City & County of Honolulu v. Sunoco LP

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On March 5, 2021, the court denied the companies’ motions to stay the remand order but delayed transmission of the order to the state courts for 10 days to allow the companies to seek relief in the Ninth Circuit.

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The federal district court for the District of Hawai‘i remanded the case brought by the City and County of Honolulu seeking to hold fossil fuel companies liable for climate change-related damages. The court rejected three grounds for federal jurisdiction because the Ninth Circuit rejected them in City of Oakland v. BP p.l.c., 969 F.3d 895 (9th Cir. 2020): (1) that the plaintiffs’ claims arose under federal common law; (2) that federal law preempted the claims; and (3) that the claims necessarily raised disputed and substantial federal issues (Grable jurisdiction). The court then concluded that because the plaintiffs elected to pursue claims based on the companies’ alleged concealment of the climate change risks of fossil fuels and not on the defendants’ extraction and production of fossil fuels, their claims did not relate to the companies’ activities on the Outer Continental Shelf, under the direction of federal officers, or on federal enclaves, and the companies therefore established no other basis for federal jurisdiction. With respect to federal-officer jurisdiction, the district court noted that this case was similar to County of San Mateo v. Chevron Corp. in which the Ninth Circuit affirmed a district court finding that the federal-officer removal statute did not provide jurisdiction. The Hawai‘i district court found that any additional evidence provided by the companies in these cases did not establish that the companies acted under a federal officer with respect to oil and gas leases, operation of a National Petroleum Reserve, or supplying to the strategic petroleum reserve; the court also found no causal connection between the plaintiffs’ concealment-based claims and actions the companies contended were taken at the direction of a federal officer. In addition, the court found that the companies made only conclusory assertions that colorable federal defenses existed.

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The District of Hawaii on September 9 declined to reconsider its order lifting the stay in the City and County of Honolulu’s case against fossil fuel companies. The district court rejected the companies’ contention that it should reconsider lifting the stay in light of the Ninth Circuit’s stay of the issuance of the mandate in County of San Mateo v. Chevron Corp. The District of Hawaii said it remained “unpersuaded that the contingent utility of a stay in this case outweighs proceeding in the normal course with, at the very least, Plaintiff’s anticipated motion to remand.”

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The defendants filed a request that the court reconsider its decision to lift the stay in light of Ninth Circuit’s stay of the mandate in County of San Mateo.

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