Johnson v. MFA Petroleum Co.
| Decision Date | 03 December 2012 |
| Docket Number | No. 12-1464,12-1464 |
| Parties | Joyce A. Johnson Plaintiff - Appellant v. MFA Petroleum Company, doing business as Break Time; Casey's General Stores, Inc.; Quiktrip Corporation Defendants - Appellees |
| Court | U.S. Court of Appeals — Eighth Circuit |
Appeal from United States District Court
for the Western District of Missouri - Kansas City
Before WOLLMAN, BEAM, and MURPHY, Circuit Judges.
On behalf of an asserted class Joyce Johnson, a citizen of Missouri, brought this action in state court against gasoline station operators MFA Petroleum, Casey's General Stores, and Quicktrip Corporation (the operators) under the Missouri Merchandising Practices Act (the state act), Mo. Rev. Stat. § 407.020, alleging the defendants misrepresent the grade of gas pumped at their stations. Casey's GeneralStores removed the case to the federal district court asserting that Johnson's claim was completely preempted by the Petroleum Marketing Practices Act (PMPA), 15 U.S.C. § 2801 et seq., or, alternatively, that there was diversity jurisdiction under the Class Action Fairness Act (CAFA), 28 U.S.C. § 1711 et seq. Johnson moved to remand, denying that her claim was completely preempted and also asserting that it fell within CAFA's local controversy exception to federal jurisdiction. The district court concluded that Johnson's claim was completely preempted by PMPA and denied her motion to remand to state court. Johnson appeals, and we reverse and remand.
Joyce Johnson is a consumer of premium grade gasoline in Missouri. She alleges that the operators misrepresent the grade of gasoline sold at their stations from "single hose blender pumps." This type of pump dispenses all available grades of gas through a single hose and nozzle after a purchaser pushes a designated button to obtain the grade each prefers. Johnson alleges that when a purchaser of premium gas uses a pump immediately after someone else has purchased a lower grade, the premium customer actually receives up to one half gallon of lower grade gas still remaining in the hose. According to Johnson, the use of this type of pump violates a Missouri statute which prohibits "[t]he act, use or employment by any person of any deception, fraud, false pretense, false promise, misrepresentation, unfair practice or the concealment, suppression, or omission of any material fact in connection with the sale or advertisement of any merchandise in trade or commerce." Mo. Rev. Stat. § 407.020.
Johnson's complaint was pled as a class action on behalf of all other citizens of Missouri who have purchased premium gasoline at one of the operators' gas stations. She seeks damages and injunctive relief on behalf of the class. Both Johnson and MFA Petroleum are citizens of Missouri, while Casey's General Stores is a citizen of Iowa and QuickTrip is a citizen of Oklahoma.
Casey's General Stores removed the case to the district court, alleging two grounds for federal question jurisdiction. First, Casey's contended that there was federal question jurisdiction under the doctrine of complete preemption. See Beneficial Nat'l Bank v. Anderson, 539 U.S. 1 (2003). According to Casey's, Johnson's allegations "attack the disclosure of octane labels on [the operators'] fuel pumps," a subject regulated by Subchapter II of PMPA. 15 U.S.C. §§ 2821, 2824. The operators assert that a preemption provision in Subchapter II, which prevents states from adopting laws with respect to "any act or omission" regulated by the subchapter, completely preempts Johnson's claim. Id. § 2824(a). Second, Casey's asserts that diversity jurisdiction exists under CAFA. It argues that all potential class members are citizens of Missouri while two of the three defendants are not, the class seeks damages exceeding CAFA's $5 million threshold, and the complaint contemplates a class size of at least 100 persons. See 28 U.S.C. § 1332(d)(2), (5).
All of the parties filed motions in the district court. The operators moved to dismiss for failure to state a claim, asserting that Johnson's claim was expressly preempted and that alternatively the operators were entitled to a safe harbor defense because they had been acting in accordance with Missouri state requirements for the pricing of their gasoline. Johnson moved to remand to state court. She argued that the doctrine of complete preemption does not apply to this case because the argument raised by the operators is merely a federal defense which does not provide federal question jurisdiction. Johnson also argues that removal was improper under CAFA because her claim fell under the statute's "local controversy" exception. See 28 U.S.C. § 1332(d)(4)(A).
The district court denied Johnson's motion to remand and granted the operators' motion to dismiss. The court determined that it had federal question jurisdiction because it concluded that Johnson's claim was completely preempted by PMPA and that dismissal was therefore required. The district court declined to address the alternative question of whether there would be diversity jurisdiction over the case under CAFA.
