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Shell Offshore Inc., A Delaware Corporation, and v. Greenpeace

March 28, 2012

SHELL OFFSHORE INC., A DELAWARE CORPORATION, AND
SHELL GULF OF MEXICO INC., A DELAWARE CORPORATION,
PLAINTIFFS,
v.
GREENPEACE, INC., A CALIFORNIA CORPORATION, AND
JOHN AND JANE DOES 1-20,
DEFENDANTS.



The opinion of the court was delivered by: Sharon L. Gleason United States District Judge

ORDER GRANTING MOTION FOR PRELIMINARY INJUNCTION

(Within United States Territorial Waters and Ports)

Shell Oil Company*fn1 filed a combined Motion for Temporary Restraining Order and Preliminary Injunction on February 27, 2012.*fn2 After a hearing on February 29, 2012 at which both Shell and Greenpeace, Inc., participated, this court entered a Temporary Restraining Order on March 1, 2012 which has enjoined Greenpeace and those acting in concert with it from engaging in certain illegal or tortious acts within U.S. territorial waters and waters of the Exclusive Economic Zone of the United States against two vessels in which the plaintiff has an interest.*fn3 Specifically, the order applied to the two primary vessels which Shell intends to use this summer for exploratory offshore oil drilling in the Beaufort and Chukchi Seas off the northwestern coast of Alaska: the Kulluk and the Noble Discoverer. The Temporary Restraining Order was initially effective until March 14, 2012. It was extended for an additional 14 days until March 28, 2012 when Greenpeace, Inc., which is also known as Greenpeace USA, sought additional time to file its opposition to the Motion for Preliminary Injunction.*fn4

Greenpeace USA filed its opposition to the Motion for Preliminary Injunction on March 12, 2012.*fn5 With that opposition, it submitted sworn declarations from Thomas Wetterer, Greenpeace USA's General Counsel;*fn6 Nathan Santry, Greenpeace USA's Director of Actions;*fn7 and Anthony Ford, a mariner who is currently employed as the ship handling Senior Instructor at United States Navy ship simulators.*fn8

Shell filed its reply on March 16, 2012.*fn9 With its reply, it included sworn declarations from William Kupchin, the Aviation Manager for Shell's planned Arctic operations;*fn10

Stephen Phelps, the Exploration and Appraisal Manager for the summer drilling plans;*fn11 and John Kaighin, the Marine Manager responsible for all vessels supporting the Arctic operations.*fn12 In addition, Shell filed extensive exhibits with the court including both information about its drilling plans as well as documentation regarding Greenpeace USA, Greenpeace International, and other Greenpeace offices.*fn13

A hearing on the Motion for Preliminary Injunction was held on March 19, 2012. Counsel for both parties presented arguments to the court; in addition, Mr. Wetterer testified on behalf of Greenpeace USA.

Also on March 19, 2012, Greenpeace USA filed a motion seeking dismissal of this action pursuant to Federal Rule of Civil Procedure 12(b)(1), alleging that this court lacked subject matter jurisdiction to hear this controversy.*fn14 Shell's opposition to that motion is due on March 30, 2012; Greenpeace USA's reply is due on April 6, 2012.*fn15 In addition, by motion filed on March 21, 2012, Greenpeace USA has sought dismissal of this action based upon Federal Rule of Civil Procedure 12(b)(6), alleging that Shell has failed to state a claim upon which relief may be granted.*fn16

Greenpeace USA also filed a separate motion on March 19, 2012 seeking to have this court stay its ruling on Shell's Motion for Preliminary Injunction pending a decision on Greenpeace USA's Rule 12(b) motions. Shell opposed the stay motion on March 23, 2012, unless this court extends the Temporary Restraining Order currently in place and adds additional support vessels to that order.*fn17 On March 27, 2012, Greenpeace USA replied. It indicated its continuing request for the stay, and its opposition to any further extension of the Temporary Restraining Order, which expires on this date.*fn18

Greenpeace USA's Motion to Dismiss for Lack of Subject Matter Jurisdiction

A district court may not grant a preliminary injunction if it lacks subject matter jurisdiction over the claim before it.*fn19 Therefore, the jurisdictional question raised by Greenpeace USA's Rule 12(b)(1) motion must be considered before evaluating Shell's motion for a preliminary injunction, as the latter issue is moot if this court is without subject matter jurisdiction.

