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Second federal judge blocks New York's climate superfund law

Second federal judge blocks New York's climate superfund law

Rule Changes

Two courts rule the $75 billion cost-recovery plan is preempted by federal authority over interstate emissions

Today: Second judge issues permanent injunction

Overview

Updated 1 hour ago

A second federal judge has blocked New York's Climate Change Superfund Act, the state's bid to collect $75 billion from fossil fuel companies for climate adaptation costs. Judge P. Kevin Castel issued a permanent injunction, ruling the law is preempted because it regulates interstate and foreign greenhouse gas emissions.

The ruling comes three weeks after a different New York federal court reached the same conclusion. Together, the decisions close off a strategy that Vermont and other states were pursuing to make energy companies pay retroactively for emissions tied to climate change.

Why it matters

If these rulings survive appeal, states cannot force fossil fuel companies to pay for past emissions, ending a major climate cost-recovery strategy.

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Key Indicators

$75 billion
Amount New York sought from fossil fuel companies
The sum the Climate Change Superfund Act would collect for climate adaptation infrastructure.
2
Federal rulings against the law
Rulings from the Southern and Northern Districts of New York, both finding the law preempted.
20+
States that sued to block the law
A coalition of states joined the February 2025 federal lawsuit challenging the Act.

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People Involved

Organizations Involved

Timeline

April 2021 October 2026

7 events Latest: Today
Tap a bar to jump to that date
  1. New York enacts Climate Change Superfund Act

    Legislation

    Governor Kathy Hochul signed the law targeting $75 billion in payments from fossil fuel companies for climate adaptation.

Scenarios

1

Second Circuit upholds the rulings, superfund law stays dead

Likely Resolves by Q3 2027

Discussed by: Jones Day, the National Law Review, and the Justice Department

The Second Circuit already held in 2021 that federal law governs interstate emissions claims. Both district courts cited that precedent directly. An appeal faces a steep uphill climb unless the Supreme Court intervenes first.

2

Supreme Court's Suncor ruling revives state climate claims

Possible Resolves by Q2 2027

Discussed by: National Law Review

Oral argument in Suncor Energy v. Boulder County is set for October 5, 2026. If the Court rules that states can pursue climate liability claims, it could erode the displacement reasoning behind both New York rulings and energize the appeal.

3

States rewrite climate cost-recovery laws to survive review

Possible Resolves by End of 2027

Discussed by: Mondaq, Jones Day

The rulings leave room for narrower state laws tied to emissions or conduct within state borders. Vermont's law is already under federal challenge, and other states weighing similar measures may wait to see how this appeal and the Suncor case resolve before drafting new versions.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

December 1980

Superfund / CERCLA (1980)

Congress passed the Comprehensive Environmental Response, Compensation, and Liability Act, creating a fund to clean up hazardous waste sites funded by retroactive polluter liability.

Then

The Environmental Protection Agency gained authority to force polluters to pay for cleanup.

Now

CERCLA became the template for state 'superfund' laws, including New York's climate version targeting greenhouse gas emissions.

Why this matters now

New York borrowed the name and the cost-recovery structure from the federal hazardous waste program and applied it to fossil fuel emissions.

June 2011

American Electric Power v. Connecticut (2011)

Six states and environmental groups sued electric utilities over greenhouse gas emissions, seeking court-ordered caps. The Supreme Court ruled that the Clean Air Act displaced federal common law on interstate air pollution.

Then

The lawsuit was dismissed and the emissions caps never imposed.

Now

Established that the federal government, through the Clean Air Act, holds primary authority over interstate greenhouse gas emissions.

Why this matters now

That displacement doctrine is the legal foundation for both New York rulings against the superfund law.

April 2021

City of New York v. Chevron Corp (2021)

New York City sued Chevron, Exxon Mobil, and other energy giants for the costs of climate adaptation. The Second Circuit dismissed the claims, ruling federal law preempts them.

Then

The case was dismissed and the city collected nothing.

Now

The decision became binding precedent in the Second Circuit, which the two district judges cited heavily when striking down the 2024 superfund law.

Why this matters now

Both courts found "very little daylight" between the 2021 claims and the $75 billion statutory scheme.

Sources

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