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Strong v. Republic Services, Inc.

United States District Court, E.D. Missouri, Eastern Division

October 20, 2017

DON STRONG, et al., Plaintiffs,
v.
REPUBLIC SERVICES, INC., et al., Defendants.

          MEMORANDUM AND ORDER

          JEAN C. HAMILTON UNITED STATES DISTRICT JUDGE

         This matter is before the Court on Plaintiffs' Motion for Remand.[1] (ECF 21). The matter is fully briefed and ready for disposition.

         FACTUAL BACKGROUND

         On May 4, 2017, Plaintiffs filed their Complaint in the Circuit Court of St. Louis County, Missouri (State court). (ECF 10 (Complaint)). As relevant to the pending Motion to Remand, Plaintiffs' Complaint alleges the following: The individual Plaintiffs are all extended members of the Boenker family, and are owners of the Boenker family farm, which lies directly adjacent to the Westlake Landfill and the Bridgton Landfill (jointly, the Landfills); Defendant Republic Systems, Inc., is and has been responsible for operating the Landfills; Defendant Bridgeton Landfill, LLC, owns the Landfills; in 1988, Defendant Westlake Landfill, Inc., changed its name to Laidlaw Waste Systems, Inc., and, in 1998, merged into Defendant Bridgeton Landfill, LLC; Defendant Allied Services, LLC, is the sole member of Defendant Bridgeton Landfill, LLC, and oversees the operation and management of the Landfills; Defendant Rock Road Industries, Inc., owns and/or owned the West Lake Landfill; Defendants Jared Romaine and David Vasbinder worked at the Bridgeton Landfill; and Plaintiffs are all citizens of Missouri and at least one Defendant is a citizen of Missouri. (ECF 10, ¶¶ 1, 31-37).

         Plaintiffs further allege that “Defendants own[ed] and operat[ed] [the Landfills] which accepted radioactive waste without a license to do so”; that the “radioactive waste [] spread to the Boenker family farm causing personal injury, property damage, and the need for medical monitoring”; and that “Defendants have also so mismanaged the Landfills that an underground fire now burns out of control and threatens the nuclear waste.” (ECF 10, ¶ 1). Further, in their Complaint, Plaintiffs allege that 40, 000 tons of radioactive waste was accepted by the Landfills in 1973; that the radioactive waste came from Cotter Corporation's Latty Avenue site; that Cotter was a “known possessor of radioactive material at the time”; and that neither the Landfills' owner nor operator sought a license from the Nuclear Regulatory Commission (NRC) prior to accepting and receiving the radioactive material.

         Additionally, Plaintiffs allege that Defendants have previously declared to this court that the Price Anderson Act (PAA), 42 U.S.C. § 2011, et seq., does not apply to them because the Landfills were not licensed to accept or receive radioactive materials.[2] Plaintiffs contend that, because Defendants “were not licensed to accept or receive radioactive materials and have not entered an indemnification agreement concerning their acceptance of radioactive materials, ” the PAA does not apply to Plaintiffs' claims, Plaintiffs' claims “are not public liability actions” under the PAA, 42 U.S.C. § 2210, and Plaintiffs, therefore, may proceed in State court. (ECF 10, ¶¶ 40-41, 43-47). Plaintiffs seek a judgment against Defendants for compensatory and punitive damages caused by Defendants' alleged “intentional, reckless, and/or negligent conduct in owning, operating, and/or managing the [L]andfills.” They also seek “Medical Monitoring.” (ECF 10, ¶¶ 2, 111-113).

         As further relevant to Plaintiffs' Motion to Remand, Defendants have submitted a copy of a Source Material License (the License or 1969 Source Material License) for uranium, issued to Cotter by the Atomic Energy Commission (AEC), on December 3, 1969. The License states that the “[a]uthorized place of use” was Cotter's facility located at 9200 Latty Avenue, Hazelwood, Missouri; that the “[m]aximum quantity of source material which [Cotter] [could] possess at any one time under [the] license [was] unlimited”; and that the License was to expire on December 31, 1974. (ECF 32.1).[3] The License authorized Cotter “to receive, possess and import the [designated] source material [], to use such material for the purpose(s) and at the place(s) designated [], and to deliver or transfer such material to persons authorized to receive it in accordance with the regulations” of Title 10 of the Code of Federal Regulations, Chapter 1, Part 40. (ECF 32.1).

