Speaker 1: This is Bloomberg Law with June Brussel from Bloomberg Radio
Speaker 1: put a landmark decision by a Dutch court be the
Speaker 1: start of a new war against big oil. A Dutch
Speaker 1: court rule that Royal Dutch Shell had to cut its
Speaker 1: emissions on the grounds that the oil giant is violating
Speaker 1: human rights by contributing to global warming. Joining me is
Speaker 1: environmental law professor Pat Parento of the Vermont Law School.
Speaker 1: Pat tell us about this landmark decision. It's the first
Speaker 1: time in history, in fact, that a court has ordered
Speaker 1: a private corporation to not only comply with reducing their
Speaker 1: emissions of carbon dioxide, but to a level that's literally
Speaker 1: going to require Shell to reconsider its its entire business plan.
Speaker 1: They're not going to be able to realize the exploitation
Speaker 1: of all of the oil and gas reserves that they
Speaker 1: have on their books. That's what this decision means. It
Speaker 1: means changing your whole modus ARANDAI, and that's really stunning. Now,
Speaker 1: it is a lower court decision in the Netherlands, it's
Speaker 1: the Hague District Court, so it will have to go
Speaker 1: to the Dutch Supreme Court the way the earlier for
Speaker 1: Agenda case did. But it's it's quite startling in its
Speaker 1: potential impact. Can Shell accomplish what the courts set out
Speaker 1: if it loses the appeal? Very uncertain unclear as to
Speaker 1: how Shell would do this, because the most striking thing
Speaker 1: about this decision is that it includes emissions from Shell's customers,
Speaker 1: You and I, people who pump their gas and drive
Speaker 1: you know, gas pard vehicles all over the world. Um
Speaker 1: So Shell has to somehow figure out how two offset
Speaker 1: all of those emissions. They're called Scope three emissions in
Speaker 1: the in the jargon um and nobody's ever done that. No,
Speaker 1: no corporation. Amazon has ledged to do something like that
Speaker 1: for the emissions from its supply chain, but but nobody
Speaker 1: has actually done it. So it's very unclear as to
Speaker 1: how Show would actually accomplished this reduction in its emissions
Speaker 1: by m measured against two thousand nineteen levels. And the
Speaker 1: allegation was a human rights violation, it was a mixed yes,
Speaker 1: it was account similar to the Agenda case, which was
Speaker 1: the decision of the Dead Supreme Court ordering the Dutch
Speaker 1: government to reduce emissions UM this year last, which the
Speaker 1: Dutch government did actually um so, so this one um
Speaker 1: is based on the same kind of European Convention for
Speaker 1: the Protection of Human Rights that the Dead Supreme Court
Speaker 1: used in the Agenda case. It all so is looking
Speaker 1: at all kinds of international agreements under the Paris Framework
Speaker 1: UM and common law UM, sort of a sense of
Speaker 1: you know, what's the duty of a corporation in light
Speaker 1: of this overwhelming impact and challenge of climate change. It's imposing,
Speaker 1: said this court, an extra duty of care on the
Speaker 1: part of not just the government, but on the part
Speaker 1: of corporations that are, of course, you know, integral to
Speaker 1: both the problem itself and two solutions to the problem.
Speaker 1: So again, you know, just unprecedented UM and and unclear
Speaker 1: exactly how this is all going to unfold. So this
Speaker 1: is based on Dutch law. Is there any chance that
Speaker 1: other courts in Europe will see this the same way? Well,
Speaker 1: that's an open question. Some of the Dutch scholars that
Speaker 1: I've been reading say that um, it could have a
Speaker 1: bearing on how other European courts look at these questions.
