Boulder County Commissioners, et al. v. Suncor Energy, et al.Boulder County Commissioners, et al. v. Suncor Energy, et al.
Amici Curiae.
Appeal from the United States District Court for the District of Colorado (D.C. No. 1:18-CV-01672-WJM-SKC)
Kannon K. Shanmugam, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Washington, D.C. (William T. Marks, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Washington, D.C.; Theodore V. Wells, Jr., Daniel J. Toal, Jaren Janghorbani, Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York; Colin G. Harris, Faegre Baker Daniels LLP, Boulder, Colorado; and Hugh Quan Gottschalk, Evan B. Stephenson, Wheeler Trigg O‘Donnell LLP, Denver, Colorado, with him on the briefs), for Defendants – Appellants.
Richard Herz, EarthRights International, Washington, D.C. (Marco Simons, Sean Powers, Michelle Harrison, EarthRights International, Washington, D.C.; David G. Bookbinder, Niskanen Center, Washington, D.C.; and Kevin S. Hannon, The Hannon Law Firm, Denver, Colorado, with him on the brief), for Plaintiff – Appellee.
Peter D. Keisler, C. Frederick Beckner III, and Ryan C. Morris, Sidley Austin LLP, Washington, D.C., filed an amicus brief on behalf of Chamber of Commerce of the United States of America.
W. Eric Pilsk, Sarah M. Keane, Sara V. Mogharabi, and Samantha R. Caravello, Kaplan Kirsch & Rockwell LLP, Denver, Colorado, filed an amicus brief on behalf of Colorado Communities for Climate Action.
Robert S. Peck, Center for Constitutional Litigation, P.C., Washington, D.C., filed an amicus brief on behalf of the National League of Cities, the United States Conference of Mayors, and the International Municipal Lawyers Association.
Peter Huffman, Natural Resources Defense Council, Washington, D.C., filed an
Scott L. Nelson and Allison M. Zieve, Public Citizen Litigation Group, Washington, D.C., filed an amicus brief on behalf of Public Citizen.
Before LUCERO, HOLMES, and McHUGH, Circuit Judges.
McHUGH, Circuit Judge.
This appeal concerns whether federal court is the proper forum for a suit filed in Colorado state court by local governmental entities for the global warming-related damage allegedly caused by oil and gas companies in Colorado. Suncor Energy and ExxonMobil advanced seven bases for federal subject matter jurisdiction in removing the action to federal court, each of which the district court rejected in its remand order. Suncor Energy and ExxonMobil now appeal, relying on six of those bases for federal jurisdiction. We hold, however, that
I. BACKGROUND
Three local Colorado government entities—the County Commissioners of Boulder and San Miguel Counties and the City of Boulder (Plaintiffs-Appellees; collectively, the “Counties“)—filed suit in Colorado state court on June 11, 2018, against Suncor Energy1 and ExxonMobil Corporation (Defendants-Appellants, collectively, “Defendants“). The complaint asserts that the Counties face substantial and rising costs to protect people and property within their jurisdictions from the threat of global warming, including from increasing and intensified heat waves, wildfires, droughts, and floods across Colorado. The Counties allege that Defendants have substantially contributed to this local environmental harm by engaging in unchecked fossil fuel activity—producing, promoting, refining, marketing, and selling—which has resulted in excess greenhouse gas emissions. For decades after becoming aware of the dangers of global warming, the Counties further allege, Defendants continued to produce, promote, refine, market, and sell fossil fuels at levels that caused and contributed to negative climate alteration without disclosing the harms posed by continued fossil fuel overuse. According to the complaint, Defendants misrepresented the dangers of unchecked fossil fuel use and acted to prevent and forestall changes in energy use that they knew were needed to limit the impact of global warming, thereby exacerbating the climate-related harm suffered by the Counties and their residents.
