Plaquemines Parish v. Northcoast Oil Company et al

Filing 80

ORDER AND REASONS granting 62 Motion to Remand to State Court. Signed by Judge Jay C. Zainey on 04/18/2023. (cs) (Additional attachment(s) added on 4/18/2023: # 1 Transmittal Letter) (cs).

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 1 of 25

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
THE PARISH OF PLAQUEMINES

CIVIL ACTION

VERSUS

NO: 18-5228

NORTHCOAST OIL CO., ET AL.

SECTION: "A" (2)

ORDER AND REASONS
Before the Court is a Motion to Remand (Rec. Doc. 62) filed jointly by the
plaintiff, the Parish of Plaquemines, and the plaintiff-intervenors the State of Louisiana,
through the Louisiana Department of Natural Resources, Office of Coastal
Management, and its Secretary, Thomas F. Harris, and the State of Louisiana ex rel.
Jeff Landry, Attorney General. The Removing Defendants oppose the motion.1 The
motion, submitted for consideration on February 1, 2023, is before the Court on the
briefs without oral argument.
For the reasons that follow, the Court concludes that the Motion to Remand filed
in this case should be GRANTED and this civil action REMANDED to state court.
I.
This case is one of numerous cases filed in state court against a legion of oil and
gas companies under a Louisiana state law called the State and Local Coastal
Resources Management Act of 1978, La. R.S. ' 49:214.21, et seq., (“SLCRMA”), along

1

The Removing Defendants in this action are Chevron U.S.A. Inc., Chevron U.S.A.
Holdings Inc., Chevron Pipe Line Company, and BP Products North America Inc. (Rec. Doc.
1, Notice of Removal at 1).
Page 1 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 2 of 25

with the state and local regulations, guidelines, ordinances, and orders promulgated
thereunder. The SLCRMA regulates certain "uses" within the Coastal Zone of Louisiana
through a permitting system and provides a cause of action against defendants who
violate a state-issued coastal use permit or fail to obtain a required coastal use permit.
The several lawsuits pertain to the defendants’ decades-long oil production activities on
the Louisiana coast.
Each individual lawsuit challenges oil production activities occurring in a
specifically defined area, the “Operational Area,” of the Louisiana coast. The term
"Operational Area" is used throughout the plaintiffs’ petition to describe the geographic
extent of the area within which the complained-of operations and activities at issue in
this action occurred. The Operational Area at issue in this case lies in West Bay Oil and
Gas Field located in Plaquemines Parish.
Twenty-eight of the cases were filed by Plaquemines and Jefferson Parishes in
2013 and then removed to this Court on numerous grounds, including diversity, OCSLA,
maritime and federal question jurisdiction. Of those 2013 cases, the judges of this
district designated Plaquemines Parish v. Total Petrochemical & Refining USA, Inc., et
al., 13-cv-6693, as the lead case. On December 1, 2014, this Court entered its Order
and Reasons remanding the case to state court for lack of subject matter jurisdiction.
Parish of Plaquemines v. Total Petrochemical & Refining USA, Inc., 64 F. Supp. 3d 872
(E.D. La. 2014). After that decision all of the other parish cases were eventually
remanded by the judges presiding over them.
The cases then progressed in state court until May 2018 when the defendants re-

Page 2 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 3 of 25

removed the cases on grounds of federal officer removal and federal question
jurisdiction.2 Although the SLCRMA did not go into effect until 1980, the plaintiffs’
allegations (as clarified by a preliminary expert report produced in 2018—the Rozel
report) triggered the potential applicability of the statute’s grandfathering provision, La.
R.S. § 49:214.34(C)(2), which placed at issue pre-SLCRMA conduct, some of which
occurred during World War II. The defendants were convinced that their World War II
era activities presented a new opportunity for removal, i.e., federal officer removal.3
Although all of the SLCRMA cases were re-removed in 2018, only a subset of them
actually involved World War II era activities.
This time the judges of this district designated Plaquemines Parish v. Riverwood
Production Co., Inc., et al., 18-cv-5217, assigned to the late Judge Martin L.C. Feldman,
as the lead case (“Riverwood”). This Court (like the other judges of this district) stayed

2

Federal officer removal was a new theory supporting removal but federal question
jurisdiction had been raised in the 2013 removals and rejected. As a general rule, once a
case is remanded to state court, a defendant is precluded only from seeking a second
removal on the same ground. S.W.S. Erectors, Inc. v. Infax, Inc., 72 F.3d 489, 492 (5th Cir.
1996). The prohibition against removal “on the same ground” does not concern the theory
on which federal jurisdiction exists, i.e., federal question or diversity jurisdiction, but rather
the pleading or event that made the case removable. Id. (citing O'Bryan v. Chandler, 496
F.2d 403, 410 (10th Cir. 1974)). Even though the Court rejected federal question jurisdiction
in 2014, the defendants identified a new basis for federal question jurisdiction when they reremoved the SLCRMA cases in 2018. That new basis for federal question jurisdiction has
now been firmly rejected by the Fifth Circuit foreclosing federal question jurisdiction as a
basis for removal in any of the pending SLCRMA cases.
3

