Legal Alert Snell & Wilmer L.L.P.
June 24, 2011

Patrick Paul
Patrick J. Paul
602.382.6359
ppaul@swlaw.com
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Marc Erpenbeck
Marc A. Erpenbeck

602.382.6512
merpenbeck@swlaw.com
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Christpoher Colyer
Christopher P. Colyer

602.382.6579
ccolyer@swlaw.com
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American Electric Power Co., Inc. v. Connecticut: The United States Supreme Court Holds that the Clean Air Act Preempts Federal Common Law, But Deadlocks on Standing Issues

On June 20, 2011, the United States Supreme Court decided American Electric Power Co., Inc. v. Connecticut, holding that the Clean Air Act (“CAA”) preempts the operation of federal common law. However, this case is more notable for the issues it did not decide: whether plaintiffs have Article III standing to sue air polluters to obtain emissions caps and whether adjudication of these claims is barred by the political question doctrine.

Background
In July 2004, eight states, New York City and three nonprofit land trusts sued four power companies and the Tennessee Valley Authority—allegedly the five largest carbon dioxide emitters in the United States—requesting the court set emissions caps for each defendant. Plaintiffs alleged that defendants’ emissions placed public lands and public health at risk from climate change in violation of the federal common law of interstate nuisance.

The District Court failed to reach the merits of plaintiffs’ arguments, however, instead dismissing the case as presenting non-justiciable political questions. The Second Circuit reversed, stating the political question doctrine did not bar the claims and that plaintiffs had Article III standing. Moving to the substantive merits of the case, the Second Circuit held that plaintiffs properly pled a federal common law nuisance claim. Specifically, the Second Circuit determined that the CAA did not “displace” or preempt federal common law because the Environmental Protection Agency (“EPA”) had yet to regulate, or speak directly to, plaintiffs’ requested relief.

The Supreme Court’s Opinion Dodges Standing and Political Question Doctrine Issues
In an eight to zero vote—Justice Sotomayor was recused—the United States Supreme Court reversed. The Supreme Court’s opinion addresses only the substance of plaintiffs’ claims and largely bypasses the threshold issues of standing and the political question doctrine. The only reference to these threshold issues is a carefully worded paragraph acknowledging an even split between the eight presiding Justices as to whether plaintiffs had Article III standing pursuant to Massachusetts v. EPA, 549 U.S. 497 (2007). The Supreme Court addressed the political question doctrine, as well as other threshold issues, only in a footnote. Likewise, the Supreme Court did not discuss plaintiffs' state law tort claims, remanding these claims to the Second Circuit.

The Displacement of Federal Common Law
Ignoring these standing and separation of powers issues, the Supreme Court decided that no federal common law nuisance claim exists because it was displaced by the CAA.

The test for whether Congressional legislation, such as the CAA, excludes federal common law is whether the statute “speaks directly to [the] question” at issue. According to Massachusetts, carbon dioxide is subject to regulation under the CAA. The CAA requires the EPA to set guidelines for pollutants subject to it. Consequently, the EPA must set emissions standards for carbon dioxide pursuant to the CAA. Similarly, plaintiffs’ federal common law nuisance claims asked the court to set the maximum carbon dioxide emissions for defendants. Therefore, in the opinion of the Supreme Court, plaintiffs were seeking the exact same relief as that imposed by the CAA on the EPA, the setting of maximum carbon dioxide emission standards. Because plaintiffs sought the same relief as that imposed by the CAA, the Supreme Court determined that the CAA displaced plaintiffs’ federal common law claim.

Implicit Parallels to the Political Question Doctrine
Interestingly, although the Supreme Court’s opinion did not address whether or not a non-justiciable political question existed, its analysis is substantially similar to typical political question doctrine analysis. In particular, the Supreme Court defends its holding by observing as a policy maker, the EPA—rather than the judicial branch—is better suited to determine the appropriate emissions requirements in light of various health impacts and emission reduction costs.

Conclusion
The Supreme Court’s opinion addresses a narrow issue and avoids larger issues related to standing and the political question doctrine. Given the lack of guidance regarding environmental standing—evidenced by the District Court’s determination that standing did not exist, the Second Circuit’s reversal and the Supreme Court’s four to four split on the issue—it remains to be seen whether the Supreme Court addresses the issue again, particularly with all nine Justices presiding. Nevertheless, this opinion may become moot in just a matter of months given pending legislation to rescind the EPA’s power to regulate greenhouse gases. If this legislation passes, a federal common law nuisance claim may again be proper. Thus, the true impact of this case “is up in the air.”

 

 

 
 

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