In recent months, the steady drumbeat of climate change litigation has grown increasingly louder as municipalities in California and New York have filed lawsuits against some of the historically largest companies in the oil and gas industry for their alleged contributions to climate change. The lawsuits claim that the production and refining activities of the defendants caused an increase in carbon dioxide and other greenhouse gases in the atmosphere, which contributed to climate change and in turn is causing—and will continue to cause—a rise in sea levels and an increase in heat waves. These lawsuits seek billions of dollars in damages to pay for current and future infrastructure projects that the municipalities claim are necessary to prepare for an evolving climate.

Some have analogized these lawsuits—and climate change litigation generally—to the half-century saga of tobacco litigation. This article provides an overview of the recently filed California and New York lawsuits, considers some of the key similarities and differences with tobacco litigation, and examines some of the strategies that climate change plaintiffs may use in the future.

Overview of Lawsuits

In August and September 2017, a number of California municipalities launched a series of lawsuits in California state court under tort theories—namely, nuisance, trespass, negligence and failure-to-warn laws. The lawsuits targeted over 20 of the historically significant oil and gas companies, along with the American Petroleum Institute and other industry associations. The municipalities advanced an “aggregation theory” of liability arguing that the defendants were collectively responsible for 20 percent of carbon dioxide emissions since 1965. The lawsuits claimed that, in the aggregate, these emissions would cause a rise in sea level over the next 80 years, inundating and damaging government property.

Similarly, in January 2018, New York City sued five of the historically largest “super-major” oil companies that allegedly account for 11 percent of man-produced greenhouse gases. The suit—filed in federal court and alleging state law tort claims—asserts that the defendants knew about the climate impact of greenhouse gases but deliberately hid this information from the public. New York City also seeks billions of dollars in damages to fund current and future infrastructure projects intended to curb property inundation from rising sea levels and to prepare the vity for likely heat waves.

Both suits remain in the early stages of litigation and neither has advanced to any consideration of the merits.

Tobacco Litigation

Tobacco litigation advanced in fits and starts. The first lawsuits against tobacco companies were filed in the 1950s as reports emerged linking cancer to tobacco use. Universally, tobacco companies prevailed in these suits. A second wave of lawsuits emerged in the 1970s and 1980s, following in the wake of the U.S. surgeon general's famous 1964 report on tobacco use and improvements in the scientific evidence linking cancer and bronchitis to smoking. On the whole, tobacco companies emerged from the second wave of litigation unscathed, relying on an “assumption-of-the-risk” defense and a coordinated public relations campaign.

The game changer for the plaintiffs in the tobacco litigation was Florida's revision of its tort laws to lower the hurdles for individual plaintiffs to prevail in lawsuits against tobacco companies. Numerous states quickly followed Florida's lead and enacted similar statutes, and within a matter of months, nearly all state attorneys general joined forces to launch a litigation campaign to recoup the rising health care costs associated with smoking. The litigation culminated in a nearly quarter-trillion-dollar settlement in 1998.

Comparing Climate Change and Tobacco Litigation

Climate change plaintiffs face many of the same legal hurdles that tobacco plaintiffs faced. In early tobacco lawsuits, plaintiffs—especially those who smoked different brands of cigarettes—had difficulty tracing their injuries to a specific manufacturer. Tracing carbon dioxide and other greenhouse gas emissions to a particular company is impossible. Once emitted into the atmosphere, emissions do not retain a signature that allows it to be traced to a specific emitter. Moreover, unlike tobacco litigation, where only a small handful of major tobacco manufacturers dominated the market, numerous companies and countries have been involved in the exploration, production, and refining of oil and natural gas.

Similarly, causation, especially expert causation, is particularly subject to conventional legal attacks. Although the science behind climate change has dramatically improved in the last 10 years, climate change plaintiffs, by their own admission, have widely varying projections about how much sea levels will rise in the future. For example, Marin County, a climate change plaintiff in California, relies on its own internal projections that sea levels will rise by somewhere between 16.6 and 65.8 inches by 2100. Such a significant gap in potential outcomes presents serious evidentiary problems for the plaintiffs' damages models.

To overcome these conventional legal hurdles, climate change plaintiffs may take a page from the tobacco litigation playbook by attempting to persuade state legislatures to enact lower causation standards. Indeed, model “climate compensation acts” have already been written. These statutes are designed to allow for “aggregation” causation theories, permit lower evidentiary standards, and allow for the allocation of liability based on market-share. Make no mistake, such legal changes could be a game-changer for climate change litigation just as they were for tobacco litigation. Energy companies should be vigilant of any such attempts to rewrite state tort laws.

Climate change litigation remains in its infancy, but given the lessons of tobacco litigation, it is likely to proceed much faster, particularly if states lower the applicable legal standards. As climate change plaintiffs—both private actors and governments—continue to look for companies with the resources to pay for future claims, energy companies would be wise to proactively formulate litigation and business strategies ahead of time to prepare for the coming battles.

David McCullough is a partner at Eversheds Sutherland (US) where he counsels producers, refiners, commodity traders and distributors on the trade and movement of commodities—particularly energy commodities such as crude oil, petroleum products and renewable fuels.

Garrett A. Gibson is an associate at the firm where he focuses on an array of complex business and commercial litigation matters, representing clients in state and federal courts at both the trial and appellate levels. He regularly assists with trial strategy and is well-versed in handling oil and gas, transportation, and commercial real estate disputes.