvals for Willow Project, Rejecting Claims that Agencies Failed to Consider Climate Impacts
The federal district court for the District of Alaska dismissed environmental organizations’ claims that federal agency approvals in early 2023 of the Willow Master Development Plan—which authorized oil production on leases in the National Petroleum Reserve in Alaska (NPR-A)—violated the National Environmental Policy Act (NEPA), Endangered Species Act, and other federal statutes. The approved project consists of three drill sites and related infrastructure, including a processing facility, airstrip, operations center, gravel mine, gravel roads, and pipelines.
Under NEPA, the court found that the U.S. Bureau of Land Management (BLM) considered a reasonable range of alternatives, rejecting the plaintiffs’ contentions that BLM had based its selection of alternatives on a “purpose and need” statement that relied on a misinterpretation of BLM’s authority under the Naval Petroleum Reserves Production Act (NPRPA). The plaintiffs contended that BLM should have considered an alternative that “substantially reduces Willow’s carbon footprint” and prohibits infrastructure within the sensitive Teshekpuk Lake Special Area while also allowing production of some oil. The court held that the purpose and need statement’s framing of the authorization of NPR-A oil and gas production while providing for the protection of significant surface resources was reasonable and that BLM considered the requisite reasonable range of alternatives based on the purpose and need. In addition, the court rejected the plaintiffs’ assertion that BLM’s analysis of greenhouse gas emissions from reasonably foreseeable future actions failed to consider emissions from potential future development. The court noted that BLM’s final supplemental environmental impact statement (SEIS) incorporated prior analysis that included “low to high range of projected GHG emissions from future potential projects in the NPR-A” and therefore provided sufficient information about cumulative effects of greenhouse gas emissions from future development that could be induced by the Willow project even if the prior analysis did not include specific projections of downstream emissions from the potential “West Willow” or “Greater Willow” project. In addition, the court rejected the contention that BLM violated NEPA by excluding emissions from construction and routine operations of the West Willow project. The court characterized this exclusion as “inconsequential.”
Under the NPRPA, the court rejected the contention that BLM failed to consider a reasonable range of alternatives and arbitrarily limited its authority, citing the same rationale as it cited for upholding the NEPA alternatives analysis. The court found that the assertion that BLM violated NPRPA by failing to address the impact of the Willow Project’s greenhouse gas emissions on surface resources was “unpersuasive”; the court found that the plaintiffs did not causally link the project’s emissions to specific harms. Under the NPRPA, the court also found that BLM provided sufficient explanations for its rejection of specific measures that the plaintiffs claimed BLM had arbitrarily rejected: (1) a 20-year operating term instead of a 30-year term; (2) periodic review of NEPA analysis if more oil was recovered than anticipated; and (3) mitigation of greenhouse gas emissions through land reforestation.
Under Alaska National Interest Lands Conservation Act § 810, the court rejected the claim that BLM failed to consider alternatives that would reduce impacts to subsistence uses.
Under the Endangered Species Act (ESA), the court first concluded that the plaintiffs had standing to raise all their ESA claims, including claims regarding the ESA consultation on the project’s greenhouse gas emissions. On the merits of the ESA claim, the court concluded that the U.S. Fish and Wildlife Service’s (FWS’s) biological opinion (BiOp) was not arbitrary and capricious in its incidental take analysis of polar bears. The court also rejected the plaintiffs’ contention that BLM, FWS, and the National Marine Fisheries Service failed to consider the effects of Willow’s carbon emissions on protected species. The court upheld BLM’s determination that Willow’s greenhouse gas emissions were not an “effect of the action” under the ESA. In response to a plaintiff’s comment on the draft SEIS that suggested linking the project’s emissions and climate change-related effects to listed species and their critical habitat, BLM prepared a memorandum that stated that the project “is anticipated to result in a marginal increase in global GHG emissions that would contribute to climate change and, potentially, a marginal seasonal decrease in sea ice extent somewhere in the Arctic” but that “any generalized calculations of GHG impacts, such as sea ice loss, at this time would not be able to determine precise effects to individual animals and such consequences would not be reasonably certain to occur.” The court rejected the petitioners’ argument that BLM improperly required “precision” or “granularity” in the ability to predict effects. The court cited the regulations that prescribe criteria for determining what is an “effect of the action,” which provide that a consequence must be “reasonably