By Lawrence Hurley

WASHINGTON (Reuters) – U.S. Supreme Court justices on Tuesday appeared to lean toward energy companies in a dispute over a lawsuit filed by the city of Baltimore seeking monetary damages for the impact of global climate change.

The justices heard arguments on a legal issue that will help determine whether the lawsuit and others like it will be heard in a state court, as the city would prefer, or in a federal court, which corporate defendants generally view as a more favorable venue. The arguments did not address the underlying merits of Baltimore claims.

The Maryland city’s suit targets 21 U.S. and foreign energy companies that extract, produce, distribute or sell fossil fuels including BP PLC, Chevron Corp, Exxon Mobil Corp and Royal Dutch Shell PLC.

Some of the eight justices taking part in the case appeared skeptical about the position taken by Baltimore’s lawyers during the argument held by teleconference.

The court has a 6-3 conservative majority but conservative Justice Samuel Alito did not participate, likely because he owns stock in two oil companies involved in the litigation. If the court is divided 4-4 in its eventual ruling – due by the end of June – an earlier ruling in Baltimore’s favor by the Richmond, Virginia-based 4th U.S. Circuit Court of Appeals would stand.

Conservative Justice Brett Kavanaugh described the case as a “close call” but pointed out among other things that Baltimore’s arguments conflicted with a ruling written by the late liberal Justice Ruth Bader Ginsburg in 1996.

“It’s never good to be on the wrong side of Justice Ginsburg opinions,” Kavanaugh said of his former colleague who died in September.

The outcome is likely to affect around a dozen similar lawsuits by U.S. states, cities and counties seeking to hold such companies liable for the impact of climate change.

Baltimore and the other jurisdictions are seeking damages under state law for the harms they said they have sustained due to climate change, which they attribute in part to the companies’ role in producing fossil fuels that produce carbon dioxide and other greenhouse gases. The claims involve oil production and marketing, not the harmful emissions themselves.

The plaintiffs have said they have had to spend more on infrastructure such as flood-control measures to combat sea-level rise caused by a warming climate.

The legal question concerns a provision of federal law that puts limits on appeals courts reviewing decisions by a federal district court judge to remand a case to state court. The companies have said that in this instance the 4th Circuit had broad scope to review a district court’s decision because of a provision that allows for appeals of such rulings when a case directly concerns federal officials or government entities.

Liberal Justice Stephen Breyer noted that the applicable law was enacted to prevent delays in resolving cases, and that giving the energy companies a broad right to appeal could have the opposite effect.

“That means added time, added delay,” Breyer said.

The energy companies have argued that oil production is an inherently federal issue in which the government plays a key role, meaning the case should be heard in federal court. Greenhouse gas emissions that cross state and international lines are likewise an issue that cannot be addressed under state laws, the companies asserted.

Conservative Justice Amy Coney Barrett did not heed calls from some activists that she not participate because her father formerly worked as a lawyer for a Shell subsidiary.

(Reporting by Lawrence Hurley; Editing by Will Dunham)