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Dougherty v. AO Smith Corporation

United States District Court, D. Delaware

July 16, 2014

FRANCIS J. DOUGHERTY AND ELIZABETH F. DOUGHERTY, Plaintiffs,
v.
A O SMITH CORPORATION, et al., Defendants.

REPORT AND RECOMMENDATION

SHERRY R. FALLON, Magistrate Judge.

I. INTRODUCTION

Presently before the court in this asbestos-related personal injury action is a Motion to Remand (the "Motion to Remand" or "Motion") filed by the Plaintiffs, Francis J. Dougherty and Elizabeth F. Dougherty ("Plaintiffs"), in response to the notice of removal filed by Defendant Crane Company ("Crane") pursuant to 28 U.S.C. § 1442(a)(1). (D.I. 14) Plaintiffs contend that remand is appropriate because they disclaimed any causes of action that could provide a basis for federal subject matter jurisdiction and, alternatively, that Crane has not met the requirements for removal under Section 1442(a)(1). (D.I. 14 at 2) Crane opposes Plaintiffs' Motion. (D.I. 22) For the reasons that follow, I recommend that the court GRANT Plaintiffs' Motion to Remand.

II. BACKGROUND

Plaintiffs filed this action against Crane and other defendants on October 4, 2013, in the Superior Court of Delaware. (D.I. 1, Ex. 1) The Complaint alleges that Francis J. Dougherty ("Mr. Dougherty") developed mesothelioma, among other injuries, as a result of his exposure to asbestos-containing products manufactured by, sold by, distributed by, or otherwise associated with the defendants, including Crane. ( Id, Ex. 1 ¶¶ 1-6) Mr. Dougherty was allegedly exposed to such asbestos-containing products while working as a plumber in the U.S. Navy from 1945 to 1946, as a plumber and pipefitter in Wilmington, Delaware from 1950 to 1993, and as a volunteer fireman in New Castle County, Delaware. ( Id. ¶ 2)

Plaintiffs' Complaint includes the following disclaimer:

3. Plaintiffs hereby disclaim any cause of action or claim for recovery that could give rise to federal subject matter jurisdiction under either 28 U.S.C. § 1331 (federal question) or 28 U.S.C. § 1442, subdivision (a)(1) (federal officer). Specifically, Plaintiffs disclaim any cause of action or claim for recovery based on any exposure to asbestos on land that is, or was, a "federal enclave" pursuant to Article I, section 8, clause 17 of the United States Constitution. Plaintiffs also disclaim any cause of action or claim for recovery based on any exposure to asbestos caused by any person or entity acting under the authority of a federal officer or agency.

( Id. ¶ 3)

On November 25, 2013, Crane removed the action to this court, pursuant to 28 U.S.C. § 1442(a)(1), the federal officer removal statute. (D.I. 1) Plaintiffs filed the pending Motion to Remand on December 20, 2013. (D.I. 14) Briefing on the Motion was completed by January 2014. ( See D.I. 27)

In their papers filed in support of remand, Plaintiffs assert, among other things:

"Plaintiffs have disclaimed and hereby waive as the basis for any relief in this case" "exposures that may have occurred during Mr. Dougherty's service in the United States Navy from 1945-1947." (D.I. 14 at 2 (emphasis added))
"To the extent necessary, Plaintiffs also hereby waive all claims against Crane stemming from Mr. Dougherty's asbestos exposure from any federal government job site, and aboard Navy ships or any other military vessel." (D.I. 15 at 4)

III. LEGAL STANDARD

The federal officer removal statute permits removal of a state court action to federal court when, inter alia, such action is brought against "[t]he United States or an agency thereof of any officer (or any person acting under that officer) of the United States or of any agency thereof, sued in an official or individual capacity for any act under color of such office." 28 U.S.C. § 1442(a)(1). The party removing an action to federal court bears the burden of proving that removal is appropriate. See Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990). In the Third Circuit, the provisions of the federal officer removal statute are to be "broadly construed."[1] Sun Buick, Inc. v. Saab Cars USA, Inc., 26 F.3d 1259, 1262 (3d Cir. 1994). The Supreme Court has explained that "the right of removal is absolute for conduct performed under color of federal office, and has insisted that the policy favoring removal should not be frustrated by a narrow, grudging interpretation of § 1442(a)(1).'" Arizona v. Manypenny, 451 U.S. 232, 242 (1981) (citation omitted).

