IBAMA v. Dirceu Kruger (Illegal deforestation in the Amazon and climate damage)

On September 12, 2023, the Federal Environment Agency - IBAMA filed a Public Civil Action (ACP) against Dirceu Kruger for climate damage. The defendant is a cattle raiser and has been fined several times by the environmental agency for illegal deforestation of a total of 5,600 hectares in the state of Amazonas, using fire. It is argued that his illegal activities have an impact on the biomass of the Amazon, illegally interfering with the forest's carbon stock and emitting greenhouse gases (GHG), intensifying the climate crisis. It is argued that climate damage is projected continuously and addresses residual environmental damage in climate matters, which corresponds to the set of effects and imbalances that cannot be remedied. The climate damage also implies intergenerational environmental damage, since it spreads indefinitely, causing future damage. The plaintiff argues that the defendant's conduct was held under violation of the Paris Agreement and that the international obligations internalized by Brazil are binding for the Judicial Branch, implying the determination of reparability of environmental climate damage. It presents a means of quantifying climate damage based on studies by the CADAF Project (Carbon Dynamics of Amazonian Forest), representing 160.34 tons of carbon emitted per deforested hectare; on a study developed by the Center for Management and Strategic Studies: "REDD in Brazil: an Amazonian approach", setting 161 tons of carbon per hectare; and on the social cost of carbon (SCC), arguing that there is a direct proportion between the number of hectares deforested and the generation of carbon, in line with the parameters set by the Amazon Fund. Therefore, the plaintiff argues that climate damage can be identified on an individual scale by multiplying the estimated GHG emissions from the activity (5,600 hectares multiplied by 161 tons emitted per hectare) by the SCC (based on the cost calculated by the OECD of 60 euros per ton). Thus, the deforestation generated the illegal emission of 901,600 tons of carbon, resulting in the obligation to pay the amount of R$292,118,400.00. As a preliminary injunction, it is requested that (i) the litigious nature of the property which is the subject of the action be recognized; (ii) the defendant be ordered not to transfer the occupation of the area to third parties; (iii) the defendant be prohibited from leasing or lending chainsaws and other deforestation tools; (iv) the defendant be prohibited from selling or donating oxen or agricultural products; (v) the blocking or unavailability of assets in the equivalent amount of R$292,118,400.00; (vi) the suspension or restriction of the defendant's access to tax benefits and credit lines; (vii) the defendant be ordered to implement carbon sinks. On the merits, the plaintiff claims that the defendant be condemned to (i) repair the environmental climate damage in ecological compensation; (ii) repair the interim climate damage; (iii) promote ecological compensation; (iv) promote financial compensation for illegal greenhouse gas emissions, with the amount of R$292,118,400.00 being reverted to the National Climate Change Fund; (v) promoting financial compensation to be set by the court for the amounts to be reverted to funds for preventing and responding to climate disasters; (vi) compensating the amount related to the disgorgement of profits; and (vii) confirming the requests made as a matter of urgency. On July 12, 2024, a decision on the injunction was handed down in which the court granted, in part, the emergency relief requested to (i) order the defendant's assets to be made unavailable, up to a limit of R$292,118,400.00; (ii) order the defendant to promote the implementation of carbon sinks, considering for this purpose the emission of 901. 600 tonnes of carbon and, for abatement purposes, any recovery/restoration found in the deforested areas, which must be proven when the project is presented within 90 days, under penalty of a daily fine; (iii) suspend and prohibit the defendant's access to lines of financing with official credit institutions; (iv) suspend and prohibit the granting of tax benefits to the defendant; (v) inform national financial institutions of the processing of this lawsuit; (vi) prohibit the defendant from acquiring, selling, leasing or lending chainsaws, tractors and associated instruments, as well as prohibit the defendant from acquiring, selling, leasing or lending cattle or agricultural products, under penalty of a fine for each business act carried out; and (vii) prohibit the defendant from carrying out any business act involving the properties affected by the deforestation discussed in the case, under penalty of a fine for each business act carried out. The secrecy assigned to the decision was lifted. In addition, the initial petition was partially dismissed, and only the claims for the implementation of sinks and the adoption of environmental compensation measures relating to climate damage, for financial compensation for the social cost of carbon, and restitution of illicitly earned profits were processed.