Florida Marine Transporters, Inc. v. Trinity Marine Prod.

Full title: FLORIDA MARINE TRANSPORTERS, INC., ET AL v. TRINITY MARINE PRODUCTS, INC.…

Court: United States District Court, E.D. Louisiana, New Orleans

Date published: Oct 2, 2002

CIVIL ACTION No. 02-1902, SECTION: I/5 (E.D. La. Oct. 2, 2002)

Opinion

CIVIL ACTION No. 02-1902, SECTION: I/5

October 2, 2002

MINUTE ENTRY

LANCE M. AFRICK, United States District Judge

This matter is before the Court pursuant to the motion to remand filed by plaintiffs, Florida Marine Transporters, Inc. and JAR Assets, Inc., which contends that this Court lacks subject matter jurisdiction. Having carefully considered the motion, the supporting and opposing briefs, and the applicable law, the Court finds that the motion to remand should be GRANTED.

FACTUAL BACKGROUND

On May 15, 2002, plaintiffs, Florida Marine Transporters, Inc. and JAR Assets, Inc., filed a petition for damages in the 22^nd Judicial District Court, Parish of St. Tammany, State of Louisiana, against defendants, Trinity Marine Products, Inc., Trinity Industries, Inc. (collectively referred to as "Trinity"), Jotun Paints, Inc., Jotun, Inc. (collectively referred to as "Jotun"), Lee Engineering Supply Company, Inc. ("Lee Engineering"), and their insurers, for damages allegedly arising out of the defective construction of plaintiffs' barges.¹ Plaintiffs' petition alleges claims for negligence, intentional misrepresentation, redhibition, recission, breach of contract, breach of implied and/or express warranty, and strict liability pursuant to the Louisiana Products Liability Act, La. R.S. 9:2800.51 et seq.²

1 More specifically, the complaint alleges that plaintiffs contracted with the defendants for the construction of eighteen (18) barges. Significant to this lawsuit, plaintiffs allege that the contract documents specified that the stem void compartments would be coated with Duro-Seal, a wax base, anti-corrosion compound, which was developed for Trinity Marine by Jotun and specifically recommended by the defendants for its use on the barges. R. Doc. No. 1, Complaint, ¶¶ IV, IX, X, XI, XII. According to the plaintiffs, defendants failed to ensure the proper application and curing of the Duro-Seal coating prior to the launching of the barges, causing various adhesion problems to occur in certain areas of the interior void compartments. Id. at ¶¶ XIV, XV, XXI, XXVIII. As a result of these adhesion problems, plaintiffs allege that the barges sustained significant corrosion pitting, as well as other damages, which have rendered the barges inoperable and/or unsuitable for their intended service. Id. at ¶¶ XXXIII-XXXV, XL, LVII, LVIII.

2 R. Doc. No. 1, Petition for Damages, ¶¶ L-LIII, LV-LVII, LIX-LXIII, LXV, LXIX.

On June 21, 2002, Trinity and Lee Engineering removed the present matter to this Court, asserting that plaintiffs' complaint raises a federal question pursuant to 28 U.S.C. § 1331.³ Specifically, defendants base their removal on paragraph LIX of plaintiff's petition which alleges in pertinent part:

3 R. Doc. No. 1, Notice of Removal, p. 2, ¶ 6. On June 24, 2002, Jotun, joined in the notice of removal. R. Doc. No. 3.

The Defendants, and each of them, warranted that the vessels would be designed and built in a good and proficient manner in accordance with the standards and practices prevailing in the industry, including in accordance with the 1997 American Bureau of Shipping "Rules for Building and Classing Steel Vessels for Service on Rivers and Intracoastal Waterways," and further warranted that all workmanship furnished by the Defendants, their employees and subcontractors would be free from defects and would conform to the requirements of the Contract Documents.⁴

4 R. Doc. No. 1, Petition for Damages, ¶ LIX.

Defendants note in their removal notice that the United States Coast Guard ("USCG") has "adopted the rules and regulations of the American Bureau of Shipping ("ABS") for the design and construction of vessels, including plaintiffs' barges."⁵ In addition, defendants allege that the contract documents identified in the above paragraph LXI of plaintiffs' petition specifically incorporate the USCG regulations by requiring that the vessels "be built in accordance with rules and regulations of the . . . U.S.C.G. carriage of Subchapter "D," Grade "A" and Lower Petroleum Products and Limited Subchapter "O" Products, Dangerous Cargoes for Type II Hull on Lakes, Bays, Sounds, and Rivers."⁶ Based on these facts, defendants argue that removal is proper because "plaintiffs' right to relief necessarily depends on a substantial question of federal law, the interpretation of USCG rules and regulations."⁷ The Court disagrees.

