What does it take to remove a product liability suit to federal court?  For Boeing, all it took was a few seconds of flying over water.  That’s what the Seventh Circuit Court of Appeals recently concluded in Lu Junhong v. Boeing Co., a case that potentially makes it easier for tort defendants to establish federal admiralty jurisdiction.

Lu Junhong arises from a July 6, 2013 incident where a Boeing 777 flying from South Korea crashed into the seawall at San Francisco International Airport upon landing, killing three and seriously injuring forty-nine.  Some of the injured passengers filed suit against Boeing in Illinois state court, alleging product liability, negligence, and willful and wanton conduct under the theory that Boeing’s defectively designed systems contributed to the crash.  Boeing removed the cases to federal court on the grounds of federal officer jurisdiction and federal admiralty jurisdiction and the Judicial Panel on Multidistrict Litigation was set to transfer the cases to the Northern District of California to join other suits arising out of the accident.  But before the Panel formally directed the transfer, the district court remanded to state court for lack of subject-matter jurisdiction.

On appeal, the Seventh Circuit first considered whether Boeing satisfied 28 U.S.C. § 1442, which allows for removal where the action is against “[t]he United States or any agency thereof or any officer (or any person acting under that officer) of the United States or of any agency thereof.”  Boeing argued that it is “acting under” a federal officer by virtue of the fact that it certifies the airworthiness of its planes in accordance with federal regulations.  Rejecting this argument, the Seventh Circuit drew analogy to lawyers certifying that their briefs comply with court rules and taxpayers certifying the completion of their tax returns.  In both cases, self-certification may reduce the workload of federal agencies, but it does not constitute “acting under” such agencies for purposes of § 1442.  After all, “[e]very regulated firm must use its own staff to learn whether it has satisfied federal regulations.”  Plaintiffs argued that the Court’s analysis should go no further, as under 28 U.S.C. § 1447(d), a district court’s order remanding a case for lack of federal jurisdiction is not reviewable, except when the removal was based on § 1442 or § 1443.  In a split from the Eighth Circuit, the Court disagreed, holding that once a case is removed pursuant to § 1442, the district court’s entire order is reviewable.

The Court then moved on to the main event, Boeing’s admiralty jurisdiction argument.  Under 28 U.S.C. § 1333, federal district courts have original jurisdiction of “[a]ny civil case of admiralty or maritime jurisdiction.”  But how does a party establish such jurisdiction?  The Court traced the modern standard back to Executive Jet Aviation, Inc. v. Cleveland which asked, “not where a wreck ended up (land or water), but whether the events leading to the accident have enough connection to maritime activity.”  The standard was further refined in Jerome B. Grubart, Inc. v. Great Lake Dredge & Dock Co., which held that “a party seeking to invoke federal admiralty jurisdiction . . . must satisfy conditions both of location and of connection with maritime activity.”  Such conditions are satisfied when “injury suffered on land was caused by a vessel on navigable water” and where “the character of the activity giving rise to the incident shows a substantial relationship to traditional maritime activity.”

By the Seventh Circuit’s estimation, the district court wrongfully gleaned from these and other cases an inevitability standard by which “admiralty jurisdiction is available only when an accident becomes inevitable while the plane is over water.”  The district court thus based its conclusion on its finding that “the tort was neither inevitable while the plane was over water nor complete when the plane was over water.”  However, a subsequent report contradicted this analysis, finding that the crash in fact was inevitable for the final ten seconds before impact, while the plane was still over the San Francisco Bay.  Further, the Seventh Circuit found fault in the district court’s apparent belief that jurisdictional facts must be proven “beyond dispute.”  Rather, countered the Court, “[j]urisdictional allegations control unless it is legally impossible for them to be true . . . [and] it is possible for Boeing to show that this accident was caused by, or became inevitable because of, events that occurred over navigable water.”

The only remaining question was whether an airplane is “a vessel on navigable water.”  The Court answered this question in the affirmative, reasoning that functionally, an airplane operates in the same manner as an ocean-going vessel (i.e., it moves passengers and freight over waters that are outside of any sovereign territory).  For the same reason, a plane bears a significant relationship to traditional maritime activity, thus satisfying the final piece of the Grubart standard.

For defendants hoping to remove their cases to federal court based on admiralty jurisdiction, Lu Junhong appears to lower the threshold.  Instead of having to show with some high level of certainty that an accident was caused by events that occurred over navigable water, according to the Seventh Circuit, a defendant must only show that such causation is possible.  Moreover, while a district court’s conclusion on whether admiralty jurisdiction exists is ordinarily unreviewable, the Seventh Circuit will review the district court’s entire order—including its conclusion on admiralty jurisdiction—if removal was in part based on § 1442 or § 1443.

