Ryan v. Dow Chemical Co., No. 79 Civ. 747

CourtUnited States District Courts. 2nd Circuit. United States District Court (Eastern District of New York)
PartiesMichael F. RYAN, et al., Plaintiffs, v. DOW CHEMICAL CO., Monsanto Co., Hercules Inc., T.H. Agriculture & Nutrition Co., Inc., Diamond Shamrock Chemicals Co., Uniroyal, Inc., and Thompson Chemicals Corp., Defendants. In re "AGENT ORANGE" PRODUCT LIABILITY LITIGATION. Shirley IVY, et al., Plaintiffs, v. DIAMOND SHAMROCK CHEMICALS CO., et al., Defendants.
Decision Date29 January 1992
Docket Number89 Civ. 3361,MDL No. 381.,No. 79 Civ. 747

781 F. Supp. 934

Michael F. RYAN, et al., Plaintiffs,
v.
DOW CHEMICAL CO., Monsanto Co., Hercules Inc., T.H. Agriculture & Nutrition Co., Inc., Diamond Shamrock Chemicals Co., Uniroyal, Inc., and Thompson Chemicals Corp., Defendants.

In re "AGENT ORANGE" PRODUCT LIABILITY LITIGATION.

Shirley IVY, et al., Plaintiffs,
v.
DIAMOND SHAMROCK CHEMICALS CO., et al., Defendants.

Nos. 79 Civ. 747, 89 Civ. 3361, MDL No. 381.

United States District Court, E.D. New York.

January 29, 1992.


781 F. Supp. 935
COPYRIGHT MATERIAL OMITTED
781 F. Supp. 936
Kelly L. Newman, Houston, Tex., for Clarence White

Cadwalader, Wickersham & Taft, New York City, by Michael M. Gordon, for Diamond Shamrock Chemicals Co.

Clark, Gagliardi & Miller, White Plains, N.Y. by Lynn Pucino, for T.H. Agriculture & Nutrition Co., Inc.

Lord Day & Lord, Barrett Smith, New York City by John C. Sabetta, for Monsanto Co.

Rivkin, Radler, Bayh, Hart & Kremer, Uniondale, N.Y. by Steven Brock, for Dow Chemical Co.

Shea & Gould, New York City by Myron Kalish, for Uniroyal, Inc.

Robert M. Hager, Washington, D.C., for Shirley Ivy.

MEMORANDUM AND ORDER OF REMAND

WEINSTEIN, District Judge:

 TABLE OF CONTENTS
                I. Facts .............................................................. 937
                 A. Supply of Herbicides to the United States ....................... 937
                 B. Defendants' Removal Notice ...................................... 939
                II. Law of Removal ..................................................... 939
                 A. Pleading Requirements ........................................... 940
                 1. Amendment of Removal Notice Upon Failure to Plead ............ 940
                 2. Application of Law ........................................... 941
                 B. 28 U.S.C. § 1442(a)(1) .......................................... 941
                 1. History of § 1442 ............................................ 941
                 2. Elements of § 1442(a)(1) ..................................... 944
                 a. Colorable Claim to a Federal Defense ...................... 944
                 1 Government Contractor Defense ......................... 944
                 2 Defense Production Act ................................ 945
                 b. Person Acting Under an Officer ............................ 945
                 1 Who Is a "Person"? .................................... 946
                 2 When Is a Person "Acting Under" an Officer? ........... 947
                 3. Application of Law ........................................... 950
                III. Appeal of Remand ................................................... 952
                IV. Conclusion ......................................................... 953
                

Plaintiffs Charles Brown and Clarence White were civilians in Vietnam during the war. They claim injuries from exposure to herbicides produced by defendants and used by the United States Armed Forces. These suits (the civilian actions), which sound exclusively in state law, along with companion actions by veterans and their families (the veteran actions), were commenced in Texas state court collectively under the caption Ivy v. Diamond Shamrock Chemicals Co., 89 Civ. 3361. See also Hartman v. Diamond Shamrock

781 F. Supp. 937
Chemicals Co., 90 Civ. 3928. The Ivy and Hartman actions were removed by the defendants to federal court in Texas and then transferred to this court by the Multidistrict Litigation Panel

In In re "Agent Orange" Product Liability Litigation, 781 F.Supp. 902, (E.D.N.Y.1991), the veteran actions were dismissed because the plaintiffs in those actions were members of the class whose action was settled in 1984. Consideration of subject matter jurisdiction over the civilian actions was reserved. See id.

