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First Circuit Upholds Remand of Climate Change Suit To State Court

In State of Rhode Island v. Shell Oil Products Co., L.L.C. et al., No. 19-1818 (1st Cir. 2020), decided on October 29th, 2020, the First Circuit joined seven sister circuits in holding that the scope of appellate review of remand orders under 28 U.S.C. § 1447(d) is limited to the questions of federal-officer jurisdiction and civil rights jurisdiction. And while the holding does not break new ground in light of its consistency, it informs members of industry of the venue in which they will litigate climate change claims based in tort and state law providing environmental rights.

Underlying the Defendants’ appeal here are the State of Rhode Island’s allegations that members of the oil industry knew the effects of fossil fuels on the environment and proceeded to misleadingly market and sell those products. Rhode Island filed its suit in state court, seeking compensation from the Defendants through various state law claims including public nuisance, trespass, and products liability theories, for alleged climate change consequences like increased shoreline erosion and damage from storm surges.  The Defendants removed the case to federal court, Rhode Island objected, and the District Court remanded the case back to state court.   The Defendants then appealed the District Court’s grant of remand. 

Section 1447(d) of Title 28 of the United States Code provides,

An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1442 or 1443 of this title shall be reviewable by appeal or otherwise.

Central to the Defendants’ argument was that the scope of 28 U.S.C. § 1447(d) should be interpreted broadly so as to construe the word “order” in the secondary phrase to grant the Court jurisdiction to review the entire order if removal was based on section 1442 (which pertains to claims against federal officers) or 1443 (which pertains to civil rights cases) and other grounds. The First Circuit, however, rejected this argument in favor of the reasoning that §1447(d) serves as a general prohibition on the appellate review of remand orders with two limited exceptions. Those narrow exceptions being questions of federal-officer jurisdiction and civil rights jurisdiction.

The First Circuit also held that the Defendants failed to meet the federal-officer jurisdiction standard which requires defendants to show that they are “private actors acting under any federal officer, for any act under color of such office.” While contracts with the federal government relating to the production of oil may have a “flavor of federal officer involvement,” the First Circuit held that it is not sufficient to establish the requisite “nexus” between the allegations and actions taken at the direction of a federal officer. As a result, and because there was no civil rights issue, the First Circuit affirmed the district court’s decision to remand the case to State court without addressing any of the other bases for removal.

While, again, this case does not represent a departure from well established case-law, the opinion serves to inform future climate change litigation.