Savoie v. Huntington Ingalls, Inc.

• Decision Date: 22 March 2016
• Docket Number: No. 15–30514.,15–30514.
• Citation: 817 F.3d 457
• Parties: Lorita M. SAVOIE; Marcia Savoie Medlin; Craig M. Savoie; Tania Savoie Alexander; Rodney A. Savoie; Greta Savoie Boudoin; Dale J. Savoie, Plaintiffs–Appellees v. HUNTINGTON INGALLS, INCORPORATED, formerly known as Northrop Grumman Shipbuilding, Incorporated, formerly known as Northrop Grumman Ship Systems, Incorporated, formerly known as Avondale Industries, Incorporated, formerly known as Avondale Shipyards, Incorporated, formerly known as Avondale Marine Ways, Incorporated; Albert L. Bossier, Jr.; J. Melton Garrett; Onebeacon America Insurance Company, as Successor to Commercial Union Insurance Company and Employers Commercial Union Insurance Company; Pennsylvania General Insurance Company, formerly known as American Employers' Insurance Company, Defendants–Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

817 F.3d 457

Lorita M. SAVOIE; Marcia Savoie Medlin; Craig M. Savoie; Tania Savoie Alexander; Rodney A. Savoie; Greta Savoie Boudoin; Dale J. Savoie, Plaintiffs–Appellees

v.HUNTINGTON INGALLS, INCORPORATED, formerly known as Northrop Grumman Shipbuilding, Incorporated, formerly known as Northrop Grumman Ship Systems, Incorporated, formerly known as Avondale Industries, Incorporated, formerly known as Avondale Shipyards, Incorporated, formerly known as Avondale Marine Ways, Incorporated; Albert L. Bossier, Jr.; J. Melton Garrett; Onebeacon America Insurance Company, as Successor to Commercial Union Insurance Company and Employers Commercial Union Insurance Company; Pennsylvania General Insurance Company, formerly known as American Employers' Insurance Company, Defendants–Appellants.

No. 15–30514.

United States Court of Appeals, Fifth Circuit.

March 22, 2016.

Gerolyn Petit Roussel(argued), Jonathan Brett Clement, Roussel & Clement, LaPlace, LA, for Plaintiffs–Appellees.

Gary Allen Lee, Esq., John Maurice Futrell, Esq., Michael Kevin Powell, Lee, Futrell & Perles, L.L.P., Samuel M. Rosamond, III(argued), Crawford Lewis, P.L.L.C., New Orleans, LA, for Defendants–Appellants.

Before CLEMENT, GRAVES, and COSTA, Circuit Judges.

COSTA, Circuit Judge:

From 1952 through 1976, the great majority of ocean-going vessels built at Avondale Shipyard¹ in Louisiana fulfilled contracts from the federal government. The specifications for these Navy and Coast Guard vessels required asbestos insulation through at least 1968. In this lawsuit brought by survivors of a worker who allegedly contracted mesotheliomawhile working at the shipyard during this time, the question is whether strict liability claims based on the existence of asbestos at the shipyard give rise to federal jurisdiction under the federal officer removal statute.

I.

Joseph Savoie was employed at the shipyard between 1948 and 1996. During his tenure there, Savoie worked both as a clean-up laborer, which involved cleaning up various insulation materials, and as a painter-blaster on vessels the shipyard constructed for the Navy and Coast Guard. The contracts between the shipyard and the government listed numerous specifications, some of which mandated that the shipyard use asbestos in the vessels' thermal insulation. The Navy utilized a quality control system to ensure that the shipyard complied with all contractual requirements, and the shipyard was required to certify compliance for each stage of a particular vessel before the government would release even a single installment payment.

The Plaintiffs contend that although the government supervised the construction of the vessels to ensure that they were in compliance with the contractual requirements, the government did not control the shipyard's safety department. The Defendants counter that the Navy inspectors were heavily involved in overseeing the construction process and had final control over any safety issues that arose.

Savoie ultimately contracted mesothelioma, allegedly as a result of asbestos exposure from working on these vessels. Before his death, he filed this suit in state court. He brought numerous negligence claims, such as failure to warn, failure to take reasonable precautions, and failure to use nonasbestos products when permitted by contract. He also brought strict liability claims. He passed away just a month after filing suit. His wife and children substituted as plaintiffs.

The Defendants² timely removed the case under the federal officer removal statute, but the Plaintiffs sought remand. The district court construed all of the Plaintiffs' claims as negligence claims. It then found that federal jurisdiction did not exist because the shipyard retained discretion in its safety policies and could have complied with both the government's requirements for the vessels' construction and its state law duties of care.

II.

Orders remanding a case to state court are generally not reviewable. See 28 U.S.C. § 1447(d). The statute governing removal procedure provides for only two exceptions: remand orders involving certain civil rights cases, 28 U.S.C. § 1443, and remand orders involving the federal officer removal statute, 28 U.S.C. § 1442. See 28 U.S.C. § 1447(d).