Greenpeace USA's Rule 12(b)(1) motion is not yet ripe, as Shell has not yet had the opportunity to file its response to the motion. However, this court has fully reviewed the motion, and also heard argument of counsel with respect to subject matter jurisdiction at the recent hearing on Shell's motion for a preliminary injunction. Although there are components of Greenpeace USA's Rule 12(b)(1) motion as to which this court will defer a ruling pending the completion of briefing on the motion, this court finds that there are components of Greenpeace USA's motion that are without merit, such that the motion should be denied in part at this time, and particularly given the fact that the Temporary Restraining Order currently in effect will expire by its terms on this day -- March 28, 2012 -- before the briefing on the Rule 12(b)(1) motion is completed.

Greenpeace USA's Rule 12(b)(1) motion first asserts that diversity jurisdiction does not exist. Greenpeace USA's primary concern in this regard may now be resolved, since the Second Amended Verified Complaint alleges that the matters in controversy exceed the sum or value of $75,000.*fn20 However, this court will defer a ruling on this issue pending the completion of briefing by the parties on the motion. Specifically, the parties' briefing should address whether diversity jurisdiction exists and/or is necessary for this court to have subject matter jurisdiction with respect to Shell's motion for injunctive relief at land-based facilities. No immediacy for a ruling on these facilities has been demonstrated, because the injunctive relief that Shell currently seeks with respect to land-based facilities would apply solely to aviation facilities in Barrow, Alaska, which presumably will not be in use by Shell for at least several weeks.*fn21

Greenpeace USA's motion also asserts that federal question jurisdiction does not exist with respect to Shell's complaint against it. 28 U.S.C. § 1333 provides as follows:

The district courts shall have original jurisdiction, exclusive of the courts of the States, of: (1) Any civil case of admiralty or maritime jurisdiction, saving to suitors in all cases all other remedies to which they are otherwise entitled . "The traditional domain of admiralty jurisdiction is, of course, the sea, including waters within the ebb and flow of the tide."*fn22

In assessing the scope of admiralty jurisdiction at this stage of the proceedings, it is helpful to distinguish between the territorial sea and U.S. ports on the one hand, and the U.S. Exclusive Economic Zone on the other hand. The territorial sea extends 12 miles from the baseline shore.*fn23

Under international law the coastal [nation] has complete sovereignty over the seas, the air space, the seabed and the subsoil of this area . An exception to this sovereign control, however, is the right of innocent passage of foreign vessels. No right of innocent passage in the air space above the territorial sea exists in the absence of an agreement or permission by the coastal state.*fn24

The Exclusive Economic Zone begins at the outer limit of the territorial sea and extends 200 miles from the baseline of the coastal nation.*fn25

Shell seeks to prevent the occurrence of illegal or tortious activities by Greenpeace USA on navigable waters with respect to Shell's contracted vessels. The passage of such vessels on navigable waters is indisputably a commercial maritime activity, and it is this precise maritime activity that Shell has alleged that Greenpeace USA seeks to disrupt. As explained by the United States Supreme Court,

We determine the potential impact [on maritime commerce] of a given type of incident by examining its general character. The jurisdictional inquiry does not turn on the actual effects on maritime commerce . Rather, a court must assess the general features of the type of incident involved to determine whether such an incident is likely to disrupt commercial activity.*fn26

If such disruption is likely, then it is clear that this court has admiralty jurisdiction, at least at United States ports and within the territorial sea of the United States. Given that Shell has alleged that Greenpeace USA seeks to disrupt Shell's maritime activities at U.S. ports and within the territorial sea, it is clear that this court has admiralty jurisdiction over Shell's action against Greenpeace USA in these areas.*fn27

