What does it take to remove a product liability suit to federal court? For Boeing, all it took was a few seconds of flying over water. That’s what the Seventh Circuit Court of Appeals recently concluded in Lu Junhong v. Boeing Co., a case that potentially makes it easier for tort defendants to establish federal admiralty jurisdiction.
Lu Junhong arises from a July 6, 2013 incident where a Boeing 777 flying from South Korea crashed into the seawall at San Francisco International Airport upon landing, killing three and seriously injuring forty-nine. Some of the injured passengers filed suit against Boeing in Illinois state court, alleging product liability, negligence, and willful and wanton conduct under the theory that Boeing’s defectively designed systems contributed to the crash. Boeing removed the cases to federal court on the grounds of federal officer jurisdiction and federal admiralty jurisdiction and the Judicial Panel on Multidistrict Litigation was set to transfer the cases to the Northern District of California to join other suits arising out of the accident. But before the Panel formally directed the transfer, the district court remanded to state court for lack of subject-matter jurisdiction.
On appeal, the Seventh Circuit first considered whether Boeing satisfied 28 U.S.C. § 1442, which allows for removal where the action is against “[t]he United States or any agency thereof or any officer (or any person acting under that officer) of the United States or of any agency thereof.” Boeing argued that it is “acting under” a federal officer by virtue of the fact that it certifies the airworthiness of its planes in accordance with federal regulations. Rejecting this argument, the Seventh Circuit drew analogy to lawyers certifying that their briefs comply with court rules and taxpayers certifying the completion of their tax returns. In both cases, self-certification may reduce the workload of federal agencies, but it does not constitute “acting under” such agencies for purposes of § 1442. After all, “[e]very regulated firm must use its own staff to learn whether it has satisfied federal regulations.” Plaintiffs argued that the Court’s analysis should go no further, as under 28 U.S.C. § 1447(d), a district court’s order remanding a case for lack of federal jurisdiction is not reviewable, except when the removal was based on § 1442 or § 1443. In a split from the Eighth Circuit, the Court disagreed, holding that once a case is removed pursuant to § 1442, the district court’s entire order is reviewable.
The Court then moved on to the main event, Boeing’s admiralty jurisdiction argument. Under 28 U.S.C. § 1333, federal district courts have original jurisdiction of “[a]ny civil case of admiralty or maritime jurisdiction.” But how does a party establish such jurisdiction? The Court traced the modern standard back to Executive Jet Aviation, Inc. v. Cleveland which asked, “not where a wreck ended up (land or water), but whether the events leading to the accident have enough connection to maritime activity.” The standard was further refined in Jerome B. Grubart, Inc. v. Great Lake Dredge & Dock Co., which held that “a party seeking to invoke federal admiralty jurisdiction . . . must satisfy conditions both of location and of connection with maritime activity.” Such conditions are satisfied when “injury suffered on land was caused by a vessel on navigable water” and where “the character of the activity giving rise to the incident shows a substantial relationship to traditional maritime activity.”
By the Seventh Circuit’s estimation, the district court wrongfully gleaned from these and other cases an inevitability standard by which “admiralty jurisdiction is available only when an accident becomes inevitable while the plane is over water.” The district court thus based its conclusion on its finding that “the tort was neither inevitable while the plane was over water nor complete when the plane was over water.” However, a subsequent report contradicted this analysis, finding that the crash in fact was inevitable for the final ten seconds before impact, while the plane was still over the San Francisco Bay. Further, the Seventh Circuit found fault in the district court’s apparent belief that jurisdictional facts must be proven “beyond dispute.” Rather, countered the Court, “[j]urisdictional allegations control unless it is legally impossible for them to be true . . . [and] it is possible for Boeing to show that this accident was caused by, or became inevitable because of, events that occurred over navigable water.”
The only remaining question was whether an airplane is “a vessel on navigable water.” The Court answered this question in the affirmative, reasoning that functionally, an airplane operates in the same manner as an ocean-going vessel (i.e., it moves passengers and freight over waters that are outside of any sovereign territory). For the same reason, a plane bears a significant relationship to traditional maritime activity, thus satisfying the final piece of the Grubart standard.
For defendants hoping to remove their cases to federal court based on admiralty jurisdiction, Lu Junhong appears to lower the threshold. Instead of having to show with some high level of certainty that an accident was caused by events that occurred over navigable water, according to the Seventh Circuit, a defendant must only show that such causation is possible. Moreover, while a district court’s conclusion on whether admiralty jurisdiction exists is ordinarily unreviewable, the Seventh Circuit will review the district court’s entire order—including its conclusion on admiralty jurisdiction—if removal was in part based on § 1442 or § 1443.