The complaint asserts state law claims for public and private nuisance, trespass, unjust enrichment, civil conspiracy, and violation of the Colorado Consumer Protection Act. Among other forms of relief, the Counties seek past and future compensatory damages to mitigate the impact of global warming in their respective jurisdictions, along with remediation and/or abatement of the attendant global warming-related environmental hazards they now face. The Counties do not seek “to enjoin any oil and gas operations or sales in the State of Colorado, or elsewhere, or
On June 29, 2018, Defendants filed a notice of removal in federal district court for the District of Colorado, asserting seven grounds for federal jurisdiction. Five of these grounds relied upon the general removal statute,
The Counties filed a motion to remand pursuant to
Defendants appealed the district court‘s remand order with respect to six of their seven asserted bases for removal (omitting a challenge to bankruptcy removal). They also moved in the district court for a stay of the remand order pending appeal. Notwithstanding the general bar to remand order appealability imposed by
The district court denied this motion to stay its remand order on October 7, 2019. Bd. of Cty. Comm‘rs of Boulder County v. Suncor Energy (U.S.A.) Inc. (Boulder County II), 423 F. Supp. 3d 1066 (D. Colo. 2019). Noting the split of authority on the scope of appellate review of remand orders, as well as the lack of a controlling Tenth Circuit opinion, the district court reasoned that this court would likely “follow the weight of authority and find that the only ground subject to appeal is federal officer jurisdiction under § 1442.” Id. at 1070. It disagreed with Defendants’ reading of Yamaha and Coffey, finding instead that ”Coffey suggests the Tenth Circuit would be unlikely to review aspects of a remand order that would otherwise be unreviewable“—here, all bases for federal question jurisdiction other than
Defendants then filed motions in this court and the Supreme Court for a temporary stay of the remand order pending appeal, which both courts denied. The Counties filed a motion for partial dismissal based on the reviewability bar in
II. SCOPE OF APPELLATE JURISDICTION
“‘The authority of appellate courts to review district-court orders remanding removed cases to state court is substantially limited by statute,’ namely,
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 primary clause of this statute is construed together with
The roots of
Here, the district court‘s remand order was premised on lack of subject matter jurisdiction, a
Defendants assert that because their removal was premised partly on federal officer removal under
A. The § 1447(d) Circuit Split
Before proceeding to the substantive statutory analysis, we pause to note disagreement among the courts of appeals over whether invoking a
In 2015, the Seventh Circuit fractured this unanimity on the scope of appellate review created by
The Seventh Circuit‘s reasoning in Lu Junhong relied primarily on the Supreme Court‘s decision in Yamaha Motor Corp., U.S.A. v. Calhoun, 516 U.S. 199 (1996). Yamaha addressed the meaning of
In determining that
The Lu Junhong court deemed its interpretation of the word “order” in
The Court remarked in Kircher [v. Putnam Funds Trust, 547 U.S. 633, 641 n.8 (2006)], that Congress has on occasion made the rule of
§ 1447(d) inapplicable to particular “orders“—and for this the Court cited, among other statutes,§ 1447(d) itself. We take both Congress and Kircher at their word in saying that, if appellate review of an “order” has been authorized, that means review of the “order.” Not particular reasons for an order, but the order itself.
And the Lu Junhong court further determined that
[Section] 1447(d) was enacted to prevent appellate delay in determining where litigation will occur. . . . But once Congress has authorized appellate review of a remand order—as it has authorized review of suits removed on the authority
of § 1442—a court of appeals has been authorized to take the time necessary to determine the right forum. The marginal delay from adding an extra issue to a case where the time for briefing, argument, and decision has already been accepted is likely to be small.
Id. at 813 (citations omitted). Any concern that unscrupulous defendants will use the
B. Statutory Analysis
To decide the scope of our appellate review of the district court‘s remand order—and determine whether to follow Lu Junhong or the opposing weight of circuit authority on the issue—we must construe the meaning of
“The goal of statutory interpretation is to ascertain the congressional intent and give effect to the legislative will.” In re Taylor, 899 F.3d 1126, 1129 (10th Cir. 2018) (internal quotation marks omitted). “In conducting this analysis, we first turn to the statute‘s plain language,” id., as “[a] statute clear and unambiguous on its face must be interpreted according to its plain meaning,” In re Geneva Steel Co., 281 F.3d 1173, 1178 (10th Cir. 2002).
