Estate of Joseph Maglioli v. Alliance HC Holdings, LLC, No. 20-2833 (3d Cir. 2021)
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The estates of New Jersey nursing home residents, who died from COVID-19, alleged that the nursing homes acted negligently in handling the COVID-19 pandemic. The nursing homes removed the case to federal court. The district court dismissed the cases for lack of subject-matter jurisdiction.
The Third Circuit affirmed rejecting three arguments for federal jurisdiction: federal-officer removal, complete preemption of state law, and the presence of a substantial federal issue. The 2005 Public Readiness and Emergency Preparedness Act (PREP Act), 42 U.S.C. 247d-6d, 247d6e, which protects certain individuals—such as pharmacies and drug manufacturers—from lawsuits during a public-health emergency, was invoked in March 2020 but does not apply because the nursing homes did not assist or help carry out the duties of a federal superior. The PREP Act creates an exclusive cause of action for willful misconduct but the estates allege only negligence, not willful misconduct; those claims do not fall within the scope of the exclusive federal cause of action and are not preempted. The PREP Act’s compensation fund is not an exclusive federal cause of action. The estates would properly plead their state-law negligence claims without mentioning the PREP Act, so the PREP Act is not “an essential element" of the state law claim.
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