State of Minnesota v. American Petroleum Institute et al
Filing
76
MEMORANDUM OPINION AND ORDER granting 32 Motion to Remand to State Court and denying 56 Motion to Stay. (Written Opinion) Signed by Chief Judge John R. Tunheim on 3/31/2021. (HMA)
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UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
STATE OF MINNESOTA, by its Attorney
General Keith Ellison
Civil No. 20-1636 (JRT/HB)
Plaintiff,
v.
AMERICAN PETROLEUM INSTITUTE,
EXXON MOBIL CORPORATION,
EXXONMOBIL OIL CORPORATION, KOCH
INDUSTRIES, INC., FLINT HILLS
RESOURCES, LP, and FLINT HILLS
RESOURCES PINE BEND
MEMORANDUM OPINION
AND ORDER GRANTING MOTION TO
REMAND AND DENYING MOTION TO
STAY
Defendants.
Elizabeth C. Kramer, Leigh K. Currie, Oliver J. Larson, and Peter N. Surdo,
OFFICE OF THE MINNESOTA ATTORNEY GENERAL, 445 Minnesota Street,
Suite 1100, St. Paul, MN 55101; Matthew Kendall Edling and Victor Marc
Sher, SHER EDLING LLP, 100 Montgomery Street, Suite 1410, San Francisco,
CA 94104, for plaintiff.
Eric F. Swanson and Thomas H. Boyd, WINTHROP & WEINSTINE PA, 225
South Sixth Street, Suite 3500, Minneapolis, MN 55402; Andrew Gerald
McBride, MCGUIRE WOODS LLP, 2001 K Street Northwest, Suite 400,
Washington, DC 20006; and Brian David Schmalzbach, MCGUIRE WOODS
LLP, 800 East Canal Street, Richmond, VA 23219, for defendant American
Petroleum Institute.
Jerry W. Blackwell and Gurdip S. Atwal, BLACKWELL BURKE PA, 431 South
Seventh Street, Suite 2500, Minneapolis, MN 55415; Daniel J. Toal and
Theodore V. Wells, Jr., PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP,
1285 Avenue of the Americas, New York, NY 10019; Justin Anderson, PAUL,
WEISS, RIFKIND, WHARTON & GARRISON LLP, 2001 K Street Northwest,
Washington, DC 20006; and Patrick J. Conlon, EXXON MOBIL
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CORPORATION, 22777 Springwoods Village Parkway, Suite N1.4B.388,
Spring, TX 77389, for defendants Exxon Mobil Corporation and ExxonMobil
Oil Corporation.
Michelle Schmit and Stephen Andrew Swedlow, QUINN EMANUEL
URQUHART & SULLIVAN LLP, 191 North Wacker Drive, Suite 2700, Chicago,
IL 60606; William Anthony Burck, QUINN EMANUEL URQUHART &
SULLIVAN LLP, 1300 I Street Northwest, Suite 900, Washington, DC 20005;
Andrew M. Luger, JONES DAY, 90 South Seventh Street, Suite 4950,
Minneapolis, MN 55402; Debra Rose Belott, JONES DAY, 51 Louisiana
Avenue Northwest, Washington, DC 20001; and Andrew W. Davis, Peter J.
Schwingler, and Todd A. Noteboom, STINSON LLP, 50 South Sixth Street,
Suite 2600, Minneapolis, MN 55402, for defendants Koch Industries, Inc.,
Flint Hills Resources, LP, and Flint Hills Resources Pine Bend.
Plaintiff State of Minnesota (“the State”) commenced this action in Minnesota
state court against Defendants American Petroleum Institute (“API”), Exxon Mobil
Corporation, ExxonMobil Oil Corporation, Koch Industries, Inc., Flint Hills Resources LP,
and Flint Hills Resources Pine Bend asserting five causes of action for violations of
Minnesota common law and consumer protection statutes. The State alleges that
Defendants developed a widespread campaign to deceive the public about the dangers
of fossil fuels and to undermine the scientific consensus linking fossil fuel emissions to
climate change.
Defendants removed the action to federal court on seven independent grounds:
federal common law; disputed and substantial federal issues (the Grable doctrine); the
federal officer removal statute; the Outer Continental Shelf Lands Act; federal enclaves;
the Class Action Fairness Act; and diversity. Plaintiff filed a Motion to Remand to state
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court. Because Defendants have not met their burden of establishing that federal
jurisdiction is warranted on any of the grounds presented, the Court will grant the State’s
Motion.
Defendants Koch Industries, Inc., Flint Hills Resources LP, and Flint Hills Resources
Pine Bend (collectively, “FHR Defendants”) have also filed a Motion to Stay to await the
Supreme Court’s decision in BP p.l.c. v. Mayor & City Council of Baltimore, No. 19-1189
(U.S.) and the Court’s determination on a Petition for Certiorari in Chevron Corporation et
al. v. City of Oakland, et al. (U.S., Jan. 8, 2021). Plaintiff opposes this motion. Because
the Court finds that the Baltimore case is before the Supreme Court on a narrow
procedural question not at issue here and the dispensation of the petition in City of
Oakland is too speculative to warrant a stay in the instant proceedings, the Court will
deny FHR Defendants’ Motion to Stay.
BACKGROUND
I.
FACTUAL BACKGROUND
The Attorney General brings this action pursuant to his authority under Minnesota
Statutes Chapter 8 and his parens patriae authority under state common law. (Notice of
Removal, Ex. A (“Compl.”) ¶ 12, July 27, 2020, Docket No. 1-1.)
Defendant American Petroleum Institute (API) is a nonprofit corporation
registered to do business in Minnesota. (Id. ¶ 13.) API was established in 1919 and is the
country’s largest oil trade association, with over 600 members. (Id.) Defendant Exxon
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Mobil Corporation is a multinational, vertically integrated energy and chemicals company
incorporated in New Jersey with a principal place of business in Irving, Texas. (Id. ¶ 17.)
Exxon Mobil Corporation is the parent company for numerous subsidiaries and has done
business as or is the successor in liability to numerous entities. (Id.)
Defendant
ExxonMobil Oil Corporation is a wholly owned subsidiary of Exxon Mobil Corporation,
incorporated in New York with a principal place of business in Irving, Texas. (Id. ¶ 19.)
Defendant Koch Industries, Inc. (“Koch”) is an American multinational corporation based
in Wichita, Kansas. (Id. ¶ 28.) Koch is the parent company for numerous subsidiaries
involved in the manufacturing, refining, and distribution of petroleum products. (Id. ¶
29.) Koch, as well as many of its subsidiaries and affiliates, is registered to do business in
Minnesota. (Id. ¶ 31.)
Defendants Flint Hills Resources LP and Flint Hills Resources Pine Bend, LLC,
subsidiaries of Koch, are licensed distributors of petroleum products in Minnesota. (Id.)
Koch subsidiaries import crude oil from Canada to a terminal in Clearbrook, Minnesota,
which is owned and operated by Koch. (Id. ¶ 32.) Oil is piped from the Clearbrook
terminal to the Flint Hills Resources Pine Bend Refinery via other Koch-owned pipelines.
(Id.) Flint Hills Resources’ Pine Bend Refinery refines the majority of the motor gasoline
consumed in Minnesota. (Id. ¶ 37.)
