Meyer v Health Management Associates Inc. et al
ORDER on 7 Motion to Remand. Signed by Judge Robert N. Scola, Jr. on 1/20/2012. (jky)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 11-cv-62479-SCOLA
ASSOCIATES, INC. et al.,
ORDER ON MOTION TO REMAND
THIS MATTER is before the Court on the Motion for Remand and Request for Award of
Attorney’s Fees and Costs [ECF No. 7], filed by Plaintiff Paul Meyer. The Court has carefully
considered the arguments set forth in the Motion, the Response [ECF No. 16], and the Reply
[ECF No. 23], as well as the pertinent legal authorities. For the reasons that follow, the Motion
will be granted in part. This case shall be remanded to state court; however, the Court will not
award fees and costs to Meyer’s counsel.
On October 19, 2011, Plaintiff Paul Meyer filed this lawsuit in state court, alleging a
single state law cause of action for retaliatory discharge under Florida’s Whistleblower Act,
Florida Statutes section 448.102. In the Amended Complaint, filed on November 16, 2011,
Meyer alleges he was unlawfully discharged from his role as a compliance officer after he
uncovered and internally reported widespread Medicare fraud at certain hospitals operated by
Defendants Health Management Associates, Inc. and Hospital Management Services of Florida,
Inc. (collectively, “HMA”). See Am. Compl. ¶ 17 [ECF No. 1-1].
The Amended Complaint alleges that Medicare law requires hospitals to disclose all
known errors and omissions in claims for Medicare reimbursement and that failure to do so is a
violation of law, citing 42 U.S.C. § 1320a-7b(a)(3). Meyer, a retired FBI agent, became HMA’s
director of corporate compliance in January 2010. In that capacity, he visited various hospitals
for the purpose of investigating and monitoring compliance with applicable law, including the
law governing reimbursement to hospitals under Medicare. During his visits, Meyer allegedly
discovered fraudulent Medicare billing at four HMA facilities relating to the improper admission
of certain patients.
Upon discovery, he internally reported these alleged violations to his
superiors at HMA. In August 2010, however, Meyer determined that “no meaningful action”
had been taken by HMA to rectify the alleged fraudulent billing practices he had identified.
Am. Compl. ¶ 17. This prompted Meyer to send to his superiors detailed memoranda outlining
the Medicare violations at the four HMA hospitals.
In response to Meyer’s written memoranda, HMA allegedly took immediate steps to
change his job duties and to remove him from overseeing compliance at the four facilities in
Thereafter, in January 2011, HMA allegedly changed Meyer’s responsibilities
altogether, eliminating his compliance audit duties and stonewalling him from any information
on an investigation into the supposedly fraudulent activities he had discovered and reported.
Nevertheless, Meyer continued to inquire as to whether HMA had complied with its
obligations to disclose the alleged violations pursuant to applicable law. HMA did not provide
him with any substantive information in response to these inquiries, however. Concerned with
what he perceived to be HMA’s lack of appropriate action, Meyer “continually demanded to
know” whether HMA had taken action upon his disclosures and, if so, what sort of action. He
made clear that if HMA had not properly reported its violations, Meyer himself would disclose
the company’s allegedly unlawful activities and policies to the appropriate governmental
authorities. On September 6, 2011, Meyer claims he was fired in response to his ultimatum.
Removal to Federal Court
On November 18, 2011, HMA removed this lawsuit to federal court on the basis of
federal question jurisdiction under 28 U.S.C. § 1331.
The Notice of Removal [ECF No. 1]
asserts that “the Amended complaint establishes federal question jurisdiction because Plaintiff’s
Whistleblower claim, as pled, necessarily raises substantive and disputed issues of federal law,
which a federal court can entertain without disturbing any congressionally approved balance of
federal and state judicial responsibilities,” citing Grable & Sons Metal Products, Inc. v. Darue
Engineering & Manufacturing, 545 U.S. 308 (2005). See Not. Rem. ¶ 8.
