Arness v. Boeing North American, Inc., CV 97-8623 ABC MCx.

• Decision Date: 26 January 1998
• Docket Number: No. CV 97-8623 ABC MCx.,CV 97-8623 ABC MCx.
• Court: U.S. District Court — Central District of California
• Parties: James K. ARNESS, et al., Plaintiffs, v. BOEING NORTH AMERICAN, INC., a Delaware Corporation, et. al., Defendants.

997 F.Supp. 1268

James K. ARNESS, et al., Plaintiffs, v. BOEING NORTH AMERICAN, INC., a Delaware Corporation, et. al., Defendants.

No. CV 97-8623 ABC MCx.

United States District Court, C.D. California.

January 26, 1998.

Walter J. Lack, Gary Allan Praglin, Engstrom, Lipscomb & Lack, Los Angeles, CA, Thomas V. Girardi, Girardi & Keese, Los Angeles, CA, for plaintiffs.

Brad D. Brian, Stephen M. Kristovich, M. Elizabeth Deane, Munger, Tolles & Olson, Los Angeles, CA, Jeffrey S. Davidson, Steven E. Bledsoe, Kirkland & Ellis, Los Angeles, CA, for defendants.

ORDER RE: PLAINTIFFS' MOTION TO REMAND

COLLINS, District Judge.

Plaintiffs' motion to remand came on regularly for hearing before this Court on January 26, 1998. After reviewing the materials submitted by the parties, argument of counsel, and the case file, it is hereby ORDERED that Plaintiffs' motion to remand is GRANTED. Plaintiffs' request for costs and attorney's fees is DENIED.

I. Background

A. Procedural Background

On October 21, 1997, Plaintiffs James K. Arness, et. al. ("Plaintiffs") filed a complaint ("Complaint") in the Los Angeles Superior Court alleging state law causes of action against Boeing North American, Inc., et al. ("Defendants"). On November 24, 1997, Boeing North American, Inc., North American Rockwell Corporation, Rockwell Manufacturing Company, Rockwell Standard Corporation, Rocketdyne, Inc., and North American Aviation, Inc. (collectively, "BNA") filed a notice of removal to remove Plaintiffs' action to this Court based on (1) 28 U.S.C. § 1442(a)(1) (federal officer removal); (2) 42 U.S.C. § 2210(n)(2) (United States District Court has original jurisdiction over public liability actions arising out of a nuclear incident); and (3) 28 U.S.C. § 1441(a) based on the Court's original jurisdiction over actions arising from activities on a federal enclave. On December 18, 1997, the Court issued an Order to Show Cause why the matter should not be remanded for lack of subject matter jurisdiction.

Plaintiffs filed the instant motion to remand ("Motion") on December 22, 1997. On December 31, 1997, the Court signed a stipulation by the parties to continue the dates for the parties' briefs on the Court's Order to Show Cause to coincide with the briefing schedule for Plaintiffs' Motion. On January 12, 1998, BNA filed an opposition to Plaintiffs' motion on behalf of the Defendants ("Opposition"). BNA now seeks removal based solely on the Federal Officer Removal Statute, 28 U.S.C. § 1442(a)(1) ("federal officer removal"). Plaintiffs filed reply papers on January 20, 1998 ("Reply").

B. Factual Background Relevant to the Instant Motion

This action stems from the alleged release and disposal of trichloroethylene ("TCE") and other toxic chemicals by BNA and the other Defendants from their activities at the "Rocketdyne Facilities,"¹ which allegedly resulted in the contamination of the surrounding area's groundwater, soil, and subsurface soil. Compl. at ¶ 1. Plaintiffs allege that their exposure to these chemicals has caused them both personal injury and damage to their real and personal property. Id. at ¶ 2.

BNA manufactured and tested rocket engines at portions of the Rocketdyne Facilities pursuant to contracts with the United States government. Bradley Decl. ¶ 2. Plaintiffs allege that in the process of "testing, developing and researching rocket engines," the Defendants negligently allowed TCE and other toxic substances to enter the soil and groundwater. Compl. at ¶ 31. Specifically, Plaintiffs allege that the contamination occurred through Defendants' (1) storage of solvents, including TCE; (2) use of TCE and other solvents to flush rocket engine hardware; (3) disposal of toxic solvents "through recycling, inadvertent dumping and intentional dumping;" (4) use of unlined and lined "surface impoundment and onsite creeks ... to dispose of solvents;" (5) dumping of "solvents through the connections of solvent drains into old septic systems, causing leakage from surface impoundments and piping and leakage from solvent storage barrels; and (6) "[i]ntentionally dumping volatile organic compounds and industrial solvents." Id.

BNA asserts that it performed its rocket engine contracts at "the direction of federal officers pursuant to detailed and comprehensive procedures dictated by these officers." Barrett Decl. ¶ 5. Specifically, one of BNA's test engineers, Ernest Barrett, declares that "[t]he Department of Defense and NASA imposed the use of TCE as a contractual requirement in the manufacturing and test operations" of rocket engines. Id. ¶ 7; Halchak Decl. ¶ 7. The TCE was used to "flush" the rocket engines to "eliminate the potential for fire or explosion upon subsequent hot fire test or missile launch." Barrett Decl. ¶ 7. Finally, Barrett declares that "designees and agents of the Administrator of NASA, the Secretary of the Air Force and the Secretary of Defense were present to oversee ... and ... had the authority to stop" the TCE flushing operations. Barrett Decl. ¶ 10.