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A. Climate Change & Fossil Fuels
Beginning in the 1950s, scientists—including many employed by the fossil fuel
industry—began to understand that burning fossil fuels released additional greenhouse
gasses, drove up atmospheric concentration, changed the carbon ratio in the
atmosphere, and impacted global temperature and climate. (Id. ¶¶ 55–59.) The State
alleges that by 1965, Defendants and their predecessors-in-interest were aware that
widely used fossil-fuel products would cause global warming by the end of the century
and would have wide-ranging and costly consequences. (Id. ¶ 60.)
The State alleges that Defendants were at the forefront of scientific discourse
about climate change and its relationship to fossil fuels, and were privy to research
developed by industry-employed scientists as well as independent analyses, including
research commissioned by Defendants and their colleagues. (Id. ¶¶ 60–72.) By the
1980s, there was an established consensus among scientists and within the fossil fuel
industry that atmospheric CO2 concentrations were reaching dangerous levels and would
significantly impact the earth’s climate, and international coalitions had begun to emerge
to address the issue. (Id. ¶ 73.)
B. Defendants’ Alleged Misinformation Campaign
The State alleges that, as the international and scientific consensus coalesced
around the relationship between fossil fuels emissions and climate change, Defendants
mounted an aggressive campaign to undermine the public’s perception of climate
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science. (Id. ¶¶ 82–87.) Defendants allegedly spent millions of dollars on advertising and
public relations campaigns, in Minnesota and elsewhere, to mislead consumers and the
general public about the scientific consensus around climate change, the relationship
between climate change and their fossil-fuel products, and the urgency of the dangers of
climate change. (Id. ¶¶ 88–90). The State further alleges that Defendants funneled
hundreds of millions more dollars to organizations that publicly promoted false
statements about and denied the existence of climate change, and paid scientists to
produce misleading reports and materials, which Defendants’ then cited and promoted
to support their own fraudulent statements. (Id. ¶¶ 92–131.)
The State identifies two broad categories of alleged injuries caused by Defendants’
misinformation campaign: (1) harms to consumers who relied on Defendants’ false
information, (id. ¶¶ 172–83); and (2) environmental and social harms from increased
consumption of fossil fuels, including changes in climate, damage to infrastructure, and
worsening public health, (id. ¶¶ 139–71), all of which, the State avers, could have been
mitigated, but for Defendants’ campaign, (id. ¶¶ 172, 213–14).
II.
PROCEDURAL HISTORY
Plaintiff commenced this action in Minnesota state court asserting five counts
related to Defendants’ alleged misinformation campaign: (1) violations of the Minnesota
Consumer Fraud Act (“CFA”), Minnesota Statutes § 325F.69; (2) failure to warn under
common law theories of strict liability and negligence, against all Defendants except API;
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(3) common law fraud and misrepresentation; (4) violations of the Minnesota Deceptive
Trade Practices Act (“DTPA”),Minnesota Statutes § 325D.44; and (5) violations of the
Minnesota False Statement in Advertising Act (“FSAA”),Minnesota Statutes § 325F.67.
(Id. ¶¶ 184–242.) The State seeks damages, civil penalties, disgorgement of profits made
as a result of unlawful conduct, and an order enjoining Defendants from continued
violations of the CFA, DTPA, and FSAA. (Id. ¶¶ 244, 247–249.). The State also requests
that Defendants be compelled to disclose, disseminate, and publish all research that they
conducted directly or indirectly relating to climate change, and fund a corrective climate
change public education campaign in Minnesota, administered and controlled by an
independent third party. (Id. ¶¶ 245–246).
On July 27, 2020, Defendants removed the action to federal court. (Notice of
Removal, July 27, 2020, Docket No. 1.) Defendants raise seven grounds for asserting
federal jurisdiction over this matter: (1) the claims arise under federal, not state, common
law; (2) the action raises disputed and substantial federal issues that must be adjudicated
in a federal forum (the “Grable doctrine”); (3) removal is authorized by the federal officer
removal statute, 28 U.S.C. § 1442(a)(1); (4) federal jurisdiction arises under the Outer
Continental Shelf Lands Act (“OCSLA”), 43 U.S.C. § 1349(b); (5) the claims are based on
conduct arising out of federal enclaves; (6) the action is actually a class action governed
by the Class Action Fairness Act (“CAFA”), 28 U.S.C. § 1332(d), 28 U.S.C. § 1453(b); and (7)
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the court has diversity jurisdiction under 28 U.S.C. § 1332(a), on the theory that the real
parties in interest are not the State, but the citizens of Minnesota.
On August 26, 2020, Minnesota moved to remand the case to state court, arguing
that the Court lacks subject matter jurisdiction because (a) neither federal common law
nor the Grable doctrine apply; (b) no federal enclaves are implicated; (c) the Outer
Continental Shelf Lands Act is not implicated; (d) the federal officer removal statute does
not apply; (e) the suit is not a “class action” and therefore not subject to the Class Action
Fairness Act; and (f) the suit was brought by the State, which is not a citizen for purposes
of diversity jurisdiction. (Mot. Remand, Aug. 26, 2020, Docket No. 32.) Defendants
oppose this Motion.
The FHR Defendants filed a Motion to Stay, on January 15, 2021, arguing that
staying proceedings until the Supreme Court issues a decision in BP p.l.c. v. Mayor & City
Council of Baltimore, and makes a determination on the Petition for Certiorari in Chevron
Corporation v. City of Oakland, et al., would conserve judicial resources and would not
prejudice the State. (Mot. Stay, Jan. 15, 2021, Docket No. 56.) The State opposes staying
the Motion to Remand.
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DISCUSSION
I.
MOTION TO REMAND
A.
Standard of Review
“Federal courts are courts of limited jurisdiction, possessing only that power
authorized by Constitution and statute.” Gunn v. Minton, 568 U.S. 251, 256 (2013)
(quotation omitted). A defendant may remove a civil action to federal court only if the
action could have been filed originally in federal court. See 28 U.S.C. § 1441(a)–(b); Gore
v. Trans World Airlines, 210 F.3d 944, 948 (8th Cir. 2000). The party seeking removal bears
the burden of demonstrating that removal was proper, and “all doubts about federal
jurisdiction must be resolved in favor of remand.” Cent. Iowa Power Co-op. v. Midwest
Indep. Transmission Sys. Operator, Inc., 561 F.3d 904, 912 (8th Cir. 2009). Remand is
mandatory “at any time before final judgment [if] it appears that the district court lacks
subject matter jurisdiction.” 28 U.S.C. § 1447(c).
C. The Well-Pleaded Complaint Rule
“[F]ederal jurisdiction exists only when a federal question is presented on the face
of the plaintiff's properly pleaded complaint. The rule makes the plaintiff the master of
the claim; he or she may avoid federal jurisdiction by exclusive reliance on state law.”
Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987) (citation omitted). Where a
complaint pleads only state law claims, a federal court does not have jurisdiction based
on a federal defense. See, e.g., Aetna Health Inc. v. Davila, 542 U.S. 200, 207 (2004).
