Eaton v. Woodlawn Manor Inc

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF LOUISIANA

MONROE DIVISION

TARA EATON, ET AL. CASE NO. 3:21-cv-01337

VERSUS JUDGE TERRY A. DOUGHTY.

WOODLAWN MANOR AND MAG. JUDGE KAYLA D. MCCLUSKY

LOUISIANA NURSING HOME

ASSOCIATION LIABILITY TRUST

REPORT AND RECOMMENDATION

Before the undersigned is a motion to dismiss for failure to state a claim and for improper

venue filed by Defendants, Woodlawn Manor, Inc., doing business as The Oaks (“The Oaks”)

and Louisiana Nursing Home Association Liability Trust (“LNHAT”), together referred to as

Defendants. [doc. #6]. Plaintiffs, Tara Eaton, Cathy Eleam, Tamara Fitch, Sharon Caldwell

Williams, and John Dixon (“Plaintiffs”) oppose this motion. [doc. #13].

For the reasons assigned below, it is RECOMMENDED that the Court GRANT the

motion IN PART, DISMISS Plaintiffs’ claims for relief under the Americans with Disabilities

Act and Medicare and Medicaid regulations, and REMAND Plaintiffs’ remaining state law

claims to the 4th Judicial District Court of Ouachita Parish, Louisiana.

I. BACKGROUND

On March 11, 2020, the World Health Organization declared Covid-19, a virus causing

flu-like symptoms and often more severe complications, such as blood clots, strokes, and death, a

global pandemic. [doc. #1-1]. In April 2020, Plaintiffs, with the exception of Plaintiff Dixon,

were employed by The Oaks, a nursing facility in Monroe, Louisiana. Id. Plaintiffs claim that,

during this time, they contracted Covid-19 due to The Oaks’s failure “to take appropriate

measures for a public health crisis such as prompt and strict compliance with applicable

regulations and guidelines.” Id. Specifically, Plaintiffs claim that, during this time, they were

not provided proper personal protective equipment (“PPE”) and were not allowed to bring their

own. Id. Plaintiffs also allege that The Oaks failed to properly clean and sanitize the facility,

screen residents and staff for Covid-19, enforce social distancing among the residents, isolate

residents suspecting of having the virus, and send home employees who exhibited virus

symptoms. Id. Plaintiffs claim that Defendants’ failure to comply with applicable regulations

violated state and federal law, as well as public health guidelines. Id. Plaintiff Dixon, the live-in

boyfriend of Plaintiff Caldwell Williams, claims he contracted the virus as a result of The Oaks’s

conduct because Ms. Williams contracted the virus at work and passed it to him.1 [doc. #13].

After Plaintiffs filed suit in state court, Defendants removed the case to this Court,

claiming that Plaintiffs assert claims “arising under” federal law within the meaning of 28 U.S.C.

§ 1331. [doc. #1]. Specifically, Defendants allege that Plaintiffs have made claims under the

Americans with Disabilities Act of 1990 (the “ADA”), 42 U.S.C. § 12101, et seq.; federal

Medicare and Medicaid laws and regulations (“CMS2 regulations”); and the Public Readiness

and Emergency Preparedness Act (“PREP Act”), 41 U.S.C. § 247d-6d, 247d-6e. Id. Although

Defendants concede that Plaintiffs alleged state law claims for “gross negligence,” Defendants

claim the PREP Act expressly preempts all state law claims that Plaintiffs have asserted. [doc.

1 In their Petition, Plaintiffs alleged that they were all employed by The Oaks, but they clarify in

their memorandum with regard to Dixon.

2 CMS is an abbreviation for the Centers for Medicare and Medicaid Services.

#1]. Defendants further asserted in their Notice of Removal that the Court has supplemental

jurisdiction over Plaintiffs’ state law claims pursuant to 28 U.S.C. § 1367(a).

The PREP Act, passed in 2005, is a federal statute which provides the Secretary of Health

and Human Services (the “Secretary”) the authority to issue declarations determining that “a

disease or other health condition or other threat to health constitutes a public health emergency.”

