Comer v. Murphy Oil Usa

• Decision Date: 16 October 2009
• Docket Number: No. 07-60756.,07-60756.
• Parties: Ned COMER, et al., Plaintiffs-Appellants, v. MURPHY OIL USA, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

585 F.3d 855

Ned COMER, et al., Plaintiffs-Appellants, v. MURPHY OIL USA, et al., Defendants-Appellees.

No. 07-60756.

United States Court of Appeals, Fifth Circuit.

October 16, 2009.

F. Gerald Maples (argued), Alexander Jacob Williamson, Carlos A. Zelaya, II, F. Gerald Maples, P.A., Stephen Michael Wiles, Reasonover & Olinde, LLC, New Orleans, LA, for Plaintiffs-Appellants.

Michael Raudon Phillips, Benjamin Melvin Castoriano, Frilot, L.L.C., New Orleans, LA, Shellye V. McDonald, Richard P. Salloum, Franke & Salloum, Gulfport, MS, for Murphy Oil, USA, Universal Oil Products and Honeywell Intern., Inc.

Mary S. Johnson, Johnson, Gray, McNamara, LLC, Mandeville, LA, Daniel P. Collins, Munger, Tolles & Olson, L.L.P., Los Angeles, CA, Thomas M. McNamara, Johnson, Gray, McNamara, L.L.C., Lafayette, LA, for Shell Oil Co.

Richard L. Forman, Forman, Perry, Watkins, Krutz & Tardy, L.L.P., Jackson, MS, John F. Daum, O'Melveny & Myers, Los Angeles, CA, for ExxonMobil Corp.

Thomas Lynn Carpenter, Carr, Allison, Pugh, Howard, Oliver & Sisson, PC, Gulfport, MS, Rick Richmond, Brent L. Caslin, Jenner & Block, L.L.P., Los Angeles, CA, for AES Corp.

William Lee Watt, Brunini, Grantham, Grower & Hewes, P.L.L.C., Jackson, MS,

for Allegheny Energy, Inc. and Reliant Energy, Inc.

Kathleen Taylor Sooy, Tracy Roman, Scott L. Winkleman (argued), Crowell & Moring, L.L.P., Washington, DC, Robert Donald Gholson, Gholson, Burson, Entrekin & Orr, Laurel, MS, for Alliance Resource Partners, LP, Alpha Natural Resources, Inc., Arch Coal, Inc., Consol Energy, Inc., Foundation Coal Holdings, Inc., Intern. Coal Group, Inc., Massey Energy Co., Natural Resource Partners, LP, Peabody Energy Corp. and Westmoreland Coal Co.

Michael B. Gerrard, Nancy Gordon Milburn, Arnold & Porter, New York City, John Gwin Wheeler, Mitchell, McNutt & Sams, Tupelo, MS, for BP America Production Co. and BP Products North America, Inc.

Peter D. Keisler, Quin Mikael Sorenson, Sidley Austin, L.L.P., Washington, DC, for Cinergy Corp. and Duke Energy Corp.

Christopher Ray Fontan, Brunini, Grantham, Growers, Hewes, P.L.L.C., Jackson, MS, for Allegheny Energy, Inc., Reliant Energy, Inc. and Cinergy Corp.

Kenneth W. Barton, Benjamin M. Watson, Butler, Snow, O'Mara, Stevens & Cannada, Jackson, MS, for ConocoPhillips Co.

Sarah E. Iiams, Abbott‹ Simses, A.P.L.C., New Orleans, LA, for Dow Chemical Co. and EI Dupont De Nemours & Co.

Raymond Michael Ripple, Donna L. Goodman, DuPont Legal, Wilmington, DE, for E I DuPont De Nemours & Co.

Lawrence E. Abbott, Abbott, Simses & Kuchler, Covington, LA, for Dow Chemical Co. and E I DuPont De Nemours & Co.

Charles Edwin Ross, William B. Lovett, Jr., Wise, Carter, Child & Caraway, Jackson, MS, for Entergy Corp.

Edwin W. Small, TVA, Knoxville, TN, for TVA.

Thomas E. Fennell, Michael L. Rice, Jones Day, Dallas, TX, John G. Corlew, Kathy K. Smith, Corlew, Munford & Smith, P.L.L.C., Jackson, MS, for Xcel Energy, Inc.

Robert E. Meadows, Jonathan Lawrence Marsh, Trade Jo Renfroe, King & Spalding, Houston, TX, for Chevron USA, Inc.

David Lee Martindale, Cypress, TX, for Shell Oil Co. and Chevron USA, Inc.

Robert Allen Long, Jr., Covington & Burling, L.L.P., Washington, DC, for American Petroleum Institute.

Appeal from the United States District Court for the Southern District of Mississippi.

Before DAVIS, STEWART and DENNIS, Circuit Judges.

DENNIS, Circuit Judge:

The plaintiffs, residents and owners of lands and property along the Mississippi Gulf coast, filed this putative class action in the district court against the named defendants, corporations that have principal offices in other states but are doing business in Mississippi. The plaintiffs allege that defendants' operation of energy, fossil fuels, and chemical industries in the United States caused the emission of greenhouse gasses that contributed to global warming, viz., the increase in global surface air and water temperatures, that in turn caused a rise in sea levels and added to the ferocity of Hurricane Katrina, which combined to destroy the plaintiffs' private property, as well as public property useful to them. The plaintiffs' putative class action asserts claims for compensatory and punitive damages based on Mississippi common-law actions of public and private nuisance, trespass, negligence, unjust enrichment, fraudulent misrepresentation and civil conspiracy. The plaintiffs invoked the district court's subject-matter jurisdiction based on diversity of citizenship.¹ The plaintiffs do not assert any federal or public law actions and do not seek injunctive relief.

