Oil Company Defendants Seek a Federal Venue for the Climate Change Case Against Them
In the United States Supreme Court
| Argument | January 19, 2021 |
| Decision | May 17, 2021 |
| Petitioner Brief | BP, et al. |
| Respondent Brief | Mayor and City Council of Baltimore |
| Opinion Below | Fourth Circuit Court of Appeals  |
Case Decision
On May 17, 2021, the Supreme Court ruled for BP, et al. The Fourth Circuit should have reviewed all of the companies’ requests for removal to federal court.
Stay tuned for our Decision Analysis.
Argument Analysis:
January 15, 2021
Baltimore sued 26 multinational oil companies, alleging they are partially responsible for the damage caused by climate change. The oil companies would rather not have the case heard in Maryland state court, so they requested to “remove” the case to federal court in Maryland.
This case in the Supreme Court asks whether the Fourth Circuit Court of Appeals erred in reviewing the oil companies’ request for removal.
The Lawsuit
The Mayor and City Council of Baltimore brought the lawsuit, claiming they suffer damage from the effects of climate change and that certain oil companies pushing fossil fuel products are partially responsible. The oil companies sued in the case include BP, Chevron, ExxonMobil, Shell Oil, Citgo, Marathon, Speedway, Hess, Phillips 66 and others.
The case alleges that the companies produced, promoted, and misleadingly marketed fossil fuel products after learning of the products’ dangers and connection to global warming. According to Baltimore, the companies engaged in a “coordinated multi-front” effort to conceal knowledge, to discredit scientific evidence and to undermine public support for regulation while seeking unrestrained expansion of their products.
The merits of the case are not at issue in the Supreme Court, at least not yet. This Supreme Court case involves the oil companies’ request to remove the lawsuit from Maryland state court to federal court.
Removal
Certain cases can be filed in either state court or federal court. The plaintiff makes the choice because the plaintiff files the case, but sometimes it’s the defendant who prefers a federal venue. Often it’s because the defendant fears it will face prejudice or bias in the state court.
The threat of prejudice is real in this case because the defendant oil companies face a suit by local government actors, who are more connected to the state courts than the defendants are.
If a plaintiff files a case in state court, but the case could have been filed in federal court, the defendant may seek to remove the case.
The defendant must satisfy one of several grounds for removal, based on federal court jurisdictional requirements. If the case involves an issue of federal law, for example, federal courts have jurisdiction. Additionally, a number of federal laws specifically grant federal jurisdiction for certain types of cases.
In this case, the defendants asserted a number of grounds for federal court jurisdiction, including one ground that is covered by a specific statute (the federal officer removal statute, 28 U.S.C. § 1442) and another asserting that the plaintiffs’ claims arise under federal law. Unfortunately for the defendants, the federal district court in Maryland didn’t go for it and instead sent the case back to state court.
Appeal of the Remand
After the federal court remanded the case back to state court, the defendants appealed. They asked the Fourth Circuit Court of Appeals to review whether the Maryland district court had properly reviewed the grounds for federal court jurisdiction.
In determining its own jurisdiction to hear the appeal, the Fourth Circuit relied on 28 U.S.C. § 1447(d), which says:
An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1442 or 1443 of this title shall be reviewable by appeal or otherwise.
The Fourth Circuit interpreted that 1447(d) only allows it to review the grounds for appeal specifically listed in it: those removed pursuant to section 1442 or 1443.
The oil companies’ removal claims included section 1442 and other grounds not listed in the statute. Thus, the Fourth Circuit reviewed only whether the district court correctly decided the oil companies’ section 1442 claim. In reviewing the section 1442 claim, the Fourth Circuit agreed with the district court that the oil companies did not have jurisdiction.
The Supreme Court Appeal
The oil companies appeal now to the Supreme Court, claiming the Fourth Circuit improperly limited its review to their section 1442 claim.
They argue 28 U.S.C. § 1447(d) should be interpreted differently. According to the oil companies, the text doesn’t say the appeals court can only review the section 1442 claim. The statute specifically says the appeals court can review the order containing the section 1442 claim. And, the oil companies point out, the order includes the entire set of removal grounds:
Such a command necessarily rejects all of the defendant’s grounds for removal, because the case must remain in federal court if there is any basis for federal jurisdiction. An appeal of a remand order thus brings all of those grounds for removal before the court of appeals, and the court of appeals cannot affirm unless each lacks merit. Review of a remand “order” therefore necessarily entails review of all of the defendant’s grounds for removal.
