Tokenizing Claims for Environmental Damages — Another Use-Case for DAO IPCI Security Deposit Contract

DAO Integral Platform for Climate Initiatives Security Deposit Contract may be used to support environmental claims for damages.

Along with filing the case in the court, primary Claimant may create Security Deposit Contract in DAO IPCI and deposit Mitigation Tokens (MITO) at the Contract, which allows for issuance 1:X amount of Claim Tokens depending on the ratio established by the Operator of DAO and the Independent Entity. For example, 10 Claim Token per MITO. Secondary Claimants may increase the deposit, thus, increasing the amount of Claim Token Issued. The tokens would be verified once the court renders positive award. The case may be settled either in monetary form or by ’in-kind’ offsetting. Thus, smart contract allows for initiating claim for damages, supporting it by secondary claimants, either reimbursement or offsetting the damage.

Most recently ten families from five EU countries, Kenya and Fiji, as well as a Swedish youth organization, filed case against the European Parliament and the Council of the European Union in General Court in Luxemburg. They say the EU is violating their fundamental rights of life, health, livelihood and property by failing to combat global warming.[1]

The Climate Change Litigation of the World database includes over 276 court cases across 25 national courts (excluding the United States) and international adjudicatory bodies. Over 800 cases already identified in the US.[2] Those include claims in opposition of climate action, for deregulation, granting licenses to fossil fuel-based projects etc. Smart contracts are impartial and, theoretically, those can be tokenized too. The majority of cases deal with mitigation (77 per cent of cases are primarily concerned with emissions reductions), but there is some jurisdictional variation — for example, Australia has notable cases on adaptation, mostly dealing with coastal planning and risks from climatic hazards. [3]

Corporations are the single most represented group of plaintiff; they bring 40 per cent of cases to court, 90 per cent of which are against governments, to overturn administrative decisions made on the basis of climate change to deny a license (e.g. for a coal-fired power plant or water extraction); and to challenge allocation of allowances under emissions trading schemes or governmental schemes (e.g. for production of renewable energy).

In 70 per cent of the cases, climate change is actually at the periphery of the argument. Nevertheless, even in lawsuits where climate change is not central, the judiciary is increasingly exposed to climate change arguments in cases where, until recently, the environmental argument would not have been framed in those terms. For instance, challenges to fossil fuel-related projects have been brought for many years, but it is only in the last decade that climate change has been used as part of the argument or as a motivation for those cases.

In 2015, 900 Dutch citizens, represented by the Urgenda Foundation, took their government to court to cut greenhouse gas emissions. It was the first time a group of citizens sued their own government over climate change action — and they won.

The lawsuit resulted in a Dutch court ordering the government to cut greenhouse gas emissions nationwide by at least 25 percent by the year of 2020 (compared to 1990 levels), forcing it to take further measures against climate change.[4]

In 2015, University of Waikato law student Sarah Thomson sued the government of New Zealand for failing to set emissions targets that reflect the scientific consensus on climate change, and lost.[5]

There are notorious examples of public protest in Russia against air pollution from landfills. Little can be done as all the permissions from the government are in place. Filing a case and enlisting a claim against relevant authorities in blockchain is a way to seek settlement. Primary individual claim secured by payment token deposit might be supported by secondary claims increasing the value of the claim. Furthermore, objective IoT devices may quantify and verify negative impact.

The Respondent may choose to ignore the claim, reimburse damage by buying out “the claim tokens” or to compensate the damage with the verified results of mitigation measures if there are any.

These use-cases are hypothetical for the moment but environmental litigations, and most importantly settlements on blockchain would be consistent with public blockchain ideology and concepts.

[1] http://www.dw.com/en/families-hit-by-climate-change-sue-the-eu/a-43933608

[2] http://climatecasechart.com/us-climate-change-litigation/

[3] http://www.lse.ac.uk/GranthamInstitute/wp-content/uploads/2018/04/Global-trends-in-climate-change-legislation-and-litigation-2018-snapshot-2.pdf

[4] http://www.lse.ac.uk/GranthamInstitute/wp-content/uploads/2018/04/Global-trends-in-climate-change-legislation-and-litigation-2018-snapshot-2.pdf

[5] https://www.radionz.co.nz/news/national/342953/law-student-loses-case-against-govt-s-climate-policy