City of Oakland v. BP PLC, 052620 FED9, 18-16663

Docket Nº:18-16663
Opinion Judge:IKUTA, CIRCUIT JUDGE:
Party Name:City of Oakland, a Municipal Corporation, and The People of the State of California, acting by and through the Oakland City Attorney; City and County of San Francisco, a Municipal Corporation, and The People of the State of California, acting by and through the San Francisco City Attorney Dennis J. Herrera, Plaintiffs-Appellants, v. BP PLC, a...
Attorney:Michael Rubin (argued), Barbara J. Chisholm, Rebecca Moryl Lee, and Corinne F. Johnson, Altshuler Berzon LLP, San Francisco, California; Victor M. Sher and Matthew K. Edling, Sher Edling LLP, San Francisco, California; Barbara J. Parker, City Attorney; Maria Bee, Special Counsel; Erin Bernstein, ...
Judge Panel:Before: Sandra S. Ikuta, Morgan Christen, and Kenneth K. Lee, Circuit Judges.
Case Date:May 26, 2020
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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City of Oakland, a Municipal Corporation, and The People of the State of California, acting by and through the Oakland City Attorney; City and County of San Francisco, a Municipal Corporation, and The People of the State of California, acting by and through the San Francisco City Attorney Dennis J. Herrera, Plaintiffs-Appellants,

v.

BP PLC, a public limited company of England and Wales; Chevron Corporation, a Delaware corporation; ConocoPhillips, a Delaware corporation; Exxon Mobil Corporation, a New Jersey corporation; Royal Dutch Shell PLC, a public limited company of England and Wales; Does, 1 through 10, Defendants-Appellees.

No. 18-16663

United States Court of Appeals, Ninth Circuit

May 26, 2020

Argued and Submitted February 5, 2020 Pasadena, California

Appeal from the United States District Court for the Northern District of California Nos. 3:17-cv-06011-WHA 3:17-cv-06012-WHA William Alsup, District Judge, Presiding

Michael Rubin (argued), Barbara J. Chisholm, Rebecca Moryl Lee, and Corinne F. Johnson, Altshuler Berzon LLP, San Francisco, California; Victor M. Sher and Matthew K. Edling, Sher Edling LLP, San Francisco, California; Barbara J. Parker, City Attorney; Maria Bee, Special Counsel; Erin Bernstein, Supervising Attorney; Malia McPherson, Deputy; Office of the City Attorney, Oakland, California; Dennis J. Herrera, City Attorney; Ronald P. Flynn, Chief Deputy; Yvonne R. Meré, Chief, Complex Litigation; Matthew D. Goldberg and Robb W. Kapla, Deputies; City Attorney's Office, San Francisco, California; for Plaintiffs-Appellants.

Theodore J. Boutrous, Jr. (argued), Andrea E. Neuman, and William E. Thomson, Gibson Dunn & Crutcher LLP, Los Angeles, California; Joshua S. Lipshutz, Gibson Dunn & Crutcher LLP, San Francisco, California; Neal S. Manne, Johnny W. Carter, Erica Harris, and Steven Shepard, Susman Godfrey LLP, Houston, Texas; Herbert J. Stern and Joel M. Silverstein, Stern & Kilcullen LLC, Florham Park, New Jersey; for Defendant-Appellee Chevron Corporation.

