District of Columbia v. Exxon Mobil Corp.

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 federal district court for the District of Columbia granted the District of Columbia’s motion to remand to D.C. Superior Court a lawsuit alleging that energy companies violated D.C.’s consumer protection law by knowingly misrepresenting the effects of fossil fuel products. The court first found that the companies failed to show that federal common law should apply to D.C.’s claims. The court reasoned that even assuming that D.C.’s claims implicated “uniquely federal” interests (e.g., interstate pollution, navigable waters of the United States, and foreign affairs), the companies did not show a “significant conflict” between those interests and D.C.’s claims. The court further found that even if federal common law applied, the well-pleaded complaint rule would bar federal jurisdiction, rejecting the suggestion that the doctrine of complete preemption provided an exception to the well-pleaded complaint rule in this case. The court noted that the Supreme Court has only recognized complete preemption in the context of federal statutes, not federal common law. The court next found that the defendants did not establish that the Grable exception to the well-pleaded complaint rule applied because the defendants failed to identify a disputed federal issue that was necessary to resolve D.C.'s consumer protection claims. The court also found that federal enclave jurisdiction did not apply and that removal was improper under the Outer Continental Shelf Lands Act’s (OCSLA’s) broad jurisdictional grant because the alleged false advertising and misleading information campaigns were not “operation[s]” under OCSLA and because activities on the outer Continental Shelf were not shown to be the but-for cause of D.C.’s injuries. In addition, the court found that federal-officer removal did not apply because even if the defendants acted under the federal government’s direction in their development of fossil fuel products, there was not a nexus between D.C.’s claims and the asserted federal authority. The court also rejected arguments that there was diversity jurisdiction or jurisdiction under the Class Action Fairness Act.

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The District of Columbia argued that the Second Circuit’s opinion addressed a different issue than the issue before the court; that the Second Circuit expressly distinguished the “fleet” of climate cases in which federal courts had granted remand; and that D.C.’s case would be distinguishable in any event because it was based on a statutory consumer protection claim.

Fossil fuel company defendants filed notices about the Second Circuit's decision affirming dismissal of New York City's climate change case in cases where motions to remand are pending, including in cases brought by the District of Columbia, City of Hoboken, City of Oakland, and City and County of San Francisco. The defendants argued that the Second Circuit’s decision confirmed that the plaintiff’s claims necessarily arise under federal law.

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