Business
Supreme Court denies oil industry plea to block climate lawsuits filed by California, other blue states
WASHINGTON — The Supreme Court dealt a major setback to the oil industry Monday, refusing to block lawsuits from California and other blue states that seek billions of dollars in damages for the effects of climate change.
Without a comment or dissent, the justices turned down closely watched appeals from Sunoco, Shell and other energy producers.
In Sunoco vs. Honolulu, the oil industry urged the justices to intervene in these state cases and rule that because climate change is a global phenomenon, it is a matter for federal law only, not one suited to state-by-state claims.
“The stakes could not be higher,” they told the court.
But none of the justices said they wanted to hear their claim, at least not now.
The decision clears the way for more than two dozen suits filed by states and municipalities to move forward and try to prove their claim that the major oil producers knew of the potential damage of burning fossil fuels but chose to conceal it.
“Big Oil companies keep fighting a losing battle to avoid standing trial for their climate lies,” said Richard Wiles, president of the Center for Climate Integrity. “With this latest denial, the fossil fuel industry’s worst nightmare — having to face the overwhelming evidence of their decades of calculated climate deception — is closer than ever to becoming a reality.”
Two years ago, California Gov. Gavin Newsom and Atty. Gen. Rob Bonta filed a lawsuit in San Francisco County Superior Court against five of the largest oil and gas companies — Exxon Mobil, Shell, Chevron, ConocoPhillips and BP — and the American Petroleum Institute for what they described as a “decades-long campaign of deception” that created climate-related harms in California.
“For more than 50 years, Big Oil has been lying to us — covering up the fact that they’ve long known how dangerous the fossil fuels they produce are for our planet,” Newsom said in announcing the suit.
In recent days, California officials have blamed climate change for the devastating weather conditions that contributed to the deadly wildfires that destroyed thousands of homes and other structures, leading to what many experts expect to become the costliest natural disaster in U.S. history.
California’s suit followed the pattern set by similar claims from the cities of Baltimore, New York, Chicago and San Francisco as well as blue states including Massachusetts, Connecticut, Rhode Island, New Jersey and Minnesota.
These suits argue that the oil producers used deceptive marketing to hide the danger of burning fossil fuels. Under state law, companies can be held liable for failing to warn consumers of a known danger.
In June 2024, the court asked the Justice Department to weigh in on the issue. In December, lawyers for the Biden administration urged the court to stand aside for now because the suits are at an early stage.
Justice Samuel A. Alito Jr. said he took no part in the decision to deny the appeals, presumably because he owns stock in companies affected by the dispute.
The climate change lawsuits were patterned after the successful mass lawsuits filed by states and others against the tobacco industry over cigarettes and the pharmaceutical industry over opioids.
Cigarettes and opioids were sold legally, but the suits alleged that industry officials conspired to deceive the public and hide the true dangers of their highly profitable products.
Under state law, plaintiffs can seek damages for broad and open-ended claims such as a failure to warn of a danger, false advertising or creating a public nuisance. All three claims are cited in California’s lawsuit. Federal law, by contrast, is usually limited to damage claims that are authorized by Congress.
Had the Supreme Court agreed to hear the oil industry’s appeal in the Hawaii case, it “would have frozen the cases for a year or more and could have resulted in a death blow for all of them,” said Patrick Parenteau, an environmental law expert at the Vermont Law School.
Los Angeles lawyer Theodore J. Boutrous Jr., who represents Chevron, said the company “will continue to defend against meritless state law climate litigation, which clashes with basic constitutional principles, undermines sound energy policy.”
Meanwhile, Alabama and 20 red states urged the court to throw out these blue-state lawsuits. They said liberal states and their judges should not have the power to set the nation’s policy on the energy industry. The court has not ruled on that claim yet.
The case dismissed Monday began five years ago when the city and county of Honolulu sued Sunoco and 14 other major oil and gas producers, alleging a failure to warn and creating a nuisance.
The Hawaii Supreme Court last year rejected the industry’s motion and refused to dismiss the suit.
“Simply put, the plaintiffs say the issue is whether defendants misled the public about fossil fuels’ dangers and environmental impact. We agree …. This suit does not seek to regulate emissions and does not seek damages for interstate emissions,” the state court said in a unanimous opinion. “Rather, plaintiffs’ complaint clearly seeks to challenge the promotion and sale of fossil-fuel products without warning and abetted by a sophisticated disinformation campaign.”
Early in April, Ruben Hallali got an unusual alert on his phone: The evening temperature at Paris Charles de Gaulle International Airport had jumped about 6 degrees Fahrenheit in seconds.
Mr. Hallali, the chief executive of the weather risk company Sereno, had set up notifications for extreme weather swings. Then, nine days later, it happened again.
“It was an isolated jump, at one single station, early in the evening,” said Mr. Hallali, who added that he noticed another strange coincidence about the spikes: The timing was just right for somebody to reap a windfall on the betting site Polymarket.
