## Facts

- Cape Wind Associates, LLC planned an offshore wind project on Horseshoe Shoals in Nantucket Sound, located more than three miles from the Massachusetts coastline.
- To collect site data, Cape Wind proposed a temporary scientific measurement device station (SMDS): a fixed, approximately 197-foot data-collection tower attached to the seabed.
- Cape Wind obtained a U.S. Army Corps of Engineers permit for the SMDS under federal law and did not seek Massachusetts state or local permits.
- A group of taxpayers and maritime organizations sued in Massachusetts state court to enjoin construction, alleging Massachusetts permitting requirements applied and Massachusetts had regulatory authority over the site.
- Cape Wind removed the case to federal court; the plaintiffs moved to remand for lack of federal subject-matter jurisdiction.
- The district court denied remand and dismissed for failure to state a claim, ruling Massachusetts lacked authority to impose the asserted permitting regime on the SMDS site.
- Plaintiffs appealed the denial of remand and the dismissal.

## Issues

1. Whether federal subject-matter jurisdiction supported removal when state-law claims required resolution of substantial federal questions concerning regulation of the seabed and fixed structures beyond state territorial waters.
2. Whether Massachusetts could require state or local permits for a fixed data tower located more than three miles offshore on the outer continental shelf, given federal statutes regulating offshore structures and waters.

## Decision

- The First Circuit affirmed the denial of remand, holding federal jurisdiction was proper because the claims necessarily turned on substantial questions of federal law governing offshore areas and federal permitting.
- The First Circuit affirmed dismissal for failure to state a claim, holding Massachusetts lacked authority to apply the asserted state permitting requirements to a structure fixed to the federal seabed beyond the three-mile limit.
- The court rejected plaintiffs’ theory that federal fisheries statutes expanded state authority to regulate offshore construction impacting fishing.

## Legal Principles

- Federal question jurisdiction may exist where a claim pleaded under state law necessarily depends on the resolution of substantial federal issues, including the federal allocation of authority over offshore areas and permitting of fixed structures.
- Seaward of the state territorial boundary (generally beyond three miles), the seabed and fixed structures attached to it fall under a federal regulatory regime; state permitting laws do not apply absent clear congressional authorization.
- Federal fisheries-management statutes focused on conservation and fishery regulation do not confer a general state police power to regulate offshore construction on the outer continental shelf.
- When Congress assigns regulation of offshore structures to federal agencies and federal permitting applies, state permitting requirements that would control the same offshore activity are not enforceable in that setting.

## Conclusion

The First Circuit held that removal was proper because the plaintiffs’ state-law claims depended on federal law governing offshore jurisdiction and permitting, and it upheld dismissal because Massachusetts lacked authority to require state permits for a federally permitted, fixed data tower located beyond the three-mile territorial limit on the outer continental shelf.


Ten Taxpayer Citizens Grp. v. Cape Wind Assocs., LLC, 373 F.3d 183 (1st Cir. 2004)