HMA contends that “Grable requires that the federal issue be actually disputed and
substantial,” and that “[t]hese requirements are met here, as this case ‘implicates the complex
reimbursement schemes created by Medicare law’ and will require a determination of whether
HMA complied with its reporting obligations under Medicare.” See id. ¶ 14. According to
HMA, a substantial and disputed issue of federal law is implicated by this lawsuit because Meyer
will have to establish that HMA actually violated the Medicare laws.1 Thus, HMA argues,
federal question jurisdiction exists under the authority of Grable & Sons.
Motion to Remand
On December 2, 2011, Meyer filed the instant Motion to Remand, claiming that this
action was improperly removed to federal court. Meyer points out that he does not seek relief
under any federal statute and that no diversity jurisdiction exists here. He further asserts that this
case does not qualify for federal jurisdiction pursuant to Grable & Sons because it does not
concern a pure issue of federal law, it does not involve any federal actors, and the underlying
determination of whether any violation occurred is fact-bound and situation-specific. Therefore,
according to Meyer, the actual and disputed federal issue in this case – that is, whether HMA
violated the Medicare laws through the improper admission of certain patients and failure to
report same – is not, as Grable & Sons requires, “substantial.”
In addition, Meyer maintains that the exercise of federal jurisdiction in this matter would
upset the congressionally-approved balance of responsibilities between the state and federal
judiciaries, as it would expand federal question jurisdiction to include any and every case in
which a state law whistleblower plaintiff accused his employer of violating some aspect of
federal law. According to Meyer, this would result in a drastic and unintended expansion of the
narrow rule established in Grable & Sons.
“It is axiomatic that the jurisdiction of the federal courts is limited, with its scope defined
by the Constitution and by statute.” See B, Inc. v. Miller Brewing Co., 663 F.2d 545, 548
(5th Cir. 1981). “[B]ecause a federal court is powerless to act beyond its statutory grant of
subject matter jurisdiction, a court must zealously insure that jurisdiction exists over a case[.]”
Smith v. GTE Corp., 236 F.3d 1292, 1299 (11th Cir. 2001).
As discussed infra, Meyer will have to prove that he objected to, or threatened to
disclose, conduct amounting to an actual violation of 1aw in order to establish that he engaged in
statutorily protected activity, which is an essential element of his state law whistleblower claim.
See Paulet v. Farlie, Turner & Co., LLC, 2010 WL 2232662, at *2 (S.D. Fla. June 2, 2010).
“On a motion to remand, the removing party bears the burden of showing the existence
of federal subject matter jurisdiction.” Conn. State Dental Ass’n v. Anthem Health Plans, Inc.,
591 F.3d 1337, 1343 (11th Cir. 2009). Removal jurisdiction exists only if the federal district
court could have exercised original jurisdiction over the action. See 28 U.S.C. § 1441(a). To
meet its burden, the removing party must prove, by a preponderance of the evidence, the facts
supporting federal jurisdiction. McCormick v. Aderholt, 293 F.3d 1254, 1257 (11th Cir. 2002).
“Because removal jurisdiction raises significant federalism concerns, federal courts are
directed to construe removal statutes strictly.” Univ. of S. Ala. v. Am. Tobacco Co., 168 F.3d
405, 411 (11th Cir. 1999). “Indeed, all doubts about jurisdiction should be resolved in favor of
remand to state court.” Id. This rule exists for a reason. “Where a federal court proceeds in a
matter without first establishing that the dispute is within the province of controversies assigned
to it by the Constitution and statute, the federal tribunal poaches upon the territory of a
coordinate judicial system, and its decisions, opinions, and orders are of no effect.” Miller
Brewing, 663 F.2d at 548; see also Am. Tobacco, 168 F.3d at 411 (“A presumption in favor of
remand is necessary because if a federal court reaches the merits of a pending motion in a
removed case where subject matter jurisdiction may be lacking it deprives a state court of its
right under the Constitution to resolve controversies in its own courts.”). Accordingly, “the trial
court must be certain of its jurisdiction before embarking upon a safari in search of a judgment
on the merits.” Miller Brewing, 663 F.2d at 548-49.
