Ohana Military Communities, LLC v. Lake

Marine Corps Base Hawaii (MCBH) is a federal enclave over which Hawaii and the United States have concurrent legislative authority. Members of military families who leased housing at MCBH filed suit in Hawaii state court alleging Hawaii-law claims against the companies that own and manage housing at MCBH, based on the companies’ failure to disclose pesticide contamination. The companies removed the case to federal court, and the district court denied the plaintiffs’ motion to remand the case to state court. On appeal, the Ninth Circuit held that the federal courts lacked subject-matter jurisdiction over the plaintiffs’ claims. The court explained that, when the United States has exclusive legislative jurisdiction over an enclave, state laws within the enclave lose their character as state law and become federal law that can serve as the basis for federal-question jurisdiction. In contrast, when a state has concurrent legislative jurisdiction over an enclave, state laws retain their character as state law, and claims arising under those laws do not arise under federal law for federal-question purposes. The court also rejected the defendants’ argument that the courts had federal-question jurisdiction under Grable & Sons Metal Products, Inc. v. Darue Engineer­ing & Manufacturing, 545 U.S. 308, 314 (2005), because the defendants did not show that the claims “necessarily raise” a federal issue.

Serving as co-counsel for the plaintiffs in the Supreme Court, Public Citizen prepared the brief in opposition to the petition. In June 2022, the Court denied the petition.