Defendants moved to dismiss plaintiffs' claims on the grounds that the plaintiffs lack standing to assert their claims and that their claims present nonjusticiable political questions. The district court granted the motion and dismissed the claims.² The plaintiffs timely appealed. For the reasons discussed herein, we conclude that the plaintiffs have standing to assert their public and private nuisance, trespass, and negligence claims, and that none of these claims present nonjusticiable political questions; but we conclude that their unjust enrichment, fraudulent misrepresentation, and civil conspiracy claims must be dismissed for prudential standing reasons. Accordingly, we reverse the district court's judgment, dismiss the plaintiffs' suit in part, and remand the case to the district court for further proceedings.

I.

Plaintiffs' public and private nuisance claims assert that defendants intentionally and unreasonably used their property so as to produce massive amounts of greenhouse gasses and thereby injure both plaintiffs and the general public by contributing to global warming, which caused the sea level rise and added to the ferocity of Hurricane Katrina, the combined effects of which resulted in the destruction of plaintiffs' private property, as well as their loss of use of certain public property in the vicinity of their dwellings. Plaintiffs' trespass claim asserts that defendants' greenhouse gas emissions caused saltwater, debris, sediment, hazardous substances, and other materials to enter, remain on, and damage plaintiffs' property. Plaintiffs' negligence claim asserts that defendants have a duty to conduct their businesses so as to avoid unreasonably endangering the environment, public health, public and private property, and the citizens of Mississippi; that defendants breached this duty by emitting substantial quantities of greenhouse gasses; and that these emissions caused plaintiffs' lands and property to be destroyed or damaged.

Additionally, the plaintiffs' unjust enrichment claim asserts that certain defendants artificially inflated the price of petrochemicals, such as gasoline, diesel fuel, and natural gas, and realized profits to which they are not lawfully entitled and which, in part, rightfully belong to plaintiffs. Plaintiffs' civil conspiracy claim asserts that certain defendants were aware for many years of the dangers of greenhouse gas emissions, but they unlawfully disseminated misinformation about these dangers in furtherance of a civil conspiracy to decrease public awareness of the dangers of global warming. Finally, plaintiffs' fraudulent misrepresentation claim asserts that defendants knowingly made materially false statements in public relations campaigns to divert attention from the dangers of global warming, so as to dissuade government regulation, public discontent and consumer repulsion; that both government actors and the general public were unaware that these statements were false; that government officials and the general public acted upon defendants' statements; and that plaintiffs suffered injuries as a result of that reliance.

"The requirement that jurisdiction be established as a threshold matter `spring[s] from the nature and limits of the judicial power of the United States' and is `inflexible and without exception.'" Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 95, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998) (quoting Mansfield, C. & L.M.R. Co. v. Swan, 111 U.S. 379, 382, 4 S.Ct. 510, 28 L.Ed. 462 (1884)); see also Juidice v. Vail, 430 U.S. 327, 331, 97 S.Ct. 1211, 51 L.Ed.2d 376 (1977) ("[W]e are first obliged to examine the standing of appellees, as a matter of the case-or-controversy requirement associated with Art. III") "The standing inquiry is both plaintiff-specific and claim-specific. Thus, a reviewing court must determine whether each particular plaintiff is entitled to have a federal court adjudicate each particular claim that he asserts." Pagan v. Calderon, 448 F.3d 16, 26 (1st Cir.2006) (citing Allen v. Wright, 468 U.S. 737, 752, 104 S.Ct. 3315, 82 L.Ed.2d 556 (1984)).

Because this is a diversity case involving state common-law rights of action, plaintiffs must satisfy both state and federal standing requirements. See Mid-Hudson Catskill Rural Migrant Ministry, Inc. v. Fine Host Corp., 418 F.3d 168, 173 (2d Cir.2005) ("Where, as here, jurisdiction is predicated on diversity of citizenship, a plaintiff must have standing under both Article III of the Constitution and applicable state law in order to maintain a cause of action."); see also Metro. Exp. Services, Inc. v. City of Kansas City, 23 F.3d 1367, 1369-70 (8th Cir. 1994); City of Moore v Atchison, Topeka, & Santa Fe Ry. Co., 699 F.2d 507, 511 (10th Cir.1983); Owen of Georgia, Inc. v. Shelby County, 648 F.2d 1084, 1088-90 (6th Cir.1981); 13B Charles A. Wright, et al., Arthur R. Miller, Edward H. Cooper, Federal Practice & Procedure § 3531.14 n. 28 (3d ed.2009).

Plaintiffs' claims easily satisfy Mississippi's "liberal standing requirements." See Van Slyke v. Board of Trustees of State Institutions of Higher Learning, 613 So.2d 872, 875 (1993) ("Van Slyke II"). The Mississippi Constitution provides that "[a]ll courts shall be open; and every person for an injury done him in his lands, goods, person, or reputation, shall have remedy by due course of law, and right and...