United States District Court, S.D. New York
December 3, 2005.
SANDRA BARNABY AS ADMINISTRATRIX FOR THE ESTATE OF CAROL-ANN HENRY and DEVON SMITH, Plaintiffs,
LORCELI ALVAREZ QUINTOS, M.D., et al., Defendants. UNIVERSAL DIAGNOSTIC LABORATORIES, INC., ARNOLD L. STATINGER, M.D., and MARLENE JEAN-BAPTISTE, Third-Party Plaintiffs, v. LORCELI ALVAREZ QUINTOS, M.D., and MT. VERNON NEIGHBORHOOD HEALTH CENTER, INC., Third-Party Defendants.
The opinion of the court was delivered by: JOHN KOELTL, District Judge
OPINION AND ORDER
The third-party defendants, Lorceli Alvarez Quintos, M.D.
("Quintos"), and Mount Vernon Neighborhood Health Center ("MVHC")
(collectively the "Clinic defendants"), move to dismiss the
third-party complaint for lack of subject matter jurisdiction
pursuant to Rule 12 (b) (1) of the Federal Rules of Civil
This action was originally brought by the plaintiff in New York
State Supreme Court, Bronx County, for medical malpractice. In
addition to Quintos and MVHC, the state court action named as
defendants the third-party plaintiffs, Universal Diagnostic
Laboratories, Inc., ("Universal"), Arnold L. Statsinger, M.D.,
and Marlene Jean-Baptiste (collectively the "Lab defendants"). In
December 2003, the Clinic defendants removed the action to this
Court and the Government moved to have the United States
substituted for the Clinic defendants because they were federal
employees acting in the scope of their employment and could not
be sued.*fn1 The only remedy available would be a suit
against the United States under the Federal Tort Claims Act
("FTCA"). See 28 U.S.C. §§ 2679 (b) (1).
The United States was substituted as a defendant and the action
was dismissed against the United States without prejudice for
failure to file an administrative claim as required by
28 U.S.C. § 2675(a). The case was remanded to state court against the
remaining defendants, the Lab defendants. Thereafter, in May
2005, the Lab defendants filed a third-party complaint against
the Clinic defendants in state court, and in July 2005 the Clinic
defendants again removed the entire case to this Court pursuant to
28 U.S.C. § 1442(a)(1), 28 U.S.C. § 2679(d)(2), and 42 U.S.C. § 233(c).
The Clinic defendants now move to dismiss the third-party
complaint for lack of subject matter jurisdiction under the
doctrine of "derivative jurisdiction." Under this doctrine, this
Court lacks jurisdiction on removal because it cannot have
jurisdiction where the state court from which the action was
removed lacked jurisdiction. The state court lacked jurisdiction
because, under 28 U.S.C. § 1346 (b) (1) and 28 U.S.C. § 2679 (b)
(1), the third-party complaint against the Clinic defendants
could only be brought against the United States in the federal
The derivative jurisdiction doctrine has its roots in the
Supreme Court's decision in Lambert Run Coal Co. v. Baltimore &
Ohio R.R., 258 U.S. 377 (1922), in which the Court stated that
"[t]he jurisdiction of the federal court on removal is, in a
limited sense, a derivative jurisdiction. If the state court
lacks jurisdiction of the subject-matter or of the parties, the
federal court acquires none, although it might in a like suit
originally brought there have had jurisdiction." Id. at 382;
see also Arizona v. Manypenny, 451 U.S. 232, 242 n. 17
(1981); Minnesota v. United States, 305 U.S. 382, 389 (1939);
PT United Can Co. Ltd. v. Crown Cork & Seal Co., Inc.,
138 F.3d 65, 72-73 (2d Cir. 1998). The Lab defendants respond that dismissal pursuant to a
derivative jurisdiction theory would not be appropriate because
that doctrine is no longer viable because it has been eliminated
by 28 U.S.C. § 1441(f). Alternatively, the Lab defendants argue
that the state court had jurisdiction over the third-party claims
because exclusive federal jurisdiction under the FTCA did not
exist until the Attorney General of the United States, or his
designee, certified the Clinic defendants as federal employees
acting within the scope of their employment, the case was removed
to federal court, and the United States substituted as defendant.
With respect to the continuing viability of derivative
jurisdiction, it is clear that 28 U.S.C. § 1441(f), first adopted
in different form by Congress in 1985 (the "1985 amendment"),
eliminated derivative jurisdiction for cases removed under
28 U.S.C. § 1441.*fn2 Section 1441(a) authorizes removal for
any civil action "brought in a State court of which the district
courts of the United States have original jurisdiction." This
case, however, was removed to this court not under Section 1441,
but under 28 U.S.C. § 1442(a) (1),*fn3 28 U.S.C. § 2679 (d)
(2),*fn4 and 42 U.S.C. § 233(C).*fn5 The Lab defendants' principal contention is that
28 U.S.C. § 1441(f) should be read to eliminate the doctrine not
only for cases removed under 28 U.S.C. § 1441, but for all cases.
