St. Bernard Parish v. Atlantic Richfield Company et al

Filing 89

ORDERED that Plaintiffs' Motions for Remand (Rec. Docs. 16 , 18 ) are GRANTED. Signed by Judge Carl Barbier. (Attachments: # 1 Remand Letter) (gec)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

ST. BERNARD PARISH

CIVIL ACTION

VERSUS

NO: 16-16294

ATLANTIC RICHFIELD COMPANY,
ET AL.

SECTION: “J”(4)

ORDER AND REASONS
Before the Court are two motions to remand, one filed by
Plaintiff St. Bernard Parish (Rec. Doc. 16) and the other by
Intervenors, the State of Louisiana, through Jeff Landry, Attorney
General, and the State of Louisiana, through the Department of
Natural Resources (Rec. Doc. 18). Defendants Atlantic Richfield
Co., et al. have filed multiple oppositions.

At the direction of

the Court, the parties have filed supplemental memoranda on the
issue of federal question jurisdiction.

Having considered the

motion and legal memoranda, the record, and the applicable law,
the Court finds that the motions should be GRANTED.
FACTUAL AND PROCEDURAL BACKGROUND
This litigation derives from Defendants’ alleged violation of
Louisiana’s State and Local Coastal Resources Management Act of
1978 and associated coastal regulations and local ordinances, La.
Rev. Stat. § 49:214.21 et seq., (collectively “CZM Laws”).

(Rec.

Doc. 1-2 at 1). The Parish and Intervenors assert that Defendants’
1

oil and gas exploration, production, and transportation operations
violated state permitting laws by causing substantial damage to
land and waterbodies defined by the CZM Laws.
4,

8-9).

Specifically,

the

Parish

(Rec. Doc. 1-2 at

alleges

that

Defendants

constructed and used unlined earthen waste pits located within the
Parish’s coastal zone.

(Rec. Doc. 1-2 at 11.)

The Parish claims

that the use of these waste pits has had a direct and significant
impact

on

the

coastal

waters

located

within

the

Parish

and

therefore a coastal use permit (“CUP”) was necessary for each.
Although the Parish alleges that the waste pits were constructed
after enactment of the CZM Act of 1978, it asserts that any waste
pits constructed before its enactment would still require CUP
applications.

The Parish alleges that Defendants violated the CZM

Laws by not obtaining the required CUPs.

Ultimately, the Parish

asserts that Defendants’ use of waste pits in the St. Bernard
Parish coastal zone and their failure to properly close the pits
and revitalize the sites have caused significant damage.
The Parish filed this suit in state court and on November 10,
2016, Defendants removed it to this Court. In response, the Parish
and Intervenors filed the instant motions to remand.

In light of

the Fifth’s Circuit’s ruling in Board of Commissioners of Southeast
Louisiana

Flood

Protection

Authority-East

v.

Tennessee

Gas

Pipeline Co., L.L.C., 850 F.3d 714 (5th Cir. 2017), this Court
instructed

the

parties

to

brief
2

whether

federal

question

jurisdiction exists over this case.

The briefing is complete and

the motions are now before the Court.
LEGAL STANDARD
A defendant may remove a civil action filed in state court if
a federal court would have had original jurisdiction over the
action. See 28 U.S.C. § 1441(a). The removing party bears the
burden of proving by a preponderance of the evidence that federal
jurisdiction exists at the time of removal. DeAguilar v. Boeing
Co., 47 F.3d 1404, 1408 (5th Cir. 1995). The jurisdictional facts
supporting removal are examined as of the time of removal. Gebbia
v. Wal-Mart Stores, Inc., 233 F.3d 880, 883 (5th Cir. 2000).
Ambiguities are construed against removal and in favor of remand,
because removal statutes are to be strictly construed. Manguno v.
Prudential Prop. & Cas. Ins., 276 F.3d 720, 723 (5th Cir. 2002).
A civil action originally filed in state court may be removed
to federal court on the basis of federal question jurisdiction if
that matter is “founded on a claim or right arising under the
Constitution, treaties or laws of the United States.” 28 U.S.C. §
1441(b); see also 28 U.S.C. § 1331. In determining whether federal
question jurisdiction exists over a matter, courts apply the “wellpleaded

complaint

rule,”

which

considers

whether

a

federal

question is presented on the face of a plaintiff’s properly pleaded
complaint. Rivet v. Regions Bank of La., 522 U.S. 470, 475 (1998)
(citing Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987)).
3

Because the well-pleaded complaint rule focuses solely on whether
a

plaintiff

has

“affirmatively

alleged”

a

federal

claim,

“potential defenses . . . do not provide a basis for federal
question

jurisdiction.”

