NYC sues oil companies for the cost of adapting to climate change

Enlarge/ New York City has extensive knowledge of the risks posed by climate-driven sea-level rise.Patrick Cashin, MTA

Today, the city of New York joined a number of California cities in suing a group of major oil companies for the costs of climate change. The suit claims that these companies—by ignoring their own scientific experts and promoting the continued expansion of fossil fuel use—have created a public and private nuisance in addition to trespassing on city property. It seeks not only damages for past harms the city has suffered, but wants the oil companies to pay the cost of all the adaptation programs that it has had to start or plan.

In making the announcement, city officials announced they're putting their money where their lawsuit is. Over the next five years, New York City will divest its pension funds, which currently hold just under $200 billion dollars, from fossil fuel companies.

Creating a nuisance

New York City isn't the first to file suit against the oil companies. A number of California cities and counties, including San Francisco and Oakland, did so last year. Those suits targeted the same five companies named in the one announced today: Chevron, ConocoPhillips, ExxonMobil, BP, and Royal Dutch Shell. These are the five largest companies, and the suit estimates that they are collectively responsible for over 10 percent of the total greenhouse gasses that have accumulated in the atmosphere since the Industrial Revolution.

But they clearly weren't the only companies responsible for climate change. And, to a large extent, they simply supplied the fuels that were then combusted by other parties. So why should these five companies be held liable? New York's suit tackles this issue in a number of ways. Echoing some tobacco-related litigation, the city states that "This lawsuit is based upon the fundamental principle that a corporation that makes a product causing severe harm when used exactly as intended should shoulder the costs of abating that harm."

Beyond that, the suit makes heavy use of a variety of documents that have come to light over the last several years. Collectively, these show that the companies were well aware of the risks of harm from climate change and continued to cast doubt on the science publicly despite that.

"Disregarding the findings of their own internal scientists and scientific consultants, Defendants re-committed themselves to fossil fuel exploration, production, marketing, and sales over the ensuing decades," the suit claims. "The significant majority of emissions resulting from fossil fuels produced and marketed by Defendants occurred after Defendants became aware of the consequences of climate change."

To back this up, the suit cites the now-extensive documentation that several companies, notably Exxon, were aware of the growing scientific consensus about the role of carbon dioxide in the climate and even sponsored their own research that came to the same conclusions. The suit notes that all five defendants were members of the American Petroleum Institute, and thus received copies of an expert report that warned of "GLOBALLY CATASTROPHIC EFFECTS" this century and that "'THERE IS NO LEEWAY' in the time for acting." The science was so widely accepted within the companies, the suit argues, that they started designing and modifying their infrastructure to protect against the consequences of climate change, such as sea-level rise.

Despite their internal actions, the suit notes that the companies were simultaneously engaged in a PR campaign that downplayed our confidence in climate science. They contributed funding to a group called the Global Climate Coalition, which was telling the press that all the carbon emissions would be great for plant life even as internal documents admitted that it could "not offer convincing arguments against the conventional model of greenhouse gas emission-induced climate change."

As late as the year 2000, Exxon was taking out ads entitled "Unsettled Science" while funding scientists who cast doubt on mainstream science. Rex Tillerson, then-CEO and current Secretary of State, was still raising doubts about scientists in 2015, asking, "What if, [after] everything we do, it turns out our models were really lousy, and we achieved all of our objectives, and it turned out the planet behaved differently because the models just weren't good enough to predict it?"

Defining harms

So the legal theory seems to be that the companies were convinced of the harms internally but misled the public about them in order to continue with business as usual. That, New York argues, makes for direct harm against city property: "Global warming is already causing the City to suffer increased hot days, flooding of low-lying areas, increased shoreline erosion, and higher threats of catastrophic storm surge flooding even more severe than the flooding from Hurricane Sandy."

Included in these arguments are some interesting details. For example, the city already supports programs to help its residents during heat waves, which kill more New Yorkers than all other natural disasters combined—they're expected to get worse due to climate change. Extreme precipitation events are up 70 percent in the Northeast over the last 50 years, and these force the city to protect infrastructure like the subway from streets that simply can't drain fast enough. And sea levels that we're expected to reach later this century would mean a 100-year flood would inundate 97 percent of NYC's power generation capacity and 20 percent of its hospital beds. Parks, housing, and other infrastructure are also at risk.

The city has already paid for some of these issues after Hurricane Sandy and other less notable floods, and it's currently spending money to harden its infrastructure against similar events. There are additional programs that the city's staff also thinks are good ideas, but the money simply isn't available to pursue them.

All of those issues combine to create the three issues highlighted by the suit. It alleges the oil companies have created a public nuisance for the city: "Defendants' conduct constitutes a substantial and unreasonable interference with and obstruction of public rights and property, including the public rights to health, safety, and welfare of a considerable number of people who reside in and visit New York City." The private nuisance allegation comes about because the city owns some of the properties they have and will be damaged or that will need to be hardened to adapt to future climate.

Finally, the allegation of trespass is based on the idea that the companies are altering city properties without permission. Their conduct, the suit alleges, "was substantially certain to result in the invasion of property owned by the City, without permission or right of entry, by way of increased heat, sea level rise, storm surge flooding, and flooding from increased intensity and frequency of precipitation."

One of many?

What's the city want? It wants the costs it's already spent to protect its infrastructure, property, and residents. It also wants the oil companies to fund all the programs that will be necessary to protect the city against the further changes that climate change will bring. It wants to see its legal costs covered by the oil companies. And, if the companies don't pay up, they city would like to see the court order them to stop any activities that contribute to the alleged harms.

In many ways, the suit is similar to some of those brought in California, which also seek the current costs of building infrastructure that will protect against the near-inevitable future course of climate change. So far, none of the efforts has been tested in court. But simply by being filed, they pose a risk to the oil companies. The suits themselves are based largely on internal documents that have been leaked over the years. The process of discovery could potentially open up a much larger collection of internal communications, some of which might convince other communities that it's possible to build a case.

All of the communities that have acted so far are coastal and so have obvious issues due to climate-driven sea-level rise. But it's clear that climate-related issues are creating costs across the country, as communities deal with effects like melting permafrost, an extended wildfire season, and more. If any of the initial suits gain legal traction, then the oil companies could find themselves facing an endless sea of lawsuits.

New York City's decision to divest, in contrast, is a much smaller threat. Fossil fuels divestment will have to become much more widespread before oil company stocks are at risk of sudden price fluctuations.

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