“A statute is ambiguous when it is capable of being understood by reasonably well-informed persons in two or more different senses.” United States v. Quarrell, 310 F.3d 664, 669 (10th Cir. 2002) (internal quotation marks omitted). “The plainness or ambiguity of statutory language is determined by reference to the language itself, the specific context in which that language is used, and the broader context of the statute as a whole.” Ceco Concrete Const., LLC v. Centennial State Carpenters Pension Tr., 821 F.3d 1250, 1258 (10th Cir. 2016) (quoting Robinson v. Shell Oil Co., 519 U.S. 337, 341 (1997)). If statutory meaning cannot be derived “merely by reference to the text, we may also look to traditional canons of statutory construction to inform our interpretation,” Conrad v. Phone Directories Co., 585 F.3d 1376, 1381 (10th Cir. 2009), and “may seek guidance from Congress‘s intent, a task aided by reviewing the legislative history,” In re Geneva Steel Co., 281 F.3d at 1178. “Ambiguous text can also be decoded by knowing the purpose behind the statute.” Id.
Because text alone does not clarify the meaning of
1. Text and Context
The “except” clause states “that an order remanding a case . . . removed pursuant to section 1442 or 1443 . . . shall be reviewable[.]”
By modifying its reference to appealability in such way,
Contextual analysis next requires “examining the subsection‘s structure.” In re Woods, 743 F.3d 689, 694 (10th Cir. 2014); see Davis v. Mich. Dep‘t of Treasury, 489 U.S. 803, 809 (1989) (“[T]he words of a statute must be read in their context and with a view to their place in the overall statutory scheme.“). That is,
Application of these guidelines leads us to believe that the “except” clause must be narrowly construed. See In re Woods, 743 F.3d at 698. As the Counties note,
Because Congress did not indicate any such intent, the phrase ‘pursuant to section 1442 or 1443’ must be construed “in a way that allows the rule‘s exception to function as just that—an exception.” In re Woods, 743 F.3d at 699. Interpreting the “except” clause to create review of only its two enumerated removal bases, rather than all other bases rejected by a district court in
851 (10th Cir. 1959).8 In thereby harmonizing
Instead of addressing this statutory context, Defendants argue that the scope of
the controlling question of law identified by the district court[.]” 516 U.S. at 204. Per the text of
Even though Yamaha interpreted a distinct section of the Judicial Code concerning neither removal nor remand, the Court’s interpretation of “order” might at first glance appear analogous, as both
Such is the case here: The contextual differences between
Strengthening our determination that “order” was employed with different intent in the two statutes is the basic observation that, while both
[Section] 1292(b) permits appellate review of important issues before final judgment, but it does not make otherwise non-appealable questions reviewable. Reading “order” to authorize plenary review thus makes sense in the
§ 1292(b) context, as§ 1292(b) only affects the timing of review for otherwise appealable questions. But giving the word “order” the same meaning in the§ 1447(d) context would mandate review of issues that are ordinarily unreviewable, period—even following a final judgment.
City of Baltimore, 952 F.3d at 460. We find this analysis persuasive. Put another way, to read “order” the same way in both
These differences between the two statutes, expressed in terms of both structure and function, have important practical application in assessing appellate jurisdiction, as both this court and others have noted. For example, In re Bear River addressed a district court’s use of
Bear River and Feidt provide added authority for our conclusion that the contextual contrast between the two statutes—
Besides marshalling Yamaha, Defendants assert that our opinion in Coffey v. Freeport McMoran Copper & Gold, 581 F.3d 1240 (10th Cir. 2009), also “counsels in favor of review of the district court’s entire order, not simply the ground that permitted appeal.” Appellant Br. at 11. Like the district court, we are not convinced.
