Avitts v. Amoco Production Co.

Brief Fact Summary.

Plaintiffs filed suit in state court against Defendants to recover money for property damage caused by Defendants who were allegedly in violation of state and federal law. Defendants removed the case to federal court based on Plaintiffs mere reference to federal law.

Synopsis of Rule of Law.

A defendant may remove any action brought in state court only if the federal court has original jurisdiction over the matter.

Facts.

Avitts (Plaintiffs) filed suit in Texas state district court against Amoco Production Co. and other oil companies (Defendants) to recover money damages for property damage caused by Defendants’ oil and gas operations. Since Plaintiffs’ complaint stated that the damages caused by Defendants were “in violation of not only State law but also Federal law,” the matter was removed to federal court in the Southern District of Texas. Although Plaintiffs’ complaint referenced federal law, Plaintiffs failed to state a cause of action under federal law by not specifying which federal laws Defendants had violated.

With a notice of removal, Defendants also filed a motion for a more definite statement under 12(e) of the Federal Rules of Civil Procedure. After the district court denied Defendant’s motion for a more definite statement, Plaintiffs filed an amended complaint but failed to state a federal question. Despite several amended complaints, Plaintiffs’ complaints never conferred federal jurisdiction. Plaintiffs did reference the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and the Oil Pollution Act of 1990 (OPA) in the Joint Pretrail Order (PTO) as a means to calculate the measure of damages owed to Plaintiffs; however, Plaintiffs failed to raise such causes of action in any of Plaintiffs’ complaints.

After the district court entered interim orders requiring Defendants to complete an environmental study and to pay around $650,000 in interim costs and attorney’s fees, Defendants appealed to the United States Court of Appeals for the Fifth Circuit on a consolidated appeal.

Issue.

Will a federal court have original jurisdiction over a claim that merely references federal law if a defendant removes the case from state court based on such a reference?

Held.

No. A federal court will not have original jurisdiction over a claim that merely references federal law. In this case, Plaintiffs mere reference to federal law without an actual claim based on a specific federal law was insufficient to confer federal question jurisdiction. Although Plaintiffs referenced CERCLA and OPA in an Order, this reference was not asserted in any of Plaintiffs’ complaints. Therefore, the district court lacked subject matter jurisdiction over the matter and removal was improper. As such, The United States Court of Appeals for the Fifth Circuit remanded the case back to state court from federal court pursuant to 28 U.S.C. § 1441(c).

Discussion.

As per 28 U.S.C. § 1441(a), a defendant may remove any action brought in state court only if the federal court has original jurisdiction over the matter. This original jurisdiction must arise from a plaintiff’s complaint. If the federal court does not have original jurisdiction in the matter and the case was improperly removed to federal court, then the case must be remanded to state court.