Judge Rules Against New York Over State’s Climate Superfund Law
A federal judge dealt a blow to New York’s climate superfund law, ruling in favor of red states and business groups by saying the policy goes beyond what the state can do.
Chief Judge Brenda Sannes of the US District Court for the Northern District of New York ruled Monday that a federal appellate court’s decision in City of New York v. Chevron Corp. is relevant in the case, contrary to New York’s earlier arguments. Sannes also said in her ruling that the Clean Air Act doesn’t authorize New York’s law, thereby preempting it, and also said the Foreign Affairs Doctrine would preempt “any cost recovery demand against a foreign producer.”
The decision marks a big moment in testing state superfund laws in the courts. New York and Vermont both enacted what have become known as climate superfund laws around the same time in 2024 and were quickly sued over their policies. Other liberal-leaning states have since tried to follow their lead but have yet to advance similar legislation over the finish line, in part hurt by the lawsuits that could determine the laws’ viability.
New York and Vermont enacted their laws as cities and states have been increasingly struggling with steep costs related to natural disasters made worse by climate change that often leave billions of dollars worth of damage in their wakes.
In a July hearing, Sannes indicated the US Court of Appeals for the Second Circuit’s decision in City of New York, in which a panel threw out a nuisance lawsuit against polluters, was relevant to the case. Red states, the US Chamber of Commerce and other business groups sued New York in early 2025 alleging federal law preempts the policy New York passed the year prior to make large polluters pay the state a collective $75 billion for past emissions.
Sannes said City of New York makes clear that the Climate Act operates in an area where federal law has governed consistently and for more than a hundred years, adding later that “it is precisely because the Climate Act operates within an area of law ‘in which the federal interest is so dominant’ that it cannot be enforced.”
The separate cases — one led by states and another by the US Chamber of Commerce and the American Petroleum Institute were ultimately consolidated.
West Virginia Attorney General JB McCuskey said in a statement that the decision is “a major victory in the fight against liberal states, trying to balance their budgets on the backs of our hard-working men and women in the coal, oil and gas industries.”
The Chamber of Commerce also praised the ruling. “The court today sent a clear message: New York cannot extract billions of dollars from energy companies for their lawful operations over the past 25 years,” US Chamber of Commerce Chief Policy Officer Neil Bradley said in a statement.
The Trump administration in November 2025 weighed in on the lawsuit, asking a judge to rule in favor of the plaintiffs.
New York Attorney General Letitia James’s office didn’t immediately respond to a request for comment.
The case is West Virginia v. James, N.D.N.Y., No. 25-00168, 8/31/26.