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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

October 5th, 2026: Supreme Court hears oral argument in Suncor Energy v. Boulder County

Overview

Updated Oct 21

Two federal judges have ruled that New York's Climate Change Superfund Act is preempted by federal law. Judge Brenda Sannes blocked the $75 billion program on August 31, and Judge P. Kevin Castel issued a permanent injunction on September 23. The Northern District entered final judgment the next day.

The Supreme Court heard oral argument on October 5 in Suncor Energy v. Boulder County, which could decide whether state climate liability claims survive nationwide. New York is expected to appeal both rulings to the Second Circuit.

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.
22
States that sued to block the law
A coalition of 22 states joined the February 2025 federal lawsuit challenging the Act.

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People Involved

P. Kevin Castel
P. Kevin Castel
US District Judge, Southern District of New York
Issued permanent injunction against the Climate Change Superfund Act on September 23, 2026
 Brenda K. Sannes
Brenda K. Sannes
Chief US District Judge, Northern District of New York
Ruled on August 31, 2026 that the Act is preempted by federal law

Organizations Involved

U.S. Department of Justice
U.S. Department of Justice
Federal agency
Filed statement of interest and lawsuits against New York and Vermont climate superfund laws

The federal government argued the state laws are preempted by the Clean Air Act and the foreign affairs power.
New York State
New York State
State government
Law blocked by federal courts; appeal expected

Enacted the Climate Change Superfund Act in December 2024 to collect $75 billion from fossil fuel companies for climate adaptation.

Timeline

April 2021 October 2026

8 events Latest: October 5th, 2026 · 1 month ago
Tap a bar to jump to that date

  1. Supreme Court hears oral argument in Suncor Energy v. Boulder County

    Latest Legal

    Oral argument was held. A ruling is expected before the Court's term ends in June 2027.

  2. Northern District enters Rule 54(b) judgment

    Legal

    The court entered judgment for the state and industry plaintiffs, enjoined enforcement, and allowed an immediate appeal of the preemption claims.

  3. Second judge issues permanent injunction

    Legal

    Judge Castel in the Southern District ruled the law unconstitutional and permanently blocked its enforcement.

  4. Parties seek final judgment and injunction

    Legal

    Both sides jointly asked the court to enter judgment and enjoin enforcement, setting up an appeal.

  5. Judge Sannes rules the Act preempted

    Legal

    The Northern District granted summary judgment, holding the law preempted by the Clean Air Act and foreign affairs doctrine.

  6. Coalition of states files suit

    Legal

    More than 20 states challenged the law's constitutionality in federal court.

  7. 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.

  8. Second Circuit rejects New York City's climate claims

    Legal

    The appeals court dismissed the city's suit against Chevron and Exxon Mobil, ruling federal law governs interstate emissions claims.

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.

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.

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.

Sources

(18)
+12
The New York Times Law360 Mondaq US Department of Justice The Washington Times Jones Day National Law Review Times Union amNewYork Discovery Alert Alston & Bird Sidley Environmental, Health, and Safety Brief Foley Hoag LLP Gravel2Gavel Sabin Center for Climate Change Law CourtListener Grist U.S. Department of Justice