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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
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`Civil Action No.
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`STATE OF DELAWARE, ex rel.
`KATHLEEN JENNINGS, Attorney General of
`the State of Delaware,
`
`
`Plaintiff,
`
`v.
`
`BP AMERICA INC., BP P.L.C., CHEVRON
`CORPORATION,
`CHEVRON U.S.A. INC., CONOCOPHILLIPS,
`CONOCOPHILLIPS COMPANY, PHILLIPS
`66, PHILLIPS 66 COMPANY, EXXON
`MOBIL CORPORATION, EXXONMOBIL
`OIL CORPORATION, XTO ENERGY INC.,
`HESS CORPORATION, MARATHON OIL
`CORPORATION, MARATHON OIL
`COMPANY, MARATHON PETROLEUM
`CORPORATION, MARATHON
`PETROLEUM COMPANY LP, SPEEDWAY
`LLC, MURPHY OIL CORPORATION,
`MURPHY USA INC.,
`ROYAL DUTCH SHELL PLC, SHELL OIL
`COMPANY, CITGO PETROLEUM
`CORPORATION, TOTAL S.A., TOTAL
`SPECIALTIES USA INC., OCCIDENTAL
`PETROLEUM CORPORATION, DEVON
`ENERGY CORPORATION, APACHE
`CORPORATION, CNX RESOURCES
`CORPORATION, CONSOL ENERGY INC.,
`OVINTIV, INC., and AMERICAN
`PETROLEUM INSTITUTE,
`
`Defendants.
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 2 of 136 PageID #: 2
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`NOTICE OF REMOVAL
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`
`TO THE CLERK OF THE ABOVE-TITLED COURT AND TO PLAINTIFF THE STATE
`OF DELAWARE AND ITS COUNSEL OF RECORD:
`
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`PLEASE TAKE NOTICE THAT Defendants Chevron Corp. and Chevron U.S.A. Inc.
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`(collectively, “the Chevron Parties”) remove this action—with reservation of all defenses and
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`rights—from the Superior Court of Delaware, No. N20C-09-097 AML CCLD, to the United States
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`District Court for the District of Delaware, pursuant to 28 U.S.C. §§ 1331, 1332(d), 1367(a),
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`1441(a), 1442, and 1446, and 43 U.S.C. § 1349(b). All other defendants that have been joined and
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`served (collectively, “Defendants”) have consented to this Notice of Removal.
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`This Court has original federal question jurisdiction under 28 U.S.C. § 1331 because the
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`Complaint necessarily arises under federal laws and treaties and out of federal enclaves and presents
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`substantial federal questions as well as claims that are completely preempted by federal law.
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`Removal is also proper pursuant to the federal officer removal statute, 28 U.S.C. § 1442, as well as
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`28 U.S.C. §§ 1332(d), 1441(a) and 1446, and 43 U.S.C. § 1349(b). This Court has supplemental
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`jurisdiction under 28 U.S.C. § 1367(a) over any claims for which it does not have original federal
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`question jurisdiction because they form part of the same case or controversy as those claims over
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`which the Court has original jurisdiction.
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`ii
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 3 of 136 PageID #: 3
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`I.
`II.
`III.
`IV.
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`V.
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`VI.
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`IX.
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`X.
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`XI.
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`TABLE OF CONTENTS
`INTRODUCTION ................................................................................................................. 1
`TIMELINESS OF REMOVAL ........................................................................................... 19
`SUMMARY OF ALLEGATIONS AND GROUNDS FOR REMOVAL .......................... 20
`THIS COURT HAS FEDERAL-QUESTION JURISDICTION BECAUSE PLAINTIFF’S
`CLAIMS NECESSARILY ARISE UNDER FEDERAL LAW ......................................... 23
`THE ACTION IS REMOVABLE UNDER THE OUTER CONTINENTAL SHELF
`LANDS ACT ....................................................................................................................... 33
`THE ACTION IS REMOVABLE UNDER THE FEDERAL OFFICER REMOVAL
`STATUTE ........................................................................................................................... 39
`A.
`The Federal Officer Removal Statute Is Broad And Facts Must Be Construed In
`Favor of Removal .................................................................................................... 39
`Defendants Satisfy All Three Elements of the Federal Officer Removal Statute ... 40
`Defendants Acted Under Federal Officers .............................................................. 43
`1.
