Remand for Navy asbestos case denied based on federal contractor defense

By Heather Isringhausen Gvillo | Jun 24, 2014

CHICAGO (Legal Newsline) - An Illinois federal court denied a former U.S. Navy serviceman's motion to remand based on sufficient evidence supporting the defendant's federal contactor defense.

Judge Sara L. Ellis delivered the opinion on April 28 in favor of defendant Crane Co., making it very clear that she was only determining whether federal jurisdiction was proper and made no conclusions on whether Crane would prevail on the federal contractor defense - adding that the case is not yet at that stage.

In doing so, she held that Crane satisfied all requirements of the removal statute.

Ellis governed the case according to the Ruppel decision, in which the U.S. Court of Appeals for the Seventh Circuit reversed an order remanding the case from federal court, finding that federal jurisdiction was proper because the defendant had satisfied all elements of federal officer jurisdiction.

Claimant William Totten filed his lawsuit in state court against roughly 40 defendants alleging that asbestos exposure from their products caused him to develop mesothelioma. He also alleged Crane failed to warn him of the dangers associated with asbestos exposure hazards.

Crane manufactured valves, which contained asbestos-containing gaskets and packing made by third-parties and were used aboard Navy ships built during WWII.

He claims he was exposed to asbestos while serving in the U.S. Navy from 1956 to 1958 and when he worked as a civilian from 1962 to 1983.

Crane removed the case to the United States District Court for the Northern District of Illinois, Eastern Division, asserting that the government contractor defense provided federal jurisdiction.

In its removal, Crane attached the incorrect complaint, including the original complaint rather than the first amended complaint. It also attached affidavits of Anthony Pantaleoni, retired Rear Admiral David Sargent, Jr., and Dr. Samuel Forman.

Crane corrected this mistake by attaching the correct complaint to its opposition to Totten's motion for remand.

Ellis concluded that the court will not allow this "minor" defect to defeat Crane's right to federal jurisdiction.

As for the affidavits Crane provided, they describe the Navy specifications required from Crane and other contractors manufacturing products for use aboard the ships, as well as the Navy's historic knowledge, warnings and remedial measures regarding asbestos.

It also attached examples of Navy-issued engineering specifications for valves similar to those Crane manufactured.

During removal, Crane argued that the removal statute provides federal jurisdiction because the alleged acts were undertaken at the direction of the Navy.

In order to make its decision regarding jurisdiction, Ellis stated that the court must determine whether Crane raised a plausible argument for the government contractor defense to apply.

She found that the Ruppel decision is proper to determine jurisdiction.

Although Totten provides arguments detailing why Ruppel should not govern this case, Ellis explained he failed to provide "any compelling reason to distinguish this case from Ruppel."

Totten asserts that in the Ruppel decision, he brought a claim for use of asbestos, while Totten only alleges failure to warn.

Ellis disagreed, stating that in Ruppel, the Seventh Circuit affirmed summary judgment on the basis that the government contractor defense precluded the plaintiff's claim for failure to warn.

"Additionally," Ellis wrote, "Mr. Totten's attempt to distinguish Ruppel only sheds light on the cases' similarity, as Mr. Ruppel made the same argument that Mr. Totten raises here: 'Ruppel's primary argument on appeal is his complaint contains only failure-to-warn claims, presumably, because he thinks the government contractor defense is less applicable to these suits.'"

However, the Seventh Circuit rejected the argument, ruling that the federal contractor defense applied to the claims for failure to warn.

Totten also argued that Crane cannot prove federal jurisdiction because it failed to attach its contracts with the Navy. As part of his argument, Totten claims that perhaps Crane sold stock parts to the government.

Despite Totten's argument, Pantaleoni's affidavit outlines that Crane contracted directly with the Navy, subjecting the company to "an extensive set of federal standards and specifications," the judge wrote.

Ellis concluded that the affidavit was sufficient to demonstrate that Crane had a contract with the Navy, and was therefore sufficient to prove jurisdiction.

Totten also attempted to distinguish Ruppel from the case at hand by asserting that Ruppel "hinged on the 'highly specialized' nature of the equipment at issue."

In doing so, he argued that the product at issue in Ruppel, a turbine, is more complex than the Crane valves and therefore requires more precise specifications.

He further noted that the Ruppel defendant submitted more evidence supporting its federal contractor defense than Crane did.

Ellis disagreed, stating that the court is satisfied with the evidence provided by Crane at this stage in litigation.

"The affidavits show that the Navy relies on countless contractors working under exact specifications to ensure that the various pieces work together properly," Ellis wrote. "This leads the court to conclude that Crane has raised a plausible argument that it was subject to reasonably precise specifications."

Therefore, Ellis concluded that Crane satisfied every element required by the federal officer removal statute, reminding the parties that the question at this point is not whether Crane will ultimately prevail on its defense, but whether a federal court has jurisdiction to hear Crane's defense.

"Crane is not required 'virtually to win [its] case before [it] can have it removed," she added.

From Legal Newsline: Reach Heather Isringhausen Gvillo at

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