The U.S. Supreme Court is grappling with whether dozens of lawsuits filed by Louisiana communities against major oil and gas companies should be heard in state courts or moved to federal jurisdiction, a decision that could reshape years of litigation over environmental damage along the Gulf Coast.
During oral arguments on Monday, the justices examined a narrow but pivotal legal question that will influence more than 40 cases brought by coastal parishes and the Louisiana attorney general. The suits seek billions of dollars from energy companies, including Chevron and Exxon Mobil, to fund restoration and remediation of wetlands allegedly harmed by decades of oil and gas activity.
At the heart of the dispute is whether the cases belong in federal court, which is generally seen as more favorable to corporate defendants, or whether they should remain in Louisiana’s state courts. The outcome could set a precedent affecting not only this litigation but also future cases involving government contractors nationwide.
A jurisdiction fight with broad implications
Chevron’s attorney, Paul Clement, argued that the lawsuits should be moved to federal court because the companies’ actions were tied to refining contracts carried out under federal supervision during World War II. He pointed to a statute granting federal jurisdiction over lawsuits connected to actions taken “under color” of a federal office, language that was expanded by Congress in 2011. According to Clement, that amendment broadened the scope enough to cover the activities now being challenged.
Louisiana officials strongly disagreed. State Solicitor General Ben Aguinaga urged the court to uphold a 2024 ruling by the 5th U.S. Circuit Court of Appeals, which found that the oil companies’ exploration and production work was unrelated to wartime refining contracts. He said the lawsuits, filed in 2013, accuse the companies of violating Louisiana’s coastal management law by dumping billions of gallons of produced water into marshlands and failing to obtain or comply with required permits.
Several justices from across the ideological spectrum expressed concern about how far the federal statute should extend. Chief Justice John Roberts questioned whether the phrase “relating to” could be stretched too broadly, warning that an expansive interpretation might trigger unintended consequences in other cases. Justice Ketanji Brown Jackson noted that Congress had described the 2011 change as a technical adjustment rather than a sweeping expansion of federal power.
The stakes are significant. In April 2025, a Louisiana jury ordered Chevron to pay nearly $745 million to Plaquemines Parish in one of the cases, underscoring the potential financial exposure facing the industry. Meanwhile, the Trump administration sided with the companies, arguing that assisting the federal government during wartime placed them under federal authority. Justice Samuel Alito did not participate in the arguments after recusing himself due to financial ties involving a related company.
The Supreme Court is expected to issue its ruling by June. Whatever the decision, it is likely to influence not only Louisiana’s long-running coastal damage battle but also how courts handle future lawsuits involving federal contractors and environmental claims.