Jones et al v. Union Pacific Railroad Company et al

Filing 19

MEMORANDUM OPINION AND ORDER granting 9 MOTION to Remand filed by Lashelle Jones, Earl L. Jones. This case is remanded to the Circuit Court of Hot Spring County. Motions Terminated 11 Motion for Extension of Time to File Response/Reply filed by National Railroad Passenger Corporation, 13 Motion to Stay filed by Lashelle Jones, Earl L. Jones. Signed by Honorable Robert T. Dawson on June 7, 2010. (dmc)

IN THE UNITED STATES DISTRICT COURT WESTERN DISTRICT OF ARKANSAS HOT SPRINGS DIVISION EARL L. JONES and LASHELLE JONES v. Case No. 6:10-CV-06022-RTD PLAINTIFFS

UNION PACIFIC RAILROAD CO., CARL S. PARKER, and WILLIAM E. HERNDON UNION PACIFIC RAILROAD CO. v. NATIONAL RAILROAD PASSENGER CORPORATION (commonly referred to as "Amtrak")

DEFENDANTS THIRD-PARTY PLAINTIFF

THIRD-PARTY DEFENDANT

MEMORANDUM OPINION AND ORDER On April 6, 2009, Plaintiffs filed a Complaint against

Defendants in the Circuit Court of Hot Spring County, Arkansas, seeking recovery of damages in an Arkansas state-law tort claim. On March 2, 2010, Union Pacific filed a Third-Party Complaint against Amtrak, seeking full contractual indemnity in the event Defendants are found liable to Plaintiffs (Doc. 6). Thereafter,

Amtrak removed the case from state court (Doc. 1), exercising its right under 28 U.S.C. § 1441, alleging that jurisdiction lies with this Court.1 Currently before the Court are the Motion to Remand (Doc. 9) by Plaintiffs Earl Jones and Lashelle Jones and the Response (Doc.
1 Amtrak's Notice of Removal (Doc. 1) cites 28 U.S.C. § 1441 generally a n d 1441(a) more specifically. 1441(a) is clearly inapplicable and 1441(c) is a l l that can be relied upon. Lewis v. Windsor Door Co., 926 F.2d 729, 732-33 ( 8 t h Cir. 1991).

16) by Third-Party Defendant Amtrak.

Third-Party Plaintiff Union For the reasons

Pacific has adopted Amtrak's Response (Doc. 18).

stated herein, Plaintiffs' Motion to Remand is GRANTED. I. Standard of Review The party seeking removal and opposing remand bears the burden of establishing federal subject matter jurisdiction. In re Bus. A

Men's Assurance Co. of Am., 992 F.2d 181, 183 (8th Cir. 1993).

defendant may remove a state-law claim to federal court when the federal court would have had original jurisdiction if the suit were originally filed there. 28 U.S.C. § 1441; 28 U.S.C. § 1331. The

removal statute should be strictly construed. Corp. v. Sheets, 313 U.S. 100, 108 (1941).

Shamrock Oil & Gas Removal based on

federal question jurisdiction is usually governed by the "wellpleaded complaint" rule. Krispin v. May Dep't Stores Co., 218 F.3d 919, 922 (8th Cir. 2000). This rule provides that federal

jurisdiction may be invoked "only when a federal question is presented complaint." (1987). on the face of the plaintiff's properly pleaded

Caterpillar, Inc. v. Williams, 482 U.S. 386, 392

All doubts about the existence of federal jurisdiction Bus. Men's Assurance Co., 992

must be resolved in favor of remand. F.2d at 183. II. Analysis

In the case before the Court, Plaintiffs contend that under the "well-pleaded complaint" rule, the federal court lacks original Page 2 of 6

subject matter jurisdiction because the complaint does not raise a federal question. Further, they contend that a third-party claim Meanwhile, Amtrak contends

cannot create federal jurisdiction.

that it is entitled to removal because 28 U.S.C. § 1349 grants federal jurisdiction over civil actions involving corporations, such as Amtrak, in which the United States is a majority

shareholder.