41 U.S.C. § 247d-6d(b). Once a declaration has been issued, the PREP Act applies broad

immunity to covered persons for liability arising from the use or administration of a covered

countermeasure relating to the subject of the declaration. 41 U.S.C. § 247d-6d(a)(1). In March

2020, the Secretary issued a declaration relating to Covid-19. 85 Fed.Reg. 15,198 (Mar. 17,

2020). As a result, the PREP Act immunizes conduct which leads to Covid-19 related-death or

injuries, provided the defendant constitutes a “covered person” and the covered person’s alleged

conduct constitutes “covered countermeasures.”

II. LEGAL STANDARD

The Federal Rules of Civil Procedure allow dismissal of a claim for “failure to state a

claim upon which relief can be granted.” FED.R.CIV.P. 12(b)(6). To state a claim, the pleading

must contain a “short and plain statement . . . showing that the pleader is entitled to relief . . .”

FED.R.CIV.P. 8(a)(2). While the pleading need not assert detailed factual allegations, it must

“state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544,

555 (2007). A claim is plausible on its face “when the pleaded factual content allows the court

to draw the reasonable inference that the defendant is liable for the misconduct alleged.”

Ashcroft v. Iqbal, 556 U.S. 663 (2009).

In deciding a motion to dismiss, the Court must accept as true all of the plaintiff’s

allegations, unless the allegation is a “threadbare recital[] of a cause of action’s elements,

supported by mere conclusory statements.” Id. Although legal conclusions may be asserted,

“they must be supported by factual allegations” to gain the assumption of truth. Id. at 664. A

well-pleaded complaint may proceed even if it strikes the Court that actual proof of the asserted

facts is improbable, and that recovery is unlikely. Twombly, 550 U.S. at 556. Nevertheless, the

Court may dismiss a complaint “if it clearly lacks merit – for example, where there is an absence

of law to support a claim of the sort made.” Thurman v. Med. Transp. Mgmt., Inc., 982 F.3d

953, 956 (5th Cir. 2020) (citations and internal quotation omitted).

III. DISCUSSION

Plaintiffs assert multiple claims against Defendants for their alleged failure to properly

protect Plaintiffs from exposure to Covid-19. [doc. #1-1]. Plaintiffs expressly bring state law

claims for negligence and/or gross negligence and allude to claims arising under the ADA and

CMS. Id. In their motion to dismiss, Defendants list a host of reasons that Plaintiffs’ claims

should be dismissed. [doc. #6]. Among others, Defendants contend, inter alia, that Plaintiffs’

claims are barred by the PREP Act and two Louisiana state statutes, all of which Defendants

claim provide immunity for the decisions they made relating to Covid-19. Id. Defendants also

assert that Plaintiffs’ ADA claims under Title I and Title III must be dismissed for failure to

exhaust administrative remedies prior to seeking judicial relief and that, alternatively, Plaintiffs’

Title III ADA claims must be dismissed because they seek damages when that title provides for

only injunctive relief. Defendants also move for dismissal of Plaintiffs’ claim under the CMS

regulations because there is no private cause of action in favor of third parties. Id.

A. Plaintiffs’ Claims Under the ADA

Defendants argue that Plaintiffs’ ADA claims must be dismissed because Plaintiffs failed

to exhaust administrative remedies before filing suit, whether they seek to proceed under Title I

or Title III of the ADA. They further contend that Title III of the ADA provides only for

injunctive relief, not the damages Plaintiffs seek. Plaintiffs failed to oppose Defendants’ ADA

arguments.

Title I of the ADA addresses disability-based employment discrimination and provides

that “[n]o covered entity shall discriminate against a qualified individual on the basis of

disability in regard to job application procedures, the hiring, advancement, or discharge of

employees, employee compensation, job training, and other terms, conditions, and privileges of

employment.” 42 U.S.C. § 12112(a). Employees (or former employees) who assert claims under

Title I must follow the procedures applicable to procedures under Title VII of the Civil Rights

Act of 1964, 42 U.S.C. § 2000e, et seq., including the requirement that they timely file a charge

with the Equal Employment Opportunity Commission (“EEOC”). See 42 U.S.C. § 12117(a); see

also Dao v. Auchan Hypermarket, 96 F.3d 787, 789 (5th Cir. 1996) (“We join those courts in

holding that an employee must comply with the ADA’s administrative prerequisites prior to

commencing an action in federal court against her employer for violation of the ADA. As the

district court correctly noted, the ADA incorporates by reference the procedures applicable to

actions under Title VII.”). Employees typically assert one of two theories of recovery under the

ADA: failure to accommodate or discrimination. Under either theory, the employee is required

to show that he is a “qualified individual” for the purposes of the ADA, or a person “who, with

or without reasonable accommodation, can perform the essential functions” of his job. 42 U.S.C.