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There are two relevant exceptions to the well-pleaded complaint rule. First,
“[w]hen a plaintiff has artfully pleaded in a manner that avoids an element of the tort that
rests on federal law, the court ‘may uphold removal even though no federal question
appears on the face of plaintiff’s complaint.’” Gore, 210 F.3d at 950 (quoting Rivet v.
Regions Bank of La., 522 U.S. 470, 475 (1998)). The artful pleading doctrine allows
removal where Congress either expressly provides for removal of a particular state law
action or where federal law completely preempts a plaintiff’s state-law claim. Rivet, 522
U.S. at 475.
Second, even where “federal law does not create the cause of action, federal
question jurisdiction may exist if [Plaintiff’s] ‘state-law claim necessarily raise[s] a stated
federal issue, actually disputed and substantial, which a federal forum may entertain
without disturbing any congressionally approved balance of federal and state judicial
responsibilities.’” Great Lakes Gas Trans. Ltd. P’ship v. Essar Steel Minnesota LLC, 843
F.3d 325, 331 (8th Cir. 2016) (quoting Grable & Sons Metal Prods., Inc. v. Darue Eng’g &
Mfg., 545 U.S. 308, 314 (2005)). The Supreme Court has recognized a “special and small
category” of cases that fit into this framework, Empire Healthchoice Assur., Inc. v.
McVeigh, 547 U.S. 677, 699 (2006), “where vindication of a right under state law
necessarily turned on some construction of federal law,” Merrell Dow Pharmaceuticals,
Inc. v. Thompson, 478 U.S. 804, 808–09 (1986) (quotation omitted).
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B.
Analysis
1.
Federal Common Law
Defendants’ first asserted ground for removal is that the Court has original
jurisdiction because the State’s claims arise under federal common law and cannot be
resolved under state law. Only a few limited areas of federal common law survived Erie
R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938). In particular, courts have determined that
federal common law applies where a federal decision is required “to protect uniquely
federal interests,” Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398, 427 (1964), or
where “our federal system does not permit the controversy to be resolved under state
law, either because the authority and duties of the United States as sovereign are
intimately involved or because the interstate or international nature of the controversy
makes it inappropriate for state law to control.” Texas Indus., Inc. v. Radcliff Materials,
Inc., 451 U.S. 630, 641 (1981). Defendants argue that the State’s Complaint necessarily
arises under three areas controlled by federal common law: interstate pollution,
navigable waters, and foreign affairs. Defendants further argue that federal jurisdiction
is proper because state law cannot apply to the claims alleged.
i. Interstate Pollution
First, Defendants argue that the State’s claims are premised upon interstate
pollution because the State’s alleged injuries stem from climate change impacts, which
are caused by global emissions and are inherently transboundary in nature. The Supreme
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Court has specifically recognized federal common law in the arena of transboundary
pollution and environmental protection, see Am. Elec. Power Co. v. Connecticut, 564 U.S.
410, 421 (2011) (“When we deal with air and water in their ambient or interstate aspects,
there is federal common law.”), but has also held that this area of federal common law
has largely (though not entirely) been displaced by environmental statutes, including the
Clean Air Act and Clean Water Act, see e.g., id. at 424 (finding that the “Clean Air Act and
the EPA actions it authorizes displace any federal common-law right to seek abatement
of carbon-dioxide emissions from fossil-fuel fired powerplants”); Int’l Paper v. Ouellette,
479 U.S. 481, 497 (1987) (“The CWA precludes only those suits that may require standards
of effluent control that are incompatible with those established by the procedures set
forth in the Act.”).
Defendants cite a number of cases to support their argument that federal common
law should govern; however, in each of these precedential cases, a cause of action for
interstate pollution was alleged on the face of the complaint, which is not the case here. 1
Despite the fact that the State alleges no causes of action related to pollution regulations
See, AEP, 564 U.S. at 415 (federal common law public nuisance claims against carbon-dioxide
emitters seeking cap on emissions); Illinois v. Milwaukee, 406 U.S. 91, 93 (1972), superseded by
statute (cause of action for pollution of Lake Michigan); Ouellette, 479 U.S. at 483–84 (1987)
(common law nuisance for discharges into interstate lake); Native Village of Kivalina v.
ExxonMobil Corp., 696 F.3d 849, 853 (2012) (federal common law public nuisance claims against
for greenhouse gas emissions and climate change injuries); City of New York v. BP p.l.c., 325 F.
Supp. 3d 466, 470 (S.D.N.Y. 2018) (public nuisance, private nuisance, and trespass claims related
to sea level rise, increased flooding, and temperature increases). However, City of New York does
not provide a framework for removal based upon federal common law because the action was
originally filed in federal court.
1
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or disputes between states over emissions standards, Defendants argue that the State
has not pleaded sufficient facts to support its consumer protection claims, and therefore
the complaint must actually establish a cause of action for interstate pollution under the
federal common law.
To adopt Defendants’ theory, the Court would have to weave a new claim for
interstate pollution out of the threads of the Complaint’s statement of injuries. This is a
bridge too far. Because Defendants do not plausibly identify any actual disputes related
to interstate pollution that must be resolved to reach the merits of the State’s pleaded
claims, federal common law does not establish a basis for jurisdiction on this ground.
ii. Navigable Waters
Similarly, Defendants argue that federal common law must govern because the
State seeks remedies for injuries related to flooding, damage, and contamination of
navigable waters. Again, the cases that Defendants rely on establish that federal common
law is required to resolve issues not present here; in particular, to mediate conflict
between the states or between states and the federal government related to interstate
water bodies. 2 Although flooding is an alleged injury related to the consumer protection
claims, the State’s action does not purport to regulate, apportion, or mediate other
See Hinderlider v. La Plata River & Cherry Creek Ditch Co., 304 U.S. 92, 110 (1938)
(apportionment of water of an interstate stream between two states is a question of federal
common law); Milwaukee I, 406 U.S. at 105 n.6 (conflict over pollution discharged by one state
into water body that bordered four states); Michigan v. U.S. Army Corps of Engineers, 667 F.3d
765, 767–68 (7th Cir. 2011) (action related to federal management of interstate waterway).
2
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states’ or agencies’ relationships to navigable waters, and the federal common law of
navigable waters is not necessarily raised here.
iii. Foreign Affairs
Third, Defendants argue that the State’s claims are of an inherently international
nature because the regulation of energy production and trade has important foreign
policy implications and is accordingly within the exclusive purview of the federal courts.
Defendants claim that, because fossil fuels are strategically important domestic and
international resources, the State’s case is intended to have significant impacts on United
States foreign policy. The Court declines Defendants’ invitation to interpret this wellpleaded consumer protection action as a wholesale attack on all features of global fossil
fuel extraction, production, and policy.
iv. State Law
Finally, Defendants contend that federal jurisdiction is proper because state law
cannot control claims that seek to regulate the interstate and international production
and sale of fossil fuels. The State does, however, have a clear interest in preventing fraud
and deception and ensuring that citizens have access to accurate information in the
consumer marketplace. See e.g., Edenfield v. Fane, 507 U.S. 761, 768–69 (1993). Because
the State’s claims fall squarely within that area of state interest, the claims do not open
the door for substantive challenges to Minnesota’s (or any other state’s) emissions or
water quality standards. Neither do the claims alleged require the Court to assess federal
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management of navigable waters or weigh any issues of foreign policy. Accordingly,
federal common law is not applicable.
v. Federal Common Law as a Basis for Removal
Even if the Court could conjure a separate claim arising from the State’s alleged
environmental injuries that would fall within an area of federal common law, it still may
not confer jurisdiction. Defendants argue that federal common law provides a basis for
federal jurisdiction because (1) courts have recognized an exception to the well-pleaded
complaint rule where plaintiff’s putative state law claims arise under federal common
law, and (2) federal common law presents a substantial federal question for the purposes
of asserting jurisdiction under the Grable doctrine. The Court will address the Grable
doctrine in Section 2.
