Federal Judge: Rhode Island’s Climate Fraud Lawsuit Against Big Oil Belongs in State Court

The U.S. 1st Circuit decision is the latest blow to Big Oil's attempts to fend off accountability and damages for decades of climate disinformation.

by | Oct 30, 2020

Calimari's taken off as warming seas drive away Rhode Island's traditional lobsters and flounder. (Credit: DNC)

A federal judge has ruled that Rhode Island’s climate liability case against 21 oil and gas corporations belongs in state court, where the state originally filed it in 2018.

The Oct. 29 decision by the U.S. 1st Circuit Court of Appeals aligns with three other federal appeals court decisions this year in similar climate lawsuits against Big Oil.

Rhode Island is one of two dozen communities around the country suing the fossil fuel industry for its decades of deliberately misleading the public about the risks associated with burning coal, oil, and gas. Like the others, Rhode Island is seeking to hold the industry accountable for the billions of dollars in costs it now faces to contend with climate change impacts including higher temperatures, more extreme rainfall and flooding, and coastal erosion caused by rising seas. According to a 2017 state report, Narragansett Bay’s warming temperatures have already begun to cause a shift from cold-water to warm-water marine species, driving down populations of key fisheries like lobster and winter flounder.

Chevron, ExxonMobil, BP, Shell, and other petroleum firms have fought to move climate lawsuits by states and municipalities to federal courts, where they believe they have a better chance of fending them off. In early October the Supreme Court granted the industry’s petition to review a wonky procedural question in a climate lawsuit brought by the city of Baltimore, regarding how broadly the firms can make their arguments for shifting these cases to federal court.

That question was also among those at play in the Rhode Island case, where federal Judge O. Rogeriee Thompson ruled that the correct scope of such review was a narrow one: whether there was merit in the companies’ argument that their contracts with the federal government to extract oil and gas on federal lands rendered them “federal agents,” and thus protected from legal actions in state or local courts.

Thompson rejected that claim, as federal appeals court judges have in three other climate cases this year, calling it a “mirage” that has no relevance to Rhode Island’s charges of what is effectively fraudulent commercial behavior.

“Rhode Island is alleging the oil companies produced and sold oil and gas products in Rhode Island that were damaging the environment,” Thompson wrote in her decision, “and engaged in a misinformation campaign about the harmful effects of their products on the earth’s climate. The contracts the oil companies invoke as the hook for federal-officer jurisdiction mandate none of those activities.”

During a hearing on Sept. 11, 1st Circuit judges repeatedly questioned Chevron attorney Ted Boutrous as he sought to downplay Rhode Island’s allegations of deception. This week the court has stated clearly that this deceitful conduct is at the core of the lawsuit.

“Rhode Island’s claim is simple: the oil companies knew what fossil fuels were doing to the environment and continued to sell them anyway,” Thompson noted, “all while misleading consumers about the true impact of the products.”

Big Oil’s disinformation campaign helped delay response to climate change and turn it from a science-informed policy question into a political wedge issue — one that President Trump has used in the past four years to cripple federal climate science, further subsidize the fossil fuel industry, and roll back Obama-era reforms on auto emissions, methane pollution from drilling sites, and protection of endangered species and remaining wilderness from oil and gas development.

The DRILLED podcast explores this “true crime story,” which has also been investigated by InsideClimate News and the Los Angeles Times, and documented by historians Naomi Oreskes and Erik Conway in their book Merchants of Doubt.

Emily J Gertz contributed reporting to this story.

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Dana Drugmand is a freelance journalist specializing in climate change, clean energy, and citizen activism. She holds a Master’s degree in Environmental Law & Policy with a certificate in Climate Law from Vermont Law School.