The Court finds that this case does not present a federal question within the narrow rule
of Grable & Sons. Therefore, the portion of Meyer’s Motion requesting remand will be granted.
The Court does not find HMA’s attempt at removal objectively unreasonable so as to warrant an
assessment of fees and costs, however. Thus, that portion of Meyer’s Motion will be denied.
Remand Is Required Because Meyer’s Florida Whistleblower Claim Does
Not Present A Federal Question Under Grable & Sons
Federal Question Jurisdiction Under Grable & Sons
In Grable & Sons, the Supreme Court addressed the scope of federal removal jurisdiction
where the parties are not diverse and the complaint does not plead a federal cause of action.
The plaintiff had filed a quiet title action in state court, five years after the Internal Revenue
Service (“IRS”) seized and sold the plaintiff’s real property to the defendant at a tax sale. See
Grable & Sons, 545 U.S. at 311. While no federal cause of action was stated, the plaintiff
alleged the IRS had given deficient notice of seizure under federal law, 26 U.S.C. § 6335. Id.
The defendant subsequently removed the case, asserting the existence of federal question
jurisdiction because the plaintiff’s claim of title depended on the interpretation of a federal tax
statute. Id. The district court declined to remand, and the Sixth Circuit affirmed. Id. “On the
jurisdictional question, the [Sixth Circuit] panel thought it sufficed that the title claim raised an
issue of federal law that had to be resolved, and implicated a substantial federal interest
(in construing federal tax law).” Id.
The question presented to the Supreme Court was “whether want of a federal cause of
action to try claims of title to land obtained at a federal tax sale precludes removal to federal
court of a state action with nondiverse parties raising a disputed issue of federal title law.”
Id. at 310. Justice Souter, writing for a unanimous Court, held that “the national interest in
providing a federal forum for federal tax litigation is sufficiently substantial to support the
exercise of federal-question jurisdiction over the disputed issue on removal, which would not
distort any division of labor between the state and federal courts, provided or assumed by
Congress.” Id. Essential to this holding was the presence of a “substantial” disputed issue of
federal law that, if decided in federal court, would not significantly alter the balance of judicial
responsibilities between federal and state tribunals.
Thus, to determine if a state law cause of action qualifies for federal jurisdiction under
Grable & Sons, the relevant inquiry is whether “a state-law claim necessarily raise[s] a stated
federal issue, actually disputed and substantial, which a federal forum may entertain without
disturbing any congressionally approved balance of federal and state judicial responsibilities.”
See id. at 314. While, in Grable & Sons, the Court hinted that this test would be met in only the
rare state law case, just a year later it confirmed that only a “slim category” of cases would
qualify for federal jurisdiction under the rule. See Empire HealthChoice Assurance, Inc. v.
McVeigh, 547 U.S. 677, 701 (2006).
In Empire HealthChoice Assurance, Inc. v. McVeigh, the Court rejected the argument that
an insurance plan’s reimbursement claim, based on an insured’s recovery of damages in a state
court tort action, qualified for federal treatment under Grable & Sons. 547 U.S. at 699 (“[t]his
case, we are satisfied, does not fit within [that] special and small category”). The Court stressed
the importance of several factors dispositive of its finding of federal jurisdiction in Grable &
Sons – factors that were not present in the latter case:
This case is poles apart from Grable. The dispute there centered on the action of
a federal agency (IRS) and its compatibility with a federal statute, the question
qualified as “substantial,” and its resolution was both dispositive of the case and
would be controlling in numerous other cases. . . . Grable presented a nearly
“pure issue of law,” one “that could be settled once and for all and thereafter
would govern numerous tax sale cases.” In contrast, [the insurance plan’s]
reimbursement claim . . . is fact-bound and situation-specific.
See id. at 700-01 (citations omitted). Thus, key to the Court’s finding of a “substantial” federal
question in Grable & Sons was the involvement of a federal actor, the presence of a near “pure
issue of law,” the absence of context-specific factual issues surrounding the federal issue, and the
case-dispositive nature of the federal matter presented.