As noted above, the Supreme Court has established two exceptions to the wellpleaded complaint rule: express provision of Congress and complete preemption. Rivet,
522 U.S. at 475. A federal statute completely preempts artfully pleaded state law claims
if it “provide[s] the exclusive cause of action for the claim asserted and also set[s] forth
procedures and remedies governing that cause of action[,]” Beneficial Nat’l Bank v.
Anderson, 539 U.S. 1, 8 (2003), and the statute’s pre-emptive force is “so extraordinary
that it converts an ordinary state common-law complaint into one stating a federal claim
for purposes of the well-pleaded complaint rule.” Caterpillar, Inc., 482 U.S. at 393
(quotation omitted). Complete preemption is distinct from ordinary preemption, which
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provides a defense against state law claims, but does not establish a pathway for federal
jurisdiction. See Johnson v. MFA Petroleum Co., 701 F.3d 243, 247 (8th Cir. 2012).
Defendants suggest that complete preemption is not required for removal because
the State’s claims inherently arise under federal common law, and artful pleading that
disguises a federal cause of action is a separate and distinct basis for removal than
complete preemption. However, neither the Eighth Circuit nor the Supreme Court has
found that implied federal common law claims establish a separate and independent
exception to the well-pleaded complaint rule. To the extent that the cases Defendants
cite carve out a third exception, this approach lacks support in this circuit and is contrary
to Supreme Court precedent establishing the specific and defined parameters for federal
jurisdiction over exclusively state law claims. See Caterpillar, 482 U.S. at 392–94; Rivet,
522 U.S. at 474–75.
Further, in each of the cases Defendants cite to support this argument, plaintiffs’
precise claims were explicitly connected to or relied upon interpretations of a discrete
area of federal law. 3 Here, Defendants proffer multiple theories for how Plaintiff’s claims
See In re Otter Tail Power Co., 116 F.3d 1207, 1215 (8th Cir. 1997) (state law claims involved
tribal regulatory authority and raised important questions of federal law requiring interpretation
of treaties, federal statutes, and the federal common law of inherent tribal sovereignty); Sam L.
Majors Jewelers v. ABX, Inc., 117 F.3d 922, 928. (5th Cir. 1997) (claims arising out of “clearly
established federal common law cause of action against air carriers for lost shipments.”); Treiber
& Straub, Inc. v. UPS, Inc., 474 F.3d 379, 384 (7th Cir. 2007) (same); Caudill v. Blue Cross and Blue
Shield of N.C., 999 F.2d 74, 76–77 (4th Cir. 1993) (applying federal jurisdiction to state-law claims
pursuant to Federal Employees Health Benefits Act), abrogated by Empire HealthChoice Assur.
Inc. v. McVeigh, 547 U.S. 677, 693 (2006); Battle v. Seibels Bruce Ins. Co., 288 F.3d 596, 607 (claims
requiring interpretation of insurance policies issued pursuant to the National Flood Insurance
3
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might be related to federal common law but as noted above, each of these theories lacks
a substantial relationship to the actual claims alleged and would require the Court to
invent a separate cause of action. That is beyond the Court’s discretion and is not a sound
foundation for asserting federal jurisdiction.
Because the Court finds that the claims alleged by the State do not arise under
federal common law and Defendants do not plausibly allege that the claims are
completely preempted, federal common law is not a sufficient independent basis for
removal in this manner.
2.
Grable Jurisdiction
Defendants’ second argument for removal is that this action necessarily raises and
requires the resolution of substantial questions of federal law. Federal jurisdiction may
be asserted over a state-law claim if a federal issue is: “(1) necessarily raised, (2) actually
disputed, (3) substantial, and (4) capable of resolution in federal court without disrupting
the federal-state balance approved by Congress.” Gunn, 568 U.S. at 258 (citing Grable &
Sons Metal Products, Inc. v. Darue Eng. & Mf’g, 545 U.S. 308, 313–14 (2005)). All four
criteria, often referred to as the “Grable doctrine,” must be met to exercise federal
jurisdiction. Id.
Program governed exclusively by federal common law); Newton v. Captial Assur. Co., Inc., 245
F.3d 1306, 1308–09 (11th Cir. 2001) (same).
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i. Necessarily Raised
Defendants offer various avenues for the Court to find that the claims necessarily
raise disputed federal issues, including foreign policy considerations, injuries to and
management of the navigable waters of the United States, and transboundary pollution.
Defendants also assert that the claims implicate Congress’s careful policymaking balance
between energy production and environmental protection, Defendants’ alleged influence
over policymakers’ decisions, and constitutional questions of federalism.
The Court has already rejected Defendants’ arguments that the Complaint
necessarily raises issues related to management of navigable waters, transboundary
pollution, or foreign policy. Contrary to Defendants’ assertions, the Complaint does not
require interpretation of any federal environmental regulations or climate treaties, nor
does it ask a court to review federal agencies’ management of interstate waters. The
Complaint only requires a court to determine whether Defendants engaged in a
misinformation campaign that ran afoul of Minnesota’s consumer protection statutes and
common law, and whether the State can demonstrate that those alleged violations of
discrete state laws caused harm to Minnesota and Minnesota consumers.
With regard to Congress’s careful balance between energy and environmental
priorities, Defendants do not appear to argue that Congress sanctioned, directed, or
participated in the alleged scheme to defraud the public. Accordingly, determining
whether Defendants engaged in a misinformation campaign in violation of Minnesota law
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does not require a court to second-guess Congress’s priorities regarding energy
production and environmental protection.
Defendants further argue that the Complaint necessarily asserts federal claims to
the extent that it alleges that federal policymakers would have adopted different energy
and climate policies but-for Defendants’ alleged misrepresentations. However, the
Complaint includes policymakers as a category of individuals who relied on Defendants’
allegedly fraudulent misrepresentations in deciding to continue to purchase and use
Defendants’ fossil-fuel products.
It does not argue that any particular policies or
regulatory decisions would be different but-for Defendants’ actions, and therefore does
not implicate Congress’ careful regulatory framework.
As to questions of federalism, Defendants allege that the State seeks to supplant
the federal government’s authority over federal questions and requires the Court to
consider the constitutional division of authority between the federal government and the
states. This gravely overstates the State’s case, and it is unclear to the Court how a state
court adjudicating a set of claims that fall well within a state’s consumer protection
interest will necessarily challenge the foundations of our system of government.
