Key facts
- A federal judge ruled New York cannot enforce its Climate Change Superfund Act.
- The law sought to collect $75 billion over 25 years from energy producers.
- The judge found the state law was preempted by federal law.
- The ruling cited conflicts with federal interests in regulating air pollution and foreign affairs.
- The lawsuit was brought by Republican state attorneys general and industry groups.
A federal judge has ruled that New York cannot enforce its Climate Change Superfund Act, a law enacted in 2024 that aimed to compel oil companies to contribute $75 billion over 25 years to a fund for climate change damages. Chief U.S. District Judge Brenda Sannes sided with a coalition of Republican state attorneys general and industry groups, including the U.S. Chamber of Commerce and American Petroleum Institute.
In her written ruling, Sannes stated that the law was preempted by federal law, specifically citing conflicts with federal interests in applying uniform air pollution regulations under the Clean Air Act and the foreign affairs doctrine concerning international emissions. The judge noted that the law's attempt to regulate global emissions and impose liability for conduct beyond New York's borders was problematic.
The challengers argued that the law was an unconstitutional power grab and a "repackaging of the same argument" previously rejected by the Second U.S. Circuit Court of Appeals in a similar case against New York City. New York had countered that the law did not infringe on federal matters as it did not explicitly force companies to reduce production or emissions.
West Virginia Attorney General JB McCuskey, whose state was among the first to challenge the law, hailed the ruling as a major victory against "liberal states" attempting to balance budgets by penalizing energy producers. The ruling is the first on this issue, and similar legislation is pending in other states.