Coffey concerned a provision of
We held that
Defendants thus correctly note that this circuit has “already applied Yamaha’s rationale to another statutory provision concerning removal.” Appellant Br. at 14. But we reject their argument that the removal provision construed in Coffey “contains statutory language that mirrors the language of [
of judicial procedure authorizing an action to be brought by 1 or more representative persons”);
Other textual differences between the statutes also counsel against applying Coffey’s interpretation of
One further lesson relevant to our present task can be drawn from Coffey’s construction of
But such a middle path is exactly what was chosen in Coffey. We elected to review only one of the rejected bases for removal challenged by the defendants (the CAFA basis) while declining to exercise jurisdiction over the other (the CERCLA basis). See 581 F.3d at 1247–48. And we interpreted
In sum, bearing in mind that “[a]mbiguity is a creature not of definitional possibilities but of statutory context,” Brown v. Gardner, 513 U.S. 115, 118 (1994), our analysis of Yamaha and Coffey indicates that the word “order” in the singular statutory context of
We recognize, however, that the question of ambiguity is close, as our extended exegesis necessarily implies. And the circuit split on which way
Because the text of
2. Presumption Against Jurisdiction
If an ambiguity is found in the text, “[w]e then look to presumptions that might aid our analysis.” Pritchett, 420 F.3d at 1094. “Because the jurisdiction of federal courts is limited, there is a presumption against our jurisdiction.” Merida Delgado v. Gonzales, 428 F.3d 916, 919 (10th Cir. 2005) (quotation marks omitted); see Kokkonen, 511 U.S. at 377. This presumption is manifested in “the deeply felt and traditional reluctance of th[e Supreme] Court to expand the jurisdiction of the federal courts through a broad reading of jurisdictional statutes.” Romero v. Int’l Term. Op. Co., 358 U.S. 354, 379 (1959). Thus, “statutes conferring jurisdiction on federal courts are to be strictly construed, and doubts resolved against federal jurisdiction.”F & S Const. Co. v. Jensen, 337 F.2d 160, 161 (10th Cir. 1964). This includes statutes authorizing federal appellate jurisdiction. Cal. Coastal Comm’n v. Granite Rock Co., 480 U.S. 572, 579 (1987); see,
The presumption against jurisdiction also applies with full force to removal. Interpreting a precursor to the general removal statute,
Pritchett v. Office Depot, Inc. concerned the removal provisions of CAFA. See 420 F.3d at 1092. We acknowledged in Pritchett that while Congress sought to expand federal jurisdiction via those provisions, “when that expansion is made effective is what is at issue . . . , and that is an issue we approach cautiously.” Id. at1097 n.7 (citing Shamrock, 313 U.S. at 108–09); see also Becenti v. Vigil, 902 F.2d 777, 780 (10th Cir. 1990) (acknowledging that while Congress could authorize removal of tribal court actions against federal officers, at issue was whether it “has in fact done so” via
“Thus, if there is ambiguity as to whether the instant statute confers federal jurisdiction over this case, we are compelled to adopt a reasonable, narrow construction.” Pritchett, 420 F.3d at 1095. By confining appellate review to only the
3. Legislative Ratification
A second presumption that can help parse ambiguous text is the principle of legislative ratification—that “Congress is presumed to be aware of an administrative or judicial interpretation of a statute and to adopt that interpretation when it
Both parties rely on this presumption to draw divergent meaning from Congress’s passage of the Removal Clarification Act of 2011, which authorized appellate review of orders remanding cases removed pursuant to
following the 1996 decision in Yamaha. See also County of San Mateo, 960 F.3d at 597 (stating that when the Clarification Act was passed, “no circuit court had applied Yamaha to
Against this “backdrop of unanimous judicial interpretation,” id., the Clarification Act’s sole revision to
“Absent a clear statutory command to the contrary, we assume that Congress is ‘aware of the universality of th[e] practice’ of denying appellate review of remand orders when Congress creates a new ground for removal.” Things Remembered, 516 U.S. at 128 (alteration in original) (quoting United States v. Rice, 327 U.S. 742, 752 (1946)). Likewise, we will assume Congress was aware of the universality of denying plenary review of remand orders under the
4. Statutory Purpose
“Where the language of a statute is arguably ambiguous, courts also look to public policy considerations to cast further elucidation on Congress’[s] likely intent.” Pritchett, 420 F.3d at 1097. “
Defendants argue that mandating review of the complete remand order “comports with” this statutory purpose of preventing delay, because
[o]nce Congress has permitted appellate review of a remand order, an appellate court “has been authorized to take the time necessary to determine the right forum,” and “[t]he marginal delay from adding an extra issue to a case where the time for briefing, argument, and decision has already been accepted is likely to be small.”