World War II era activities have become relevant to this case because the SLCRMA’s
grandfathering clause exempts from the coastal use permitting scheme activities ”legally
commenced or established” prior to the effective date [1980] of the coastal use permit
program, La. R.S. § 49:214.34(C)(2). The plaintiffs’ contention is that the defendants’ pre1980 activities, including those dating back to the 1940s, were not “legally commenced”
thereby depriving the defendants of the exemption. Therefore, the defendants’ pre-SLCRMA
conduct is relevant to the plaintiffs’ SLCRMA causes of action in this case.
Page 3 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 4 of 25

the six cases assigned to it (including this one) pending the decision in Riverwood.4 A
similar approach was adopted in the Western District of Louisiana because several
SLCRMA cases had been removed in that district too. The lead case chosen in the
Western District of Louisiana was Cameron Parish v. Auster Oil & Gas, Inc., 18-cv-0677
(“Auster”). The cases in this district remained stayed pending the outcomes in
Riverwood and Auster, at times over the plaintiffs’ strenuous objections, which included
seeking mandamus relief. The defendants had persuasively argued, when opposing the
plaintiffs’ motions to re-open the cases, that allowing Riverwood to proceed to
conclusion before taking up any of the other motions to remand in the SLCRMA cases
would be beneficial because the cases had common issues.
On May 28, 2019, Judge Feldman issued a comprehensive Order and Reasons
in Riverwood that explained his conclusion that the case should be remanded to state
court. Judge Feldman was persuaded that the removal was untimely; and even if it was
timely, the defendants had failed to establish that the requirements for federal officer
removal jurisdiction were satisfied, or that the case involved any specific federal issue
sufficient to support federal question jurisdiction. Parish of Plaquemines v. Riverwood
Prod. Co., No. 18-5217, 2019 WL 2271118 (E. D. La. May 28, 2019) (Feldman, J.). The
defendants appealed Riverwood, and the Fifth Circuit consolidated it with the appeal in
Auster, where the presiding judge had likewise granted the plaintiffs’ motion to remand.
Initially the Fifth Circuit affirmed Judge Feldman’s decision based on timeliness
Most of the cases had been stayed previously at the defendants’ behest because the
defendants sought to have the Judicial Panel on Multidistrict Litigation coordinate
proceedings in the various SLCRMA cases. The Panel denied the request.
4

Page 4 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 5 of 25

grounds, mooting any other jurisdictional issues.5 Parish of Plaquemines v. Chevron
USA, Inc., 969 F.3d 502 (5th Cir. 2020) (withdrawn and superseded). Although en banc
rehearing was denied, the panel granted rehearing, withdrew its earlier opinion, and
superseded it with one reversing Riverwood on the issue of timeliness, but affirming
Judge Feldman on the finding that no federal question jurisdiction existed to support
removal on that basis.6 Parish of Plaquemines v. Chevron USA, Inc., 7 F.4th 362 (5th
Cir. 2021) (“Plaquemines I”).
As to the potential for federal officer removal jurisdiction, the Fifth Circuit
reversed Judge Feldman, not because he had erred, but solely because the en banc
court had decided Latiolais v. Huntington Ingalls, Inc., 951 F.3d 286, 290 (5th Cir. 2020),
after Judge Feldman had issued his decision in Riverwood.7 The Fifth Circuit remanded
the Riverwood case to Judge Feldman to determine, now with the benefit of Latiolais,

5

Judge Robert R. Summerhays, who presided over Auster in the Western District of
Louisiana, had concluded that the removal was timely but that neither federal question
jurisdiction nor federal officer removal jurisdiction applied. Parish of Cameron v. Auster Oil &
Gas Inc., 420 F. Supp. 3d 532 (W.D. La. 2019).
6

Plaquemines I laid to rest the timeliness issue and the issue of federal question
jurisdiction, neither of which were challenged beyond the appeal in Plaquemines I. Thus,
following Plaquemines I, the sole issue going forward in Riverwood was whether federal
officer removal applied. No one questions that Plaquemines I‘s timeliness determination in
favor of the defense, and the rejection of federal question jurisdiction in favor of the
plaintiffs, applies with equal force to all of the removed SLCRMA cases. For those issues
there is simply no basis to legitimately distinguish the other SLCRMA cases from
Riverwood.
As described by Judge Feldman, in Latiolais the Fifth Circuit “overhauled its federal-officer
jurisdictional test” by eschewing the “causal nexus” element of the test in favor of a new
standard that encompassed a “broader and elusive” “related to” element. Parish of
Plaquemines v. Riverwood Prod. Co., No 18-5217, 2022 WL 101401, at *3 (E.D. La. Jan.
11, 2022).
7

Page 5 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 6 of 25

whether federal officer jurisdiction applied. Plaquemines I, 7 F.4th at 365.
Unpersuaded that Latiolais changed the outcome, Judge Feldman issued his
decision finding once again that the defendants were not entitled to remove the case
under federal officer removal, that the case did not belong in federal court, and that the
motion to remand should be granted.8 Parish of Plaquemines v. Riverwood Prod. Co.,
No. 18-5217, 2022 WL 101401, at *3 (E.D. La. Jan. 11, 2022). The Fifth Circuit affirmed,
Parish of Plaquemines v. Chevron USA, Inc., No. 22-30055, 2022 WL 9914869 (5th Cir.
Oct. 17, 2022) (“Plaquemines II”), denied rehearing, denied rehearing en banc, and
even denied the removing defendants’ motion to stay issuance of the mandate while the
defendants sought a writ of certiorari from the United States Supreme Court.
With no stay in place, the defendants in Riverwood filed their petition with the
United States Supreme Court for review of the federal officer removal issue. The Fifth
Circuit issued the Riverwood mandate on December 15, 2022, and Judge Sarah S.
Vance, who was assigned the case following Judge Feldman’s death, remanded the
Riverwood action to state court. Given that the Fifth Circuit refused to issue a stay in
Riverwood, and as a result Riverwood itself was returned to state court notwithstanding
the pending writ application, the suggestion that the Court should delay ruling on the
motions to remand in its own SLCRMA cases pending further litigation in federal court
was not persuasive. (CA18-5238, Rec. Doc. 79, Order and Reasons at 6). Therefore, on