Kannon K. Shanmugam (argued), Paul Weiss Rifkind Wharton & Garrison LLP, Washington, D.C.; Theodore V. Wells Jr., Daniel J. Toal, and Jaren Janghorbani, Paul Weiss Rifkind Wharton & Garrison LLP, New York, New York; Jonathan W. Hughes, Arnold & Porter Kaye Scholer LLP, San Francisco, California; Matthew T. Heartney and John D. Lombardo, Arnold & Porter Kaye Scholer LLP, Los Angeles, California; Jameson R. Jones and Sean C. Grimsley, Bartlit Beck Herman Palenchar & Scott LLP, Denver, Colorado; Tracie J. Renfroe and Carol M. Wood, King & Spalding LLP, Houston, Texas; M. Randall Oppenheimer and Dawn Sestito, O'Melveny & Myers LLP, Los Angeles, California; Daniel B. Levin, Munger Tolles & Olson LLP, Los Angeles, California; Jerome C. Roth and Elizabeth A. Kim, Munger Tolles & Olson LLP, San Francisco, California; David C. Frederick and Brendan J. Crimmins, Kellogg Hansen Todd Figel & Frederick P.L.L.C., Washington, D.C.; for Defendants-Appellees BP PLC, ConocoPhillips, Exxon Mobil Corporation, and Royal Dutch Shell PLC.

Jonathan Brightbill (argued) and Eric Grant, Deputy Assistant Attorneys General; R. Justin Smith and Christine W. Ennis, Trial Attorneys; Environment and Natural Resources Division, United States Department of Justice, Washington, D.C.; for Amicus Curiae United States.

Michael Burger, Morningside Heights Legal Services, Inc., New York, New York, for Amici Curiae National League of Cities, U.S. Conference of Mayors, and International Municipal Lawyers Association.

Michael R. Lozeau and Richard T. Drury, Lozeau Drury LLP, Oakland, California, for Amici Curiae Conflict of Laws and Foreign Relations Law Scholars.

Gerson H. Smoger, Smoger & Associates P.C., Dallas, Texas; Robert S. Peck, Center for Constitutional Litigation P.C., Washington, D.C.; for Amici Curiae Senators Sheldon Whitehouse, Dianne Feinstein, Richard Blumenthal, Mazie K. Hirono, Edward J. Markey, and Kamala D. Harris.

Seth Davis, Berkeley, California; Ruthanne M. Deutsch and Hyland Hunt, Deutsch Hunt PLLC, Washington, D.C.; for Amici Curiae Legal Scholars.

John W. Keker, Matthew Werdegar, and Dan Jackson, Keker Van Nest & Peters LLP, San Francisco, California; Harold Hongju Koh and Conor Dwyer Reynolds, Rule of Law Clinic, Yale Law School, New Haven, Connecticut; for Amici Curiae Former U.S. Government Officials.

James R. Williams, County Counsel; Greta S. Hansen, Chief Assistant County Counsel; Laura S. Trice, Lead Deputy County Counsel; Tony LoPresti, Deputy County Counsel; Office of County Counsel, County of Santa Clara, San José, California; for Amicus Curiae California State Association of Counties.

Daniel P. Mensher and Alison S. Gaffney, Keller Rohrback L.L.P., Seattle, Washington, for Amici Curiae Robert Brulle, Center for Climate Integrity, Justin Farrell, Benjamin Franta, Stephan Lewandowsky, Naomi Oreskes, Geoffrey Supran, and Union of Concerned Scientists.

Kenneth L. Adams, Adams Holcomb LLP, Washington, D.C.; William A. Rossbach, Rossbach Law PC, Missoula, Montana; for Amici Curiae Mario J. Molina, Michael Oppenheimer, Bob Kopp, Friederike Otto, Susanne C. Moser, Donald J. Wuebbles, Gary Griggs, Peter C. Frumhoff, and Kristina Dahl.

Ian Fein, Natural Resources Defense Council, San Francisco, California; Peter Huffman, Natural Resources Defense Council, Washington, D.C.; for Amicus Curiae Natural Resources Defense Council.

Xavier Becerra, Attorney General; Sally Magnani, Senior Assistant Attorney General; David A. Zonana, Supervising Deputy Attorney General; Erin Ganahl and Heather Leslie, Deputy Attorneys General; Attorney General's Office, Sacramento, California; William Tong, Brian E. Frosh, Keith Ellison, Gurbir S. Grewal, Letitia James, Ellen F. Rosenblum; Peter F. Neronha, Thomas J. Donovan Jr., Robert W. Ferguson, and Karl A. Racine, Attorneys General; for Amici Curiae States of California, Connecticut, Maryland, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont, and Washington, and the District of Columbia.