Appellant Opp. to Mot. for Partial Dismissal at 9 (quoting Lu Junhong, 792 F.3d at 813). The leading treatise on federal civil procedure agrees: Although “it has been held that review [under
Charles A. Wright et al., Federal Practice and Procedure § 3914.11, at 706 (2d ed. 2019); see Appellant Opp. to Mot. for Partial Dismissal at 9.
The Counties contend this argument “is not obvious on its face,” because “a court of appeals may be able to summarily dispose—even in an expedited manner—of a weak argument under
This case provides a prime example of the potential delay occasioned by adding more complex federal jurisdictional issues to the appellate docket. As the district court reasoned in denying Defendants’ motion to stay the remand order:
“Unlike the situation in [Lu] Junhong, where ‘the marginal delay from adding an extra issue to [a] case . . . [‘] would be small . . . the time needed to address the numerous additional jurisdictional issues in this case would be significant.” Boulder County II, 423 F. Supp. 3d at 1071. In Lu Junhong, besides
§ 1442 , the Seventh Circuit needed to review only one other source of federal jurisdiction (admiralty jurisdiction under28 U.S.C. § 1333 ). See 792 F.3d at 808. But here, expanding review to the entire remand order would force this court to grapple with complex judge-made doctrines of “arising under” jurisdiction—implicating federal common law, contested and substantial embedded federal issues, see Grable, 545 U.S. at 312–13, and the complete preemption doctrine14—in addition to more “bespoke jurisdictional law,” Rhode Island v. Chevron Corp., 393 F. Supp. 3d 142, 151 (D.R.I. 2019), pertaining to federal enclaves and the outer continental shelf. The pages of the Federal Supplement are rapidly filling with the extended discussions occasioned by application of these doctrines to global warming-based state law actions. See, e.g., Boulder County I, 405 F. Supp. 3d at 956–79; Mayor & City Council of Baltimore v. BP P.L.C., 388 F. Supp. 3d 538, 551–67 (D. Md. 2019), aff‘d, 952 F.3d 452 (4th Cir. 2020).
It is thus not apparent that expanding the scope of
The potential for this latter result speaks to the Counties’ “moral hazard” policy argument—that allowing for an expanded scope of review “would encourage removing parties to assert frivolous federal officer claims in order to bring otherwise nonappealable removal arguments to the court of appeals.” Appellee Mot. for Partial Dismissal at 10. Similar moral hazard issues of appealability have not escaped judicial notice. In Abney v. United States, 431 U.S. 651 (1977), the Supreme Court held that a criminal defendant may immediately appeal a district court‘s rejection of her motion to dismiss an indictment on double jeopardy grounds “based on the special considerations permeating claims of that nature.” Id. at 663. But it further determined that “obviously, such considerations do not extend” to allow the appeal of “other claims presented to, and rejected by, the district court in passing on the accused‘s motion to dismiss.” Id. “Any other rule would encourage criminal defendants to seek review of, or assert, frivolous double jeopardy claims in order to bring more serious, but otherwise nonappealable questions to the attention of the courts of appeals prior to conviction and sentence.” Id. And while Abney was confined to the criminal context, “the concern expressed in Abney . . . bears on civil cases as well.” Swint v. Chambers Cty. Comm‘n, 514 U.S. 35, 49–50 (1995).