8

It is not surprising that Latiolais did not change the outcome in Riverwood because Judge
Feldman’s decision in Riverwood did not turn on the eschewed causal nexus element of
federal officer removal. Rather, Judge Feldman had explained why the removing defendants
in Riverwood had not satisfied the “acting under” requirement for federal officer removal,
and the test for that requirement had not been affected by Latiolais.
Page 6 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 7 of 25

February 15, 2023, this Court remanded to state court Civil Actions 18-5238, 18-5262,
18-5265, which did not involve any World War II era conduct upon which to argue in
support of federal officer removal. The Court noted when remanding those cases that if
federal officer jurisdiction was lacking in Riverwood which did involve wartime activities,
it certainly could not apply to a case that did not involve wartime activities. (Rec. Doc.
79, Order and Reasons at 6-7). Further, those cases did not involve a party with a World
War II era refinery contract, which became the basis for the new theory of federal officer
removal at issue in this case. And with the potential for federal question jurisdiction now
firmly foreclosed by Plaquemines I and Plaquemines II, the defendants in Civil Actions
18-5238, 18-5262, and 18-5265 had no non-frivolous arguments to make in support of
removal in those cases.9
The issue of the pending writ application in Riverwood has become a moot point
because on February 27, 2023, after all of the briefing was concluded in this case, the
United States Supreme Court denied the Plaquemines II writ application. Chevron USA,
Inc. v. Plaquemines Parish, No. 22-715, 2023 WL 2227757 (U.S. Feb. 27, 2023). Thus,
the Fifth Circuit’s Plaquemines I and Plaquemines II decisions have now conclusively
resolved the jurisdictional issues presented in Riverwood.10

9

Moreover, the Court had reviewed the petition for certiorari filed in the Riverwood case
and had concluded that even if both questions presented in the petition were answered in
the affirmative, it would not affect the remand decision in Civil Actions 18-5238, 18-5262,
and 18-5265. Those civil actions involved neither World War II era activities nor any
defendant implicated by the refinery argument (discussed below) that the Court referred to
(by the name “the Related Refinery Case argument”) when remanding those other cases.
A notice of appeal has been filed by the defendants as to the remand orders in Civil
Actions 18-5265 and 18-5238.
10

In Auster, Judge Summerhays concluded on remand that Latiolais did not change his
Page 7 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 8 of 25

In short, Riverwood holds that the removal in 2018 was timely, federal question
jurisdiction was not present, and none of the removing defendants’ several theories for
satisfying the “acting under” requirement for federal officer removal jurisdiction had
merit, this latter issue being grounded on the removing defendants’ World War II era
activities and on World War II era refinery contracts that belonged to other parties.
Riverwood dealt a heavy blow to the defendants, who had been arguing in this district
for years (when opposing the plaintiffs’ periodic attempts to adjudicate motions to
remand in certain of the SLCRMA cases) that Riverwood would resolve jurisdictional
issues that cut across all of the removed SLCRMA cases. While Riverwood was a lost
cause, the defendants in the other SLCRMA cases like this one rallied to find a way to
distinguish their cases from Riverwood, and hence a new refinery-based argument for
federal officer removal was born. As explained in greater detail below, the Removing
Defendants’ new refinery argument purports to be based on an observation that the
Fifth Circuit made in dicta in Plaquemines II pertaining to refineries that had federal
contracts during the World War II era, and the potential for federal officer removal to be
available for those refineries.
The remaining three SLCRMA cases pending in this Section, of which the instant
case is one, involve World War II era oil production activities, that although conducted
during a time of significant governmental regulation, will not (without more) suffice for

decision as to federal officer removal as well. Parish of Cameron v. Auster Oil & Gas, Inc.,
No. 18-cv-0677, 2022 WL 17852581 (W.D. La. Dec. 22, 2022). Judge Summerhays issued
his decision after the Fifth Circuit had already affirmed Judge Feldman in Plaquemines II.
Auster has been appealed but as of this writing the appeal is in its infancy.
Page 8 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 9 of 25

federal officer removal—this is precisely what Riverwood dictates and the Removing
Defendants have conceded this argument. But the Removing Defendants contend that
this case involves a defendant who not only engaged in World War II era oil production
activities in the Operational Area but who also used some of that Operational Area
crude to perform under its own World War II era federal refinery contract, thereby
distinguishing this case from Riverwood in a material and outcome-altering way. The
availability of a federal forum for this case and the handful of SLCRMA cases that are
still pending in federal court depends solely on whether the requirements for federal
officer removal are satisfied based on the defendants’ latest refinery-contract-based
theory for federal officer removal.11
II.
The plaintiffs herein maintain that the relevant jurisdictional factual and legal
issues presented in the present case are indistinguishable from the Riverwood case and
Riverwood therefore controls the removal/remand decision in this case. According to
Plaintiffs, Riverwood implicitly rejected the very refinery argument that the Removing
Defendants are making now, and this case should be remanded to state court without

