By Jeryl L. Olson and Eric E. Boyd

The United States Supreme Court today ruled unanimously that the Clean Air Act’s regulation of green house gases (GHGs) “displaces” federal common law public nuisance claims. American Electric Power Company, et al. v. Connecticut, et al., No. 1-174, 564 U.S. ___ ( 2011). The law suits addressed by the Court, begun long before the EPA initiated efforts to regulate GHGs under the Act, had asked the federal district courts to establish GHG emissions limits for the defendants, allegedly “the five largest carbon dioxide emitters in the United States.” The Supreme Court concluded that, “The expert agency [EPA] is surely better equipped to do the job than individual district court judges issuing ad hoc, case-by-case injunctions.” Opinion at Page 14. Despite the unanimity of the opinion, there were three noteworthy aspects of the decision.

First, the Supreme Court split 4 to 4 on the question of whether the federal courts had standing to adjudicate the case. Four Justices believed that none of the Plaintiffs had Article III standing, and four Justices believed that at least some of the Plaintiffs had standing. The Supreme Court therefore affirmed the Second Circuit’s exercise of jurisdiction and proceeded to the merits. How each of the Justices stood on the standing question is not discussed. Justice Sotomayor took no part in the decision.

Second, the Court clarified its prior displacement analysis. The Court explained, “The test for whether congressional legislation excludes the declaration of federal common law is simply whether the statute “speak[s] directly to [the] question” at issue. Opinion at Page 10 (citing Mobil Oil Corp. v. Higginbotham, et al.). Although the Plaintiffs had argued (and the Second Circuit held) that federal common law is not displaced until the EPA exercises its regulatory authority by issuing standards, the Court disagreed, explaining, “the relevant question for purposes of displacement is “whether the field has been occupied, not whether it has been occupied in a particular manner.” Opinion at Page 12 (citing Milwaukee v. Illinois). The Court went on to explain the many ways that the Clean Air Act requires the EPA to address sources of GHGs. Since Congress delegated to the EPA the decision whether and how to regulate GHG emission sources, federal common law was displaced. The Plaintiffs’ only relief, therefore, is judicial review following EPA action, not recourse to a federal common law of nuisance.

Third, the Supreme Court did not base its decision on the “political question” doctrine. The District Court had dismissed the suits because they presented non-justiciable political questions, but the Second Circuit held that the suits were not barred by the political question doctrine.

Finally, although the Court found that the federal common law of nuisance was unavailable to the Plaintiffs, the Court took no action on the availability of claims under state nuisance law. A decision as to whether the Clean Air Act preempts nuisance suits under State law must, therefore, wait for another day.