Speaker 1: Another case that bears watching in this frame is the
Speaker 1: case from Portugal. The six young people in Portugal who
Speaker 1: have persuaded the European Court of Human Rights to consider
Speaker 1: their charge that I think six of the member states
Speaker 1: of the European Union, most prominently Poland UM, are guilty
Speaker 1: of exacerbating the climate problem, threatening the well being of
Speaker 1: these young people and and you know, sort of bankrupting
Speaker 1: their future kind of argument. And that case is being
Speaker 1: brief now and will be argued sometime in the next
Speaker 1: few months. So a lot of people are looking at
Speaker 1: that court in that decisions as yet another benchmark, if
Speaker 1: you will, on climate law and its development. So there's
Speaker 1: a lot happening. The German Constitutional Court also recognized the
Speaker 1: rights of future generations are being threatened by climate change
Speaker 1: and have imposed some additional requirements on the federal government
Speaker 1: in Germany UH to to come up with plans to
Speaker 1: address that. We saw in Australia. Another court in Australia
Speaker 1: has recognized once again climate change threatening future generations in
Speaker 1: the context of approving coal mines. Of course, Australia is
Speaker 1: still producing an enormous amount of coal that it sends
Speaker 1: to China and India and other places. So yeah, I
Speaker 1: mean it's hard to keep tracks. There are so many
Speaker 1: cases now moving through different courts around the world. But
Speaker 1: in the United States these cases, for example, there is
Speaker 1: the kid's climate lawsuit that's be installed. These cases aren't
Speaker 1: moving in the United States, are they not? Really? The
Speaker 1: Juliana case, which was the original youth plaintiff case, the
Speaker 1: plaintiffs in that case have gone back to the Federal
Speaker 1: District Court in Oregon and asked Judge Akin to reopen
Speaker 1: the case. It was dismissed by the Ninth Circuit. But
Speaker 1: the planets are trying to get Judge Akin to allow
Speaker 1: them to amend their complaints and narrow the scope of
Speaker 1: remedies so that, you know, something that courts can actually do.
Speaker 1: And Judge Akin has ordered the party's into mediation. That
Speaker 1: means the Justice Department and Our Children's Trust, which represents
Speaker 1: these plantiffs in the mediation. So you know, that's another
Speaker 1: piece of the puzzle. But generally, climate litigation is not
Speaker 1: going forward in any significant way in the United States.
Speaker 1: There's a lot of cases that are challenging individual fossil
Speaker 1: fuel projects, coal mines, oil and gas releases, pipeline you know,
Speaker 1: we're seeing that all the time. But but we're not
Speaker 1: seeing any of the kinds of cases that the Shell
Speaker 1: decision indicates, or this German Constitutional Court decision I mentioned
Speaker 1: indicate we're not seeing anything on that level. In the
Speaker 1: United States. There was an instance of a first time
Speaker 1: activist shareholder with a tiny steak in Exon scoring a
Speaker 1: historic win with getting two seats on the board. So
Speaker 1: is it more from within that we're going to see
Speaker 1: change than from the courts? Yeah? That was that was
Speaker 1: remarkable because you know, usually corporations at their annual meeting
Speaker 1: are able to squash these shareholder petitions. But in this case,
Speaker 1: these these shareholder activists, You're right, we're able to get
Speaker 1: two seats um on the board. Now that doesn't mean
Speaker 1: they're going to change Xon, but it's certainly is an
Speaker 1: inroad into what has been a closed shop or a
Speaker 1: closed board for the activists. And you're also seeing more
Speaker 1: and more in the financial sector increasing concerns and comments
Speaker 1: about the financial risks of all this investment in fossil fuels.
Speaker 1: We saw that with black Rock, you know, the largest
Speaker 1: brokerage firm that has over what seven trillion dollars in
Speaker 1: its portfolio, that the head of black Rock saying they're
Speaker 1: gonna they're they're shifting their focus to sustainability and investments
Speaker 1: in you know, newer, cleaner technologies and so forth. So
Speaker 1: an awful lot happening on the climate front. So I
Speaker 1: want to turn to the Biden administration because environmentalists had
Speaker 1: expected a complete reversal of Trump era legal positions, but
Speaker 1: they've been disappointed in the first months of the Biden administration.
