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United States District Court, S.D. New York

October 19, 2004.

Amerada Hess Corp., et al., No. 04 Civ. 4976 (SAS). The People of the State of California, et al. v. Atlantic Richfield Co., et al., No. 04 Civ. 4972 (SAS).

The opinion of the court was delivered by: SHIRA SCHEINDLIN, District Judge



This multi-district litigation consists of dozens of cases, in which plaintiffs seek relief for contamination or threatened contamination of groundwater from defendants' use of the gasoline additive methyl tertiary butyl ether ("MTBE").*fn1 Plaintiffs include states, cities, municipalities, private water providers, and other entities. Although the cases were filed in various state courts, defendants removed the actions to federal court, asserting four grounds of subject matter jurisdiction: (1) federal agent jurisdiction; (2) substantial federal question; (3) complete preemption; and (4) bankruptcy jurisdiction.*fn2

  Certain plaintiffs moved to remand I denied the motions, holding that this Court has federal agent jurisdiction over some, and bankruptcy jurisdiction over all, of the MTBE cases pending before it.*fn3 I found that defendants had sufficiently averred facts supporting removal; specifically, they alleged that they added MTBE to gasoline at the direction of the EPA, a federal agency, to comply with the requirements of the Reformulated Gasoline ("RFG") Program and the Oxygenated Fuels Program.*fn4 This allegation sufficed to establish jurisdiction based on defendants having acted as federal agents. I further found defendants' allegations sufficient to establish federal agent jurisdiction with respect to certain non-covered areas because the federal government expected to turn some non-covered locations into RFG areas as a practical matter when it promulgated the RFG Program.*fn5 Finally, I held that the Court has bankruptcy jurisdiction because plaintiffs have alleged some actions by defendants that pre-date Texaco's (one of the defendants) plan of reorganization, and questions concerning when claims arose and whether they were discharged involve the enforcement and construction of Texaco's discharge injunction.*fn6

  Notwithstanding the Court's federal question jurisdiction, plaintiffs State of New Hampshire ("New Hampshire") and The People of the State of California ("California") (collectively "State Plaintiffs") move to remand based on state sovereign immunity. I now consider whether principles of sovereign immunity are violated when a state plaintiff voluntarily prosecutes a claim and its case is removed from state to federal court without its consent.


  Section 1447(c) of Title 28 provides that a case removed from state court shall be remanded "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction." When a party files a motion to remand challenging the removal of an action from state court, "the burden falls squarely upon the removing party to establish its right to a federal forum by `competent proof.'"*fn7 "Out of respect for the independence of state courts, and in order to control the federal docket, `federal courts construe the removal statute narrowly, resolving any doubts against removability.'"*fn8 If the removing party cannot establish its right to removal by "competent proof," the removal was improper, and the district court must remand the case to the court in which it was filed.*fn9


  State Plaintiffs argue that the Eleventh Amendment of the United States Constitution protects states from being involuntarily subjected to federal jurisdiction.*fn10 They argue that respecting their right to pursue these actions in state court is consistent with the preeminent purpose" of state sovereign immunity, i.e., the dignitary interest of States, and the Supreme Court's expansive interpretation of the Eleventh Amendment.*fn11 New Hampshire asserts that the federal officer removal statute cannot trump sovereign immunity.*fn12 California contends that in Hans v. Louisiana,*fn13 the Supreme Court established a presumption against proceedings or suits that were "anomalous or unheard of" at the time the Constitution was adopted; since removing States to federal court without their consent was anomalous and unheard of, defendants cannot establish their right to a federal forum, and the case must be remanded.*fn14 In addition, State Plaintiffs assert that cases upholding removal over the objections of sovereigns improperly rely on two inapposite Supreme Court opinions; improperly limit their analyses to the literal text of the Eleventh Amendment; and fail to discuss and apply the Hans presumption.*fn15

