Products Liability Law Daily Wrap Up, JURISDICTION—CHEMICAL PRODUCTS—7th Cir.: Appellate court affirms remand of Chicago’s climate-change deception suit against energy companies, (Jul 17, 2026)

By Molly Platnick

The federal officer removal statute did not apply because the lawsuit was not related to the companies’ government work.

The U.S. Court of Appeals for the Seventh Circuit affirmed the district court’s remand of a case brought by the city of Chicago against energy companies that allegedly misrepresented the dangers of fossil fuels. The companies argued they were entitled to remove the case under the federal officer removal statute because they had engaged with the U.S. government, particularly the military, since World War II. The statute entitles anyone “acting under” a federal officer “for or relating to any act under color of such office” to remove a case to federal court. The court found federal officer removal did not apply because Chicago’s complaint was too remote from the companies’ government work to be “related” within the meaning of the statute. The court’s decision was rooted in a string of recent case law denying federal officer removal in climate-change deception suits, including the Supreme Court’s holding in Chevron v. Plaquemines Par. (City of Chicago v. BP P.L.C., No. 25-1916 (7th Cir. July 15, 2026)).

Background & procedural history. The defendants are fourteen energy companies and a related trade association that extract, refine, and sell fossil fuels to end users, including the federal government. Starting during World War II, federal agencies directed some of the companies’ predecessors to provide “specialized” fossil fuels to the military. This relationship continued through the Cold War into present day, and the military still contracts with some of the defendants for fossil fuels. Beyond their work with the Army, some of the companies have “supplied and managed” the government’s Strategic Petroleum Reserve and/or received leases to extract oil from federal lands.

The city of Chicago brought this case in Illinois state court in March 2024, arguing the companies were aware of and intentionally concealed and misrepresented the “climatic effects” of burning fossil fuels. The complaint raised eleven counts, all based on state or local law, including products liability for failure to warn. The city sought monetary damages for a variety of injuries arising from “defendants’ alleged misinformation campaign,” including heat-related deaths and illness, poor air quality, and water contamination.

The energy companies removed the suit to the federal district court for the Northern District of Illinois based on the federal officer removal statute, 28 U.S.C. § 1442(a)(1). The companies argued 1442(a)(1) applied because it is impossible to distinguish greenhouse gas emissions caused by their work with the federal government from greenhouse gases from “non-governmental sources.” The district court rejected this theory and remanded the case to state court.

Federal officer removal statute. The federal officer removal statute entitles anyone “acting under” a federal officer “for or relating to any act under color of such office” to remove a case to federal court. This breaks down into a tripart test for defendants to establish § 1442(a)(1) jurisdiction: (1) it was acting under a federal officer’s authority, (2) the suit is for or relating to that authority, and (3) it has a colorable defense to the suit. In this case, the court was only concerned with the second requirement, whether the city of Chicago’s complaint related to the energy companies’ work for the federal government.

The court found the federal officer removal statute did not apply because the energy companies’ work with the government was too “attenuated” from the issues in this suit to satisfy the “relating to” requirement. Earlier this year, in Chevron v. Plaquemines Par., the Supreme Court held that conduct may “relate to” federal authority for § 1442(a)(1) purposes even if the conduct itself was not “at the behest” of a federal officer. However, the High Court stipulated that the relationship between the challenged and government conduct “must be more than tenuous, remote, or peripheral.” Here, the court determined the connection was too “tenuous” because the energy companies’ “most significant federal work” was during World War II and the challenged conduct, concealing the dangers of fossil fuels, began in the 1970s. Their more recent work, including managing the Strategic Petroleum Reserve, was also too far removed to satisfy § 1442(a)(1)’s “relating to” requirement. Chicago alleged the companies’ “disinformation campaign” led individual consumers to use more fuel; the city did not claim the misrepresentations caused the government to purchase more fuel. To test whether Chicago’s suit would “interfere” with the companies’ contracts with the federal government, the court considered: “if the [challenged conduct] were enjoined, would the defendants’ federal work be compromised?” The court decided it would not.

Even if the companies’ government work was not too attenuated, the city explicitly disclaimed “injuries arising on federal property and [from] defendants’ provision of…specialized fossil fuel products to the federal government for military…purposes.”

Case law. The court supported its decision by citing a body of recent case law suggesting that “every circuit to consider a similar question in these climate-change deception suits has found federal officer removal unwarranted.” The Supreme Court reinforced these decisions in Plaquemines, upholding rulings against energy companies that violated local laws prohibiting deceptive advertising. In two of the cases the High Court referenced, plaintiffs, like the city in this case, sought damages for “harms caused by the additional fossil fuel burned as a result of the defendants’ deception.” Those cases also included some of the same defendants as the instant case.

The court rejected the energy companies’ reading of Baker v. Atl. Richfield, where the Seventh Circuit found federal officer removal appropriate. In Baker, plaintiffs sought recovery for injuries caused by soil that was contaminated during defendants’ wartime production of materials for the federal government. By contrast, in the instant case, Chicago sought damages for misrepresentations about fossil fuel emissions, which was not related to the energy companies’ work for the government.

The court declined to answer whether § 1442(a)(1) required the defendants’ federal work to relate to the charged conduct specifically, or broader aspects of the lawsuit, like causation and damages.

The case is No. 25-1916.

Judge: Taibleson, R.

Attorneys: Rebecca A. Hirsch, City of Chicago Law Department, for the City of Chicago. Richard C. Pepperman, II (Sullivan & Cromwell LLP) for BP P.L.C. Theodore J. Boutrous, Jr. (Gibson, Dunn & Crutcher LLP) for Chevron Corp.

Companies: BP P.L.C.; Chevron Corp.

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