United States v. Exxon Mobil Corporation ( 2019 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 18-55481
Petitioner-Appellant,
D.C. No.
v. 2:17-mc-00066-
CBM-PJW
EXXON MOBIL CORPORATION,
Respondent-Appellee. OPINION
Appeal from the United States District Court
for the Central District of California
Consuelo B. Marshall, District Judge, Presiding
Argued and Submitted November 4, 2019
Pasadena, California
Filed December 9, 2019
Before: Mary M. Schroeder and Michelle T. Friedland,
Circuit Judges, and Lee H. Rosenthal, * District Judge.
Per Curiam Opinion
*
The Honorable Lee H. Rosenthal, Chief United States District
Judge for the Southern District of Texas, sitting by designation.
2 UNITED STATES V. EXXON MOBIL CORP.
SUMMARY **
Subpoenas
The panel reversed the district court’s order denying the
United States Chemical Safety and Hazard Board’s petition
to enforce five requests, made pursuant to administrative
subpoenas, issued against Exxon Mobil Corporation
following an explosion and chemical release at an
ExxonMobil refinery.
The Board challenged only portions of five of the denied
requests that related to the alkylation unit and the modified
hydrofluoric acid stored there. The requests sought
information that was relevant to the February 2015
accidental chemical release.
The panel agreed with the Board’s position that its
requests for information and documents related to the
alkylation unit and the modified hydrofluoric acid stored
there were related to its investigation because the risks of
damage to the alkylation unit and an accidental release of
modified hydrofluoric acid were among the “facts,
conditions, and circumstances” of the February 2015
accidental release from the adjacent fluid catalytic cracking
unit.
The panel held that a review of the specific disputed
requests confirmed that each sought material that might cast
light on the Board’s investigation into the February 2015
**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
UNITED STATES V. EXXON MOBIL CORP. 3
release. The panel reversed the challenged portions of the
district court’s ruling that the subpoena requests were
unenforceable and remanded for further proceedings.
COUNSEL
Jeffrey B. Clark (argued), Assistant Attorney General;
Garrett Coyle, Mark R. Haag, and John E. Arbab, Attorneys;
Eric Grant, Deputy Assistant Attorney General;
Environment & Natural Resources Division, United States
Department of Justice, Washington, D.C.; Raymond Porfiri,
U.S. Chemical Safety and Hazard Investigation Board,
Washington, D.C.; for Petitioner-Appellant.
Steven J. Olsen (argued), Matthew R. Cowan, Lauren F.
Kaplan, and John B. Sprangers, O’Melveny & Myers LLP,
Los Angeles, California; Hannah Y. Chanoine, O’Melveny
& Myers LLP, New York, New York; for Respondent-
Appellee.
Xavier Becerra, Attorney General; Christie Vosburg,
Supervising Deputy Attorney General; James R. Potter,
Deputy Attorney General; Office of the Attorney General,
Los Angeles, California; for Amicus Curiae California
Attorney General.
Bayron T. Gilchrist, General Counsel; Barbara B. Baird,
Chief Deputy Counsel; Daphne Hsu, Senior Deputy District
Counsel; South Coast Air Quality Management District,
Diamond Bar, California; for Amicus Curiae South Coast
Air Quality Management District.
4 UNITED STATES V. EXXON MOBIL CORP.
OPINION
PER CURIAM:
After an explosion and chemical release at an
ExxonMobil refinery, the United States Chemical Safety and
Hazard Board issued seven subpoenas with a total of
380 requests. ExxonMobil refused to comply with 56 of the
requests. The district court held a hearing and, after
argument, granted the Board’s petition to enforce about half
of the disputed requests, but declined to enforce 27, one in
part. The Board appeals the district court’s denial of its
petition to enforce only five of those 27 requests. We hold
that, although the district court did an admirable job, as
evidenced by the narrow scope of this appeal, it erred in
finding these five requests unenforceable. We reverse and
remand.
I.