5 R. Doc. No. 1, Notice of Removal, p. 3, ¶ 8.

6 R. Doc. No. 1, Petition for Damages, Exhibit "A," ¶ I(D).

7 R. Doc. No. 1, Notice of Removal, p. 4, ¶¶ 13-15.

LAW AND ANALYSIS

28 U.S.C. § 1441(b) allows the removal of "[a]ny civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treatises or laws of the United States." However, removal jurisdiction is to be strictly construed as its application "deprives a state court of a case properly before it and thereby implicates important federalism concerns." Frank v. Bear Stearns Co., 128 F.3d 919, 922 (5^th Cir. 1997). The burden of establishing federal jurisdiction is on the party seeking removal. Willy v. Coastal Corp., 855 F.2d 1160, 1164 (5th Cir. 1988). Additionally, any doubts about removal must be construed against removal and in favor of remanding the case back to state court. See Vasquez v. Alto Bonito Gravel Plant Corp., 56 F.3d 689, 694 (5th Cir. 1995).

In order to determine whether a case was properly removed to federal court on the basis of federal question jurisdiction, the court must examine plaintiff's complaint pursuant to the well-pleaded complaint doctrine. Rivet v. Regions Bank of Louisiana, 522 U.S. 470, 475, 118 S.Ct. 921, 925, 139 L.Ed.2d 912 (1998). "A district court's federal-question jurisdiction . . . extends over `only those cases in which a well-pleaded complaint establishes either that federal law creates the cause of action or that the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law,' in that `federal law is a necessary element of one of the well-pleaded claims.'"⁸ Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 808, 108 S.Ct. 2166, 2173-74, 100 L.Ed. 811 (1988) (quoting Franchise Tax Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 13, 27-28, 103 S.Ct. 2841, 2848, 2856, 77 L.Ed.2d 420 (1983). Pursuant to the well-pleaded complaint doctrine, "`whether a case is one arising under the Constitution or a law or treaty of the United States . . . must be determined from what necessarily appears in the plaintiff's statement of his own claim . . . unaided by anything alleged in anticipation or avoidance of defenses which it is thought the defendant may interpose.'" Franchise Tax Bd., 463 U.S. at 10, 103 S.Ct. at 2846 (quoting Taylor v. Anderson, 234 U.S. 74, 75-76, 34 S.Ct. 724, 58 L.Ed. 1218 (1914)). "A defendant may not remove a case on the basis of an anticipated or even inevitable federal defense, but instead must show that a federal right is an essential element of the plaintiff's cause of action." Powers v. Autin-Gettys-Cohen Ins. Agency, Inc., 2000 WE 1593401, *1 (E.D.La. 10/24/00) (citing Gully v. First Nat'l Bank, 299 U.S. 109, 111, 57 S.Ct. 96, 97, 81 L.Ed. 70 (1936)). Finally, it is well established that "[j]urisdiction may not be sustained on a theory that the plaintiff has not advanced." Merrell Dow Pharm, Inc. v. Thompson, 478 U.S. 804, 810 n. 6, 106 S.Ct. 3229, 3233, n. 6, 92 L.Ed.2d 650 (1986).

8 Citing Franchise Tax Bd., the Fifth Circuit in Howery v. Allstate Insurance Co., 243 F.3d 912, 917 (5^th Cir. 2001), recently explained that even when a cause of action is created by state law, the case may nevertheless arise under federal law if (1) a federal right is an essential element of the claim, (2) interpretation of the federal right is necessary to resolve the case, and (3) the question of federal law is substantial. Emphasizing the requirement that the embedded federal question be substantial and not simply tangential, the Court stated:

An expansive interpretation of the federal question statute to allow federal courts to assert jurisdiction over cases with tangential and inessential federal components would step upon the authority of state courts to decide state law and ignore the capacity of state courts to decide questions of federal law. It would allow a federal tail to wag the state dog. Franchise Tax Board recognized as much with its insistence that the federal question be substantial before a federal court takes jurisdiction over a case stating only state law claims.

Id. at 918-19 (citing Franchise Tax Board, 463 U.S. at 13, 103 S.Ct. at 2848).

The Court finds that plaintiffs' right to relief does not arise from any federally created cause of action and it does not necessarily depend on a resolution of a substantial question of federal law. To the contrary, the plaintiffs' complaint alleges purely state law causes of action, including claims for negligence, intentional misrepresentation, redhibition, recission, breach of contract, breach of implied and/or express warranty, and strict liability pursuant to the Louisiana Products Liability Act, La. R.S. 9:2800.51 et seq., arising from the alleged wrongful application of a coating compound manufactured and/or sold by the defendants. The only reference to federal law is the allegation in paragraph LIX of the complaint that defendants allegedly warranted that the vessels would be built in accordance with the standards and practices prevailing in the maritime industry, including the ABS standards, and/or the USCG rules and regulations.⁹ This, however, is not sufficient to render plaintiffs' case as one arising pursuant to federal law.

