Martinez v. Spruce Holdings, LLC
| Decision Date | 31 August 2021 |
| Docket Number | 1:21-CV-0739 AWI SAB |
| Parties | KIM MARTINEZ, individually and as Successor In Interest to Bonnie Van Tassel, Plaintiffs v. SPRUCE HOLDINGS, LLC d/b/a Redwood Springs Healthcare Center, and DOES 1-50 inclusive, Defendants |
| Court | U.S. District Court — Eastern District of California |
ORDER ON PLAINTIFF'S MOTION TO
REMAND AND DEFENDANT'S MOTION TO DISMISS
This removed case stems from the death of decedent Bonnie Van Tassel (“Van Tassel”) from Covid 19 while she was a resident at a nursing home run by Defendant Spruce Holdings, LLC (“Spruce”). Plaintiff Kim Martinez (“Martinez”) filed a complaint in the Tulare County Superior Court and alleged three state law claims for elder abuse, willful misconduct, and wrongful death. These theories are grounded in the allegation that Spruce failed to provide appropriate services and take any appropriate safety measures (including distribution and use of personal protective equipment and monitoring staff) in dealing with the Covid 19 pandemic, despite the vulnerabilities of elderly residents like Van Tassel at Spruce. Spruce removed the matter to this Court on May 7, 2021, on the basis of federal question and federal officer jurisdiction. Currently before the Court is Plaintiff's motion to remand and Spruce's motion to dismiss. For the reasons that follow Plaintiff's motion to remand will be granted and Spruce's motion to dismiss will be denied.
A district court has “a duty to establish subject matter jurisdiction over the removed action sua sponte whether the parties raised the issue or not.” United Investors Life Ins. Co. v. Waddell & Reed, Inc., 360 F.3d 960, 967 (9th Cir. 2004). Removal statutes generally are strictly construed against removal jurisdiction. Nevada v. Bank of Am. Corp., 672 F.3d 661, 667 (9th Cir. 2012); Geographic Expeditions, Inc. v. Estate of Lhotka, 599 F.3d 1102, 1107 (9th Cir. 2010). It is presumed that a case lies outside the limited jurisdiction of the federal courts, and the burden of establishing the contrary rests upon the party asserting jurisdiction. Geographic Expeditions, 599 F.3d at 1106-07; Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009). “The strong presumption against removal jurisdiction” means that “the court resolves all ambiguity in favor of remand to state court.” Hunter, 582 F.3d at 1042; Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). That is, federal jurisdiction over a removed case “must be rejected if there is any doubt as to the right of removal in the first instance.” Geographic Expeditions, 599 F.3d at 1107; Gaus, 980 F.2d at 566. “If at any time prior to judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c); Demartini v. Demartini, 964 F.3d 813, 818 (9th Cir. 2020). “Section 1447(c) remands are mandatory because once it appears that he district court lacks subject matter jurisdiction the court must remand.” Demartini, 964 F.3d at 810; Bruns v. NCUA, 122 F.3d 1251, 1257 (9th Cir. 1997) ().
Martinez argues that there is no federal jurisdiction and that remand is mandatory. First, there is no “federal officer jurisdiction” under 28 U.S.C. § 1442(a)(1) because inter alia Spruce was not acting under the direction of a federal officer. At best, Spruce has only shown that it acted in accordance with federal guidance by the CDC, but complying with the law is insufficient to show that a person was acting under a federal officer. Second, there are only state law claims alleged. There are no important federal issues or substantial federal questions at issue. Although Spruce invokes the PREP Act, [1] that statute does not apply because the complaint is based on a failure to act. Finally the PREP Act does not meet the criteria for “complete preemption.” Without complete preemptive force, Spruce's invocation of the PREP Act cannot justify removal.
Spruce argues that federal question jurisdiction exists and that remand must be denied. First, the PREP Act is a complete preemption statute, as explained by Rachal v. Natchitoches Nursing & Rehab. Center, 2021 U.S. Dist. LEXIS 105847 (W.D. La. Apr. 30, 2021) and Garcia v. Welltower OpCo Grp. LLC, 2021 U.S. Dist. LEXIS 25738 (C.D. Cal. Feb. 10, 2021). Since Martinez's allegations fall squarely under the PREP Act, the complete preemption doctrine provides the Court with subject matter jurisdiction. Second, the HHS Secretary has determined that there is a substantial federal policy in having a uniform interpretation of the PREP Act. Further, both prongs of Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 312 (2005) are met because the Complaint seeks damages for claims relating to covered countermeasures under the PREP Act and no comity principles would be disturbed through the exercise of jurisdiction. Therefore, there is substantial federal question jurisdiction under Grable. Third, federal officer jurisdiction exists because federal directives from the CDC and CMS directed the operational decisions related to clinical pandemic response in skilled nursing homes. Spruce and other nursing homes acted to assist the duties of the CDC and CMS.