On February 18, 2015, an explosion in the fluid catalytic
cracking unit in ExxonMobil’s Torrance, California oil
refinery caused a release of flammable hydrocarbons and ash
mixed with metal, fiberglass, and glass wool debris into the
air. Four workers were injured, and ExxonMobil closed the
fluid catalytic cracking unit for 15 months for repair. The
explosion caused a 40-ton piece of debris from the fluid
catalytic cracking unit to fly approximately 100 feet, landing
in the adjacent alkylation unit. The debris landed within five
feet of a “settler,” or tank, filled with modified hydrofluoric
acid, a highly corrosive liquid that is toxic if released. The
Torrance refinery used a modified form of hydrofluoric acid
believed to be safer than the pure form, but less widely used.
The U.S. Chemical Safety and Hazard Investigation
Board is authorized to “investigate (or cause to be
UNITED STATES V. EXXON MOBIL CORP. 5
investigated), determine and report to the public in writing
the facts, conditions, and circumstances and the cause or
probable cause of any accidental release resulting in a
fatality, serious injury or substantial property damages.”
42 U.S.C. § 7412(r)(6)(C)(i). An “accidental release” is “an
unanticipated emission of a regulated substance or other
extremely hazardous substance into the ambient air from a
stationary source.” 42 U.S.C. § 7412(r)(2)(A). As part of a
§ 7412(r)(6)(C) investigation into an accidental release, the
Board may:
hold such hearings, sit and act at such times
and places, administer such oaths, and
require by subpoena or otherwise attendance
and testimony of such witnesses and the
production of evidence and may require by
order that any person engaged in the
production, processing, handling, or storage
of extremely hazardous substances submit
written reports and responses to requests and
questions within such time and in such form
as the Board may require.
42 U.S.C. § 7412(L)(i).
The Board issued seven subpoenas containing
380 document and information requests. ExxonMobil
complied with most, producing 65 witnesses and nearly
137,000 pages of documents, but refused to comply with
56 requests, arguing that they exceeded the Board’s
investigatory and subpoena authority.
The Board filed a petition to enforce the administrative
subpoenas in the United States District Court for the Central
District of California. The court considered each of the
56 requests ExxonMobil challenged, finding 29 enforceable,
6 UNITED STATES V. EXXON MOBIL CORP.
26 unenforceable, and one enforceable in part. The district
court reasoned that “many of the [Board’s] requests seek
evidence that is relevant under [the] generous standard” that
applies to enforcement of administrative subpoenas, but
others “seek information with such attenuated connections
to the February 2015 release that they cannot reasonably be
considered relevant even under the most liberal relevance
standard.”
In this appeal, the Board challenges only portions of five
of the denied requests. The requests at issue all relate to the
alkylation unit and the modified hydrofluoric acid stored
there. The disputed portions of the requests are as follows:
1SUBDOC01: All risk assessments
performed for . . . the alkylation unit, . . . for
the past fifteen years . . . .
1SUBINT01: Provide information related to
the vendors and manufacturers of the
modified hydrofluoric acid used in the
alkylation unit including a list of vendors,
manufacturers, and quantity purchased
annually, dates and contact information.
3SUBDOC19: All studies, reports, analysis,
data, experiments, modeling, technical
analysis and specifications related to the
same or similar modified hydrofluoric acid
used in the alkylation unit at the time of the
February 18 incident including but not
limited to: records provided or shown to the
City of Torrance or their representatives,
ExxonMobil or third party records, records
provided by the manufacturer or vendor,
UNITED STATES V. EXXON MOBIL CORP. 7
records relating to the documented or
asserted degree of [hydrofluoric acid] vapor
suppression for modified [hydrofluoric acid],
and industry and/or Mobil/ExxonMobil
studies, experiments, modeling of modified
[hydrofluoric acid] and its effectiveness in
suppressing vapor compared to unmodified
[hydrofluoric acid].
3SUBDOC20: All records related to the
volume and concentration of hydrofluoric
acid contained in the each of the two
alkylation unit [hydrofluoric] acid settlers at
the time of the February 18 incident.
3SUBDOC43: All documentation
identifying Alkylation . . . Unit siting
hazards, risks, and safety concerns.