§ 12111(8); Cleveland v. Policy Mgmt. Sys. Corp., 119 S. Ct. 1597, 1603 (1999).

Based on the factual allegations, it does not appear to the undersigned that Plaintiffs who

are or were employed have attempted to assert a claim under Title I of the ADA, and, thus, there

would be no claims to dismiss. Plaintiffs’ Petition does not include language from Title I, and

Plaintiffs neither assert that they are “qualified individuals” under the ADA, nor that they were

discriminated against or denied a reasonable accommodation.

To the extent that Plaintiffs attempt to assert Title I claims, however, the undersigned

agrees with Defendants that there is no evidence to suggest that they exhausted their

administrative remedies with the EEOC, a prerequisite to suit. Thus, it is recommended that the

Court grant Defendants’ motion to dismiss Plaintiffs’ Title I ADA claims, if any, with prejudice.

In contrast to any alleged Title I claims, Plaintiffs’ Petition does include language

mirroring that of Title III, indicating that they intended to assert this type of ADA claim. [doc.

#1-1].

Title III of the ADA provides that “[n]o individual shall be discriminated against on the

basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges,

advantages, or accommodations of any place of public accommodation by any person who owns,

leases (or leases to), or operates a place of public accommodation.” 42 U.S.C. § 12182(a).

To state a prima facie claim under Title III of the ADA, a plaintiff must show: (1)

that she is “disabled” as defined by the ADA; (2) that the defendant is a private

entity that owns, leases, or operates a place of public accommodation; and (3) that

the defendant discriminated against the plaintiff because of the plaintiff's

disability. 42 U.S.C. § 12182(a).

Kramer v. Lakehills S., LP, No. A-13-CA-591, 2014 WL 51153, at *6 (W.D. Tex. Jan. 7, 2014).

While it is undisputed that “[t]he ADA require[s] employees to exhaust their

administrative remedies before seeking judicial relief” for claims under Title I, [doc. #6] (citing

McClain v. Lufkin Indus., 519 F.3d 264, 273 (5th Cir. 2008), it is not settled whether plaintiffs

are required to exhaust administrative remedies before seeking judicial relief under Title III.

Wyatt v. Liljenquist. 96 F.Supp.2d 1062, 1064 (C.D. Cal. 2000).

Courts’ disagreement on whether Title III claims require exhaustion stems from 42

U.S.C. § 12188, which states that the remedies and procedures of Title VII of the Civil Rights

Act, specifically 42 U.S.C. § 2000a-3(a), also apply to claims under Title III of the ADA. 42

U.S.C. § 12188. Section 2000a-3(a) itself is limited to providing claimants with the right to seek

injunctive relief. 42 U.S.C. § 2000a-3(a). However, 42 U.S.C. § 2000a-3(c) requires claimants

to give notice to the appropriate state or local authority before seeking judicial relief. 42 U.S.C. §

2000a-3(c). Essentially, courts disagree as to whether 42 U.S.C. § 12188 incorporates only

Section 2000a-3(a), or Section 2000a-3(c) as well. Under one line of cases, courts have found

that, because Section 2000a-3(a) is limited by the notice requirement in Section 2000a-3(c), both

sections apply to claimants seeking relief under Title III of the ADA and thus, claimants bringing

Title III claims must comply with the notice requirement. Howard v. Cherry Hills Cutters, Inc.,

935 F.Supp. 1148, 1149-50 (D. Colo. 1997); Daigle v. Friendly Ice Cream Corp., 957 F.Supp. 8,

10 (D. N.H 1997). Under a second line of cases, other courts have found that because the ADA

incorporates only Section 2000a-3(a), not Section 2000a-3(c), and, thus, administrative

exhaustion is not required for Title III claims. See, e.g, Soignier v. Am. Bd. of Plastic Surgery,

No. 95 C 2736, 1996 WL 6553, at *1 (N.D. Ill. Jan. 8, 1996), aff’d 92 F.3d 547 (7th Cir. 1997),

cert. denied, 519 U.S. 1093 (1997); McInerney v. Rensselaer Polytechnic Inst., 505 F.3d 135,

139 (2d Cir. 2007).

