Supreme Court appears skeptical of energy companies in climate case

Chief Justice John Roberts and Neil Gorsuch showed skepticism over the arguments brought forth by Suncor and ExxonMobil. Roberts repeatedly questioned whether federal law or state law should apply in a case like this.

“We allow state courts in a particular state to bring litigation that affects it,” Roberts said. “[I’m] not quite sure what makes this situation different from those other ones.”

Gorsuch and Roberts both pointed to the high court’s legal precedent to argue that the source of law at issue in these cases should be based in the states at issue, not federal law. Gorsuch asked whether Texas state law could be used to regulate injuries caused in Colorado or any other state seeking damages.

Kannon Shanmugam, a lawyer for energy companies ExxonMobil and Suncor Energy, said Texas law should not apply for an injury in Colorado.

“Under equal sovereignty theory, Congress has authority to offset state law,” Shanmugam said. “As to emitters, you might be able to bring the claim under source state law. In this context of climate change, you cannot do that.”

Justice Samuel Alito recused himself from the case, meaning five of the other eight justices must agree with the energy companies in order to prevent Colorado’s lawsuit from moving forward. Shanmugam pointed out that energy companies across the country are facing similar climate change cases in more than 60 municipalities.

He said allowing the case to continue in Colorado, without federal law intervening, would greenlight all of those cases to move forward. 

“A state does not have the power to regulate out of state conduct based solely on the use of that out-of-state conduct,” Shanmugam said.

Justices Brett Kavanaugh and Amy Coney Barrett appeared to agree with Shanmugam. Both justices cited the Supreme Court’s previous rulings in environmental issues and federal common law to place responsibility in the case with the federal government, rather than state governments.

“This court has said four times that interstate air and water pollution are matters for federal inquiry,” Kavanaugh said.

However, Kavanaugh pointed to Vermont v. New York, a 1972 case where the high court allowed Vermont to move forward in a lawsuit against New York state over water pollution in Lake Champlain, as precedent that would go against Suncor Energy’s claims.

Shanmugam argued that the case before the high court is too different from Vermont v. New York, because it does not ask for the justices to regulate a specific pollution action rather all activities of an energy company.

“There is no case comparable to this one,” Shanmugam said.

Kevin Russell, a lawyer for Boulder County, argued that state law should apply in the case. He pointed to criminal cases where state law applies despite individuals being harmed across multiple states and localities.

“When lots of people act together to cause widespread harm, it is not uncommon for multiple defendants to be found liable,” Russell said.

Roberts pointed out, if the case moves forward, dozens of similar lawsuits could be brought forth against energy companies. Russell did not dispute whether more lawsuits would be brought against the companies. He declined to state how many could move forward.

Justice Clarence Thomas also pointed to an increased ability for state and local governments to file a lawsuit against the companies. He said those lawsuits could extend to retailers with potential contributions to climate change and drivers.

Russell argued that provisions in the dormant commerce clause, a constitutional principle that prevents states from passing laws that place restrictions on interstate commerce, and personal jurisdiction claims would still limit large climate lawsuits from moving forward.

“Since the founding, states have had the power to apply tort remedies to injuries occurring in their borders, even if that conduct occurs elsewhere,” Russell said.

In rebuttal, Shanmugam said 90% of greenhouse gas emissions Boulder County is seeking relief from occur outside of the United States. He said the lawsuit could extend to an individual filling their car with gas, due to alleged contributions to climate change that the gas collection required.

“The breadth of Boulder’s theory here is astonishing, there is no limit on who can be sued,” Shanmugam said. “There is simply no precedent for extending any state's authority as far as Boulder is suggesting.”

Shanmugam argued that Congress and the executive branch have balanced energy production and greenhouse gas emissions equally in considering limitations on the industries.

“This case and others like it reflect an all too regrettable trend of trying to resolve major political issues in court rather than leaving them to political branches where they belong,” Shanmugam said.

Hons van Spakovsky, a senior legal fellow at Advancing American Freedom, agreed with Shanmugam in a statement provided to The Center Square. 

"If [the U.S. Supreme Court] fails to overturn the Colorado state supreme court’s decision to allow Boulder’s state claim for supposed damage from 'global warming' to go forward, it will bankrupt the American energy industry and lead to massively negative economic consequences, including exorbitant fuel prices and shortages," van Spakovsky said. 

Justices on the high court are expected to consider the case over the next weeks and months. The court is expected to issue a ruling by July 2027.