Mitchell v. Advanced HCS, L.L.C.

28 F.4th 580

Troy MITCHELL, Individually and on Behalf of the Estate of Emma Mitchell, Plaintiff—Appellee,

v.ADVANCED HCS, L.L.C., doing business as Wedgewood Nursing Home; Wedgewood Rehab; Nursing GS, L.L.C.; TOM GS, L.L.C., Defendants—Appellants.

No. 21-10477

United States Court of Appeals, Fifth Circuit.

FILED March 10, 2022

Dawn Smith, Jacob Runyon, Smith Clinesmith, L.L.P., Curtis Clinesmith, Paul J. Downey, on the brief, Clinesmith Law Firm, Dallas, TX, for Plaintiff-Appellee.

Sean Higgins, Lewis, Brisbois, Bisgaard & Smith, L.L.P., Houston, TX, Nichol L. Bunn, Counsel, Lewis, Brisbois, Bisgaard & Smith, L.L.P., Dallas, TX, Lann McIntyre, Lewis Brisbois Bisgaard & Smith, L.L.P., San Diego, CA, for Defendants-Appellants.

Jeffrey S. Bucholtz, King & Spalding, L.L.P., Washington, DC, for Amici Curiae American Hospital Association, American Medical Association, Texas Medical Association, Chamber of Commerce of the United States of America.

Before Owen, Chief Judge, and Clement and Engelhardt, Circuit Judges.

Kurt D. Engelhardt, Circuit Judge:

Federal courts have limited jurisdiction. We may only adjudicate cases and controversies to which the federal "judicial Power" extends. U.S. CONST. art. III ; see Owen Equip. & Erection Co. v. Kroger , 437 U.S. 365, 372, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978) (explaining that "Acts of Congress" likewise limit the jurisdiction of federal courts). Typically, this power does not extend to state-law disputes between citizens of the same state. See 28 U.S.C. § 1331 ; 28 U.S.C. § 1332. Defendants-Appellants ask us to exercise power over such a dispute. But the trio of jurisdictional doctrines they invoke are inapplicable here, so we cannot.¹ We therefore AFFIRM the district court and REMAND with directions to further REMAND this case to state court.

I

Emma Mitchell, a resident of Wedgewood nursing home, tragically passed away in May 2020 from pneumonia, heart disease, and complications from COVID-19. Plaintiff-Appellee Troy Mitchell ("Mitchell"), son of Emma Mitchell and executor of her estate, sued Defendants-Appellants (collectively "Wedgewood") in Texas state court in December 2020. Mitchell alleged state-law causes of action for medical negligence, corporate negligence, and gross negligence. There is no dispute that both parties are citizens of Texas.

Wedgewood removed the case to federal district court. It argued that the Public Readiness and Emergency Preparedness Act ("PREP Act" or "the Act") completely preempted Mitchell's state-law claims and created federal jurisdiction, that it could remove under the federal officer removal statute, and that jurisdiction existed under the Grable doctrine. Mitchell moved to remand back to state court. The district court granted the motion, holding that the Act did not completely preempt Mitchell's state-law claims. Mitchell v. Advanced HCS, LLC , No. 4:21-CV-00155-P, 2021 WL 1247884, at *4–5 (N.D. Tex. Apr. 5, 2021). The court did not, however, address Wedgewood's alternate bases for removal. See generally id.

Because this appeal concerns jurisdiction alone, we review the district court's holding de novo. Tenth St. Residential Ass'n v. City of Dallas , 968 F.3d 492, 498 (5th Cir. 2020).

II

We first address whether the PREP Act completely preempts Mitchell's state-law negligence claims. Generally, a defendant may only remove a case to federal court if the plaintiff could have originally filed the case there. 28 USC § 1441(a). If a dispute does not satisfy diversity jurisdiction then, subject to the "well-pleaded complaint rule," a complaint must raise a federal question to be removable. Caterpillar Inc. v. Williams , 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987). That federal question must be "presented on the face" of the complaint to satisfy the rule. Id.

Complete preemption is an exception to the well-pleaded complaint rule.² It creates federal jurisdiction if Congress, by statute, "completely pre-empt[s] a particular area [such] that any civil complaint raising [the] select group of claims is necessarily federal in character." Metro. Life Ins. , 481 U.S. at 63–64, 107 S.Ct. 1542 ; see GlobeRanger Corp. v. Software AG , 691 F.3d 702, 705 (5th Cir. 2012). That happens when a federal law creates an "exclusive cause of action" and "set[s] forth procedures and remedies governing that cause of action," such that it "wholly displaces the state-law cause of action." Beneficial Nat'l Bank v. Anderson , 539 U.S. 1, 8, 123 S.Ct. 2058, 156 L.Ed.2d 1 (2003).