Defendants also claim that proving the specific elements of the causes of action
will require a court to wade into disputed and substantial federal questions, including
whether fossil fuels are unreasonably dangerous, and whether Defendants actually
misrepresented the dangers of climate change and the urgency required to mitigate
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climate change. Again, Defendants overstate both the State’s claims and what is required
to prove them under Minnesota law. 4
Although Defendants have identified ways in which the State’s claims may be
tangentially related to federal law, “it takes more than a federal element to open the
‘arising under’ door” to federal jurisdiction. Empire Healthchoice, 547 U.S. at 701 (quoting
Grable, 545 U.S. at 313). The federal issues that Defendants offer are not necessarily
raised by the Complaint’s state-law claims, and vindication of the State’s rights under
state consumer protection law does not “necessarily turn on some construction of federal
law.” Franchise Tax Board, 463 U.S. at 9.
It is not necessary for the Court to weigh Minnesota’s ability to prove the elements of the state
law claims here; it is Defendants’ burden to demonstrate that these claims warrant federal
jurisdiction. Nevertheless, the Court notes that adjudicating the State’s failure to warn claims do
not require a court to supplant its judgment for Congress’s regarding the safety and use of a
product, as Defendants allege. While the danger of a product is raised in a failure to warn action,
it is in the context of whether a warning was adequate under state law, and does not require a
court to determine whether the product should have been manufactured, sold, and consumed
generally. See, e.g., Glorvigen v. Cirrus Design Corp., 816 N.W.2d 572, 582 (Minn. 2012)
(explaining that the duty to warn consists of two duties: (1) to give adequate instructions for safe
use; and (2) to warn of dangers inherent in improper use); Frey v. Montgomery Ward & Co., 258
N.W.2d 782, 788 (Minn. 1977) (stating the rule that, where a manufacturer has “actual or
constructive knowledge of danger to users, the . . . the manufacturer has a duty to warn of such
dangers.”); Gray v. Badger Mining Corp., 676 N.W.2d 268, 274 (Minn. 2004) (explaining
conditions of legal adequacy for warnings). As to the State’s other statutory claims under
Minnesota’s various consumer protection and trade practices statutes, Defendants’ own
explanations of the law demonstrate that the State’s claims only require proving that Defendants
engaged in misinformation, deception, fraud, or otherwise unfair practices prohibited by state
law; the claims alleged do not require the Court to make determinations about fossil fuels or
federal energy policy in general.
4
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ii. Actually Disputed and Substantial
Having found that the State’s action does not necessarily raise the federal issues
offered by Defendants, the Court need not proceed to address the other Grable factors.
However, the Court notes that, while the complex features of global climate change
certainly present many issues of great federal significance that are both disputed and
substantial, the State here does not bring claims capable of addressing the panoply of
social, environmental, and economic harms posed by climate change. The State’s
Complaint, far more simply, seeks to address one particular feature of the broader
problem—Defendants’ alleged misinformation campaign. The State’s case is constrained
by the causes of action asserted in its Complaint. Accordingly, the State must prove that
its purported injuries are related to Defendants’ alleged violations of state laws, and any
judicial remedies will likely be limited and responsive to those specific claims. As a result,
this action does not present the doomsday scenario that Defendants present, and neither
does it necessarily raise the disputed and substantial issues of federal law that are
required for the Court to assert jurisdiction pursuant to Grable.
iii. Federal/State Balance
Moreover, the Court finds that its efforts to exercise jurisdiction over this case may
disrupt the balance between federal and state courts. In this case, the state court will not
need to reach any question of federal law to litigate these claims, nor will the state court’s
holding “stand as binding precedent for any future [consumer fraud or climate-change
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injury] claim[.]” Gunn, 568 U.S. 264. The State asks the court to determine only whether
Defendants are liable for misleading the public and engaging in consumer fraud under
state law. For the federal court to assert jurisdiction over these areas of traditional state
jurisdiction may disrupt the balance between state and federal judicial authority.
Ultimately, Defendants question whether there can be a state law action for
alleged climate change injuries at all. The Court does not disagree that assessing this type
of injury raises broad and complicated questions. However, allegations of a complex
injury do not create a pathway for federal jurisdiction when the actual causes of action
arise only under state law. Accepting Defendants’ interpretation of Grable jurisdiction
would require the Court to make an exceptional logical leap and interpret this Complaint
as a full-scale assault on all aspects of fossil fuel extraction, production, distribution, and
use. That is not what the Complaint asserts on its face, and it is not within the Court’s
authority to rewrite the Complaint and make it so.
3.
Federal Officer Removal Statute
Defendants’ next proffered removal ground is the federal officer removal statute,
28 U.S.C. § 1442(a)(1), which requires that the removing defendant plausibly allege that
(1) the defendant is a “person” under the statute, which is undisputed here; (2) the
defendant was “acting under” the direction of a federal officer when it engaged in the
allegedly tortious conduct; (3) there is a causal connection between the defendant’s
actions and the official authority; and (4) the defendant raises a “colorable” federal
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defense. See; Jacks v. Meridian Res. Co., 701 F.3d 1224, 1230 (8th Cir. 2012). Relevant
here is the federal government contractor defense, which provides that suits against
defendants acting on behalf of federal officers “may be removed despite the nonfederal
cast of the complaint; the federal-question element is met if the defense depends on
federal law[.]” Jefferson County v. Acker, 527 U.S. 423, 431 (1999).
i. “Acting Under”
Defendants first argue that they were “acting under” the direction of federal
officers in the production of fossil fuels and the development of specialized military
products in support of multiple war efforts since at least World War II. Second,
Defendants argue that they have worked under federal direction to extract and produce
critical energy resources for the nation, including exploration and development of
resources in the Outer Continental Shelf and as operators and lessees of the Strategic
Petroleum Reserve infrastructure. The Court finds that these are plausible ways in which
Defendants may have acted under the direction of federal officers, and because the Court
lacks information about whether Defendants’ alleged tortious conduct occurred when
Defendants were acting under federal officer control, the Court will proceed with the
analysis.
ii. Connection to Claims
Historically, courts have considered the causal connection requirement to be a low
hurdle. See, e.g., Graves v. 3M Co., 447 F. Supp. 3d 908, 913 (D. Minn. 2020) (citing
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Isaacson v. Dow Chem. Co., 517 F.3d 129, 137 (2d Cir. 2008). Indeed, in 2011, Congress
amended the statute to encompass suits “for or relating to any act under color of
[federal] office.”
28 U.S.C. § 1442(a)(1) (2011) (emphasis added); see also In re
Commonwealth's Motion to Appoint Counsel Against or Directed to Def. Ass’n of
Philadelphia, 790 F.3d 457, 471 (3d Cir. 2015), as amended (June 16, 2015) (discussing the
2011 amendment). As a result of the amendment, all that is required is that the case
relates to an official act. For example, the Third Circuit has found that the condition is
met so long as Defendants’ conduct has a “connection” or “association” with a
governmental act. In re Commonwealth’s Motion, 790 F.3d at 471. However, Defendants
are still required to demonstrate that the act for which they are being sued occurred at
least in part “because of what they were asked to do by the Government.” Graves, 447
F. Supp. 3d at 913. (emphasis in original) (quoting Isaacson v. Dow Chem Co., 517 F.3d
1129, 137 (2d Cir. 2008).