Documentation includes calculations,
recommendations, resolutions, preventative
measures implemented, mitigate measures
implemented, plot plans, simulations, and
toxic, flammable, and explosive hazards
identified.
II.
We review a district court’s decision not to enforce an
administrative subpoena for abuse of discretion. McLane
Co. v. EEOC (“McLane I”), 137 S. Ct. 1159, 1164 (2017).
As part of abuse-of-discretion review, we determine de novo
whether the district court identified the correct legal rule.
United States v. Hinkson, 585 F.3d 1247, 1261–62 (9th Cir.
2009). A district court ruling “predicated on an erroneous
view of the legal standard” is an abuse of discretion. EEOC
8 UNITED STATES V. EXXON MOBIL CORP.
v. McLane Co. (“McLane II”), 857 F.3d 813, 815 (9th Cir.
2017); see also McLane I, 137 S. Ct. at 1168 n.3.
III.
“The scope of the judicial inquiry in an . . . agency
subpoena enforcement proceeding is quite narrow.” EEOC
v. Fed. Exp. Corp., 558 F.3d 842, 848 (9th Cir. 2009)
(quoting EEOC v. Karuk Tribe Hous. Auth., 260 F.3d 1071,
1076 (9th Cir. 2001)). “As long as the evidence is relevant,
material, and there is some ‘plausible’ ground for
jurisdiction . . . , the court should enforce the subpoena.” Id.(quoting EEOC v. Children’s Hosp. Med. Ctr., 719 F.2d
1426, 1430 (9th Cir. 1983) (en banc)). The relevance
requirement is “not especially constraining,” but is instead
“‘generously construed’ to ‘afford[] the [agency] access to
virtually any material that might cast light on [the matter
under investigation].’” Id. at 854 (quoting EEOC v. Shell
Oil Co., 466 U.S. 54, 68–69 (1984) (first alteration in
original)).
The parties appropriately agree that the February 2015
explosion was an “accidental release” within the Board’s
§ 7412(r)(6)(C)(i) investigative authority; that the Board had
authority under § 7412(r)(6)(L) to subpoena relevant
documents and information; and that the Board’s subpoenas
were enforceable to the extent they seek information relevant
to “the facts, conditions, and circumstances and the cause or
probable cause” of the February 2015 accidental release. See
42 U.S.C. § 7412(r)(6)(C)(i). The parties’ dispute in the
district court was over whether 56 requests in the subpoenas
sought information that is in fact relevant to the “facts,
conditions, and circumstances and the cause or probable
cause” of the February 2015 accidental release.
UNITED STATES V. EXXON MOBIL CORP. 9
On appeal, the parties focus on the five challenged
requests in more detail than in the district court, where there
were many more requests in dispute. The parties now
present their primary dispute over the five requests’ validity
as one of statutory interpretation.
The parties agree that no modified hydrofluoric acid was
released in the February 2015 explosion and release. But the
parties also agree that the February 2015 explosion in the
fluid catalytic cracking unit that caused the accidental
release also caused the 40-ton piece of debris to land in the
alkylation unit, five feet from a settler containing the
modified hydrofluoric acid. The Board argues that its
requests for information and documents related to the
alkylation unit and the modified hydrofluoric acid stored
there are relevant to its investigation because the risks of
damage to the alkylation unit and an accidental release of
modified hydrofluoric acid were among the “facts,
conditions, and circumstances” of the February 2015
accidental release from the adjacent fluid catalytic cracking
unit. ExxonMobil responds that because there was no
damage to the alkylation unit or release of modified
hydrofluoric acid, the requests were relevant to a potential
future release and not to the “facts, conditions, and
circumstances” of the release that did occur.