The Court also emphasized that the exercise of federal jurisdiction must have a
de minimis impact on the federal-state balance of judicial responsibilities. See id. at 701. In
other words, it should not result in a dramatic spike in cases tried in the federal forum.
Meyer’s State Law Whistleblower Claim
Meyer’s Amended Complaint alleges a single state law claim for unlawful retaliation
based upon his conduct in discovering, and threatening to expose, HMA’s alleged violation of
federal Medicare law. Upon consideration of the relevant factors, the Court concludes that
“[t]his case is poles apart from Grable.”
See id. at 700.
Meyer’s claim under Florida’s
Whistleblower Act does not present any “substantial” disputed issue of federal law, it does not
directly involve or implicate the actions of any federal player, it does not present a “nearly ‘pure
issue of [federal] law,’” and its resolution is quintessentially “fact-bound and situation-specific.”
See id. at 700-01.
Actually Disputed Issue of Federal Law
The Court concedes that the Amended Complaint appears to present an issue of federal
law that is “actually disputed.” See Grable & Sons, 545 U.S. at 312. Florida’s Whistleblower
Act requires the plaintiff to prove that he disclosed or threatened to disclose an actual violation
of a law, rule, or regulation by his employer. See, e.g., Paulet v. Farlie, Turner & Co., LLC,
2010 WL 2232662, at *2 (S.D. Fla. June 2, 2010) (“The FWA requires proof of an actual
violation of federal law for an employee to prevail as a whistleblower.”). Therefore, to prevail,
Meyer will have to demonstrate that he was fired because he threatened to expose HMA’s actual
violations of Medicare law relating to improper inpatient admissions. Such a showing will
require reference to federal statutes like 42 U.S.C. § 1320a-7b(a)(3), which mandates that
hospitals disclose known errors and omissions in their claims for Medicare reimbursement.
Because HMA disputes that it violated any Medicare laws, there is an “actually disputed” issue
of federal law here. See Adventure Outdoors, Inc. v. Bloomberg, 552 F.3d 1290, 1295
(11th Cir. 2008) (disputed issue of federal law where resolution of claims required determination
of whether federal law had been broken).
HMA has not, however, carried its burden to establish that this disputed issue is
“substantial.” In Grable & Sons, the Supreme Court stressed that a federal forum is available
only for “substantial questions of federal law.” See Grable & Sons, 545 U.S. at 312. To this
end, “[t]he Supreme Court has subsequently confirmed that a crucial factor supporting the result
in Grable was the presence of a ‘nearly pure issue of law.’” Adventure Outdoors, 552 F.3d at
1295. Indeed, in Grable & Sons the Court observed that “the meaning of the federal statute is
actually in dispute,” and that “it appears to be the only legal or factual issue contested in the
case.” Grable & Sons, 545 U.S. at 315. By contrast, the Court’s subsequent decision in Empire
HealthChoice involved issues that, while touching on federal law, were ultimately “fact-bound
and situation-specific.” See Empire HealthChoice, 547 U.S. at 700. Thus, “federal jurisdiction
was inappropriate in the latter case.” Adventure Outdoors, 552 F.3d at 1295.
HMA contends that substantiality is shown primarily because the Medicare laws are
complicated and resolution of this case will require the Court to address issues of first impression
in this Circuit. But Meyer’s claim does not present any case-dispositive “nearly ‘pure issue of
law’” for resolution; rather, the substantiality of the dispute appears to center upon, and be bound
up in, context-specific factual determinations going to HMA’s knowledge, the sufficiency and
timing of any Medicare disclosures, and whether its actions constituted fraud or not.