         Defendants removed this matter from State court to federal court, on June 9, 2017, pursuant to 28 U.S.C. § 1331, contending that this Court has subject-matter jurisdiction over Plaintiffs' cause of action because it “arises under” federal law, in particular, the PAA, 42 U.S.C. §§ 2011, et seq. (ECF 1). In the pending Motion to Remand, Plaintiffs contend that this Court does not have subject-matter jurisdiction and they reiterate the allegations of their Complaint regarding the PAA's inapplicability to this matter. (ECF 21).

         REMOVAL and FEDERAL SUBJECT MATTER JURISDICTION

         Except as otherwise expressly provided by Congress, civil actions for which the district courts of the United State have original jurisdiction may be removed from state court to federal district court. 28 U.S.C. §§ 1441(a), 1446. A party opposing removal may file a motion to remand to state court. 28 U.S.C. § 1447(c). The party removing and opposing remand has the burden of establishing federal subject matter jurisdiction. Iowa Lamb Corp. v. Kalene Indus., Inc., 871 F.3d 1149, 1154 (8th Cir. 1994); In re Business Men's Assur. Co. of America, 992 F.2d 181, 183 (8th Cir. 1983) (per curiam). Upon considering a motion to remand, a district court is “required to resolve all doubts about federal jurisdiction in favor of remand.” Business Men's Assurance, 992 F.2d at 183 (citing Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1010 (3d Cir. 1987)).

         “The presence or absence of federal-question jurisdiction is governed by the ‘well-pleaded complaint rule, ' which provides that federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint.” Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987) (quoting Gully v. First Nat'l Bank, 299 U.S. 109, 112-113 (1936)). See also Gaming Corp. of America v. Dorsey & Whitney, 88 F.3d 536, 542 (8th Cir. 1996) (“The ‘well-pleaded complaint rule' requires that a federal cause of action must be stated on the face of the complaint before the defendant may remove the action based on federal question jurisdiction.”) (quoting Caterpillar, 482 U.S. at 392). Because federal law provides that plaintiffs are the “masters” of their claims, plaintiffs “may avoid federal jurisdiction by exclusive reliance on state law.” Caterpillar, 482 U.S. at 392.

         Even in situations where a cause of action based on a federal statute does not appear on the face of the complaint, preemption based on a federal statutory scheme may apply in circumstances where “the pre-emptive force of a statute is so extraordinary that it converts an ordinary state common-law complaint into one stating a federal claim.” Caterpillar, 482 U.S. at 393 (internal quotation and citation omitted). See, e.g., Metro. Life Ins. Co. v. Taylor, 481 U.S. 58 (1987) (where a former employee alleged breach of contract, retaliatory discharge, and wrongful termination of disability benefits in state court complaint, the court held that the former employee's claims were preempted by the Employee Retirement and Income Security Act (ERISA); plaintiff's claims were necessarily federal in character; and, therefore, removal under 28 U.S.C. § 1441(a) was proper). “Where a complaint raises issues to which federal law applies with complete preemptive force, the [c]ourt must look beyond the face of the complaint in determining whether remand is proper.” Green v. Arizona Cardinals Football Club, LLC, 21 F.Supp.3d 1020, 1025 (E.D. Mo. 2014). As further explained by the Eighth Circuit, the exception to the well-pleaded complaint rule applies where a federal statute provides “an exclusive cause of action for the claim asserted and also set[s] forth procedures and remedies governing that cause of action.” Johnson v. MFA Petroleum Co., 701 F.3d 243, 248 (8th Cir. 2012). Thus, although a plaintiff has only filed state law claims, a court may conclude that the plaintiff has “simply brought a mislabeled federal claim, which may be asserted under some federal statute.” Johnson, 701 F.3d at 247 (internal quotation marks and citation omitted).

         LEGAL FRAMEWORK

         The Atomic Energy Act of 1954 (AEA), as amended, 42 U.S.C. §§ 2011-2281, “grew out of Congress' determination that the national interest would be best served if the Government encouraged the private sector to become involved in the development of atomic energy for peaceful purposes under a program of federal regulation and licensing.” Pacific Gas and Elec. Co. v. State Energy Res. Conservation & Dev. Comm'n, 461 U.S. 190, 206-207 (1983). “[AEA] implemented this policy decision by providing for licensing of private construction, ownership, and operation of commercial nuclear power reactors.” Id. at 207 (citing Duke Power Co. v. Carolina Envtl. Study Grp., Inc., 438 U.S. 59, 63 (1978)). In 1957, after it “‘became apparent that profits from the private exploitation of atomic energy were uncertain and the accompanying risks substantial, '” Congress amended the AEA with the PAA, 42 U.S.C. § 2011, et seq., “which provided certain federal licensees with a system of private insurance, Government indemnification, and limited liability for claims of ‘public liability.'”[4]El Paso Natural Gas. Co. v. Neztsosie, 526 U.S. 473, 476 (1999) (quoting Duke Power, 438 U.S. at 63 and 42 U.S.C. § 2014(w)).

