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Stern Represents Client Exxon Mobil, Argues for Energy Companies in Environmental Suit

7/3/2014

Adams and Reese Partner Martin Stern, who represents Exxon Mobil Corp., argued Wednesday on behalf of his client and all the energy companies involved in an environmental damages lawsuit in which a federal judge said that he won't rule until this fall on whether a Plaquemines Parish environmental damages lawsuit against 19 oil and gas companies should be heard in federal or state court.

A story on the lawsuit was published on Nola.com on July 2nd and in The Times-Picayune.

U.S. District Judge Jay Zainey told attorneys for the parish and the energy companies to submit written briefs under a schedule that will delay a decision until after Sept. 12, when a final brief is due. Zainey said at the start of the hearing that while he often rules from the bench after arguments, the suit against Total Petrochemicals & Refining USA, Inc. and 18 other companies is the first of 21 similar suits filed against energy companies by Plaquemines and another seven filed by Jefferson Parish. Zainey said that while three of the suits have been allocated to him, the remainder are being heard by several other Eastern District judges, who will be weighing how he rules in deciding what to do in their cases. As a result, he said, he plans to provide written reasons for his ruling, "and it will be up to the other judges if they choose to agree or disagree."

Victor Marcello, an attorney with Talbot, Marcello & Carmouche of Baton Rouge, represents Plaquemines Parish. Marcello argued that the parish used its authority under state law to file the suit as a representative of the state of Louisiana. Under federal law, a state is not a "citizen" of itself in determining whether there is diversity, so there should be no finding that diversity requires the case to be heard in federal court.

"Diversity does not turn on whether or not a statute says literally you can sue on behalf of the state. All you need is the statutory authority," Marcello said. "So the state is the real party," and the U.S. 5th Circuit Court of Appeals has made clear in other rulings that that means no diversity exists.

But Stern said the parish is suing as a local entity, which is considered a "citizen" under federal law, and thus diversity does exist. "They purported to sue in the state's name, but Attorney Gen. Buddy Caldwell is not here," Stern said. "The state doesn't feel like it's a party of interest and they're not arguing that the state is the actual part of interest."

Stern also argued that the parish doesn't have the authority to sue in the name of the state, arguing that the state laws cited in the parish's suit don't give the parish that authority.

Stern said bundling more than 1,100 alleged permit violations into a single suit was unfair. As an example, he said, the suit includes allegations about a pipeline and an individual well that are both 30 miles and decades apart.

The last argument was about the lawsuit's inclusion of energy company actions that occur on property that is part of the Delta National Wildlife Refuge. Stern argued that sale agreements showing the federal government bought much of the refuge land in 1937 shows that the land is a "federal enclave" as defined by the U.S. Constitution and thus federal courts should oversee lawsuits governing any actions taking place within their boundaries.

In addition to Total and Exxon Mobil, the other companies listed as defendants in the suit are BP America Production Co.; Burlington Resources Oil & Gas Co. LP; Chevron U.S.A. Inc.; Clayton Williams Energy Inc.; Delta Development Co. Inc.; Devon Energy Production Co. L.P.; Dimension Energy Co. L.L.C.; Pioneer Natural Resources USA Inc.; June Energy Inc.; Shell Offshore Inc.; Shell Oil Co.; Chevron U.S.A. Holdings Inc.; Texas Petroleum Investment Co.; Anadarko E&P Onshore LLC; Chevron Pipeline Co.; The Texas Co.; and LLOG Exploration & Production Co. L.L.C.