Although it does not appear that the Fifth Circuit has decided the issue, the district courts

in the Fifth Circuit which have addressed this issue have followed the second line of cases. See

Kirk v. Rental Assoc., P.A., No. 07-CA-009, 2007 WL 2048833, at *5 (W.D. Tex. July 16, 2007)

(“Unlike Title I of the ADA, Title III of the ADA does not require exhaustion of state or federal

administrative remedies.”); Meriweather v. ABC Training/Safety Council Tex. Gulf Coast

Chapter, No. 15-cv-862, 2016 WL 8711726, at *3 (N.D. Tex. Oct. 24, 2016) (“Unlike Title I,

neither Title II nor Title III of the ADA requires that a plaintiff file an administrative complaint

with the EEOC or otherwise exhaust state or federal administrative remedies before filing a

lawsuit.”). Although the analyses in Kirk and Meriweather were not robust, both cases relied on

an in-depth statutory analysis conducted in Wyatt v. Liljenquist, 96 F.Supp.2d at 1062. In that

case, a California district court looked to the plain meaning of 42 U.S.C. § 12188 and determined

that “[b]y its express terms, the ADA adopts only Section 2000a-3(a), which says nothing about

notice or exhaustion remedies. Furthermore, Section 2000a-3(a) makes no reference to

subsection (c)” and therefore, “[t]he unambiguous language of Section 12188(a)(1) defeats” the

argument that the ADA incorporates a notice requirement. Id. at 1064. The undersigned agrees

and does not recommend dismissal on employee-Plaintiffs’ Title III ADA claims on the basis of

lack of notice.

Defendants further argue, however, that they are entitled to dismissal of Plaintiffs’ Title

III claims for damages because that Title provides for injunctive relief, not damages. [doc. #6-

1]. The undersigned agrees. See 42 U.S.C. § 12188 (“The remedies and procedures set forth in

section 2000a–3(a) of [Title 42 U.S.C.] are the remedies and procedures [Title III] provides to

any person who is being subjected to discrimination . . .”); see also Plumley v. Landmark

Chevrolet, Inc., 122 F.3d 308, 312 (5th Cir. 1997) (“Damages are not available for a Title III

ADA claim brought by a private party, but a private party may seek injunctive relief.”). To the

extent that Plaintiffs seek damages under Title III of the ADA, it is recommended that

Defendants’ motion to dismiss be granted and these claims be dismissed with prejudice.

Additionally, the undersigned finds, sua sponte, that Plaintiffs have otherwise failed to

state a claim as a matter of law.3 Plaintiffs have failed to allege that they have disabilities, as

defined by the ADA. “The threshold requirement in any case brought under the ADA is showing

that the plaintiff suffers from a disability protected under the Act;” therefore, this element is

crucial to a Title III cause of action. Eber v. Harris Cnty Hosp. Dist., 130 F.Supp.2d 847, 856

(S.D. Tex. 2001). Without even attempting to address this minimal requirement, Plaintiffs have

failed to allege facts sufficient to survive a motion to dismiss. Thus, the undersigned

recommends that Plaintiffs’ Title III ADA claims be dismissed with prejudice on this basis as

well.4

3 To the extent that the undersigned has expanded upon the grounds for dismissal urged by

movants, the instant report and recommendation provides adequate notice to the parties. McCoy

v. Wade, No. 06-cv-2292, 2007 WL 1098738, *1 (W.D. La. Mar. 12, 2007) (explaining that the

report and recommendation itself provided adequate notice to the parties). In any event, the

Court possesses the inherent authority to dismiss a party sua sponte. McCullough v. Lynaugh,

835 F.2d 1126, 1127 (5th Cir. 1988). Moreover, to the extent that either party wishes to object to

the undersigned’s sua sponte dismissal, it can do so pursuant to 28 U.S.C. § 636(b)(1)(C) and

Federal Rule of Civil Procedure 72(b), as outlined in the second to last paragraph of this report

and recommendation.

