Ninth Circuit affirmed a California district court’s dismissal of a public nuisance suit seeking damages on the ground that greenhouse gases emitted by energy, oil and utility companies caused global warming and destroyed plaintiffs’ land. Kivalina v. ExxonMobil Corp., 2012 WL 4215921 (9th Cir. Sept. 21, 2012). The court reasoned that federal statutory law, including the Clean Air Act, displaced federal common law in this context and thus precluded plaintiffs’ nuisance claims. In reaching its decision, the court relied primarily on American Electric Power Co., Inc. v. Connecticut, 131 S. Ct. 2527 (2011), in which the United States Supreme Court dismissed similar global warming claims on the basis that “the Clean Air Act and the EPA actions it authorizes displace any federal common law right to seek abatement” of greenhouse gas emissions. (For a full discussion of American Electric Power, click here). The Ninth Circuit reasoned that American Electric Power applied squarely to Kivalina, even though plaintiffs sought money damages and the American Electric Power plaintiffs sought only injunctive relief. The court explained that “the type of remedy asserted is not relevant to the applicability of the doctrine of displacement.” These rulings, taken together, appear to foreclose the use of federal common law as the basis for climate change nuisance suits.
Notably, the insurance coverage action that arose from the Kivalina suit was dismissed earlier this year. The Virginia Supreme Court ruled that a general liability insurer did not owe defense or indemnity for Kivalina’s global warming-related claims. AES Corp. v. Steadfast Ins. Co., 283 Va. 609, 725 S.E.2d 532 (2012). The court reasoned that because Kivalina’s complaint alleged damages which were “the natural and probable consequence[ ] of AES’s intentional emissions,” there was no accidental “occurrence” for insurance coverage purposes. See October 2011 and May 2012 Alerts.