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Baltimore urges justices to keep Big Oil suit in state court

Baltimore urged the U.S. Supreme Court on Monday to turn aside Big Oil’s bid to have the city’s climate change lawsuit against the fossil fuel companies litigated in federal rather than state court.

In papers filed with the justices, Baltimore said a U.S. appeals court properly limited the bases for permitting the litigation to be in U.S. District Court rather than city circuit court. The 4th U.S. Circuit Court of Appeals correctly remanded the case to the state court because the companies had not shown the necessary element for federal jurisdiction: that they were acting at the direction of U.S. officials, the city’s outside counsel, Victor M. Sher, told the high court.

The city’s filing marks the latest volley in its lawsuit alleging the fossil-fuel companies concealed from and misinformed the public about the dangerous contributions their energy-generating activities made toward climate change. The lawsuit, filed two years ago in Baltimore City Circuit Court, seeks millions of dollars in damages for alleged violations of the Maryland Consumer Protection Act, as well as products liability, public nuisance and trespass.

The 21 companies, which are facing similar litigation in many other states, deny the allegations.

Baltimore’s Supreme Court filing came in response to the fossil fuel companies’ appeal of what they called the 4th Circuit’s too narrow standard for federal court jurisdiction over a lawsuit with national implications. In their bid for Supreme Court review, the companies argued that the litigation belongs in federal court because the city’s claim of environmental damage under Maryland law implicates the U.S. government’s role in regulating interstate emissions as evidenced by the federal Clean Air Act.

The high court has not said when it will vote on the companies’ request that it hear their appeal. The case is docketed at the Supreme Court as BP PLC et al v. Mayor and City Council of Baltimore, No. 19-1189.

The legal odyssey began when the companies sought to remove the city’s lawsuit to federal district court, where they believe they have a better chance for a pretrial victory than in state court.

U.S. District Judge Ellen L. Hollander remanded the case to Baltimore City Circuit Court in June 2019, saying the city’s state law claims did not implicate federal jurisdiction. The 4th Circuit upheld the remand, ruling in March that the companies had not shown they acted at the direction of a federal officer.

In their petition for review, the companies told the justices that U.S. appeals courts are divided on whether their review of remand decisions such as Hollander’s is limited to instances when the defendant seeking federal jurisdiction was acting at a federal officer’s direction.

The Chicago-based 7th U.S. Circuit Court of Appeals, for example, said appellate courts can review all the reasons given for federal jurisdiction, not just the federal-officer removal standard, wrote Kannon K. Shanmugam, the companies’ counsel of record before the high court.

“The circuit conflict on the question presented is clear, and it warrants the (Supreme) Court’s review in this case,” wrote Shanmugam, of Paul, Weiss, Rifkind, Wharton & Garrison LLP in Washington.

“The question is also of substantial legal and practical importance; indeed, the question is currently arising with acute frequency in climate change lawsuits similar to this one, where the arguments for federal jurisdiction are compelling,” Shanmugam added. “This case is an optimal vehicle for consideration of that important question.”

Baltimore, in its request that the high court deny the petition for review, said the 4th Circuit’s decision was in keeping with federal law, which strictly limits appellate review of U.S. district court decisions that a case does not belong in federal court.

“(T)he 4th Circuit’s interpretation of (federal law), shared by almost every circuit to address the issue, is consistent with the statutory text and strict limitations Congress has historically placed on remand orders,” wrote Sher, of Sher Edling LLP in San Francisco. “The only exceptions Congress has carved out from the otherwise absolute statutory bar on appellate review, outside of the class action context, are for removals based on the federal civil-rights removal statute and the federal-officer removal statute.”

The companies being sued by Baltimore include BP America Inc., Chevron Corp., CITGO Petroleum Corp., ConocoPhillips Co., Exxon Mobil Corp.; Hess Corp., Marathon Petroleum Corp., Phillips 66 and Shell Oil Co.

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