Kenneth Berlin and his team at Skadden Arps Slate Meagher & Flom have been working on climate-related matters for years. He headed the Justice Department’s Environmental and Natural Resources Division, chaired the Environmental Law Institute and has shepherded a mountain of environmental litigation for major corporations.
Skadden had not needed a climate change group before: it simply tapped environmental, energy regulatory, intellectual property and tax lawyers to help out when the need arose. Partners at the
“The whole area is changing,” says
The firm is joining an ever-growing list of major
“Climate is hot in a way that nothing else has been before,” says Latham & Watkins partner Robert Wyman Jr, the firm’s lead counsel for Clean Air Act matters. “We are talking about transforming the energy and transportation economy.”
Unlike other fleeting law firm trends — remember those Y2K practices? — there appears to be real work to be done here. Although the US Congress is still working out federal emissions limits, corporate clients are facing state and regional emissions caps as well as standards outside the
That said, there is still a marketing ploy at work: ‘climate change’ groups primarily rely upon lawyers from existing practice areas, such as corporate, energy, tax and, of course, environmental. Labelling a multidisciplinary group as a ‘climate change practice’ is shorthand for clients that are genuinely fearful about regulation and litigation.
Cash incentive
Naturally, there is money to be made. Covington & Burling’s Ruben Kraiem, who co-chairs the firm’s carbon markets, climate change and clean technology practice, says the 17-lawyer group has generated $1.5m (£759,000) annually since its inception in 2005.
Kraiem estimates that at least 250 of the hours spent on Kohlberg Kravis Roberts & Co and Texas Pacific Group’s $45bn (£22.8bn) leveraged buy-out of TXU Corp in 2007 were billed as climate change work. During the buy-out, investors became concerned about opposition from environmental groups because of the company’s coal-powered generation of electricity. The buyers wanted the deal to include a number of policies addressing climate change issues.
Latham’s Wyman says his firm’s global climate change practice, which started in 2004, is generating serious revenue. He says one of his current climate projects alone has brought in more than $1m (£506,000) in fees.
Wyman, a partner in the firm’s
Wyman formed the coalition in anticipation of the 2006 enactment of the California Global Warming Solutions Act, which mandates that greenhouse gas emissions from major industries are reduced to 1990 levels by 2020.
American Honda belongs to the carbon-emitting side of Wyman’s coalition. David Raney, senior manager of environmental and energy affairs for Honda, says he sought out Latham, and specifically Wyman, for the firm’s expertise on carbon trading. “We are breaking new ground,” says Raney.
Carbon lawyers
One of the key business drivers for firms is the Kyoto Protocol. Though the
The protocol requires developed countries to reduce greenhouse gas emissions to below-1990 levels and allows companies to invest in clean energy projects in other countries in exchange for credits to offset emissions. The European Union has set up a cap-and-trade system under which companies are assigned emissions limits. They can then trade for carbon credits if they exceed their caps.
And that is where the ‘carbon lawyers’ come in. Alston & Bird partner Kipp Coddington, for instance, helps his greenhouse gas-emitting clients navigate the carbon market by advising them on emissions trading issues. He says 90% of the practice’s clients are new to Alston and were specifically looking for climate change expertise.
Firms are also anticipating eventual federal regulation in the
The Senate Committee on Banking, Housing and Urban Affairs has held hearings on getting the SEC to require public companies to disclose the financial impact of climate regulation.
Big-ticket litigation
Firms are also seeing a bump in litigation based on climate change issues. Honda, for instance, is one of several car manufacturers involved in a high-stakes fight over greenhouse gas regulation.
Of counsel Charles Haake and partner Raymond Ludwiszewski, both based in Gibson Dunn & Crutcher’s
Though Gibson Dunn does not have an explicitly-labelled climate change practice, Ludwiszewski was general counsel at the Environmental Protection Agency (EPA) in the early 1990s and has dealt with climate issues for years.
Under the Clean Air Act,
The problem, says Ludwiszewski, is that a vehicle’s gas mileage is measured by converting carbon dioxide emissions to miles per gallon. By capping carbon dioxide from cars,
Though
Like Gibson Dunn, litigation giant Kirkland & Ellis does not have a climate change practice but lawyers there are busy getting up to speed. Washington DC-based partners Andrew Clubok and Stuart Drake are representing the Alliance of Automobile Manufacturers, which includes Ford, Chrysler and General Motors, in the multistate litigation.
It is clear the legal battle over climate change will not be going away. In Congress, the proposed
See Opinion, page 21. A version of this article first appeared in Legal Times, Legal Week’s