  Defendants counter that sovereign immunity does not bar removal where the removal is based on section 1442 of Title 28 because Congress created the federal officer removal statute in order to protect the supremacy of federal law and the sovereignty of the federal government against intrusion by the States. They argue that the Eleventh Amendment and sovereign immunity doctrines do not bar removal, but only prohibit lawsuits against the States, i.e., the immunity only applies when a State is the defendant. Moreover, they contend that the Hans presumption does not bar removal because nothing in Hans or any other case insulates non-consenting States from court process. Finally, defendants assert that California cannot raise the defense of sovereign immunity because the lawsuit is brought by the Sacramento District Attorney, who does not represent the State of California.*fn16

  A. Sovereign Immunity The Eleventh Amendment provides: "The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State."*fn17 Discussions of state sovereign immunity often begin and end here because the text of the Amendment seems clear. On its face, the Eleventh Amendment only prohibits suits against non-consenting States in federal court; it does not bar removal of cases in which the State is the plaintiff.

  However, the Supreme Court has explained:

  The phrase ["Eleventh Amendment immunity"] is a convenient shorthand but something of a misnomer, for the sovereign immunity of the States neither derives from, nor is limited by, the terms of the Eleventh Amendment. Rather, as the Constitution's structure, its history, and the authoritative interpretations by this Court make clear, the State's immunity from suit is a fundamental aspect of the sovereignty which the States enjoyed before the ratification of the Constitution, and which they retain today. . . .*fn18 Therefore, State Plaintiffs' argument that sovereign immunity bars their involuntary removal cannot be dismissed out of hand

  1. Common Law Origin

  The principle of sovereign immunity developed in England based on the feudal system.*fn19 A lord could not be sued by a vassal in his own court, but each lord could be sued in the court of a higher lord.*fn20 Since the king reigned at the top of the system, he was not subject to suit in any court "`[f]or all jurisdiction implie[d] superiority of power. . . .'"*fn21 "Only the sovereign's own consent could qualify the absolute character of that immunity."*fn22 Sovereign immunity was also premised on the notion that the king could do no wrong.*fn23 In adhering to this fiction, courts distinguished between the king and his agents in order to provide relief for the sovereign's transgressions.*fn24 The courts permitted suits against the king's officers on the theory that the king would never have authorized unlawful conduct, and therefore his agent's unlawful acts should not be treated as the acts of the sovereign.*fn25 As Justice Stevens explains:

The rationale for this principle was compelling. Courts did not wish to confront the king's immunity from suit directly; nevertheless they found the threat to liberty posed by permitting the sovereign's abuses to go unremedied to be intolerable. Since in reality the king could act only through his officers, the rule which permitted suits against those officers formally preserved the sovereign's immunity while operating as one of the means by which courts curbed the abuses of the monarch.*fn26
Thus, sovereign immunity historically meant a prohibition against suit in one's own court. Though the immunity was seemingly absolute, some judicial proceedings did not offend the crown.*fn27

  2. Federalism and the Constitutional Structure

  The framers of the Constitution rejected "`the concept of a central government that would act upon and through the States' in favor of `a system in which the State and Federal Governments would exercise concurrent authority over the people. . . .'"*fn28 The Constitution therefore altered some common law principles to balance the supremacy of federal law with the independent sovereignty of States.*fn29

  At the time this nation was founded, the States were sovereign, and "[t]he suability of a state, without its consent, was a thing unknown to the law."*fn30 Under the common law, however, a sovereign was not immune from suit in another sovereign's court, and to the extent he was not suable, his immunity "must [have been] found either in an agreement express or implied between the two sovereigns, or in the voluntary decision of the second to respect the dignity of the first as a matter of comity."*fn31 Although States would retain immunity in their own courts under the federal system, they feared that federal jurisdiction would subject them to raids on their state treasuries.*fn32 Many of the States were heavily indebted as a result of the Revolutionary War,*fn33 and they insisted on protection from being sued in federal court as a condition of participating in the constitutional design. The framers assured the people that sovereign immunity would be preserved in the new government, and the Constitution was adopted with that understanding.*fn34 The federal system could not have been established without the agreement that the States could not be sued by private citizens in federal court.*fn35 As it evolved in the United States then, the doctrine of sovereign immunity encompasses two different concepts — "one applicable to suits in the sovereign's own courts and the other to suits in the courts of another sovereign."*fn36 Under the constitutional bargain, States would be immune from suit in federal court just as they were immune from suit in their own courts.