To properly establish removal under Section 1442(a)(1), a defendant must show the following:

(1) it is a "person" within the meaning of the statute;
(2) the plaintiff's claims are based upon the defendant's conduct "acting under" a federal office;
(3) it raises a colorable federal defense; and
(4) there is a causal nexus between the claims and the conduct performed under color of a federal office.

Feidt v. Owens Corning Fiberglas Corp., 153 F.3d 124, 127 (3d Cir. 1998) (citing Mesa v. California, 489 U.S. 121, 129 (1989)).

As to the first element of the statute, this court has held that "defendants, as corporations, are persons' within the meaning of [Section 1442(a)(1)]." In re Asbestos Litig. (Seitz), 661 F.Supp.2d 451, 454 (D. Del. 2009) (citing Good y. Armstrong World Indus., Inc., 914 F.Supp. 1125, 1128 (E.D. Pa. 1996)). See also Kirks v. GE, 654 F.Supp.2d 220, 223 (D. Del. 2009).

To satisfy the second element, the defendant "must demonstrate that a federal office' was the source of the specific act for which the contractor now faces suit." In re Asbestos Litig. (Seitz), 661 F.Supp.2d at 454. "The second factor has been described as requiring a showing that the acts forming the basis of the state suit were performed pursuant to an officer's direct orders or comprehensive and detailed regulations.'" Id. (quoting Good, 914 F.Supp. at 1128).

The third element "requires a moving defendant to demonstrate that there is a colorable defense to a plaintiff's claims." Id. (citing Megill v. Worthington Pump, Inc., 1999 WL 191565, at *3 (D. Del. Mar. 26, 1999)). The colorable defense asserted here is the federal common law government contractor defense. According to the Supreme Court, a federal contractor will not be liable for design defects in equipment under state tort laws when:

(1) the United States approved reasonably precise specifications;
(2) the equipment conformed to those specifications; and
(3) the supplier warned the United States about the dangers in the use of the equipment that were known to the supplier but not to the United States.

Boyle v. United Techs. Corp., 487 U.S. 500, 512 (1988).

Although the Boyle Court applied the government contractor defense to a design defect products liability claim, federal courts have subsequently recognized the applicability of the defense to state law failure to warn clams. See, e.g., McQueen v. Union Carbide Corp., 2013 WL 6571808, at *3 (D. Del. Dec. 13, 2013), report and recommendation adopted, 2014 WL 108535 (D. Del. Jan. 9, 2014); Walkup v. Air & Liquid Sys. Corp., 2013 WL 5448623, at *2 (D. Del. Sept. 26, 2013), report and recommendation adopted, 2013 WL 5798701 (D. Del. Oct. 24, 2013); In re Asbestos Litig. (Seitz), 661 F.Supp.2d at 454; Kirks, 654 F.Supp.2d at 224-25. "However, because design defect and failure to warn claims differ practically as well as theoretically, ' courts have required the government approval to transcend rubber stamping' for the defense to shield a government contractor from failure to warn liability."[2] Hagen, 739 F.Supp.2d at 783 (quoting Tate v. Boeing Helicopters, 55 F.3d 1150, 1156-57 (6th Cir. 1995)). Consequently, in cases involving failure to warn claims, federal courts have tailored the Boyle elements as follows:

(1) the United States exercised its discretion and approved the warnings, if any;
(2) the contractor provided warnings that conformed to the approved warnings; and
(3) the contractor warned the United States of the dangers in the equipment's use about which the contractor knew, but the United States did not.

