CLIMATE CHANGE COMMON LAW NUISANCE SUITS: A LEGAL-EFFICIENCY ANALYSIS.

• Author: Flatt, Victor

1. INTRODUCTION 684 II. NUISANCE LAW AND THE DAMAGE FROM GREENHOUSE GAS EMISSIONS 686 III. THE ROLE OF ECONOMIC EFFICIENCY IN NUISANCE LAW 690 IV. NUISANCE LAWSUITS IN CLIMATE CHANGE CREATE EFFICIENT OUTCOMES UNDER ALL CIRCUMSTANCES 691 V. DAMAGE CALCULATIONS 697 VI. CONCLUSION 700 I. INTRODUCTION

   Like the frog in the slowly heating water, we have proved unable to respond well to the long-term threat of climate change to the point where the threat now may be a short term one. The problem was well summarized by Nathaniel Rich for the New York Times Magazine:

   The world has warmed more than one degree Celsius since the Industrial Revolution. The Paris climate agreement--the nonbinding, unenforceable and already unheeded treaty signed on Earth Day in 2016--hoped to restrict warming to two degrees. The odds of succeeding, according to a recent study based on current emissions trends, are one in 20. If by some miracle we are able to limit warming to two degrees, we will only have to negotiate the extinction of the world's tropical reefs, sea-level rise of several meters and the abandonment of the Persian Gulf. The climate scientist James Hansen has called two-degree warming "a prescription for long-term disaster." Long-term disaster is now the best-case scenario. Three-degree warming is a prescription for short-term disaster: forests in the Arctic and the loss of most coastal cities. Robert Watson, a former director of the United Nations Intergovernmental Panel on Climate Change, has argued that three-degree warming is the realistic minimum. Four degrees: Europe in permanent drought; vast areas of China, India and Bangladesh claimed by desert; Polynesia swallowed by the sea; the Colorado River thinned to a trickle; the American Southwest largely uninhabitable. The prospect of a five-degree warming has prompted some of the world's leading climate scientists to warn of the end of human civilization. (1) The toughest emissions reductions being proposed, even by the most committed nations, will probably not be able to achieve any given global temperature stabilization target. (2) By increasing the amount of greenhouse gasses (GHGs) in the atmosphere, we are passing on a huge remediation burden (externality) to future generations that may have no solution. Given this situation, should we not aggressively seek measures to reduce our present and future risks, including the use of private and public nuisance cases?

   As Frank Mahoney noted about forty-six years ago, there is a tendency to look to the legislatures for environmental remedies and to overlook or underrate the potential of common law to contribute to solving such problems. (3) Courts have a role to play and can contribute to a reduction of the huge damages from climate change, as well as reduce the potential for catastrophic risks, by allowing a cause of action based on public nuisance common law, rooted in strict liability, combined with a damage remedy adopting calculations based on current knowledge. (4) The damages should be a yearly assessment in order to produce a proper incentive for emission reduction and, most importantly, related technological change.

   While federal common law nuisance suits for injunctive relief for greenhouse gas emissions are blocked by the Supreme Court's decision in American Electric Power Co. v. Connecticut (5) (American Electric Power Co.), on grounds of preemption under the Federal Clean Air Act, lawsuits for damages at the state level may be in play. (6)

   There are significant efficiency advantages to damages granted under strict liability for nuisance in the form of creating incentives for innovation and the search for alternative technologies. Suits brought by states, government subdivisions, and even private parties under common law nuisance law should be allowed to establish these damages. Many of the recent suits by cities establish damage that is not speculative as it is based on the cost of future adaptation efforts made necessary by climate change. (7) Even more generalized damages could be calculated from Environmental Protection Agency (EPA) generated information or other government calculations such as the social cost of carbon or some variant thereof. (8) While injunctive relief in nuisance lawsuits brings up difficult questions regarding the role of courts in GHG regulation, lawsuits for past, future, and ongoing damages, in lieu of an injunction, could be an appropriate remedy and impact the arc of future emissions. (9)

   Our paper demonstrates that common law public nuisance suits to reduce emissions through damage claims are economically efficient under all conditions and scenarios. This provides a powerful argument for recognizing GHG emissions damages as cognizable under state law, even when there is a federal regulatory scheme. This economic proof also calls into question some prior case law rejecting both public and private nuisance law suits for GHG emissions. Outside of an explicit preemption of state law, this efficiency should be persuasive evidence of the need to preserve the common law public nuisance claims, and the role of courts in mitigating and compensating for damages due to GHG emissions.