`Defendants Acted Under Federal Officers to Supply the Federal
`Government and the Nation With Oil and Gas to Ensure National Security
`and Economic Prosperity ............................................................................. 44
`Defendants Acted Under Federal Officers by Exploring For and Producing
`Oil and Gas on Federal Lands at the Government’s Direction to Implement
`Federal Policy Mandates and Objectives .................................................... 51
`Defendants Acted Under Federal Officers By Supplying Highly
`Specialized Fuels For Military Use ............................................................. 73
`Defendants’ Activities Are Related to Plaintiff’s Claims and Defendants Have
`Colorable Federal Defenses ..................................................................................... 85
`VII. THE ACTION IS REMOVABLE BECAUSE IT NECESSARILY RAISES DISPUTED
`AND SUBSTANTIAL FEDERAL ISSUES ....................................................................... 88
`VIII. THE ACTION IS REMOVABLE BECAUSE IT IS COMPLETELY PREEMPTED BY
`FEDERAL LAW ............................................................................................................... 107
`THIS ACTION IS REMOVABLE BECAUSE IT ARISES FROM ACTS ON MULTIPLE
`FEDERAL ENCLAVES ................................................................................................... 113
`THIS COURT HAS JURISDICTION UNDER THE CLASS ACTION FAIRNESS
`ACT ................................................................................................................................... 116
`PLAINTIFF’S CONCEALMENT ALLEGATIONS ARE IRRELEVANT AND BASED
`ON DEMONSTRABLY FALSE PREMISES .................................................................. 121
`XII. THIS COURT HAS JURISDICTION AND REMOVAL IS PROPER ........................... 132
`
`B.
`C.
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`D.
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`2.
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`3.
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`iii
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 4 of 136 PageID #: 4
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`I.
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`INTRODUCTION
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`For many decades, United States policy has expressly recognized the fundamental strategic
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`importance of oil and gas to the Nation’s economic well-being and national security. It is not an
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`accident that the United States Department of Defense is the single largest consumer of energy in
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`the United States and one of the world’s largest users of petroleum fuels. And when certain OPEC
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`countries embargoed oil sales to the United States in 1973–74, the U.S. Congress responded by,
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`among other things, creating the Strategic Petroleum Reserve to protect national energy and security
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`interests. See Energy Policy and Conservation Act of 1975, Pub. L. No. 94-163, 89 Stat. 871 (1975).
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`For similar reasons, Congress enacted the Naval Petroleum Reserves Production Act of 1976, Pub.
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`L. No. 94-258, 90 Stat. 303, 307–308 (1976), which “authorized and directed” that petroleum from
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`the federal petroleum reserve at Elk Hills, California—which Defendant Chevron Corp. had
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`operated for thirty-one years—“be produced at the maximum efficient rate for up to 6 years.”1
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`In fact, for vital security and economic reasons, every Administration since that of Franklin
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`D. Roosevelt has taken active steps to increase U.S. oil production, thereby securing our national
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`defense and spurring economic development that has led to the prosperity and standard of living
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`the United States has enjoyed over the past several decades. Despite the increased focus on
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`alternative sources of energy, petroleum remains the ineluctable backbone of United States energy
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`policy and it is undisputed that complete reliance on renewable energy sources at this time is neither
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`possible nor advantageous. For this reason, in 2010, President Obama “announc[ed] the expansion
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`of offshore oil and gas exploration—but in ways that balance the need to harness domestic energy
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` 1 See also Declaration of Joshua D. Dick (“Dick Decl.”), Ex. 2 (Steven Rattner, Long-Inactive
`Oilfield is Open—for Now, N.Y. Times (Oct. 31, 1977)); id. Ex. 3 (Robert Lindsey, Elk Hills
`Reserve Oil Will Flow Again, N.Y. Times (July 3, 1976)).
