A Vermilion Parish government lawsuit blaming wetlands loss on exploration canals and waste disposal pits left after decades of oil and gas drilling must be heard in state court, a federal magistrate in Lafayette has found.
The recommendation, which still needs backing from U.S. District Judge Shelly Dick, mirrors what federal judges in the Eastern District of Louisiana in New Orleans have already ruled in 28 similar lawsuits filed by Jefferson and Plaquemines parishes over wetlands loss in those and other coastal parishes.
Vermilion's and the other parishes' damages suits allege the oil and gas companies violated the state's Coastal Resources Management Act of 1978 when they failed to fill in canals dug for oil and gas exploration and failed to clean up oil waste pits. The law applies to areas in the state's coastal zone, a broad swath of south Louisiana that includes Vermilion Parish.
Vermilion is asking the court to have the defendants restore wetlands damaged from activities that were tied to 11 oil and gas fields and were subject to DNR permits.
Blake David, one of the plaintiffs' attorneys, said the recommendation really isn't a surprise and likely means the case will be tried before a jury at the Vermilion Parish Courthouse and not at the federal courthouse in Lafayette.
"It's basically just following the law from the beginning of time," David said Wednesday.
U.S. Magistrate Carol B. Whitehurst's recommendation does not address the merits of the lawsuit itself.
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Fifteenth Judicial District Attorney Keith Stutes filed the suit July 28, 2016, in state district court, but the defendants removed the case to U.S. District Court in Lafayette on Sept. 2, 2016. On June 30, Whitehurst signed her recommendation to send the suit back to state court.
Attorneys for the defendants have until July 14 to file objections. Attempts to reach the lead defense attorney on the case were unsuccessful Wednesday. Another lawyer referred calls to him.
In relying on the state coastal law rather federal regulations, Vermilion's suit takes a different legal tack than the higher-profile suit filed in 2013 by the Southeast Louisiana Flood Protection Authority-East.
While the levee board suit also attempted to address wetlands loss allegedly tied to oil and gas drilling, that suit relied on different state legal claims which a federal judge in New Orleans found raised federal law questions due to their broad scope. The judge dismissed that suit in 2015. In March, the levee board lost an appeal at the 5th U.S. Circuit Court of Appeals.
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Vermilion's suit specifically disavows claims under a variety of federal laws, but oil and gas companies, which want the suit heard in federal court, argue the suit still raises federal questions.
In a 40-page recommendation, Whitehurst details point-by-point why the oil and gas companies didn't meet muster in trying to keep the case in federal court. She points to the Vermilion case's reliance on state law to draw a distinction from the levee board case.
Among the companies' arguments, they claim the activities in Vermilion were related to drilling on the Outer Continental Shelf in the Gulf of Mexico, an area of federal jurisdiction. The oil and gas companies contend wetlands restoration being sought by the plaintiffs would alter the delivery of oil and gas from the Outer Continental Shelf to the land-based facilities.
Calling that theory "speculative," Whitehurst notes testimony from an LSU geologist and geographer in May who said wetlands restoration can complement production from the Outer Continental Shelf.
She also rejected oil companies' contention that the interconnections among onshore and offshore oil and gas operations necessarily bring in federal law. She quotes the district court in New Orleans, which found in the Plaquemines Parish case that such connections are "simply too remote and attenuated."
"Exercising jurisdiction in this manner would give federal courts jurisdiction over virtually any oil or gas dispute regardless of its relationship to OCS operations," Whitehurst wrote.
The 11 oil and gas fields raised in the Vermilion suit are Freshwater Bayou, North Freshwater Bayou, Intracoastal City, Buck Point, North Buck Point, Lac Blanc, Pecan Island, North Pecan Island, South Florence, West White Lake and Tigre Lagoon.