In Lu Junhong, the Seventh Circuit reasoned that sanctions and summary resolutions are sufficient tools to combat citing
***
In sum, while the text of
III. FEDERAL OFFICER REMOVAL
Having determined
The federal officer removal statute permits removal of state court actions filed against “any officer (or any person acting under that officer) of the United States or of any agency thereof, in an official or individual capacity, for or relating to any act under color of such office.”
or for [federal officers or agents] in affirmatively executing duties under . . . federal law,” Watson, 551 U.S. at 151 (alterations in original) (quoting City of Greenwood v. Peacock, 384 U.S. 808, 824 (1966)). And
A private corporation may remove a case under
§ 1442(a)(1) if it can show: (1) that it acted under the direction of a federal officer; (2) that there is a causal nexus between the plaintiff‘s claims and the acts the private corporation performed under the federal officer‘s direction; and (3) that there is a colorable federal defense to the plaintiff‘s claims.18
Greene v. Citigroup, Inc., No. 99-1030, 2000 WL 647190, at *2 (10th Cir. May 19, 2000) (unpublished); see also Sawyer v. Foster Wheeler LLC, 860 F.3d 249, 254 (4th Cir. 2017).
ExxonMobil asserts federal officer removal jurisdiction based on its long-term mining of the Outer Continental Shelf (“OCS“) for fossil fuels under government leases. Appellant Br. at 38; see, e.g., App. 49, 62 (“Oil and Gas Lease of Submerged Lands Under the Outer Continental Shelf Lands Act.“). To address this argument, we first lay out the regulatory background of these mineral leases.
The OCS “is a vast underwater expanse” beginning several miles off the coastline and extending seaward for roughly two hundred miles. Ctr. for Sustainable Econ. v. Jewell, 779 F.3d 588, 592 (D.C. Cir. 2015).
Its “subsoil and seabed appertain to the United States and are subject to its jurisdiction and control.”
OCS lessees are required to conduct drilling in accordance with federally approved exploration, development, and production plans and conditions. App. 64 § 9 (2016 lease exemplar); see
DOI officials reserve the right to obtain “prompt access” to facilities and records of private OCS lessees for the purpose of federal safety, health, or environmental inspections. App. 64 § 12 (2016 lease). The federal government can precondition an OCS lease on a right of first refusal to purchase all production “[i]n time of war or when the President of the United States shall so prescribe.” App. 68 § 15(d). The government also mandates that twenty percent of all crude or natural gas produced pursuant to OCS leases be offered to small or independent refiners, “as defined in the Emergency Petroleum Allocation Act of 1973.” App. 68 § 15(c). ExxonMobil argues that its participation in the OCS leasing program under these terms and conditions satisfies the “acting under” element of federal officer removal. Appellant Br. at 38. We disagree.
“The statutory phrase ‘acting under’ describes ‘the triggering relationship between a private entity and a federal officer.‘” City of Baltimore, 952 F.3d at 462 (quoting Watson, 551 U.S. at 149). While “[t]he words ‘acting under’ are broad,” they are “not limitless.” Watson, 551 U.S. at 147. In this context, “under” describes a relationship between private entity and federal
In Watson, the Supreme Court addressed whether the Philip Morris Companies were “acting under” a federal officer or agency when they advertised cigarettes as “light” in compliance with detailed Federal Trade Commission supervision of cigarette testing. 551 U.S. at 146–47. As private contracting was not at issue, the Court disclaimed deciding “whether and when particular circumstances may enable private contractors to invoke the statute.” Id. at 154. In an effort to establish the necessary amount of federal direction, however, the defendants highlighted various lower court cases that held government contractors could invoke
The Watson Court illustrated this point by reference to a Fifth Circuit case, Winters v. Diamond Shamrock Chemical Co., 149 F.3d 387 (5th Cir. 1998). Winters involved tort claims brought against chemical firms premised on their production of the defoliant known as Agent Orange under a Department of Defense contract for use in the Vietnam War. The Fifth Circuit concluded that both the “acting under” and causal nexus elements needed for a private company to remove under
The Phillip Morris Companies also claimed