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`
`
`1
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 5 of 136 PageID #: 5
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`resources and the need to protect America’s natural resources.”2 President Obama explained that
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`it was “not a decision that I’ve made lightly. . . . But the bottom line is this: given our energy needs,
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`in order to sustain economic growth, produce jobs, and keep our businesses competitive, we’re
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`going to need to harness traditional sources of fuel even as we ramp up production of new sources
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`of renewable, homegrown energy.”3
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`Now, however, Plaintiff asks the court to find that this same petroleum production
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`contributes to, among other things, an unlawful “public nuisance” and “trespass” under Delaware
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`state law. Under various theories, the Complaint seeks to hold Defendants liable for the “extraction,
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`production, and consumption” of “oil, coal and natural gas,” which the Complaint refers to
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`collectively as “fossil fuel products.” Compl. ¶¶ 2, 5; see also id. ¶¶ 4, 6, 167, 170. Plaintiff asserts
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`that this subjects Defendants to “compensatory” and “punitive damages,” as well as “an order that
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`provides for abatement of the public nuisance [certain] Defendants have created” and that “enjoins”
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`those Defendants “from creating future common-law nuisances.” Compl. ¶ 263 (emphasis added);
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`id. at p. 217 (Prayer for Relief). In other words, the Complaint seeks to stop, or at least significantly
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`limit, the production and use of fossil fuels.
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`Plaintiff’s claims depend on Defendants’ production, distribution and/or sale of oil and gas
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`that create greenhouse gas emissions if and only if combusted by end users. Plaintiff does not—
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`and cannot—limit its claims to harms allegedly caused by fossil fuels extracted, produced,
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`distributed, sold, marketed, or used in Delaware. Instead, Plaintiff’s claims expressly target
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`Defendants’ nationwide and global activities, undertaken individually and together, as part of a
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`
` 2 Remarks on Energy at Andrews Air Force Base, Maryland,
`(Mar. 31, 2010),
`https://obamawhitehouse.archives.gov/the-press-office/remarks-president-energy-security-
`andrews-air-force-base-3312010.
` 3 Id.
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`
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`2
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`
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 6 of 136 PageID #: 6
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`“conspiracy.” Compl. ¶ 45(b). In fact, Plaintiff’s claims sweep even more broadly, depending
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`necessarily on the activities of billions of oil and gas consumers, including not only entities like the
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`U.S. government and military, but also countless hospitals, schools, manufacturing facilities, and
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`individual households around the world—indeed, virtually every inhabitant of the planet that uses
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`fossil fuels. Plaintiff itself is a prodigious consumer and user of fossil fuels, emitting thousands of
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`tons of CO2 through its own consumption alone.4 Yet, Plaintiff asks this Court to halt Defendants’
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`production of oil and gas by assessing massive monetary damages and entering an injunction.
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`The scope of this theory is breathtaking—it would reach the sale of oil and gas anywhere in
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`the world, including all past and otherwise lawful sales, such as sales to the federal government and
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`sales directed by the federal government. See, e.g., Compl. ¶ 60 (“Defendants’ conduct caused a
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`substantial proportion of global atmospheric greenhouse gas concentrations, and the attendant
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`historical, projected, and committed disruptions to the environment . . . associated therewith.”
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`(emphasis added)).5 And because Plaintiff challenges “production and combustion” over the past
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`several decades, the Complaint necessarily calls into question longstanding decisions by the federal
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`government regarding, among other things, national security, national energy policy, environmental
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`protection, the maintenance of a national strategic petroleum reserve program, development of
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`energy resources on the United States’ outer continental shelf lands, mineral extraction on federal
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`lands (which have produced billions of dollars in revenue for the federal government), and the
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`negotiation of international agreements bearing on the development and use of fossil fuels.
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`
` 4 See
`Markell,
`Jack
`Gov.
`84,
`No.
`Executive
`Order
`https://archivesfiles.delaware.gov/Executive-Orders/Markell/Markell_EO18.pdf.
` 5 See also, e.g., id. ¶ 52 (“The recent acceleration of fossil fuel emissions has led to a
`correspondingly sharp spike in atmospheric concentration of CO2.”); ¶ 4 (“This dramatic
`increase in atmospheric CO2 and other greenhouse gases is the main driver of the gravely
`dangerous changes occurring to the global climate.”).
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`2010,
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`
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`3
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`The federal issues and implications of Plaintiff’s Complaint and requests for relief demand
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`resolution by a federal court under federal law. The determination of how best to address global
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`climate change, and the balancing of the costs and benefits of the use of fossil fuels that goes into
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`that equation, has been and should continue to be made by the federal government through federal
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`policies and international cooperation. As the Ninth Circuit recently explained, “any effective plan
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`[to reduce greenhouse gas emissions] would necessarily require a host of complex policy decisions
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`entrusted . . . to the wisdom and discretion of the executive and legislative branches.” Juliana v.
