District of Columbia v. Exxon Mobil Corp.

Citing the “time honored well-pleaded complaint rule,” the D.C. Circuit Court of Appeals affirmed the remand to D.C. Superior Court of the District of Columbia’s lawsuit asserting that fossil fuel industry defendants violated the D.C. Consumer Protection Procedures Act by materially misrepresenting their products’ climate change effects. The D.C. Circuit first found that the “artful pleading” exception to the well-pleaded complaint rule did not apply, rejecting the defendants’ argument that D.C.’s claims necessarily arose under the federal common law of interstate air pollution. The D.C. Circuit also found that the Grable exception to the well-pleaded complaint rule—which provides for federal jurisdiction when a claim necessarily raises a substantial and actually disputed federal issue that is capable of resolution in a federal court without disrupting the federal-state balance—did not apply because no federal issue was necessarily raised. The court rejected the defendants’ contention a federal issue was necessarily raised because the consumer protection claim would contravene federal law affirmatively promoting fossil fuel use. The D.C. Circuit also held that removal was not authorized under the federal officer removal statute because D.C.’s lawsuit was not “for or relating to” actions taken by the defendants “under color of federal office,” whether those actions were production of aviation fuel and other essential military products, compliance with orders of the Petroleum Administration for Defense, or ongoing commercial relationships between the defendants and the federal government. In addition, the D.C. Circuit found that there was not jurisdiction under the Outer Continental Shelf Lands Act because D.C.’s misrepresentation claims did not “aris[e] out of” or “in connection with” the defendants’ operations on the Outer Continental Shelf.

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On December 20, 2022, the federal district court for the District of Columbia denied fossil fuel companies’ motion to stay execution of the court’s order remanding the District of Columbia’s lawsuit alleging that the companies violated D.C.’s consumer protection law by knowingly misrepresenting the effects of the companies’ products. The district court found that the companies did not establish irreparable harm with their arguments regarding the potential litigation burden and the risk that a final judgment by the D.C. Superior Court could render their “right to appeal hollow.”

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The District of Columbia Superior Court denied fossil fuel companies’ motions for reconsideration of the court’s April 21, 2025 orders denying their motions to dismiss the District of Columbia’s lawsuit alleging that they violated D.C.’s Consumer Protection Procedures Act (CPPA) by misleading consumers regarding the role of their products in causing climate change. First, the court rejected the arguments of the Shell, Exxon, and Chevron defendants that allegedly misleading statements they made about their products’ environmental benefits were indistinguishable from statements made by the BP defendants that the court found to be inactionable under the CPPA. Second, the court denied reconsideration to the Chevron defendants as to their argument that statements about a fuel additive that they stopped selling in the District more than 15 years earlier were immaterial as a matter of law. Third, the court rejected the BP defendants’ contention that the court erroneously concluded that natural gas was a good BP sold to D.C. consumers; the court said that even if it had conflated the direct sale of gasoline to D.C. consumers with sale of natural gas in D.C., the District of Columbia had sufficiently alleged “that BP paints itself as an environmental steward in order to sell goods” to those consumers. The court said its finding that the CPPA’s “goods and services” requirement was satisfied was not dependent on D.C. consumers’ purchase of natural gas.

The court denied the companies’ joint motion to certify the denials of the motions to dismiss for interlocutory appeal. The companies asked the court to certify three questions for appeal: (1) whether they could be held liable for the speech of trade associations under the CPPA and the First Amendment; (2) whether the First Amendment protected statements made as part of an alleged “campaign of denial”; and (3) whether they could be held liable under the CPPA for speech that does not concern consumer goods or services. The court said these questions did not present controlling questions of law but instead presented fact-intensive questions. The court also said that the defendants consistently misrepresented the court’s findings regarding the motions to dismiss because it had not reached legal conclusions but had merely found that the District’s allegations were sufficient to survive a motion to dismiss. The court also found that judicial economy was not a sufficient justification for interlocutory appeal.

The District of Columbia Superior Court allowed the District of Columbia to proceed with claims against fossil fuel companies under D.C.’s Consumer Protection Procedures Act (CPPA). The court issued four separate orders, one for each set of affiliated companies, with each order addressing the particular arguments made by a set of defendants. In its order on BP p.l.c. and BP American Inc.’s (BP defendants’) motion to dismiss, the court concluded that the District plausibly alleged that the defendant companies could be held liable for “climate-denialism” statements made by trade associations. Although the court found that the District stated greenwashing claims against the BP defendants, it said it would “not now decide whether the individual statements sufficiently relate to goods or services such that the CPPA applies.” The court disagreed with the BP defendants’ argument that because there was “common knowledge” of climate change’s risks, the alleged greenwashing statements could not mislead a reasonable consumer. The court did find, however, that the District did not state a facially plausible misrepresentation claim regarding the Invigorate fuel additive, though it rejected the BP defendants’ argument that the complaint did not sufficiently allege that its statements about natural gas were misleading. The court also found that the BP defendants’ omissions were actionable under the CPPA and found that the claims were not “in and of themselves First Amendment violations worthy of dismissal.” Because the court agreed with the District that it was not seeking relief for the physical effects of climate change, the court declined to consider the BP defendants’ arguments that D.C. law was preempted by the Clean Air Act or otherwise could not constitutionally apply.