Pending before the court are two motions. The civilian plaintiffs have moved to remand their suits to Texas state court because there is no diversity of citizenship or other ground for federal jurisdiction. The defendants have moved to amend their notice of removal in the Ivy case to add 28 U.S.C. § 1442(a)(1) on the ground that they were acting under government orders when they supplied herbicides and were therefore entitled to removal under that provision. While amendment of the notice of removal is appropriate despite the defendants' failure to mention section 1442(a)(1) in their removal notice, defendants were not acting under government officials as required by that section. Remand is therefore required.

I. FACTS

A. Supply of Herbicides to the United States

The military use of Agent Orange and other chemical defoliants in the Vietnam war has been described elsewhere. See e.g, In re "Agent Orange" Prod. Liab. Litig., 597 F.Supp. 740, 775-77 (E.D.N.Y.1984). Some basic facts bear repeating. These facts are discussed here for jurisdictional purposes only.

President Kennedy first approved the use of chemical defoliants in Vietnam toward the end of 1961, with actual spraying beginning the next year and lasting until 1971. Id. During this period, various chemical formulas were used under different names, such as Agent Purple and Agent Pink. The particular compound known as Agent Orange was used by United States forces between 1965 and 1971.

The theory of both the veteran and civilian actions is that when the United States sprayed these defoliants, it exposed the plaintiffs to dangerous levels of dioxin. Dioxin was an unwanted byproduct in the manufacture of the defoliants. Although dioxin had no herbicidal effect and was never listed as an ingredient in the defoliants, it appeared in varying amounts in the herbicides delivered by the defendants to the Defense Department. As affidavits from some defendants' employees indicate, the component elements of the herbicides delivered to the Defense Department, including the elements whose production generated dioxin, were developed and used long before the Vietnam war. See, e.g., Affidavit of John P. Frawley ¶ 2 (March 1980) (Hercules employee); Affidavit of William J. McCarville ¶ 4 (Dec. 10, 1991) (Monsanto employee); Affidavit of Michael M. Gordon ¶ 4 (Dec. 12, 1991) (Diamond Shamrock counsel); see also In re "Agent Orange" Prod. Liab. Litig., 597 F.Supp. 740, 848-49 (E.D.N.Y.1984) (noting that Agent Orange was "closely related to `shelf products' with which the chemical companies had a good deal of familiarity from the civilian market" and that "defendants had years of experience with the herbicide's components").

Initial use of chemical defoliants as weapons was relatively selective. In fiscal year 1965, for example, about 400,000 gallons of herbicides were used militarily, as compared to the 3.4 million gallons produced in the United States that year. W. Buckingham, Operation Ranch Hand: The Air Force and Herbicides in Southeast Asia 1961-1971, at 133 (1982). By

781 F. Supp. 938
fiscal year 1966, however, the military use of defoliants had increased to 1.6 million gallons annually, and the Defense Department at that time projected that it would require Agent Orange in amounts that exceeded domestic production capacity. Those projections proved overstated, however, and by 1968 the perceived supply crisis had passed

From the outset of the spraying program, federal officials, acting on behalf of the Defense Department, entered into contracts with the defendants for delivery of herbicides to the government. Most of these contracts — and all of the contracts for Agent Orange — were entered into pursuant to regulations issued by the National Production Authority (NPA) and its successor, the Business and Defense Services Administration (BDSA). The NPA and BDSA were the executive branch agencies within the Commerce Department charged with establishing regulations for obtaining materials necessary for military use under the Defense Production Act, 50 U.S.C. App. § 2061 et seq. (1988).

BDSA Regulation 2, at the time codified in 32A C.F.R. chapter VI, established a rating system by which different government orders for supplies were granted priority. From less to more urgent, the hierarchy ran: unrated orders, DO-rated orders, DX-rated orders, Mandatory Orders or Directives. See BDSA Reg. 2, §§ 3, 16. Section 10 of Regulation 2 established that all rated orders (whether DO- or DX-Rated) "must be accepted and filled regardless of existing contracts and orders," subject to certain exceptions. Section 16 of Regulation 2 made performance of all Mandatory Orders and Directives compulsory. Section 27 of Regulation 2 rendered violators of sections 10 and 16 subject to criminal fines or imprisonment.

At various times between 1962 and 1971, each of the defendants supplied Agent Orange to the government under DO-rated contracts. In 1966-1967, the expected shortage of Agent Orange caused the Executive Secretary of the BDSA to issue letters to the defendants requiring them to divert to the Defense Department what amounted to their entire civilian production of herbicides. For all orders, the government specified the chemical recipe for Agent Orange as well as the terms of its packaging and delivery. Government officials inspected defendants' production facilities. They also tested finished products to ensure compliance with contract specifications. As indicated above, however, the chemistry specified by the government was already being used by the defendants.