   Part II of the paper reviews nuisance law and how our courts have applied that to greenhouse gas emissions so far. Part III then discusses the history of nuisance lawsuits, noting that economic efficiency does and should play a powerful role in recognizing the presence of nuisance and that this gives courts a role in responding to damage claims. Part IV demonstrates how allowing state common law nuisance damage suits for greenhouse gas emissions to exist with or without regulation produces the optimal efficiency result in all circumstances. The Article then concludes.

2. NUISANCE LAW AND THE DAMAGE FROM GREENHOUSE GAS EMISSIONS

   A private nuisance is defined as an intentional unreasonable invasion in the private use and enjoyment of land. (10) A public nuisance is an interference with the health or moral welfare of the general public." In the last 20 years, multiple cases have been brought claiming that the emission of greenhouse gases or the facilitation of greenhouse gas emissions are private or public nuisances subject to damages and injunction.

   The keystone federal case from the U.S. Supreme Court held that federal common law nuisance lawsuits for injunction are preempted by the Clean Air Act. (12) The Court held that Congress delegated to EPA the decision whether and how to regulate carbon dioxide emissions from power plants, and that this delegation displaces federal common law. (13) Specifically, federal common law nuisance lawsuits for injunctive relief "would be displaced by the federal legislation authorizing EPA to regulate carbon-dioxide emissions." (14) By finding preemption, the Court noted that, "[i]ndeed, were EPA to decline to regulate carbon-dioxide emissions altogether at the conclusion of its ongoing [section]7411 rulemaking, the federal courts would have no warrant to employ the federal common law of nuisance to upset the agency's expert determination." (15) The justices based their decision on the observation that the U.S. Congress had delegated the power to regulate greenhouse gases (including carbon dioxide) to the EPA. (16) Once Congress delegated regulatory authority to a federal administrative agency, the delegation displaced any federal common law right of the plaintiffs to seek common law relief in the courts. The plaintiffs had to take their complaints to the EPA.

   The Supreme Court has declined to determine whether and to what extent nuisance claims based on state common law are preempted by the Clean Air Act. (17) Importantly, the American Electric Power Co. Court noted that a different standard governs for preemption of federal common law than for preemption of state common law. State law is only to be preempted if there is a clear and manifest Congressional purpose. (18) The Supreme Court's 1987 decision in International Paper Co. v. Ouellette (19) (Ouellette) held that state law nuisance lawsuits were not automatically preempted by the Clean Water Act. (20) Following Ouellette, the Fourth Circuit in North Carolina ex. rel Cooper v. Tennessee Valley Authority (21) (TVA II), refused to hold that Congress had "entirely preempted the field of emissions regulation [under the Clean Air Act]." (22)

   However, while the Fourth Circuit expressly refused to find that the Clean Air Act preempted all state law tort claims concerning air pollution, it did find preemption in that particular case. (23) The court noted that the Clean Air Act was inclusive and predictable, thus occupying some of the air pollution field, and that emissions from four Tennessee coal plants were specifically subject to the comprehensive breadth of the Clean Air Act. (24) Indeed, the court noted that there were explicit Clean Air Act sections designed to address just the issue of interstate pollution that North Carolina complained of. (25)

   Other federal courts have applied the preemption reasoning to damages as well as injunctions. Around the same time American Electric Power Co. was decided, two other federal cases involving federal tort claims were decided. (26) In Comer v. Murphy Oil USA, (21) owners of land and property along the Mississippi Gulf coast sued oil companies and energy companies seeking monetary compensation for damages. The landowners argued that these companies caused emissions of greenhouse gases that contributed to global warming and added to the ferocity of Hurricane Katrina which in turn destroyed their property. (28) In Native Village of Kivalina v. ExxonMobil Corp. (29) (Village of Kivalina), an indigenous village and city alleged that multiple oil, energy, and utility companies had emitted massive greenhouse gases which had resulted in global warming and the significant erosion of the land where the city sat and thus threatened the city with imminent destruction. (30) Just as in...