Legislatively Capping an Energy Lawsuit: Problems Posed by Stripping a Pending Suit Against Ninety-Seven Oil and Gas Companies

• Author: Taylor Boudreaux
• Position: J.D./D.C.L., 2016, Paul M. Hebert Law Center, Louisiana State University.
• Pages: 959-993

Legislatively Capping an Energy Lawsuit: Problems

Posed by Stripping a Pending Suit Against Ninety-

Seven Oil and Gas Companies

TABLE OF CONTENTS

Introduction .................................................................................. 959

I. History of Action and Reaction .................................................... 963

A. Legislative Inducement: The Causes of Act 544 ................... 963

B. Legislative Adjustment: The Legislature’s Response ............ 967

II. The Constitutionality of Act 544 .................................................. 969

A. The Supreme Court’s Precedent in Morial Supports

Act 544’s Constitutionality .................................................... 971

1. Act 544 May be Applied Retroactively ........................... 972

a. Contracts and Due Process Protections are Not

Pertinent to Act 544’s Intended Subject .................... 972

b. Act 544 Does Not Infringe Upon the Judiciary’s

Independence ............................................................ 976

2. Act 544 Does Not Qualify as a Prohibited Local or

Special Law ..................................................................... 979

B. The Levee Authority’s Constitutional Origins Do Not

Provide Immunity .................................................................. 983

III. Act 544 Is a Necessary Solution to a Complex Problem .............. 984

A. How Does the Lawsuit Fit into the Framework of Coastal

Regulation? ............................................................................ 985

B. Act 544 is the Preferred Solution ........................................... 988

Conclusion .................................................................................... 992

INTRODUCTION

“Coastal Louisiana is vanishing,”1 and the state’s citizens are becoming

aware of that reality.2 From 1932 to 2010, the state of Louisiana has

Copyright 2016, by TAYLOR BOUDREAUX.

1. DAVID M. BURLEY, LOSING GROUND: IDENTITY AND LAND LOSS IN

COASTAL LOUISIANA 5 (2010).

2. Poll Shows that Louisiana Residents Want Oil Companies to Pay for Damage

Done to the Coast, RESTORE LA. NOW (Nov. 22, 2013), http://restorelouisiananow

.org/poll_shows [perma.cc/H6YA-5EYG] [hereinafter Poll Results] (poll showing

960 LOUISIANA LAW REVIEW [Vol. 76

diminished by 1,883 square miles.3 Many Louisianans may not have known

much about wetlands in years past, but disasters like Hurricanes Katrina and

Rita, concerns over rising sea levels, and the BP oil spill in the Gulf of

Mexico have brought the coast’s problems to the public’s attention. One

cannot realistically attach such an extreme loss—spanning over a majority

of the past century—to any one cause because the loss is the result of a

number of factors.4 The most prominent suspects are the Mississippi River

Delta’s “sedimen[t] deprivation,”5 sea level rise,6 and commercial develop ment

of coastal wetlands.7

Crude oil and natural gas production has drastically increased in

Louisiana over much of the last century,8 and the petroleum industry’s

economic impact on the state has grown accordingly.9 That development

has not been without negative side effects, however; studies connecting the

energy industry’s coastal operations to the dramatic land loss have put these

that citizens have substantial concern over protecting the wetlands from coastal

erosion and improving flood protection in their parish).

3. BRADY R. COUVILLION ET AL., LAND AREA CHANGE IN COASTAL LOUISIANA

FROM 1932 TO 2010, at 1 (2011), available at http://pubs.usgs.gov/sim/3164/down

loads/SIM3164_Pamphlet.pdf [perma.cc/6K7W-F8NW] (“Trend analyses from 1985

to 2010 show a wetland loss rate of 16.57 square miles per year. If this loss were to

occur at a constant rate, it would equate to Louisiana losing an area the size of one

football field per hour.”).

4. See Mark Schleifstein, Louisiana is Losing a Football Field of Wetlands an

Hour, New U.S. Geological Survey Study Says, NO LA.COM (June 2, 2011, 9:37 PM),

http://www.nola.com/environment/index.ssf/2011/06/louisiana_is_losing_a_football

.html [perma. cc/R8A4-E65J] (quoting a USGS geograp her, David M. Burley, Brad y

Couvillion, and the director of the USGS National Wetlands Research Center in

Lafayette, Phil Turnipseed).

5. Id.

6. Saskia De Melker, Native Lands Wash Away as Sea Levels Rise, PBS (June

1, 2012, 10:43 AM), http://www.pbs.org/newshour/updates/climate-change-jan-

june12-louisianacoast_05-30/ [perma.cc/263S-YZVS].

