Cuomo v. Crane Co.

GERARD E. LYNCH

Reversed.

Alani Golanski, Weitz & Luxenberg, P.C., New York, N.Y., for Plaintiff–Appellee Susan Cuomo. Michael James Ross (Angela DiGiglio and Nicholas P. Vari, on the brief), K & L Gates LLP, New York, N.Y., for Defendant–Appellant Crane Co.
Before LEVAL, LYNCH, and DRONEY, Circuit Judges.

After defendant-appellant Crane Co. removed plaintiff-appellee Susan Cuomo's failure-to-warn suit on the basis of the federal officer removal statute, 28 U.S.C. § 1442(a)(1), the U.S. District Court for the Southern District of New York (Shira A. Scheindlin, J.) granted Cuomo's motion to remand the case to state court. Reviewing the evidence submitted by both parties, the court concluded that because the evidence did not establish that the Navy either affirmatively prohibited or dictated asbestos warnings on Crane's equipment, Crane did not raise a colorable federal contractor defense. Because we conclude that Crane's proffered evidence sufficed to assert a colorable federal defense at the removal stage, we reverse.

In support of removal, Crane presented several affidavits and numerous documentary exhibits suggesting that (1) the Navy provided detailed specifications for the valves that Crane supplied for its vessels, (2) Crane's valves must have conformed to those specifications if they were accepted by the Navy, and (3) the Navy was well aware of the health risks associated with asbestos by the 1970s. This evidence provides a colorable factual basis for each prong of the federal contractor defense. Indeed, several district courts and at least one other Circuit court have found a near-identical showing adequate to merit federal removal under § 1442(a)(1). See Leite v. Crane Co., 749 F.3d 1117, 1120 (9th Cir.2014); see also, e.g., Crews v. Air & Liquid Sys. Corp., No. 7:12–CV–1678, 2014 WL 636362, at *6 (N.D.N.Y. Feb. 18, 2014); Gates v. A.O. Smith Water Prods. Co., No. 3:13–CV–1435, 2014 WL 104965, at *5 (N.D.N.Y. Jan. 9, 2014). To the extent that Cuomo's competing testimony challenges the accuracy or reliability of Crane's evidence, it does not undercut Crane's right to removal, but rather raises the very type of factual dispute about the validity of the defense that should be submitted to the judgment of a federal court. See Osborn, 549 U.S. at 251, 127 S.Ct. 881.

The district court concluded, and Cuomo now argues, that Crane cannot make even a “colorable” bid for the federal contractor defense because it provided no evidence that the Navy prohibited or actively prescribed the content of any proposed asbestos labels. That argument exaggerates both the requirements of the federal contractor defense and the threshold for federal removal under § 1442(a)(1). In the context of failure-to-warn claims, as in the defective-design context, the federal contractor defense demands proof that the government approved “reasonably precise specifications for the allegedly [defective] equipment,” Agent Orange, 517 F.3d at 88 (emphasis added and alterations omitted); it does not require that the government issue reasonably precise specifications for each particular label. While Cuomo correctly notes that In re Joint Eastern & Southern District New York Asbestos Litigation demanded some evidence that the disputed product warnings “resulted from a determination of a government official, and thus that the Government itself ‘dictated’ the[ir] content,” 897 F.2d 626, 630 (2d Cir.1990) (citation omitted), “dictating” the content of a warning does not necessarily require the government to prescribe its literal terms. Rather, as we went on to clarify, a defendant need only establish that “the Government ... dictated or otherwise controlled the nature and the content of the product warnings,” id. at 632 (emphasis added); see also id. at 630 n. 4, a standard satisfied by evidence showing that “the Government, making a discretionary ... decision contrary to the requirements of state law, incorporate[d] this decision into a military contractor's contractual obligations, thereby limiting the contractor's ability to accommodate safety in a different fashion,” id. at 632.

In this case, Crane has provided evidence that the Navy issued detailed and comprehensive specifications regarding the production and packaging of its valves—specifications that for all their particularity made no mention of asbestos warnings. Whether or not that evidence will ultimately be sufficient to persuade a federal court that these specifications articulated a discretionary safety policy by the Navy effectively “limiting” Crane's ability to affix additional asbestos warnings, or even to raise a fact issue that will survive a motion for partial summary judgment, Crane has certainly provided sufficient evidence to create at this preliminary stage a “colorable” possibility of satisfying that standard.

We conclude that Crane's evidence tending to prove that the Navy issued precise specifications regarding its shipboard equipment, that the Navy would not have accepted Crane's equipment had it not conformed to those specifications, and that the Navy understood the health risk associated with asbestos easily clears the low threshold for asserting a federal contractor defense for purposes of removal under § 1442(a)(1). Respecting the policy behind the federal officer removal statute, we emphasize that the district court's role on a remand motion is not to resolve whether the defendant has established the federal contractor defense or to resolve factual disputes, but only to ensure the existence of some competent evidence supporting a “colorable” federal defense.

For the foregoing reasons, the order of the district court is REVERSED. -------- Notes: