Becnel v. Lamorak Insurance Company

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

JAMES BECNEL CIVIL ACTION

VERSUS NO. 19-14536

LAMORAK INSURANCE COMPANY ET AL SECTION “B”(5)

ORDER AND REASONS

Plaintiff James Becnel filed a motion to remand, alleging

removal of the case was untimely. Rec. Doc. 7. Additionally,

plaintiff alleges the requirements for federal officer removal

are not satisfied. Id. Defendants timely filed a response in

opposition. Rec. Doc. 11. Plaintiff then sought and was granted

leave to file a reply. Rec. Doc. 14. Thereafter, parties engaged

in filing sur-replies, replies to sur-replies, and other

supplemental memoranda. The court held a hearing via

teleconference on the motion to remand on July 29, 2020 with

parties’ counsel. Post-hearing memoranda were received from all

parties. For the reasons discussed below,

IT IS ORDERED that the motion to remand is DENIED.

FACTUAL BACKGROUND AND PROCEDURAL HISTORY

This is an asbestos case. Plaintiff, James Becnel (“Becnel”)

filed a complaint, alleging negligence, in Civil District Court

for the Parish of Orleans, naming the Avondale Interest as

defendants, on July 22, 2019. Rec. Doc. 1-1. Plaintiff alleges

that defendants’ negligence in failing to warn its employees of

the risks of asbestos exposure and defendants’ further negligence

in its failure to implement proper safety procedures in handling

asbestos resulted in the plaintiff contracting asbestos-related

lung cancer resulting from plaintiff’s employment at Avondale. Id.

On August 14, 2019, plaintiff filed a first amended

supplemental petition for damages adding additional defendants.

Rec. Doc. 1-3. Plaintiff was deposed on August 29, 2019 and August

30, 2019. Rec. Doc. 1-5. Plaintiff testified that he worked on a

Lykes Vessel during his employment at Avondale. Id. at 3-16.

On November 13, 2019, Mr. Becnel died. Rec. Doc. 1-4. On

November 19, 2019 his heirs filed a second supplemental and

amending petition substituting themselves as plaintiffs,

asserting survival and wrongful death claims, and adding a

paragraph for strict liability. Id. at 2-3.

Defendants filed a notice of removal on December 11, 2019

asserting district court jurisdiction because defendants were

acting under an officer of the United States as set forth in 28

U.S.C. §1442. Rec. Doc. 1 at 2-3. Defendants assert the case became

removable after the plaintiffs filed the second supplemental and

amending petition for damages asserting strict liability claims

against the defendants. Id. at 4.

Plaintiff filed the instant motion to remand asserting that

defendants’ removal notice was untimely, and the requirements of

federal officer removal had not been satisfied. Rec. Doc. 7-1.

Defendants filed a response in opposition stating that their notice

of removal was timely filed within thirty days of the point at

which it became clear that plaintiffs’ claims were based on strict

liability. Rec. Doc. 11 at 9. Additionally, defendants’ response

in opposition assert the court has jurisdiction pursuant to 28

U.S.C. §1442.

On July 29, 2020, a hearing was held via telephone with

parties’ counsel of record. Rec. Doc. 41. Following questioning

from the court, responsive answers were given by counsel for the

parties on plaintiff’s motion to remand (Rec. Doc. 7), defendants’

opposition to plaintiff’s motion to remand (Rec. Doc. 11), and

various other relies, sur-replies and replies to sur-replies filed

by the parties. Id. Upon concluding the hearing, parties were

invited to file supplemental memoranda on a particular aspect of

the "other papers" issue that was raised sua sponte by the court.

Rec. Doc. 42. As seen infra, more than 30 days prior to filing the

removal notice, defendants knew or had reason to know from

plaintiff’s deposition they had a federal officers defense. During

relevant times here, they and their counsel, for the most part,

were actively engaged in litigation challenging circuit authority

that restricted removal in similar cases as this one, received a

dissenting panel opinion favorable to their position, and

ultimately prevailed with an en banc decision that basically agreed

with that dissent. On August 3, 2020, parties filed supplemental

memoranda (Rec. Doc. 45 and 47). Shortly thereafter, parties filed

replies to submitted supplemental memoranda. (Rec. Doc. 49 and

50).

LAW AND ANALYSIS

Timeliness of Removal

If a civil action over which the district courts of the United

States have original jurisdiction is brought in a State Court, it

“may be removed by the defendant or defendants, to the district

court of the United States for the district and division embracing

the place where such action is pending.” 28 U.S.C. § 1441(a).

Defendants must file a notice of removal pursuant to 28 U.S.C.