We agree with the Board. In our view, ExxonMobil’s
position on appeal does not meaningfully differ from the
argument it presented to the district court that “facts,
conditions, and circumstances” were limited to those
relevant to “determining the cause or probable cause” of the
accidental release. The district court correctly rejected that
argument, ruling that ExxonMobil’s interpretation would
make the words “facts, conditions, and circumstances”
superfluous. We agree that such an interpretation would fail
10 UNITED STATES V. EXXON MOBIL CORP.
to give any meaning to the key phrase “facts, conditions, and
circumstances.” But the district court’s conclusion that the
five subpoena requests relating to the alkylation unit and the
modified hydrofluoric acid stored there were not relevant to
the February 2015 explosion and accidental release in effect
imported the causation limitation back into the relevance
determination. ExxonMobil illustrates this by arguing on
appeal that the requested information and documents about
the modified hydrofluoric acid stored in the alkylation unit
are not relevant because neither that unit nor the acid were
“involved in circumstances that led to the over-
pressurization and accidental release” in the fluid catalytic
cracking unit.
“When interpreting a statute, we must start with the
language of the statute.” Metro One Telecomms., Inc. v.
Comm’r, 704 F.3d 1057, 1061 (9th Cir. 2012). Section
7412(r)(6)(C)(i) authorizes the Board to “investigate . . . the
facts, conditions, and circumstances and the cause or
probable cause of any accidental release.” The Board may
investigate “the facts, conditions, and circumstances” of a
release, in addition to, and separately from, its “cause or
probable cause.” The Board is not limited to the “facts,
conditions, and circumstances” that caused the accidental
release. The Board should look as well to the effects and the
potential harm, were a similar incident to occur.
The presence of two tanks full of toxic chemicals on the
site of the explosion, very close to where debris from that
explosion landed, is among the “circumstances” of the
explosion. The breadth of the term “circumstances”
supports this result, by authorizing the Board to investigate
not only the causes of an explosion, but also its effects. The
text of Section 7412(r)(6)(C)(i) compels this result, which is
reinforced by viewing that provision within the broader
UNITED STATES V. EXXON MOBIL CORP. 11
context of the statute. For example, the Board’s duty to
“issue periodic reports to the Congress, Federal, State and
local agencies” and in so doing to “recommend[] measures
to reduce the likelihood or the consequences of accidental
releases,” § 7412(r)(6)(C)(ii), bears on what information is
included within the Board’s Section 7412(r)(6)(C)(i)
investigatory authority. 1 Similarly, the statute’s objective of
“minimiz[ing] the consequences of any” accidental release,
§ 7412(r)(1), confirms that an investigation into
consequences that in fact arose, for the purpose of preventing
similar and worse consequences in the future, is consistent
with the statute’s overall purpose. 2
1
We need not decide whether Section 7412(r)(6)(C)(ii) conferred
an independent source of subpoena authority to the Board in this case.
We merely cite this provision because it sheds light on the reasons why
Congress granted investigatory power to the Board under Section
7412(r)(6)(C)(i) and thus on the intended scope of that investigatory
power.
2
Section 7412(r)(6)(F) is not to the contrary. Under that provision,
the Board may “conduct research and studies with respect to the potential
for accidental releases” under 42 U.S.C. § 7412(r)(6)(F). The Board’s
subpoena power under Section 7412(r)(6)(L) does not extend to research
and studies of potential releases under Section 7412(r)(6)(F).
ExxonMobil argues that the Board could investigate a possible future
release of modified hydrofluoric acid under its Section 7412(r)(6)(F)
authority—without subpoena power—but that allowing the Board to
investigate potential releases under Section 7412(r)(6)(C)(i) would make
Section 7412(r)(6)(F) superfluous. But when a potential release is part
of the “facts, conditions, and circumstances” of an actual release, the
statute does not prevent the Board from using Section 7412(r)(6)(C)(i)
and the subpoena power under Section 7412(r)(6)(L) to investigate.
Section 7412(r)(6)(F)’s lack of subpoena power would constrain the
Board’s authority if there were only a potential release, which is not the
case here.
12 UNITED STATES V. EXXON MOBIL CORP.
A review of the specific disputed requests confirms that
each seeks material that “might cast light on” the Board’s
investigation into the February 2015 release. See McLane I,
137 S. Ct. at 1169 (quoting Shell Oil, 466 U.S. at 68–69).
Request 1SUBDOC01 asks, in relevant part, for all risk
assessments for the alkylation unit from the past 15 years.