MacQueen, 2013 WL 6571808, at *4 (quoting Hagen, 739 F.Supp.2d at 783). See also Oliver v. Oshkosh Truck Corp., 96 F.3d 992, 1003-04 (7th Cir. 1996); Tate, 55 F.3d at 1157.

The final requirement for removal under Section 1442(a)(1) is that the defendant demonstrate a causal nexus between the conduct being supervised by the federal office and the conduct deemed offensive in the plaintiff's complaint. See In re Asbestos Litig. (Seitz), 661 F.Supp.2d at 455. "To do so, a defendant seeking removal must by direct averment exclude the possibility that [the defendant's action] was based on acts or conduct of his not justified by his federal duty.'" Hagen, 739 F.Supp.2d at 785 (alteration in original) (quoting Mesa, 489 U.S. at 132).

IV. DISCUSSION

I recommend that the court grant Plaintiffs' Motion to Remand. In reaching this determination, however, two related points are noted from the outset. Specifically, Plaintiffs' disclaimer in paragraph three of the Complaint (the "jurisdictional disclaimer") has no effect on Crane's right of removal, and Crane has asserted a colorable federal defense to certain of Plaintiffs' claims. Thus, Crane's removal of this action was proper. Nevertheless, remand is appropriate, pursuant to 28 U.S.C. § 1367(c), based on Plaintiffs' post-removal disclaimer of any claims relative to Mr. Dougherty's alleged exposure to asbestos during his service in the U.S. Navy and on any federal jobsites and vessels (the "claim disclaimer").

A. Plaintiffs' Jurisdictional Disclaimer in Paragraph Three of the Complaint

Plaintiffs contend that Crane's removal of this action was improper because they "expressly disclaimed in their Complaint any claims or relief attributable to Mr. Dougherty's service in the United States Navy." (D.I. 14 at 2) Plaintiffs' contention is without merit, for two reasons.

First, Plaintiffs' jurisdictional disclaimer is inconsistent with the allegations of the Complaint, rendering the disclaimer ambiguous. Paragraph three of the Complaint provides, in pertinent part:

3. Plaintiffs hereby disclaim any cause of action or claim for recovery that could give rise to federal subject matter jurisdiction under either 28 U.S.C. § 1331 (federal question) or 28 U.S.C. § 1442, subdivision (a)(1) (federal officer). Specifically, Plaintiffs disclaim any cause of action or claim for recovery based on any exposure to asbestos on land that is, or was, a "federal enclave".... Plaintiffs also disclaim any cause of action or claim for recovery based on any exposure to asbestos caused by any person or entity acting under the authority of a federal officer or agency.

(D.I. 1, Ex. 1 ¶ 3) In the immediately preceding paragraph, however, Plaintiffs claim that Mr. Dougherty was exposed to asbestos while serving in the Navy (i.e., on a federal jobsite and/or vessel). Specifically, Plaintiffs assert:

a. Plaintiff Francis Dougherty experienced occupational exposure to asbestos while serving as a plumber in the United States Navy from 1945-1946. He inhaled, ingested and otherwise absorbed asbestos-containing fibers emanating from various products including, but not limited to, gaskets, packing from equipment including pumps, valves and other equipment.

( Id 112(a)) Thus, the disclaimer is ambiguous. On the one hand, Plaintiffs seek to hold Crane liable for the alleged asbestos exposure relating to Mr. Dougherty's work for the Navy; on the other, Plaintiffs claim that Crane has no right to remove on the basis of a colorable federal defense. See Despres v. Ampco-Pittsburgh Corp., 577 F.Supp.2d 604, 608 (D. Conn. 2008). "Plaintiffs cannot have it both ways." Id.

Second, and more importantly, the majority of federal courts have found that jurisdictional disclaimers in complaints, like the one in Plaintiffs' Complaint, are ineffective to avoid ...


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