Osterhout et al v. Air & Liquid Systems Corporation et al

Filing 179

MEMORANDUM-DECISION AND ORDER denying #128 Motion to Remand to State Court. Signed by U.S. District Judge Mae A. D'Agostino on 5/30/14. (ban)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
____________________________________________
ROBERT OSTERHOUT and
PEARL OSTERHOUT,
Plaintiffs,
vs.

5:14-CV-208
(MAD/DEP)

AIR & LIQUID SYSTEMS CORPORATION,
as successor by merger to Buffalo Pumps, Inc.;
CAMERON INTERNATIONAL;
CARRIER CORPORATION, individually and as
successor-in-interest to Bryant Heating and
Cooling Systems, Inc.;
CBS CORPORATION, formerly known as
Viacom, Inc., successor by merger to CBS Corporation,
a Pennsylvania corporation, formerly known as
Westinghouse Electric Corporation;
CRANE CO.; CRANE PUMPS & SYSTEMS, INC.;
FMC CORP., on behalf of its former
Peerless Pump and Northern business;
FOSTER WHEELER ENERGY CORPORATION;
GENERAL ELECTRIC COMPANY;
G.H. MINER CO., INC.; GOULDS PUMPS, INC.;
HOMELITE CONSUMER PRODUCTS, INC.;
IMO INDUSTRIES INC.;
INGERSOLL-RAND COMPANY;
JOHN CRANE, INC.; JOHNSON CONTROLS, INC.;
RUGGLES-KLINGLEMAN
MANUFACTURING CO., INC.;
SEARS, ROEBUCK & CO.; STIHL INCORPORATED;
SYRACUSE SUPPLY CO.; TATE ANDALE, INC.;
THE NASH ENGINEERING COMPANY;
TODD SHIPYARDS CORP.;
TRANE US, INC., individually and as
successor in interest to American Standard, Inc.;
TROY BELTING AND SUPPLY CO.;
WARREN PUMPS LLC;
WEIR VALVES & CONTROLS USA, INC., individually
and as successor in interest to Attwood & Morrill Co., Inc.,
Defendants.
____________________________________________
APPEARANCES:

OF COUNSEL:

LEVY KONIGSBERG, LLP
800 Third Avenue, 11th Floor
New York, New York 10022
Attorneys for Plaintiffs

JEROME H. BLOCK, ESQ.
KEITH W. BINDER, ESQ.

BROWN & KELLY, LLP
424 Main Street
Buffalo, New York 14202
Attorneys for DefendantCross-Defendant
Air & Liquid Systems Corporation

KENNETH A. KRAJEWSKI, ESQ.

COSTELLO SHEA & GAFFNEY, LLP
44 Wall Street, 11th Floor
New York, New York 10005-2401
Attorneys for DefendantCross-Claimant-Cross-Defendant
Cameron International

STEVEN E. GARRY, ESQ.

WILSON ELSER MOSKOWITZ,
EDELMAN & DICKER LLP
150 East 42nd Street
New York, New York 10017-5639
Attorneys for DefendantsCross-Claimants-Cross Defendants
Carrier Corporation,
G.H. Miner Co., Inc.,
Homelite Consumer Products, Inc., and
Todd Shipyards Corp.

JULIE R. EVANS, ESQ.
ERIK C. DIMARCO, ESQ.

SEDGWICK, LLP
Three Gateway Center, 12th Floor
Newark, New Jersey 07102
Attorneys for DefendantsCross-Defendants-Cross-Claimants
CBS Corporation,
Foster Wheeler Energy Corporation, and
General Electric Company

MICHAEL A. TANENBAUM, ESQ.
DENNIS V. VEGA, ESQ.
MATTHEW STRAUS, ESQ.

K & L GATES LLP
599 Lexington Avenue
New York, New York 10020-6030

ANGELA DIGIGLIO, ESQ.
ERIC R.I. COTTLE, ESQ.
NICOLE M. KOZIN, ESQ.
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Attorneys for DefendantsCross-Claimaints-Cross-Defendants
Crane Co.,
Crane Pumps & Systems, Inc., and
Ruggles-Klingeman Manufacturing Co., Inc.

