By a vote of 8 – 0, the United States Supreme Court recently ruled that congressional delegation of authority to EPA to regulate pollutants under the Clean Air Act (“Act”) speaks directly to regulation of carbon dioxide emissions from power plants and therefore displaces any right a plaintiff might otherwise have to seek abatement of carbon dioxide emissions from such facilities under federal common law. The court’s decision was handed down on June 20, 2011, in the case of American Electric Power Co., Inc., et al. v Connecticut, et al. and builds on its earlier decision in Massachusetts v. EPA, 549 U.S. 497 (2007) in which carbon dioxide and other greenhouse gases (GHG) were found to be “air pollutants” under the Act and therefore subject to regulation by EPA. It was the decision in Massachusetts that paved the way for EPA to develop regulations governing greenhouse gas emissions. In AEP, a number of states, together with the City of New York and several private land trusts, sued five large utilities operating coal-fired electric power plants in the United States. Plaintiffs alleged that the utilities collectively emitted 25 percent of all carbon dioxide produced at domestic power plants and 10 percent of all carbon dioxide from human activity in the United States. According to plaintiffs, these emissions constitute a “substantial and unreasonable interference with public rights” and are thus a nuisance under federal common law, as well as state tort law. Plaintiffs sought to hold defendants jointly and severally liable for global warming and to obtain an injunction in district court which would cap defendants’ emissions and require periodic reductions over a period of 10 years or more. The district court, however, dismissed the claims, holding that they were “non-justiciable political questions” best left to policymakers.

The 2nd Circuit Court of Appeals took up the issue in 2007 and reversed the lower court. The 2nd Circuit found that plaintiffs’ claims were not barred by the political question doctrine and that plaintiffs had, in fact, stated a claim allowing

for abatement under the federal common law of nuisance. Critical to the 2nd Circuit’s decision to allow the case to go forward was the fact that EPA had not yet promulgated regulations governing carbon dioxide emissions from power plants. However, this fact was thought relevant by the 2nd Circuit based on an overly broad interpretation of the Supreme Court’s decision in Milwaukee v. Illinois, 452 U.S. 304 (1981). In Milwaukee (which involved a similar interstate pollution situation under the Clean Water Act), plaintiffs sought abatement of water pollution under a theory of federal common law nuisance. There, plaintiffs’ claims were ostensibly dismissed because EPA had been delegated authority to, and had, in fact, promulgated regulations comprehensively regulating the water pollution at issue. According to the 2nd Circuit, the situation in AEP was different from Milwaukee because EPA, while having authority to do so, had not promulgated regulations addressing the pollution at issue. Because there were no such regulations in place for carbon dioxide emissions from power plants, the 2nd Circuit reasoned that federal common law had not been displaced and plaintiffs’ claims could go forward.

Article authored by McAfee & Taft Attorney: Robert Joyce.