Tuesday, January 6, 2026
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C.A. Revives Claims Against Petroleum Firm Alleging Failure to Warn of Climate Harm
Opinion Says Texas-Based Company’s Distribution of Fossil Fuel Products in California Is Sufficient for Exercise of Personal Jurisdiction
By Kimber Cooley, associate editor
Div. Three of the First District Court of Appeal held yesterday that a trial judge erred in finding that California lacks specific personal jurisdiction over Citgo Petroleum Corporation—a subsidiary of the Venezuelan national oil company with headquarters in Texas—as to product liability and other claims asserted against it by state and local governments alleging that its fossil fuels have contributed to significant climate harm.
Finding that the company’s history of purchasing, distributing, and selling gasoline in California is sufficient to justify the exercise of jurisdiction over it, the court rejected the company’s contention that it only acted as a “middleman” between in-state refiners and distributors, saying:
“Here, Citgo’s distribution arrangements required [gas stations owned by] 7-Eleven and Jack in the Box to utilize Citgo’s branding materials in connection with the sale of gasoline at those retail locations….By using its logo and point of purchase branding materials, Citgo ‘advertise[d] the product’ by associating the gasoline with its brand…to promote the gasoline’s sale to consumers.”
Complaints Against Oil Companies
The question of jurisdiction arose after the state and various counties filed identical complaints, between 2017 and 2023, against a number of petroleum companies, including Chevron U.S.A. Inc., Exxon Mobile Corporation, Shell USA Inc., and Citgo, asserting claims for, among other things, public and private nuisance as well as strict liability and negligence causes of action based on an alleged failure to warn of the dangers of fossil fuels. They alleged:
“Defendants…conspired to conceal and misrepresent the known dangers of burning fossil fuels, to knowingly withhold material information regarding the consequences of using fossil fuel products, to spread knowingly false and misleading information to the public regarding the weight of climate science research, and to promote their fossil fuel products which they knew were harmful….”
Alleging harms such as “a substantial rise in sea level” along the California coast as well as an “increased risk of extreme wildfire,” the plaintiffs asserted that the state has significant interests at stake in the litigation. Last May, the Judicial Council ordered that the lawsuits be heard as coordinated actions in the San Francisco Superior Court.
Motion to Quash
After Citgo moved to quash the summons and dismiss the operative complaint against it for lack of personal jurisdiction, San Francisco Superior Court Judge Ethan P. Schulman granted the motion on Dec. 17, 2024, saying:
“It is insufficient…for Plaintiffs to show that CITGO sold its products into the California market and that Plaintiffs claim to have been injured by those products….Plaintiffs’ evidence here is devoid of any jurisdictional facts regarding any actual alleged deception, which Plaintiffs acknowledge is ‘the tortious conduct at the heart of Plaintiffs’ suits.’ ”
The San Mateo County Flood and Sea Level Rise Resiliency District, along with San Mateo, Marin, and Santa Cruz counties and the cities of Imperial Beach, Richmond, and Santa Cruz, appealed. Justice Ioana Petrou authored yesterday’s opinion, joined by Presiding Justice Alison M. Tucher and Justice Victor Rodríguez, declaring:
“We shall reverse. Specific personal jurisdiction over Citgo exists as plaintiffs’ claims arose out of or related to Citgo’s contacts with California—namely, its purchase, distribution, and sale of gasoline in California—and Citgo fails to show that the exercise of personal jurisdiction over it would be unreasonable.”
Specific Jurisdiction
Noting that “[o]nly specific jurisdiction is at issue,” Petrou wrote that “a court may exercise” its powers over a “foreign defendant…such as Citgo” if the entity purposefully avails itself of the privilege of doing business in the state, the claims “arise out of or relate to” the company’s contacts with the forum, and the maintenance of the action does not offend traditional ideas of fair play and substantial justice.
The plaintiff bears the burden of establishing the first two prongs before the obligation shifts to the defendant to make a compelling case that the exercise of jurisdiction would be unreasonable.
Saying that “Citgo concedes the first prong,” Petrou opined:
“[The] plaintiffs have satisfied the second prong by demonstrating Citgo purchased, distributed, and sold fossil fuel products to California consumers via its contractual arrangements with Sears, Roebuck and Co. (Sears), 7-Eleven, Inc. (7-Eleven), and franchisees under Jack in the Box Inc. (Jack in the Box), promoted the sold products as Citgo gasoline, and did not include any materials identifying climate-related risks associated with utilizing gasoline. Because the complaint clearly encompasses claims based upon a duty to warn and asserts that Citgo failed to do so, plaintiffs have met their burden.”
Supplied Gasoline
Acknowledging that Citgo “denies refining gasoline in California or shipping refined gasoline” to the state, she pointed out that “between 1983 and 2007, it supplied gasoline ‘from California refiners/suppliers…to certain retail stations in California’ ” under contracts that allowed it to “advertise and promote” fuel sales “as [Citgo] determines is appropriate.”
Addressing the defendant’s assertion that its contacts with the state are too attenuated to support specific jurisdiction, the jurist reasoned that “[a]sbestos cases provide a useful analogy in assessing when a duty to warn arises for entities involved in the chain of distribution for inherently dangerous products” and that “courts do not require a defendant to be the direct seller of the product for liability to attach.” Based on those cases and principles, she said:
“We find plaintiffs’ claims fall directly within the scope of product liability law based on failure to warn….The record demonstrates that Citgo participated in the chain of distribution by, for example, purchasing gasoline, arranging transport, entering into various distribution agreements for its sale to California consumers through Citgo’s commercial partners, and arranging for that gasoline to be sold under its brand. And Citgo does not appear to dispute, at least for purposes of this motion, that it (1) was aware of the climate-related risks associated with fossil fuel products, and (2) did not provide any warnings related to those risks.”
As to the defendant’s contention that the court should affirm the order as to the nuisance and other claims because they “cannot turn solely on failure to warn,” she commented that “Citgo’s forum contacts are sufficient to impose specific jurisdiction over these claims.”
Fairness Considerations
Turning to whether the exercise of personal jurisdiction would be unfair, she reasoned:
“California has more than a ‘little interest’ over Citgo’s conduct. Although it did not refine gasoline in California, the evidence demonstrates Citgo purchased, distributed, and sold gasoline under its brand within California for approximately 30 years. Moreover, the fairness and reasonableness of a California forum is strengthened by California’s significant interests at stake in this litigation—providing residents with a convenient forum for redressing discrete California-specific harms that have occurred or are anticipated to occur…”
The jurist continued:
“Plaintiffs have identified specific climate-related harms arising in California….Plaintiffs also note they have had to spend significant funds, and will continue to need significant financial investment, to study and mitigate the effects of global warming in California….The alleged lack of interest by other states or the federal government in curbing climate-impacts of fossil fuel usage in California does not negate California’s interest or authority to do so.”
Saying that “[p]ermitting jurisdiction over Citgo based on its distribution of fossil fuel products…also furthers the purpose of California’s strict liability and negligence laws,” she declared:
“Citgo had sufficient notice it would be subject to suit in California, and it has not demonstrated that exerting such jurisdiction is unreasonable.”
The case is In re Fuel Industry Climate Cases, 2025 S.O.S. 55.
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