As the Eleventh Circuit noted in Adventure Outdoors, “[t]he Seventh Circuit recently
emphasized this distinction between factual and legal issues,” in Bennett v. Southwest Airlines
Co., 484 F.3d 907, 910 (7th Cir. 2007), when it found a state tort claim concerning an aviation
accident presented “a fact-specific application of rules that come from both federal and state law
rather than a context-free inquiry into the meaning of a federal law.” Adventure Outdoors, 552
F.3d at 1299; see also Singh v. Duane Morris LLP, 538 F.3d 334, 339 (5th Cir. 2008) (no federal
question jurisdiction where “federal issue [did not involve] resolution of an important question of
law,” but was “predominantly one of fact”). In finding an absence of substantiality in Adventure
Outdoors, the Eleventh Circuit stated that,
In our view, [the plaintiffs’] allegation of fraudulent inducement does not amount
to an argument about the meaning of federal law. . . . If this case were to reach
trial, resolution of the plaintiffs’ claims ultimately would require an evaluation of
this factual argument. To be sure, the jury would have to apply federal law to
reach its decision. But as the Supreme Court explained in Grable, the federal
courts have rejected the “expansive view that mere need to apply federal law in a
state-law claim will suffice to open the ‘arising under’ door.”
Adventure Outdoors, 552 F.3d at 1300 (quoting Grable & Sons, 545 U.S. at 313).
The Eleventh Circuit’s analysis fits the bill here. In this case, HMA admits that “it found
certain errors or omissions as to certain inpatient billing at the named subsidiary hospitals,”
though it denies “such billing involved any ‘fraudulent’ intent[.]” HMA’s Resp. at 5. But
whether HMA’s conduct was fraudulent is a factual question, not a legal one. See, e.g., Witt v.
La Gorce Country Club, Inc., 35 So. 3d 1033, 1040 (Fla. 3d DCA 2010); Coastal Inv. Props.,
Ltd. v. Weber Holdings, LLC, 930 So. 2d 833, 833 (Fla. 4th DCA 2006). And the same goes for
the other issues HMA identifies as disputed – issues such as when a defendant would be deemed
to have “knowledge” of errors or omissions and what would constitute sufficient timely
“disclosure” of such errors.
See HMA’s Resp. at 8.
These are all fact-bound matters; a
“substantial” disputed issue of federal law they do not make. Further, as Meyer correctly argues,
any determination of whether HMA violated the Medicare laws will inevitably involve detailed
factual consideration, perhaps even on a patient by patient basis, of whether the admissions in
question were properly done. This is not the sort of “nearly ‘pure issue of law’” over which the
Supreme Court has countenanced the exercise of federal jurisdiction.
In addition, “[t]wo other factors central to Grable’s substantiality analysis – the
importance of the government’s interest in the disputed federal tax provision and the ability of a
federal agency to vindicate its action in federal court – weigh against finding a substantial federal
question in this case.” Adventure Outdoors, 552 F.3d at 1300. This case implicates no federal
actor, such as a governmental agency. That alone serves to distinguish this matter from Grable
& Sons, where “[t]he dispute . . . centered on the action of a federal agency (IRS) and its
compatibility with a federal statute.” Empire HealthChoice, 547 U.S. at 700; see also Baptist
Hosp. of Miami, Inc. v. Wellcare of Fla., Inc., 2011 WL 2084003, at *4 (S.D. Fla. May 23, 2011)
(“the federal aspect of Medicaid law in this case does not present a substantial federal issue”
because, in part, “[t]he case is between private parties and does not implicate the actions of any
To be sure, “[t]he federal government unquestionably has a strong interest in uniformity
and consistency of federal [Medicare] law.” See Empire HealthChoice, 547 U.S. at 700. But
HMA fails to establish any “serious federal interest in claiming the advantages thought to be
inherent in a federal forum.” See Grable & Sons, 545 U.S. at 313. To the contrary, the state
courts’ handling of cases such as this one, where the interpretation of federal Medicare law is but
one part of the underlying lawsuit, will not meaningfully encroach upon the work of the federal
courts in construing the Medicare statutes. Further, such determinations by the state courts “will
not, in any event, result in any more inconsistency than that which a multimembered, multitiered federal judicial system already creates[.]” See Tafflin v. Levitt, 493 U.S. 455, 465 (1990).
