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Sawyer v. Foster Wheeler LLC

United States Court of Appeals, Fourth Circuit

June 22, 2017

JANYA SAWYER, Representative of the Estate of Joseph W. Morris; GARNETTE MORRIS, Individually and as Surviving Spouse of Joseph W. Morris; NANCY PIKE, Surviving Child of Joseph W. Morris; EDWARD MORRIS, Surviving Child of Joseph W. Morris; WAYNE MORRIS, Surviving Child of Joseph W. Morris; JOANNE TRAYNOR, Surviving Child of Joseph W. Morris, Plaintiffs - Appellees,
v.
FOSTER WHEELER LLC, Defendant-Appellant, and UNION CARBIDE CORPORATION; JOHN CRANE-HOUDAILLE, INC., f/k/a Crane Packing Company; OWENS-ILLINOIS GLASS CO., f/k/a Owens-Illinois, Inc.; FOSTER WHEELER CORPORATION; HOPEMAN BROTHERS, INC.; UNIVERSAL REFRACTORIES COMPANY; SELBY, BATTERSBY & COMPANY; CBS CORPORATION, a Delaware Corporation, f/k/a Viacom, Inc., f/k/a CBS Corporation, a Pennsylvania Corp., f/k/a Westinghouse Electric Corp.; J.H. FRANCE REFRACTORIES CO.; THE GOODYEAR TIRE & RUBBER CO.; MCIC, INC., and its Remaining Director of Trustees, Robert I. McCormick, Elizabeth McCormick and Patricia Shunk; METROPOLITAN LIFE INSURANCE CO.; GENERAL ELECTRIC COMPANY; BAYER CROPSCIENCE, INC., Individually and as Successor in Interest to Benjamin Foster Co., Amchem Products, Inc., H.B. Fuller Co., Aventis CropScience USA, Inc., Rhone-Poulenc AG Company, Inc., Rhone-Poulenc, Inc., Rhodia Inc.; INTERNATIONAL PAPER COMPANY, Individually and as Successor in Interest to Champion International Corporation, U.S. Plywood Corp.; COOPER INDUSTRIES, INC., Individually and as Successors in Interest to Crouse-Hinds Co.; FERRO ENGINEERING, Division of On Marine Services Company; FOSECO, INC.; WAYNE MANUFACTURING CORPORATION; LOFTON CORPORATION, as Successor-in-Interest to Wayne Manufacturing Corporation, Hopeman Manufacturing Corporation; SCHNEIDER ELECTRIC USA, INC., f/k/a Square D Company; GREENE, TWEED & CO., Individually and as Successor in Interest to Palmetto, Inc.; WALLACE & GALE ASBESTOS SETTLEMENT TRUST, Successor to the Wallace & Gale Company; CROWN, CORK & SEAL CO., INC.; GEORGIA-PACIFIC, LLC, Ind/Successor to BestWall Gypsum Co.; KOPPERS COMPANY, INC.; PFIZER, INC.; PHELPS PACKING & RUBBER CO., Phelps Industrial; PARAMOUNT PACKING & RUBBER, INC.; LLOYD E. MITCHELL, INC.; PECORA CORPORATION, Individually and as Successor in Interest to Pecora, Inc., New Pecora Corp., Defendants,
v.
GENERAL REFRACTORIES CO.; A.W. CHESTERTON COMPANY; MANVILLE TRUST PERSONAL INJURY SETTLEMENT TRUST; SB DECKING, INC., f/k/a Selby, Battersby & Co., Inc.; UNIROYAL, INC.,

          Argued: May 10, 2017

         Appeal from the United States District Court for the District of Maryland, at Baltimore. Catherine C. Blake, Chief District Judge. (1:16-cv-00118-CCB)

         ARGUED:

          Erik David Nadolink, WHEELER TRIGG O'DONNELL, LLP, Denver, Colorado, for Appellant.

          Jeffrey John Utermohle, LAW OFFICES OF PETER G. ANGELOS, P.C., Baltimore, Maryland, for Appellees.

         ON BRIEF:

          Patrick C. Smith, John C. Ruff, DEHAY & ELLISTON, LLP, Baltimore, Maryland, for Appellant.

          William G. Minkin, Demetrios A. Karas, LAW OFFICES OF PETER G. ANGELOS, P.C., Baltimore, Maryland, for Appellees.

