Joining a diverse group of amici that include the Texas Oil & Gas Association, Louisiana Association of Business and Industry, the U.S. Chamber of Commerce, and others, TCJL has filed as amicus curiaein Plaquemines Parish v. Riverwood Production Co., Inc., et al (No. 19-30492). Several Louisiana parishes, joined by the State of Louisiana, sued Chevron and dozens of oil and gas producers in Louisiana state courts, claiming that the Companies have violated the Louisiana State and Local Coastal Zone Management Act of 1978 (“SLCRMA”) by failing to obtain permits in accordance with the Act. The parishes claim damages relating back to producers’ conduct performed at the direction and control of the federal government during World War II.
During the War, Congress suspended antitrust laws the industry, allowing the federal government to gather the producers’ predecessors into a consolidated exploration and production engine under the supervision and control of a new agency, the Petroleum Administration for War (“PAW”). The PAW micromanaged oil and gas operations, telling the producers where and how to drill, rationing the use of steel and materials for roads, and setting statewide quotas for the production of oil and gas to produce the high octane fuel necessary for the war effort. The parishes claim that the producers should have followed certain “prudent practices,” many of which conflict directly with federal mandates that the they were directed to follow during the War. The parishes particularly target pre-1980 dredging activities exclusively governed by federal law prior to the SLCRMA, raising substantial federal issues that the producers are seeking the Fifth Circuit to review.
Chevron and the other producers removed the cases to federal court under 28 U.S.C. § 1442, which permits removal of cases involving a federal officer, or those acting under the direction of a federal officer, and 28 U.S.C. § 1331, which grants federal jurisdiction to cases involving a federal question. Plaintiffs moved to remand. Two district courts took up the remand motions first, one granting remand because it found removal was untimely, and the other denying remand, finding that the allegations in the petition were insufficient to trigger the removal clock. The cases were consolidated on appeal and, in a cursory opinion, the panel held that the producers’ removal based on the expert report was untimely. The panel concluded that a list of serial numbers of wells, attached as an exhibit to the petitions, gave the producers notice that World War II activity was at issue sufficient to trigger the deadline to remove. The panel’s opinion does not address the timeliness of the federal question ground for removal, which, as the arishes themselves conceded, raised timeliness issues distinct from the federal officer removal.
TCJL’s brief urges the Fifth Circuit to review the panel’s decision en banc and consider the federal question ground for removal raised by Chevron and the producers. As stated in the brief:
“Remanding this case to state court without careful en banc review raises the ominous prospect of the energy industry—arguably the primary engine of economic growth in these sister states—facing civil liability for damages, fines, abatement or mitigation costs, and administrative penalties up to a maximum of $12,000 per violation. See La. Stat. Ann. § 49:214.36(E), (F), (I). Even if this litigation were confined solely to the approximately 40-year period between the commencement of World War II and the passage of the State and Local Resources Management Act in 1978, the full extent of the potential liability could easily reach the hundreds of billions of dollars, even dwarfing the largest civil litigation settlement in American history, the 1998 Tobacco Master Settlement Agreement involving 46 states. [citation] TCJL urges this Court to take another look at this case to make sure that it does not implicate federal law before letting it run its course in state court. The stakes are simply too high not to deal with these issues before the Defendants-Appellants, the rest of the industry, and the American economy are confronted with the potentially catastrophic impact of this litigation.
“No business can operate in a legal and regulatory environment that could have this result. If one state can use its courts to reach into the past in order to extend its regulation of an essential industry in this fashion, what is to prevent similarly inclined states to do the same? Who will ever trust enough in the stability and predictability of the legal and regulatory environment to invest in this industry? What could this litigation end up costing the people who depend on this industry for their livelihoods? What will it cost the businesses and families who need this industry’s products and services to prosper in their own endeavors? While this Court cannot and, indeed, should not address these questions, it can and should address whether the Defendants-Appellants had a fair opportunity to remove this litigation to federal court and resolve the federal questions in the appropriate forum.”
This case is yet another in a national assault on the oil and gas industry from state and local jurisdictions attempting to use the courts to achieve policy changes they cannot achieve through the ballot box and the legislative process. TCJL will continue to let its voice be heard on behalf of our members whenever and wherever these cases occur.