The federal district court for the Eastern District of California ruled that California’s cap-and-trade program for greenhouse gas emissions was not preempted under the Foreign Affairs Doctrine. First, the court found that the United States failed to identify “a clear and express foreign policy that directly conflicts” with the cap-and-trade program. Second, although the court found that California’s regulations and an agreement linking its cap-and-trade program with Quebec’s program had a “broad purpose” that extends beyond the area of traditional state responsibility, the court concluded that the U.S. failed to show that the cap-and-trade program impermissibly intrudes on the federal government’s foreign affairs power. The court therefore granted the defendants’ motions for summary judgment on the Foreign Affairs Doctrine claim. Since the U.S.’s other claims under the Treaty and Compact Clauses had already been dismissed, the court entered judgment in favor of the defendants.

Federal government's lawsuit challenging California's greenhouse gas emissions cap-and-trade agreement with the
provincial government of Quebec, Canada.

United States v. California

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Federal Court Rejected U.S.’s Remaining Claim in Challenge to California’s Cap-and-Trade Program

Filed

United States of America

California

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Federal Court Rejected U.S.’s Remaining Claim in Challenge to California’s Cap-and-Trade Program

Policy instrument

Risk

Impacted group

Fossil fuel

Greenhouse gas

Economic sector

Finance