Speaker 1: Politics in truths, Reality and truths. Yeah, Biden is facing
Speaker 1: tensions from both sides. On the left, sort of progressives
Speaker 1: in the climate activists. You know, they want an end
Speaker 1: to oil and gas development right now. They want to
Speaker 1: stop all the pipelines. They want to stop oil and
Speaker 1: gas development everywhere. And Biden during the campaign made some
Speaker 1: promises which he's finding hard to keep. You know, He's
Speaker 1: shut down the Keystone pipeline and that true, I don't know,
Speaker 1: several hundred or thousands of workers out of work, and
Speaker 1: so he took a shot from the unions on that.
Speaker 1: And now most recently, the Justice Department has gone into
Speaker 1: this case in Alaska in the Arctic Petroleum Reserve and
Speaker 1: defended the decision of the Trump administration to open up
Speaker 1: the Arctic. The scuttle butt on that is that Biden
Speaker 1: feels like he owes Lisa Murkowski, you know, one of
Speaker 1: the few Republicans who ever agrees with anything that the
Speaker 1: Democrats in the Senate want to do and what Biden
Speaker 1: would like to do with his infrastructure bill and all
Speaker 1: these big investments. So apparently, you know, he's having to
Speaker 1: cut these deals and balance the left and the right
Speaker 1: and the way he's executing his climate policy. I will say, overall,
Speaker 1: Biden is moving in the right direction. He's not moving
Speaker 1: as aggressively as we'd hoped, but he is moving in
Speaker 1: the right direction, and he's making climate a centerpiece of
Speaker 1: his policy, foreign policy, domestic policy, fiscal policy. He is
Speaker 1: following through on that. But yeah, he's going to break
Speaker 1: some hearts along the way on the phrase. Also some
Speaker 1: of the positions that the Justice Department is taking. For example,
Speaker 1: in April, government lawyers pushed the court to leave intact
Speaker 1: a Trump error rule designed to speed up reviews under
Speaker 1: the National Environmental Policy Act and argue that the Neeper
Speaker 1: rule didn't harm environmental groups anyway. So are the positions
Speaker 1: that they're taking sort of astonishing for this administration. That
Speaker 1: one really troubles me because it's pretty obvious that those
Speaker 1: NIPA rules are allowing projects to be approved without the
Speaker 1: kind of rigorous examination of their impact. Not just on climate,
Speaker 1: but on environment broadly, wildlife, habitat, air quality, water quality,
Speaker 1: and so forth. And yeah, I mean the Biden administration
Speaker 1: went into court and told the court, let's leave these
Speaker 1: NEIPER rules on the book while we think about how
Speaker 1: to change them. And the environmentals were saying, well, no,
Speaker 1: we need to get these rules off the books. We're
Speaker 1: not going to end up with these rules, so why
Speaker 1: leave them in place? Right? So that's a curious one.
Speaker 1: And we've not heard any explanation from the Council on
Speaker 1: Environmental Quality, which is, you know, the the entity that
Speaker 1: actually manages the NIPA process. Haven't heard any explanation for
Speaker 1: why the administration is taking that position and why frankly,
Speaker 1: they're not moving more aggressively to replace those rules. They're
Speaker 1: doing something similar with the rules under the Clean Water Act,
Speaker 1: which we know are are really bad rule because according
Speaker 1: to data that the Core of Engineers has developed, the
Speaker 1: Trump Rule, which revised the scope of protection under the
Speaker 1: Clean Water Act, has threatened of the waters in the
Speaker 1: United States and over fifty of the wetlands. So we
Speaker 1: know those rules are no good for the environment. And
Speaker 1: yet again the Biden administration is telling the courts, don't vacate,
Speaker 1: don't overturn the Trump rules. We're going to engage in
Speaker 1: in what Administrator Reagan has called a stakeholder process and
Speaker 1: try to reach some agreement with the opponents of the
Speaker 1: Clean Water Act rules that the Obama administration had adopted.
