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William Barr Discovers the Economics of Tort Law (and Misrepresents the Law Governing Interstate Pollution)

Another reply to the former attorney general on climate litigation that may end up in the Supreme Court.

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Last week, former Attorney General William P. Barr wrote an op-ed for the Wall Street Journal purporting to expose a nefarious effort to impose a carbon tax through tort litigation. His op-ed is part of a broad effort to convince the Supreme Court to grant certiorari in Suncor v. County Commissioners of Boulder County, a tort suit filed against fossil fuel companies seeking compensation for the costs of adapting to climate change.

Today, the WSJ published my letter to the editor replying to Barr's op-ed, in which I noted there is nothing scandalous in what Barr reports, and that his underlying legal claims are without merit. As readers may recall, I have sparred with Barr on this subject before (see here and here).

In his op-ed, Barr reports that an attorney who has supported and assisted the filing of state-law-based tort claims by state and local governments against fossil fuel companies noted on a Federalist Society teleforum that, if these suits are successful, they would impose a de facto carbon tax. Barr treats this a scandalous confession. It is nothing of the kind. It is, rather, what everyone understands about the nature of tort suits.

When torts suits against firms that manufacture or distribute a product are successful, the liable firms inevitably seek to pass those costs on to consumers in the form of higher prices. Supporters of tort reform assail this "tort tax" as a burden on consumers and entrepreneurs. Others view it as means of internalizing externalities and ensuring that consumers pay for the full costs of what they consume. Anyone who is surprised that this dynamic would recur in the context of climate litigation is simply not well-versed in the economics of tort law.

In his op-ed, Barr does not seek to argue that it would be inappropriate to hold fossil fuel companies responsible for the costs of climate change to local communities--costs that include the affects on infrastructure and climate adaptation efforts. Instead he tries to argue that such suits are preempted by federal law, and in the process makes a legal error.

Barr writes:

Can states regulate emissions that take place outside their borders?

More than a century of Supreme Court precedent indicates that the answer must be no. Disputes involving pollution that crosses state or international borders are the exclusive domain of federal law.

Barr is simply wrong on this point, and he should know it as I have corrected him on this point before. Under current law, suits seeking redress for harms caused by interstate pollution can be filed under state law; they are not "the exclusive domain of federal law."

As I have explained at length, the Supreme Court has held that federal common law suits over interstate pollution are displaced by federal pollution control statutes. This is because federal common law is disfavored and is deemed to be displaced once Congress enacts a relevant statute. Displacement is different from preemption. And the Supreme Court has also held, most explicitly in International Paper v. Ouellette that state law suits over interstate pollution are not preempted and may proceed, provided that courts apply the law of the upwind or upstream state.

In the case of climate change, there is nothing in the Clean Air Act that preempts state regulation or or litigation over greenhouse gases and the potential harms of climate change. Indeed, there is nothing in the CAA that was enacted with an eye toward preventing climate change at all. And with regard to the types of air pollutants upon which the CAA was focused--ozone precursors, particulates, etc.--the CAA contains a broad savings clause and does little little to preempt state regulation or litigation, save for select provisions focused on the regulation of certain products sold in interstate markets (such as automobiles). Congress could preempt such suits if it wanted to, but it has never done so.

There are serious arguments that the various climate suits should fail on traditional tort law grounds, perhaps because the chain of causation is too attenuated or too difficult to prove, or that there are constitutional limits on the scope of conduct that can be subject to liability in state courts consistent with Due Process and the Dormant Commerce Clause. And there may well be an argument that the Supreme Court should intervene should a state court award universal relief to a local jurisdiction for the accumulated effects of global greenhouse gas emissions that exceeds such limits. But these are not the claims that Barr is making. Rather he is asserting that federal law precludes state courts from even hearing these claims, and he is misstating the law in the process.

For a deeper dive into the debate over this question, I recommend this panel from last year, "A Debate on The Right — Climate Lawsuits and Federalism: What Is the Role of State Tort Law?", in which I debated several thoughtful commentators on this subject.

For more on the subject, here are my prior posts on climate-related tort litigation:

And here (again) is my longer paper on the subject.