Watson teaches that a private contractor‘s compliance with statutory or regulatory mandates, even if complex, is insufficient to satisfy the “acting under” requirement for federal officer removal. Rather, the company must agree to help carry out the duties of the federal superior under that superior‘s strict guidance and control. See In re MTBE, 488 F.3d at 125 (“describing the need for some government intervention or control, other than that contemplated by a generally applicable regulatory scheme, as ‘regulation plus‘” (quoting Bakalis v. Crossland Sav. Bank, 781 F. Supp. 140, 145 (E.D.N.Y. 1991))). In addition, this closely supervised and directed work must help federal officers fulfill basic government needs, accomplish key government tasks, or produce essential government products—that is, it must stand in for critical efforts the federal superior would be required to undertake itself in the absence of a private contract, with wartime production being the paradigmatic example. Compare Ruppel v. CBS Corp., 701 F.3d 1176, 1181 (7th Cir. 2016) (“Cases in which the Supreme Court has approved removal involve defendants working hand-in-hand with the federal government to achieve a task that furthers an end of the federal government.“), with County of San Mateo, 960 F.3d at 600 (“[A] person is not ‘acting under’ a federal officer when the person enters into an arm‘s-length business arrangement with the federal government or supplies it with widely available commercial products or services.“). Alternately, the requisite “special relationship” can be established through the explicit delegation of legal authority to act on the federal superior‘s behalf.
Here, ExxonMobil‘s OCS leases do not contemplate the “close supervision of the private entity by the Government,” Isaacson, 517 F.3d at 137, needed to bring a federal contractor relationship within these strict parameters. We agree with the district court‘s determination that under the OCS leases “the government does not control the manner in which Defendants drill for oil and gas, or develop and produce the product.” 405 F. Supp. 3d at 976; accord City of Baltimore, 952 F.3d at 466 (“[T]he leases do not appear to dictate that Defendants extract fossil fuels in a particular manner. . . . [n]or do they appear to vest the government with control over the composition of oil or gas to be refined and sold to third parties.” (citations and quotation marks omitted)); see also County of San Mateo, 960 F.3d at 602–03 (holding the OCS leases do not require lessees to act under the government‘s “close direction“). As the physical mining of OCS fuels is not subject to DOI‘s “detailed and ongoing control,” see Betzner v. Boeing Co., 910 F.3d 1010, 1015 (7th Cir. 2018), and as OCS-produced fuel need not conform to “highly detailed . . . specifications,” see Sawyer, 860 F.3d at 253, ExxonMobil was not “acting under” a federal superior within the meaning of the federal officer statute. Compare Bennett v. MIS Corp., 607 F.3d 1076, 1087–88 (6th Cir. 2010) (holding a mold remediation firm whose workers were directly supervised by on-site federal officers and escorted at all times by federal personnel, and whose “closely monitored” contract work was subject to “explicit parameters for site containment and waste disposal,” satisfied the “acting under” requirement), with Cabalce v. Thomas E. Blanchard & Assocs., 797 F.3d 720, 728 (9th Cir. 2015) (holding a company that contracted to store and destroy fireworks seized by the government did not act under
ExxonMobil disputes the district court‘s finding of insufficient government control by asserting that “the operative leases explicitly afford the federal government the right to control the rates of mining and production.” Appellant Br. at 40. It supports this contention by reference to a single clause in the 1979 lease: “After due notice in writing, the Lessee shall drill such wells and produce at such rates as the Lessor may require in order that the leased area . . . may be properly and timely developed[.]” App. 50 § 10. There is no similar clause in the 2016 lease, however, and no indication that the 1979 language remains in effect. See App. 50 § 3 (stating that the 1979 lease shall cover an initial five-year period, to be extended “so long thereafter” as production from or operation on the leased parcel continues). Additionally, there is no showing the government ever gave notice of its intent to direct ExxonMobil‘s drilling activity or rates of production by means of the OCS leases. The same is true with respect to the government‘s wartime right of first refusal over ExxonMobil‘s OCS output. Even if the exercise of these rights could create the necessary level of federal supervision, an issue we do not decide, ExxonMobil points us to no authority for the proposition that the reservation of such rights alone creates the “special relationship” needed for a private firm to invoke