“In Empire HealthChoice, the Court emphasized that the legal issue in Grable ‘was both
dispositive of the case and would be controlling in numerous other cases.’” Adventure Outdoors,
552 F.3d at 1301 (quoting Empire HealthChoice, 547 U.S. at 700). In contrast, the federal issue
here will not necessarily dispose of this case. Even if HMA is found to have violated federal
Medicare law, other issues will remain – such as whether Meyer’s termination was causally
linked to his discovery of, and his threats to disclose, HMA’s violations to higher authorities.
Moreover, the interpretation of Medicare law in this lawsuit will not be controlling in
numerous others because this case does not present “a context-free inquiry into the meaning of a
See Bennett, 484 F.3d at 910.
HMA speculates that this case will have
“controlling impact on numerous other cases” due to “the impact Medicare laws and regulations
have on health care providers (as well as beneficiaries) nationwide,” see HMA’s Resp. at 12, but
it fails to deliver any support for this claim. In any event, HMA is mistaken because the federal
courts are never bound by a state court’s interpretation of federal law; such decisions lack
precedential effect in the federal system. See Adventure Outdoors, 552 F.3d at 1301 (“the state
court interpretation of the [federal] statutes will not be controlling in numerous other cases
because it will not have precedential effect in the federal system”). Which is as it should be. To
the extent there is some difficult issue of Medicare law wrapped up in this case, it ought not be
decided, for all time, incidental to a state law retaliation claim.
Its determination, with
precedential effect, deserves to await presentation in a proper federal case where something
approaching “a context-free inquiry” can be made. See Bennett, 484 F.3d at 910.
For all of these reasons, then, the disputed issues of federal law in this case clearly are
not “substantial” within the meaning of Grable & Sons.
The authorities cited by HMA do not suggest otherwise. In the first place, the three
decisions upon which it primarily relies are not from within this Circuit. This Court is bound to
follow Grable & Sons as construed by the Eleventh Circuit in Adventure Outdoors, not some
district court decision from another jurisdiction. See Cuban Am. Bar Ass’n, Inc. v. Christopher,
43 F.3d 1412, 1424 n.9 (11th Cir. 1995) (“While other circuit and district courts may have
considered similar issues, it is the case law of this circuit which governs our decisions.”);
Miller v. Astrue, 2011 WL 1598731, at *10 (M.D. Fla. Apr. 28, 2011) (“Case law from other
circuits and district courts are not binding on this Court.”).
In any event, these decisions are distinguishable and, thus, not persuasive. This case is
worlds apart from New York City Health & Hospitals Corp. v. Wellcare of New York, Inc.,
769 F. Supp. 2d 250, 256 (S.D.N.Y. 2011), where the district court found “[t]he eventual
outcome of this litigation could potentially affect the hundreds of [managed health care
organizations] that have contracted with [the Centers for Medicare & Medicaid Services, a
division of the Department of Health and Human Services and the federal agency that
administers the Medicare Advantage program].” Here, by contrast, there is no pure issue of law
with potential far reaching ramifications beyond this case, and no federal player is involved.
The other two decisions cited by HMA, Prince v. Berg, 2011 WL 9103, at *3
(N.D. Cal. Jan. 3, 2011), and Landers v. Morgan Asset Management, Inc., 2009 WL 962689,
at *6 (W.D. Tenn. 2009), are similarly inapposite. In Prince, the district court denied remand
because, in part, federal law did provide a pertinent private right of action. In addition, the
district court found it significant that the plaintiff’s state law claims depended upon whether
there had been underlying violations of the False Claims Act, which served as the basis for a
pending, related qui tam action. This case, unlike Prince, involves an area where Congress
failed to create a private right of action, see Rzayeva v. United States, 492 F. Supp. 2d 60, 78 (D.
