California manufacturers are big players in the state’s efforts to address climate change. The largest companies are regulated through a program that will greatly reduce emissions and grow the economy at the same time. The result will be a win-win for jobs and the environment.
Unfortunately, trial attorneys and a handful of municipalities in California are filing lawsuits that will undermine this winning formula. They are blaming fuel manufacturers for floods, heat waves, droughts, wildfires, and severe weather to extract billions of dollars in settlements or court rulings.
On Wednesday, a federal judge held a hearing in one of the suits — a highly unusual tutorial on the science of climate change, pitting lawyers for Chevron, Exxon and other oil companies against attorneys for Oakland and San Francisco.
A big payday for the trial attorneys, not a solution to global climate change, is the main motivation for these suits. The attorneys and municipalities don’t care that their lawsuits hurt California’s ambitious climate change policies.
An important feature of California law is that emissions should be reduced, not simply shifted out of state due to high costs and burdensome regulations. For that reason, the California Manufacturers & Technology Association supported a robust cap-and-trade program to allow flexible compliance. Last year, the Legislature extended cap and trade to 2030, which will raise billions of dollars to fight climate change and address other environmental challenges.
The unjustified lawsuits will add costs to energy manufacturers by forcing them to defend or settle the cases. Those costs will be passed on to consumers, other manufacturers and businesses that depend on fuel for transportation and production. Piling these new costs on top of the reasonable costs related to cap and trade could push production out of state along with their emissions.
Other costs may be imposed on manufacturers and other taxpayers from these suits. The eight municipalities making claims against oil companies are making allegations that don’t match declarations they have made in recent bond offerings. Will taxpayers be on the hook for litigation related to these discrepancies?
For example, San Francisco, which has told the court that it faces an “imminent risk” of flooding from sea-level rise, told investors last year that the city “is unable to predict whether sea-level rise or other impacts of climate change” will occur.
San Mateo County claims that it is “particularly vulnerable” to sea-level rise and that there is a 93 percent it will experience a “devastating” flood before 2050. Marin County is even more certain, calculating a 99 percent risk of a devastating flood before 2050. But contrast that with bond offerings in 2014 and 2016 where investors were told that the county “is unable to predict whether sea-level rise or other impacts of climate change or flooding from a major storm will occur."
It's not too late for the public to demand a stop to the risky, costly and unnecessary litigation against manufacturers. Let’s keep working together to achieve our goals and be a model for others to follow.