4 While under Federal Rule of Civil Procedure 15, the undersigned has considered whether leave

should be given to Plaintiffs to amend their Petition to properly assert Title III claims,

amendment appears futile. As Defendants point out, the purpose of Title III is to provide

injunctive relief to resolve issues regarding public accommodations, whereas Plaintiffs in this

case seek only damages. Moreover, there is no indication that the employee-Plaintiffs or Dixon

suffered from a disability of any type protected under the ADA.

B. Plaintiffs’ Claims Under CMS Regulations

Defendants move for dismissal of Plaintiffs’ claims under CMS regulations. Plaintiffs

also failed to oppose Defendants’ arguments on these claims.

While Plaintiffs cite several times in their Petition to Defendants’ violations of CMS

guidelines or protocols relating to Covid-19, [doc. #1-1], it is unclear whether they are

attempting to assert a cause of action under the CMS regulations or merely using the alleged

violations of CMS guidelines as evidence of Defendants’ gross negligence. Unlike their

references to the ADA, Plaintiffs do not cite language from CMS guidelines or make clear which

protocols Defendants allegedly failed to implement. Rather, Plaintiffs’ references to CMS

violations are vague and generally circle back to Plaintiffs’ claims for negligence. For example,

Plaintiffs state that Defendants failed to comply with guidelines from the CMS and “[a]s a result,

[sic] of defendant’s negligence and/or gross negligence as set forth herein and hereinabove, the

Defendant’s facility became rampant with the coronavirus which spread to the staff and

residents.” [doc. #1-1, p.9]. A fair reading of the Complaint suggests that Plaintiffs do not

allege a cause of action based on violations of CMS regulations, but, rather, use those alleged

violations as evidence of Defendants’ negligence.

Out of an abundance of caution, however, the undersigned recommends that the Court

dismiss Plaintiffs’ claims, if any, under the CMS regulations. As Defendants properly point out,

there is no private right of action for violations of CMS regulations. See, e.g, Steward v. Abbott,

189 F. Supp. 3d 620, 639, n. 14 (W.D. Tex. 2016) (collecting cases); see also Drain v. Doctor's

Hospice of Ga., Inc., No. 18-CV-2947-SCJ, 2018 WL 9868572, at *2 (N.D. Ga. July 6, 2018

(“Congress did not create a remedy for private individuals to enforce the conditions of

participation in the regulations at issue—that responsibility falls to CMS.”). Accordingly, it is

recommended that the Court grant Defendants’ motion to dismiss and dismiss with prejudice

Plaintiffs’ claims, if any, under the CMS regulations.

C. Plaintiffs’ Claim for Negligence and/or Gross Negligence

If Plaintiffs’ claims under the ADA and CMS regulations are dismissed, only Plaintiffs’

state law claims of negligence and gross negligence will remain. Defendants posit that these

claims are expressly preempted by federal law and, thus, confer onto this Court subject- matter

jurisdiction under 28 U.S.C. § 1331. [doc. #1].

Express or complete preemption exists when “the pre-emptive force of a statute is so

‘extraordinary’ that it ‘converts an ordinary state common-law complaint into one stating a

federal claim for purposes of the well-pleaded complaint rule.’” Caterpillar Inc. v. Williams,

482 U.S. 386 (1987) (quoting Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 65 (1987)). As a

result, state law claims which are completely preempted effectively become federal claims and

thus, allow federal courts to exercise subject matter jurisdiction. A finding of complete

preemption requires a defendant claiming preemption to show that

(1) the statute contains a civil enforcement provision that creates a cause of action that both

replaces and protects the analogous area of state law; (2) there is a specific jurisdictional

grant to the federal courts for enforcement of the right; and (3) there is clear Congressional

intent that claims brought under the federal law be removable.

Johnson v. Baylor Univ., 214 F.3d 630, 632 (5th Cir. 2000). This is a stringent standard which

few federal statutes have been able to meet.5 Aaron v. Nat’l Union Fire Ins. Co. of Pittsburg,

Pa., 876 F.2d 1157, 1161 (5th Cir. 1989).

