Feud over car defects could affect climate law

Source: By Pamela King, E&E News reporter • Posted: Thursday, October 8, 2020

A Supreme Court battle over the proper venue for a motor vehicle defect liability case soon could ripple through legal efforts by local governments to get Big Oil to pay for climate impacts.

The nation’s highest bench heard arguments yesterday in Ford Motor Co. v. Montana 8th Judicial District Court, in which the Michigan-based automaker argued that a court in the Treasure State was not the proper home for litigation stemming from a 2015 car accident that killed Montana resident Markkaya Jean Gullett.

Ford argued that the Montana courts did not have specific personal jurisdiction simply because Gullett’s accident took place in the state — a position that, if the Supreme Court accepts it, could throw a wrench into lawsuits by Rhode Island, Baltimore, and other cities and states seeking compensation from the energy industry for its contributions to climate-induced flooding, wildfires and storms.

“When you’re dealing with these big multinational corporations, one of the ways they’ve avoided being held accountable is manipulating where they can be sued,” said Bob Percival, director of the University of Maryland’s environmental law program.

Proceedings in at least one climate case — filed by Rhode Island against Chevron Corp. and other firms — are on hold pending the outcome of Ford Motor.

During oral arguments yesterday, the justices appeared skeptical of Ford’s position that it could not be sued in Montana — an argument the company lost in the state’s highest court.

“Since they do a lot of business with the same kinds of cars there, they have to be prepared to defend against this kind of suit,” Justice Stephen Breyer told an attorney for the company. “So what’s unfair about it?”

Hogan Lovells partner Sean Marotta said the Montana Supreme Court’s decision leaves Ford vulnerable to the whims of various states’ judges, juries, and rules of evidence and procedure.

“And even if you don’t think that’s a significant burden on Ford because Ford’s a big company, the rule you’ll announce in this case applies to much smaller manufacturers,” Marotta said.

Ford faces claims of design defect, failure to warn and negligence for Gullett’s accident, which occurred when the tread on one of the tires on her Ford Explorer separated, causing the vehicle to roll into a ditch along a Montana highway.

“All that respondents add is that they are forum residents injured in the forum state,” Marotta said.

Ford’s argument “turns personal jurisdiction into a game,” said Gupta Wessler PLLC founder Deepak Gupta, who argued on behalf of Gullett’s estate.

“The defendant can cut off access to the court not because the forum state overreached or because fairness compels it but simply because it makes it harder for people to get access to justice.”

Gupta noted that a bipartisan coalition of 40 state attorneys general supported the Montana Supreme Court’s finding.

Percival of the University of Maryland said the case is unlikely to be decided along ideological lines.

He also highlighted a separate plea in which Exxon Mobil Corp. asked the Texas Supreme Court to relax personal jurisdiction requirements so it could sue the California cities and counties that are seeking climate damages from the company.

A Texas appellate court ruled this summer that despite the bench’s “impulse to safeguard an industry that is vital to Texas’ economic well-being,” the potential California defendants did not have enough ties to the Lone Star State to be subject to its jurisdiction.

Exxon and other oil giants have pushed back against climate challenges in other ways.

Industry attorneys also have argued that climate lawsuits from local governments belong not in state court but in federal benches, where precedent indicates that the companies might prevail.

Judges have largely determined that the cases should be heard in state venues, but the Supreme Court last week agreed to probe a wonky doctrinal question that could make it easier for energy firms to argue that the lawsuits belong in federal court (Climatewire, Oct. 5).

The Supreme Court will hear arguments in the case, titled BP PLC v. Mayor and City Council of Baltimore, later this term.