Defendants argue that their fossil fuel activities satisfy the low threshold of
connection to or association with actions directed by the federal government. However,
Defendants do not claim that any federal officer directed their respective marketing or
sales activities, consumer-facing outreach, or even their climate-related data collection.
Accordingly, despite the low bar, there does not appear to be any direction from or
connection to the federal government related to the specific claims alleged here.
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iii. Colorable Defense
Although the lack of connection to a federal officer alone is fatal to federal officer
jurisdiction, the Court notes that the fourth prong also fails. The federal officer removal
statute requires that the defendant identify a federal defense to the claim brought against
them in state court, but a defendant need only demonstrate that its defense is
“colorable,” not “clearly sustainable.” Jacks v. Meridian Res. Co., LLC, 701 F.3d 1224, 1235
(8th Cir. 2012). “For a defense to be considered colorable, it need only be plausible;
§ 1442(a)(1) does not require a court to hold that a defense will be successful before
removal is appropriate.” United States v. Todd, 245 F.3d 691, 693 (8th Cir. 2001).
In a footnote, Defendants claim a number of defenses, including preemption under
the Clean Air Act, the Commerce Clause, the First Amendment, and the foreign affairs
doctrine, although they do not describe any particular defense or why it justifies
application of the federal officer removal statute. As discussed with regard to the Grable
doctrine and federal common law, the State does not raise claims related to
environmental regulation or foreign policy, therefore the Clean Air Act and foreign affairs
doctrine do not pose colorable defenses. As to the Commerce Clause and the First
Amendment, Defendants do not explain exactly how these defenses relate either to the
claims or actions taken at the direction of a foreign officer. Because it is the Defendants’
burden to demonstrate a colorable defense now, and not “the mere possibility of some
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future evidence as the basis for removal,” Graves, 447 F. Supp. 3d at 916 n.8, Defendants
have not met this hurdle to federal jurisdiction.
Defendants have failed to satisfy three of the four elements of the federal officer
removal statute, and the Court cannot, therefore, exercise jurisdiction on this basis.
4.
Outer Continental Shelf Lands Act
The Outer Continental Shelf Lands Act (“OCSLA”) establishes original jurisdiction in
federal district courts over “cases and controversies arising out of, or in connection with
(A) any operation conducted on the outer Continental Shelf, or which involves rights to
such minerals, or (B) the cancellation, suspension, or termination of a lease or permit
under this subchapter.” 43 U.S.C. § 1349(b)(1). The outer Continental Shelf (“OCS”)
includes all submerged lands lying seaward that are subject to the jurisdiction and control
of the United States, but are outside of any particular State. 43 U.S.C. §§ 1301(a), (f),
1331(a). The Fifth Circuit has interpreted the jurisdictional grant under OCSLA broadly,
only requiring a “but-for connection” between the cause of the action and OCS operation.
In re Deepwater Horizon, 745 F.3d 157, 163 (5th Cir. 2014).
Despite Defendants’ argument that their various activities on the OCS necessarily
account for a significant portion of the conduct attributable to alleged climate change
injuries in Minnesota, the State’s claims are rooted not in the Defendants’ fossil fuel
production, but in its alleged misinformation campaign. Further, Defendants offer no
basis for the Court to conclude that Minnesota’s alleged injuries would not have occurred
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but-for the Defendants’ extraction activities on the OCS. Accord Mayor and City Council
of Baltimore v. BP, 388 F. Supp. 3d 538, 566–67 (D. Md. 2019) (rejecting federal
jurisdiction under OCSLA based on lack of evidence of but-for causation).
Defendants also argue that, because the Complaint seeks potentially billions of
dollars in damages, restitution, and equitable relief, this action could substantially
discourage production on the OCS and undermine the viability of the federal
government’s leasing program. This argument is highly speculative and quite unlikely and
asks the Court to assume both the outcome of the suit in state court and the highest
damages award possible. This type of speculation, however, does not establish a stable
ground for supporting removal, and the Court finds that it lacks jurisdiction under OCSLA.
5.
Federal Enclave
Defendants next argue that federal jurisdiction is appropriate because the action
implicates federal enclaves in four distinct ways: (1) by targeting the alleged impacts of
Defendants’ oil and gas operations, the Complaint necessarily sweeps in operations that
occur on military bases and other federal enclaves; (2) the Complaint’s allegations of
climate change injuries—including extreme heat, crop damage, drought, flooding,
infrastructural damage, and disease—necessarily impact federal enclaves in Minnesota,
including Fort Snelling Military Reservation, Federal Correctional Institute Sandstone, and
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Cass Lake Indian Hospital 5; (3) the claims arise out of sales of certain Defendants’ products
within Minnesota, which include sales on unspecified federal enclaves; and (4) to the
extent the Complaint asserts that federal policymakers would have adopted different
energy and climate policies absent Defendants’ alleged misrepresentations, the
Complaint touches on conduct occurring in the District of Columbia, a federal enclave.
“A federal enclave is created when a state cedes jurisdiction over land within its
borders to the federal government and Congress accepts that cession. These enclaves
include numerous military bases [and] federal facilities.” Allison v. Boeing Laser Tech.
Servs., 689 F.3d 1234, 1235 (10th Cir. 2012). The constitutional grant of legislative power
to Congress over federal enclaves “bars state regulation without specific congressional
action.” W. River Elec. Ass’n, Inc. v. Black Hills Power & Light Co., 918 F.2d 713, 716 (8th
Cir. 1990) (quoting Paul v. United States, 371 U.S. 245, 263 (1963)).
“[I]n enclave jurisdiction, the determinative fact is the precise location of the
events giving rise to the claims for relief.” Akin v. Big Three Indus., Inc., 851 F. Supp. 819,
824 (E.D. Tex. 1994) (emphasis omitted). When an alleged injury has occurred both on
and off the federal enclave, federal jurisdiction is proper if the federal enclave was the
To establish a federal enclave, (1) the United States must acquire land in a state for one of the
purposes mentioned in the Enclave Clause, (2) the state legislature must consent to the
jurisdiction of the federal government, and (3) the federal government must accept the
jurisdiction by filing a notice of acceptance with the state governor or in another manner
prescribed by the laws of the state. See 40 U.S.C. § 3112(b); Paul v. United States, 371 U.S. 245,
264 (1963); see also U.S. Const. Art. I, § 8, cl. 17. Defendants state that these sites in Minnesota
are federal enclaves, but do not provide documentation to satisfy the criteria.
5
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locus in which the tort claim arose. See Sultan v. 3M Co., No. 20-1747, 2020 WL 7055576,
at *8 (D. Minn. Dec. 2, 2020). Even if some of the injuries occur inside while some occur
outside of the federal enclave, the federal interest in exercising federal jurisdiction over
the resultant claims decreases. See Akin, 851 F. Supp. at 825 n.4.