Conn. 2007), and Meyer’s claim is entirely independent of any pending qui tam matter.2
HMA asserts “upon information and belief” that its alleged Medicare violations may
also be the subject of a sealed qui tam proceeding or investigation, such that federal jurisdiction
would lie under Prince. HMA’s Resp. at 10-11. In support of this claim, however, HMA offers
nothing beyond speculation – which is insufficient to meets its burden on removal. Moreover, as
Meyer correctly notes, the state law claims in Prince were dependent upon whether there were
any underlying False Claims Act violations, which were also the basis for the qui tam
proceeding. Here, Meyer’s retaliatory discharge claim is not premised on a violation of the False
Claims Act, and his claim is unrelated to the federal government’s interest in recouping damages
for HMA’s alleged fraudulent billing in any such proceeding.
Landers is not controlling because, again, it involved claims for which Congress had
created federal private rights of action – claims involving the securities laws. In declining to
remand, the district court focused upon the fact that the case raised the same theory as securities
law claims pending in federal court and, thus, there would be a risk of inconsistent adjudications
if the state action were remanded. Also, the district court found the federal dispute “substantial”
in part because the outcome “could have extensive implications for the business practices of
investment management companies that invested in mortgage-backed securities,” beyond just the
parties involved in the case. Landers, 2009 WL 962689, at *9. This is not that case; there is no
worry of inconsistent adjudications here, and the outcome will not have far reaching implications
beyond the parties to this case. Further, the Court declines to follow Landers because it has been
criticized as inconsistent with Grable & Sons and Empire HealthChoice. See Elec. Workers
Pension Fund, Local 103 v. Weiss, 2010 WL 597717, at *9 (N.D. Ohio Feb. 17, 2010).
Effect on State-Federal Division of Judicial Labor
Even assuming the presence of a “stated federal issue, actually disputed and substantial,”
see Grable & Sons, 545 U.S. at 312, HMA’s request for the exercise of federal jurisdiction
flounders because it would work significant change upon the division of judicial labor in the
state and federal systems. As the Supreme Court made clear in Grable & Sons, “even when the
state action discloses a contested and substantial federal question, the exercise of federal
jurisdiction is subject to a possible veto,” because “the presence of a disputed federal issue and
the ostensible importance of a federal forum are never necessarily dispositive; there must always
be an assessment of any disruptive portent in exercising federal jurisdiction.” Id. at 313-14.
Here, that disruption would be too great. If this case were allowed into federal court, we
might as well set out the welcome mat for any and every state law employment action premised
upon a violation of some federal statute, rule, or regulation. See, e.g., Adventure Outdoors,
552 F.3d at 1302 (“[B]y authorizing the exercise of federal jurisdiction here, we would open the
doors of the federal courts in this circuit whenever a defamation defendant accuses a plaintiff of
violating federal law.”); Paulet, 2010 WL 2232662, at *5 (“The risk is substantial that allowing
this case into federal court would open the doors of the federal courts in this Circuit to a plethora
of state law employment cases that happen to involve federal issues. Any defendant in an FWA
case could remove it simply by referencing a federal issue involved.”).
This Court declines to put out the welcome mat. Grable & Sons makes plain that the
mere presence of some “federal issue” should not operate as “a password opening federal courts
to any state action embracing a point of federal law.” Grable & Sons, 545 U.S. at 314; see also
Madzimoyo v. Bank of N.Y. Mellon Trust Co., 440 F. App’x 728, 730 (11th Cir. 2011) (“[T]he
mere presence of a federal issue in a state cause of action does not automatically confer federalquestion jurisdiction, even where the interpretation of federal law may constitute an element of
the state cause of action.”) (citation omitted).
Finally, as to the division of judicial labor, the Court finds significant that other Florida
Whistleblower Act cases, premised on the violation of federal law, have been adjudicated in the
state courts of Florida.
