Eakinomics was not always on SCOTUS watch. But in recent years the U.S. Supreme Court has delivered decisions central to federal policymaking, ranging from Loper Bright Enterprises v. Raimondo to Learning Resources, Inc. v. Trump. Monday, the Court heard arguments in Suncor Energy (U.S.A.) Inc. v. County Commissioners of Boulder County (“Suncor”). AAF’s Shuting Pomerleau and Misha Mazalevskyi cover the issue in detail; here are the highlights.

As the authors summarize the history:

In 2018, the City and County of Boulder filed a lawsuit in Colorado state court against Suncor Energy (a Canadian oil producer that operates the only two refineries in Colorado) and ExxonMobil (the largest U.S. energy company). The municipalities sought financial compensation for local climate adaptation costs under the state tort law, alleging two wrongdoings by the defendants: 1) Suncor’s and ExxonMobil’s fossil fuel products contributed to climate change; 2) the companies engaged in deceptive marketing regarding the effects of GHGs.

Given this background, one might be tempted to think this case is only about climate change. It is not. At the heart of the matter is whether SCOTUS has the authority to weigh in on the case (as the state court’s ruling is not final) and whether a federal law (the Clean Air Act) and federal common law (precedents set by previous court rulings) can preempt state tort claims regarding greenhouse gas emissions (and perhaps more). As the authors emphasize:

The case has received tremendous interest from Congress and government agencies, with almost 200 congressional members and more than 40 states signed on to amicus briefs siding with either Suncor and ExxonMobil or Boulder. The Court’s ruling would affect dozens of other similar lawsuits pending around the country and determine whether state and local governments have the authority to sue fossil fuel companies on the ground of climate change damage.

The federal-state tensions are built into the Constitution by design and negotiating them is among the most difficult legislative tasks. This case will set the boundaries for legislation at both levels of government. In short, it will be one of the Court’s most important decisions of the term.