He wasn’t the only one who sensed a problem. Météo-France, the country’s national meteorological service, filed a complaint last week with the police and local prosecutors, saying it had evidence that a weather sensor at Charles de Gaulle, the country’s largest airport, may have been tampered with.
The temperature swings, experts said, coincided with a period of unusual activity on Polymarket, one of the leading online prediction markets, which allow users to wager on the outcome of virtually anything.
One increasingly popular area is weather betting, where speculators can make real-time wagers on temperature readings, rainfall totals, the number of Atlantic hurricanes in a year and much more — with payouts in the thousands of dollars and higher.
As the stakes rise, so has the temptation to tamper with the instruments used to generate weather readings in hopes of engineering a lucrative outcome. Experts warn that this could have dangerous ripple effects, like degrading the information that underpins safe air travel.
Temperature data is used in a host of calculations at airports, helping determine correct takeoff distance, climb rate and whether crews need to apply frost treatment to planes. It’s crucial to airport safety, Mr. Hallali said.
“The Charles de Gaulle incident is not an isolated curiosity,” Mr. Hallali said. “It is what happens when financial incentives meet fragile data infrastructure.”
On April 6, the temperature reading at Charles de Gaulle jumped from 64 degrees Fahrenheit to 70 degrees at 7 p.m., before slowly falling over the next hour, according to data from Météo-France.
On April 15, the recorded temperature climbed even more sharply, from 61 degrees at 9 p.m. to 72 at 9:30 p.m., then dropping back to 61 a half-hour later.
In both instances, the spikes set the high temperature for the day, the metric on which some Polymarket wagers rest.
Laurent Becler, a spokesman for Météo-France, said the service contacted the police after noticing the discrepancies in temperature data. He declined to comment further on the case, saying it was under investigation.
Mr. Hallali said that after the first instance, experts and commenters on the French weather forum Infoclimat began to search answers. Theories were floated, including user error. But after the second spike, commenters zeroed in on the unusual Polymarket wagers, which totaled nearly $1.4 million over the two days, according to the company’s data.
The sums bet on April 6 and 15 were hundreds of thousands of dollars higher than on typical days this month.
It is not the first time that strange bets on prediction markets have raised accusations of insider trading.
On Thursday, a U.S. Army special forces soldier who helped capture President Nicolás Maduro of Venezuela in January was charged with using classified information to bet on outcomes related to Venezuela, making more than $400,000 on Polymarket. Late last year, another trader on the site made roughly $300,000 betting on last-minute pardons from President Joseph R. Biden Jr. before he left office.
Polymarket did not immediately respond to a request for comment. While the site used to tie some bets to temperature readings at Charles de Gaulle, this week, after Météo-France filed its complaint, the platform began using temperatures taken at another airport near the city, Paris-Le Bourget, according to recent bets on the site.
Representatives for Charles de Gaulle airport declined to comment beyond saying that the case was under investigation. The airport police also declined to comment. The Bobigny Public Prosecutor’s Office, which is handling the case, declined to answer questions about the investigation but said that no complaint had been filed against Polymarket.
As to how the instruments could have been tampered with, a number of theories have been offered online, including by use of a hair dryer or a lighter. Mr. Hallali said that the precision of the spike on April 15 suggested the use of a calibrated portable heating device, although he declined to speculate about what kind.
“Markets are expanding into every domain where an outcome can be observed, measured, and settled,” he said. “As these markets multiply, so does the surface area for manipulation.”
As the war in Iran strangles the flow of oil around the globe, California’s jet fuel reservoirs are running low.
The state — which refines much of its own fuel in El Segundo and elsewhere but still relies on crude oil imports — has seen its jet fuel stock decline by more than 25% from last year’s peak to a level not seen since 2023, according to data from the California Energy Commission.
The supply is shrinking as a global shortage is already affecting travelers’ summer plans with canceled flights and higher fares. It could even affect plans for people coming to Los Angeles for the 2026 World Cup, which starts in June, said Mike Duignan, a hospitality expert and professor at Paris 1 Panthéon-Sorbonne University.
“People don’t know exactly how this is going to escalate,” he said. “There’s a huge black cloud over the sea for the World Cup and the travel slump that we’re seeing is all linked to this oil shortage.”
As fuel supplies shrink, flight prices are rising. Airlines are adding baggage surcharges to cover fuel costs. Several routes leaving from smaller California hubs, including Sacramento and Burbank, have already been canceled.
Air Canada has suspended flights for this summer, cutting routes from JFK to Toronto and Montreal.
“Jet fuel prices have doubled since the start of the Iran conflict, affecting some lower profitability routes and flights which now are no longer economically feasible,” the airline said in a statement last week.
Europe had just more than a month’s supply of jet fuel left last week, the International Energy Agency said. In an effort to cut costs, the German airline Lufthansa slashed 20,000 flights from its summer schedule this week.
