Beatty Grp. LLC v. Great W. Ry. of Colo., LLC
| Decision Date | 26 March 2020 |
| Docket Number | Civil Action No. 19-cv-01089-PAB-KLM |
| Parties | BEATTY GROUP LLC, Plaintiff, v. GREAT WESTERN RAILWAY OF COLORADO, L.L.C., Defendant. |
| Court | U.S. District Court — District of Colorado |
ORDER
This matter is before the Court on Defendant Great Western Railway's Fed. R. Civ. P. 12(b)(1) Motion to Dismiss for Lack of Subject Matter Jurisdiction [Docket No. 16].
This case arises from a dispute over the use of three parcels of land (the "parcels") in Loveland, Colorado. Docket No. 6 at 1-2, ¶ 1.1 Plaintiff Beatty Group, LLC alleges that it owns the parcels in fee simple, having purchased them from Home Depot, U.S.A., Inc. on or about December 22, 2015. Id. at 1-2, ¶ 1, and at 4, ¶ 20. The parcels were originally owned by the now-defunct Great Western Sugar Company. Id. at 2-3, ¶¶ 6-13. There are two railroad tracks currently on the parcels. Id. at 4, ¶ 21. One of those tracks, "Spur Track 1," is currently in use by defendant Great Western Railway of Colorado, LLC. Id. at 5, ¶¶ 24-26. The other, "Spur Track 2," is not currentlyin use. Id. Plaintiff believes that defendant has no legal right to use the tracks; defendant believes the opposite. Id., ¶ 26.
On March 8, 2019, plaintiff initiated this lawsuit in the District Court for Larimer County, Colorado. Docket No. 1-1. Plaintiff seeks (1) a declaratory judgment that it "owns the [parcels] in fee simple without any provisions for railroad use, easements, or ownership in the title," and (2) to quiet title to the parcels. Id. at 6-8, ¶¶ 31-40. On April 12, 2019, defendant removed the claim to this Court on the basis that the Interstate Commerce Commission Termination Act ("ICCTA"), 49 U.S.C. §§ 10101 et seq., completely preempts any remedies available under state law with respect to the regulation of rail transportation. Docket No. 1 at 3-4, ¶ 3. On April 25, 2019, defendant moved to dismiss the case pursuant to Fed. R. Civ. P. 12(b)(1) on the basis that the Surface Transportation Board ("STB") has exclusive jurisdiction over plaintiff's claims. Docket No. 16.
A motion under Fed. R. Civ. P. 12(b)(1) is a request for the Court to dismiss a claim for lack of subject matter jurisdiction. Fed. R. Civ. P. 12(b)(1). Plaintiff bears the burden of establishing that the Court has jurisdiction. Basso v. Utah Power & Light Co., 495 F.2d 906, 909 (10th Cir. 1974). When the Court lacks subject matter jurisdiction over a claim for relief, dismissal is proper under Rule 12(b)(1). See Jackson v. City and Cty. of Denver, No. 11-cv-02293-PAB-KLM, 2012 WL 4355556, at *1 (D. Colo. Sept. 24, 2012).
Rule 12(b)(1) challenges are generally presented in one of two forms: "[t]he moving party may (1) facially attack the complaint's allegations as to the existence of subject matter jurisdiction, or (2) go beyond allegations contained in the complaint by presenting evidence to challenge the factual basis upon which subject matter jurisdiction rests." Merrill Lynch Bus. Fin. Servs., Inc. v. Nudell, 363 F.3d 1072, 1074 (10th Cir. 2004) (quoting Maestas v. Lujan, 351 F.3d 1001, 1013 (10th Cir. 2003)). The court may review materials outside the pleadings without converting the Rule 12(b)(1) motion to dismiss into a motion for summary judgment. Davis ex rel. Davis v. U.S., 343 F.3d 1282, 1296 (10th Cir. 2003).
It is well established that "[t]he party invoking federal jurisdiction bears the burden of establishing such jurisdiction as a threshold matter." Radil v. Sanborn W. Camps, Inc., 384 F.3d 1220, 1224 (10th Cir. 2004). Federal courts have original jurisdiction based on a federal question when the civil action "aris[es] under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. As a general rule, federal question jurisdiction must be established on the face of a well-pleaded complaint. Louisville & Nashville R.R. Co. v. Mottley, 211 U.S. 149, 152 (1908) (); Firstenberg v. City of Santa Fe, N.M., 696 F.3d 1018, 1023 (10th Cir. 2012).