certain to occur” based on “clear and substantial information.” The court found that BLM “used ‘precision’ and ‘granularity’ as characterizations of the causation issues with the scientific data” to conclude that the evidence was not “clear and substantial enough to render the impact of Willow’s GHG on listed species an ‘effect of the action.’” The court similarly found that FWS’s failure to specifically address the Willow Project’s greenhouse gas emissions in the BiOp was not arbitrary and capricious. The court noted that the BiOp had recognized the impacts of greenhouse gas emissions on climate change and climate change impacts on polar bears and their habitat. The court noted that FWS had acknowledged that “polar bears in the Action Area could become increasingly sensitive to disturbance or other impacts … indirectly associated with climate change” but had found that there was not “sufficient data to reliably predict how the effects of the proposed Action may or may not contribute to increased sensitivity.” In addition, the court cited FWS’s conclusion that climate science was “still insufficient to identify project-specific effects to listed species or designated critical habitat” and that “an estimate of a project-caused decrease in sea ice occurring somewhere in the Arctic, without more specific information … does not enable us to predict any ‘effects of the action’ to listed species or designated critical habitat.” Citing these statements, the court found that the federal agencies considered the relevant factors and articulated a rational connection between the facts and the conclusion that the Willow Project’s greenhouse gas emissions were not an “effect of the action” under the ESA. In addition, the court rejected a contention that FWS failed to consider the best available scientific and commercial data as required by the ESA when it failed to consider the project’s greenhouse gas emissions. The court found that the agencies had considered the scientific studies that plaintiffs contended should have been used to quantify the impacts of the project’s emissions on sea ice and polar bears and seals. But the court accepted the agencies’ conclusion that the studies did not enable them to predict “effects of the action” on listed species or their critical habitat. Sovereign Iñupiat for a Living Arctic v. Bureau of Land Management, No. 3:23-cv-00058 (D. Alaska Nov. 9, 2023)
Colombia: Colombian Courts Uphold Indigenous Rights to Informed Consultation on REDD+ Carbon Credit Project
In December 2022, 12 members of the Indigenous community “Gran Cumbal” in Nariño, Colombia, learned of the existence of a contract between the Indigenous community’s authority and SVP Business SAS to purchase carbon credits related to the REDD+ project “Pachamama Cumbal.” Plaintiffs assert the contract was negotiated without their knowledge, even though it would impact Indigenous territory. They argue that the Indigenous authority overreached their functions and that no information was shared with the community. In June 2023, plaintiffs filed a tutela alleging that the private companies involved in the contract and the associated REDD+ project failed to obtain their consent and violated their fundamental rights to free, prior and informed consultation (FPIC), active and effective participation in decision-making, territory as collective property, self-determination and environmental justice from an Indigenous perspective.
On July 21, 2023, the Juzgado Promiscuo Municipal de Cumbal, Nariño (trial level) found that the defendants had violated the plaintiffs’ rights by failing to conduct the FPIC process with the community concerning the contract associated with the REDD+ project. The judge granted a temporary injunction against the REDD+ project and the carbon credit contract and ordered the defendants to conduct an FPIC process within six months following the ILO Indigenous and Tribal Peoples Convention 169.
The decision highlights that these projects incentivize forest protection and aid in reducing GHG emissions. However, the lack of meaningful participation from the Indigenous community violated the plaintiffs` fundamental rights. More importantly, the judge underscored the blatant lack of information regarding the allocation of financial resources resulting from the purchase of carbon credits and asserted the Indigenous communities’ right to information. Hence, the judge ordered the defendants to hold a public hearing where they provide the Indigenous community with a detailed and clear financial report regarding resources from the REDD+ project and the purchase of carbon credits.
The defendants appealed the decision. On August 23, 2023, the Juzgado Tercero Penal del Circuito de Ipiales, Nariño (appellate level) upheld the lower court’s decision. The appellate judge gave the defendants two months to file the request for FPIC before the corresponding authority (Ministry of Interior). The Ministry then has six months to issue a decision on the matter. Members of Indigenous community “Gran Cumbal” v. SVP Business SAS, Global Consulting and Assessment Services SA, Deutsche Certification Body SAS, COLCX and the Indigenous authority of “Gran Cumbal” (Superior Court of Judicial Administration, Colombia)
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