Federal courts have “original jurisdiction of all civil actions arising under the Constitution, law, or treaties of the United States.” 28 U.S.C. § 1331. “The presence or absence of federal question jurisdiction is governed by the ‘well-pleaded complaint rule,' which provides that federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint.” Rainero v. Archon Corp., 844 F.3d 832, 837 (9th Cir. 2016); California v. United States, 215 F.3d 1005 1014 (9th Cir. 2000). Under the “well-pleaded complaint” rule, courts look to what “necessarily appears in the plaintiff's statement of his own claim in the bill or declaration, unaided by anything in anticipation of avoidance of defenses which it is thought the defendant may interpose.” California, 215 F.3d at 1014. Accordingly, “a case may not be removed on the basis of a federal defense, including the defense of preemption, even if the defense is anticipated in the plaintiff's complaint and both parties concede that the federal defense is the only question truly at issue.” Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987); City of Oakland v. BP PLC, 969 F.3d 895, 904 (9th Cir. 2020); see also Vaden v. Discover Bank, 129 S.Ct. 1262, 1278 (2009) ().
Most directly and often, jurisdiction under § 1331 attaches when federal law creates the cause of action asserted. Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Manning, 136 S.Ct. 1562, 1569 (2016); Hornish v. King Cty., 899 F.3d 680, 687 (9th Cir. 2018). However, § 1331 can confer jurisdiction over a small category of state law claims where the state law claim “‘necessarily raises a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionally approved balance of federal and state power.'” Merrill Lynch¸ 136 S.Ct. at 1570 (quoting Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 315-16 (2005)); Hornish, 899 F.3d at 687-88. “That is, federal jurisdiction over a state law claim will lie if a federal issue is: (1) necessarily raised, (2) actually disputed, (3) substantial, and (4) capable of resolution in federal court without disrupting the federal-state balance approved by Congress.” Gunn v. Minton, 568 U.S. 251, 258 (2013); Hornish, 899 F.3d at 688.
Additionally, while the defense of federal preemption is insufficient confer federal question jurisdiction, Wayne v. DHL Worldwide Express, 294 F.3d 1179, 1185 (9th Cir. 2002), the doctrine of “complete preemption” does confer jurisdiction. See Caterpillar, 482 U.S. at 392; Garcia v. SEIU, 993 F.3d 757, 762 (9th Cir. 2021). Complete pre-emption is rare and has the effect of recharacterizing a state law claim into a federal law claim. Hansen v. Group Health Coop., 902 F.3d 1051, 1057-58 (9th Cir. 2018). “Once an area of state law has been completely pre-empted, any claim purportedly based on that pre-empted state law is considered, from its inception, a federal claim, and therefore arises under federal law.” Caterpillar, 482 U.S. at 392; Garcia, 993 F.3d at 762. Complete preemption for purposes of § 1331 exists when Congress (1) intended to displace a state-law cause of action, and (2) provided a substitute cause of action. City of Oakland, 969 F.3d at 906; Hansen, 902 F.3d at 1057.
Apart from § 1331, 28 U.S.C. § 1442 permits a defendant to remove a civil action to federal court if the civil action is against inter alia “any officer (or any person acting under that officer) of the United States or of any agency thereof, in an official or individual capacity for or relating to any act under color of such office . . . .” 28 U.S.C. § 1442(a)(1); Goncalves v. Rady Children's Hosp. San Diego, 865 F.3d 1237, 1243 (9th Cir. 2017). To invoke removal federal officer jurisdiction under § 1442(a)(1), a defendant must demonstrate that: (1) it is a ‘person' within the meaning of the statute; (2) there is a causal nexus between its actions and the plaintiff's claims, (3) the actions were taken pursuant to a federal officer's directions, and (4) it can assert a colorable federal defense. See Riggs v. Airbus Helicopters, Inc., 939 F.3d 981, 985 (9th Cir. 2019); Fideltad, Inc. v. Insitu, Inc., 904 F.3d 1095, 1099 (9th Cir. 2...
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