ALBANY, N.Y. (NEXSTAR) — The U.S. Department of Justice filed a legal challenge to New York’s Climate Change Superfund Act on May 1. DOJ asked the federal court in the Southern District of New York to block the law, which charges oil and gas companies $75 billion for past greenhouse gas emissions.
President Donald Trump issued Executive Order 14260 on April 8 to override state laws that “burden” energy production. That order prompted DOJ to target New York’s—and Vermont’s—retroactive fees for fossil fuel emissions. The White House called these state laws “ideologically motivated” and harmful to national security.
The complaint—available to read at the bottom of this story—argued against the law’s cost recovery demand, which treats companies as “strictly liable” for climate damage. It asks the court to declare the law unconstitutional and pause the Superfund Act so companies don’t have to pay or follow its rules while the case is underway.
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The act— S2129B/A3351B—requires any company that released over a billion tons of greenhouse gases from 2000 through 2024 to pay for their share of total emissions. The strict liability standard means a given company would have to pay without proving any specific environmental damages in court. That’s because the factual data about total emissions and the impact of greenhouse gas emissions on climate are not apparently at issue.
Gov. Kathy Hochul—a named defendant in the case, alongside Attorney General Letitia James and Amanda Lefton, the Acting Commissioner of the Department of Environmental Conservation—signed the Superfund Act into law in December. Still, payments wouldn’t come due until Sept. 30, 2026, when polluters could begin a 24-year payment plan instead of paying their share of the total.
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The Act’s sponsors in the legislature structured the payments so that companies would pay into an account—or “superfund”—totaling $75 billion by October 2050. Legislators behind the bill said that account would then fund local projects like wetlands restoration, storm defenses, and green energy upgrades for public housing.
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But federal officials argued the law contradicts the federal Clean Air Act, which gives the U.S. Environmental Protection Agency sole authority over air pollution across state lines. That’s how the lawsuit alleged that New York overstepped its power: by trying to regulate emissions not just across state lines, but worldwide.
Besides the clash with the Clean Air Act, DOJ said the law would violate the Constitution’s interstate commerce, foreign commerce, and foreign affairs clauses. The complaint also theorized that letting one state set global climate rules would damage the federal government’s reputation and power in other countries.
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“These burdensome and ideologically motivated laws and lawsuits threaten American energy independence and our country’s economic and national security,” wrote Attorney General Pamela Bondi in the press release announcing the lawsuit.
“When states seek to regulate energy beyond their constitutional or statutory authority, they harm the country’s ability to produce energy, and they aid our adversaries,” added Acting Assistant Attorney General Adam Gustafson, putting a finer point on the argument. “The Department’s filings seek to protect Americans from unlawful state overreach that would threaten energy independence critical to the wellbeing and security of all Americans.”
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In response, state officials defended the Superfund Act as making polluters pay for rising sea levels and stronger storms instead of taxpayers. A spokesperson from the governor’s office said Hochul “proudly signed the Climate Superfund Act because she believes corporate polluters should pay for the damage done to our environment—not every day New Yorkers. We will not back down, not from Big Oil, and not from federal overreach.”
Senate Finance Chair Liz Krueger, who sponsored the bill, dismissed the federal lawsuit as political posturing. She argued that White House claims don’t make a law unconstitutional. “Instead of helping New Yorkers pay for billions of dollars in increased costs driven by the climate crisis, this president would rather pander to his billionaire oil and gas donors.”
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Assemblymember Jeff Dinowitz, the Assembly sponsor, said he expected a challenge and remains confident in the state’s case. He called the DOJ arguments “utter nonsense,” “malarkey,” and “claptrap.” He said he looks forward to the Superfund generating about $3 billion a year to clean up the mess that oil companies created.
For her part, James promised to protect New Yorkers’ health, environment, and future. She said in a statement, “New York’s Climate Superfund law ensures that those who contributed to the climate crisis help pay for the damage they caused.”
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Take a look at the lawsuit below:
