Jones et al v. Union Pacific Railroad Company et al, No. 6:2010cv06022 - Document 19 (W.D. Ark. 2010)

Court Description: 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)
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IN THE UNITED STATES DISTRICT COURT WESTERN DISTRICT OF ARKANSAS HOT SPRINGS DIVISION EARL L. JONES and LASHELLE JONES v. PLAINTIFFS Case No. 6:10-CV-06022-RTD UNION PACIFIC RAILROAD CO., CARL S. PARKER, and WILLIAM E. HERNDON DEFENDANTS UNION PACIFIC RAILROAD CO. THIRD-PARTY PLAINTIFF v. NATIONAL RAILROAD PASSENGER CORPORATION (commonly referred to as Amtrak ) 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 and 1441(a) more specifically. 1441(a) is clearly inapplicable and 1441(c) is all that can be relied upon. Lewis v. Windsor Door Co., 926 F.2d 729, 732-33 (8th Cir. 1991). 16) by Third-Party Defendant Amtrak. Third-Party Plaintiff Union Pacific has adopted Amtrak s Response (Doc. 18). For the reasons 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. Men s Assurance Co. of Am., 992 F.2d 181, 183 (8th Cir. 1993). A 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. Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108 (1941). 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 on complaint. (1987). 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 must be resolved in favor of remand. Bus. Men s Assurance Co., 992 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 cannot create federal jurisdiction. Meanwhile, Amtrak contends that it is entitled to removal because 28 U.S.C. § 1349 grants federal jurisdiction over civil actions involving corporations, such as Amtrak, shareholder. in which the United States is a majority 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 Page 3 of 6 rule to that effect. Thomas v. Shelton, 740 F.2d 478, 487 (7th Cir. 1984). 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 The Court of Appeals extended Holmes to third- complaints, arguably Adkins, presented reasoning a that stronger a case compulsory for counterclaim jurisdiction than permissive counterclaim or a permissive third-party action. The Court everything conceded arises that out the of result the same might be different constitutional case a Id. if or 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 543092, at *2 (E.D. La. Sept. 2, 1997). Further, it has been the 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 federal jurisdiction must be resolved in favor of remand. Id. The 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 Carl Heck holding in future diversity cases. See 28 U.S.C. § 1441(c)and Official Commentary on 1990 Revision; see also Gracia v. Irvine, No. 4-91-442-E, 1992 WL 150093, at *1 (N.D. Tex. June 10, 1992)(noting revision of the statute since Carl Heck). Page 5 of 6 IT IS SO ORDERED this 7th day of June, 2010. /s/ Robert T. Dawson Honorable Robert T. Dawson United States District Judge Page 6 of 6