11

The Court notes that very recently Judge Eldon E. Fallon of this district remanded two of
his SLCRMA cases, Civil Actions 18-5206 and 18-5242. After explaining that he had kept
his SLCRMA cases stayed based on the understanding that the outcome in Riverwood
would be determinative of federal jurisdiction in all of the other SLCRMA cases in this
district, Judge Fallon proceeded to address and reject the removing defendants’ new federal
officer removal theory based on a World War II era refinery contract. Parish of Jefferson v.
Destin Oper. Co., No. 18-5206, 2023 WL 2772023 (E.D. La. Apr. 4, 2023); Parish of
Jefferson v. Equitable Petrol. Corp., No. 18-5242, 2023 WL 2771705 (E.D. La. Apr. 4,
2023). So Judge Fallon has already rejected the same argument that is before the Court in
the instant motion to remand. The Court agrees wholeheartedly with Judge Fallon’s
reasoning.
Page 9 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 10 of 25

further delay.
According to the Removing Defendants, Plaquemines II, albeit in dicta, actually
outlined the specific facts that would give rise to federal officer removal when World War
II era activities are present, and this particular case presents the very scenario that the
Fifth Circuit was referring to when distinguishing a non-removable case like Riverwood
from a removable case like this one. To the point, this case involves a World War II era
refinery contract unlike those relied upon in Riverwood, that satisfies the “acting under”
requirement for federal officer removal where Riverwood failed. Therefore, so say the
Removing Defendants, Riverwood does not control the remand decision here, this case
satisfies all of the requirements for federal officer removal, and the plaintiffs’ motion to
remand should be denied.
The Court will not dwell on the reasons that it was persuaded that Riverwood
would provide all of the answers necessary to adjudicate the propriety of removal in all
of the other SLCRMA cases, including this one,12 or that the defendants have used
Plaquemines II as a guide to craft a new removal theory that navigates around the
jurisdictional obstacles of Riverwood. The Court likewise will not dwell on the question of
whether the ultimate rejection of federal officer removal in Riverwood by Plaquemines II
applies with equal force to all of the remaining SLCRMA cases. Rather, the Court
begins it analysis with Riverwood but proceeds to address the merits of the Removing
Defendants’ new theory for federal officer removal.

12

Judge Fallon alluded to this in his reasons when granting the motions to remand filed in
his cases. Those motions were granted, however, on the merits of the defendants’ new
theory of federal officer removal. See note 11 above.
Page 10 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 11 of 25

The Court will assume the reader’s familiarity with Judge Feldman’s rulings in
Riverwood, and the Fifth Circuit’s Plaquemines I and Plaquemines II decisions.13 But in
order to understand the specific removal argument that the Removing Defendants are
making in this case and why they believe that this case succeeds where Riverwood
failed, and to provide context for the dicta in Plaquemines II, a short synopsis of
Riverwood’s theory of federal officer removal jurisdiction, and the reasons that it was
rejected, is helpful.
As a reminder, the federal officer removal statute allows for “any officer (or any
person acting under that officer) of the United States or of an agency thereof . . . for or
relating to any act under color of such office . . .” to remove to federal court a civil
action commenced in state court against him.” 28 U.S.C. § 1442(a)(1) (emphasis
added). Under this statute, the removing defendant has the burden of showing that 1) it
has asserted a colorable federal defense, 2) it is a “person” within the meaning of the
statute, 3) it has acted pursuant to a federal officer’s (or agency’s) directions, and 4) the
charged conduct is connected or associated with an act pursuant to a federal officer’s
directions. Plaquemines II, 2022 WL 9914869, at *2 (citing Box v. PetroTel, Inc., 33
F.4th 195, 199 (5th Cir. 2022)).
The first two prongs of the test were not problematic for the removing defendants
in Riverwood; the third prong, often referred to as the “acting under” prong, presented

13

For clarity, the Court points out that at times it refers to Riverwood when in context the
Court is actually referring generally to some aspect of the Fifth Circuit’s Plaquemines I and
Plaquemines II decisions. The Court will at times refer specifically to Plaquemines I and
Plaquemines II for points specific to one or the other of those opinions.
Page 11 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 12 of 25

the stumbling block. The Plaquemines II panel declined to reach the fourth prong for
federal officer removal since it was a moot point.
The removing defendants in Riverwood were not officers of the United States or
of any agency of the United States—they were private corporate parties being sued for
their oil producing activities in the coastal parishes of Louisiana. As private parties, the
removing defendants could only remove under § 1442(a)(1) if they could establish that
they had “acted under” an officer or agency of the United States when they engaged in
the oil producing activities being challenged in the plaintiffs’ lawsuit.
While a private party’s contract with the federal government does not guarantee
satisfaction of “acting under,” it certainly goes a long way when trying to establish that
requirement for federal officer removal.14 Of course the specific activities being
challenged in Riverwood (as in this case and all of the SLCRMA cases) were oil
production activities and no defendant in Riverwood (or any SLCRMA case including
this one) had a contract with the federal government for oil production at any time, much
less during the World War II era. The removing defendants in Riverwood therefore
crafted several theories as to why they had “acted under” a federal officer when
engaging in World War II era oil producing activities, theories which were based in large
part on the federal government’s extensive regulation and oversight of the oil industry
during World War II. The removing defendants were convinced that the extensive