7. Bob Marshall, Science to be Key Factor in Lawsuit Against Oil and Gas

Companies for Coastal Los s, LENS (July 23, 2013, 8:51 PM), http://thelensnola.org

/2013/07/23/science-to-be-key-factor-in-lawsuit-against-oil-and-gas-companies-for-

coastal-loss/ [perma.cc/53BY-A2PC].

8. See Louisiana Energy Facts and Figures, LA. DEP’T OF NATURAL RES., http:

//dnr.louisiana.gov/index.cfm?md=pagebuilder&tmp=home&pid=208 [perma.cc/2S

K4-6ADT] (last visited Oct. 22, 2015).

9. Renita D. Young, Oil and Gas Industry Continues to Strongly Support

Louisiana, Study Shows, NOLA.COM (July 11, 2014, 2:33 AM), http://www.nola

.com/business/baton-rouge/index.ssf/2014/07/oil_and_gas_industry_continues.html

[perma.cc/THG7-969J].

2016] COMMENT 961

companies at the center of governmental and public scrutiny.10 The board of

commissioners for the Southeast Louisiana Flood Protection Authority-East

(“SLFPA-E”) was well aware of these studies’ findings.11 Armed with those

findings,12 the board filed suit against almost 100 oil, gas, and pipeline

companies13 that have operated in the southeast portion of the state,

specifically in the “Buffer Zone.”14 The SLFPA-E, tasked with the

construction and maintenance of flood prevention systems in the New

Orleans and Lake Pontchartrain areas,15 argued that the defendants’

production operation negatively affected the wetlands that act as a

preventative barrier or initial line of flood defense,16 which made the board’s

ability to carry out its duties more burdensome.17 The lawsuit prayed for

injunctive relief and damages, asserting negligence, strict liability, natural

servitude of drainage, public nuisance, private nuisance, and breach of

contract.18

10. See Alisha A. Renfro, New Study Examines Oil and Gas Production’s

Increased Effects on Louisiana Coastal Land Loss, RESTORE MISS. RIVER

DELTA (Jan. 11, 2012), http://www.mississippiriverdelta.org/blog/2012/01/11/new-

study-examin es-oil-and-gas-production%E2%80%99s-increased-effects-on-louisiana

-coastal-land-loss/ [perma.cc/YT3S-LPJ3].

11. Marshall, supra note 7.

12. Melker, supra note 6; Marshall, supra note 7.

13. Mark Schleiftstein, Historic Lawsuit Seeks Billons in Damages from Oil,

Gas, Pipeline Industries for Wetlands Losses, NOLA.COM (July 24, 2013, 9:30 AM),

http://www.nola.com/environment/index.ssf/2013/07/historic_east_bank_levee_au

tho.html [perma.cc/E5KB-UQYT].

14. Petition for Damages and Injunctive Relief at 7, Bd. of Comm’rs of the

Se. La. Flood Prot. Auth. v. Tenn. Gas Pipeline Co., No. 13-6911 (La. Dist. Ct.

July 24, 2013). The “Buffer Zone” is described as extending “from East of the

Mississippi River through t he Breton Sound Basin, the Biloxi Marsh, and the

coastal wetlands of eastern New Orleans and up to Lake St. Catherine.” Id.

15. LA. REV. STAT. ANN. § 38:330.2(2) (Supp. 2015).

1 6. Petition for Damages and Injunctive Relief, supra note 14, at 8–10.

17. Id. at 3.

18. Id. at 17–23. Months after removal, the federal district court dismissed

SLFPA-E’s suit for failure to state a claim. See Mark Schleifstein, Federal Judge

Dismisses Levee Authority’s Wetlands Damage Lawsuit Against Oil, Gas

Companies, NOLA.COM (Feb. 13, 2015, 7:52 PM), http://www.nola.com/environ

ment/index.ssf/2015/02/federal_judge_dismisses_east_b.html [perma.cc/KZ4G-KW

EL]. This dismissal order did not address Act 544 and its proposed effect on SLFPA-

E. See id. Additionally, the decision will inevitably be appealed. See Mark

Schleifstein, Appeal of Wetlands Damage Suit Against Energy Companies Will

Continue, NOLA.COM (March 2, 2015, 6:45 PM), http://www.nola.com/environment

/index.ssf/2015/03/continue_the_appeal_of_wetland.html [perma.cc/H4W3-8V28].

Because the dismissal order did not discuss Act 544’s application or legali ty, the issue