What happened
The U.S. Supreme Court vacated a Fifth Circuit ruling and sent the case back after holding that Chevron USA Inc. plausibly connected a Louisiana coastal-damage suit to its World War II aviation-gasoline work for the federal government. Writing for the court, Justice Clarence Thomas said the case asked whether Chevron's wartime crude-oil production related to its federal avgas refining duties. "We hold that it does."
The decision gives Chevron another chance to keep the Plaquemines Parish suit in federal court under the federal officer removal statute, which allows removal of certain state-court actions against federal officers or people acting under them for or relating to acts under color of federal office. The court vacated the Fifth Circuit's decision and remanded the case.
The dispute arose from Plaquemines Parish's claims under Louisiana's State and Local Coastal Resources Management Act, which the opinion says prohibits certain coastal-zone uses, including oil production, without a permit while exempting uses legally begun before 1980. The parish's theory targeted wartime production practices including earthen pits, vertical drilling and canals, and Chevron removed the case by arguing those allegations related to federal avgas refining duties during the same period.
The Fifth Circuit agreed Chevron had acted under a federal officer as an avgas-refining contractor but held the suit was not for or relating to those acts because the federal contract did not specify how Chevron should acquire crude oil. The Supreme Court rejected that approach, saying the phrase relating to is broad but not limitless and requires a connection that is not tenuous, remote or peripheral.
The court reasoned that much of the crude oil Chevron produced in Plaquemines Parish was ultimately used for its own avgas refining and that the challenged wartime practices helped increase crude-oil production. The majority also rejected Louisiana's argument that removal required Chevron to have been acting under a federal officer when taking the specific production actions challenged in the suit, saying that would collapse separate elements of the removal test.
Justice Ketanji Brown Jackson concurred in the judgment, saying she and the majority interpreted the federal officer removal requirement differently but agreed Chevron satisfied it on these facts. She wrote that Chevron's federal contracts could be a but-for cause of the challenged crude-oil production without specifically directing that production.