Recently, we posted a link to an article we published in the National Law Journal with Yvette W. Lowney of Exponent discussing causation issues in the context of fracking litigation.  In the article, we reviewed published studies and concluded that “taken together, the available literature contains no studies that definitively link measurable adverse human health effects with specific exposures from hydraulic-fracturing operations.”  We further observed that each study is different, addresses unique issues, and has its own set of strengths and limitations.  Accordingly, we cautioned that courts should not permit any particular study to serve a “one size fits all” purpose and that plaintiffs must be required to show specific causation in their particular cases.  In short, proximate cause remains a key factor in any fracking litigation and it is imperative that courts fulfill their gatekeeping function and avoid a rush to judgment merely because of heightened media scrutiny, emotion or politics.

It is against this backdrop that we note a recent study published in the journal PLOS ONE, where scientists from Columbia University and the University of Pennsylvania reviewed hospital admittance rates from 2007 to 2011 for 18 ZIP codes in three counties in northeastern Pennsylvania.  Two of the counties have seen an increase in drilling activity during that time period and the third functioned as a “control” because it had no active natural gas wells due to its proximity to the Delaware River watershed.  The study has generated attention-grabbing headlines like “New Report Links Fracking to Increased Hospitalizations” followed by articles discussing certain findings such as individuals living closer to active wells being more likely to be hospitalized for cardiovascular disease, cancer, and neurologic illnesses.

What is often left unsaid, however, is a critical point:  the study does not prove causation, i.e., that the health problems observed were actually caused by fracking.  Indeed, the University of Pennsylvania’s press release on the study acknowledges as much, stating that “the study does not prove that hydraulic fracturing actually causes these health problems” and that “the authors caution that more study is needed to determine how specific, individual toxicants or combinations may increase hospitalization rates.”  In addition, the study itself notes that “the precise cause for the increase in inpatient prevalence rates within specific medical categories remains unknown” and that “it is impossible to associate a specific toxicant exposure to an increase in a specific disease category requiring hospitalization.”

As more studies on fracking are published, and more headlines are generated, we must remain mindful of Chief Judge Richard Posner’s famous admonition: “[t]he courtroom is not the place for scientific guesswork, even of the inspired sort. Law lags science; it does not lead it.” Rosen v. Ciba-Geigy Corp., 78 F.3d 316, 319 (7th Cir. 1996).

As my colleague aptly noted in a prior post, courts across the United States have seen an ever-growing number of food labeling class actions over the past few years.  A recent decision in the Northern District of California granting in part and denying in part a motion to dismiss concerns yet another case in this category, Guttmann v. Nissin Foods (U.S.A.) Company, Inc., No. 3:15-cv-00567.  The plaintiff, a repeat player in litigation regarding artificial trans-fat, claims that Cup Noodles products manufactured by defendant Nissin Foods (U.S.A.) Company, Inc. (“Nissin”) contained trans-fats despite misleading claims on product labels.

At issue was the fact that although all of the noodle products contained partially-hydrogenated oils (and listed those oils among the ingredients), the nutrition-facts panel on each of the product labels included the indication “Trans Fat: 0g.”  Several of the products also included icons on the front labels that described the product as containing “0g Trans Fat.”  Order at 2.  Plaintiff claimed that the “0g Trans Fat” icon on the product’s front label was misleading and violated California laws.  Nissin moved to dismiss and argued that plaintiff’s mislabeling claims were preempted by federal regulation.

As the court explained, “nutrition facts,” statements about a food product’s nutrient contents in the nutrition-facts panel, and “nutrient-content claims,” statements about a food product’s nutrient contents outside of the nutrition-facts panel, are both regulated by the U.S. Food and Drug Administration (“FDA”).  Pursuant to those regulations, if a manufacturer chooses to declare trans-fat content in the nutrition-facts panel, for a serving size that contains less than 0.5 grams of trans-fat, the content must be expressed as zero.  21 C.F.R. 101.9(c)(2)(ii).  “Express” nutrient-content claims are permitted by regulation provided they are “not false or misleading in any respect.” 21 C.F.R. 101.13(i)(3). [click to continue…]

Plaintiffs Seek to Use Statistical Sampling to Prove Liability/Damages in False Claims Act Cases

July 20, 2015

The False Claims Act is a frequent topic of discussion here at the Monitor, not least because the relator’s bar continues to introduce the FCA into new areas.  (To grasp this point, one need look no further than DOJ’s celebratory announcement late last year that it had recovered an “unprecedented” $3.1 billion from banks and other […]

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No Duty to Warn Hospital Under Learned Intermediary Doctrine

July 17, 2015

Here are the Monitor we routinely cover the learned intermediary doctrine and its application in failure to warn suits.  Just last week, the Court of Appeals of the State of Washington tackled an issue of first impression in Taylor v. Intuitive Surgical, Inc., No. 45052-6-II, 2015 WL 4093346 (Wash. Ct. App. July 7, 2015).  There […]

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