The State specifically disclaims “injuries arising on federal property and those that
arose from Defendants’ provision of fossil fuel products to the federal government for
military and national defense purposes.” (Compl. ¶ 9 n.4.) Defendants contend that this
disclaimer is ineffective because it offers no method to isolate injuries that arose on
federal property. 6 However, the burden is on Defendants to demonstrate that federal
enclaves are the locus in which the claims arose, and they have not done so. See Sultan,
2020 WL 7055576, at *4. While the various injuries alleged in the complaint may be felt
on federal enclaves as much as they are felt anywhere, the Court requires a more
Further, Defendants counter that the Attorney General cannot sidestep federal jurisdiction by
disclaiming damages for events that took place in federal enclaves. However, both of the cases
that Defendants cite for this proposition, Fung v. Abex Corp., 816 F. Supp. 569, 571 (N.D. Cal.
1992) and Richard v. Lockheed Martin Corp., 2012 WL 13081667, at *2 (D.N.M. Feb. 24, 2012),
involve personal injury claims in which the injuries largely occurred on federal enclaves. In Fung,
the injuries involved asbestos exposure on submarines that were supervised by a contractor, but
that were regularly docked at United States naval bases (there, the Court found the Federal
Officer Removal Statute to be of greater significance than the enclaves); in Richards, the injuries
largely occurred on White Sands Missile Range. Here, Defendants do not claim that any particular
injury occurred on a federal enclave; they merely allege that the State cannot effectively disclaim
injuries on enclaves. Because neither party has identified injuries that specifically occurred on a
federal enclave, these cases do not support Defendants’ argument that federal enclave
jurisdiction is proper here.
6
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substantive and explicit relationship between the actual claims alleged and a specific
federal enclave to exercise jurisdiction.
6.
Class Action Fairness Act
Defendants also raise the possibility of jurisdiction under CAFA, 28 U.S.C. § 1453(b),
on the theory that the case is actually a class action in which the Attorney General has
brought a representative suit on behalf of a group of similarly situated persons. CAFA
expands federal diversity jurisdiction to allow for minimal diversity in class actions filed
under Federal Rule of Civil Procedure 23 or similar state statute or rule of judicial
procedure, 28 U.S.C. § 1332(d)(1)(B), in which more than $5 million is in controversy and
there are greater than 100 members of proposed plaintiff classes. Id. § 1332(d)(5), (6);
Pirozzi v. Massage Envy Franchising, Inc., 938 F.3d 981, 983 (8th Cir. 2019). Defendants
argue that, while this case is not styled as a class action, because it is brought in a
representative capacity and seeks restitution and damages on behalf of many potential
plaintiffs, it resembles a purported class action and should therefore be considered a class
action under CAFA.
However liberally interpreted, federal jurisdiction under CAFA is limited to civil
actions either filed under Rule 23 or brought under a similar state mechanism that
authorizes class actions. In the Eighth Circuit, an action can be interpreted as a class
action subject to CAFA even where Plaintiff has omitted reference to the authorizing
procedural rule or statute, but only where the state class action rule actually governs the
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action. See Williams v. Emp’rs Mut. Cas. Co., 845 F.3d 891, 901 (8th Cir. 2017). Defendants
have identified no state statute or procedural rule that would classify a suit of this nature
as a class action. 7 Further, as the State points out, every court to have addressed the
application of CAFA to actions brought by a State in parens patriae under state common
law or consumer protection statutes has found that CAFA is not applicable. 8 Because
The cases Defendants cite do not support their argument that the present action should, or
even could, be subject to CAFA. Both Addison Automatics, Inc. v. Hartford Cas. Ins. Co., 731 F.3d
740 (7th Cir. 2013) and Williams, 845 F.3d 891 are cases in which representatives of certified
classes attempted to make separate claims against the same defendants as individuals. In both
of those cases, the Courts found that omitting reference to the existing class or applicable state
statute did not allow the defendant to dodge CAFA jurisdiction. Neither of these cases dealt with
an action brought by an Attorney General on behalf of a state where no class action has been
claimed or certified. The case that Defendants characterize as most “instructive,” Song v. Charter
Comm’ns. Inc., is an order on a Motion to Compel Arbitration and Stay Proceedings that does not
substantively deal with the CAFA issue at all, except to include a short footnote noting that
Plaintiff opposed CAFA jurisdiction, but the Court felt that the jurisdictional determination was
within its discretion. No. 17-325, 2017 WL 1149286, at *1 n.1 (S.D. Cal. Mar. 28, 2017). Dart
Cherokee Basin Op. Co. LLC v. Owens deals with a case filed as a class action in state court, where
the dispute was about whether the amount in controversy met the $5 million CAFA threshold.
574 U.S. 81, 85 (2014). Defendants also cite Missouri ex rel. Koster v. Portfolio Recovery Assocs.,
Inc., for the proposition that the Eighth Circuit has not weighed in on the issue of CAFA application
to parens patriae actions. 686 F. Supp. 2d 942, 944–47 (E.D. Mo. 2010). However, the court in
Koster found that a request for treble damages did not convert a parens patriae action into either
a “mass action” or a “class action” under CAFA and declined to exercise federal jurisdiction. Id.
7
See Mississippi ex rel. Hood v. AU Optronics Corp., 571 U.S. 161, 164 (2014) (parens patriae suit
is not a “mass action” under CAFA); Hawaii ex rel. Louie v. HSBC Bank Nevada, 761 F.3d 1027,
1040 (9th Cir. 2014) (“Failure to request class status or its equivalent is fatal to CAFA
jurisdiction.”); Purdue Pharma L.P. v. Kentucky, 704 F.3d 208, 212–20 (2d Cir. 2013) (determining
parens patriae action was not “filed under” state statute or rule of judicial procedure “similar” to
federal class action rule, and thus action did not qualify as a “class action” within the meaning of
CAFA); Mississippi ex rel. Hood v. AU Optronics Corp., 701 F.3d 796, 799 (5th Cir. 2012), rev’d on
other grounds, 571 U.S. 161 (2014) (parens patriae action to enforce state law did not justify
removal under CAFA); LG Display Co. v. Madigan, 665 F.3d 768, 770–72 (7th Cir. 2011) (case
brought by Attorney General was brought under state anti-trust law that did not impose any of
the familiar Rule 23 constraints); Washington v. Chimei Innolux Corp., 659 F.3d 842, 847–49 (9th
Cir. 2011) (“[P]arens patriae suits filed by state Attorneys General may not be removed to federal
8
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neither the Eighth Circuit nor any other court has applied CAFA to a State Attorney
General’s representative action in this way, and because Defendants have not
demonstrated that this action was brought under or would meet the standards of either
Rule 23 or any state rule for class certification, CAFA is not applicable here.
7.
Diversity Jurisdiction
Finally, Defendants argue that the Court has diversity jurisdiction because the real
parties in interest are the citizens of Minnesota, who are completely diverse from
Defendants, and the amount in controversy undisputedly exceeds $75,000. Defendants
argue that the Attorney General seeks compensation for alleged injuries related only to
Minnesota consumers, not the State in general, and that the harm alleged is only to
consumers who were influenced by the purported misinformation campaign, and thus
only applies to a subset of identifiable Minnesotans.
A state “may act as the representative of its citizens in original actions where the
injury alleged affects the general population of a State in a substantial way.” Maryland v.
Louisiana, 451 U.S. 725, 737 (1981). “There is no question that a State is not a ‘citizen’
for purposes of the diversity jurisdiction.” Moor v. Alameda Cty., 411 U.S. 693, 717 (1973).
court because the suits are not ‘class actions' within the plain meaning of CAFA.”); W. Va. ex rel.
