ABLE e IDERS vs. União Federal (Economic reconstruction after the floods in Rio Grande do Sul.)

In 28 May, 2024, the Brazilian Association for Economic Freedom (ABLE) and the Institute of Law and Economics of Rio Grande do Sul (IDERS) filed a Public Civil Action (ACP) against the Federal Government following the floods that hit Rio Grande do Sul in April and May 2024. They argued that the climate disaster caused a humanitarian, social, and economic crisis that severely affected the productive sector of Rio Grande do Sul, and that the Federal Government has a constitutional and legal duty to act in prevention, response, and recovery in the face of public calamities. They alleged that the measures adopted by the federal government were insufficient, as they focused primarily on offering subsidized credit, financial guarantees, and postponement of obligations, rather than non-refundable resources capable of promoting the economic reconstruction of the state. No concrete measures were taken by the federal government despite a project comprised of reports which projected extreme increases in rainfall in the South of the country (titled "Brazil 2040: Scenarios and Alternatives for Adaptation to Climate Change,"). They ask for the implementation of a comprehensive financial support plan for the affected productive sector, with direct transfer of non-refundable resources, as well as the condemnation of the federal government to pay collective moral damages arising from its alleged responsibility for insufficient preparation and management of the calamity.

In an amendment to the initial petition, the legal basis for the claim was reinforced, especially regarding the Union's responsibility in the prevention, response, and recovery from disasters, based on Law No. 12.340/2010.

In June, 2024, the 1st Federal Court of Porto Alegre dismissed the lawsuit without prejudice, recognizing the lack of standing of ABLE and IDERS. The court understood that there was not sufficient thematic relevance between the institutional objectives of the associations and the protection sought on behalf of the companies affected by the floods.

In their appeal, the plaintiffs argued that the lawsuit did not seek private compensation, but rather the implementation of a public economic policy aimed at rebuilding the productive sector of Rio Grande do Sul. They argued that the statutory purposes of ABLE and IDERS, related to the economic analysis of law, public policies, and economic freedoms, were sufficient to legitimize their actions.

The Federal Regional Court of the 4th Region dismissed the appeal filed by AMICROPOA – which requested to join the case as a co-litigant assistant to the plaintiffs – due to a procedural representation defect, and denied the appeal filed by ABLE and IDERS. The court concluded that the institutional objectives of the associations were predominantly focused on teaching, research, academic production, and the promotion of debates on law and economics, and that there was insufficient thematic relevance to require the Union to implement a financial support plan for the productive sector, nor to claim collective moral damages, thus upholding the dismissal of the action.