See, e.g., Diaz v. Impex of Doral, Inc., 7 So. 3d 591, 594-95
(Fla. 3d DCA 2009) (state law whistleblower claim premised on violation of federal OSHA
regulation); McBride v. Gemini Air Cargo, Inc., 915 So. 2d 187 (Fla. 3d DCA 2005) (Florida
whistleblower claim based on federal regulatory violation reported to Federal Aviation
Administration); Underwood v. Rhone-Poulenc Rorer Pharms., Inc., 890 So. 2d 429, 430-31
(Fla. 4th DCA 2004) (state law whistleblower claim premised on violation of Federal Food,
Drug, and Cosmetics Act); Rice-Lamar v. City of Fort Lauderdale, 853 So. 2d 1125
(Fla. 4th DCA 2003) (Florida whistleblower claim based on City’s violation of various federal
and state discrimination laws). Such cases properly belong in those courts, not these.
Meyer’s Counsel Is Not Entitled To An Award Of Fees And Costs
Although remand is required, this Court will not award fees and costs to Meyer’s counsel.
The federal removal statute, 28 U.S.C. § 1447(c), provides that “[a]n order remanding the case
may require payment of just costs and any actual expenses, including attorney fees, incurred as a
result of the removal.” The Supreme Court has said that “awarding fees under § 1447(c) should
recognize the desire to deter removals sought for the purpose of prolonging litigation and
imposing costs on the opposing party, while not undermining Congress’ basic decision to afford
defendants a right to remove as a general matter, when the statutory criteria are satisfied.” See
Martin v. Franklin Capital Corp., 546 U.S. 132, 140 (2005).
Thus, there is no presumption for or against fees, and the decision to award them is left to
the Court’s sound discretion. See id. at 139. “Discretion is not whim,” however. See id.
Indeed, “[t]he fact that an award of fees under § 1447(c) is left to the district court’s discretion,
with no heavy congressional thumb on either side of the scales, does not mean that no legal
standard governs that discretion.” Id. The appropriate test is whether, in the Court’s good
judgment, “the removing party lacked an objectively reasonable basis for seeking removal.”
See id. at 141; Rae v. Perry, 392 F. App’x 753, 755 (11th Cir. 2010). “[T]he award of attorney’s
fees under § 1447(c) was not intended to be routine, and is still a matter for the district court’s
discretion on a case-by-case basis.” Casciani v. La Cruise, Inc., 1998 WL 34185289, at *5
(M.D. Fla. June 24, 1998).
Although this removal was not ultimately successful, the Court is unable to conclude that
HMA lacked an objectively reasonable basis for its attempt.
“Removal is not objectively
unreasonable simply because the removing party’s arguments lack merit and the removal is
ultimately unsuccessful.” Lewis v. Tulalip Hous. Ltd. P’ship No. 3, 2011 WL 6140881, at *4
(W.D. Wash. Dec. 9, 2011).
This case does involve some aspect of federal law and the
arguments in favor of removal jurisdiction, while not persuasive in the end, appear to have been
made in good faith, on the basis of the particular facts and circumstances at issue. See, e.g.,
Baptist Hosp. of Miami, 2011 WL 2084003, at *6 (no fee award where removal under Grable &
Sons was not objectively unreasonable); Fla. Dep’t of Fin. Servs. v. Universal Health Care Ins.,
2008 WL 268802, at *1 (N.D. Fla. Jan. 30, 2008) (same).
For the reasons explained above, it is hereby ORDERED and ADJUDGED as follows:
Plaintiff Paul Meyer’s Motion for Remand and Request for Award of Attorney’s
Fees and Costs [ECF No. 7] is hereby GRANTED IN PART. This case shall be REMANDED
to state court, however Meyer’s counsel is not entitled to an award of fees and costs.
In light of remand, all pending motions [ECF Nos. 9, 14, 26] are hereby DENIED
for want of jurisdiction.
The Clerk is directed to CLOSE this case and shall take all necessary steps to
ensure the prompt remand of this matter and the transfer of this file back to the Circuit Court for
the Seventeenth Judicial Circuit in and for Broward County, Florida.
DONE and ORDERED in chambers at Miami, Florida on January 20, 2012.
ROBERT N. SCOLA, JR.
UNITED STATES DISTRICT JUDGE
Copies to: Counsel of record