Introduction

The case of Johnathon Mohr, for himself and others similarly situated v. Trustees of the University of Pennsylvania (93 F.4th 100) presents a pivotal moment in the interpretation of federal-officer removal statutes. This legal dispute centers around Plaintiffs' allegations that Penn Medicine improperly shared sensitive patient information with Facebook through the use of tracking pixels within its patient portals, thereby violating Pennsylvania privacy laws. The central issue revolves around Penn's attempt to remove a state court class action to federal court under 28 U.S.C. § 1442(a)(1), a statute that permits the removal of cases involving federal officers. This commentary delves into the background of the case, summarizes the court's findings, analyzes the legal reasoning and precedents cited, and explores the broader implications of the Judgment on future legal proceedings and privacy law enforcement.

Summary of the Judgment

In February 2023, Plaintiffs initiated a class action lawsuit in the Court of Common Pleas of Philadelphia County against the Trustees of the University of Pennsylvania, alleging that Penn Medicine's patient portals unlawfully shared confidential patient data with Facebook, contravening Pennsylvania privacy statutes. Penn sought to transfer the case to federal court under the federal-officer removal statute, 28 U.S.C. § 1442(a)(1), arguing that its actions in operating the patient portals were conducted "under" the federal government due to its participation in the Meaningful Use Program (now the Promoting Interoperability Program) established under the Health Information Technology for Economic and Clinical Health Act (HITECH Act). The District Court rejected Penn's removal request, determining that Penn did not meet the statutory requirements to be considered a federal officer acting under the federal government. Penn appealed this decision to the Third Circuit Court of Appeals. The Appellate Court affirmed the District Court's ruling, concluding that Penn's actions in operating the patient portals were not conducted under delegated federal authority but rather constituted compliance with federal regulations while operating its own business. As such, the case was appropriately remanded to state court.

Analysis

Precedents Cited

The Judgment extensively references several key cases and statutory provisions to elucidate the interpretation of 28 U.S.C. § 1442(a)(1). Notably:

• Maglioli v. All. HC Holdings LLC, 16 F.4th 393 (3d Cir. 2021) – Established principles for reviewing remand orders and the de novo standard of review for subject-matter jurisdiction.
• Watson v. Philip Morris Cos., 551 U.S. 142 (2007) – Provided the foundational understanding of the "acting under" requirement, emphasizing the protection of federal officers from state court interference.
• Papp v. Fore-Kast Sales Co., 842 F.3d 805 (3d Cir. 2016) – Distinguished between facial and factual challenges in motions to remand, reinforcing the necessity to accept removal notices' factual allegations as true when unchallenged.
• Doe v. BJC Health Sys., 89 F.4th 1037 (8th Cir. 2023) – Clarified that mere compliance with federal regulations does not suffice for "acting under" the federal government.
• Other cases from various circuits, reinforcing the stance that private entities complying with federal programs do not automatically act under federal authority unless they fulfill specific criteria.

Legal Reasoning

The crux of the court's legal reasoning centers on the interpretation of the "acting under" clause within 28 U.S.C. § 1442(a)(1). The court delineates four requirements for removal under this statute:

• The defendant must be a "person" as defined by the statute.
• Plaintiff’s claims must be based upon the defendant "acting under" the United States, its agencies, or its officers.
• The claims must be "for or relating to" an act under color of federal office.
• The defendant must present a colorable federal defense to the plaintiff’s claims.

Penn's primary contention was that its operation of the patient portals, pursuant to receiving federal incentives and complying with HITECH Act mandates, constituted "acting under" federal authority. However, the court disagreed, emphasizing that:

• Operating the patient portal, despite adhering to federal program objectives, is a business activity conducted by Penn, not by the federal government.
• Penn did not receive any delegated legal authority to perform governmental functions but was merely complying with federal regulations to receive incentives.
• The relationship between Penn and the federal government did not equate to that of a government contractor, where specific duties are performed under direct federal supervision.
• Participation in the Meaningful Use Program does not rise to the level of "acting under" the federal government required for removal jurisdiction.

Consequently, the court held that Penn did not satisfy the second requirement of § 1442(a)(1) and thus was not entitled to have the case removed to federal court.

Impact

This Judgment has significant implications for both federal removal statutes and privacy law enforcement:

• Clarification of Removal Jurisdiction: The decision provides clearer boundaries for when private entities involved in federal programs can be considered as "acting under" federal authority. Merely complying with federal regulations or receiving federal incentives does not suffice for removal under § 1442(a)(1).
• Impact on Healthcare Providers: Healthcare organizations participating in federal programs like the Meaningful Use Program must recognize that their operational activities, even when federally incentivized, do not inherently place them under federal jurisdiction for litigation purposes unless specific delegated authority is present.
• Privacy Law Enforcement: Plaintiffs alleging privacy violations by institutions participating in federal health programs can pursue claims in state courts without the risk of removal to federal court based solely on participation in such programs.
• Consistency Across Circuits: By aligning with rulings from other circuits, this Judgment promotes uniformity in the interpretation of federal removal statutes, reducing uncertainty for parties involved in multi-jurisdictional legal matters.

Complex Concepts Simplified

Federal-Officer Removal Statute (28 U.S.C. § 1442(a)(1))

This statute allows certain federal officers and individuals assisting them to transfer lawsuits filed in state courts to federal courts. The primary purpose is to shield federal officers from lawsuits that might interfere with their official duties. For removal to apply:

• The defendant must be a federal officer or someone acting on behalf of the federal government.
• The lawsuit must relate to actions taken under federal authority.
• The defendant must present a plausible federal defense.

In simple terms, not every interaction a private company has with the federal government qualifies the company for removal to federal court. There must be a direct and substantial connection to federal authority.

Acting Under the Federal Government

"Acting under" implies that the private entity is performing roles or tasks that are integral to federal government functions, typically under direct oversight or delegation. It goes beyond merely complying with federal regulations or participating in federally funded programs.

For example, a government contractor building military equipment directly under a federal contract is "acting under" the federal government because they are performing specific tasks assigned and supervised by the government. In contrast, a hospital adopting federal health IT standards to receive incentives is simply complying with regulations and not performing federal duties.

Conclusion

The Third Circuit's affirmation in Mohr v. Trustees of the University of Pennsylvania underscores the nuanced interpretation of the federal-officer removal statute, particularly the "acting under" requirement. By clarifying that participation in federal programs does not equate to performing federal duties, the court has set a precedent that safeguards state courts from being overruled by federal removal in cases where federal involvement is limited to regulatory compliance and incentive participation. This ensures that plaintiffs retain the ability to seek redress in state courts for violations of state laws, such as privacy regulations, without the barrier of unnecessary removal to federal jurisdictions. The Judgment thereby reinforces the principle that federal removal is reserved for genuine instances of federal authority delegation, maintaining the balance between federal and state judicial systems.