§1446. Generally,

“[t]he notice of a removal of a civil action or

proceeding shall be filed within 30 days after the

receipt by the defendant, through service or otherwise,

of a copy of the initial pleading setting forth the claim

for relief upon which such action or proceeding is

based,”

28 U.S.C. § 1446(b)(1).

However,

“if the case stated by the initial pleading is not

removable, a notice of removal may be filed within 30

days after receipt by the defendant, through service or

otherwise, of a copy of an amended pleading, motion,

order or other paper from which it may first be

ascertained that the case is one which is or has become

removable.”

28 U.S.C. § 1446(b)(3).

The removing party bears the burden of showing that removal was

proper, and any ambiguities are to be strictly construed in favor

of remand. See Manguno v. Prudential Prop. & Cas. Ins. Co., 276

F.3d 720, 722 (5th Cir. 2002).

The first issue before the Court in this case is a timeliness

dispute. Parties disagree as to when removal of the suit to federal

district court was proper. Additionally, there appears to be some

confusion as to the reason for removal.

Plaintiffs state that the defendants removed the case to

federal court because Becnel worked aboard the Lykes vessel, a

Navy vessel. Rec. Doc. 7-1. Plaintiffs argue that removal was

untimely as defendants had notice that Becnel worked aboard the

vessel while employed at Avondale, through Becnel’s deposition

testimony given in August 2019. Id. Plaintiffs assert that

defendants had 30 days from the date of the deposition testimony

to remove the case; thus, plaintiffs contend that removal is

untimely. Id.

The removal clock begins ticking upon receipt of

the deposition transcript” because the deposition transcript is

“other paper” under Section 1446(b)(3). Morgan v. Huntington

Ingalls, Inc., 879 F.3d 602, 610 (5th Cir. 2018). Plaintiffs nor

defendants have provided information on when the deposition

transcript was received; however, plaintiff’s depositions were

taken in August 2019 and the removal notice was filed in December

2019. Parties counsel appeared at both depositions with no

equivocation of relevant testimony given at same by plaintiff.

Judicial notice and reasonable interpretation of those timelines

would support finding the deposition transcripts were produced to

parties more than 30-days prior to the removal notice date. However

as explained in more detail later, the case was not removable due

to then existing precedent from the Fifth Circuit against removal

for a federal officer defense to mere negligence claims.

Defendants assert the case became removable on November 19,

2019 when the plaintiffs filed a second supplemental and amending

petition for damages adding strict liability claims against the

defendants. Rec. Doc. 11 at 13. Plaintiffs argue that though the

second supplemental and amending petition for damages added strict

liability claims, the claims against the Avondale Interest are

restricted to negligence, not strict liability. Rec. Doc. 7-1 at

4.

The additional paragraph added to the second supplemental and

amending petition for damages states:

“As a result of the acts of negligence, intentional

tort, fraud and strict liability of the defendants named

herein and in the Original Petition for Damages and First

Supplemental and Amending Petition for Damages, James

Becnel contracted asbestos-related lung cancer which

caused or contributed to his death on November 13, 2019,”

Rec. Doc. 1-4 at 2-3.

It is clear from the language of the paragraph that plaintiffs

assert claims for strict liability against defendants. The

defendants filed the notice of removal on December 11, 2019 within

thirty days of receiving the second supplemental and amending

petition for damages on November 19, 2019. Thus, the defendants’

notice of removal was timely.

Moreover, on September 24, 2019 the en banc Fifth Circuit

heard oral arguments in Latiolais v. Huntington Ingalls, Inc. to

address the 2011 amendment’s “relating to” language and the “causal

nexus” requirement set forth in Bartel. See Latiolais v. Huntington

Ingalls, Inc., 918 F.3d 406 (5th Cir.), reh'g en banc granted, 923

F.3d 427 (5th Cir. 2019). Under Bartel, to qualify for removal

under 28 U.S.C. §1442 (a)(1), a defendant was required to show;

(1) that it was a person within the meaning of the statute, (2)

that it had a colorable federal defense, (3) that it acted pursuant

to a federal officer’s directions, and (4) that a causal nexus

existed between its actions under color of federal office and the

plaintiff’s claims. Bartel v. Alcoa S.S. Co., 805 F.3d 169, 171

(5th Cir. 2015) (quoting Winters v. Diamond Shamrock Chem. Co.,

149 F.3d 387, 398 (5th Cir. 1998). Under prior Fifth Circuit case

authorities, negligence-only claims did not challenge actions

taken under color of federal authority; thus, negligence-only

claims lacked a causal nexus required for federal officer removal.

Legendre v. Huntington Ingalls, Inc., 885 F.3d 398 (5th Cir. 2018).

