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Parish of Cameron v. Auster Oil & Gas Inc.

United States District Court, W.D. Louisiana, Lake Charles Division

January 17, 2018

PARISH OF CAMERON, ET AL.
v.
AUSTER OIL & GAS INC., ET AL.

          REPORT AND RECOMMENDATION

          KATHLEEN KAY UNITED STATES MAGISTRATE JUDGE

         Before the court are Motions to Remand [docs. 18, 27] filed by the Parish of Cameron (“Cameron, ” “the Parish”) and the State of Louisiana ex rel. Jeff Landry, Attorney General and through the Louisiana Department of Natural Resources, Office of Coastal Management, and Louisiana Department of Natural Resources Secretary, Thomas F. Harris (collectively, “the State”), respectively, in response to the Notice of Removal [doc. 1] filed by defendants Chevron USA Inc., Shell Offshore Inc., Chevron USA Holdings Inc., The Texas Company, Swepi LP, BP America Production Company, Shell Oil Company, Exxon Mobil Corp., and Chevron Pipe Line Company. Also before the court are Supplemental Motions to Remand [docs. 52, 54] filed by the Parish and the State, respectively, in response to the Supplemental Notice of Removal [doc. 33] filed by defendant Apache Corporation. Defendants oppose all motions to remand in this matter.

         These motions have been referred to the undersigned for review, report, and recommendation in accordance with the provisions of 28 U.S.C. § 636. For the reasons stated below, IT IS RECOMMENDED that the motions be GRANTED and that this matter be remanded to the 38th Judicial District Court, Cameron Parish, Louisiana. IT IS ALSO RECOMMENDED that the Motion to Schedule Oral Argument [doc. 82], Motion for Leave to File Notice of Supplemental Authority[1] [doc. 84], and Motion for Status Conference [doc. 85] be DENIED AS MOOT.

         I.

         Background

         This litigation arises from defendants' alleged violations of the Louisiana Coastal Resources Management Act of 1978, as amended, La. Rev. Stat. § 49:214.21 et seq. (“CZM Act”), and regulations and ordinances promulgated under that law (collectively, “CZM Laws”). Doc. 1, att. 2, pp. 1-2. CZM Laws regulate certain “uses” within the Louisiana coastal zone through a permitting system administered by the state Department of Natural Resources. See generally La. Rev. Stat. §§ 49:214.23, 214.25, 214.30.

         In this matter, the Parish alleges that defendants conducted oil and gas exploration, production, and transportation activities in Cameron Parish in violation of the CZM Laws that resulted in “substantial damage to land and waterbodies” located in the Cameron Parish Coastal Zone, as defined under the CZM Act. Doc. 1, att. 2, pp. 5-6, 9. Accordingly, they filed a suit for damages and remedies under the CZM Laws in the 38th Judicial District Court, Cameron Parish, Louisiana, on February 4, 2016.[2] Id. at 1-24. The State of Louisiana filed petitions in intervention, ex rel. Jeff Landry, Attorney General and through the Louisiana Department of Natural Resources, Office of Coastal Management, and its Secretary, Thomas F. Harris. Id. at 92-96, 105-12.

         Several defendants, named supra, filed a Notice of Removal to this court on April 21, 2016, and asserted that the Parish's claims are subject to admiralty jurisdiction and to federal jurisdiction under the Outer Continental Shelf Lands Act (“OCSLA”), 43 U.S.C. § 1349(b)(1). Doc. 1. Apache Corporation (“Apache”), which states that it was not served until May 2016, then filed a Supplemental Notice of Removal, asserting that the matter was also removable on the basis of federal question jurisdiction, 28 U.S.C. § 1331. Doc. 33.

         The Parish and the State filed motions to remand in response to both the original and supplemental notices of removal, supra. In those motions they contested all grounds for removal jurisdiction asserted. The State also argued that, under the Eleventh Amendment, it is “immune from removal against its will.” Doc. 27, att. 1, pp. 16-24. Additionally, the State and the Parish challenge the propriety of Apache's Supplemental Notice of Removal.[3] Doc. 52, att. 2, pp. 18-20.

         On August 25, 2016, this matter was stayed due to the pendency of an appeal of the Eastern District of Louisiana's decision in Board of Commissioners of the Southeast Louisiana Flood Protection Authority-East v. Tennessee Gas Pipeline Co. (“SLFPA I”), 29 F.Supp.3d 808 (E.D. La. 2014). Following the Fifth Circuit's decision (“SLFPA II”), 850 F.3d 714 (5th Cir. 2017), the stay was lifted and the parties submitted supplemental memoranda regarding the effect of that decision. Docs. 63-69. The matter is now ripe for decision.

         II.

         Legal Standard

         Federal courts are courts of limited jurisdiction, possessing “only that power authorized by Constitution and by statute.” Gunn v. Minton, 133 S.Ct. 1059, 1064 (2013) (quotation omitted). Generally, a defendant may remove a civil action originally filed in state court to federal court if the federal court has original jurisdiction over the action. 28 U.S.C. § 1441(a). The burden of establishing federal subject matter jurisdiction rests with the party seeking to invoke it. St. Paul Reinsur. Co., Ltd. v. Greenberg, 134 F.3d 1250, 1253 (5th Cir. 1998). Thus, a removing defendant bears that burden on a motion to remand. DeAguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995). Because of the limited nature of federal jurisdiction, removal statutes are construed strictly and in favor of remand. Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002).

         III.

         Analysis

         As noted supra, the original notice of removal asserted federal jurisdiction under the Outer Continental Shelf Lands Act (“OCSLA”) and pursuant to admiralty jurisdiction. In its supplemental notice of removal, Apache alleges federal question jurisdiction. The Parish and State oppose each basis of jurisdiction and challenge the propriety of Apache's supplemental notice of removal. The State also asserts that it is immune from removal against its will under the Eleventh Amendment.

         A. OCSLA Removal Jurisdiction

         The OCSLA contains an independent grant of original federal jurisdiction for

cases and controversies arising out of, or in connection with (A) any operation conducted on the outer Continental Shelf which involves exploration, development, or production of the minerals, of the subsoil and seabed of the outer Continental Shelf, or which involves rights to such minerals, or (B) the ...

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