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Friday, June 30, 2017

Merchants of death have a lot in common

Can the tobacco and fossil fuel industries be compared?
By Ali Abel, Faculty of Law

Image result for Can the tobacco and fossil fuel industries be comparedAre there similarities between the tobacco industry and the fossil fuel industry when it comes to legal liability?

Could, for example, energy companies that rely on fossil fuels and emit greenhouse gases be held accountable for the damage caused by climate change?

Two researchers in the Faculty of Law have set out to answer these important questions.

Professors Sharon Mascher and Martin Olszynski, along with co-author Meinhard Doelle of the Schulich School of Law at Dalhousie University, have written the paper, From Smokes to Smokestacks: Lessons from Tobacco for the Future of Climate Change Liability, which will be published in the Georgetown Environmental Law Review.

The research builds on a growing collection of work in the literature on the responsibility of corporations, and particularly what are sometimes referred to as the carbon majors, for a share of the costs associated with climate change.

Mascher, Olszynski and Doelle began by exploring the unique story of tobacco litigation and liability, and specifically the decision by several U.S. states (followed shortly thereafter by most Canadian provinces) to sue the tobacco industry directly for the public health-care costs of tobacco-related disease. In stark contrast to previous waves of tobacco litigation by private individuals, which were almost universally unsuccessful, in the U.S. this decision led to a $350-million settlement.

“We asked ourselves whether similar developments might be possible in the future if, as a result of society’s failure to adequately address the climate change problem, governments at all levels are faced with record public costs to remediate the resulting damage, such as damage from increased floods, droughts and fires, and to adapt to new climatic regimes,” says Mascher.

“While there are important differences between the two contexts (tobacco and climate change), the comparison is actually quite appropriate from a legal perspective.”

Energy companies need to be proactive about assessing risk

One of the key takeaways for the fossil fuel industry — which the researchers define as not just oil and gas producers, but also the manufacturers of products that consume fossil fuels, such as car companies — is to recognize that the risk of future civil liability is probably greater than they assumed, and to start adjusting their behaviour accordingly.

“The basic issue for industry is to define and then meet the standard of care, which is conventionally assessed by measuring the magnitude and probability of harm against the burden of avoiding or mitigating such harm, recognizing that this may entail some loss of profits, as was the case with tobacco,” says Olszynski.

“Gasoline retailers and car makers may want to start warning the public more openly about the risks of fossil fuel consumption, and to re-evaluate their marketing strategies with respect to high-emission vehicles. Oil and gas producers may want to scrutinize their operations to ensure best available technologies are being adopted wherever possible and that research and development dollars are directed towards lower, or no, emitting technologies.”

“Industry needs to think about risk differently, in a way that informs what they are doing today, but also informs how they will operate in the future,” says Mascher.

Research funding was provided by the University of Calgary through a Starter Grant, a University Research Grant Committee Seed Grant, and an Enhancement Grant.