14

See, e.g., St. Charles Surgical Hospital, LLC v. Louisiana Health Service & Indemnity
Co., 935F.3d 352, 356 (5th Cir. 2019) (examining the terms of the contract at issue to
search for the requisite level of guidance and control over the private party before
concluding that the private party’s contract with a federal agency satisfied the acting under
prong).
Page 12 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 13 of 25

government regulation and oversight that they operated under during World War II
elevated them to the level of federal contractors, even in the absence of an actual
contract. That theory was rejected both by Judge Feldman and by the Fifth Circuit
because Supreme Court precedent foreclosed the suggestion that a person could be
acting under a federal officer when operating in an industry regulated by the federal
government, regardless of how extensive that regulatory scheme might be. See Watson
v. Philip Morris Cos., 551 U.S. 142 (2007) (addressing and rejecting federal officer
removal by a cigarette manufacturer). Complying with extensive federal regulations
neither created a “special relationship” with the government nor rose to the level of
acting under the federal government’s direction for purposes of federal officer removal
jurisdiction.
The removing defendants also argued in Riverwood that at the very least they
should be treated as federal subcontractors because even though they had no contracts
of their of their own with the federal government for oil production, they did have
contracts with refineries who had contracts with the federal government to deliver fuel to
be used in the war effort. But the panel rejected that argument in Plaquemines II
because the removing defendants had not shown that they were subjected to the
federal government’s guidance or control as subcontractors. 2022 WL 9914869, at *4.
Afterall, the removing defendants in Riverwood were oil producers not oil refiners and
they could not satisfy the “acting under” prong by piggy-backing on federal contracts to
which they were not parties, at least not in the absence of demonstrating the necessary

Page 13 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 14 of 25

federal guidance or control.15
It was in response to the removing defendants’ subcontractor argument, which
was grounded on a refinery contract, that the Fifth Circuit quoted in dicta a sentence
from Judge Feldman’s opinion on remand that has become the basis of the new federal
officer removal argument: “As the district court noted, the ‘refineries, who had federal
contracts and acted pursuant to those contracts, can likely remove [under § 1442], but
that does not extend to [parties] not under that contractual direction.” Plaquemines II,
2022 WL 9914869, at *4 (quoting Plaquemines, 2022 WL 101401) (emphasis added).
This single sentence observation has helped embolden the Removing Defendants in
trying to distinguish the remaining SLCRMA cases from Riverwood.
Although all of the Riverwood defendants were sued for oil production activities
(not refining activities), at least one of those defendants, Humble Oil (predecessor to
Exxon Mobil), had been an oil producer and a refiner during World War II. Humble Oil
had not only operated the Potash Field, which was part of the Operational Area in
Riverwood, but its refinery had also supplied aviation fuel to the government during
World War II pursuant to a federal contract. For reasons not explained in Riverwood,
Exxon did not rely on that contract when arguing in favor of federal officer removal,

15

Note, not being a named party to a federal contract is not fatal to establishing that a
private party was “acting under” a federal officer so long as the contract being relied upon
imposes the required level of supervision and control over the party relying on that contract
for federal officer removal. See Cloyd v. KBR, Inc., No. 21-20676, 2022 WL 4104029, at *3
(5th Cir. Sept. 8, 2022) (not published); Trinity Home Dialysis, Inc. v. Wellmed Networks,
Inc., No. 22-10414, 2023 WL 2573914, at *3 (5th Cir. Mar. 20, 2023) (not published). In
Riverwood none of the refinery contracts relied upon demonstrated any level of supervision
or control vis à vis the removing defendants and this was fatal to their position.
Page 14 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 15 of 25

Riverwood, 2022 WL 101401, at *7 n.14 (noting that Humble Oil was not relying on its
own refinery contract in support of its “acting under” argument), instead relying on the
federal contracts of the refineries that Humble had supplied with the Potash Field crude.
In other words, in Riverwood none of the Potash Field crude production, which was the
basis of the plaintiffs’ allegations in the case, was actually sent to Humble’s refinery to
perform under its own federal contract.16
Obviously, the removing defendants in Riverwood were not blind to the potential
for federal officer removal based on World War II era refinery contracts with the federal
government because they tried mightily to use them to their advantage. Riverwood
expressly rejected the notion that an oil producer defendant that sent its Operational
Area crude to another company (including an affiliate company) for refining under a
federal contract “acts under” a federal officer for purposes of removal. It bears repeating
that the problem with the refinery contracts in Riverwood was not the defendants’ lack of
privity with the federal government but rather that the refinery contracts presented in
Riverwood did not impose the necessary level of federal guidance or control over the oil
producer defendants who wanted to rely on those contracts for federal officer removal.
The scenario presented in the instant case involves removal by a World War II
era oil producer defendant that, like Humble Oil in Riverwood, also happened to have a
federal refinery contract during World War II but who did refine some of its Operational
Area crude in performing under that federal contract. The Removing Defendants point