New

Orleans

&

Gulf

Coast

Ry.

Co.

v.

Barrois, 533 F.3d 321, 328 (5th Cir. 2008) (citing PCI Transp.,
Inc. v. Fort Worth & W. R.R. Co., 418 F.3d 535, 543 (5th Cir.
2005)). In fact, removal is not warranted pursuant to federal
question jurisdiction “on the basis of a federal defense . . .
even if the defense is anticipated in the plaintiff’s complaint,
and even if both parties admit that the defense is the only
question truly at issue in the case.” Franchise Tax Bd. of Cal. v.
Constr. Laborers Vacation Trust for So. Cal., 463 U.S. 1, 13
(1983).
Despite the applicability of the well-pleaded complaint rule,
a claim which has origins in state law may still be found to arise
under federal law if it falls within a “special and small category”
of cases. Gunn v. Minton, 133 S. Ct. 1059, 1064 (2013) (citing
Empire Healthchoice Assurance, Inc. v. McVeigh, 547 U.S. 677, 699
(2006)). The Supreme Court articulated the test for determining
whether a claim falls within this narrow category, finding that
federal question jurisdiction attaches to state law claims where:
(1) resolving a federal issue is necessary to resolution
of the state-law claim; (2) the federal issue is actually
disputed; (3) the federal issue is substantial; and (4)
federal jurisdiction will not disturb the balance of
federal and state judicial responsibilities.
4

Singh v. Duane Morris LLP, 538 F.3d 334, 338 (5th Cir. 2008)
(citing Grable & Sons Metal Products, Inc. v. Darue Engineering &
Manufacturing, 545 U.S. 308, 314 (2005)). However, the category of
cases envisioned in Grable is a “slim” one. Empire Healthchoice
Assurance, 547 U.S. at 701. Moreover, the “mere presence” of a
federal issue or the necessity of interpreting federal law “does
not

automatically

confer

federal-question

jurisdiction.”

St.

Bernard Port, Harbor & Terminal Dist. v. Violet Dock Port, Inc.,
809 F. Supp. 2d 524, 536 (E.D. La. 2011) (citing Merrell Dow Pharm.
Inc. v. Thompson, 478 U.S. 804, 813 (1986)).
DISCUSSION
Defendants assert three separate grounds for removal.

They

argue that the Parish’s claims are subject to maritime jurisdiction
and OCSLA jurisdiction, and that the Parish’s claims raise federal
questions.

The first two alleged sources of jurisdiction are

nonstarters. This Court’s jurisprudence is clear that the Parish’s
claims do not create OCSLA jurisdiction and, assuming they are
maritime claims, would not be removable solely on that ground. 1
See, e.g., Parish of Plaquemines v. Total Petrochemical & Refining

1

Many cases similar to the above-captioned matter have been filed in Louisiana
in recent years. They are commonly referred to as the “Oil Patch Cases.” See
Borne v. Chevron U.S.A. Holdings, Inc., No. CIV.A. 15-631, 2015 WL 3417520, at
*1 (E.D. La. May 27, 2015). In nearly all instances, the suits were filed in
state court, removed to federal court, and ultimately remanded back to state
court. For a brief history of how courts in this district have handled these
cases, see Plaquemines Parish v. Linder Oil Co., No. CIV.A. 13-6706, 2015 WL
2354183, at *1 (E.D. La. May 15, 2015).

5

USA, Inc., 64 F. Supp. 3d 872, 899 (E.D. La. 2014); Jefferson
Parish v. Chevron U.S.A. Holdings, Inc., No. 13-16738, 2015 WL
2229278 (E.D. La. May 12, 2015).

Defendants also make a vague

allegation that federal question jurisdiction exists over the
Parish’s claims because the state court petition “raises complex
and interrelated issues involving many areas addressed by federal
statutes and regulations.”

(See Rec. Doc. 2 at 3.)

This Court

concurs with the multiple courts in this district that have found
such nebulous allegations failed to satisfy the standard for
federal question jurisdiction.

See, e.g., Plaquemines Parish v.

