Energy Transfer Sues Greenpeace: Will It Face Bankruptcy?

by Edwin BensonOctober 4, 2024

“Everybody is afraid of these environmental groups and the fear that it may look wrong if you fight back with these people, but what they did to us is wrong, and they’re gonna pay for it.”

The speaker is Kelcy Warren. He runs Energy Transfer, which moves so-called fossil fuels from one part of the world to another. Chances are excellent that the gasoline in your car’s tank passed through one of Energy Transfer’s pipelines.

Risky Business

The energy business has always been risky. Oil and natural gas prices swing violently and are subject to natural disasters and government regulation. Those regulations usually result from environmental lobbying and protests rather than careful consideration or wise deliberation. Even a project that obtains federal approval can be blocked by state bureaucracies.

Additionally, pipelines are uniquely exposed. Unlike oil fields and refineries, which are in concentrated areas, the often unguarded pipelines lie exposed and extend for hundreds of miles.

One of Energy Transfer’s projects is the Dakota Access Pipeline, which has been controversial from the start.

A Political Football

Wrangling over permits went on for years, as did the protests. The Obama Administration blocked it, but the Trump Administration granted final approval. Completed in 2017, its 1,172-mile path crosses four states: North and South Dakota, Iowa, and Illinois. It stretches from the shale fields of northwest North Dakota to Patoka in southern Illinois. It can transport 750,000 barrels of “light sweet crude” every day.

Other than the government’s watchdogs, Dakota Access’s two most prominent opponents were the international ecological organization Greenpeace and the Standing Rock Sioux Indians.

The pipeline’s construction inspired two lawsuits involving protesters. Both may soon reach their conclusions. Both have spent years in the “legal pipeline,” separating questionable actions from a court’s assessment of responsibility.

The State Verses the Feds

The first is between the State of North Dakota and the U.S. Army Corps of Engineers. The state hopes to recover over $38 million. On September 12, 2024, Senator Kevin Cramer (R-North Dakota) released a statement when the state filed its final brief in the long-running dispute.

“The Army Corps of Engineers and Department of Justice leadership knew protestors were unlawfully occupying the land and engaging in illicit activities. Instead of assisting North Dakota law enforcement the Corps willfully violated its own legal obligations which emboldened protestors and caused extensive damages. North Dakota taxpayers cannot be expected to bear the cost of the federal government’s deliberate inaction.”

Those protestors figure in the second lawsuit as well. In this one, the stakes are considerably higher. Energy Transfer is seeking $300 million in damages from the environmentalists at Greenpeace. A state court in North Dakota will hear the case in February 2025.

The Usual Plaintiff Becomes the Defendant

According to a recent article in the Wall Street Journal, Energy Transfer alleges that “several Greenpeace entities incited the Dakota Access protests, funded attacks to damage the pipeline, and spread misinformation about the company and its project.” Perhaps more importantly, a North Dakota state court will hear the case. This jury won’t consist of Washington, D.C. liberals. These jurors will be salt-of-the-earth types who know the value of private property.

When Greenpeace appears in courtrooms around the United States, it often wins. This case is different. Usually, Greenpeace is the plaintiff. This time, its role as defendant is far less comfortable. The WSJ article quotes Greenpeace USA’s acting co-executive director, Deepa Padmanabha, who labeled the lawsuit “an existential threat.”

Mr. Warren’s lawsuit has a real chance of causing Greenpeace USA to go bankrupt, and the national chapter is running scared.

Last March, the organization’s language was considerably more strident. In an article prepared for its supporters, the environmentalists argued that the lawsuit was “outrageous” and “dangerous.” It buttressed that language with six “things you should know.” The logic behind them says a lot about the state of thought among modern radicals.

Six Weak Arguments…

Their first argument is peculiar. It alleges that the lawsuit is racist. How did they arrive at that conclusion? The path is convoluted. They think that the Energy Transfer should have sued the Standing Rock Sioux. Greenpeace argues that the Indians actually organized the protest actions. The organization played only a secondary role. Greenpeace contends that the company’s attempt to blame them is a case of “[r]ewriting history to erase Indigenous communities and leadership.” So, suing the Indians would be less racist than suing leftists.

Their second contention quibbles with the fact that Energy Transfer is using the Racketeer Influenced and Corrupt Organizations Act (RICO) to sue Greenpeace. It accurately states that those laws were written to prosecute organized crime. However, as the official term indicates, those statutes exist to fight against “organizations” committing “crimes,” precisely what Energy Transfer accuses Greenpeace of doing.

The third point is that the lawsuits attack Greenpeace’s “legitimate First Amendment-protected speech” rights. Perhaps the crack legal team at its offices in Washington, D.C., haven’t informed its bosses that the $300 million being sought by Energy Transfer is for damages. 

Each More Feeble than the Last

The fourth assertion is that “the lawsuits directly attack statements of solidarity with the Standing Rock Sioux.” The explanation doesn’t make much sense, either. “[T}he lawsuit seeks to shatter the networks and mutual support that make our social movement powerful.” No one doubts that Energy Transfer wants to weaken Greenpeace, which is the purpose of most lawsuits against those who damage the property and reputation of others.

Greenpeace’s fifth defense is that the lawsuit tries to “impose collective liability. “Again, they are correct, but it is a point not worth making. Collective liability is precisely what organizations that advocate for or cooperate in breaking the law incur. Greenpeace’s quibble is the rough equivalent of a child saying, “We both ate the cookies, but Jimmy is the one who actually climbed up on the counter and broke open the jar.”

The last point makes an even more juvenile argument. It says that Greenpeace can’t be guilty because Energy Transfer was convicted in another court for other acts-unrelated to the Dakota Access Pipeline. The point may be accurate, but it is irrelevant. It is like saying that the boy next door must have burned down his neighbor’s garage because he stole a candy bar from the corner store two years ago.

Mr. Padmanabha could well be correct when he says this suit could put Greenpeace USA out of business. If the six arguments it used to convince its supporters indicate the strength of its legal case, it would seem that the group doesn’t have a chance against an actual jury.