Supreme Court Hears Major Climate Case Over Local Lawsuits Against Oil Companies

The U.S. Supreme Court heard arguments Monday in a major climate change case that could determine whether cities and states can use state law to seek damages from fossil fuel companies for the effects of climate change.

The case involves the city and county of Boulder, Colorado, which is seeking billions of dollars from ExxonMobil and Suncor Energy. Boulder argues the companies contributed to climate change and misled the public about the effects of fossil fuels. The local governments are seeking compensation for costs associated with wildfires, flooding and public health effects (Fritze, 2026).

At the center of the case is a question over whether claims involving carbon emissions can proceed under state law or whether the issue is exclusively governed by federal law.

Exxon and Suncor argue that carbon emissions are inherently a federal issue because emissions cross state and international borders. Boulder argues that its lawsuit is based on state tort law and that federal law does not prevent the claims from proceeding.

The arguments come as dozens of other cities have filed similar lawsuits against oil and gas companies, meaning the Supreme Court's eventual decision could have consequences beyond Colorado. A decision is expected next year (Fritze, 2026).

Several justices questioned how allowing individual cities and states to pursue such claims could affect litigation nationwide.

Justice Brett Kavanaugh pointed to previous Supreme Court decisions involving state tort law and pollution, suggesting Boulder faced significant precedent against its position.

“We’re on a wall of precedent that says state tort law does not apply,” Kavanaugh said during oral arguments (Fritze, 2026).

Chief Justice John Roberts also questioned what could happen if Boulder succeeds and municipalities across the country begin filing similar lawsuits.

“Presumably, if you prevail, the next day a municipality in every single state will file a lawsuit,” Roberts said (Fritze, 2026).

However, Roberts also questioned parts of the oil companies' argument, noting that state courts sometimes hear cases involving conduct outside their borders that creates effects within the state.

Boulder has compared its case to lawsuits brought against tobacco companies in the 1990s. Those cases included allegations that companies deceived consumers about the health consequences of their products and ultimately resulted in a large settlement.

Boulder similarly alleges Exxon and Suncor misled the public about the harmful effects of fossil fuels in addition to contributing to climate change (Fritze, 2026).

Justice Elena Kagan questioned why the climate lawsuit should be treated differently from the tobacco litigation.

“This is the same kind of lawsuit, against the same kind of actor for the same kind of harm,” Kagan said (Fritze, 2026).

Another issue before the court is whether the justices should decide the broader legal question at this stage of the case.

Justice Ketanji Brown Jackson suggested the dispute may have reached the Supreme Court too early because litigation remains in its early stages.

“We’re really early in this case,” Jackson said. “This is sort of premature from the standpoint of this court exercising its jurisdiction” (Fritze, 2026).

Justice Clarence Thomas also questioned whether the Supreme Court should wait until a later stage of the litigation before resolving the federal issues involved.

The case is also unusual because Justice Samuel Alito recused himself and did not participate in Monday's arguments. Alito told Bloomberg News that he considered recusal “prudent” because of his holdings in energy stocks, although the companies in which he owns stock are not parties in the case (Fritze, 2026).

His absence leaves eight justices to decide the case and creates the possibility of a 4-4 split. If that happens, the Colorado Supreme Court decision allowing Boulder's lawsuit to move forward would remain in place, but the outcome would not create a nationwide Supreme Court precedent (Fritze, 2026).

The case opened a new Supreme Court term and represents one of the most significant climate-related disputes to reach the court in years.

The justices could issue a broad ruling determining whether state and local governments can pursue these types of climate lawsuits, or they could resolve the dispute more narrowly by finding the case is not yet ready for Supreme Court review.

Whatever approach the court takes could influence similar lawsuits already being pursued by local governments across the country.

A decision is expected in 2027.