The Paris Agreement reached at the 21st Conference of the Parties (COP-21) to the 1992 UN Framework Convention on Climate Change is a tobacco-style mass tort settlement cloaked as a global agreement to control greenhouse gases. Remaining in or departing the agreement involves a host of complex diplomatic, economic, and environmental issues.
Paris is the culmination of ten years’ of negotiations following the 2005 agreement in Montreal by industrial and developing nations to pursue talks aimed at “Long-Term Cooperative Action.” Prior to COP-10 in Montreal, and in the discussions leading to the 1997 Kyoto Protocol, developing nations steadfastly refused to consider taking on any substantive greenhouse gas emission control obligations, citing their need for economic growth, the eradication of poverty, and the historic responsibility of industrial nations for increased global greenhouse gas concentrations. Today, developing nations are the largest source of greenhouse gas emissions.
The U.S. and 174 other nations signed the Paris Agreement in New York on April 22, 2016. The agreement entered into force on October 6, 2016, and has been ratified to date by 122 of its signatories. If all of the emission reduction pledges submitted thus far were implemented, Paris may accomplish a modest reduction in the rate of growth of global greenhouse emissions, but will not come close to achieving its goal of limiting post-industrial temperature increases to 2 degrees Celsius.
More important to many of its signatories is achieving the other central purpose of the Paris Agreement: transferring upwards of $100 billion annually from industrial nations to less-developed countries to support emission mitigation and adaptation programs.
If the Paris agreement falls apart – by the defection of the U.S. or other major emitting nations, or through subsequent recognition that its ambitious climate targets and financial promises are unlikely to be achieved – the result could be mass tort litigation against major sources of carbon emissions such as international oil companies and other fossil fuel interests.
Tobacco and Climate Change
In the late 1990s, tobacco companies were sued by several states seeking compensation for higher health care costs caused by sick smokers. The tobacco companies ultimately agreed to a multi-billion dollar structured payout to the states, to be used for tobacco education programs or other purposes deemed appropriate by the plaintiffs. This financial settlement was reached in exchange for the states’ agreement not to pursue further litigation against the companies.
Now consider the structure of the Paris Agreement. Virtually all participating nations have submitted non-binding pledges to reduce or limit the growth of greenhouse gas emissions. In many cases, these pledges are explicitly contingent upon the transfer of financial and technological resources from industrial nations. The $100 billion annual pledge for developing country support – equivalent to about two-tenths of one percent of the GDP of all OECD industrial nations - was offered by then-Secretary of State Hillary Clinton at COP-15 in Copenhagen in 2009. When those negotiations broke down, the U.S. financial compensation offer was not forgotten. It later became a centerpiece of the talks resulting in the Paris agreement.
Responsibility without Liability
At the opening session of COP-21 in Paris, President Obama accepted “historic responsibility” for the United States’ contribution to increased greenhouse gas concentrations since the industrial revolution. Since 1780, global CO2 concentrations have risen from 280 ppm to more than 400 ppm, largely due to increased emissions from fossil fuel sources and mass deforestation by some developing nations.
While the President was accepting a share of the blame, his lawyers were hard at work. First, they quashed proposals to establish a new “climate court” to adjudicate claims of climate-related damages. Next, they fine-tuned a provision that could help to protect major industrial emitters from future liability for “loss and damages” associated with climate change. The liability provision included as Paragraph 51 of the COP-21 Decision adopting the Paris Agreement states that the Conference of the Parties “Agrees that Article 8 of the Agreement does not involve or provide a basis for any liability or compensation.” FCCC/CP/2015/10 Add.1.
Insurance for Parties at Risk
Article 8 of the Paris Agreement establishes an insurance program - the Warsaw International Mechanism - designed to make affordable climate-related insurance available to nations vulnerable to the effects of climate change, such as low-lying island states. To this end, Paragraph 48 of the COP Decision“(r)equests the Executive Committee of the Warsaw International Mechanism to establish a clearing house for risk transfer that serves as a repository for information on insurance and risk transfer, in order to facilitate the efforts of Parties to develop and implement comprehensive risk management strategies.” Id.
If Paris remains in full force and effect, it will serve as the exclusive multilateral entity charged with regulating the causes, consequences and remedies appropriate for climate change. The agreement thus may provide an effective shield against the exercise of subject matter jurisdiction by any court outside the U.S. in cases involving claims for damages associated with the effects of rising sea levels or other environmental consequences of climate change. Within the U.S., the Supreme Court already has decided (AEP v. Connecticut, 564 U.S. 410, 2011) that for federal courts the Clean Air Act displaces federal common law nuisance actions, placing jurisdiction over climate-related remedies in the U.S. Environmental Protection Agency. The AEP Court’s holding was limited to federal common law nuisance actions, thus leaving open the possibility of tort recovery based on state common law nuisance claims.
Should We Stay or Should We Go?
The decision to remain in or depart from the Paris Agreement is a high priority for the new Trump Administration. Some see advantages to simply walking away, or just ignoring the agreement given its lack of enforcement provisions. The President could issue an executive order withdrawing President Obama’s signature, or submit the agreement to the Senate for its advice and consent.
For some proponents, the case for walking away is strengthened by the collateral impact this would have on U.S. EPA’s future ability to exercise authority under Section 115 of the Clean Air Act to impose a carbon cap-and-trade program or similar measures to abate international air pollution. Environmental interests have advocated such a course in light of the legal difficulties besetting EPA’s Clean Power Plan.
Other advocates see a benefit to continuing U.S. participation in Paris to preserve it as a “global” forum for the discussion and resolution of climate-related issues. Through both Democratic and Republican administrations, the U.S. has been an effective interlocutor in all 22 Conferences of the Parties to the 1992 Rio Framework Convention.
Being at the table in international negotiations, especially where the potential liability of mass tort litigation is implicitly at issue, does not entail slavish implementation of unrealistic climate policies. The two degree Celsius target of the Paris Agreement is at the low end of targets considered appropriate by many in the scientific community. Meeting this target implies decarbonization of the U.S. energy sector by 2050, as documented by the Mid-Century Climate Strategy disseminated by the Obama Administration at COP-22 in Marrakech last November. This target, along with the pledge of a future “floor” contribution of $100 billion annually to developing nations, could be revisited and renegotiated in the regular “pledge and review” processes established by Paris.
The decision to withdraw from Paris should be weighed in light of its prospective trade and diplomatic impacts with other major carbon emitters, including the EU, China, Russia and India. The potential legal consequences of disengagement need to be thoroughly evaluated, along with the risks that U.S. withdrawal could precipitate widespread defection by many developing nations more eager to pursue litigation than to purchase insurance.
*The writer is an attorney in private practice (NYU, 1972; Georgetown U. Law Ctr., 1977). He has participated as an NGO representative of U.S. labor interests in all major negotiating sessions of the UN FCCC since 1993. He may be contacted at firstname.lastname@example.org.