16

According to Plaintiffs, the Potash Field crude was sent to a Humble affiliate for refining.
Page 15 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 16 of 25

out that in the instant case Gulf Oil Corp., a predecessor to removing defendant
Chevron U.S.A., Inc., was acting as both a refiner who provided refined petroleum
products to the government pursuant to a contract, and as a producer of crude oil in the
Operational Area of this case. Whereas in Riverwood no individual corporate defendant
produced the crude that it refined pursuant to a federal contract, the Removing
Defendants point out that Gulf Oil produced oil from the Operational Area in this case
and transported it to its own refinery, who then performing under its wartime government
contract, used that same crude to produce aviation fuel for the government. The
Removing Defendants contend that such a defendant would satisfy the “acting under”
prong of federal officer removal, the prong where Riverwood failed, rendering removal to
federal court proper.
As the Court explains below, the refinery contract in this case is no different than
the refinery contracts relied upon in Riverwood because it imposed no federal
supervision or control whatsoever over Gulf Oil’s oil production activities. One aspect of
Riverwood that does cut across all of the SLCRMA cases is that the defendants cannot
show that any one of them acted under a federal officer when engaging in oil production
activities during World War II. So crucially, the Removing Defendants have altered their
“acting under” argument by abandoning any effort to establish that any defendant acted
under a federal officer when engaging in oil production activities, which is what this
lawsuit and all of the SLCRMA lawsuits are about. The Removing Defendants now
contend that the more relaxed post-Latiolais connection test relieves them of that
burden under the facts of this case. Whereas in Riverwood the defendants struggled

Page 16 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 17 of 25

and failed to prove that they had acted under a federal officer when engaging in oil
production activities, the Removing Defendants’ new theory is that defendant Gulf Oil
acted under a federal officer when refining aviation fuel during World War II pursuant to
a federal supply contract. Then since Gulf sent some of the Operational Area’s crude to
its refinery to use when performing under the federal contract, Gulf’s crude oil
production activities, including the activities being challenged in this lawsuit, are related
to the performance under the refinery contract, thereby making the case removable.
III.
The Court now turns to the Motion to Remand filed in this action and to the merits
of the Removing Defendants’ current argument in support of federal officer removal for
this case.
The Removing Defendants’ argument in support of federal officer removal in this
case is based on the wartime activities of Gulf Oil Corp., a predecessor to defendant
Chevron U.S.A., Inc., who is one of the Removing Defendants.17 During World War II,
Gulf was an integrated oil company having both “upstream” oil production operations
such as those being challenged in the Operational Area delineated in this lawsuit, and
“downstream” operations such as the refining of crude oil into gasoline, fuel, and other
petroleum products. No one would dispute that crude oil is the primary component that a
refinery uses to produce fuel and that was certainly the case in the 1940s. But upstream

17

So long as a single claim satisfies the federal officer removal statute, the entire case may
be removed. Savoie v. Huntington Ingalls, Inc., 817 F.3d 457, 463 (5th Cir. 2016) (citing
14C Charles Alan Wright & Arthur R. Miller, Federal Practice And Procedure § 3726 (4th
ed.2015)), overruled on other grounds, Latiolais, 951 F.3d at 296 n.9.
Page 17 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 18 of 25

oil producing operations in the field and downstream refining operations at the plant are
“two entirely separate operations requiring different skills, and different operations at
different locations.” Destin Oper. Co., 2023 WL 2772023, at *3) (Fallon, J.); Equitable
Petrol. Corp., 2023 WL 2771705, at *3 (Fallon, J.). The separate functions may be
performed by different companies or a larger company may do both, as Gulf Oil was
doing during World War II.
The Removing Defendants have produced a contract dated August 10, 1942,
between Gulf Oil Corporation and Defense Supplies Corporation, a federal entity.18
(Rec. Doc. 63-2 at 90). The contract is a sales or supply agreement for Gulf to refine for
and sell to the government 100-octane aviation gasoline to be produced at its refinery
located in Port Arthur, Texas. The agreement is more than just a refining/supply
agreement because Gulf agreed to expand its Port Arthur, Texas facility in order to
increase its production capacity for aviation gas for the government. In return, the
government agreed to pay Gulf millions of dollars upfront toward the expansion of the
privately-owned facility. The contract does not mention crude oil production.
The Court will assume that in light of the federal contract, Gulf was acting under a
federal officer to produce military petroleum products at its refinery in Port Arthur, Texas
during World War II.19

According to the Removing Defendants’ expert, the Defense Supplies Corporation
(“DSC”) was a government corporation organized in August 1940 as a subsidiary of the
Reconstruction Finance Corporation to finance plant expansion and purchase 100-octane
aviation gasoline. (Rec. Doc. 63-1, Declaration of Alfred M. (“A.J.”) Gravel at 11 n.7).
18

19

The plaintiffs dispute that the Gulf Oil refining contract contains the requisite level of
supervision and control necessary to satisfy the acting under prong. See note 14 above.
Page 18 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 19 of 25

