Arco v. Dept of Health

Decision Date24 May 2000
Docket NumberNo. 99-36033,99-36033
Citation213 F.3d 1108
Parties(9th Cir. 2000) ARCO ENVIRONMENTAL REMEDIATION, L.L.C.,Plaintiff-Appellant, v. DEPARTMENT OF HEALTH AND ENVIRONMENTAL QUALITY OF THE STATE OF MONTANA; ENVIRONMENTAL PROTECTION AGENCY,Defendants-Appellees
CourtU.S. Court of Appeals — Ninth Circuit

[Copyrighted Material Omitted]

[Copyrighted Material Omitted] Kyle A. Gray, Holland & Hart, Billings, Montana, for the plaintiff-appellant.

Lisa E. Jones, United States Department of Justice, Washington, D.C., for the federal appellees.

Timothy R. Baker, Assistant Attorney General, Helena, Montana, for defendant-appellee State of Montana Department of Environmental Quality.

Appeal from the United States District Court for the District of Montana

Before: Harry Pregerson and Dorothy W. Nelson, Circuit Judges, and Barry Ted Moskowitz, 1 District Judge.

PREGERSON, Circuit Judge:

ARCO Environmental Remediation ("ARCO") brought this suit to obtain from the State of Montana documents pertaining to an environmental cleanup being conducted pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. S 9601 et seq, and to enjoin closed-door meetings between Montana and the federal Environmental Protection Agency ("EPA"). Filed in Montana state court, the complaint alleges causes of action under Montana law. We must decide the narrow question whether a federal district court has removal jurisdiction over this suit. We have appellate jurisdiction under 28 U.S.C. S 1291 and Concha v. London, 62 F.3d 1493, 1506 (9th Cir. 1995), and we review de novo the district court's decision denying remand. See Brennan v. Southwest Airlines Co., 134 F.3d 1405, 1409 (9th Cir.), amended by, 140 F.3d 849 (9th Cir. 1998). Because we find that the district court has no jurisdiction over this case, we reverse.

I

The Clark Fork River Operable Unit ("CFROU") is a Superfund site2 in Montana's Upper Clark Fork River Basin. CERCLA requires the EPA to determine, for each Superfund site, what is to be cleaned up, the extent of the cleanup, the costs of the cleanup, and how to apportion those costs. The EPA is in the process of preparing a Remedial Investigation/ Feasibility Study ("RI/FS") and an ecological risk assessment for the CFROU. The EPA has identified ARCO, plaintiff in this litigation, as a "Potentially Responsible Party" for the CFROU's contamination.3

The EPA and the State of Montana's Department of Health and Environmental Sciences ("DHES")4 signed a "Cooperative Agreement" under which Montana agreed to assist in the investigation of various Superfund sites, including the CFROU, in exchange for federal funding. In a "Memorandum of Agreement," the EPA and the DHES agreed to exchange information and documents pertaining to the Superfund sites. The Cooperative Agreement sets out the terms of public access to exchanged documents:

The State will allow public access to its records in accordance with applicable state law. EPA will allow public access to its records in accordance with the procedures established under the Freedom of Infor mation Act (PL 93-502), regulations promulgated pursuant thereto, and Agency guidance. Both parties agree to protect each other's claims for confidential ity, particularly with regard to documents related to pending or ongoing enforcement actions generated by either the State or EPA. The State will ask for EPA concurrence before releasing EPA documents.

The Memorandum of Agreement reiterates that the parties "agree to protect each other's claims for confidentiality and exemptions to public release of such exchanged information . . . ."

ARCO has made several attempts to gain access to documents pertaining to the CFROU Superfund site. In 1989, ARCO5 sued the DHES in Montana state court, seeking from Montana documents pertaining to the Clark Fork River Superfund Sites, including the CFROU. See State ex rel Atlantic Richfield Co. v. Department of Health and Envtl. Sciences of the State of Montana, No. CV 89-103-H-CCL. The DHES removed the action to federal court, and ARCO moved to remand. The district court denied the motion to remand, finding that ARCO had engaged in artful pleading to avoid stating a federal claim under CERCLA. Ultimately, ARCO and the DHES settled that action, and their joint stipulation was approved by court order on December 10, 1993. In that stipulation, ARCO agreed to "seek all documents in the possession of the state of Montana . . . relating to the four Upper Clark Fork River Superfund Sites" through discovery in CERCLA litigation pending before the United States District Court for the District of Montana.6

In October 1998, ARCO filed a request under the federal Freedom of Information Act ("FOIA"), 5 U.S.C. 552 et seq, for documents pertaining to a CERCLA-mandated ecological risk assessment for the CFROU Superfund site. The EPA and its FOIA officer denied the request. ARCO has not challenged the denial in federal court.