5 In fact, the Supreme Court has recognized only three statutes which completely preempt state

law: The Labor Management Relations Act, ERISA, and the National Bank Act. Additionally,

“[t]he Fifth Circuit has found that the Carmack Amendment and Interstate Commerce

Defendants insist that Plaintiffs’ state law negligence claims are preempted by the PREP

Act; however, the majority of courts to decide the issue have found exactly the opposite. See

Dupervil v. All. Health Operations, LLC, 516 F.Supp.3d 238, 255 (E.D. N.Y. 2021). Although

no federal appellate court has decided the issue, “[n]early every district court to consider this

issue,” including several within the Fifth Circuit, “has concluded the PREP Act is not a complete

preemption statute.” Est. of Cowan v. LP Columbia KY, LLC, No. 20-00118, 2021 WL 1225965

(W.D. KY Mar. 31, 2021); see also Schuster v. Percheron Healthcare, Inc., 493 F.Supp.3d 533

(N.D. Tex. 2021); Brannon v. J. Ori, LLC, No. 21-cv-00058, 2021 WL 2339196 (E.D. Tex.

2021); Russell v. Irving Place Assocs., Docket No. 5:20-cv-805 (W.D. La., Monroe Division,

Aug. 5, 2021); Jones, 2021 WL 3416993. Specifically, courts have found that the PREP Act

fails the stringent test the Fifth Circuit requires the statute to meet to be considered a complete

preemption statute. The undersigned agrees.

First, to qualify as a complete preemption statute, the PREP Act must contain a civil

enforcement provision which both replaces and protects the analogous area of law. Johnson, 214

F.3d at 632. Many courts have decided, and this Court agrees, that it does not. “[T]he PREP Act

is, at its core, an immunity statute; it does not create rights, duties, or obligations.” Dupervil,

516 F.Supp.3d at 251. Rather, when the PREP Act applies, it provides tortfeasors immunity for

injuries “caused by, arising out of, relating to, or resulting from the administration of a covered

countermeasure . . .” 42 U.S.C. § 247d-6d(a). Instead of filing suit against the tortfeasor, injured

persons are limited to seeking recovery from the “Covered Countermeasure Process Fund,” a

compensation fund administered by the Secretary. Id. A claimant may file suit in the United

Commission Termination Act completely preempt certain claims related to interstate shipping.”

Russell v. Irving Place Assocs., No. 20-cv-805 (W.D. La. Aug. 5, 2021).

States District Court for the District of Columbia; however, “only when the case involves death

or serious physical injury proximately caused by willful misconduct of a covered person, and

then only after the claimant has exhausted administrative avenues and declined to accept

compensation from the” compensation fund. Russell, No. 20-cv-805, at *11. The PREP Act is

not analogous to a state law tort suit. Except for claims of willful misconduct, plaintiffs are

barred from bringing their suit or recovering in district courts. Moreover, even for the very

limited exception regarding willful misconduct claims, plaintiffs must exhaust administrative

remedies, and may instead choose recovery under the compensation fund. Thus, the PREP Act

fails to meet this requirement for complete preemption.

Second, to be considered a complete preemption statute, the PREP Act must specifically

grant jurisdiction to federal courts to enforce a right. Johnson, 214 F.3d at 632. However, the

PREP Act does not provide that claims resulting from the administration of covered

countermeasures must be brought in federal courts. Instead, it confers jurisdiction to the

Secretary who has sole discretion of the compensation fund. The only claims which the PREP

Act confers jurisdiction onto federal courts to hear are those involving willful misconduct.

However, as discussed supra, those claims must first be administratively exhausted, and the

claimant may instead choose to be compensated from the compensation fund. Moreover, only

one federal district court has jurisdiction to hear these claims, and it must be heard in front of a

panel of three judges. Therefore, except for an incredibly limited situation, suits brought

pursuant to the PREP Act cannot be brought in federal court. Thus, the PREP Act does not meet

the second requirement for complete preemption.

Finally, to satisfy complete preemption, there must be evidence that Congress clearly

intended claims brought under the PREP Act to be removable. Johnson, 214 F.3d 632. To show

this intent, Defendants seem to point to the Secretary’s Fourth Advisory Opinion which stated

that his Declarations ‘“must’ be construed in accordance with subsequent Advisory Opinions,”

which renders them “as no longer ‘advisory,’ but as having the same authority as the Declaration

itself which, in turn, is granted the force of law.” [doc. #7-1]. On January 8, 2021, the Secretary

issued an advisory opinion which claimed that the PREP Act “is a ‘complete preemption’

statute” because it establishes “a federal cause of action, administrative or judicial, as the only

viable claim.” Advisory Op. 21-01. However, this opinion does not mold the PREP Act into a

complete preemption statute. In the advisory opinion itself, the Secretary cautions that “[i]t is

not a final agency action or final order. It does not have the force or effect of law.” Id.