The Board explained that the information generally
“tend[ed] to show how Exxon[Mobil] identified hazards and
what safeguards Exxon[Mobil] implemented to prevent
incidents like the February 2015 explosion.” Because the
alkylation unit was impacted by the explosion and accidental
release, narrowly escaping significant damage to the settler
containing modified hydrofluoric acid, the risks presented
by that unit and the steps taken to minimize them were part
of the facts, conditions, and circumstances of the accidental
release. Although the time period requested is extensive, it
is appropriate in light of the age of the refinery, and the
equipment installed and modified during that period.
Request 1SUBINT01 asks for information on the
vendors and manufacturers of the modified hydrofluoric acid
in the alkylation unit, “including a list of vendors,
manufacturers, and quantity purchased annually, dates and
contact information.” The Board explained that the
“vendors and manufacturers likely have information about
the risks associated with the modified hydrofluoric acid used
in the alkylation unit . . . [that can] show the potential
consequences of a release of modified hydrofluoric acid,
which nearly occurred in the February 2015 explosion.”
This information is related to the modified hydrofluoric acid
stored in the alkylation unit at the time of the explosion and
accidental release. While no modified hydrofluoric acid was
released, its characteristics and qualities, including its
volatility and toxicity, were among the “circumstances” of
UNITED STATES V. EXXON MOBIL CORP. 13
the accidental release, which included the 40-ton flying
piece of debris that landed five feet from a settler holding the
acid. The information sought in the subpoena request was
relevant to the facts, conditions, and circumstances of the
accidental release.
Request 3SUBDOC19 asks for “[a]ll studies, reports,
analysis, data, experiments, modeling, technical analysis and
specifications related to the same or similar modified
hydrofluoric acid used in the alkylation unit at the time of
the February 18 incident,” including information about “the
documented or asserted degree of [hydrofluoric acid] vapor
suppression for modified [hydrofluoric acid], and . . . its
effectiveness in suppressing vapor compared to unmodified
[hydrofluoric acid].” The Board justified this request as
relevant because it “tend[s] to show the integrity, security,
and risks of the modified hydrofluoric acid used in the
alkylation unit, which was nearly released in the February
2015 explosion.” As with Request 1SUBINT01, the risks
posed by the modified hydrofluoric acid were among the
“circumstances” of the accidental release, and the subpoena
request is relevant to determining them.
Request 3SUBDOC20 asks for documents and
information related to “the volume and concentration of
hydrofluoric acid contained in the each of the two alkylation
unit [hydrofluoric] acid settlers at the time of the February
18 incident.” The conditions of the alkylation unit and the
settlers storing the modified hydrofluoric acid on the day of
the explosion further illuminate the facts, conditions, and
circumstances of the accidental release, making the
requested documents and information relevant.
Request 3SUBDOC43 asks for documents and
information related to “siting hazards, risks, and safety
concerns” of the alkylation unit. As with Request
14 UNITED STATES V. EXXON MOBIL CORP.
3SUBDOC20, the risks posed by the alkylation unit’s
location within the refinery were relevant to the facts,
conditions, and circumstances of the accidental release.
We recognize that the district court faced the difficult
task of evaluating 56 subpoena requests, including some
with component parts. The fact that the Board appealed only
five of the 27 denied requests speaks to that careful
consideration and work. But to the extent that the district
court in effect interpreted the Board’s legal authority to
investigate as limited to “facts, conditions, and
circumstances” that bore on the cause or probable cause of
the accidental release, it abused its discretion. Correctly
interpreting the Board’s statutory authority and applying the
generous relevance standard, the five requests whose denial
the Board appealed are relevant to the Board’s investigation
of the February 2015 accidental release. By concluding
otherwise, the district court adopted “an erroneous view of
the legal standard” governing the Board’s authority in
declining to enforce these five requests. See McLane II,
857 F. 3d at 815.
IV.
We reverse the challenged portions of the district court’s
ruling that subpoena requests 1SUBDOC01, 1SUBINT01,
3SUBDOC19, 3SUBDOC20, and 3SUBDOC43 were
unenforceable, and remand for further proceedings
consistent with this opinion.
REVERSED and REMANDED.