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Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 1 of 168 PageID: 1 STERN KILCULLEN & RUFOLO, LLC Herbert J. Stern [email protected] Joel M. Silverstein [email protected] 325 Columbia Turnpike, Suite 110 Florham Park, New Jersey 07932-0992 Telephone: 973.535.1900 Facsimile: 973.535.9664 GIBSON, DUNN & CRUTCHER LLP Theodore J. Boutrous, Jr., pro hac vice forthcoming [email protected] 333 South Grand Avenue Los Angeles, CA 90071 Telephone: 213.229.7000 Facsimile: 213.229.7520 Attorneys for Defendants Chevron Corp. and Chevron U.S.A. Inc. IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY CITY OF HOBOKEN Plaintiff, v. Civil Action No. 2:20-cv-14243 EXXON MOBIL CORP., EXXONMOBIL OIL CORP., ROYAL NOTICE OF REMOVAL DUTCH SHELL PLC, SHELL OIL COMPANY, BP P.L.C., BP AMERICA INC., CHEVRON CORP., CHEVRON U.S.A. INC., CONOCOPHILLIPS, CONOCOPHILLIPS COMPANY, PHILLIPS 66, PHILLIPS 66 Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 2 of 168 PageID: 2 COMPANY, AMERICAN PETROLEUM INSTITUTE, Defendants. TO THE CLERK OF THE ABOVE-TITLED COURT AND TO PLAINTIFF THE CITY OF HOBOKEN AND ITS COUNSEL OF RECORD: PLEASE TAKE NOTICE THAT Defendants Chevron Corp. and Chevron U.S.A. Inc. (collectively, “the Chevron Parties”) remove this action—with reservation of all defenses and rights—from the Superior Court of New Jersey, Law Division: Hudson County, No. HUD-L-003179-20, to the United States District Court for the District of New Jersey, pursuant to 28 U.S.C. §§ 1331, 1332(d), 1367(a), 1441(a), 1442, 1446, and 1367(a), and 43 U.S.C. § 1349(b). All other defendants that have been joined and served (collectively, “Defendants”) have consented to this Notice of Removal. This Court has original federal question jurisdiction under 28 U.S.C. § 1331 because the Complaint necessarily arises under federal laws and treaties and presents substantial federal questions as well as claims that are completely preempted by federal law. Removal is also proper pursuant to the federal officer removal statute, 28 U.S.C. § 1442, as well as 28 U.S.C. §§ 1332(d), 1441(a), and 1446, and 43 U.S.C. § 1349(b). This Court has supplemental jurisdiction under 28 U.S.C. § 1367(a) over any claims for which it does not have original federal question jurisdiction because ii Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 3 of 168 PageID: 3 they form part of the same case or controversy as those claims over which the Court has original jurisdiction. iii Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 4 of 168 PageID: 4 TABLE OF CONTENTS I. INTRODUCTION ............................................................................................ 1 II. TIMELINESS OF REMOVAL ...................................................................... 34 III. SUMMARY OF ALLEGATIONS AND GROUNDS FOR REMOVAL ..... 35 IV. THIS COURT HAS FEDERAL-QUESTION JURISDICTION BECAUSE PLAINTIFF’S CLAIMS NECESSARILY ARISE UNDER FEDERAL LAW ......................................................................................................................... 40 V. THE ACTION IS REMOVABLE UNDER THE OUTER CONTINENTAL SHELF LANDS ACT ..................................................................................... 52 VI. THE ACTION IS REMOVABLE UNDER THE FEDERAL OFFICER REMOVAL STATUTE .................................................................................. 60 VII. THE ACTION IS REMOVABLE BECAUSE IT NECESSARILY RAISES DISPUTED AND SUBSTANTIAL FEDERAL ISSUES ............................ 117 VIII. THE ACTION IS REMOVABLE BECAUSE IT IS COMPLETELY PREEMPTED BY FEDERAL LAW ........................................................... 142 IX. THIS ACTION IS REMOVABLE BECAUSE THIS CASE ARISES FROM ACTS ON MULTIPLE FEDERAL ENCLAVES ........................................ 150 X. THE ACTION IS REMOVABLE UNDER THE CLASS ACTION FAIRNESS ACT ........................................................................................... 154 XI. THIS COURT HAS JURISDICTION AND REMOVAL IS PROPER ...... 