Therefore, “even assuming arguendo that Congress intended to delegate authority to the

Secretary . . . ‘generally to make rules carrying the force of law,’ the Office of the General

Counsel interpretation relied upon by Defendant here explicitly was not ‘promulgated in the

exercise of that authority.’” Jones, 2021 WL 3416993, at *3. Therefore, this element, like the

previous two, fails. Without this required showing of Congressional intent, the PREP Act cannot

meet the final requirement for complete preemption.

In support for their claim that the PREP Act completely preempts state claims for

negligence relating to nursing homes’ failure to prevent the spread of Covid-19, Defendants

point to a recent opinion from this Court. [doc. #1]. In Rachal v. Natchitoches Nursing &

Rehabilitation Ctr., LLC, the Court found that the PREP Act expressly preempts state law by

comparing it to the Air Transportation Safety and System Stabilization Act (the “ATSSSA”), a

recovery statute passed after the September 11, 2001 terrorist attacks which the Second Circuit

held expressly preempted state law claims. Docket No. 1:21-cv-00334 (W.D. La., Alexandria

Division, Apr. 30, 2021). The purpose of the ATSSSA was to provide relief to the victims of the

attacks, and in order to do so, created a Victim’s Compensation Fund under which those injured

by the attacks could recover. 49 U.S.C. § 40101. In re WTC Disaster Site, 414 F.3d 352, 357

(2d Cir. 2005). In Rachal, this Court found that the PREP Act, which also established relief

through a compensation fund, was analogous to the ATSSSA and therefore, is also a complete

preemptive statute. No. 1:21-cv-00334, at *n. 3.

However, there is a crucial distinction between the ATSSSA and the PREP Act, namely

that in addition to a compensation fund, the ATSSSA created an exclusive federal cause of action

for claims arising out of the terrorist attacks. See Pub.L. No. 108(b), 115 Stat. 230 (2001)

(“There shall exist a federal cause of action for damages arising out of the hijacking and

subsequent crashes of American Airlines flights 11 and 77, and United Airlines flights 93 and

175, on September 11, 2001 . . . . [T]his cause of action shall be the exclusive remedy for

damages arising out of the hijacking and subsequent crashes of such flights.”). In determining

that the ATSSSA preempted state claims arising out of the terrorist attacks, the Second Circuit

concluded that “it was [the] exclusive federal remedy . . . that gave the statute its extraordinary

preemptive force, such that any claim within its scope was really a federal-law claim.” Lopez v.

Advanced HCS, LLC, No. 21-cv-00470, 2021 WL 1259302, at *4 (N.D. Tex., Apr. 5, 2021). The

PREP Act, on the other hand, creates no such federal cause of action other than those actions for

willful misconduct, “and even those claims require administrative exhaustion before they may be

filed in federal court.” Bolton v. Gallatin Ctr. for Rehabilitation & Healing, LLC, No. 20-cv-

00683, 2021 WL 1561306, at *7 (M.D. Tenn. Apr. 21, 2021). The majority of the courts that

have decided the issue have found that this distinction is pivotal to the comparison between the

PREP Act and the ATSSSA and precludes the statutes from being considered analogous. See

Id.; Russell, No. 1:20-cv-805, at *15; Jones, 2021 WL 3416993, at *5; Schuster, 493 F.Supp.3d

at 539; Bolton, 2021 WL 1561306, at *7. The undersigned agrees and recommends that the

Court join the majority of other courts that have found that this difference requires the

conclusion that the PREP Act is not completely preempted by federal law.