KELLEY JASONS MCGOWAN
SPINNELLI HANNA & REBER, LLP
120 Wall Street, 30th Floor
New York, New York 10005
Attorneys for DefendantCross-Claimaint-Cross-Defendant
FMC Corp.

CHRISTOPHER P. HANNAN, ESQ.

GOLDBERG SEGALLA, LLP
665 Main Street, Suite 400
Buffalo, New York 14202
Attorneys for DefendantsCross-Defendants-Cross-Claimants
Goulds Pumps, Inc. and
Stihl Incorporated

SUSAN E. VAN GELDER, ESQ.
LISA MARIE ROBINSON, ESQ.
ANDREW J. SCHOLZ, ESQ.

LEADER & BERKON, LLP
630 Third Avenue
New York, New York 10017
Attorneys for DefendantsCross-Defendants-Cross-Claimants
Imo Industries Inc. and
Warren Pumps LLC

AMY ZUMSTEG, ESQ.

KENNEY SHELTON
LIPTAK NOWAK, LLP
233 Franklin Street
Buffalo, New York 14202
Attorneys for DefendantsCross-Defendants-Cross Claimants
Ingersoll-Rand Company and
Trane US, Inc.

JAMES S. NOWAK, ESQ.

BARRY, MCTIERNAN & MOORE
2 Rector Street
New York, New York 10006

WILLIAM A. COONEY, ESQ.

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Attorneys for DefendantCross-Defendant-Cross Claimant
John Crane, Inc.

HOAGLAND, LONGO, MORAN,
DUNST & DOUKAS
48 Wall Street
New York, New York 10005
Attorneys for DefendantCross-Defendant
Johnson Controls, Inc.

JASON RIEMER, ESQ.

MALABY & BRADLEY, LLC
150 Broadway, Suite 600
New York, New York 10038
Attorneys for DefendantCross-Defendant-Cross-Claimant
Sears, Roebuck & Co.

DAVID P. SCHAFFER, ESQ.

RIVKIN RADLER LLP
926 RXR Plaza
Uniondale, New York 11556-0926
Attorneys for DefendantCross-Defendant
Syracuse Supply Co.

DAVID E. RICHMAN, ESQ.

MCGIVNEY & KLUGER, PC
100 Madison Street, Suite 1640
Syracuse, New York 13202
Attorneys for DefendantsCross-Defendants-Cross-Claimants
Tate Andale, Inc.,
The Nash Engineering Company, and
Weir Valves & Controls USA, Inc.

ERIC M. GERNANT, ESQ.

AHMUTY, DEMERS &
MCMANUS
200 I.U. Willets Road
Albertson, New York 11507

FRANK A. CECERE, ESQ.

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Attorneys for DefendantCross-Claimant-Cross-Defendant
Troy Belting and Supply Co.

