On May 17, 2021, the Supreme Court vacated an appellate court decision which had remanded to state court an action seeking to hold petroleum companies liable for the effects of climate change, finding that the appellate court impermissibly restricted the scope of its review of a district court’s order. Although, as noted by the Supreme Court, “[t]he only question before us is one of civil procedure,” the case of BP P.L.C. v. Mayor and City Council of Baltimore, Docket No. 19-1189 (May 17, 2021) may have a profound practical impact on ongoing environmental litigation.

In the underlying case, the Mayor and City Council of Baltimore (“Baltimore”) sued various energy companies (“defendants”), alleging that the companies had promoted the use of fossil fuels while concealing the detrimental impacts of those fossil fuels. Baltimore’s Complaint included a number of different state-law causes of action, but primarily centered around the claim that it was harmed by the defendants’ alleged failure to warn about the dangers of fossil fuels. This case is but one of many ongoing cases involving city and/or state governments suing energy companies for their alleged concealment of the alleged dangers of fossil fuels.

Baltimore filed its Complaint in state court. The defendants then removed the case to federal court, asserting that removal was proper pursuant to numerous grounds, including: the federal officer removal statute, 28 U.S.C. § 1442 (a)(1); the federal question statute, 28 U.S.C. § 1331; the admiralty jurisdiction statute, 28 U.S.C. § 1333; the Outer Continental Shelf Lands Act, 43 U.S.C. § 1349(b); and the bankruptcy removal statute, 28 U.S.C. § 1452. After the defendants removed the case to federal court, Baltimore filed a motion seeking to have the district court remand the case back to state court. Baltimore maintained that none of the defendants’ asserted justifications for removal were applicable. The district court agreed, issuing an extensive order remanding the case back to state court. In its order, the court evaluated each of the defendants’ asserted bases for removal and ultimately concluded that removal was not warranted by any.

28 U.S.C. § 1447(d) states -

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.

Consequently, parties normally cannot appeal remand orders. However, as an exception to the normal rule, the statute permits parties to appeal remand orders when the case was originally removed pursuant to section 1442 (the federal officer removal statute), or section 1443 (the civil rights removal statute). In this case, as noted previously, the defendants asserted numerous grounds for removal, including, importantly, section 1442 (the federal officer removal statute), arguing that removal was justified under this statute because the defendants’ “exploration, drilling, and production operations took place at the federal government’s behest.” Thus, it was under the exception to section 1447 that the defendants then appealed the district court’s remand order.

As a predicate to its ultimate decision, the Fourth Circuit was confronted by the procedural question that the Supreme Court ultimately decided: “Does 28 U.S.C. § 1447(d) permit a court of appeals to review any issue in a district court order remanding a case to state court where the defendant premised removal in part on the federal officer removal statute, § 1442, or the civil rights removal statute, § 1443?” The Fourth Circuit held that its review of the remand order was limited solely to whether removal was warranted under the federal officer removal statute, § 1442, and did not review whether the district court’s remand order pertaining to the other bases for removal was correct. Finding that the district court’s decision on that narrow issue was correct, the Fourth Circuit affirmed the remand to state court.

The Supreme Court held that the Fourth Circuit erred by not reviewing all grounds for removal that the district court addressed, basing its decision on the plain language of 28 U.S.C. § 1447(d), “[w]hen called on to interpret a statute, this Court generally seeks to discern and apply the ordinary meaning of its terms at the time of their adoption.” Here, 28 U.S.C. § 1447(d) provides that “an order remanding a case to the State court from which it was removed pursuant to section 1442 … of this title shall be reviewable by appeal or otherwise.” (emphasis added). The appealed district court order had evaluated all asserted grounds for removal. Consequently, the Supreme Court held that the Fourth Circuit should have reviewed the entirety of the order, because the statute allows the party to appeal the “order,” not just the portion of the order pertaining to the federal officer removal statute. As a result, the Supreme Court vacated the Fourth Circuit’s decision and instructed the Fourth Circuit to evaluate all of the defendants’ asserted grounds for removal.

The practical effects of this decision could be profound, as energy companies generally seek to have federal courts adjudicate these disputes; whereas, plaintiffs generally seek to litigate in state court. Indeed, as a result of its ruling in the Baltimore case, on May 24, 2021, the Supreme Court vacated similar decisions from the First, Ninth, and Tenth circuits, requiring those courts to also review all asserted grounds for removal.

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