II. Discussion

A. Standard

1. Removal Generally

Removal jurisdiction is governed entirely by statute. See 28 U.S.C. § 1441, et seq. Courts in the Ninth Circuit apply a "`strong presumption' against removal jurisdiction," with the result that "the defendant always has the burden of establishing that removal is proper." Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir.1992) (citing Nishimoto v. Federman-Bachrach & Assocs., 903 F.2d 709, 712 n. 3 (9th Cir.1990); Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir.1988)). "Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance." Id. (citing Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir.1979)).

2. Federal Officer Removal Statute

Section 1442(a)(1) of Title 28 of the United States Code provides that "[a]ny officer of the United States ... or person acting under him, for any act under color of such office" may remove a pending state action to a district court of the United States. The defendant seeking federal officer removal must satisfy a two-part test. First, the defendant must raise a colorable federal defense to plaintiffs' claims. Mesa v. California, 489 U.S. 121, 139, 109 S.Ct. 959, 970, 103 L.Ed.2d 99 (1989). Second, the defendant must establish that it acted under the direction of a federal officer by demonstrating "a causal nexus between plaintiffs' claims and acts it performed under color of federal office." Fung v. Abex Corp., 816 F.Supp. 569, 571-72 (N.D.Cal.1992); see also Maryland v. Soper (No. 1), 270 U.S. 9, 33, 46 S.Ct. 185, 190, 70 L.Ed. 449 (1926); Ryan v. Dow Chemical Co., 781 F.Supp. 934, 939 (E.D.N.Y.1992). Before applying this test, however, "a defendant must qualify as a `person' for the purposes of 28 U.S.C. § 1441(a)(1)." Overly v. Raybestos-Manhattan, 1996 WL 532150 (N.D.Cal.) at *2 (citing Fung, 816 F.Supp. at 572). A defendant who successfully establishes these requirements "gain[s] access to federal court [even] where no federal question is presented by the plaintiff." Ryan, 781 F.Supp. at 939; see also Blackman v. Asbestos Defendants, 1997 WL 703773 (N.D.Cal.) at *2.

B. Analysis of Federal Officer Removal

1. Corporation as "Person" in Context of 28 U.S.C. § 1442(a)(1)

While the Supreme Court has held that government agencies are not included within the term "person" for purposes of Section 1442(a)(1),² the Court did not decide whether a corporation acting under a federal officer qualifies as a "person" for purposes of federal officer removal. International Primate Protection League v. Administrators of Tulane Educational Fund, 500 U.S. 72, 83-87, 111 S.Ct. 1700, 1707-09, 114 L.Ed.2d 134 (1991); see also Fung, 816 F.Supp. at 572; Ryan, 781 F.Supp. at 946. There appears to be a split of authority, even within the Ninth Circuit, as to whether Congress intended to give corporations removal power under Section 1442(a)(1). Compare Blackman, 1997 WL 703773 at *2 (finding that word "person" includes corporations); Ruffin v. Armco Steel Corp., 959 F.Supp. 770, 773 (S.D.Tex. 1997) (reading "person" expansively to include corporations "delegated responsibility to carry out directives of the federal government"); Overly, 1996 WL 532150 at *2 (finding defendant corporation a person); Good v. Armstrong World Indus., 914 F.Supp. 1125, 1127-28 (E.D.Pa.1996) (including corporations within definition of "person"); Fung 816 F.Supp. at 572 (same); Ryan, 781 F.Supp. at 946-47 (explaining that corporations "could be engaged in activities that amount to the implementation of a federal policy under the direction of a government officer," and thus can be persons under § 1442(a)(1)); with Arnold v. Blue Cross & Blue Shield of Texas, 973 F.Supp. 726, 739 (S.D.Tex.1997) (disagreeing with holdings that corporations qualify as persons for purposes of § 1442(a)(1)); Krangel v. Crown, 791 F.Supp. 1436, 1446 (S.D.Cal.1992) (holding that defendant corporation is not a "person" under § 1442(a)(1) based on "purpose of the statute, the fact that ambiguities should be resolved against federal jurisdiction, and the strong interest of the states in adjudicating the rights and obligations of their citizens").

Plaintiffs urge the Court to "follow the analysis and holding of its sister California District Court, the District Court for the Southern District of California ... and find that corporations do not fall within the protections of the Federal Officer Removal Statute." Mot. at 12:5-8. BNA contends, however, that "the overwhelming weight of authority confirm that private corporations are within the ambit of the statute." Opp. at 15:21-22. Thus, BNA argues that the Court should reject the holding of Krangel, and adopt the analysis of the Northern District of California in Fung, finding that Section 1442(a)(1) applies to corporations. Id. at 17:1-6.

Although the authority presented to the Court is conflicting, the trend in the case law appears to be...