With respect to the Exclusive Economic Zone and land-based facilities, this court will defer the determination of Greenpeace USA's Rule 12(b)(1) motion to dismiss until the briefing is completed by the parties on that motion. Deferral of the parameters of subject matter jurisdiction in those areas is warranted for two reasons. First, the Shell-contracted vessels are not scheduled to begin exploratory drilling until approximately July 1, 2012. By then, they are scheduled to be within the Exclusive Economic Zone, but there is no urgency with respect to the actual drilling sites prior to the completion of the briefing of the motions to dismiss. Second, although this court likely has some degree of subject matter jurisdiction in the Exclusive Economic Zone by virtue of the Outer Continental Shelf Lands Act ("OCSLA"),*fn28 the delineation of any injunctive relief in the Exclusive Economic Zone should occur after the precise parameters of that subject matter jurisdiction have been determined by this court under the OCSLA, general admiralty jurisdiction, and any other basis.

Greenpeace USA also asserts in its Rule 12(b)(1) motion to dismiss that there is no current case or controversy because the New Zealand incident cannot be attributed to Greenpeace USA, and with respect to any future activity by Greenpeace USA, Shell has not shown that it is "immediately in danger of sustaining some direct injury."*fn29 Instead, Greenpeace USA asserts that Shell has demonstrated only that "Greenpeace USA may or could do something in the future" and that this court should not maintain jurisdiction "based on Shell's conjecture or hypothetical possibilities."*fn30 This argument is closely related the requirement that a plaintiff seeking a preliminary injunction must establish that there is a likelihood of irreparable harm in the absence of preliminary relief, and is discussed in that context further herein. But an "injury need not have been inflicted when application [for injunctive relief] is made or be certain to occur[.]"*fn31 Indeed, "[r]equiring a showing of actual injury would defeat the purpose of the preliminary injunction, which is to prevent an injury from occurring."*fn32 The current record before this court, as discussed further herein, demonstrates the existence of a case or controversy with respect to Greenpeace USA's potential future conduct.

Thus, in light of the foregoing, this court finds that it has subject matter jurisdiction with respect to the ports of the United States and its territories, together with the territorial waters of the United States, and Greenpeace's Rule 12(b)(1) motion as well as its motion to stay are denied with respect to those areas. Greenpeace USA's motion to stay a ruling on Shell's Motion for Preliminary Injunction is granted with respect to land-based facilities and the United States Exclusive Economic Zone pending the completion of briefing by the parties on Greenpeace USA's Rule 12(b)(1) motion.

Greenpeace USA's Motion to Dismiss for Failure to State a Claim

As noted above, Greenpeace USA has also recently filed a motion to dismiss pursuant to Civil Rule 12(b)(6) alleging that Shell has failed to state any viable cause of action against it. This court has reviewed the motion and will defer ruling upon it pending the completion of briefing by the parties, particularly in light of Shell's recent amendment of its complaint.*fn33 However, based on the court's review of the motion, Greenpeace USA's motion to stay a ruling on Shell's Motion for Preliminary Injunction pending the determination of the Rule 12(b)(6) motion is denied. The following discussion is intended to guide the parties in their further briefing of the 12(b)(6) motion.

In its 12(b)(6) motion, Greenpeace USA has correctly acknowledged that maritime trespass has been recognized as a federal cause of action by the Fifth Circuit.*fn34 Thus, in Marastro Compania Naviera, S.A. v. Canadian Maritime Carriers, the Fifth Circuit held "that general common law and in particular the Restatement (Second) of Torts should control to determine the law of maritime trespass, in order to promote uniformity in general maritime law."*fn35

Under the Restatement, one is subject to liability for trespass to chattels by intentionally intermeddling with property in the possession of another.*fn36 Greenpeace USA asserts that "the Restatement does not contemplate a cause of action for a threatened trespass."*fn37 But this assertion appears to be directly at odds with the Restatement itself. While a showing of actual trespass may be required in order to recover damages, the Restatement makes it clear that in appropriate cases, injunctive relief may be ordered for torts that are only threatened and have not actually occurred.*fn38

