State of Minnesota v. American Petroleum Institute, No. 21-1752 (8th Cir. 2023)Annotate this Case
Minnesota sued a litany of fossil fuel producers1 (together, the Energy Companies) in state court for common law fraud and violations of Minnesota’s consumer protection statutes. In doing so, it joined the growing list of states and municipalities trying to hold fossil fuel producers responsible for alleged misrepresentations about the effects fossil fuels have had on the environment. The Energy Companies removed to federal court. The district court granted Minnesota’s motion to remand, and the Energy Companies appealed.
The Eighth Circuit affirmed. The court held that Congress has not acted to displace the state-law claims, and federal common law does not supply a substitute cause of action, the state-law claims are not completely preempted. The court reasoned that because the “necessarily raised” element is not satisfied, the Grable exception to the well-pleaded complaint rule does not apply to Minnesota’s claims. Further, the court wrote that the connection between the Energy Companies’ marketing activities and their OCS operations is even more attenuated. Thus, neither requirement is met, there is no federal jurisdiction under Section 1349.
Court Description: [Kobes, Author, with Grasz and Stras, Circuit Judges] Civil case - Civil Procedure. The State sued petroleum producers alleging causes of action for fraud and violation of Minnesota consumer protection laws based on allegations that the defendants misrepresented the effects fossil fuels have on the environment; the defendants removed the case to federal court under the general removal statute and the federal officer removal statute, but the district court remanded the case to state court for lack of original jurisdiction and because the claims did not have sufficient connection to the companies' purported federally directed activities; the companies appeal, contending the case is removable. The state law claims are not completely preempted; because federal law is not a necessary element of any of the State's claims, the complaint does not necessarily raise a federal issue, and the Grable & Sons Metal Prods., Inc v. Darue Eng'g & Mfg., 545 U.S. 308 (2005) exception to the well-pleaded complaint rule does not apply; federal question jurisdiction does not exist under the Outer Continental Shelf Lands Act; the district court did not err in determining the case was not removable under the federal officer removal statute; the Class Action Fairness Act does not provide a basis for removal, and the petition for permission to appeal in case 21-8005 is denied. Judge Stras, concurring.