Shipyard’s Removal to Federal Court Granted Based on New Case Law

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In a case previously covered by Asbestos Case Tracker, the court granted plaintiff’s motion to remand after Avondale removed this case to federal court. In this instant matter, defendant Avondale  again removed this case relying on the Fifth Circuit’s opinion in Latiolais v. Huntington Ingalls, Inc., a case in which it overturned the court’s prior “causal nexus” jurisprudence and adopted a broader “relating to” test. The plaintiff again moves for remand arguing (1) that the defendant’s removal was untimely and (2) that the court lacks jurisdiction under the Federal Officer Removal Statute.

First, the plaintiff argues that removal is untimely because the Latiolais decision does not constitute an “order” or “other paper” under § 1446. The plaintiff is correct that decisions in unrelated cases generally do not constitute “orders” under § 1446. However, the court found that Avondale’s argument that an exception to this rule espoused by the Fifth Circuit in Green v. R.J. Reynolds Tobacco Company applies in this matter. In Green, the Fifth Circuit held that an order in another case can be an “order” for purposes of removing a case under § 1446(b)(3) when the two cases involve (1) the same defendants, (2) a similar factual situation, and (3) resolution of a similar legal issue that has the effect of making the case removable. The Green exception is applicable in this matter as Avondale was a defendant in the Latiolais matter, Latiolais resolved the same legal question at issue here, and both cases involve negligence claims brought against Avondale for injuries allegedly caused by exposure to asbestos. Therefore, the decision in Latiolais satisfies the Green exception and Avondale’s notice of removal was timely filed within 30 days of receipt of the Latiolais decision.

The court noted in order for Avondale to remove matter pursuant to the Federal Officer Removal Statute under revised Fifth Circuit law, Avondale must now show: “(1) it has asserted a colorable federal defense, (2) it is a ‘person’ within the meaning of the statute, (3) that has acted pursuant to a federal officer’s directions, and (4) the charged conduct is connected or associated with an act pursuant to a federal officer’s directions.” Avondale must satisfy all four elements. The plaintiff argues only that Avondale cannot satisfy the colorable federal defense element required by the Federal Officer Removal Statute. In its Notice of Removal, Avondale asserts three federal defenses to the plaintiff’s claims: (1) government contractor immunity under Boyle v. United Technologies Corp., (2) derivative sovereign immunity under Yearsley v. W.A. Ross Construction Co., and (3) immunity under the Longshore and Harbor Workers’ Compensation Act. Turning to the Avondale’s defense regarding government contractors, the court found there was a factual issue as plaintiff argued that Avondale cannot rely on Boyle because it failed to comply with the safety requirements of the Walsh-Healey Act while Avondale presented evidence that it did in fact comply with those requirements.  The court found that 1 “federal contractor defense is adequate for jurisdictional purposes when the removing party’s entitlement to it is subject to reasonable debate.” Accordingly, Avondale has presented at least one colorable federal defense.

Lastly, the plaintiff argues that Avondale cannot remove this action because it waived its right to do so by filing an opposition to plaintiff’s Motion for Summary Judgment in state court. However, the court found that Avondale filed its opposition to the plaintiff’s Motion for Summary Judgment in state court prior to the Fifth Circuit’s decision in Latiolais. Therefore, Avondale’s timely participation in the state court litigation cannot waive a right it did not yet have.

Consequently, the court denied the plaintiff’s motion and found that removal is proper.