D. Supplemental Jurisdiction

Having found that Plaintiffs’ state law claims are not expressly preempted by federal law,

the Court’s only basis for subject matter jurisdiction over the claims remaining in this lawsuit is

under supplemental jurisdiction, 28 U.S.C. § 1367(c). Section 1367(c) provides federal district

courts the discretion to exercise or decline supplemental jurisdiction after dismissing all claims

over which the court has original jurisdiction. See Carlsbad Tech., Inc. v. HIF Bio, Inc., 556

U.S. 635, 639 (2009). The Fifth Circuit has said that when all federal claims in a case have been

disposed of before trial, the district court should use its discretion to decline to exercise

supplemental jurisdiction over the remaining state law claims. Brim v ExxonMobil Pipeline Co.,

213 Fed.App’x 303, 305 (5th Cir. 2007). The Court explained that this is because in “case[s] in

which all federal-law claims are eliminated before trial, the balance of factors to be considered

under the pendent jurisdiction doctrine – judicial economy, convenience, fairness, and comity –

will point toward declining to exercise jurisdiction over the remaining state-law claims.” Parker

& Parsley Petroleum Co. v. Dresser Indus., 972 F.2d 580, 586-87 (5th Cir. 1992) (quoting

Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, n. 7 (1988)) (quotations omitted).

Here, weighing these factors clearly indicates that the Court should decline to exercise

supplemental jurisdiction. First, judicial economy would be best served by declining to exercise

jurisdiction because this case is still in the very early stages of litigation. Defendants removed

on May 22, 2021 – less than five months from the date of this report and recommendation. [doc.

#1]. No discovery has been performed, nor have any motions, other than the instant motion to

dismiss, been adjudicated. Second, it is convenient to remand this suit because the parties will

not have to perform a significant amount of redundant or burdensome work after the case is

transferred back to state court. Even if Defendants are required to file in state court an additional

motion to dismiss or the equivalent of one, Defendants’ position on why the Court should

dismiss Plaintiffs’ negligence claims will likely remain the same. Therefore, while filing the

same argument in a different court may present some inconvenience to Defendants, any

inconvenience will be negligible at best. Third, federalism and comity weigh in favor of

declining jurisdiction. The issues remaining in this case involve questions of substantive

Louisiana law, and, although negligence by itself is not particularly novel or complex, nursing

homes’ negligence as it relates to failed implementation of Covid-19 protocols is relatively new.

Accordingly, this issue, which based in state law negligence, should be decided by Louisiana

state courts. Finally, remanding this case is not unfair to either party. The parties will not be

required to repeat the discovery process, and as the Court already mentioned, any state court

motion to dismiss that Defendants may file will likely be on the same basis as this motion.

Therefore, this factor weighs in favor of declining to exercise supplemental jurisdiction.

Accordingly, for the reasons set forth above, IT IS RECOMMENDED that Defendants’

motion to dismiss be GRANTED IN PART and DENIED IN PART,6 Plaintiffs’ ADA and

CMS claims be DISMISSED, and Plaintiffs’ remaining state law claims for negligence and/or

gross negligence be REMANDED to the 4th Judicial District Court of Ouachita Parish,

Louisiana.

6 The undersigned does not reach Defendants’ remaining arguments in their motion to dismiss,

and they will be free to raise those arguments to the state court (or to re-urge them in this form if

the district judge declines to adopt the recommendation of remand).

Under the provisions of 28 U.S.C. § 636(b)(1)(C) and Rule 72(b) of the Federal Rules of

Civil Procedure, the parties have fourteen (14) days from service of this Report and

Recommendation to file specific, written objections with the Clerk of Court. A party may

respond to another party’s objections within fourteen (14) days after being served with a copy

thereof. A courtesy copy of any objection or response for extension of time shall be furnished to

the District Judge at the time of filing. Timely objections will be considered by the District

Judge before he makes a final ruling.

A PARTY’S FAILURE TO FILE WRITTEN OBJECTIONS TO THE PROPOSED

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS CONTAINED IN THIS

REPORT WITHIN FOURTEEN (14) DAYS FROM THE DATE OF ITS SERVICE

SHALL BAR AN AGGRIEVED PARTY, EXCEPT ON GROUNDS OF PLAIN ERROR,

FROM ATTACKING ON APPEAL THE UNOBJECTED-TO PROPOSED FACTUAL

FINDINGS AND LEGAL CONCLUSIONS ACCEPTED BY THE DISTRICT JUDGE.

THUS DONE in Chambers on this 5th day of October 2021.

i el

KAVLACDYE MCCLUSKY

UNITED STATES MAGISTRATE JUDGE

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