  3. The Eleventh Amendment and Sovereign Immunity Jurisprudence

  Shortly after the Constitution's adoption, the Supreme Court was tasked with determining whether a private citizen could bring a suit against the State of Georgia in federal court.*fn37 Article III of the Constitution provides, in relevant part: "The judicial Power shall extend to . . . Controversies between a State and Citizens of another State; [and between] a State and foreign States, Citizens or Subjects."*fn38 Based on a literal reading of Article III's jurisdictional grant, the Court determined that Georgia could be sued in federal court.*fn39 The decision sent a "shock of surprise throughout the country" because people had assumed that the States' traditional immunity had been preserved.*fn40 The Eleventh Amendment was proposed and adopted in order to overrule the Court's misinterpretation.*fn41 The Amendment was drafted narrowly because it was not meant to redefine federal jurisdiction,*fn42 but rather, to confirm two suppositions: (1) that each State is a sovereign entity in our federal system; and (2) it is inherent in the nature of sovereignty not to be amenable to the suit of an individual without its consent.*fn43 "[A] suit is against the sovereign if the judgment sought would expend itself on the public treasury or domain, or interfere with the public administration, or if the effect of the judgment would be to restrain the Government from acting, or to compel it to act."*fn44

  The Supreme Court has repeatedly declared that the Eleventh Amendment provides a defense against federal jurisdiction when a State is being sued.*fn45 In keeping with common law tradition and constitutional design, however, the Court has also looked beyond the Amendment's language to determine the scope of a State's protection. It has found sovereign immunity to apply to cases involving citizens suing their own States,*fn46 federal corporations,*fn47 foreign nations,*fn48 and Indian tribes,*fn49 and as a defense to suits in admiralty*fn50 and claims for administrative adjudication*fn51 — even though the Amendment's text does not extend so far.

  There are some limits on sovereign immunity, however. Sovereign immunity may be waived by the State*fn52 or, in certain circumstances, be abrogated by Congress.*fn53 The immunity is limited by the enforcement provisions of Section 5 of the Fourteenth Amendment,*fn54 and by the doctrine of Ex parte Young.*fn55 Under Ex parte Young, private parties are permitted to sue a State for injunctive relief for constitutional violations committed by its officers by suing a state official.*fn56

  Having reviewed the historical origins, constitutional structure, and jurisprudence of sovereign immunity, it is apparent that state sovereign immunity, as embodied by the Eleventh Amendment, bars a suit against a State in federal court without its consent. I now turn to the relationship between state sovereign immunity and removal.

  B. Removal 1. Case Law

  With few exceptions, courts that have addressed the intersection of sovereign immunity and removal have held that the doctrine does not prohibit the removal of State-initiated actions to federal court without the State's consent.*fn57 State Plaintiffs posit that the majority of district courts have misconstrued the Eleventh Amendment and urge this Court to follow the reasoning of California v. Steelcase Inc.,*fn58 and Moore v. Abbott Laboratories, Inc.*fn59 instead. In Steelcase, the People of the State of California filed a civil enforcement action, alleging violations of the California antitrust and unfair competition statutes. The defendant removed the action to federal court based on diversity jurisdiction, and the court sua sponte remanded the action. The Steelcase court held that even if there was diversity of citizenship among the parties, the court lacked jurisdiction because the Eleventh Amendment barred removal without the State's consent. The court reasoned that the Eleventh Amendment "is an immunity from being made an involuntary party to an action in federal court, [and] should [therefore] apply equally to the case where the state is a plaintiff in an action commenced in state court and the action is removed to federal court by the defendant."*fn60 Similarly, in Moore, the State of Mississippi brought an action against manufacturers of infant formula for violations of the Mississippi antitrust statutes. In holding that the proscriptions of the Eleventh Amendment applied to the State as plaintiff, the Moore court explicitly relied on the reasoning of Steelcase.*fn61

  Steelcase and Moore are unpersuasive, however, because they rest on the false premise that sovereign immunity prevents a State from being made an involuntary party to an action in federal court. The opinions cite no authority for this proposition, nor do they engage in anything more than a cursory examination of the Eleventh Amendment. As previously discussed, state sovereign immunity only applies to States as defendants, not plaintiffs.