ARCO is also participating in an administrative proceeding before the Montana Board of Environmental Review which will determine water quality standards for the Clark Fork River.7 In this capacity, ARCO has sought without success to attend meetings between the EPA and Montana's Department of Environmental Quality ("DEQ") and to obtain the CERCLAmandated ecological risk assessment for the CFROU.

On June 10, 1999, ARCO filed this action against the DEQ in Montana state court. It did not name the EPA as a defendant. ARCO seeks preliminary and permanent injunctive relief ordering the DEQ to turn over documents pertaining to the CERCLA-mandated ecological risk assessment for the CFROU Superfund site. ARCO also seeks an order prohibiting closed-door consultation between employees and consultants of the EPA and the DEQ. ARCO asserts that this relief is mandated by Article II, Section 9 of the Montana Constitution, Montana's open meeting law, Mont. Code Ann.S 2-3201 et seq, and Montana's public access to records law, Mont. Code Ann. S 2-6-101 et seq. ARCO did not state a claim for relief under either CERCLA or the CERCLA Cooperative Agreement.

On June 25, 1999, the DEQ removed this case to federal court, asserting that ARCO's claims arise under CERCLA and that ARCO artfully pled a federal claim as a state claim. ARCO filed a motion to remand. The DEQ filed a motion under Rule 19 to join the EPA as a defendant. The district court denied the motion to remand on the ground that CERCLA preempted ARCO's state law claims. The district court also granted the DEQ's motion to join the EPA. ARCO voluntarily dismissed the case with prejudice and now appeals the district court's denial of its motion to remand.

II

Unless Congress expressly provides otherwise, a defendant may remove to federal court "any civil action brought in a State court of which the district courts of the United States have original jurisdiction . . ." 28 U.S.C. S 1441(a). If a case is improperly removed, the federal court must remand the action because it has no subject-matter jurisdiction to decide the case. See Rains v. Criterion Sys., Inc., 80 F.3d 339, 342 (9th Cir. 1996); Sparta Surgical Corp. v. National Ass'n of Sec. Dealers, Inc., 159 F.3d 1209, 1211 (9th Cir. 1998). We hold that the district court erred in denying ARCO's motion to remand. Because ARCO's claims do not arise under any federal law, this case does not fall within either the federal courts' federal question jurisdiction, see 28 U.S.C. S 1331, or the federal courts' exclusive original jurisdiction over controversies arising under CERCLA, see 42 U.S.C.S 9613(b). We also reject the DEQ's contention that the district court may exercise jurisdiction over this case in order to enforce its order in State ex rel Atlantic Richfield Co. v. Department of Health and Envtl. Sciences of the State of Montana.

A

As a general rule, "[t]he presence or absence of federalquestion jurisdiction is governed by the `well-pleaded complaint rule,' which provides that federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint." Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). "[A] case may not be removed to federal court on the basis of a federal defense, . . . even if the defense is anticipated in the plaintiff's complaint, and even if both parties admit that the defense is the only question truly at issue in the case." Franchise Tax Bd. of California v. Construction Laborers Vacation Trust for S. California, 463 U.S. 1, 14 (1983); see also Rivet v. Regions Bank of Louisiana, 522 U.S. 470, 478 (1998). Put simply, the existence of federal jurisdiction depends solely on the plaintiff's claims for relief and not on anticipated defenses to those claims.

On its face, ARCO's complaint does not state a claim that "arises under" federal law. Montana law creates the causes of action for access to public documents and meetings under which ARCO has chosen to seek relief. ARCO did not state a claim under CERCLA or the CERCLA Cooperative Agreement signed by the EPA and the DHES. The fact that ARCO's complaint makes repeated references to CERCLA does not mean that CERCLA creates the cause of action under which ARCO sues. See Easton v. Crossland Mortgage Corp., 114 F.3d 979, 982 (9th Cir. 1997); Rains, 80 F.3d at 343.

As the master of the complaint, a plaintiff may defeat removal by choosing not to plead independent federal claims. See Caterpillar, 482 U.S. at 399; Karembelas v. Hughes Aircraft Co., 992 F.2d 971, 975 (9th Cir. 1993). However, under the artful pleading rule "a plaintiff may not defeat removal by omitting to plead necessary federal questions in a complaint." Franchise Tax Bd., 463 U.S. at 22. A state-created cause of action can be deemed to arise under federal law (1) where federal law completely preempts state law, see Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64 (1987); ...

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