Opinion ID: 2724
Heading Depth: 3
Heading Rank: 3

Heading: Alternative Grounds for Removal

Text: 46 Having concluded that the district court lacked jurisdiction over these actions under the federal officer removal statute or the bankruptcy removal statute, we now turn to the other bases for removal urged by the defendants, though rejected by the district court in MTBE V: preemption and federal question jurisdiction. We may affirm the denial of the motion to remand on either of those grounds, as [a]n appellate court is free to affirm a district court decision on any grounds for which there is a record sufficient to permit conclusions of law, even grounds not relied upon by the district court. Gmurzynska v. Hutton, 355 F.3d 206, 210 (2d Cir.2004) (internal quotation marks omitted). 47 As a preliminary matter, we note that preemption and federal question jurisdiction may apply only to the California action, not the New Hampshire action. Defs.' Br. at 58. In the New Hampshire action, unlike the California action, not every defendant consented to removal. Id. Because removal on the basis of preemption or a substantial federal question— unlike removal under the federal officer or bankruptcy removal statutes—requires the consent of all defendants, Chicago, Rock Island & Pac. R.R. Co. v. Martin, 178 U.S. 245, 247-48, 20 S.Ct. 854, 44 L.Ed. 1055 (1900); 14C Charles Alan Wright, Arthur R. Miller, & Edward H. Cooper, Federal Practice and Procedure § 3731, at 258 (3d ed.1998), only the California action is arguably capable of being removed on the grounds discussed below.
48 We begin by observing that the parties have largely ignored the issue of preemption in their papers to this court for the obvious reason that the case for preemption is weaker with respect to the California plaintiffs than it is with respect to perhaps any other plaintiffs. Many of the plaintiffs in MTBE V alleged that MTBE entered their groundwater as a result of being emitted from car tailpipes and falling back to the earth as rain. This allegation supports at least a colorable argument that those lawsuits are for the purposes of emission control, or at least so closely related to the issue of emission control that perhaps the applicable EPA regulations are of preemptive effect. See 42 U.S.C. § 7545(c)(4)(A) (preempting state regulation of fuel additives when for the purpose of motor vehicle emission control). Nevertheless, in this case, California does not appear to allege liability based on the release of MTBE through normal vehicle operations. Rather, it premises its theory of liability on leaks and discharges of MTBE from gasoline delivery systems into the state's groundwater, before it has seen the inside of a vehicle's gas tank. The defendants' own papers acknowledge the weakness of their argument. Specifically, in their opposition to the plaintiffs' motions for remand in two related cases, County of Nassau v. Amerada Hess Corp., No. 03-cv-9543 (S.D.N.Y. filed Dec. 2, 2003), and Water Authority of Western Nassau County v. Amerada Hess Corp., No. 03-cv-9544 (S.D.N.Y. filed Dec. 2, 2003), the defendants write: 49 That states and private parties have myriad other remedies, under both state and federal law, to address MTBE in groundwater—and, in particular, remedies against those who spill or leak MTBE gasoline —means that this Court need not be concerned that federal preemption interferes with the States' historical role in protecting health and safety. . . . Rather, reflecting that clean air and national supply of reasonably priced gasoline were overriding federal concerns, Congress and EPA preempted only in the narrow area of fuel design, while preserving participation in the federal administrative process and state remedies against those who spill gasoline. 50 Defs.' Opp'n to Pls.' Mot. to Remand at 29 (emphasis added). This statement recognizes that state-law remedies are available to address MTBE in groundwater—the very remedies pursued in this action. 51 In addition, for the reasons articulated in MTBE V, 341 F.Supp.2d at 403-11, we agree with Judge Scheindlin that the plaintiffs' claims are not completely preempted by federal law. Specifically, we agree with her conclusions that the EPA considered the preemptive effect of its regulations to be limited, id. at 406; that the agency intended its regulations to preempt nonidentical state controls in the context of fuel emissions, not in every conceivable area related to fuel and fuel additives, id. at 406-07; and that Congress did not intend to preempt state regulations unrelated to emissions control, id. at 408-09. We also agree with the conclusions of other courts that have found that similar claims were not preempted by the CAA. See, e.g., Oxygenated Fuels Ass'n v. Davis, 331 F.3d 665, 673 (9th Cir.2003); Oxygenated Fuels Ass'n v. Pataki, 158 F.Supp.2d 248, 257 & n. 4 (N.D.N.Y.2001). 52 We also note that, since oral argument was held in these cases, the district court has denied the defendants' motions for summary judgment on the related affirmative defense of conflict preemption. In re Methyl Tertiary Butyl Ether (MTBE) Prods. Liab. Litig., 457 F.Supp.2d 324 (S.D.N.Y.2006). Judge Scheindlin held that there was no conflict preemption, as [i]t was not physically impossible for defendant[s] to comply with both standards because, even if state tort law demands that defendants not use MTBE, the federal law did not require the use of MTBE. Id. at 335. Likewise, she held that there was no obstacle preemption, because the CAA amendments created a fuel-neutral program that could succeed even if tort liability were available for the use or misuse of MTBE. Id. at 335-43. While conflict preemption is a defense, not a basis for jurisdiction, this holding only reinforces the plaintiffs' argument that state tort law and the federal regulations at issue are compatible with one another.
53 For the reasons stated in Judge Scheindlin's opinion, we agree that the plaintiffs' claims do not raise a substantial federal question giving rise to federal subject matter jurisdiction. See MTBE V, 341 F.Supp.2d at 400-03. The plaintiffs' claims arise under and will be decided under state law, and although the defendants may refer to federal legislation by way of a defense, the jury's verdict will not necessarily turn on a construction of that federal law. As the Supreme Court noted in Merrell Dow Pharmaceuticals Inc. v. Thompson, 478 U.S. 804, 106 S.Ct. 3229, 92 L.Ed.2d 650 (1986), the mere presence of a federal issue in a state cause of action does not automatically confer federal-question jurisdiction. Id. at 813, 106 S.Ct. 3229. Indeed, words written by Justice Cardozo more than seventy years ago are equally applicable here: 54 The most one can say is that a question of federal law is lurking in the background, just as farther in the background there lurks a question of constitutional law, the question of state power in our federal form of government. A dispute so doubtful and conjectural, so far removed from plain necessity, is unavailing to extinguish the jurisdiction of the states. 55 Gully v. First Nat'l Bank, 299 U.S. 109, 117, 57 S.Ct. 96, 81 L.Ed. 70 (1936). 56 The California defendants also argue that in delegating to the EPA the authority to enact regulations requiring oxygenated fuels, Congress required the agency to give greater importance to clean air gains than to other potential environmental concerns. Defs.' Br. at 58 (citing 42 U.S.C. § 7545(k)(1)). They contend that plaintiffs' lawsuits, in seeking to privilege clean water at the expense of clean air, implicate these federal determinations and thus require the application of federal law. Id. at 59. This argument, however, presents a false dichotomy between clean air and clean water. That the defendants might use MTBE to meet fuel oxygenation requirements does not necessarily conflict with the state's goal of securing the safety of its water supply. Because the California complaint focuses on spills, leaks, and discharges of MTBE into groundwater, as well as alleged misrepresentations and omissions related to the safety of MTBE, they are entirely separate issues. A jury finding in favor of the plaintiffs would undermine neither Congress's intent in enacting the CAA amendments, nor the EPA regulations implementing them.