B. Defendants' Removal Notice

After the civilian actions were commenced as part of the Ivy action in Texas state court, defendants removed to federal court. Section 1442(a)(1) of Title 28 was not mentioned in the initial notice of removal. Instead, the removal notices in both the Hartman and Ivy cases mentioned only "artful pleading," "federal question" and "federal preemption" grounds for removal. See In re "Agent Orange" Prod. Liab. Litig., 781 F.Supp. 902, (E.D.N.Y.1991). The removal notice did cite Boyle v. United Technologies Corp., 487 U.S. 500, 108 S.Ct. 2510, 101 L.Ed.2d 442 (1988), — a case outlining the federal common law military contractor defense — but only to support the "federal preemption" basis for removal. The issue of section 1442(a)(1)'s applicability was not explicitly raised until 1991, when...

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101 practice notes
  • Krangel v. Crown, Civ. No. 91-0210-R(P).
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Southern District of California)
    • May 4, 1992
    ...first issued, the parties brought to the court's attention the 791 F. Supp. 1446 opinion of Judge Weinstein in Ryan v. Dow Chemical Co., 781 F.Supp. 934 (E.D.N.Y. 1992). Judge Weinstein addressed the issue of whether a corporation is a "person" under the federal officer removal statute, and......
  • Kuwait Pearls Catering Co. v. Kellogg Brown & Root Servs., Inc., Civ. A. H-15-0754
    • United States
    • United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Southern District of Texas
    • March 31, 2016
    ...for the Defense Department from certain liabilities stemming from the performance of those contracts." Ryan v. Dow Chemical Co., 781 F. Supp. 934, 945 (E.D.N.Y. 1992), aff'd on other grounds, 996 F.2d 1425 (2d Cir. 1993), cert. denied sub nom. Ivy v. Diamond Shamrock Chemicals Co., 510 U.S.......
  • In re Methyl Tertiary Butyl Ether ("Mtbe"), Docket No. 04-5974-cv(L).
    • United States
    • U.S. Court of Appeals — Second Circuit
    • May 24, 2007
    ...959. Because it is clear that corporations are "persons" within the meaning of the statute, see 1 U.S.C. § 1; Ryan v. Dow Chem. Co., 781 F.Supp. 934, 946 (E.D.N.Y. 1992), we turn to the requirement that the defendants have been "acting under" a federal officer. Although the district court c......
  • Winters v. Diamond Shamrock Chemical Co., No. 97-40113
    • United States
    • United States Courts of Appeals. United States Court of Appeals (5th Circuit)
    • August 17, 1998
    ...by the district court. AFFIRMED. --------------- 1 For uniformity, we refer to the plaintiff as "Winters" throughout the opinion. 2 781 F.Supp. 934 3 In addition to those four factors, we have set out a few other safeguards that must be present before estoppel may be employed. One such safe......
  • Request a trial to view additional results
101 cases
  • Krangel v. Crown, Civ. No. 91-0210-R(P).
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Southern District of California)
    • May 4, 1992
    ...first issued, the parties brought to the court's attention the 791 F. Supp. 1446 opinion of Judge Weinstein in Ryan v. Dow Chemical Co., 781 F.Supp. 934 (E.D.N.Y. 1992). Judge Weinstein addressed the issue of whether a corporation is a "person" under the federal officer removal statute, and......
  • Kuwait Pearls Catering Co. v. Kellogg Brown & Root Servs., Inc., Civ. A. H-15-0754
    • United States
    • United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Southern District of Texas
    • March 31, 2016
    ...for the Defense Department from certain liabilities stemming from the performance of those contracts." Ryan v. Dow Chemical Co., 781 F. Supp. 934, 945 (E.D.N.Y. 1992), aff'd on other grounds, 996 F.2d 1425 (2d Cir. 1993), cert. denied sub nom. Ivy v. Diamond Shamrock Chemicals Co., 510 U.S.......
  • In re Methyl Tertiary Butyl Ether ("Mtbe"), Docket No. 04-5974-cv(L).
    • United States
    • U.S. Court of Appeals — Second Circuit
    • May 24, 2007
    ...959. Because it is clear that corporations are "persons" within the meaning of the statute, see 1 U.S.C. § 1; Ryan v. Dow Chem. Co., 781 F.Supp. 934, 946 (E.D.N.Y. 1992), we turn to the requirement that the defendants have been "acting under" a federal officer. Although the district court c......
  • Winters v. Diamond Shamrock Chemical Co., No. 97-40113
    • United States
    • United States Courts of Appeals. United States Court of Appeals (5th Circuit)
    • August 17, 1998
    ...by the district court. AFFIRMED. --------------- 1 For uniformity, we refer to the plaintiff as "Winters" throughout the opinion. 2 781 F.Supp. 934 3 In addition to those four factors, we have set out a few other safeguards that must be present before estoppel may be employed. One such safe......
  • Request a trial to view additional results

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