United States District Court, E.D. Virginia, Newport News Division
HERBERT H. MULLINEX, JR. and PATRICIA E. MULLINEX, Plaintiffs,
AIR & LIQUID SYSTEMS CORPORATION, successor by merger to BUFFALO PUMPS, INC., et al, Defendants.
L. WRIGHT ALLEN UNITED STATES DISTRICT JUDGE
matters before the Court are two Reports and Recommendations
by United States Magistrate Judge Krask following
Plaintiffs' Motion for Sanctions and Plaintiffs'
Motion for Remand. The Motions were referred to United States
Magistrate Judge Krask pursuant to the provisions of 28
U.S.C. §§ 636(b)(1)(B) and (C), Federal Rule of
Civil Procedure 72(b), and Local Rule 72 for report and
recommendation ("R&R"). Both R&Rs were
filed on December 6, 2018, and Plaintiffs subsequently filed
objections to both. This Court has reviewed the record and
has considered the objections. After making de novo
findings regarding the portions objected to, and for the
reasons stated herein, the Court ADOPTS the
Report and Recommendation (ECF No. 45) to deny
Plaintiffs' Motion to Remand (ECF No. 19) and
ADOPTS the Report and Recommendation (ECF
No. 46) denying Plaintiffs' Motion for Sanctions (ECF No.
Motion to Remand
their Motion to Remand (ECF No. 19), Plaintiffs argue that
Defendant John Crane, Inc. ("JCI") removed the case
from state court under an improper assertion of a federal
contractor defense pursuant to 28 U.S.C. § 1442. ECF No.
45 at 18-21. The Magistrate Judge found that removal was
timely. Id. at 27. He also found that JCI
sufficiently asserted a "colorable federal contractor
defense" under § 1442(a)(1). Id. at 33.
Accordingly, the Magistrate Judge recommended that
Plaintiffs' Motion to Remand be denied. Id. at
first challenge the standard under which the timeliness of
removal was considered. Id. at 8. The R&R
acknowledges that a defendant must remove a case within
thirty days of the case's removability under §§
1446(b)(1) and 1446(b)(3). ECF No. 45 at 27. Plaintiffs argue
that the removal period should have begun before JCI became
"unequivocally clear and certain" that removal was
proper. The standard that was applied was derived from a
published decision of this Court. See ECF No. 45 at
29 (citing US Airways, Inc. v. PMA Capital Ins. Co.,
340 F.Supp.2d 299 (E.D. Va. 2004)). Plaintiffs argue that in
absence of any decision by the United States Court of Appeals
for the Fourth Circuit adopting that standard, this Court
should refrain from doing so. They also claim that the Fourth
Circuit disapproved of such a standard when it held that a
defendant extensively litigating in the state court had
waived its right to removal. ECF No. 45 at 26 (citing
Northrop Grumman Tech. Servs., Inc. v. DynCorp Int'l
LLC, 865 F.3d 181 (4th Cir. 2017). The Magistrate Judge
addressed the facts presented in Northrop Grumman,
finding that they differ widely from facts here because this
Defendant lacked knowledge about the basis for removal for
months and did not conduct a defense in state court for
several months before removal. ECF No. 45 at 26-27.
Court finds Northrop Grumman inapposite. Plaintiffs
fail to present any binding precedent that forbids applying
the standard applied in the R&R. The Court
OVERRULES this Objection.
Plaintiffs object to the R&R's finding that JCI did
not waive its government contractor defense in the state
court. ECF No. 47 at 22. Plaintiffs claim that JCI's
discovery responses and failure to oppose Plaintiffs'
motion to strike should constitute a waiver of the defense.
Id. The Magistrate Judge determined that JCI's
discovery responses were "not affirmative, intentional
and unambiguous statements about facts that constitute
judicial admissions." ECF No. 45 at 24. JCI lacked
sufficient notice that the Plaintiffs intended to abandon the
disclaimer. The Court agrees that it was reasonable for JCI
to believe that "JCI could not waive a defense that
Plaintiffs had already removed from the scope of the
case" via disclaimer. Id. at 25.
Plaintiffs object to the R&R's alleged failure to
credit their experts' testimony that federal law
compelled JCI to include warnings on its gaskets. ECF No. 47
at 23-24. Plaintiffs allege that the government did not
exercise discretion, as is required to present a colorable
Court need only find a "reasonable probability"
that facts support a colorable contractor defense. Here, JCI
provided sufficient evidence that the Navy "dictated or
approved the warnings that the contractor actually
provided." ECF No. No. 45 at 36; ECF No. 49 at 10.
Therefore, JCI has established a "reasonable
probability" of a colorable government contractor
defense. The Objection is OVERRULED.
Motion for Sanctions
seek sanctions (ECF No. 21) against JCI under Federal Rule of
Civil Procedure 11 for JCI's assertion of a government
contractor defense and removal thereunder. Plaintiffs argued
that removal was frivolous, but the Magistrate Judge found
that JCI acted reasonably. ECF No. 46 at 5-7. Plaintiffs also
alleged that JCI asserted the contractor defense in bad
faith, but the Magistrate Judge held that Plaintiffs failed
to establish objective evidence of an improper motive. ECF
No. 46 at 8-9. Finally, Plaintiffs claimed that JCI
misrepresented its knowledge of Plaintiffs' claims for
purposes of meeting the deadline for removal, but the R&R
recognized legal and factual grounds to support the
timeliness of JCI's removal. Id. at 10.
Accordingly, the Magistrate Judge recommended that
Plaintiffs' Motion for Sanctions be denied. ECF No. 45.
By copy of the report, each party was advised of the right to
file written objections to the findings and recommendations
made by the Magistrate Judge. Id. Plaintiffs timely
again argue that JCI knew of Plaintiffs' claims involving
warnings on the gaskets before JCI filed for removal, and
that JCI misrepresented its alleged notice of Plaintiffs'
claims. ECF No. 48 at 6. Given JCI's reasonable
uncertainty regarding Plaintiffs' claims and
Plaintiffs' failure to cite objective evidence that JCI
misled the Court, JCI's conduct does not warrant
sanctions. Plaintiffs also object to the R&R's
finding that JCI's removal was made in good faith. ECF
No. 48 at 7-8. Plaintiffs' disclaimer, which removed
claims that would implicate the federal contractor defense,
provides reasonable grounds for JCI's uncertainty as to
Plaintiffs' claims up to the eve of trial. Therefore,
sanctions are not warranted, and the Objections to this
portion of the R&R are OVERRULED.
Court, having reviewed the record and making de novo
findings regarding the positions of the R&R objected to,
ADOPTS AND APPROVES the findings and
recommendations set forth in the Reports and Recommendations
(ECF Nos. 45 and 46). It is therefore
ORDERED that Plaintiffs' Motion for