In this regard, Section 933 of the Restatement of Torts provides that "the availability of an injunction against a committed or threatened tort depends upon the appropriateness of this remedy as determined by a comparative appraisal of the factors [that are] listed in § 936."*fn39 The commentary to Section 933 explains the meaning of the term "threatened tort":

The expression "threatened tort," as used in . this Section, contemplates, as a condition for the grant of an injunction, a threat of sufficient seriousness and imminence to justify coercive relief . A defendant may threaten a tort not only by utterances that express an intention to commit a tort, but also by action or inaction that, under the circumstances, shows that there is a dangerous probability that he will commit a tort. Indeed a common method of proving a threat of a future tort is by proving a past tort under conditions that render its repetition or continuance probable. It is not necessary, however, to prove past wrong. Without that, the defendant's words and acts may establish the dangerous probability that is essential.*fn40

The Restatement cautions that An injunction is not justified, however, by the mere fact that the defendant is in a position where he will be tempted to commit a tort, nor by the fact that persons in his position sometimes do commit torts, nor by the fact that the plaintiff fears that the defendant will commit a tort.*fn41

The federal district court cited Section 933 of the Restatement in Women Prisoners of Dist. of Columbia Dept. of Corrs. v. Dist. of Columbia to explain its rejection of the defendants' argument there that "the common law of torts forbids injunctive relief to prevent future torts":

In negligence actions where irreparable injury is threatened, a court may act by injunction to prevent harm before it occurs . The threatened tort must be of sufficient seriousness and imminence to justify coercive relief.*fn42

This court will await completion of the briefing before ruling on Greenpeace USA's pending motion to dismiss pursuant to Rule 12(b)(6). But in light of the foregoing preliminary analysis, this court will proceed to the merits of Shell's pending Motion for Preliminary Injunction with respect to the United States territorial sea and ports.

Shell's Motion for Preliminary Injunction

Plaintiffs seeking preliminary injunctive relief must establish that "(1) they are likely to succeed on the merits; (2) they are likely to suffer irreparable harm in the absence of preliminary relief; (3) the balance of equities tips in their favor; and (4) a preliminary injunction is in the public interest."*fn43 "Under the 'sliding scale' approach to preliminary injunctions observed in [the Ninth Circuit], 'the elements of the preliminary injunction test are balanced, so that a stronger showing of one element may offset a weaker showing of another.'"*fn44 But in any event, even with the sliding scale approach, "plaintiffs must establish that irreparable harm is likely, not just possible, in order to obtain a preliminary injunction."*fn45 Injunctive relief is an equitable remedy, and "[t]he essence of equity jurisdiction is the power of the court to fashion a remedy depending upon the necessities of the particular case."*fn46

This court has previously assessed these factors when granting Shell's motion for a Temporary Restraining Order. The record now before the court is more developed. This order is based on the more recent submissions of both parties and arguments of counsel regarding the Motion for Preliminary Injunction. Upon review of that record, this court finds as follows:

1. The likelihood of success on the merits

As discussed above,*fn47 the law recognizes that a party may seek injunctive relief to prevent threatened illegal or tortious conduct. To obtain injunctive relief, plaintiffs must show themselves to be under threat of suffering "injury in fact" that is concrete and particularized; the threat must be actual and imminent, not conjectural or hypothetical; it must be fairly traceable to the challenged action of the defendant; and it must be likely that a favorable judicial decision will prevent or redress the injury.*fn48

Here, Shell has submitted persuasive evidence that it is under threat of an injury in fact that is concrete and particularized. Greenpeace USA's website opens to a photo of three polar bears on which the words "STOP SHELL" are prominently displayed. The "O" in the word "STOP" has been replaced by Shell's logo surrounded by oil.*fn49 The website encourages individuals to send an e-mail to the President of Shell US protesting Shell's Arctic exploration plans -- an action that Shell is not seeking to enjoin in this litigation. But Greenpeace USA's efforts to "stop Shell" are not limited to an e-mail campaign. The record demonstrates that Greenpeace USA also fully endorsed the conduct the New ...


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