Without a fresh oil supply flowing through the Strait of Hormuz, the situation is unlikely to improve, experts said. The oil reserves countries and companies have in storage are helping fill shortfalls, but the squeezed supply chain could still wreak economic havoc.
“When there’s a shortage somewhere, everything is affected,” said Alan Fyall, an associate dean of the University of Central Florida Rosen College of Hospitality Management. “Airlines are being cautious, and I would say that is a very wise strategy at the moment.”
California’s jet fuel stock reached its lowest levels in two and a half years at 2.6 million barrels last week, down from a peak of more than 3.5 million barrels last year.
The California Energy Commission, which tracks fuel inventory, said the state’s current jet fuel stock is sill sufficient.
“Current production and inventory levels of jet fuel are within historical ranges,” a spokesperson said. “Although supply is tight, no structural deficit has emerged yet. The present tightness reflects short‑term global market stress. As long as refinery operations remain stable, California is positioned to meet regional jet fuel needs.”
Europe has been affected more directly because it relies on the Middle East for the vast majority of its crude oil and many refined products, experts said. California gets crude oil from the Middle East but also from Canada, Argentina and Guyana.
The state has the capacity to refine around 200,000 barrels of jet fuel per day, most of it from refineries in El Segundo and Richmond.
The amount of crude oil originating in the state has been declining since the early 2000s, as state regulations and drilling costs have led to more imports.
California has become particularly vulnerable to supply-chain shocks like the war in Iran, says Chevron, one of the companies that provides jet fuel in the state.
“The conflict in the Mideast Gulf has exposed the danger of California’s decision to offshore energy production,” said Ross Allen, a Chevron spokesperson. “Taxes, red tape and burdensome regulations cost the state nearly 18% of its refinery capacity in just the past year, and we urge policymakers to protect the remaining manufacturing capacity.”
In 2025, 61% of crude oil supply to California’s refineries came from foreign sources, according to the California Energy Commission. Around 23% came from inside the state, down from 35% five years ago.
The state’s refining capacity has also been declining, said Jesus David, senior vice president of Energy at IIR Energy. The West Coast region’s refining capacity has decreased from 2.9 million to 2.3 million barrels a day since 2019, he said.
“California’s had issues prior to the war,” David said. “Nothing new has been built over the past 30 years, and California has closed a lot of capacity.”
The result is higher prices for both gasoline and jet fuel in the state. Jet fuel at LAX costs close to $15 per gallon this week, compared with almost $10 at Denver International Airport and $11 at Newark International Airport.
Gasoline prices have also been hit hard by the global conflict. Average gas prices in California are close to $6 a gallon, around $2 higher than the national average.
The West Coast is a “fuel island” because it’s not connected by pipelines to the rest of the country, United Airlines chief executive Scott Kirby said in an interview last month. That means oil and refined products have to be brought in by ships.
“Fuel price is more susceptible to supply weakness on the West Coast than anywhere else in the country,” Kirby said.
Some airlines might not survive the turmoil if oil prices don’t level out soon, he said. Spirit Airlines, a budget carrier based in Florida, is reportedly facing imminent liquidation if it isn’t bailed out by the Trump administration.
Nike is cutting about 1,400 jobs in its operations division, mostly from its technology department, the company said Thursday.
In a note to employees, Venkatesh Alagirisamy, the chief operating officer of Nike, said that management was nearly done reorganizing the business for its turnaround plan, and that the goal was to operate with “more speed, simplicity and precision.”
“This is not a new direction,” Mr. Alagirisamy told employees. “It is the next phase of the work already underway.”
Nike, the world’s largest sportswear company, is trying to recover after missteps led to a prolonged sales slump, in which the brand leaned into lifestyle products and away from performance shoes and apparel. Elliott Hill, the chief executive, has worked to realign the company around sports and speed up product development to create more breakthrough innovations.
In March, Nike told investors that it expected sales to fall this year, with growth in North America offset by poor performance in Asia, where the brand is struggling to rejuvenate sales in China. Executives said at the time that more volatility brought on by the war in the Middle East and rising oil prices might continue to affect its business.
The reorganization has involved cuts across many parts of the organization, including at its headquarters in Beaverton, Ore. Nike slashed some corporate staff last year and eliminated nearly 800 jobs at distribution centers in January.
“You never want to have to go through any sort of layoffs, but to re-center the company, we’re doing some of that,” Mr. Hill said in an interview earlier this year.
Mr. Alagirisamy told employees that Nike was reshaping its technology team and centering employees at its headquarters and a tech center in Bengaluru, India. The layoffs will affect workers across North America, Europe and Asia.
The cuts will also affect staffing in Nike’s factories for Air, the company’s proprietary cushioning system. Employees who work on the supply chain for raw materials will also experience changes as staff is integrated into footwear and apparel teams.
Nike’s Converse brand, which has struggled for years to revive sales, will move some of its engineering resources closer to the factories they support, the company said.
Mr. Alagirisamy said the moves were necessary to optimize Nike’s supply chain, deploy technology faster and bolster relationships with suppliers.
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