‘Nightmare’ Fight in Coastal Big Oil Suits Reaches Supreme Court

Six Louisiana coastal parishes sued Big Oil over the erosion of coastal wetlands a decade ago, but they’re still fighting over what court should hear the case.

A judge who called the fight over jurisdiction “shameful” has since died and the parishes’ counsel complain that delays have impacted their ability to use certain aging expert witnesses.

The case will reach the Supreme Court on Monday, where the justices will hear arguments over whether Chevron USA Inc. can move a pair of disputes from state to federal court.

It could directly affect about a dozen matters, including the one case that went to trial and ended with a jury verdict ordering Chevron to pay $745 million towards restoring wetlands whose deterioration has made the region more vulnerable to extreme weather.

“It’s been a nightmare,” said Victor Marcello, a lawyer for a Baton Rouge-based firm that’s handled the suits on behalf of the parishes. “This hopefully will be the last time we have to argue this.”

The battle over jurisdiction speaks to the significance both sides have placed on the venue for trials with billions of dollars at stake.

Chevron, which argues its conduct isn’t responsible for land losses, in a December brief argued a federal forum was necessary due to the bias of local juries, where “every member stands to benefit from a windfall.”

The parishes, with backing from Republican-led Louisiana, say the cases target violations of a state coastal management law and belong in state courts.

42 Lawsuits

Central to the cases is the accusation that Chevron, Exxon Mobil Corp., BP, and others violated a state law by conducting certain operations without a permit after 1980, and that they must pay for any damage their oil production caused.

Six parishes in 2013 filed 42 nearly identical lawsuits against the industry.

The justices on Monday will consider a technical question. Chevron claims some disputes must be heard in federal court because the conduct charged dates back to World War II, when oil production was undertaken to fulfill federal contracts to refine aviation gas as part of the US war effort.

It’s at the least the third variation of a jurisdiction argument that defendants have raised.

The subsequent disputes contributed to delays that forced the parishes to hire new expert witnesses, after one died and others stepped away because of health problems or retirement, said John Carmouche, Marcello’s colleague who’s led the litigation.

The witnesses included a longtime expert on coastal zone regulations, as well as one who documented coastal erosion in Louisiana, Carmouche said.

The parishes’ complaints over the length of such jurisdiction fights found a receptive audience before one federal judge in the Eastern District of Louisiana.

Martin Leach-Cross Feldman, a Reagan appointee, said during an oral argument, “frankly, I think it’s kind of shameful,” before moving in January 2022 to remand a separate matter to state court.

A 2023 opinion from the US Court of Appeals for the Fifth Circuit quoting the comments noted Feldman didn’t mail a copy of the remand order before dying two weeks later.

‘Chasing Payouts’

The claims from Chevron and its defenders, which includes the Trump administration, are equally animated.

Critics of the lawsuits argue they are abusing the state courts system in cases with national implications, while targeting an industry Louisiana’s economy has long depended on. Critics have also taken issue with the Louisiana attorney general’s office’s move to give the parishes control of the litigation.

A friend-of-the-court brief submitted by former US Attorneys General William Barr and Michael Mukasey claimed trial lawyers “chasing vast payouts” were strategically bringing the cases in local courts “friendly” to the plaintiffs’ bar.

Chevron didn’t respond to a request for comment.

Marcello said the the coastal land loss lawsuits built off the firm’s work on “legacy litigation,” which refers to cases in Louisiana from landowners over past environmental damage caused by oil and gas operations.

Then-attorney general Jeff Landry, now Louisiana’s GOP governor, intervened early to support the action. But he allowed the firm, which reportedly donated to his gubernatorial campaign, to continue leading the matters.

The state’s solicitor general, Ben Aguiñaga, will handle arguments at the Supreme Court.

‘It’s Personal Now’

Chevron says its latest efforts stem from a “preliminary expert report” issued in 2018 that showed the parishes were attacking the petroleum industry’s activities going back to World War II.

The justices—two months after a jury entered a $745 million verdict in Plaquemines Parish—agreed to consider Chevron’s claims that it can move a civil action to federal court that relates to actions it undertook for federal officers.

Justice Samuel Alito just days before arguments pulled out of participating due to a financial stake in a company tied to the broader legal clash.

The US Court of Appeals for the Fifth Circuit previously rejected Chevron’s argument, because it failed to show its predecessors’ oil production in Louisiana was connected to its refining activities.

But courts generally have interpreted language in a 2011 amendment to the law to encompass a broad array of activity “related to” federal contracts, said University of Mississippi law professor E. Farish Percy.

That’s invited litigants like Chevron to invoke the statute, Percy said, “because they perceive the advantages as being great and there’s little risk.”

While Percy said a decision in favor of Chevron will have “widespread implications,” it’s not yet clear how far-reaching its impact will be in Louisiana. It will directly affect 11 cases, Marcello said, but he noted it could have spillover effects pushing jurisdiction fights even longer.

Carmouche, 57, said he’s not a “young buck” anymore, but he envisions litigating the cases well into the future.

“I’ll die in that freaking courtroom,” he said. “I know these documents like the back of my hand. They knew exactly what they were doing. Acted illegally, and it’s too personal now.”