After rehearing en banc, the Fifth Circuit clarified that

removal under the 2011 amended § 1442(a) is appropriate when the

removing defendant shows “(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.” Latiolais v.

Huntington Ingalls, Inc., et al, 951 F.3d 286, 296 (5th Cir. 2020).

In so holding, that en banc decision overruled the line of cases

that relied on a “causal nexus” between the defendant’s acts

performed under color of federal authority and plaintiff’s

claims. Id. at 291, 296.

Plaintiff now argues that the Latiolais decision is not an

“order” or “other paper” that makes the case removable because the

Latiolais decision does not meet narrow circumstances allowed by

the Fifth Circuit. However, defendants contend that the Fifth

Circuit’s decision in Latiolais constitutes an “order” or “other

paper” for the purposes of removal.

Although decisions in unrelated cases typically do not

constitute grounds for removal, the Fifth Circuit has carved out

a narrow exception to this rule. In Green v. R.J. Reynolds Tobacco

Co., the court held that a decision in an unrelated case may

constitute an “order” upon which removal can be based if the same

party was a defendant in both cases, the cases involve similar

factual circumstances, and the decision resolved a legal issue

that has the effect of making the case removable. 274 F.3d 263,

268 (5th Cir. 2001).

Considering Green, we conclude that the Latiolais decision is

an “order” upon which removal can be based. First, Avondale was a

defendant in Latiolais. Second, both cases involved negligence

claims stemming from asbestos exposure that occurred while

plaintiff worked at Avondale Shipyards. Third, Latiolais changed

the standard under which cases may be removed under § 1442(a),

effectively rendering negligence-based lawsuits removable where

removal had previously been precluded.

Because plaintiff initially asserted a mere negligence claim

against defendants, it is clear that removal of that claim would

have been unwarranted as long as the causal nexus test remained

the law of this circuit. However as explained above, the Fifth

Circuit’s decision in Latiolais overruled the “causal nexus”

requirement and replaced it with the requirement that the

defendants show that “the charged conduct is connected or

associated with an act pursuant to a federal officer’s directions.”

951 F.3d at 296. Essentially, this change allows negligence claims

involving discretionary acts, such as those raised in the instant

case, to be removable under § 1442(a). As other courts in this

district have ruled, this court also concludes that the decision

in Latiolais is an “order” for the purposes of § 1446. See,

e.g., Bourgeois, 2020 WL 2488026; Francis v. ITG Brands, LLC, No.

CV 20-997, 2020 WL 2832538, at *3 (E.D. La. June 1, 2020); Jackson

v. Avondale Indus. Inc., No. CV 20-1005, 2020 WL 3510724, at *9

(E.D. La. June 29, 2020).

Having determined that removal was procedurally proper, the

court turns to the merits of the defendants’ jurisdictional

argument.

Federal Officer Removal

A civil action or criminal prosecution that is commenced in

a State court and that is against or directed to 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, may be

removed to the district court of the United States for the district

and division embracing the place where it is pending. 28 U.S.C.

§1442(a)(1). To qualify for removal under 28 U.S.C. §1442 (a)(1),

a defendant must show (1) it is a “person” within the meaning of

the statute, (2) that has acted pursuant to a federal officer’s

directions, (3) the charged conduct is connected or associated

with an act pursuant to a federal officer’s directions, and (4) it

has asserted a colorable defense. Latiolais v. Huntington Ingalls,

Inc., 951 F.3d 286, 296 (5th Cir. 2020).

Parties do no dispute that the Avondale interest is a “person”

within the meaning of the statute. Plaintiffs argue that defendants

failed to establish a causal nexus between the defendant’s

challenged conduct at issue and the defendant’s actions under the

direction of the federal government. Rec. Doc. 7-1 at 9. However,

as explained above, a showing of causal nexus is no longer

required. Defendants must only show the Avondale Interests acted

pursuant to a federal officer’s direction and that the failure to

warn Becnel of the dangers of asbestos and failure to take measures

are connected or associated with the Avondale Interests acting

pursuant to a federal officer’s direction.

This case is almost identical to Latiolais v. Huntington

Ingalls, Inc., in which the Fifth Circuit found that the pleadings

satisfied the “connection” condition of removal where Latiolais

alleged that Avondale failed to warn him of the dangers of asbestos

and failed to take measures to prevent exposure. Latiolais, 951

F.3d at 296. The Fifth Circuit found that the negligence was

connected with the installation of asbestos during the

refurbishment of a Navy vessel because Avondale performed the

refurbishment and, allegedly, the installation of asbestos

pursuant to directions of the U.S. Navy. Id. Thus, the Fifth

Circuit found that the civil action related to an act under color

of federal office. Id.