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`United States, 947 F.3d 1159, 1171 (9th Cir. 2020). A patchwork of fifty different state-law
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`answers to this necessarily global issue would be unworkable and precluded under our federal
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`constitutional system. See North Carolina ex rel. Cooper v. TVA, 615 F.3d 291, 298 (4th Cir. 2010)
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`(“If courts across the nation were to use the vagaries” of state “public nuisance doctrine to overturn
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`the carefully enacted rules governing air-borne emissions, it would be increasingly difficult for
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`anyone to determine what standards govern.”).
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`As a consequence, the Complaint is removable to federal court on multiple grounds
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`including, without limitation: (1) federal question jurisdiction (28 U.S.C. §§ 1331, 1441(a)) because
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`Plaintiff’s claims “arise under” federal law; (2) jurisdiction under the Outer Continental Shelf Lands
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`Act (43 U.S.C. § 1349(b)); (3) jurisdiction under the Federal Officer Removal Statute (28 U.S.C.
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`§ 1442); (4) federal question jurisdiction because this action necessarily raises disputed and
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`substantial federal issues; (5) federal question jurisdiction because Plaintiff’s claims are completely
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`preempted by federal law; (6) federal enclaves jurisdiction because Plaintiff’s claims arise from
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`alleged acts on multiple federal enclaves; and (7) jurisdiction under the Class Action Fairness Act
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`(28 U.S.C. § 1332(d)).
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`Plaintiff’s claims arise under federal law. Plaintiff’s Complaint seeks to use state tort law
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`
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`4
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`to impose liability on Defendants for all of the future harms that Plaintiff alleges will be caused by
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`global warming. In the process, Plaintiff would effectively levy an unprecedented worldwide tax
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`on lawful productive conduct that has long been encouraged and regulated by Congress, states, and
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`foreign governments alike, and that remains essential to the health of the economy and the security,
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`stability, and economic interests of the United States. Though Plaintiff purports to assert its claims
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`under state law, the face of the Complaint reveals that the substance of those claims turns on long-
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`established federal policy, statutory, regulatory, and constitutional standards, issues, and
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`frameworks.
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` Supreme Court precedent dictates that claims based on alleged interstate or international
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`pollution fall into the narrow category of claims for which the structure of the U.S. Constitution
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`demands that “a federal rule of decision is ‘necessary to protect uniquely federal interests.’” Texas
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`Indus., Inc. v. Radcliff Materials, Inc., 451 U.S. 630, 640 (1981) (citation omitted). State law, by
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`its very nature, cannot apply, and the Supreme Court has held on at least three separate occasions
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`that an action for interstate air or water pollution necessarily arises under federal law and warrants
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`a federal court’s exercise of federal question jurisdiction under 28 U.S.C. § 1331. See Am. Elec.
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`Power Co. v. Connecticut, 564 U.S. 410 (2011) (“AEP”) (interstate and international effects of
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`greenhouse gas emissions); City of Milwaukee v. Illinois, 451 U.S. 304 (1981) (“Milwaukee II”)
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`(interstate water pollution); Illinois v. City of Milwaukee, 406 U.S. 91 (1972) (“Milwaukee I”)
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`(same). In the context of interstate pollution disputes, the Court has explained that “only a federal
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`common law basis can provide an adequate means for dealing with such claims.” Milwaukee I, 406
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`U.S. at 107 n.9 (citation omitted); see also International Paper Co. v. Ouellette, 479 U.S. 481, 488
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`(1987) (“[T]he regulation of interstate water pollution is a matter of federal, not state, law.”). Thus,
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`Plaintiff’s claims seeking relief for interstate greenhouse gas emissions necessarily “arise under”
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`5
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 9 of 136 PageID #: 9
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`federal law. Cf. 28 U.S.C. § 1441(c)(1)(A). The Complaint’s dependence on the navigable waters
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`of the United States reinforces that conclusion. Following these precedents, the Southern District
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`of New York held a lawsuit legally indistinguishable from this to be one “arising under” federal
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`law. See City of New York v. B.P. p.l.c., 325 F. Supp. 3d 466, 472 (S.D.N.Y. 2018) (“City of New
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`York”).
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`Plaintiff’s claims also necessarily arise under federal law because they seek to regulate the
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`production and sale of oil and gas abroad (where much of the alleged conduct underlying Plaintiff’s
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`claims necessarily occurred), and, therefore, implicate the federal government’s foreign affairs
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`power and the Constitution’s Foreign Commerce Clause. The federal government has exclusive
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`authority over the nation’s international policy on climate change and relations with foreign nations.