Mae A. D'Agostino, U.S. District Judge:
MEMORANDUM-DECISION AND ORDER
On February 27, 2014, Defendants Foster Wheeler Energy Corporation and General
Electric Company removed this action to federal court pursuant to the federal officer removal
statute, 28 U.S.C. § 1442(a)(1). See Dkt. No. 1. Plaintiffs Robert Osterhout and Pearl Osterhout
have moved to remand the action back to state court for lack of subject matter jurisdiction or, in
the alternative, for partial summary judgment on Defendants' government contractor defense. See
Dkt. No. 128. For the reasons set forth below, Plaintiffs' motion is denied.
On February 7, 2014, Plaintiffs commenced this action in New York State Supreme Court,
Onondaga County. See Dkt. No. 1-1 ("Verified Complaint"). In the Verified Complaint,
Plaintiffs allege that Mr. Osterhout was exposed to asbestos fibers and dust contained in
Defendants' products during his service with the United States Navy from 1947 to 1952 aboard
the U.S.S. Charles H. Roan. Id. As a result of this exposure, Plaintiffs allege, Mr. Osterhout
developed malignant mesothelioma in or about January 2014 and continues to suffer from this
disease. Id. Plaintiffs' claims, which are based upon a failure to warn theory, arise under state
law and diversity is lacking.
After being served with the summons and complaint, Defendants Foster Wheeler and
General Electric (collectively, "Removing Defendants") confirmed that they manufactured marine
steam generators used aboard the U.S.S. Roan, and filed a notice of removal under the federal
officer removal statute, 42 U.S.C. § 1442(a)(1). Several other Defendants joined in General
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Electric's and Foster Wheeler's removal, including Defendants CBS Corporation, see Dkt. No. 27,
and Crane Co., see Dkt. No. 33.1 However, all defendants need not join in removal, since the
federal officer defense may be invoked by a single party defendant. See Gordon v. Air & Liquid
Systems Corp., — F. Supp. 2d — , 2014 WL 31419, *1 n.1 (E.D.N.Y. Jan. 6, 2014) (citing
Bradford v. Harding, 284 F.2d 307, 309-10 (2d Cir. 1960)). In their notice of removal, the
Removing Defendants assert that they are immunized from liability by the government contractor
defense, which defense entitles them to a federal forum for adjudication of Plaintiffs' claims,
pursuant to Section 1442(a)(1).
A government contractor must satisfy a three-pronged test to properly effect removal
under Section 1442(a)(1):
First, it must show that it is a “person” within the meaning of the
statute. Second, it must establish that it was “acting under” a federal
officer, which subsumes the existence of a “causal connection”
between the charged conduct and asserted official authority.
Finally, the defendant must raise a colorable federal defense.
Veneruso v. Mt. Vernon Neighborhood Health Ctr., — Fed. Appx. — , 2014 WL 1776011, *3 (2d
Cir. May 6, 2014) (quoting In re MTBE Prods. Liab. Litig., 488 F.3d 112, 124 (2d Cir. 2007)).
Plaintiffs argue that this matter should be remanded to New York State Supreme Court
because the Removing Defendants have not raised a colorable federal defense and have not
established a causal nexus between Plaintiffs' claims and their conduct. Plaintiffs argument in
this regard is largely based upon evidentiary objections to the proof submitted by the Removing
Defendants in support of their removal petition. Should the Court deny Plaintiffs' motion to
remand, Plaintiffs argue in the alternative that they are entitled to summary judgment on

Since Plaintiffs' motion to remand is denied, the Court need not address Defendant
Crane Co.'s "independent" grounds for removal.
1