Johnson appeals the dismissal of the case, renewing the arguments she made in the district court questioning the availability of complete preemption here. She also urges this court to consider the merits of whether her claim fits within the local controversy exception to federal jurisdiction under CAFA. The operators respond that the district court correctly ruled that Johnson's claim is completely preempted and properly dismissed the case. If its earlier decision were to be reversed, however, the operators urge this court to direct the district court to develop the record to determine whether federal jurisdiction exists under CAFA.
Johnson argues that the district court erred by deciding that her claim is completely preempted and that there is federal question jurisdiction here. She contends that the district court was mistaken in its analysis of preemption, confusing the separate and distinct doctrines of ordinary and complete preemption. A significant difference exists between these doctrines since ordinary preemption would raise a defense against Johnson's state law claim, but it would not provide for federal jurisdiction. The "existence of a federal question is an issue of law which we review de novo." Gaming Corp. of Am. v. Dorsey & Whitney, 88 F.3d 536, 542 (8th Cir. 1996).
As master of the complaint, a state plaintiff can generally avoid removal to federal court by alleging only state law claims. Gaming Corp., 88 F.3d at 542 (citing Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987)). Under the well pleaded complaint rule, a federal question must appear on the face of the plaintiff's complaint in order to create federal question jurisdiction. Caterpillar, 482 U.S. at 392. If the plaintiff's action is brought under state law, the case may not be removed under federal question jurisdiction even if federal law were to provide a defense, and "even if both parties concede that the federal defense is the only question truly at issue." Id. at 393.
The rule that a federal defense does not create federal jurisdiction includes the defense of preemption. Id. Such a defense is not sufficient to establish federal jurisdiction even in circumstances where it appears likely that the case would eventually be dismissed on the basis of preemption. See Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 66 (1987) ().
Complete preemption only applies where a federal statute "so completely pre-empt[s] a particular area that any civil complaint raising this select group of claims is necessarily federal." Id. at 65. A conclusion that there is complete preemption effectively maintains that "the plaintiff has simply brought a mislabeled federal claim, which may be asserted under some federal statute." King v. Marriott Int'l Inc., 337 F.3d 421, 425 (4th Cir. 2003). For a statute to provide federal question jurisdiction under this exception, it must have "extraordinary pre-emptive power," a conclusion courts are reluctant to reach. See Metro Life, 481 U.S. at 65. Such caution is warranted for two reasons. First, a finding of complete preemption "significantly shifts the nature of the law that would be applied to the claim." King, 337 F.3d at 426. Second, overly aggressive application of the complete preemption doctrine would swallow up the well pleaded complaint rule in its entirety. Aaron v. National Union Fire Ins. Co., 876 F.2d 1157, 1165 (5th Cir. 1989).
Sometimes there is confusion between complete preemption and what has been termed "ordinary" preemption. See, e.g., Lontz v. Tharp, 413 F.3d, 435, 440 (4th Cir. 2005). Ordinary preemption is a federal defense that exists where a federal law has superseded a state law claim. See Nordgren v. Burlington N. R.R. Co., 101 F.3d 1246, 1248 (8th Cir. 1996). Express preemption occurs where a federal law explicitly prohibits or displaces state regulation in a given field. ERISA is a good example, for it explicitly states that, with enumerated exceptions, its provisions "shall supersede any and all State laws" relating to employee benefit plans. 29 U.S.C. § 1144(a).
Preemption may also be applied in situations where a state statute directly conflicts with federal law, Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 142-43 (1963), or in limited circumstances where "a federal law completely occupies the field of regulation so that by implication there is no room for state regulation and the coexistence of federal and state regulation is not possible." Mo. Bd. of Exam'rs for Hearing Instrument Specialists v. Hearing Help Express, Inc., 447 F.3d 1033, 1035 (8th Cir. 2006). An assertion that a state claim is preempted by federal law "is a defense to . . . [the] state law claim and not a ground for federal jurisdiction." Evans v. Missouri Pac. R.R. Co., ...
To continue reading
Request your trial
-
Inselberg v. N.Y. Football Giants, Inc., Civ. No. 2:14-cv-01317 (WJM)
...it represents an "extraordinary preemptive power," Taylor, 481 U.S. at 65, complete preemption is "quite rare." Johnson v. MFA Petroleum Co., 701 F.3d 243, 248 (8th Cir. 2012). ii. Application The Court finds that the well-pleaded complaint rule governs this case, and because Counts 8 and 1......