Next, in the interest of resolving any factual disputes in favor of maintaining
federal jurisdiction,20 the Court will assume that in 1942, on a regular basis, Gulf
extracted oil from the Operational Area at issue in this lawsuit, and transported that
crude to its Port Arthur refinery, where it was used to make aviation fuel for the
government under the contract. The Removing Defendants’ expert’s report refers only to
a March 1942 delivery of crude from West Bay Field to the Port Arthur refinery, (Rec.
Doc. 63-1, Gravel declaration ¶ 148), which predates the federal contract but the Court
will not belabor this point. Also, the Court will assume that production was ramped up in
the Operational Area during World War II at least in part for the purpose of making
aviation fuel in Port Arthur, Texas in accordance with the federal contract.
Having made the foregoing legal and factual assumptions in favor of the
Removing Defendants, one need only follow the crude as it traveled from the
Operational Area of the Louisiana coast to the refinery in Port Arthur, Texas, to
conclude that the World War II era oil production operations in West Bay field are
connected to Gulf’s aviation gas refining in Port Arthur, the latter being conducted
pursuant to a federal contract. Recognizing, as the Removing Defendants do, that crude
oil production, much less the operations being challenged in this case, were not under
federal direction, the final piece of the federal officer removal puzzle turns on a legal

20

Though generally remand to state court is favored when removal jurisdiction is
questionable, removal jurisdiction under the federal officer removal statute must be broadly
construed resolving any factual disputes in favor of federal jurisdiction. Joseph v. Fluor
Corp., 513 F. Supp. 2d 664, 671 (E.D. La. 2007) (Fallon, J.) (citing Willingham v. Morgan,
395 U.S. 402, 407 (1969); Louisiana v. Sparks, 978 F.2d 226 (5th Cir.1992)). Unlike other
removal statutes, the analysis proceeds “without a thumb on the remand side of the scale.”
Trinity Home Dialysis, 2023 WL 2573914, at *2 (citing Latiolais, 951 F.3d at 290).
Page 19 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 20 of 25

question—can the related to prong of federal officer removal as broadened in Latiolais
be used to relieve the Removing Defendants of having to show—which they cannot
do—that a federal officer directed Gulf’s oil production activities. Or put another way,
can the Removing Defendants satisfy the acting under prong by relying on federal
directives governing conduct (refining) that is not implicated by the plaintiffs’ lawsuit.
In Latiolais the en banc Fifth Circuit recognized that federal officer removal is not
just for acts under a federal officer but also for those “relating to,” or connected or
associated with those federal acts. Latiolais, 951 F.3d at 296. So for instance, in
Latiolais a ship builder who had refurbished a navy vessel pursuant to a government
contract that required asbestos was allowed to remove the plaintiff’s suit grounded on
the defendant’s negligence in failing to warn him about the hazards of asbestos and to
provide adequate safety equipment—conduct that was not dictated by the government
contract and therefore was not taken pursuant to a federal officer’s directions. Removal
was allowed because it was not necessary to show that any specific government
directive was the moving force of (caused) the negligence being sued upon. It was
enough that the plaintiff’s negligence claims were related to a federal directive to use
asbestos in the refurbishing of the vessel.
The Removing Defendants’ position is that just like the defendant in Latiolais
could remove without showing that the complained-of conduct (failure to warn and
failure to provide safety equipment) occurred at the behest of federal officers, they do
not have to show that their oil production activities occurred at the behest of federal
officers. It is enough, say the Removing Defendants, that Gulf’s oil production activities

Page 20 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 21 of 25

are related to its activities as a refiner acting under a federal officer, and that both of
these sets of activities came together in an integrated corporate entity. And the
Removing Defendants contend that to hold them to any other standard would be to
improperly conflate the “acting under” and “for or relating to” elements of the test in a
way that simply reimposes the causal nexus requirement that the Fifth Circuit jettisoned
in Latiolais.
To be sure, the Removing Defendants’ latest argument in support of federal
officer removal is creative and does have a superficial appeal to it. But the Court is
persuaded that the argument fails because this case satisfies neither the acting under
requirement nor the related to requirement for federal officer removal. The acting under
and related to requirements for federal officer removal are distinct and both must be
satisfied. St. Charles Surgical Hosp., L.L.C. v. Louisiana Health Serv. & Indem. Co., 990
F.3d 447, 454 (5th Cir. 2021). The Removing Defendants cannot use the separate
“related to” prong to circumvent the requirements of the distinct “acting under” prong
when the federal contract that they are relying upon contains no federal directives
whatsoever—none—related to the plaintiffs’ allegations in this lawsuit.
While Latiolais abandoned the stringent causal nexus test to recognize that the
specific conduct being challenged need not have been directed by a federal officer, it
nonetheless tethered its analysis to the specific federal directive that the plaintiff’s
claims were related to, i.e., the directive to use asbestos in the refurbishment of a navy
vessel. The defendant was acting under a federal officer when refurbishing the vessel
for the navy, and in particular when using asbestos in the project, but it would no longer