Rozel Operating Co., No. CIV.A. 13-6722, 2015 WL 403791, at *5
(E.D. La. Jan. 29, 2015); Borne v. Chevron U.S.A. Holdings, Inc.,
No. CIV.A. 15-631, 2015 WL 3417520, at *3-4 (E.D. La. May 27,
2015).
However, Defendants present a unique argument in favor of
federal question jurisdiction that has not been raised in similar
suits previously filed by Louisiana parishes against oil and gas
exploration and production companies.

Here, Defendants assert

that federal question jurisdiction exists over the Parish’s claims
because

they

rely,

at

least

in

part,

on

federal

regulations

promulgated by the Army Corps of Engineers (“COE”).
reasons described below, the Court disagrees.

6

For the

After the Parish and Intervenors filed their motions to
remand,

the

Fifth

Circuit

issued

its

opinion

in

Board

of

Commissioners of Southeast Louisiana Flood Protection AuthorityEast v. Tennessee Gas Pipeline Co., L.L.C., 850 F.3d 714 (5th Cir.
2017).
existed

There, the court held that federal question jurisdiction
over

the

plaintiff’s

negligence

and

nuisance

claims

because some of the claims relied on federal law to hold the
defendants liable.

Id. at 722.

The Fifth Circuit noted that if

state law did not establish a duty, then the “duty would have to
be drawn from federal law.”

Id. at 723.

The court ultimately

concluded that the case arose under federal law because the state
law claims could not be resolved without analyzing whether the
duty

of

care

breached.

Id.

created

by

multiple

federal

standards

had

been

In light of Tennessee Gas, this Court instructed

the parties to further brief whether the Parish’s claims relied
upon federal regulatory standards for relief.
After reviewing the supplemental memoranda, the Court is
satisfied that federal question jurisdiction does not exist over
the Parish’s claims.

This case is fundamentally about allegations

that Defendants violated state regulations.

The Parish claims

that Defendants violated various provisions of the State and Local
Coastal

Resources

Management

Act

49:214.21 et seq., (“the CZM Laws”).

of

1978,

La.

Rev.

Stat.

§

The CZM Laws use a permitting

system to regulate certain activity that occurs within the coastal
7

zone of Louisiana.

Under this regulatory scheme, all entities

interested in commencing a “use” within the state’s coastal zone
must first apply for a coastal use permit (“CUP”) from Louisiana’s
Office of Coastal Management (“OCM”).

A “use” 2 is

§ 49:214.30.

defined as “any use or activity within the coastal zone which has
a

direct

and

significant

49:214.23(13).

impact

on

coastal

waters.”

§

If the OCM finds that an activity is likely to

have a direct and significant impact, then it will decide whether
to grant a CUP.

See § 49:214.30(A)(1).

Once a CUP has been

granted, the OCM has the authority to create conditions with which
the CUP-holder must comply.

See § 49:214.36(C).

If the user

violates any terms or conditions of the CUP, the OCM may suspend,
revoke, or modify the CUP or bring legal action.

§ 49:214.36(C)-

(D).
However, not all activity that occurs within the geographical
boundaries of the coastal zone constitutes a “use.”
49:214.34(A).

For

instance,

a

person

wishing

to

See §

commence

an

activity that will not to have a “direct and significant impact on
coastal

waters”

49:214.34(A).

is

not

required

to

apply

for

a

CUP.

§

Occasionally, entities apply for a CUP even though

the activity they intend to undertake is unlikely to have a direct
and significant impact on coastal waters.

2

When the OCM reviews

La. Rev. Stat. § 49:214.25 distinguishes between two types of uses: uses of
state concern and uses of local concern.
The statute also includes nonexhaustive lists enumerating the type of activities that can be considered uses.

8

such an application, it issues a determination that the activity
has “no direct and significant impact” on coastal waters.
Doc. 82 at 1); See § 49:214.34.
determination.”

(Rec.

This is referred to as an “NDSI

When the OCM makes an NDSI determination, the

applicant is then free to commence the activity without a CUP.

An

NDSI determination does not provide the recipient with free reign
to engage in conduct that will damage the coastal zone.

If

activity that has received an NDSI determination should later be
determined to have a direct and significant impact on coastal
waters, then the person responsible for the activity must apply
(or re-apply) for a CUP at that point.
At issue here is whether federal question jurisdiction exists
over activities in the coastal zone that do not require CUPS.