To establish complete preemption, Wedgewood must therefore show that: "(1) the statute contains a civil enforcement provision that creates a cause of action that both replaces and protects the analogous area of state law; (2) there is a specific jurisdictional grant to the federal courts for enforcement of the right;" and (3) there is a clear congressional intent that the federal cause of action be exclusive. Gutierrez v. Flores , 543 F.3d 248, 252 (5th Cir. 2008) (quoting Johnson v. Baylor Univ. , 214 F.3d 630, 632 (5th Cir. 2000) ). Once established, the question becomes whether Mitchell "could have brought" his state-law claims under the federal cause of action. Aetna Health Inc. v. Davila , 542 U.S. 200, 210, 124 S.Ct. 2488, 159 L.Ed.2d 312 (2004). If so, they are completely preempted.

A

Because this issue turns on the provisions of the PREP Act, we must consider those provisions.³ The Act contains a broad grant of immunity from any suit "for loss[es] caused by, arising out of, relating to, or resulting from the administration to or the use by an individual of a covered countermeasure." 42 U.S.C. § 247d-6d(a)(1). Thus, there must be a "causal relationship" between an injury and the "administration to or use by an individual of a covered countermeasure." Id. § (a)(2)(B). These protections only apply, however, if the Secretary of the Department of Health and Human Services (the "Secretary" of "HHS") makes a declaration through the Federal Register, identifies a current or impending public health emergency, identifies covered countermeasures, states that the immunity provision is in effect, and meets other statutory requirements in the declaration. Id. § (b). Courts lack jurisdiction to review any action by the Secretary in making a declaration. Id. § (b)(7). Likewise, declarations preempt state law. Id. § (b)(8).

For most who suffer an injury that falls under the immunity provision, the sole remedy is compensation from the "Covered Countermeasures Process Fund," as determined by an administrative process. 42 U.S.C. § 247d-6e(a). This is likewise an exclusive remedy. Id. § (d)(4). There is an exception for "death or serious physical injury proximately caused by willful misconduct." Id. § (d)(1). The United States District Court for the District of Columbia has exclusive jurisdiction to adjudicate these willful-misconduct claims. Id. § (e)(1). Generally, claimants must first exhaust the administrative remedies discussed above before going to court. 42 U.S.C. § 247d-6e(d)(1).

The Act defines willful misconduct as "an act or omission that is taken intentionally to achieve a wrongful purpose; knowingly without legal or factual justification; and in disregard of a known or obvious risk that is so great as to make it highly probable that the harm will outweigh the benefit." 42 U.S.C. § 247d-6d(c)(1)(A) (cleaned up). The Act also provides that the definition of willful misconduct "shall be construed as establishing a standard for liability that is more stringent than a standard of negligence in any form or recklessness." Id. § (c)(1)(B).

In sum, once the Secretary promulgates a declaration, most injuries caused by a covered person administering a covered countermeasure are subject to the sole remedy of a compensation fund. There is a narrow exception for willful-misconduct claims, which proceed under an exclusive federal cause of action in the United States District Court for the District of Columbia, but only after the claimant has exhausted administrative remedies.

B

The Act does not completely preempt Mitchell's state-law negligence claims. First, the only cause of action it creates is for willful misconduct. See 42 U.S.C. § 247d-6e(d)(1). Assuming—without deciding—that the willful-misconduct cause of action is completely preemptive, the question is whether Mitchell "could have brought" the instant claims under that cause of action. Aetna Health , 542 U.S. at 210, 124 S.Ct. 2488. He could not. The Act clearly states that its willful-misconduct cause of action creates "a standard for liability that is more stringent than a standard of negligence in any form or recklessness." 42 U.S.C. § 247d-6d(c)(1)(B) (emphasis added). Mitchell only asserts negligence causes of action. Thus, the existence of the willful-misconduct cause of action cannot completely preempt his claims. See Maglioli , 16 F.4th at 409–10 (concluding that the Act is completely preemptive as to willful-misconduct claims, but not as to state-law negligence claims).

Second, the compensation fund that the Act creates is not completely preemptive under this court's precedents. To begin, a "compensation fund is not a cause of action." Id. at 411. It may be a civil-enforcement provision, but such provisions must nevertheless "create[ ] a cause of action." Gutierrez , 543 F.3d at 252. As the Third Circuit noted, "neither the Supreme Court nor any circuit court has extended complete preemption to a statute because it created a compensation fund." Maglioli , 16 F.4th at 412. We decline to do so here.

Assuming arguendo that the compensation fund suffices as a cause of action, the Act nevertheless does not create "a specific jurisdictional grant to the federal courts for enforcement of the right." Gutierrez , 543 F.3d at 252. Instead, the Secretary oversees administration of the fund. 42 U.S.C. § 247d-6e(a–b). Worse, the statute expressly withdraws jurisdiction from any court, state or federal, concerning "any action [taken] by the...