McGraw v. CVS Pharmacy, Inc., 646 F.3d 169, 174–78 (4th Cir. 2011); Massachusetts v. Exxon
Mobil Corp., 462 F. Supp. 3d 31, 48–51 (D. Mass. 2020) (finding CAFA does not apply to parens
patriae Attorney General actions); Town of Randolph v. Purdue Pharma L.P., No. 19-10813, 2019
WL 2394253, at *4 (D. Mass. June 6, 2019) (finding no federal jurisdiction under CAFA in parens
patriae opioid action); City of Galax, Virginia v. Purdue Pharma, L.P., No. 18-617, 2019 WL 653010,
at *5–6 (W.D. Va. Feb. 14, 2019) (same).
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The Complaint alleges injury to all Minnesotans and the Attorney General brings the
action pursuant to state statutes and under parens patriae authority on behalf of
Minnesota citizens and consumers. Defendants have not offered any precedent or a
cognizable argument for treating this as anything other than an action by the State of
Minnesota, and therefore this action does not give rise to federal diversity jurisdiction.
CONCLUSION ON MOTION TO REMAND
The Court recognizes that the vast threat of climate change requires a
comprehensive federal, and indeed, global response.
The complex environmental
impacts of climate change, and its far-reaching consequences for health, economy, and
social wellbeing of all people cannot be understated. Given the stakes, the Court has
some reluctance in remanding such significant litigation to state court. But the Court is
also mindful of the limits of its jurisdiction. If the State were—as Defendants suggest—
seeking a referendum on the broad landscape of fossil fuel extraction, production, and
emission, state court would most certainly be an inappropriate venue. However, the
State’s action here is far more modest than the caricature Defendants present. States
have both the clear authority and primary competence to adjudicate alleged violations of
state common law and consumer protection statutes, and a complex injury does not a
federal action make. The limits written into the Complaint likely will restrict the ultimate
possible recovery in this case and thus, its possible impact on climate change, but that is
the choice the State has made. Because this Court does not have original jurisdiction over
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this action, and because the claims alleged neither explicitly raise federal claims nor fall
within one of the exceptions to the well-pleaded complaint rule, the Court must decline
to exercise jurisdiction and remand the matter to state court.
II.
MOTION TO STAY
The FHR Defendants move the Court to stay proceedings until the Supreme Court
issues a decision in BP p.l.c. et al. v. Baltimore and makes a determination on the Petition
for Certiorari in Chevron et al. v. City of Oakland et al. (U.S., Jan. 8, 2021). The FHR
Defendants argue that a stay is warranted because these cases are similar to the instant
action and granting a stay would preserve judicial resources by alleviating the Court’s
need to decide issues now that may be ruled on by the Supreme Court within a few
months. In addition, the FHR Defendants argue that a stay is necessary to prevent serious
hardship, particularly if the Court grants the Motion to Remand and the Supreme Court’s
decisions in either Baltimore or Oakland cast doubt on the remand. Finally, the FHR
Defendants argue that the State cannot plausibly claim any meaningful harm from such a
brief stay. The State opposes this Motion.
Because the Court finds that neither pending matter relied on by the FHR
Defendants bear upon the Court’s decision to remand the case for lack of federal
jurisdiction, the Court will deny the FRH Defendants’ Motion.
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A.
STANDARD OF REVIEW
The Court has the inherent power and broad discretion to stay proceedings to
control its docket, to conserve judicial resources, and to ensure that each matter is
handled with economy of time and effort. Sierra Club v. U.S. Army Corp of Engineers, 446
F.3d 808, 816 (8th Cir. 2006) (citing Clinton v. Jones, 520 U.S. 681, 706 (1997)). A court
may consider factors, including “conservation of judicial resources and the parties’
resources, maintaining control of the court's docket, providing for the just determination
of cases, and hardship or inequity to the party opposing the stay.” Frable v. Synchrony
Bank, 215 F. Supp. 3d 818, 821 (D. Minn. 2016). The moving party bears the burden of
establishing that a stay is necessary. Jones, 520 U.S. at 708. When the stay is requested
pending disposition of a petition for certiorari, “[a]pplicants bear the burden of
persuasion on two questions: whether there is a balance of hardships in their favor; and
whether four Justices of [the Supreme Court] would likely vote to grant a writ of
certiorari.” New York Times Co. v. Jascalevich, 439 U.S. 1304, 1304 (1978).
B.
ANALYSIS
The question addressed by the Supreme Court in Baltimore is specific to the scope
of appellate review of remand orders under 28 U.S.C. § 1447(d). That issue is not present
here, and it will arise only if Defendants appeal the Court’s decision to grant the motion
to remand. The Eighth Circuit, like the Fourth Circuit, has interpreted 28 U.S.C. § 1447(d)
to limit its scope of remand review to the removal grounds established in 28 U.S.C. § 1442
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(federal officer removal) or § 1443 (civil rights claims). See Jacks, 701 F.3d at 1229;
Thornton v. Holloway, 70 F.3d 522, 524 (8th Cir. 1995). Accordingly, the Supreme Court’s
decision in Baltimore will only potentially affect this action at the appellate stage, and
does not bear upon a district court’s determination.
While the petition in the Oakland case raises issues that are more pertinent to the
instant proceedings, the FHR Defendants speculate that at least four Justices of the
Supreme Court are likely to vote to grant certiorari because the Court granted certiorari
in Baltimore. However, the scope of the Oakland defendants’ petition is much broader
than the narrow petition granted in Baltimore. The FHR Defendants generally assert that
the Ninth Circuit’s rejection of the federal common law as a basis for removal is contrary
to Supreme Court precedent, but provide little else to support their position that
certiorari is likely to be granted.
Additionally, although the FHR Defendants argue that a stay will not prejudice the
State, the State counters that a stay would be highly prejudicial to the public interest by
delaying the proceedings for an indeterminate amount of time for the sake of pending
decisions that do not bear upon the merits of this action. Of course, Defendants may
appeal this decision which would result inevitably in a much longer delay. But balancing
the hardships between the two parties, and not knowing whether the Defendants will
appeal the remand, the Court finds that the State would likely be more prejudiced by a
stay than Defendants would be by proceeding, particularly because Defendants cannot
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CASE 0:20-cv-01636-JRT-HB Doc. 76 Filed 03/31/21 Page 37 of 37
anticipate any relevant relief at this juncture related to the Baltimore case and the status
of the Oakland petition is still very much uncertain. Ultimately, the possible prejudice to
both sides is quite similar, and the Court will choose to try to move the case along as
quickly as possible.
The Court therefore finds that Defendants have not met their burden of persuasion
that a stay is necessary and denies the Motion.
ORDER
Based on the foregoing, and all the files, records, and proceedings herein, IT IS
HEREBY ORDERED that:
1. Plaintiff’s Motion to Remand [Docket No. 32] is GRANTED.
2. FHR Defendants’ Motion to Stay [Docket No. 56] is DENIED.
LET JUDGMENT BE ENTERED ACCORDINGLY.
DATED: March 31, 2021
at Minneapolis, Minnesota.
____
____
JOHN R. TUNHEIM
Chief Judge
United States District Court
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