They Will All Be Sued: Climate Change Needs a Lawyer

The drama in which climate change is the main character has moved from environmental conferences, political campaigns, and development strategies of companies, states, and even continents – into the courtroom – and opened the door to a new business: climate lawsuits or disputes initiated by cities, citizen associations, and anyone who can financially afford it against environmental polluters, those responsible for fires, floods, droughts, storms, hurricanes…

On the defendant’s bench are large companies engaged in activities that leave a significant carbon footprint, such as those in the oil, automotive, and aviation industries. However, these companies are not overly concerned about the new trend of lawsuits because they can afford to hire the most capable lawyers, so it is not difficult to conclude who will, at least for now, come out on top.

Easily Against ‘Greenwashing’

This recently happened to the German environmental protection association Deutsche Umwelthilfe, which lost a lawsuit against BMW, in which it sought for the well-known German car manufacturer to stop selling gasoline and diesel cars by 2030. The Munich court dismissed the lawsuit as unfounded.

Commenting on the outcome of the court process, a BMW spokesperson stated that discussions on how to achieve climate goals must be conducted in a democratically elected parliament, not in court. Mercedes-Benz, another well-known German car manufacturer, faced a similar trial, but the lawsuit from furious environmental warriors against that company was dismissed by the Stuttgart court.

However, such an outcome has not discouraged climate activists around the world. What motivates plaintiffs, who so far most often lose in legal confrontations with large companies, to file lawsuits? Above all, the devastation and damage caused by climate change around the world, but also the false reports from companies claiming that their activities do not harm the environment or that they harm it ‘within normal limits’. The head of the carbon trading project at the University of California, Berkeley Barbara Haya, stated that companies make false claims, for example, convincing customers that they can fly on airplanes without feeling guilty or buy carbon-neutral products even though they are in no way carbon-neutral.

A series of climate lawsuits is currently underway worldwide. For instance, due to unfair commercial practices and misleading advertising, three French non-governmental organizations have filed a lawsuit against TotalEnergies, which has rebranded itself as environmentally sustainable to achieve net-zero greenhouse gas emissions by 2050, which is not true. In Australia, a non-governmental organization representing shareholders sued the oil and gas company Santos for claiming to provide clean energy despite using natural gas and providing a misleading plan to achieve net-zero greenhouse gas emissions.

In the Netherlands, a court ordered Shell to reduce emissions across all activities, including its own emissions and end-use emissions. A lawsuit has also been initiated against the large Dutch airline KLM, challenging its ‘CO2ZERO’ campaign. Plaintiffs claim that the campaign misleads customers because these products do not contribute to reducing the carbon footprint.

Accused of Deception

However, the most famous climate lawsuit is currently taking place in Puerto Rico, where sixteen municipalities filed a unique collective lawsuit in late November last year in federal district court against Exxon, a fossil fuel company, holding it responsible for losses incurred due to storms during the 2017 hurricane season and afterwards.

In the lawsuit, Puerto Rican cities claim that fossil fuel companies are responsible for knowingly producing and marketing environmentally harmful products and for concealing and misrepresenting associated dangers. The case is unique for several reasons: it is the first climate lawsuit against fossil fuel companies initiated in Puerto Rico, the first climate case against fossil fuel companies causing harm to the suing cities, and the first climate case involving allegations of corruption in the preparation of reports on companies’ environmental impacts.

The ‘Puerto Rico’ case is part of a broader American movement of climate lawsuits in which cities and counties across America have filed more than twenty lawsuits seeking compensation from fossil fuel companies for environmental pollution. Many of these cases use the argument that companies knowingly marketed harmful products and misled the public about their effects. The ‘Puerto Rico’ case followed recent successes in climate lawsuits in Europe (France and the Netherlands) and around the world, where courts have held governments and companies accountable for climate damage.

In Court Due to Storms

Relying on research from the ‘Carbon Majors’ Institute for Climate Responsibility (which reported in 2017 that 51 percent of total global carbon dioxide pollution is produced by just 25 large global companies), Puerto Rican cities in the lawsuit claim that the defendants are responsible for more than 40 percent of all global industrial greenhouse gas emissions from 1965 to 2017 and that these joint emissions were a significant cause of the increased intensity of the hurricane season in the Atlantic in 2017.

Furthermore, they claim that as a result, Puerto Rico suffered apocalyptic damage from two hurricanes, Irma and Maria, in 2017, and that it will require $124 billion to repair the damage. Plaintiffs also assert that the defendants knowingly contributed to the worsening of climate change through the production, advertising, marketing, and sale of fossil fuel products…

The lawsuit states that the ‘global corporate strategy for concealing information’ about the impact of the defendants’ products on climate change will likely result in Puerto Rico, and thus the suing cities, being devastated by dangerous and deadly storms. The cities seek for the defendants to pay the costs that the plaintiffs have already incurred and will continue to incur due to climate change, as well as punitive damages by confiscating profits.

Such disputes will increase as there is more evidence that large corporations misrepresent the impact of their products on climate change. For example, the Philippine Commission on Human Rights revealed that the world’s largest producers of fossil fuels and cement have been aware of the harmfulness of fossil fuel products to the environment since 1965, but have also deliberately lied and obstructed environmental activists for decades.

Not Expropriated, But…

There would likely be even more such lawsuits if they were subsidized. Outside the U.S., where most of these lawsuits occur, subsidizing climate lawsuits initiated by cities is still rare. A positive example comes from France, where the municipality of Grande-Synthe and its mayor filed a lawsuit against the French government demanding that it take all necessary measures to reduce greenhouse gas emissions in accordance with commitments made at the international and national levels. They won: the State Council ordered the French government in 2021 to take all necessary measures to reduce greenhouse gas emissions to meet climate goals, including a 40 percent reduction by 2030.

But companies are striking back. For instance, German energy companies Uniper and RWE, which have three power plants in the Netherlands, have approached the court in that country for compensation for violation of property rights due to the Coal Ban Act for electricity production adopted by the Dutch government in 2019, which prohibits the use of coal in electricity production by 2030. They stated that the law violates their property rights as it was introduced without offering financial compensation and sought compensation of 1.4 billion euros from the Dutch state.

The District Court in The Hague ruled that RWE and Uniper cannot seek financial compensation for the mandatory gradual phase-out of coal-fired electricity production. Although the law does indeed violate the property rights of energy companies, the court ruled that this violation is not illegal and decided that there are several financial interests in the continued use of power plants, including the possibility of repurposing for the use of other energy sources, such as biomass. This decision does not mean expropriation, but is part of the legal regulation of corporations, which in itself does not require compensation.

Regional Standards

The new ‘business model’ of climate activists has also concerned states, prompting the governments of Chile and Colombia to seek the opinion of the Inter-American Court of Human Rights in early January this year regarding the obligation of states to respond to the extraordinary climate situation. They are interested in whether states have special obligations in dealing with emergency climate cases.

These two countries, considering the consequences of climate change in South America, emphasized the need for regional standards to accelerate action in combating climate change and requested the court to refer to procedures related to regulation, monitoring, environmental impact assessment, emergency plans, and mitigation activities that may exacerbate the climate crisis.