Another climate change lawsuit remanded to state court

The Tenth Circuit has recently joined its sister circuits, the Fourth Circuit and Ninth Circuit, in finding that federal courts do not have subject-matter jurisdiction over state-law nuisance claims. A Colorado climate-change lawsuit against ExxonMobil and Suncor Energy must therefore be litigated in state court, rather than federal court.

The lawsuit was filed by cities and counties that alleged the defendant companies contributed to global warming by producing, promoting, refining, marketing, and selling fossil fuels. They also alleged that the defendants misrepresented the dangers of fossil fuel use. According to the plaintiffs, the threat of global warming imposed costs on them associated with mitigating the effects of heat waves, wildfires, droughts, and floods. They asserted claims for state-law nuisance and other torts, as well as a state-law consumer protection claim, seeking monetary damages from the defendants.

The defendants removed the case from Colorado state court to federal court, asserting several grounds for removal. On the plaintiffs’ motion, however, the district court remanded, rejecting all the arguments for removal. The defendants appealed. The Tenth Circuit determined that it only had authority to review one ground for removal: the federal officer removal statute. Slip op. at 46. That statute governs removal of cases against an officer of the United States or a person “acting under” that officer “for or relating to any act under color of such office.” 28 U.S.C. § 1442(a)(1). To remove a case under the federal officer removal statute, a private company must show (1) it acted under the direction of a federal officer; (2) a causal nexus between the plaintiff’s claims and the company’s acts; and (3) a colorable federal defense to the plaintiff’s claims. Slip op. at 48. The statute was passed to “protect federal officers from interference by hostile state courts.” Id. at 47 (quoting Willingham v. Morgan, 395 US 402, 405 (1969)).

ExxonMobil claimed that its mining operations at the Outer Continental Shelf under government leases constituted “acting under” a federal officer, but the court disagreed. Id. at 48, 62. Although its lease required ExxonMobil to comply with federal conditions and regulations in its oil and gas drilling operations, merely complying with complex statutory or regulatory requirements was not enough to meet the “acting under” test. Instead, the company had to help carry out the federal superior’s duties under the superior’s strict guidance and control. Id. at 53. The oil and gas leases did not involve the close supervision required to meet the “acting under” requirement. For example, although the government had reserved certain rights to direct drilling activity and production rates, it had never actually given such direction. Id. at 54-62.

The Tenth Circuit therefore affirmed the district court’s remand order and sent the case back to state court.

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