This term, the Supreme Court has the opportunity to address a troubling trend in U.S. law: the increasing use of the legal system to target American energy production, often fueled by government-backed lawsuits.
Two significant cases, Chemron v. Plaquemines Parish and Suncor vs. Boulder County, present a chance for the Court to restore constitutional integrity and safeguard America’s energy workforce, economic interests, national security, and the essential rule of law.
For over a decade, Louisiana has embarked on a risky practice of outsourcing government enforcement, granting authority to private attorneys who operate on fee-shift arrangements. This has triggered a significant wave of state and local lawsuits aimed at numerous energy producers.
The lawsuits claim that coastal erosion in Louisiana can be traced back to energy production from the 1940s, much of which was conducted under federal permits or wartime directives supporting the U.S. war effort.
Defendants have tried to move these cases to federal court via the Federal Employees Removal Act, but increasing inconsistencies among federal circuit courts have led to years of litigation bouncing between state and federal jurisdictions. The Supreme Court’s involvement is crucial to resolving these circuit disputes and ensuring federal contractors are safeguarded against state court biases, particularly those linked to wartime activities.
A jury verdict of $745 million has prompted over 40 similar lawsuits this year, which could potentially cost billions. Reports estimate that Louisiana’s economy has suffered losses of between $44 million and $113 million annually because of these lawsuits, with more than 2,000 jobs disappearing within the first two years of legal battles. Additionally, state and local governments have lost up to $22.6 million annually in royalty revenue—money that could have supported essential services like schools and roads.
Worryingly, the structural issues of these lawsuits appear to be even more alarming than the financial implications. Trial attorneys, representing various parishes, have reached an agreement with the state that prevents it from mounting substantive defenses, no matter their validity. Essentially, Louisiana has relinquished its investigative and prosecutorial responsibilities to private lawyers who then collect substantial fees.
As a former secretary of the Louisiana Department of Natural Resources admitted, the state has abandoned its enforcement processes and shifted its responsibilities to a select group of politically connected litigators.
This arrangement is in direct conflict with fundamental constitutional principles.
At the same time that private attorneys are authorized to pursue legal claims for the state, the integrity of justice is compromised by politically active judges. Records indicate that attorneys leading these cases have contributed over $2.5 million in support of judicial selections since 2012. This situation directly contradicts the intent of the Federal Official Removal Act, which aims to prevent local courts from adjudicating claims made by private parties on behalf of the federal government, especially when local judicial interests may intersect with financial gains.
The Trump administration concurs. U.S. Attorney General John Sauer emphasized to the Supreme Court that these cases rightly belong in federal court.
Sauer noted, “During World War II, the oil industry functioned as a unique public-private coalition, overseen by the War Petroleum Administration.” This relationship supports the removal of lawsuits challenging wartime production practices.
Sadly, this troubling trend isn’t isolated to Louisiana. In Suncor vs. Boulder County, the Pelican Institute, along with the Manhattan Institute and others, contends that Boulder’s efforts to use state tort law to regulate global greenhouse gas emissions go against the principle of federalism.
Permitting these lawsuits to proceed grants one state authority over national energy policy—something the Constitution wisely reserves for Congress, not state or local entities.
If the courts allow this litigation model to persist, it signals to states that they can bypass democratic processes by hiring outside attorneys to create innovative legal frameworks.
Energy companies now risk retroactive liability for activities sanctioned at the federal level. Tomorrow, any sector could fall out of favor politically.
The Framers of the Constitution aimed to thwart local biases against interstate commerce and the concentration of prosecutorial power in private hands, as well as the misuse of courts to achieve what Congress has not.
America’s prosperity relies on the rule of law—not merely the machinations of lawyers. The Supreme Court must decisively overturn these decisions and reaffirm that our constitutional framework cannot tolerate turning the judiciary into a profit-driven enterprise. Our economic stability, national security, and energy future hinge on it.
