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Why is Big Oil afraid of state courts?

The US Supreme Court dealt a blow to oil companies hoping to avoid facing mounting climate lawsuits

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Fossil fuels may face their day in court.
Fossil fuels may face their day in court.
Photo: Lucy Nicholson (Reuters)

For more than five years, oil companies have attempted to fend off climate change-related lawsuits by filing appeals to move the cases from state courts to the federal system. On Monday (April 24), the US Supreme Court dealt a blow to their efforts, ruling that the lawsuits should stay in the state courts where they were filed.

In recent years, more than 20 states and cities have sued oil companies over their roles in misleading the public about the impact of burning fossil fuels on climate change. This week’s decision is seen by climate law experts as a victory for the plaintiffs, as it clears a major hurdle for the cases to move forward.


The latest appeal in the Supreme Court was filed by ExxonMobil, Suncor Energy, and Chevron, asking for a change of venue for lawsuits by the state of Rhode Island and municipalities in Colorado, Maryland, California and Hawaii. The cases are premised on consumer fraud claims that aim to hold companies accountable for deceiving consumers—in this case, using the argument that the oil giants knew but were not forthcoming about the damaging impacts of burning fossil fuels.

The states and cities are seeking damages from the companies to help pay for the costs associated with rising seas, extreme heat, and other climate impacts.


The companies have dismissed the lawsuits as wasteful, arguing that climate policy should be dealt with at the federal level—an argument that multiple federal courts and the Department of Justice found to be spurious.

Why oil companies pushed hard to bring climate lawsuits into federal courts

One reason for the oil companies’ push has little to do with jurisdiction. Instead, it’s a tactic in a war of attrition. “The fossil fuel companies are trying to use every procedural tool available to them to try to slow these cases down and make them more expensive,” said Korey Silverman-Roati, climate law fellow at Columbia University’s Sabin Center for Climate Change Law.

Beyond that, the oil companies may have calculated that the cases were more likely to thrown out by federal courts on the grounds that they were attempts to regulate national emissions and supersede the Clean Air Act. The cases, however, are about whether the oil companies deceptively marketed their products despite knowing that they were dangerous and would cause harm to local communities, Silverman-Roati said. These are common law claims that state courts are used to hearing.

Once the cases are in state courts, there’s a real possibility that they will go to trial, thereby training a spotlight on oil companies that they may want to avoid.


“Big Oil companies have been desperate to avoid trials in state courts, where they will be forced to defend their climate lies in front of juries,” Richard Wiles, president of the advocacy organization Center for Climate Integrity, said in a statement following the Supreme Court decision.

And while the decisions of one state are not binding on another, states look at how others have ruled on a case to inform their own. There’s the potential for oil companies to face lawsuit after lawsuit as more states and municipalities file cases for monetary payments.


What’s next for the climate lawsuits?

Financial consequences for the oil companies are not imminent. The next step is for the oil companies to file motions to dismiss in state courts, and the cases are likely to jostle around the system for years before they go into discovery and trial.


If some of the more than 20 current cases against oil companies are victorious in state courts, “you could envision more cases being filed as more communities experience climate damages and have to pay billions of dollars to repair the climate harms,” Silverman-Roati said.

And mounting lawsuits in a warming world could snowball into “massive monetary liabilities,” as the oil companies themselves put it in their petition to the Supreme Court.