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`“Power over external affairs is not shared by the States; it is vested in the national government
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`exclusively.” United States v. Pink, 315 U.S. 203, 233 (1942). In the context of Plaintiff’s interstate
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`and international claims, therefore, “our federal system does not permit the controversy to be
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`resolved under state law,” “because the authority and duties of the United States as sovereign are
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`intimately involved” and “because the interstate [and] international nature of the controversy makes
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`it inappropriate for state law to control.” Texas Indus., 451 U.S. at 641. Because climate change
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`is an inherently global phenomenon—and is alleged to be so in the Complaint—any liability
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`imposed by state courts under state law would have global effects, undermining the federal
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`government’s foreign-policy prerogatives in an area where comprehensive international solutions
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`are paramount. Moreover, conflicts would inevitably arise were the courts of different states, each
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`applying its own state’s law, to impose conflicting standards on the same global conduct.
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`At bottom, this lawsuit implicates bedrock divisions of federal-state responsibility. Plaintiff
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`seeks to usurp, through what is styled as a set of state-law claims, the direction of federal policy in
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`6
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 10 of 136 PageID #: 10
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`core spheres of national security, nationwide economic development, and international relations.
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`Given the substantial and uniquely federal interests posed by climate change claims like these,
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`causes of action of the type asserted here necessarily arise exclusively under federal law.
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`Outer Continental Shelf Lands Act. In recent decades and continuing through the present,
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`a substantial portion of domestic exploration and production of oil and gas has occurred on the
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`Outer Continental Shelf (“OCS”), where the U.S. federal government is the exclusive holder of the
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`mineral rights and Congress granted federal courts exclusive jurisdiction. Certain Defendants and
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`their affiliates operate a large share of the more than 5,000 active oil and gas leases on nearly 27
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`million OCS acres administered by the U.S. Department of the Interior under the Outer Continental
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`Shelf Lands Act (“OCSLA”).6 Oil produced from the OCS has accounted for approximately 30%
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`of all domestic production, and the U.S. Treasury takes in more than $10 billion in average annual
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`revenues from OCS lease bonuses, rental payments, and royalties.7 Many of the Defendants in this
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`lawsuit and their alleged predecessors, successors, or subsidiaries worked to develop the oil and
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`gas resources on the OCS under federal government supervision.8 As such, Plaintiff’s claims
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`“aris[e] out of, or in connection with . . . any operation conducted on the” OCS, and therefore
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` 6 Statement of Abigail Ross Hopper, Director, Bureau of Ocean Energy Management, Before the
`House Committee on Natural Resources (Mar. 2, 2016), https://www.boem.gov/FY2017-
`Budget-Testimony-03-01-2016.
` 7 U.S. Dep’t of Interior, Bureau of Ocean Energy Management, OCS Oil and Gas Leasing
`Program: 2012-2017 Final Programmatic Environmental Impact Statement (“2012-2017
`EIS”), OCS EIS/EA BOEM 2012-030, 1-4 (2012).
` 8 The Complaint improperly conflates the activities of Defendants with the activities of their
`separately organized predecessors, subsidiaries, and affiliates. Although Defendants reject
`Plaintiff’s erroneous attempt to attribute the actions of predecessors, subsidiaries, and affiliates
`to the named Defendants, for purposes of this notice of removal only, Defendants describe the
`conduct of certain predecessors, subsidiaries, and affiliates of certain Defendants to show that
`the Plaintiff’s Complaint, as pleaded, can and should be removed to federal court.
`
`
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`
`
`7
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`
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 11 of 136 PageID #: 11
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`provide this Court with jurisdiction. 43 U.S.C. § 1349(b).
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`In 1953, Congress passed OCSLA to make these vital national oil and gas resources owned
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`by the federal government available for “expeditious and orderly development.” 43 U.S.C.
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`§ 1332(3). Responding to President Nixon’s direction to “increase the acreage leased on the Outer
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`Continental Shelf” to meet the federal government’s goal for energy independence from foreign oil
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`by 1980,9 Congress amended OCSLA to further encourage the leasing of the OCS to meet national
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`energy and security needs, while increasing federal control over lessees, to promote the national
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`energy agenda and protect the environment. The amendments were “intended to result in expedited
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`exploration and development of the Outer Continental Shelf in order to achieve national economic
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`and energy policy goals, assure national security, reduce dependence on foreign sources, and
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`maintain a favorable balance of payments in world trade.” California ex rel. Brown v. Watt, 668
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`F.2d 1290, 1296 (D.C. Cir. 1981) (quoting 43 U.S.C. § 1802).