         The PAA had three “central elements.” The first element was to “set a ceiling on the aggregate liability which could be imposed upon those engaged in the use and handling of radioactive material either through a contract with the Federal Government or under a license issued by the Federal Government for the private development of such activities.” In re TMI Litigation Cases Consol. II (TMI II), 940 F.2d 832, 852 (3rd Cir. 1991). The second element channeled liability in that “any entity exposed to potential liability for activity resulting in a nuclear incident, even if it were not a direct participant in the activity, was entitled to indemnification.” Id. (internal quotation marks and citation omitted). Finally, the PAA provided that “all public liability claims above the amount of required private insurance protection would be indemnified by the Federal Government, up to the aggregate limit on liability.” Id. (internal quotation marks and citation omitted).

         The PAA “mandated that an assured ‘pool' of available funds be established to cover certain liabilities which might arise out of activities related to licenses.” Gilberg v. Stepan Co., 24 F.Supp.2d 325, 333 (D. N.J. 1998), disagreed with on other grounds, Estate of Ware v. Hosp. of the Univ. of Penn, 871 F.3d 273 (3rd Cir. 2017). A licensee “was required as a condition of its license to maintain ‘financial protection, ' consisting of either ‘private insurance, private contractual indemnities, self insurance, [or] other proof of financial responsibility.'” Gilberg, 24 F.Supp.2d at 333. (quoting 42 U.S.C. §§ 2210(a) & (b)). The AEC itself “was required to enter into an indemnification agreement with any licensee who was required by license to maintain financial protection.” Id. (citing 42 U.S.C. § 2210(c)).

         Among other things, as relevant, the PAA was amended in 1988 to “alter the breadth of the compensation system to cover activity related to disposal of nuclear waste, ” to “create[] a federal cause of action, ” and to “channel[] liability to licensees.” TMI II, 940 F.2d at 853-54. The amendments to the PAA also provided “for removal of, and original federal jurisdiction over, claims arising from a ‘nuclear incident, '” as discussed further below. Id. at 853.

         Pursuant to the 1988 amendments, “public liability action” is defined by the PAA, 42 U.S.C. § 2014(hh), as follows:

The term “public liability action, ” as used in section 2210 of this title, means any suit asserting public liability. A public liability action shall be deemed to be an action arising under section 2210 of this title, and the substantive rules for decision in such action shall be derived from the law of the State in which the nuclear incident involved occurs, unless such law is inconsistent with the provisions of such section.

(emphasis added).

         This definition of public liability action “had the effect of creating a federal cause of action under the [PAA] for public liability claims arising out of a nuclear incident.” Gilberg, 24 F.Supp.2d at 339 (citing TMI II, 940 F.2d at 857). Thus, a “public liability action” requires a “nuclear incident.” TMI II, 940 F.2d at 855.

         As relevant, “public liability” is defined by the PAA, 42 U.S.C. § 2014(w), as:

any legal liability arising out of or resulting from a nuclear incident . . . except . . . (iii) whenever used in subsections (a), (c), and (k) of section 2210 of this title, claims for loss of, or damages to, or loss of use of property which is located at the site of and used in connection with the licensed activity where the nuclear incident occurs. “Public liability” also includes damage to property of persons indemnified: Provided, That such property is covered under the terms of the financial protection required, except property which is located at the site of an used in connection with the activity where the nuclear incident occurs.

         “Nuclear incident, ” is defined, in relevant part, by the PAA, 42 U.S.C. § 2014(q), as:

any occurrence, including an extraordinary nuclear occurrence, within the United States causing, within or outside the United States, bodily injury, sickness, disease, or death, or loss of or damage to property, or loss of use of property, arising out of or resulting from the radioactive, toxic, explosive or other hazardous properties of source, special nuclear, or byproduct material. . . . And provided further, That as the term is used in section 2210(c) of this title, it shall include any such occurrence outside both the United States and any other nation if such occurrence arises out of or results from the radioactive, toxic, explosive, or other hazardous properties of source, special nuclear, or byproduct material licensed pursuant to subchapters V, VI, VII, and IX of this division, which is used in connection with the operation of a licensed stationary production or utilization facility or which moves outside the territorial limits of the United States in transit from one person licensed by the Nuclear Regulatory Commission to another person licensed by the Nuclear Regulatory Commission.

(emphasis added).

         “Extraordinary nuclear occurrence” is defined by the PAA, 42 U.S.C. ...


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