Our unusual ability to review a remand order in this context reflects the importance Congress placed on providing federal jurisdiction for claims asserted against federal officers and parties acting pursuant to the orders of a federal officer. See Watson v. Philip Morris Cos., 551 U.S. 142, 147, 127 S.Ct. 2301, 168 L.Ed.2d 42 (2007); Winters v. Diamond Shamrock Chem. Co., 149 F.3d 387, 398 (5th Cir.1998)(both noting that the Supreme Court has long required "liberal" construction of the statute). The reasons for federal jurisdiction in cases against federal officers and their agents borrow from the rationales for both diversity and federal question jurisdiction.³ See Watson, 551 U.S. at 150, 127 S.Ct. 2301(describing the purposes of federal officers' right to remove cases to federal court). As with diversity jurisdiction, there is a historic concern about state court bias. See id. ("State-court proceedings may reflect 'local prejudice' against unpopular federal laws or federal officials." (quoting Maryland v. Soper (No. 1), 270 U.S. 9, 32, 46 S.Ct. 185, 70 L.Ed. 449 (1926))); Willingham v. Morgan, 395 U.S. 402, 405, 89 S.Ct. 1813, 23 L.Ed.2d 396 (1969)("Obviously, the removal provision was an attempt to protect federal officers from interference by hostile state courts."). As with federal question jurisdiction, there is a desire to have the federal courts decide the federal issues that often arise in cases involving federal officers. See Watson, 551 U.S. at 150, 127 S.Ct. 2301(emphasizing the importance of "federal officials [having] a federal forum in which to assert federal immunity defenses"); see also 14C Charles Alan Wright & Arthur R. Miller, FEDERAL PRACTICE AND PROCEDURE § 3726 (4th ed.2015)(noting that one of the statute's "basic purposes" is to ensure federal officers have a "federal forum in which to assert federal immunity defenses").

Given these purposes, it is not surprising that the statute speaks in broad language allowing the removal of any state case commenced against:

The United States or any agency thereof or 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 or on account of any right, title or authority claimed under any Act of Congress for the apprehension or punishment of criminals or the collection of the revenue.

28 U.S.C. § 1442(a)(1). Recognizing that such "broad language is not limitless," even in a statute that should be afforded a "liberal construction," the Supreme Court has articulated limits based on the statute's "language, context, history, and purposes." Watson, 551 U.S. at 147, 157, 127 S.Ct. 2301(holding that a company does not "act[ ] under" an officer of the United States merely because it is subject to federal regulation). The result is a three-part inquiry for determining whether federal officer removal is proper that aims to ensure that removal occurs when there is a "federal interest in the matter." Winters, 149 F.3d at 398(quoting Willingham, 395 U.S. at 406, 89 S.Ct. 1813).

The first question is whether the defendant seeking to remove is a "person" within the meaning of the statute. Id. At first glance, this may seem like a difficult hurdle, as a private shipyard does not seem like the typical "federal officer" defendant that might face state court hostility. Yet the Supreme Court has long recognized that the removal statute also applies to private persons and corporate entities " 'who lawfully assist' the federal officer 'in the performance of his official duty.' " Watson, 551 U.S. at 151, 127 S.Ct. 2301(quoting Davis v. South Carolina, 107 U.S. 597, 600, 2 S.Ct. 636, 27 L.Ed. 574 (1883)). The current statute reflects this understanding with its "or any person acting under that officer" provision. 28 U.S.C. § 1442(a)(1).

Whether the shipyard is a "person" entitled to invoke the statute thus turns out to be the easiest inquiry. See Winters, 149 F.3d at 398(holding that a government contractor that supplied Agent Orange was a "person" that could invoke federal officer removal statute). Indeed, the parties agree that the shipyard and its executive officers constitute "persons" under the statute.

The additional two inquiries are the subject of this appeal. First is whether the federal government was directing the defendant's conduct and whether that federally-directed conduct caused the plaintiff's injuries. See Bartel v. Alcoa S.S. Co., 805 F.3d 169, 172–74 (5th Cir.2015)(explaining that mere federal involvement does not satisfy the causal nexus requirement; instead, the defendant must show that its actions taken pursuant to the government's direction or control caused the plaintiff's specific injuries). This "causal nexus" requirement is the one the district court found lacking. As a result, it did not reach the final inquiry, which is whether the defendant asserts a colorable federal defense. Id. at 172.

Before reviewing the district court's finding of no causal nexus, we note another manifestation of the statute's "liberal construction" that impacts our analysis. Although the principle of limited federal court jurisdiction ordinarily compels us to resolve any doubts about removal in favor of remand, see Acuna v. Brown & Root, Inc., 200 F.3d 335, 339 (5th Cir.2000), courts have not applied that tiebreaker when it comes to the federal officer removal statute in light of its broad reach, see Watson, 551 U.S. at 147, 127 S.Ct. 2301(emphasizing the statute's "broad language"). We thus review the district court's decision de novo, without a thumb on the remand side of the scale. See Winters, 149 F.3d at 398("[The] right [of removal] is not to be frustrated by a grudgingly narrow...