Page 21 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 22 of 25

be necessary after Latiolais to show that any specific government directive was the
cause of the negligence being sued upon. So while post-Latiolais the reach of the
related to prong brings conduct not specifically directed by a federal officer into the
scope of removal, the conduct must relate nonetheless to carrying out the directives of a
federal officer. This is not the same as saying that a federal officer must have directed
the specific conduct being challenged.
This case lacks any connection between crude oil production activities and the
directives of a federal officer as dictated by the federal contract. The Removing
Defendants have attempted to elide past that problem by defining the federal directive
as broadly as possible, i.e., produce military petroleum products at the refinery in Port
Arthur, Texas, and then creating a factual connection between oil production in
Louisiana to federal activity at the refinery. But every case that the Court has reviewed,
including the post-Latiolais decisions, that grounds federal officer removal on
relatedness to a federal contract, examines the directives of that contract when
determining whether all of the requirements for federal officer removal are met, and in
particular whether the plaintiff’s claims relate to the directives of a federal officer.
But in this case the Removing Defendants fail to point to a single directive in the
Gulf contract that touched upon its upstream oil production activities in Louisiana or
anywhere else for that matter. No directive in the contract has anything to do with
upstream oil production. In fact, the contract does not mention where the Port Arthur
refinery was to get the large amounts of crude oil that would be necessary to feed the
refinery although part (d) of the Price Escalation section does allude to the possibility

Page 22 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 23 of 25

that Gulf may at times purchase refining components from other suppliers. (Rec. Doc.
63-2at 9). The contract is simply not concerned with where or how Gulf would obtain the
crude oil necessary to produce the fuel that was to be sold to the government at the Port
Arthur refinery. While anyone can infer that performance under the contract would
require a lot of crude, the contract is utterly silent as where the crude oil was to come
from. The contract did not direct, require, or even suggest that Gulf produce its own
crude in order to meet its contractual obligations.
So, in no way did the government direct Gulf to produce its own crude, and in no
way did Gulf agree to do that as part of the agreement. The agreement does not even
allude to the possibility of Gulf producing its own crude to fulfill the contract. The
contract does not concern itself with adequate crude supplies, or assurances of ramped
up production. No direction or hint is given in that area. Gulf could have sourced the
crude from anywhere based on economics, and Gulf obviously left its options open on
that front without committing itself. Gulf had complete latitude under the contract to
forego producing any crude and instead to buy it on the open market.
In St. Charles Surgical Hosp., L.L.C. v. Louisiana Health Serv. & Indem. Co., 990
F.3d 447, 455 (5th Cir. 2021), the Fifth Circuit recognized that a defendant may be
acting under the government pursuant to a contract—like Gulf was in 1942—but it is
possible that the alleged conduct underlying the plaintiffs’ claims is not connected or
associated with (or related to) any federal directive from the government. In other words,
a defendant that acts under the government for some purposes does not necessarily act
under the government “for all purposes.” Id.

Page 23 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 24 of 25

In this case, Gulf Oil may have acted under a federal officer when refining oil in
Port Arthur, Texas but it did not act under a federal officer when producing that oil in
Louisiana. And because the Gulf refinery contract only contains directives pertaining to
refining, there is no federal directive in the contract to tether Gulf’s oil production
activities to, including the specific oil production activities at issue in this lawsuit. And
Gulf Oil’s integrated corporate structure does not change the analysis because just as in
Riverwood, the problem is not necessarily one of privity but rather that the refinery
contracts contain no federal control and supervision as to oil production activities. As
such, even if the Removing Defendants have satisfied the acting under requirement for
“some purpose” like refining they cannot relate the plaintiffs’ allegations to any federal
directive present in this case. As Judge Fallon noted when remanding his similarly
situated SLCRMA cases, under the defendants’ theory a company with a single federal
contract could remove essentially any claim for activities outside the scope of the
contract but arguably connected to it, which may mean virtually anything.
Finally, the dicta in Plaquemines II that the Removing Defendants rely upon does
not support their new theory for federal officer removal and it is a far cry from
demonstrating that the Fifth Circuit believed that an oil producer who acted as both a
producer and a refiner pursuant to a federal contract could remove so long as it refined
some of the crude from the Operational Area in that case. The defendants read much
into a single unremarkable statement that refineries with their own federal contracts
would “likely” be able to remove. But the Fifth Circuit would not have been suggesting
that refineries could remove for claims based on oil production activities because

Page 24 of 25

Case 2:18-cv-05228-JCZ-DPC Document 80 Filed 04/18/23 Page 25 of 25

refineries do not produce crude and they do not engage in oil producing activities like
those being challenged in this lawsuit. Common sense would dictate that what the
appellate court meant was that the refineries whose federal contracts the Riverwood
defendants were trying to latch onto could satisfy the acting under requirement and
remove if they had been sued for activities taken pursuant to the federal directives in
their refinery contracts, i.e., refining activities. The Removing Defendants’ reliance on
the Fifth Circuit’s dicta in Plaquemines II is misplaced.
In sum, even beyond the holdings of Riverwood, Plaquemines I, and
Plaquemines II, the Court is persuaded that the Removing Defendants’ current refinerycontract-based argument lacks merit, that federal officer removal jurisdiction does not
apply to this case, and that the plaintiffs’ motion to remand must be granted.
Accordingly and for the foregoing reasons;
IT IS ORDERED that the Motion to Remand (Rec. Doc. 62) filed jointly by the
plaintiff, the Parish of Plaquemines, and the plaintiff-intervenors the State of Louisiana,
through the Louisiana Department of Natural Resources, Office of Coastal
Management, and its Secretary, Thomas F. Harris, and the State of Louisiana ex rel.
Jeff Landry, Attorney General is GRANTED. This matter is REMANDED to the state
court from which it was removed.
April 18, 2023

_______________________________
JAY C. ZAINEY
UNITED STATES DISTRICT JUDGE

Page 25 of 25