Steven P. Lehotsky, Michael B. Schon, and Jonathan D. Urick, U.S. Chamber Litigation Center, Washington, D.C.; Peter D. Keisler, C. Frederick Beckner III, Ryan C. Morris, and Tobias S. Loss-Eaton, Sidley Austin LLP, Washington, D.C.; for Amicus Curiae Chamber of Commerce of the United States of America.

Corbin K. Barthold and Cory L. Andrews, Washington Legal Foundation, Washington, D.C., for Amicus Curiae Washington Legal Foundation.

Philip S. Goldberg and Christopher E. Appel, Shook Hardy & Bacon LLP, Washington, D.C.; Linda E. Kelly and Peter C. Tolsdorf, Manufacturers' Center for Legal Action, Washington, D.C.; for Amicus Curiae National Association of Manufacturers.

Curtis T. Hill, Jr., Attorney General; Thomas M. Fisher, Solicitor General; Kian J. Hudson, Deputy Solicitor General; Julia C. Payne and Robert Rowlett, Deputy Attorneys General; Office of the Attorney General, Indianapolis, Indiana; Steve Marshall, Kevin G. Clarkson, Leslie Rutledge, Christopher M. Carr, Derek Schmidt, Jeff Landry, Eric Schmitt, Tim Fox, Doug Peterson, Wayne Stenehjem, Dave Yost, Mike Hunter, Alan Wilson, Ken Paxton, Sean Reyes, Patrick Morrissey, and Bridget Hill, Attorneys General; for Amici Curiae States of Indiana, Alabama, Alaska, Arkansas, Georgia, Kansas, Louisiana, Missouri, Montana, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, Texas, Utah, West Virginia, and Wyoming.

Raymond A. Cardozo and David J. de Jesus, Reed Smith LLP, San Francisco, California; Richard A. Epstein, Chicago, Illinois; for Amici Curiae Professors Richard A. Epstein, Jason Scott Johnston, and Henry N. Butler.

Before: Sandra S. Ikuta, Morgan Christen, and Kenneth K. Lee, Circuit Judges.

SUMMARY

[*]

Removal/Subject-Matter Jurisdiction

The panel vacated the district court's judgment and order denying defendants' motion to remand cases to the state court from which they had been removed on the ground that plaintiffs' claim arose under federal law, and remanded for the district court to consider whether there was an alternative basis for subject-matter jurisdiction.

The City of Oakland and the City and County of San Francisco filed complaints in California state court asserting a California public-nuisance claim against five energy companies arising from the role of fossil fuel products in global warming. The complaints sought an order of abatement requiring the energy companies to fund a climate change adaptation program for the cities. The energy companies removed the complaints to federal court, identifying seven grounds for subject-matter jurisdiction, including that the cities' public-nuisance claim was governed by federal common law. The district court denied the cities' motion to remand the cases to state court, holding that it had federal-question jurisdiction under 28 U.S.C. § 1331 because the cities' claim was "necessarily governed by federal common law." The cities amended their complaints to include a federal nuisance claim. The district court dismissed for failure to state a claim, and it dismissed four defendants for lack of personal jurisdiction.

Considering the pleadings filed at the time of removal, the panel held that the state-law public-nuisance claim did not arise under federal law for purposes of § 1331. The panel explained that there is an exception to the well-pleaded complaint rule for a claim that arises under federal law because federal law is a necessary element of the claim. This exception applies when a federal issue is necessarily raised, actually disputed, substantial, and capable of resolution in federal court without disrupting the federal-state balance approved by Congress. The panel concluded that this exception did not apply because the state-law claim for public nuisance failed to raise...

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