The Obama administration has urged the Supreme Court to toss out an appeals court decision that would allow lawsuits against major emitters for their contributions to global warming, stunning environmentalists who see the case as a powerful prod on climate change.

In the case, AEP v. Connecticut, the 2nd U.S. Circuit Court of Appeals sided with a coalition of states, environmental groups and New York City. The decision, handed down last year, said they could proceed with a lawsuit that seeks to force several of the nation's largest coal-fired utilities to reduce their greenhouse gas emissions.

The defendants -- American Electric Power Co. Inc., Duke Energy Corp., Southern Co. and Xcel Energy Inc. -- filed a petition for review with the Supreme Court earlier this month, asking the court to reject the argument that greenhouse gas emissions can be addressed through "public nuisance" lawsuits (Greenwire, Aug. 4).

In a brief (pdf) filed yesterday on behalf of the Tennessee Valley Authority, acting Solicitor General Neal Katyal agreed with the defendants, saying that U.S. EPA's newly finalized regulations on greenhouse gases have displaced that type of common-law claim.

Katyal urged the court to vacate the decision and remand the case to the 2nd Circuit for further proceedings, this time taking into account the administration's push to regulate greenhouse gases under the Clean Air Act.

The 2nd Circuit's decision rested on the assertion that "EPA does not currently regulate carbon dioxide," but that has since changed. The Obama administration has finalized several regulations in response to the Supreme Court's 2007 decision in Massachusetts v. EPA, which told the agency to decide whether greenhouse gases were pollutants under the Clean Air Act.

"Since this court held in 2007 that carbon dioxide falls within that regulatory authority, EPA has taken several significant steps toward addressing the very question presented here," Katyal wrote. "That regulatory approach is preferable to what would result if multiple district courts -- acting without the benefit of even the most basic statutory guidance -- could use common-law nuisance claims to sit as arbiters of scientific and technology-related disputes and de facto regulators of power plants and other sources of pollution both within their districts and nationwide."

Matt Pawa, an attorney representing plaintiffs in the case, said he and his colleagues expected the White House to stay out of the matter. During a meeting with more than 30 administration lawyers at the solicitor general's office on June 24, it seemed they had "a lot of friends in the room," he said.

"We feel stabbed in the back," Pawa said. "This was really a dastardly move by an administration that said it was a friend of the environment. With friends like this, who needs enemies?"

Top attorneys at environmental advocacy groups are buzzing about the brief, sources say. Some feel betrayed by a White House that has generally been more amenable to environmental regulation than its predecessor.

"This reads as if it were cut and pasted from the Bush administration's briefing in Massachusetts," said David Bookbinder, who served as the Sierra Club's chief climate counsel until his resignation in May.

Climate and common law

Nuisance claims, a long-standing fixture of common law, are more often used to settle disputes with neighbors than to address an issue as wide-reaching as global warming. In the absence of congressional action, environmental groups say, such lawsuits could be used to make businesses, or anyone else, pay for the effects of their emissions.

Critics, including many industry groups, say the claims would lead to an inefficient and unfair jumble of litigation.

Two other similar cases are already working their way through the federal courts. In the 9th U.S. Circuit Court of Appeals, briefing is under way in Native Village of Kivalina v. Exxon Mobil Corp., while the 5th U.S. Circuit Court of Appeals recently reinstated a district court's decision to dismiss Comer v. Murphy Oil, which was brought by Hurricane Katrina victims.

Because the White House supports legislation to limit greenhouse gas emissions, many attorneys expected the Obama administration to avoid criticizing a ruling that could become so disruptive that it would force Congress to take action. Jonathan Zasloff, a law professor at the University of California, Los Angeles, said in a recent blog post that the White House would undermine its goals by siding with utilities.

If the Supreme Court does not take the case, he wrote, "then the only way to get rid of the suit is for Congress to displace it. And the only way for Congress to displace it is to pass legislation. As is the case with EPA authority to regulate carbon, this puts more bargaining power on the side that wants regulation."

Though the Supreme Court agrees to hear less than 1 percent of all petitions for review, a brief from the solicitor general tends to grab justices' attention. The court could decide as soon as this fall whether to review the case.

Richard Faulk, chairman of the environmental practice at Gardere Wynne Sewell LLP, said industry groups want the Supreme Court to review and overturn the 2nd Circuit's decision, but they would be fairly content if the justices followed the administration's suggestions.

"So far, the petitioners haven't asked that the case be remanded back, but it's hard for me to imagine that anyone would be really disappointed if the Supreme Court decided to do that," Faulk said. "People would like to see the case reversed, but having it sent back for further deliberation is certainly a better result than having the result affirmed."

Click here (pdf) to read the administration's brief.

Reporter Robin Bravender contributed.

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