Here, the pleadings satisfy the connection requirement of

removal. Plaintiffs allege that Avondale failed to properly handle

asbestos and warn its employees of the dangers of working with

asbestos. Rec. Doc. 1-1. Submitted evidence shows the vessel Becnel

worked aboard, the Lykes vessel, was built by Avondale for the

U.S. Maritime Administration and such vessels were constructed

pursuant to Title V “Construction Differential Subsidy” of the

Merchant Marine Act, 1936 and contracts with the United States

Government. Rec. Doc. 11-1 at 4. The Lykes vessel was constructed

under the direction and pursuant with the plans and specifications

given to Avondale by the U.S. Navy. Id. Avondale’s alleged use of

asbestos was pursuant to directions of the U.S. Navy. Consequently,

the plaintiffs action relates to an act under the color of federal

office. Plaintiffs’ attempt to distinguish accountability for

using asbestos from their claims of failing to warn or provide

other protective measures in such usage do not defeat, at this

preliminary stage, the federal officer defense.

Defendants must demonstrate a colorable defense. If a defense

is plausible, it is colorable. Ashcroft v. Iqbal, 556 U.S. 662,

678–79 (2009) (plausible claim survives a motion to dismiss). To

be “colorable,” the asserted federal defense need not be “clearly

sustainable,” as section 1442 does not require a federal official

or person acting under him “to ‘win his case before he can have it

removed.’ ” Latiolais, 951 F.3d at 296 quoting Jefferson Cty.,

Ala. v. Acker, 527 U.S. 423, 431 (1999). Instead, an asserted

federal defense is colorable unless it is “immaterial and made

solely for the purpose of obtaining jurisdiction” or “wholly

insubstantial and frivolous.” Zeringue v. Crane Co., 846 F.3d 785

(5th Cir. 2017).1

The defendants raise three defenses to the plaintiffs’

claims: derivative sovereign immunity, federal contractor

immunity, and preemption by the LHWCA. Rec. Doc. 11 at 19.

Plaintiffs argue the defendant’s defenses are not colorable. Rec.

Doc. 7-1 at 20.

In Boyle v. United Techs. Corp, the Supreme Court explained

that the government contractor immunity defense “provides immunity

to contractors for conduct that complies with the specifications

of a federal contract.” Crutchfield v. Sewerage & Water Bd. of New

Orleans, 829 F.3d 370, 375 (5th Cir. 2016) (citing Boyle v. United

Techs. Corp., 487 U.S. 500 (1988). To establish a “colorable

federal defense” using the government contractor immunity defense,

a defendant must satisfy a three-part test: “(1) the United States

approved reasonably precise specifications; (2) the equipment

conformed to those specifications; and (3) the supplier warned the

United States about the dangers in the use of the equipment that

1 Overruled by Latiolais v. Huntington Ingalls, Inc., 951 F.3d 286 (5th Cir.

2020) on other grounds.

were known to the supplier but not to the United States.” Boyle,

487 U.S. at 512.

The defendants have submitted the affidavit of Christopher

Herfel, a maritime historian, the affidavit of Danny Joyce, an

industrial hygienist, and deposition testimony alleging that the

U.S. Navy generally required Avondale to install asbestos and to

comply with certain related safety practices. Rec. Doc. 11-1 and

11-2. The affidavit and deposition testimony demonstrate that the

government approved reasonably precise specifications concerning

the installation of asbestos. While plaintiffs point out

contradicting evidence in response to defendants’ submissions, the

affidavits and deposition testimony demonstrate a plausible non-

frivolous federal officer defense, at the moment.

Regarding the third factor, defendants must show that it

warned the government about the dangers in the use of the equipment

if those dangers were known to it but not to the government. Boyle,

487 U.S. at 512. Defendants submitted affidavits claiming Avondale

had no more information or knowledge than the government did about

the dangers of asbestos at the time Avondale used asbestos-

containing materials in its shipbuilding work. Rec Doc. 11-1 and

11-2. The evidence tends to show that the federal government knew

as much, and possibly more than what Avondale knew about asbestos-

related hazards and related safety measures.

The defendants have made a colorable (non-binding) showing

that it could satisfy the three Boyle factors. Thus, defendants

have stated a colorable defense of federal contractor immunity to

plaintiffs' claims. Because there is a colorable federal

contractor immunity defense under Boyle, there is no need to reach

Avondale's argument that it also has a colorable federal defense

under the Longshore and Harbor Workers' Compensation Act and

derivative sovereign immunity.

Therefore, defendants properly removed this case under 28

U.S.C. §1442 (a)(1).

New Orleans, Louisiana this 18th day of September 2020

___________________________________

SENIOR UNITED STATES DISTRICT JUDGE