  2. The Hans Presumption Does Not Bar Removal of These Actions

  California asserts that federal jurisdiction over State Plaintiffs who have been involuntarily removed would run afoul of the Hans presumption.*fn62 But Hans does not stand for the broad proposition urged by California — that federal courts lack jurisdiction if the suit was "anomalous or unheard of" at the time the Constitution was adopted. Rather, it reaffirms the general principle of States' immunity from suit by holding that the Eleventh Amendment extends to actions brought against a State by its own citizens.*fn63 The Hans presumption functioned to preclude those claims against which a state historically had a sovereign immunity defense.*fn64

  Furthermore, California's argument weighs against remand because it would have been anomalous or unheard of for state courts to exercise jurisdiction over federal questions.


The jurisdiction over [cases arising under the constitution, laws, and treaties of the United States] could not exist in the state courts prior to the adoption of the constitution, and it could not afterwards be directly conferred on them; for the constitution expressly requires the judicial power to be vested in courts ordained and established by the United States.*fn65
Even the lower federal courts did not have federal question jurisdiction until the Judiciary Act of 1875 gave them original jurisdiction over "all suits . . . arising under the Constitution or laws of the United States."*fn66

  3. Removal of Cases Brought by State Plaintiffs is Consistent with Principles of Federalism

  On the other hand, the removal of cases to federal court that were initially brought in state court was not novel to the founders. The Constitution presumed local prejudice and therefore provided for diversity jurisdiction.*fn67 However, access to federal courts would be meaningless if plaintiffs could avoid the federal forum by simply filing their cases in state court.*fn68 The Judiciary Act of 1789 therefore permitted removal by defendants,*fn69 and the right "was exercised almost contemporaneously with the adoption of the Constitution. . . ."*fn70

  The Civil War was followed by an increase in federal authority and a curtailment of state power. Congress expanded the original and removal jurisdiction of the federal courts in order to protect federal officers and former slaves.*fn71 In Tennesse v. Davis,*fn72 the Supreme Court upheld removal by a federal officer in a state criminal proceeding because "such jurisdiction is necessary for the preservation of the acknowledged powers of the [federal] government."*fn73 The Court rejected the argument that removal invaded state sovereignty because the States are not sovereign in all respects:

  [W]hen the Constitution was adopted, a portion of that judicial power became vested in the new government created, and so far as thus vested it was withdrawn from the sovereignty of the State. Now the execution and enforcement of the laws of the United States, and the judicial determination of questions arising under them, are confided to another sovereign, and to that extent the sovereignty of the State is restricted. The removal of cases arising under those laws . . . is, therefore, no invasion of State domain. On the contrary, a denial of the right of the general government to remove them . . . is a denial of the conceded sovereignty of that government over a subject expressly committed to it.*fn74 Removal of cases in which the State is the plaintiff is consistent with the constitutional sovereignty of States because there is no real affront to allowing them to proceed in federal court.*fn75 If and when their cases are finally tried, the federal courts will apply state law, thereby respecting and enforcing state policies, while simultaneously resolving federal questions. In that sense, federal and state interests are aligned. By contrast, national and local policies could be antagonistic where the State is a defendant in federal court. When the State is a defendant, it may have a greater interest in having its case litigated in its own courts because a judgment could impact the state treasury or public administration. Removal would offend principles of federalism in that situation.

  Although State Plaintiffs may be inconvenienced by proceeding in this Court, sovereign immunity is not based on convenience — but a balance of federal and state power. Remanding the cases would improperly shift the balance towards the States because it would permit them to achieve unfair tactical advantages at the expense of the people.*fn76


The constitution of the United States was designed for the benefit of all the people of the United States. . . . It was not to be exercised exclusively for the benefit of parties who might be plaintiffs, and would elect the national forum, but also for the protection of defendants who might be entitled to try their rights, or assert their privileges, before the same forum.*fn77
Accordingly, the removal of cases filed by State Plaintiffs does not violate principles of sovereign immunity.*fn78 IV. CONCLUSION

  For the foregoing reasons, State Plaintiffs' motions to remand are denied. The Clerk of the Court is directed to close these motions.


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