An

activity that does not require a CUP may still require a permit
from the Army Corps of Engineers (“COE”) under an entirely separate
federal regime.

Defendants use this separate COE regulatory

standard to argue that the validity of at least some of the
Parish’s claims cannot be properly determined without analysis of
the COE’s federal standard.
Defendants’ argument is premised on a misinterpretation of
the effect of the OCM’s decision not to issue a CUP.

This decision

does not mean that COE permits or federal law create the new
standard – the standard set by the CZM laws still applies to
activities that do not require a CUP.
9

As stated above, an initial

NDSI determination does not insulate an entity from obligations
under the CZM Laws if its operations affect the coastal zone.

If,

over

and

time,

the

entity’s

activities

begin

to

directly

significantly impact coastal waters, it must then re-apply for a
CUP. This is because the CZM laws allow the OCM to take action
against any and all unpermitted and unmitigated damage to the
coastal zone.

Any failure to re-apply for a CUP at this point is

a failure to abide by state—not federal—laws.
Defendants refer the Court to an exhibit that the Parish
attached to its state law petition.

The petition refers to the

exhibit as a list of all CUPs granted in the Parish’s coastal zone
(“Permit List”).

The Parish later clarified that the Permit List

is actually a “list of all CUP numbers under which CUP applications
were filed.” (Rec. Doc. 82 at 6) (emphasis added). In other words,
the Permit List includes all CUP applications for the Parish’s
coastal zone from the enactment of the CZM Laws, irrespective of
whether a CUP was granted.

Defendants seized upon this Permit

List to point out that some of the files on it never had CUPS
granted and are only regulated by federal COE standards.

As a

result, Defendants argue that the Court must rely on federal COE
regulations when determining the validity of the Parish’s claims
with respect to these files.

However, the COE standards are not

relevant to this determination.

10

Whether the CZM Laws have been

violated

can

be

determined

without

referring

to

any

federal

standards.
Defendants also point out that in the years immediately
following enactment of the CZM Laws, the responsible state agency
had

not

yet

developed

the

permitting

system

it

uses

today.

Defendants assert that one of the permit files in the Permit List
includes the following statement from that time period:
We have received your application for a coastal use
permit for the activity listed above.
In accordance
with La. R.S. 49, Section 213.11E, the Coastal
Management Section of the Department of Natural
Resources is in the process of developing policies for
issuing general and area permits. Until such policies
are developed, the above referenced Corps of Engineers
permit will suffice, and a coastal use permit will not
be necessary.
(Rec. Doc. 26 at 28; Rec. Doc. 83 at 3) (emphasis added).
was ever issued for this permit file.

No CUP

Defendants assert that the

situation is identical for at least three other permit files.
Defendants argue that in these cases, the COE permits necessarily
became the applicable standard.

This reading is incorrect. The

statement that a COE permit would “suffice” did not mean that the
state relied on a federal standard; it simply meant that the state
agency found that a CUP would “not be necessary.”

And, as

described above, any CUP applicant would be required to re-apply
for a CUP if its activities would have a direct and significant
impact on the coastal area.

The COE permit “is a separate federal

permit with its own terms and conditions.”
11

(Rec. Doc. 26-1 at 7).

Thus, determining whether Defendants violated the CZM laws would
not require reference to the COE regulations.

Furthermore, the

Parish and Intervenors provide an affidavit from Keith Lovell, the
current Assistant Secretary of the OCM, who stated that the “OCM
has [n]ever relied upon any Army Corps of Engineers standards in
making any determination, exclusive or otherwise, under the [CZM
Laws].” (Rec. Doc. 82-1 at 4).
The Parish and the Intervenors repeatedly state that the OCM
never relies on COE permits because Louisiana’s OCM and the federal
COE

have

interplay

entirely
and

separate

permitting

cross-referencing

may

schemes.

exist

While

between

the

some
two

agencies, there is never a situation in which the OCM relies upon
the COE to permit or enforce the CZM laws, and the OCM does not
itself enforce COE permits.

There is no federal question involved

in this case.
CONCLUSION
Accordingly,
IT IS HEREBY ORDERED that Plaintiffs’ Motions for Remand (Rec.
Docs. 16, 18) are GRANTED.
New Orleans, Louisiana, this 6th day of July, 2017.

____________________________
CARL J. BARBIER
UNITED STATES DISTRICT JUDGE
12