9 R. Doc. No. 1, Complaint, ¶ LXI; Exhibit A, ¶ I(D).

While the Court may find it necessary to examine ABS standards and/or USCG rules and regulations in connection with plaintiffs' claims, it is well established that "[t]he mere fact that a court necessarily must interpret federal law or federal regulations to determine the merits of a claim is insufficient to confer federal jurisdiction." J.A. Jones Constr. Co v. City of New York, 753 F. Supp. 497, 501 (S.D.N.Y. 1990) (citing Merrell Dow Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804, 813, 106 S.Ct. 3229, 3234, 92 L.Ed.2d 650 (1986)); Nelon v. Mitchell Energy Corporation, 941 F. Supp. 73, 75 (N.D.Tx. 1996); see also Gully v. First Nat'l Bank, 299 U.S. 109, 115, 57 S.Ct. 96, 99, 81 L.Ed. 70 (1936) ("Not every question of federal law emerging in a suit is proof that a federal law is the basis of the suit"). Further, as the Fifth Circuit has made clear, "a claim does not arise under the law of the United States pursuant to either sections 1331 or 1337 if the relief sought is based entirely upon a state cause of action in which regulations established by a federal statute are used merely as further evidence of the right to recover under state law." Till v. Unifirst Federal Savings and Loan Association, 653 F.2d 152, 156 n. 2 (5^th Cir. 1981) (citing Lowe v. General Motors Corp., 624 F.2d 1373, 1379-81 (5^th Cir. 1980); see also, Willy v. Coastal Corp., 855 F.2d 1160, 1168 (5^th Cir. 1988) (citing Merrell Dow Pharmaceuticals, Inc., 478 U.S. at 813, 106 S.Ct. at 3235)("`[T]he mere presence of a federal issue in a state cause of action does not automatically confer federal-question jurisdiction'").¹⁰

10 The Court further notes that even if plaintiffs' breach of contract claim may involve an interpretation of USCG rules and regulations, as claimed by the defendants, insofar as the vessel construction contracts required that the vessels be built in accordance with same, it is well established that "[t]he fact that federal law may be involved in the interpretation of a contract does not constitute a claim under the Constitution, laws or treaties of the Unites States." Farmer v. Philadelphia Electric Co., 215 F. Supp. 729, 731 (E.D.Pa. 1963); see also J.A. Jones Constr. Co., 753 F. Supp. at 501 (citing Jackson Transit Authority v. Local Division 1285, Amalgamated Transit Union, AFL-CIO-CLC, 457 U.S. 15, 29, 102 S.Ct. 2202, 2210, 72 L.Ed.2d 639 (1982)("Nor does even the mandatory incorporation of federal standards into a contract necessarily create federal jurisdiction in a contract action based on an alleged breach of those standards").

Plaintiffs have pleaded state law causes of action that make reference to federal rules and regulations. Based on the well established jurisprudence of this Circuit and others, the Court finds that such references, even if constituting an element of plaintiffs' claims, do not suffice to render this action as one arising under federal law.¹¹ The determination of plaintiffs' claims, therefore, must be left to the state court system.

11 See MSOF v. Exxon Corporation, 295 F.3d 485 (5^th Cir. 2002) (finding no federal question jurisdiction where plaintiffs' complaint against the operator of hazardous waste disposal facilities alleged negligent and strict liability torts under Louisiana law and its only reference to federal law was an allegation that the defendant's disposal facility was maintained in violation of federal regulations); Howery v. Allstate Insurance Co., 243 F.3d 912 (5^th Cir. 2001) (remanding case to the district court with instructions to dismiss the case for lack of federal question jurisdiction where plaintiff's mention of the Federal Trade Commission rules, regulations, and statutes in its complaint fell "in the middle of a list of alleged [defendant] actions that [plaintiff] alleged were `further violation[s]' of [state law]"), Mulcahey v. Columbia Organic Chemicals Co., 29 F.3d 148, 153 (4^th Cir. 1994) (holding that the plaintiffs' reference to federal environmental statutes which provide for a private, federal remedy is not enough to support federal question jurisdiction over the plaintiffs' state law negligence per se claim), Nelon v. Mitchell Energy Corp., 941 F. Supp. 73, 75 (N.D.Tx. 1996) (holding that landowners' reference to federal environmental policies and regulations in claim for injunctive relief did not support federal question jurisdiction).

Accordingly, for the above and foregoing reasons,

IT IS oRDERED that pursuant to 28 U.S.C. § 1447(c), the motion to remand of the plaintiffs, Florida Marine Transporters, Inc. and JAR Assets, Inc., is GRANTED as this Court does not have subject matter jurisdiction, and the case is REMANDED to the 22^nd Judicial District Court, Parish of St. Tammany, State of Louisiana.