Amtrak further alleges that removal is proper where

the third-party claim is sufficiently "separate and independent" from the main claim. See 28 U.S.C. § 1441(c). Thus, the

resolution of Plaintiffs' Motion to Remand depends on whether a third-party defendant may properly remove where subject matter jurisdiction is created by 28 U.S.C. § 1349. The Eighth Circuit Court of Appeals has held that the removal statute does not permit removal by third-party defendants. See

Lewis v. Windsor Door Co., 926 F.2d 729, 733-34 (8th Cir. 1991). In Lewis, the United States had been impleaded as a third-party defendant under the Federal Tort Claims Act and then removed the case. Id. at 730. After the district court granted summary

judgment, the Court of Appeals vacated the judgment, holding that "the United States, as third-party defendant, was without authority to remove the case under [those] facts." Id. at 734. Similarly,

the Seventh Circuit has held that third-party defendants do not have the authority to remove "in the broad run of third-party cases," but stopped short of "adopt[ing] a universal and absolute

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rule to that effect." Cir. 1984).

Thomas v. Shelton, 740 F.2d 478, 487 (7th

The Eighth Circuit has not explicitly extended its holding in Lewis to removal based on 28 U.S.C. § 1349. However, the Seventh

Circuit, which is closely aligned with this Circuit on the subject of third-party removal, has decided that removal jurisdiction is not created where Amtrak is named as a third-party defendant. See

Adkins v. Ill. Cent. R.R. Co., 326 F.3d 828, 835-36 (7th Cir. 2003). In Adkins, the Seventh Circuit relied on the Supreme

Court's holding in Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826 (2002), that a compulsory counterclaim is not sufficient to create federal question jurisdiction. 326 F.3d at 836. party complaints, presented Adkins,

The Court of Appeals extended Holmes to thirdreasoning a that a compulsory for counterclaim than a

"arguably

stronger

case

jurisdiction

permissive counterclaim or a permissive third-party action." The Court conceded arises that out of the result same might be different case

Id. "if or

everything

the

constitutional

controversy," but ultimately the decision to retain or remand the case is at the discretion of the district court. Id.

In contrast, the Fifth Circuit has held that the removal statute allows for removal by third-party defendants where the third-party claim is sufficiently "separate and independent" from the main claim. See Carl Heck Eng'rs, Inc. v. Lafourche Parish Page 4 of 6

Policy Jury, 622 F.2d 133, 136 (5th Cir. 1980). heavily on Carl Heck. view."

Amtrak relies

However, the case represents the "minority

Johns v. United States, Nos. 96-1058 and 97-213, 1997 WL Further, it "has been the

543092, at *2 (E.D. La. Sept. 2, 1997).

subject of nearly universal criticism from other federal courts." Cross Country Bank v. McGraw, 321 F. Supp. 2d 816, 822(S.D. W.Va. 2004).2 This authority does not persuade the Court.

III. Conclusion The party seeking removal and opposing remand bears the burden of establishing federal subject matter jurisdiction. Assurance Co., 992 F.2d at 183. Bus. Men's

Any doubts about the existence of Id. The

federal jurisdiction must be resolved in favor of remand.

Eighth Circuit has clearly decided that a third-party defendant may not properly remove a case to federal court. at 733-34. Circuit, See Lewis, 926 F.2d

Amtrak, relying on the contrary position of the Fifth has failed to demonstrate sufficient grounds for

establishing federal jurisdiction. For the reasons stated herein, Plaintiffs' Motion to Remand is GRANTED and this case is remanded to the Circuit Court of Hot Spring County.

2 Indeed, the removal statute was amended to prohibit application of the C a r l Heck holding in future diversity cases. See 28 U.S.C. § 1441(c)and O f f i c i a l Commentary on 1990 Revision; see also Gracia v. Irvine, No. 4 - 9 1 - 4 4 2 - E , 1992 WL 150093, at *1 (N.D. Tex. June 10, 1992)(noting revision of t h e statute since Carl Heck).

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IT IS SO ORDERED this 7th day of June, 2010. /s/ Robert T. Dawson Honorable Robert T. Dawson United States District Judge

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