162 iv Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 5 of 168 PageID: 5 I. INTRODUCTION For many decades, United States policy has expressly recognized the fundamental strategic importance of oil and gas to the Nation’s economic well-being and national security. It is not an accident that the United States Department of Defense is the single largest consumer of energy in the United States and one of the world’s largest users of petroleum fuels. And when certain OPEC countries embargoed oil sales to the United States in 1973-74, the U.S. Congress responded by, among other things, creating the Strategic Petroleum Reserve to blunt the use of petroleum as a weapon. See Energy Policy and Conservation Act of 1975, Pub. L. No. 94-163, 89 Stat. 871 (1975). For similar reasons, Congress enacted the Naval Petroleum Reserves Production Act of 1976, Pub. L. No. 94-258, 90 Stat. 303, 307- 08 (1976), which “authorized and directed” that petroleum from the federal petroleum reserve at Elk Hills, California—which Defendant Chevron Corp. had operated for thirty-one years, developing and exploiting this capacity—“be produced at the maximum efficient rate for up to 6 years.”1 In fact, for vital security and economic reasons, every Administration since that of Franklin D. Roosevelt has taken active steps to increase U.S. oil production. While the alleged risks of global climate change have increased focus on alternative 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)). 1 Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 6 of 168 PageID: 6 sources of energy, petroleum remains the ineluctable backbone of United States energy policy. For this reason, in 2010, President Obama “announc[ed] the expansion of offshore oil and gas exploration—but in ways that balance the need to harness domestic energy resources and the need to protect America’s natural resources.”2 President Obama explained that it was “not a decision that I’ve made lightly. But the bottom line is this: given our energy needs, in order to sustain economic growth, produce jobs, and keep our businesses competitive, we’re going to need to harness traditional sources of fuel even as we ramp up production of new sources of renewable, homegrown energy.”3 Now, however, Plaintiff asks the court to find that this same petroleum production contributes to, among other things, an unlawful “public nuisance” and “trespass” under New Jersey state law. Under various theories, the Complaint seeks to hold Defendants liable for “extracting, producing, and selling more than 12% of the world’s fossil fuels since 1965.” Compl. ¶ 335; see also id. ¶¶ 291(e), 309(e), 339, 347, 350, 357, 362. Plaintiff asserts that this subjects Defendants to “compensatory, consequential and punitive damages,” as well as orders “compelling Defendants to abate the nuisance” and “preliminarily and permanently enjoining” them from conducting their lawful activities. Compl. at 144–45, Prayer for Relief. 2 Remarks on Energy at Andrews Air Force Base, Maryland, 2009 Daily Comp. Pres. Doc. 2 (Mar. 31, 2010), https://www.govinfo.gov/content/pkg/DCPD. 3 Id. 2 Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 7 of 168 PageID: 7 Plaintiff’s claims depend on Defendants’ production, distribution and/or sale of oil and gas that create greenhouse gas emissions if and only if combusted by end users. Plaintiff does not—and cannot—limit its claims to harms allegedly caused by oil and gas extracted, produced, distributed, sold, marketed, or used in New Jersey. Instead, Plaintiff’s claims expressly target Defendants’ nationwide and global activities. In fact, Plaintiff’s claims sweep even more broadly, depending necessarily on the activities of billions of oil and gas consumers, including not only entities like the U.S. government and military, but also countless hospitals, schools, manufacturing facilities, and individual households around the world. Indeed, Plaintiff itself is a prodigious consumer and user of fossil fuels, emitting thousands 4 of tons of CO2 through its own consumption alone. Yet, Plaintiff asks this Court to halt Defendants’ production of oil and gas by assessing massive monetary damages and entering an injunction. The scope of this theory is breathtaking—it would reach the sale of oil and gas anywhere in the world, including all past and otherwise lawful sales, including sales to the federal government. See, e.g., Compl. ¶ 32 (“Global production and combustion of fossil fuels is the central reason why the atmospheric concentration of 4 First Environment, Inc., Greenhouse Gas Emissions Inventory Government Operations City of Hoboken, New Jersey Activities Year 2017, 16–19, Apr. 2019, https://assets-global.website- files.com/58407e2ebca0e34c30a2d39c/5cbdc8711782057ff8e06626_FINAL_M unicipal%20GHG%20Report.pdf. 3 Case 2:20-cv-14243 Document 1 Filed 10/09/20 Page 8 of 168 PageID: 8 greenhouse gasses, prominently carbon dioxide (‘CO2’), has dramatically increased over the last fifty years. .” (emphasis added)).5 And because Plaintiff challenges “production and combustion” over the past several decades, the Complaint necessarily calls into question longstanding decisions by the federal government regarding, among other things, national security, national energy policy, environmental protection, the maintenance of a national strategic petroleum reserve program, development of energy resources on