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`Recognizing the substantial federal interests in the OCS leasing program, Congress granted
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`federal courts original jurisdiction “to the entire range of legal disputes that it knew would arise
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`relating to resource development on the Outer Continental Shelf.” Laredo Offshore Constructors,
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`Inc. v. Hunt Oil Co., 754 F.2d 1223, 1228 (5th Cir. 1985) (emphasis added). There can be no doubt
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`that Plaintiff’s alleged injuries, which the Complaint asserts are a result of Defendants’ “extraction,”
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`“production,” and “sale” of oil and gas, are directly connected to Defendants’ substantial operations
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`on the OCS. Compl. ¶¶ 2, 6, 93, 110, 127, 199, 258, 261, 267. Jurisdiction is also proper because
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`the relief sought by Plaintiff—including, but not limited to, enjoining Defendants’ production of
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`oil and gas—“threatens to impair the total recovery of the federally-owned minerals from the
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` 9 See Special Message to the Congress on the Energy Crisis, 1 Pub. Papers 29 (Jan. 23, 1974),
`https://quod.lib.umich.edu/p/ppotpus/4731948.1974.001?rgn=main;view=fulltext.
`
`
`
`8
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`
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 12 of 136 PageID #: 12
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`reservoir or reservoirs underlying the OCS.” Amoco Prod. Co. v. Sea Robin Pipeline Co., 844 F.2d
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`1202, 1210 (5th Cir. 1988). In any event, the Court must “‘credit [Defendants’] theory of the case
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`for purposes’ . . . of the removal inquiry,” K&D LLC v. Trump Old Post Office LLC, 951 F.3d 503,
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`506 (D.C. Cir. 2020) (quoting Jefferson Cnty. v. Acker, 527 U.S. 423 (1999)), and interpret OCSLA
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`broadly in favor of removal. See, e.g., Ten Taxpayer Citizens Grp. v. Cape Wind Assocs., LLC, 373
`
`F.3d 183, 188 (1st Cir. 2004) (OCSLA is “a sweeping assertion of federal supremacy over the
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`submerged lands outside of the three-mile SLA boundary”).
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`Federal Officer Removal. Defendants’ exploration and production of fossil fuels, including
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`production on the OCS and on federal lands, have been conducted substantially under the direction,
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`supervision, and control of officers of the federal government, and therefore this action is also
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`removable under the Federal Officer Removal Statute. 28 U.S.C. § 1442. Indeed, the leases the
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`government required Defendants to sign in order to produce oil and gas on the OCS include terms
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`and conditions that provide for continued federal oversight and mandate that Defendants develop
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`the leaseholds to achieve national energy objectives. These terms require Defendants to produce
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`oil and gas, control the methods of production, and direct how oil and gas are sold to benefit the
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`national economy. For example, the leases require Defendants to “maximize the ultimate recovery
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`of the hydrocarbons from the leased area”; require that drilling take place “in accordance with a
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`government approved exploration plan (EP), development and production plan (DPP) or
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`development operations coordination document (DOCD) [as well as] approval conditions”; and
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`specify that the federal government retains the right to oversee the lessee’s rate of production from
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`its leases.10
`
`
` 10 See generally Dick Decl. Exs. 5–8; Adam Vann, Congressional Research Service, RL33404,
`Framework
`(2018),
`Offshore
`Oil
`and
`Gas
`Development:
`Legal
`https://fas.org/sgp/crs/misc/RL33404.pdf (describing the multi-step process for approval of
`development plans and BOEM oversight procedures).
