The U.S. Supreme Court delivered a major blow to major oil companies on Monday by refusing to block climate change lawsuits filed by California and other states. The decision allows about two dozen states and municipalities to proceed with their cases seeking billions in damages.
The court rejected appeals from Sunoco, Shell, and other energy producers without comment or dissent. Justice Samuel A. Alito Jr. recused himself from the decision, likely due to his stock ownership in affected companies.
The oil companies had urged the Supreme Court to intervene, arguing that climate change impacts should be handled under federal law rather than through state-by-state claims. Their request was denied, opening the door for states to pursue their cases in local courts.
California's lawsuit, filed by Governor Gavin Newsom and Attorney General Rob Bonta, targets five major oil companies - Exxon Mobil, Shell, Chevron, ConocoPhillips, and BP - along with the American Petroleum Institute. The suit alleges these companies conducted a "decades-long campaign of deception" about fossil fuels' environmental impact.
The legal strategy mirrors successful lawsuits against tobacco companies and pharmaceutical firms over cigarettes and opioids. Like those cases, states argue that oil companies deliberately concealed known dangers of their products while profiting from them. Under state law, companies can face liability for failing to warn consumers about known hazards.
The Biden administration supported letting the cases proceed in state courts, noting they were still in early stages. Meanwhile, Alabama and 20 other Republican-led states opposed the suits, arguing that liberal states shouldn't have power to set national energy policy.
The Supreme Court's decision centered on a case from Honolulu, Hawaii, which sued 15 oil and gas producers five years ago. The Hawaii Supreme Court previously allowed the case to move forward, stating the core issue was whether companies misled the public about fossil fuels' environmental impacts through sophisticated disinformation campaigns.
This ruling represents a watershed moment in climate litigation, potentially exposing the oil industry to substantial financial liability while setting precedent for how climate-related damages can be pursued through state courts.