The Supreme Court will wade into a thorny climate change debate next week as it takes up a lawsuit filed by a Louisiana parish against oil companies that the locality says have eroded its coastline through decades of fossil fuel activities.
The issue is limited. The justices are slated to decide whether the lawsuit can proceed in state court, which is likely to be more friendly to the parish’s claims, or whether the oil companies can force the case to be removed to federal court.
The underlying battle centers on whether Chevron and Exxon Mobil can be held liable under a 1978 Louisiana law for what Plaquemines Parish says is unrepaired environmental damage.
Billions of dollars are potentially at stake. A state jury last year awarded Plaquemines Parish more than $740 million in its lawsuit against Chevron. That ruling would be wiped out if the high court rules that the matter should have been heard in federal court.
The oil companies argue that this is where the case and another brought by Cameron Parish belong because Exxon and Chevron began their operations in Louisiana as contractors of the federal government during World War II.
That puts them under a federal law that allows challenges to federal officers and those acting under their orders to be sent to U.S. government courts, the companies say.
A district judge disagreed and found that the oil companies, while under contract with the federal government, weren’t acting “under” federal orders and that the oil extraction wasn’t part of the federal contracts the companies are citing.
The 5th U.S. Circuit Court of Appeals ruled that the district court was incorrect on the first question and that the companies were acting under orders.
The appeals court said the district judge was correct in ruling that Exxon’s and Chevron’s oil extraction wasn’t directly ordered by the companies’ federal contracts to supply aviation fuel to the government during World War II, so the federal removal law doesn’t apply.
Judge Andrew Oldham dissented from that ruling. He warned that facing a network of legal challenges in state courts could deter some companies from doing business with Uncle Sam.
Louisiana asserts that it has the right to enforce its own laws in state court.
“Federalism concerns weigh heavily in maintaining a state’s rights to enforce its own laws in its own courts,” the state argued in its filing.
With the case now at the high court, the Trump administration is supporting the oil companies.
“The close link between oil production and refining — as reflected in petitioners’ federal contracts and in the federal government’s supervision of the wartime oil industry more generally — establishes the requisite connection for removal,” the Justice Department said in its brief to the court.
The Washington Legal Foundation and the Atlantic Legal Foundation, which are advocacy organizations, also filed a brief in support of the energy giants.
They say the lower court’s ruling chills private-sector work with the federal government.
Two former senior military officers filed a brief expressing concern about the implications for wartime decision-making if the oil companies lose.
“Our nation can ill afford the division, confusion and uncertainty that would necessarily result if disputes arising from wartime decision-making were adjudicated in piecemeal fashion in various state courts,” retired Gen. Richard B. Myers and retired Adm. Mike Mullen said.
The Environmental Defense Fund said there’s no reason to think a case involving the production of airplane fuel 80 years ago would affect future war efforts.
“Allowing removal here would spark a tidal wave of removal by federal contractors,” the group argued.
Litigation has been continuing for more than a decade. Six parishes filed 42 lawsuits in 2013 over environmental damage.
The case is Chevron USA Inc. v. Plaquemines Parish.
• Alex Swoyer can be reached at aswoyer@washingtontimes.com.
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