Plaintiff's complaint pleads two Colorado state law claims. Docket No. 6 at 5-7, ¶¶ 31-40. Defendant contends that the state law claims are expressly preempted by a Congressional grant of jurisdiction to the STB. Docket No. 16 at 9-10 (citing 49 U.S.C. § 10501(b)).2
Before reaching the question of express preemption, however, the Court must determine whether or not the case was properly removed to federal court under the complete preemption doctrine.3 Complete preemption and express preemption, also known as ordinary preemption, are distinct jurisdictional doctrines. See 14C Charles A. Wright et al., Federal Practice & Procedure § 3722.2 (4th ed. Aug. 2019). Complete preemption is "a corollary or exception to the well pleaded complaint rule" that allows a defendant to remove a complaint only presenting a state law cause of action to federal court "on the theory that federal preemption makes the state law claim 'necessarily federal in character.'" Schmeling v. NORDAM, 97 F.3d 1336, 1339 (10th Cir. 1996)(quoting Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64 (1987)). Express preemption, in contrast, is an affirmative defense that a plaintiff's state-law claim has been preempted by a federal statute. Cf. Felix v. Lucent Techs., 387 F.3d 1146, 1153 (10th Cir. 2004) (). As the Tenth Circuit has explained:
We read [complete preemption] not as a crude measure of the breadth of the preemption (in the ordinary sense) of a state law by a federal law, but rather as a description of the specific situation in which a federal law not only preempts a state law to some degree but also substitutes a federal cause of action for the state cause of action, thereby manifesting Congress's intent to permit removal.
Importantly, express preemption does not support removal of a complaint presenting only state-law claims to federal court. Beneficial Nat'l Bank v. Anderson, 539 U.S. 1, 6 (2003) . Thus, the Court may not proceed to consider whether plaintiff's claims are barred by express preemption before it determines whether defendant properly removed the case to this Court under the complete preemption doctrine. See Felix, 387 F.3d at 1158 ("When the doctrine of complete preemption does not apply . . . the district court, being without removal jurisdiction, cannot resolve the dispute regarding [express] preemption." (quoting Dukes v. U.S. Healthcare, Inc., 57 F.3d 350, 355 (3d Cir. 1995)).4
Complete preemption is a "rare doctrine" that represents an "extraordinary pre-emptive power." Devon Energy Prod. Co., L.P. v. Mosaic Potash Carlsbad, Inc., 693 F.3d 1195, 1204 (10th Cir. 2012).5 "[A] claim of complete preemption demands a two-part analysis: first, we ask whether the federal regulation at issue preempts the state law relied on by the plaintiff; and second, whether Congress intended to allow removal in such a case, as manifested by the provision of a federal cause of action to enforce the federal regulation." Id. at 1205. "For reasons of comity and prudence," courts begin with the second prong of the test, as the "analysis under the complete preemption doctrine is jurisdictional and therefore preliminary to any consideration of the merits." Schmeling, 97 F.3d at 1343.
In the context of the ICCTA, the analysis in Christensen v. BNSF Railway Company, 242 F. Supp. 3d 1186 (D. Kan. 2017), is instructive. In Christensen, plaintiff filed a lawsuit against defendant railway company arising out of a dispute over defendant's activity on an easement on plaintiff's property that effectively bisected the property. Id. at 1189. Plaintiff asserted state-law claims for trespass, fraud, and breach of contract, and asked the court to issue an injunction requiring defendant to install anaccess way that would permit movement between the two halves of the property. Id. The court held that the case was improperly removed to federal court because the ICCTA did not completely preempt plaintiff's injunction claim. Noting that "complete preemption occurs only where 'a federal law not only preempts a state law to some degree but also substitutes a federal cause of action for the state cause of action,'" the court determined that the "run of the mill express preemption provision" in § 10501 was insufficient to create complete preemption. Id. at 1190-91 (quoting Devon Energy, 693 F.3d at 1205). The court examined the ICCTA and concluded that "no ICCTA provision or regulation . . . gives plaintiffs a federal cause of action sufficiently similar to their state-law claims to justify applying the complete preemption doctrine," noting that the ICCTA's administrative cause of action "is available only for violations of the ICCTA's substantive provisions or accompanying regulations." Id. at 1191-92.
The Court finds the reasoning in Christensen persuasive and adopts it here. In order to satisfy the complete preemption doctrine, defendant must point to an ICCTA provision or regulation that gives plaintiff a federal cause of action sufficiently similar to its state law claims. See id.; see also Devon Energy, 693 F.3d at 1205 ().6
As the party seeking to exercise jurisdiction, it is defendant's burden to demonstrate that complete preemption is appropriate. See Radil, 384 F.3d at 1224; accord Fayard v. Ne. Vehicle Servs., LLC, 533 F.3d 42, 47 (1st...
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