In defense of the Fourth Circuit’s reasoning, Baltimore points out that section 1447(d) was meant to avoid “prolonged litigation of non-dispositive jurisdictional issues.” According to Baltimore, limiting courts to reviewing only those two types of removal grounds listed in section 1447(d), is the common sense view, because otherwise the additional removal grounds attached to the same order are included arbitrarily. In effect, the oil companies interpretation will encourage gamesmanship, where parties include a meritless section 1442 claim, just to ensure their entire set of removal grounds is considered on appeal.
The Supreme Court will hear arguments on January 19, 2021.
Decision Analysis
May 17, 2021
On May 17, 2021, the Supreme Court ruled in favor of BP and a number of oil companies facing an environmental challenge from the Mayor and City Council of Baltimore (together, the “City”). The question before the Supreme Court did not involve the merits of the case. It asked only whether the appellate court properly reviewed the companies’ requests to remove the case from state to federal court.
Case Background
The City brought the case against 26 multinational oil companies, arguing the companies are partially responsible for the effects of climate change which are causing the plaintiffs harm. The case alleges that the companies produced, promoted, and misleadingly marketed fossil fuel products after learning of the products’ dangers and connection to global warming.
Issue Before the Supreme Court
The oil companies sought to remove the case to federal court so they could avoid Maryland state court which might be sympathetic to the local government plaintiffs’ case. When the defendants requested removal to federal court, they argued for removal under 4 different grounds. One of those grounds was a request under 28 U.S.C. § 1442, the federal officer removal statute.
When the Fourth Circuit Court of Appeals reviewed the case to determine if it had jurisdiction for review, it considered the text of 28 U.S.C. § 1447(d), which says:
An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1442 or 1443 of this title shall be reviewable by appeal or otherwise.
The Fourth Circuit took that to mean that it could review only the portion of the order specifically relating to sections 1442 and 1443. Then, in reviewing the § 1442 ground, the Fourth Circuit denied removal.
The oil companies, however, interpreted the text of § 1447 to allow review on all of the grounds listed in the order denying review. All four, not just the ground denying review based on section 1442. The oil companies appealed to the Supreme Court arguing the Fourth Circuit should have reviewed the three other grounds under which they requested removal.
The Supreme Court took the case to decide which interpretation of § 1447 was correct.
The Supreme Court Decision
The Court decided the case 7-1 in favor of the oil companies’ interpretation. Justice Sotomayor dissented, and Justice Alito took no part in the case.
The opinion of the Court, written by Justice Gorsuch, reasoned that a removal order encompasses all of the grounds for removal. When a defendant requests removal, it actually does the arguing about whether removal is appropriate to the federal court. So in the majority’s view, a case is technically removed under all of the grounds requested by the defendant, whether or not they withstand a motion for remand. Thus, in this case, the case was removed under § 1442.
Reviewing the text of § 1447 again, then:
An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1442 or 1443 of this title shall be reviewable by appeal or otherwise.
The majority’s view is that the case was “removed pursuant to section 1442 or 1443,” just as the text requires.
The majority supports its view with a 1996 case, Yamaha Motor Corp. v. Calhoun. In Yamaha, the Court addressed whether a court could consider for appellate review all of the grounds on an order where the law read that the order can be reviewed if it “involves a controlling question of law.” The Yamaha Court decided that the text did not limit review only to the specific issue that involves a controlling question of law. The appeals court could review the entire order.
The Dissent
Justice Sotomayor dissented alone. She recounted that historically, questions of removal were not reviewed by appeals courts. The policy was justified by efficiency — cases should be resolved quickly instead of being held up in appeals on procedural issues.
Down the line, Sotomayor said, in certain cases Congress decided to allow appellate review of removal decisions. But Congress specifically limited those cases. It wouldn’t make sense to allow defendants to “bootstrap” for appellate review nearly any removal ground just by adding a weak removal request for section 1442 or 1443. But that’s precisely what the majority opinion does in this case, she said.
Correction: An earlier version of the graphic illustrated the City of Baltimore too broadly on the Maryland map.