`
`
`
`9
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`
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 13 of 136 PageID #: 13
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`By producing oil and gas from the OCS, Defendants help the government meet national
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`interests, and—as President Obama emphasized in 2010—do so in the way that the federal
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`government has concluded best addresses national climate change objectives by balancing national
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`security, economic and environmental concerns. See supra note 2. Indeed, one of the first
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`undertakings of the newly created Federal Energy Administration in 1974 was to propose expanding
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`the OCS leasing program significantly: “Recent world events have spotlighted the growing
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`dependence of the United States on imported crude oil and petroleum products. Interruptions in oil
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`imports impose severe costs on the United States due to the pervasive economic role of petroleum
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`in almost every sector of the economy. . . . [T]he Outer Continental Shelf represents one of the
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`most important potential sources of increased domestic energy production, [and so] the President
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`has called for an accelerated leasing program as a mechanism to [e]nsure that the most favorable
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`OCS exploration prospects become available for near-term development.”11
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`It is significant that, to implement this direction, Congress considered creating a national oil
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`corporation to facilitate the development of oil and gas on the OCS, but ultimately decided that it
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`would be more efficient to contract with private energy companies, including many of the
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`Defendants here, to extract and produce oil and gas from these federal lands through a closely
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`monitored leasing program that would be supervised by the Department of the Interior and provide
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`the federal government with sufficient control over the production to protect national interests. See
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`Cong. Rec. S903-11 (Jan. 27, 1975). As the Supreme Court has explained, removal is appropriate
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`where, as here, private companies have “performed a job that, in the absence of a contract with a
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`private firm, the Government itself would have had to perform.” Watson v. Philip Morris Cos., 551
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`U.S. 142, 154 (2007).
`
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` 11 Dick Decl., Ex. 10 (H.R. Doc. No. 93-406, at App’x 2 (1974)).
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`
`
`10
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`
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 14 of 136 PageID #: 14
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`As noted above, the United States military needs oil and gas to be produced by Defendants
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`and other industry members to carry out its military purpose. For more than a century, “these
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`products [have been] used for the war effort . . . [as] many ‘ordinary’ products [are] crucial to the
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`national defense, such as . . . fuel and diesel oil used in the Navy’s ships; and lubricating oils used
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`for various military machines.” Exxon Mobil Corp. v. United States, 2020 WL 5573048, at *31
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`(S.D. Tex. Sept. 16, 2020) (emphasis added); see also id. at *47 (noting the “value of [the]
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`petroleum industry’s contribution to the nation’s military success”). The United States Department
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`of Defense is the country’s—and one of the world’s—single largest user(s) of petroleum fuels. In
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`fiscal year 2019 alone, the Department of Defense purchased 94.2 million barrels of petroleum in
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`compliance with military specifications, totaling $12.1 billion in procurement actions.12
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`Starting at least as early as World War II, officers of the federal government directed and
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`controlled Defendants’ production, extraction, and development of fossil fuel products as required
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`to meet the unprecedented demands generated by the nation’s military. Federal agencies that were
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`formed for the war effort, including the War Production Board (“WPB”) and the Petroleum
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`Administration for War (“PAW”), had the power to order the oil and gas industry to identify scarce
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`goods, prioritize their use, and facilitate gas production for the military. See United States v. Shell
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`Oil Co., 294 F.3d 1045, 1049 (9th Cir. 2002) (“Shell I”). “The government exerted substantial
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`control and direction over the refineries’ actions, including decisions on how to use raw materials
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`and labor.” Exxon Mobil, 2020 WL 5573048, at *1. In fact, the federal government “insiste[d] on
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`having the plants operate 24 hours a day, 7 days a week, year-round.” Id. at *8. Put simply, the
`
`
` 12 Def.
`(2019),
`Fact Book
`2019
`Fiscal Year
`Energy
`Logistics Agency
`https://www.dla.mil/Portals/104/Documents/Energy/Publications/FactBookFiscalYear2019_hi
`ghres.pdf?ver=2020-01-21-103755-473. This Fact Book also provides details of the types of
`fuels purchased by the military, the military standards governing the fuels purchased from
`Defendants, and the military’s research efforts related to petroleum fuels.
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`
`
`11
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`
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`Case 1:20-cv-01429-UNA Document 1 Filed 10/23/20 Page 15 of 136 PageID #: 15
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`federal government “exerted significant control over the operations of refinery owners or operators
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`that contracted to manufacture avgas, synthetic rubber, and other war materials.” Id. at *14. Certain
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`Defendants or their predecessors or subsidiaries also produced toluene, a component of the
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`explosive TNT, “under direct contract with the Army Ordnance Department.”13
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`In the decades after World War II, and continuing up to the present, the federal government
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`has repeatedly relied on energy companies, including Defendants, to increase domestic oil
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`production to bolster the nation’s military and economic security. For instance, in the 1970s, in the
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`midst of a series of national energy crises, Congress passe