ExxonMobil‘s other attempts to parse the lease language in support of federal officer removal are likewise unavailing, see Cabalce, 797 F.3d at 729, because most of the contractual terms “are mere iterations of the OCSLA‘s regulatory requirements.” City of Baltimore, 952 F.3d at 465; accord County of San Mateo, 960 F.3d at 603; see, e.g.,
A holding that “simple compliance” with the statutory and regulatory requirements embedded in these standard-form, boilerplate lease terms satisfies the “acting under” relationship would risk “expand[ing] the scope of the statute considerably” to include “state-court actions filed against private firms in many highly regulated industries.” See Watson, 551 U.S. at 153 (“Neither language, nor history, nor purpose lead us to believe that Congress intended any such expansion.“). Such a result is incompatible with the Watson Court‘s careful articulation of when a private firm can invoke federal officer removal. We thus agree with the Fourth and Ninth Circuits that “‘the willingness to lease federal property or mineral rights to a private entity for the entity‘s own commercial purposes, without more[,]’ cannot be ‘characterized as the type of assistance that is required’ to show that the private entity is ‘acting under’ a federal officer.” County of San Mateo, 960 F.3d at 603 (quoting City of Baltimore, 952 F.3d at 465).
Additionally, the OCS leases do not meet the “acting under” parameters because they do not call for production specially conformed to government use—the type of contract that “involve[s] an effort to assist, or to help carry out, the duties or tasks of the federal superior.” Watson, 551 U.S. at 152. See Sawyer, 860 F.3d at 255 (stating that courts often find the “acting under” requirement satisfied “where a contractor seeks to remove a case involving injuries arising from equipment that it manufactured for the government“); Mays, 871 F.3d at 445 (“[A] government contractor entitled to removal would presumably be contractually required to follow the federal government‘s specifications in making products or providing services.“).
In the Agent Orange cases, for example, the military provided precise specifications to private firms that “included use of the two active chemicals in unprecedented quantities for the specific purpose of stripping certain areas of Vietnam of their vegetation.” Winters, 149 F.3d at 399; see also Betzner, 910 F.3d at 1015 (holding that Boeing “acted under the military‘s detailed and ongoing control” in “manufactur[ing] heavy bomber aircraft for the United States Air Force“); Sawyer, 860 F.3d at 253, 255 (holding that a contractor “acted under the Navy” in manufacturing boilers “to match highly detailed ship specifications and military specifications provided by the Navy“). Here, ExxonMobil is not tailoring its output to detailed federal formulations customized to meet pressing federal needs. Rather, it is leasing federal land to facilitate commercial production of a standardized, undifferentiated consumer product. See Jewell, 779 F.3d at 607 (determining DOI‘s decision “not to earmark the point of consumption of OCS-derived
Lastly, ExxonMobil cannot show the delegation of legal authority that the Watson Court hypothesized would be sufficient to conclude a private corporation was “acting under” a government superior. No highlighted lease provision “establish[es] the type of formal delegation that might authorize [ExxonMobil] to remove the case.” Watson, 551 U.S. at 156; see County of San Mateo, 960 F.3d at 602 (“The leases do not require that lessees act on behalf of the federal government.“). And “neither Congress nor federal agencies normally delegate legal authority to private entities without saying that they are doing so.” Watson, 551 U.S. at 157.
Our determination that ExxonMobil was not “acting under” federal officers in drilling pursuant to OCS leases is not altered by the OCS‘s status as a “vital national resource reserve held by the Federal Government for the public.”
IV. CONCLUSION
Title 28, U.S. Code
Notes
Section 1292(b) reads, in relevant part:
When a district judge, in making in a civil action an order not otherwise appealable under this section, shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order. The Court of Appeals which would have jurisdiction of an appeal of such action may thereupon, in its discretion, permit an appeal to be taken from such order, if application is made to it within ten days after the entry of the order[.]