Environmental law groups encouraging lawsuits against 'big oil'
Class actions related to climate change have multiplied around the world in recent years, and it is only a matter of time before we see more of these lawsuits in Canada, lawyers at Blake, Cassels & Graydon LLP say.
“If the trends outside of Canada are any indication, we will see more class action suits here,” says Karine Russell, a partner based out of Vancouver with expertise in defending class actions and cases involving product liability, consumer protection and competition.
Russell says these are “big and complicated cases” launched by citizens’ groups, environmental organizations and even government bodies such as municipalities. “As this trend becomes more common in Canada, companies who do business here should be aware and prepared.”
She points to some notable cases outside of Canada, which include:
- Multnomah County vs Exxon et al. Just a few weeks ago, Oregon’s largest county filed a suit against a long list of large, international fossil fuel companies seeking more than $51.5 billion in a case that alleges the 2021 “heat dome” experienced in North America was a direct and foreseeable consequence of selling oil and gas.
- Held v. Montana is a case where 16 young residents of the State of Montana have filed an action against the state alleging that pro-fossil fuel policies contribute to climate change and violate provisions in the state constitution. The court reserved its decision following a recent trial.
- Anton Foley and others v. Sweden (Aurora Case). Late last year, a class action was filed under the European Convention on Human Rights against Sweden for its alleged failure to mitigate climate change adequately. They claim that the violations result from Sweden’s failure to take necessary measures to mitigate climate risk and prevent global temperatures from exceeding 1.5°C above pre-industrial levels.
- Milieudefensie et al. v. Royal Dutch Shell plc. Seven Dutch non-governmental organizations and more than 17,000 individuals sued Royal Dutch Shell, alleging that its contributions to climate change violated its duty of care under Dutch law and international human rights obligations. The Hague District Court ordered Shell to reduce its greenhouse gas emissions by 45% by 2030, relative to the reference year 2019. An appeal is currently pending.
Turning from governments to corporations
While climate change class actions have arrived in Canada, to date, they have only been against the government and not against corporations, Russell says. However, given the activity in this area outside Canada, “private law class actions against corporations for allegedly causing or contributing to climate change are likely not far behind.”
In British Columbia, for example, some municipalities have already discussed fundraising for a potential class action against large oil and gas companies, claiming damages for climate change adaptation or mitigation costs.
This proposed BC municipalities class action is part of a larger campaign by West Coast Environmental Law (WCEL), an advocacy group promoting a campaign to demand accountability from fossil fuel companies - not just BC-based defendants, but national or multi-national corporations).
WCEL is campaigning for BC municipalities to join and has been presenting to city councils to persuade them to support their cause.
As a preliminary step, the WCEL campaign has had some municipalities in BC (Whistler, for example) send letters to oil and gas companies demanding compensation to cover the costs of alleged climate change harms. Victoria, Gibsons, View Royal and Vancouver have indicated support for this class action. Vancouver city council even voted to set aside $1 per resident to finance such litigation, but a newly elected council reversed that decision.
Blakes partner Simon Seida, based in Montreal, points out that there have already been some class action suits involving climate change in Quebec. One relates to “dieselgate” – when Volkswagen AG and several of its Canadian subsidiaries settled for more than $2 billion following allegations it misrepresented the tailpipe emissions of certain diesel-powered vehicles for model years 2009 to 2015 as being “cleaner” than they were.
However, the Association québécoise de lutte contre la pollution atmosphérique, a provincial environmental group, launched a class action, saying all Quebecers were victims of pollution generated by the company’s vehicles. The Quebec supreme court approved the class action, and the case eventually settled for $6.7 million in 2022.
Another case involved a Quebec non-profit organization dedicated to environment education, ENJEU (or ENvironment JEUnesse) filed a motion for authorization to institute a class action at the Quebec Superior Court against the federal government on behalf of Quebec residents aged 35 and under. The plaintiffs were unsuccessful, with Seida saying it was deemed “too much of a political question and unjustifiable to be heard through a class action.” The Quebec Court of Appeal upheld the dismissal and leave to appeal to the Supreme Court of Canada was refused.
Seida notes that Quebec has its own Charter of Rights and Freedoms, which includes the right to a healthy environment. “So, if there is a breach of this statute, under the charter, it can lead to punitive damages,” he says. “While the legal theory has not been fully explored, the basis for a class action related to climate change already exists in the Quebec charter and our civil law.”
Using novel arguments in climate-change litigation
Russell says that while lawsuits such as these use novel arguments – for example, that younger people are disproportionately harmed by climate change and its future impact – it’s yet to be seen whether a suitable class action framework for these types of allegations will evolve.
These are complex chases that will take many years to settle, Russell says, and there’s a question of whether the issue of climate change requires more urgency.
“And then there’s the question about the role of the court versus the role of the legislature and whether these are issues that should be in the court or if our governments really are the ones who should be dealing with these issues.”
Seida says that as these cases become more common in Canada, regulatory clarity is needed “because one defence that will likely be raised in these suits is that companies have been complying with all environmental regulations – so how can plaintiffs claim that more should be done than what the law already provides.”
Russell adds that corporations seek clarity to understand better Canada’s legal landscape and the jurisdictional differences within provinces and territories on climate issues.
While getting monetary compensation is often the goal of launching a class action suit, Russell and Seida note other reasons, ranging from gaining media attention and highlighting environmental issues to helping raise funds.
In British Columbia, class action legislation provides that BC is generally a no-cost regime, says Russell, “so if a plaintiff is unsuccessful, they may be shielded from paying a substantial cost award.”
As for awards, while class lawsuits can involve payments to individual class members, often, the money can be used differently. For example, Seida says that with the Volkswagen settlement, the judge approved a suggestion that the money go to an environmental protection group.