Speaker 1: So yeah, I mean, it's just gonna be a situation
Speaker 1: where the Biden administration is going to be weighing each
Speaker 1: one of these issues, apparently with an eye towards the
Speaker 1: politics and eye towards of course they have to do
Speaker 1: legally to make these changes. But um, they're slowing down,
Speaker 1: They're slowing down. How much of this is the politics
Speaker 1: as you talked about the oil leases in Alaska, and
Speaker 1: how much is it not wanting to overturn what a
Speaker 1: prior administration did. Well, some of it is is legally
Speaker 1: is being you know, thought about in terms of will
Speaker 1: the courts go along with the rapid and sort of
Speaker 1: wholesale reversal of the Trump policies. I mean, you have
Speaker 1: to remember Trump has now I think two hundred and
Speaker 1: forty of his judicial appointments are on the federal bench,
Speaker 1: and of course we know three of them are on
Speaker 1: the Supreme Court. So there is some legitimacy to the
Speaker 1: Biden administration and the Department of Justice proceeding with some caution,
Speaker 1: you know, as they make these changes, but leaving some
Speaker 1: of these rules in place with no announced deadline by
Speaker 1: which they're going to be changed. That's that's concerning, I
Speaker 1: would say, And it may be that as partly due
Speaker 1: to getting staffed up at these various agencies. I mean,
Speaker 1: we don't yet have uh, the new head of the
Speaker 1: Department of Justice Environmental Section approved this um. This individual
Speaker 1: named Kim has been nominated, but but you know, with
Speaker 1: everything else going on in Congress, he hasn't been confirmed yet,
Speaker 1: So we don't really have one of the key people
Speaker 1: in the Biden administration that has to oversee all this litigation,
Speaker 1: you know, that's going to be required to get resolved
Speaker 1: in order for the Biden rules to finally take effect.
Speaker 1: We've talked about the oil leases in Alaska before, and
Speaker 1: I have to say I was very surprised because I
Speaker 1: thought that was one of the things the Biden administration
Speaker 1: would immediately try to get out of. And you know,
Speaker 1: the thing of it is that that kind of a
Speaker 1: decision has such a long, uh lead time. I mean
Speaker 1: that they're going to be developing that oil and gas
Speaker 1: for a very long time, thirty years maybe, So it's
Speaker 1: not just a one off deal. It's a major deal, um.
Speaker 1: And it has all kinds of environmental justice impact because
Speaker 1: of the opposition not uniform, but but a lot of
Speaker 1: opposition from the native villages up there. Oh yeah, that
Speaker 1: was that was a bad one. So all those oil
Speaker 1: leasts are going through, or just some of them, just
Speaker 1: some of them. It's just it's just this one particular.
Speaker 1: And it's true that this this National Petroleum Reserve was
Speaker 1: set up, of course to develop the oil and gas.
Speaker 1: That's the whole point of it. So you know, I
Speaker 1: get that. Um. You know, the administration would be you know,
Speaker 1: they be risking perhaps some legal vulnerability if they were
Speaker 1: to completely uh you know, prohibited. But but they went
Speaker 1: in and defended, um, the work that the Trump administration
Speaker 1: had done under NIAPA under the Endangered Species Act um.
Speaker 1: And um, you know, from what I have read anyway,
Speaker 1: there's a lot of reason why that those environmental assessments
Speaker 1: are not good and need to be redone and at
Speaker 1: least that Biden administration could have agreed to do that,
Speaker 1: but it went in and defended, you know, right down
Speaker 1: the line everything that had been done by Trump. Thanks
Speaker 1: so much, Pat. As always, that's Professor Pat Parento of
Speaker 1: the Vermont Law School. And that's it for this edition
Speaker 1: of the Bloomberg Law Show. Remember you can always at
Speaker 1: the latest legal news on our Bloomberg Law Podcast. You
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Speaker 1: dot Bloomberg dot com, slash podcast, slash Law. I'm June
Speaker 1: also and you're listening to Bloomberg