WASHINGTON — The Supreme Court dealt a major setback to the oil industry on Monday, refusing to block lawsuits from California and other blue states that seek billions of dollars in damages for the impact of climate change.
Without a comment or dissent, the justices turned down closely watched appeals from Sunoco, Shell and other energy producers.
Justice Samuel A. Alito Jr. said he took no part in the decision, presumably because he owns stock in companies affected by the dispute.
In Sunoco vs. Honolulu, the energy producers urged the justices to intervene in these state cases and rule that because climate change is a global phenomenon, it is a matter for federal law, not one suited to state-by-state claims.
The decision means about two dozen states and municipalities may move forward to prove their claims that the major oil producers knew of the potential damage of burning fossil fuels but chose to conceal it.
Two years ago, California Gov. Gavin Newsom and Atty. Gen. Rob Bonta filed a lawsuit in San Francisco County Superior Court against five of the largest oil and gas companies — Exxon Mobil, Shell, Chevron, ConocoPhillips and BP — and the American Petroleum Institute for what they described as a “decades-long campaign of deception” that created climate-related harms in California.
“For more than 50 years, Big Oil has been lying to us — covering up the fact that they’ve long known how dangerous the fossil fuels they produce are for our planet,” Newsom said in announcing the suit.
California’s suit followed the pattern set by about two dozen similar claims from the cities of Baltimore, New York and San Francisco, and states led by Massachusetts and Rhode Island.
These suits argue that the oil producers used deceptive marketing to hide the danger of burning fossil fuels. Under state law, companies can be held liable for failing to warn consumers of a known danger.
Last month, lawyers for the Biden administration urged the court to stand aside for now because the suits are at an early stage.
The climate change lawsuits were patterned after the successful mass lawsuits filed by states and others against the tobacco industry over cigarettes and the pharmaceutical industry over opioids.
Cigarettes and opioids were sold legally, but the suits alleged that industry officials conspired to deceive the public and hide the true dangers of their highly profitable products.
Under state law, plaintiffs can seek damages for broad and open-ended claims like a failure to warn of a danger, false advertising or creating a public nuisance. All three claims are cited in California’s lawsuit. Federal law, by contrast, is usually limited to damage claims that are authorized by Congress.
Meanwhile, Alabama and 20 red states urged the court to throw out these blue-state lawsuits. They said liberal states and their judges should not have the power to set the nation’s policy on the energy industry. The court has not ruled on that claim yet.
The case Monday began five years ago when the city and county of Honolulu sued Sunoco and 14 other major oil and gas producers, alleging a failure to warn and creating a nuisance.
The Hawaii Supreme Court last year rejected the industry’s motion and refused to dismiss the suit.
“Simply put, the plaintiffs say the issue is whether defendants misled the public about fossil fuels’ dangers and environmental impact. We agree …. This suit does not seek to regulate emissions and does not seek damages for interstate emissions,” the state court said in a unanimous opinion. “Rather, plaintiffs’ complaint clearly seeks to challenge the promotion and sale of fossil-fuel products without warning and abetted by a sophisticated disinformation campaign.”
The justices said they will not hear Sunoco vs. Honolulu or Shell vs Honolulu.