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Removing Defendants' government contractor defense. This is so, Plaintiffs contend, because the
Removing Defendants cannot dispute that the United States Navy did not prohibit its contractors
from including proposed warnings about the dangers of the products they sold to the Navy.
"Since it is undisputed that the Defendant military contractors never proposed any warnings about
the dangers of the asbestos contained in the turbines and boilers they sold to the Navy, Plaintiffs
are entitled to a partial summary judgment striking Defendants' government contractor defense."
Dkt. No. 128-1 at 26-27. Defendants Foster Wheeler Energy Corporation, General Electric
Company, and CBS Corporation oppose Plaintiffs' motion to remand or for partial summary
judgment, see Dkt. No. 142, and Defendant Crane Co. opposes the motion to remand only, see
Dkt. No. 136.
The parties have submitted extensive briefing and evidence regarding the availability of
the Removing Defendants' government contractor defense. As noted by several courts that have
addressed this issue, the Removing Defendants need not prove their defense to establish federal
subject matter jurisdiction. See Gordon, 2014 WL 31419, at *3 (noting that "[a] federal officer,
or his agent, 'need not win his case before he can have it removed'"). At this stage of the
litigation, the Removing Defendants need only convince the Court that they have a "colorable"
federal defense. See Gates v. A.O. Smith Water Products Co., No. 13-CV-1435, 2014 WL
104965, *4-5 (N.D.N.Y. Jan. 9, 2014) (discussing cases and concluding that "a colorable federal
defense is one that identifies fact[s] which, construed in the light most favorable to the defendant,
would establish a complete defense at trial"). This is because courts have broadly construed the
federal officer removal statute, since "one of the most important reasons for removal is to have
the validity of the defense of official immunity tried in a federal court." Willingham v. Morgan,
395 U.S. 402, 407 (1969); see also Ruppel v. CBS Corp., 701 F.3d 1176, 1182 (7th Cir. 2012)
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("we are concerned with who makes the ultimate determination, not what that determination will
be").
For substantially the reasons set forth in the papers served in opposition to Plaintiffs'
motion to remand, the Removing Defendants have satisfied their burden for removal jurisdiction
under Section 1442(a)(1). There is no need for this Court to discuss the parties' competing
arguments in a lengthy decision, since this issue has been addressed in several other cases in this
district. See, e.g., Gates, 2014 WL 104965; Crews v. Air & Liquid Systems Corp., No. 12-CV1678, 2014 WL 636362 (N.D.N.Y. Feb. 18, 2014). The Court finds the reasoning set forth by the
multidistrict litigation judge in In re Asbestos Products Liability Litigation to be persuasive. See
Hagen v. Benjamin Foster Co., 739 F. Supp. 2d 770 (E.D. Pa. 2010). Applying that standard
here, the Removing Defendants have "identif[ied] facts which, viewed in the light most favorable
to the defendant, would establish a complete defense at trial." Id. at 783. Accordingly, the
motion to remand is denied.
With respect to Plaintiffs' motion for partial summary judgment, the Removing
Defendants argue that it is premature and should be denied. Inexplicably, the Removing
Defendants failed to submit an affidavit in support of their argument, pursuant to Rule 56(d) of
the Federal Rules of Civil Procedure. In the absence of a Rule 56(d) affidavit, a party typically
cannot "meet the heavy burden faced by a party opposing summary judgment on the grounds that
additional discovery is required." Eastern Savings Bank, FSB v. Rabito, No. 11-cv-2501, 2012
WL 3544755, *6 (E.D.N.Y. Aug. 16, 2012) (quotation and citation omitted).
Nevertheless, the Court is entitled to exercise its discretion to assure "the just, speedy, and
inexpensive determination" of any action pending before it. See Fed. R. Civ. P. 1. The Court is
not convinced that adjudication of Plaintiffs' motion for partial summary judgment at this time
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would achieve the goals set forth in Rule 1. As an initial matter, the parties in this matter are still
actively engaged in fact discovery, which is scheduled to close on September 15, 2014, with
expert discovery to follow thereafter, and a dispositive motion deadline of March 30, 2015.
Perhaps more importantly, Plaintiffs moved for partial summary judgment only as to Defendants
Foster Wheeler and General Electric. See Dkt. No. 128. This case currently has no fewer than
thirteen defendant groups, many of which are likely to seek to interpose a government contractor
defense. As such, any determination of Plaintiffs' summary judgment motion would be
necessarily incomplete, since it would be based upon an incomplete record and would not decide
the issue as to all relevant parties. Accordingly, Plaintiffs' motion for partial summary judgment
is denied without prejudice to renew at the appropriate time.2
After carefully reviewing the entire record in this matter, the parties' submissions and the
applicable law, and for the above-stated reasons, the Court hereby
ORDERS that Plaintiffs' motion (Dkt. No. 128) is DENIED; and the Court further
ORDERS that Plaintiffs' motion to remand is DENIED; and the Court further
ORDERS that Plaintiffs' motion for partial summary judgment is DENIED without
prejudice to renew; and the Court further

The Court is compelled to address Defendant Crane Co.'s supposition that where a court
finds that a defendant is entitled to invoke jurisdiction pursuant to the federal officer removal
statute, the Court must also find that the defendant has raised a question of fact with respect to its
entitlement to interpose the government contractor defense at trial. See Dkt. No. 136 at 1 n.2.
Crane Co. has cited no support for this proposition, nor is this Court aware of any. As noted
above, although this Court has determined that a federal court is the appropriate forum in which
to adjudicate the availability of Defendants' government contractor defense, it has by no means
determined that Defendants are entitled to that defense. See Mesa v. California, 489 U.S. 121,
129 (1989) (recognizing that the jurisdictional question of a colorable defense and the substantive
question of the validity of that defense are "wholly different inquiries").
2

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ORDERS that the Clerk of the Court shall serve a copy of this Memorandum-Decision
and Order on the parties in accordance with the Local Rules.

IT IS SO ORDERED.
Dated: May 30, 2014
Albany, New York

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