An article yesterday in the Australian newspaper The Age quotes Australian “climate change lawyer” Renee Garner as predicting a trend in securities class actions for companies’ failure to disclose information about their carbon output, information that she says will arguably impact on a company’s value given the likely implementation of a Carbon Pollution Reduction Scheme in Australia.
Earlier this month, the Australian government issued a green paper recommending the implementation of a “Carbon Pollution Reduction Scheme” as early as 2009. See this article at Mondaq.com for a summary of the key points of the green paper. The implementation of these regulations seems essential to the possible securities theory suggested by Ms. Garner, since it would provide a more direct potential link between a company’s carbon output and its stock value. For the time being, this theory would not appear to be viable in the U.S. (that’s not to say it won’t be attempted). However, it may only be a matter of time before legislation involving carbon trading and offsets comes to the U.S., and with it may come climate change securities class actions.
As Ms. Garner also points out in yesterday’s article, climate change litigation against the EPA and other regulatory authorities has already been brought in the United States, as have mass tort cases alleging harm caused by greenhouse gas emissions. For an informative summary of litigation both in Australia and in the U.S. dealing with climate change issues, see this publication, available at Ms. Garner’s law firm, Freehills.