          Before NIEMEYER, KING, and DUNCAN, Circuit Judges.

          NIEMEYER, Circuit Judge

         In this appeal, we are presented with the single issue of whether a government contractor was entitled to remove a state tort action to federal court under 28 U.S.C. § 1442(a)(1) based on the contractor's assertion that it had a colorable federal defense of government-contractor immunity.

         Joseph Morris worked as shipbuilder at the Bethlehem Steel Sparrows Point Shipyard, beginning in 1948 and continuing into the 1970s. He died of mesothelioma in 2015. Morris' family and the personal representative of his estate commenced this action against Foster Wheeler LLC and other defendants in a Maryland state court, alleging that Morris' death was caused by exposure to asbestos while assembling boilers at the Shipyard and that the defendants failed to warn him of the dangers of asbestos, which was a component of the boilers.

         Foster Wheeler, a manufacturer of the boilers that Morris and other Shipyard employees assembled for use aboard U.S. Navy vessels, removed this action to federal court pursuant to 28 U.S.C. § 1442(a)(1), claiming that it manufactured the boilers under a contract with the Navy and therefore possessed a colorable federal defense of government-contractor immunity. The district court, however, granted the plaintiffs' motion to remand the case to state court, concluding that Foster Wheeler did not make a sufficient showing that it had a colorable federal defense and that, in any event, the conduct for which it was sued was not causally connected to official authority.

         On appeal, we conclude that the district court applied the wrong standard for determining removability under § 1442(a)(1), and, because we conclude that Foster Wheeler met the statute's requirements, we reverse. But because the court left open the question of whether Foster Wheeler's removal was timely noticed, we remand the case to the district court to make that determination in the first instance.

         I

         In June 2015, Morris' surviving spouse, his children, and the representative of his estate commenced this action against Foster Wheeler and other defendants in the Circuit Court for Baltimore City, Maryland, alleging - in claims for strict liability, breach of warranty, and negligence, among others - that the defendants had failed to warn Morris of the dangers of asbestos. They asserted that Morris was exposed to asbestos while working in the boiler shop at the Sparrows Point Shipyard from 1948 through the 1970s and that his exposure caused the mesothelioma that killed him in 2015. In response to interrogatories, the plaintiffs explained in more detail that Morris and other Shipyard employees assembled boilers containing asbestos at the Shipyard that had been manufactured offsite, including ones manufactured by Foster Wheeler.

         Foster Wheeler filed a notice of removal pursuant to 28 U.S.C. § 1446, claiming authority for removal under § 1442(a)(1), which provides for removal by federal officials and their agents in specified circumstances. In its notice, Foster Wheeler stated that, during the relevant time period, it manufactured boilers for the U.S. Navy under the Navy's strict specifications; that its boilers were sent in pieces to the Sparrows Point Shipyard for assembly; that Morris and his fellow employees assembled the boilers at the Shipyard; and that the boilers contained asbestos. It asserted, moreover, that "in the manufacture and sale of boilers and auxiliary equipment for the Navy, including all aspects of warnings associated with that equipment, [it] was acting under an officer or agency of the United States" and therefore had a colorable defense of government-contractor immunity, entitling it to remove the case to federal court to have that defense heard there.

         In support of its notice, Foster Wheeler submitted an affidavit from J. Thomas Schroppe, a former Foster Wheeler employee who, from 1962 to 1999, rose through the ranks of Foster Wheeler as an engineer and eventually became president of its subsidiary Boiler Corporation. Schroppe, who stated that he was "personally involved" in the Navy's procurement contracts for boilers "at all the various stages of development, " described "the contract process from the perspective of Foster Wheeler as the vendor, as well as the levels of interaction between Foster Wheeler and the Navy." He stated that Foster Wheeler designed boilers to match highly detailed ship specifications and military specifications provided by the Navy, and that "deviations from these specs were not acceptable." He also spoke to the "intense direction and control" that the Navy exercised "over all written documentation to be delivered with its naval boilers, " explaining:

The Navy required that every piece of equipment be supplied with a defined number of copies of one or more technical manuals. Navy personnel participated intimately in the preparation of this kind of information and exercised specific direction and control over its contents. These manuals included safety information related to the ...

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