Such a reading, however, is foreclosed by the plain text and the
history of the statute.
The 1985 amendment, originally codified at 28 U.S.C. § 1441(e),
"The court to which such civil action is removed is
not precluded from hearing and determining any claim
in such civil action because the State court from
which such civil action is removed did not have
jurisdiction over that claim."
Judicial Improvements Act of 1985, Pub.L. 99-336 § 3,
100 Stat. 633.
In 2002, however, Congress again amended 28 U.S.C. § 1441,
redesignating the paragraph added in the 1985 amendment,
28 U.S.C. § 1441(e), as 28 U.S.C. § 1441(f), and inserting a new
subsection (e) (the "2002 amendment"). More importantly, Congress
amended the provision's text, replacing "The court to which such civil action
is removed" with the words "The court to which a civil action is
removed under this section." Pub.L. 107-273 § 11020(b) (3) (A),
116 Stat. 1758, 1827 (emphasis added).
As amended in 2002, therefore, 28 U.S.C. § 1441(f) reads:
"The court to which a civil action is removed under
this section is not precluded from hearing and
determining any claim in such civil action because
the State court from which such civil action was
removed did not have jurisdiction over that claim."
28 U.S.C. § 1441(f).
In amending the statute in 2002, and replacing less precise
language with much more specific language, Congress left no doubt
that Section 1441(f) applies only to removals under Section 1441
and not to removals under any other section of the United States
Accordingly, in the absence of a corresponding amendment to
other removal provisions, such as 28 U.S.C. § 1442, every
district court decision in this circuit to address the issue has
found that derivative jurisdiction continues to be the rule under
those provisions despite the 2002 and 1985 amendments to Section
1441. See Singleton v. Elrac, Inc., No. 03 Civ. 4979 (JFK),
2004 WL 2609554 at *1-2 (S.D.N.Y. Nov. 16, 2004); Gionfriddo v.
Salaf, 343 F. Supp. 2d 109, 111 (D. Conn. 2004); Charles v.
Inam, No. 99 Civ. 12427 (SWK), 2001 WL 79900 at *1 (S.D.N.Y.
Jan. 30, 2001); Giuffre v. City of New York, No. 00 Civ. 1517
(MBM), 2000 WL 557324 at *1 (S.D.N.Y. May 8, 2000); Moreland v. Van Buren GMC,
93 F. Supp. 2d 346, 353-55 (E.D.N.Y. 1999). Contrast Strychasz v. Maron
Const. Co., Inc., No. Civ. 3:01 CV 2063 (PCD), 2002 WL 32500874
at *2 (D. Conn. Jul. 16, 2002) (noting that derivative
jurisdiction was "eliminated to some extent" by the 1985
amendment, but declining to address the viability of derivative
jurisdiction for cases removed under 28 U.S.C. § 1442 because the
Government had cited 28 U.S.C. § 1441 as the basis for removal).
While the Court of Appeals for the Second Circuit has not,
since the 1985 or 2002 amendments, directly addressed the
continued viability of derivative jurisdiction for cases removed
pursuant to provisions other than 28 U.S.C. § 1441, it has
referred to derivative jurisdiction as a viable doctrine well
after the adoption of the 1985 amendment. See PT United Can
Co. Ltd., 138 F.3d at 72-73.*fn6
Like the above cited district courts in this Circuit, the
majority of the Courts of Appeals to address the issue have
continued to apply the doctrine of derivative jurisdiction where Section 1441 is not the basis for removal. See Kasi v.
Angelone, 300 F.3d 487, 503 n. 6 (4th Cir. 2002); Smith v.
Cromer, 159 F.3d 875, 879 (4th Cir. 1998); In re Elko Co. Grand
Jury, 109 F.3d 544, 555 (9th Cir. 1997); Edwards v. United
States Dep't of Justice, 43 F.3d 312, 316 (7th Cir. 1994).
The leading case to the contrary, heavily relied upon by the
Lab defendants, is the decision of the Court of Appeals for the
Eighth Circuit in North Dakota v. Fredericks, 940 F.2d 333,
336-38 (8th Cir. 1991). The Fredericks court concluded that
that Section 1441(f) should be read to eliminate the doctrine of
derivative jurisdiction in all cases, including removal pursuant
to 28 U.S.C. § 1444, the issue before that court.*fn7 Id.
at 336-37. While the court acknowledged that the "the words of
the statute clearly do not reach this far," it invoked the theory
of "equity of the statute" in concluding that the best way to
effectuate the basic purpose of Section 1441(f)*fn8 is to
read it as a broader Congressional repudiation of derivative
jurisdiction than the text of the statute alone might suggest.
Id. at 337. Thus because "statutes are an authoritative
expression of public policy . . . [t]hat policy should be
hospitably received by the courts, and they are free to apply it, absent good reasons to the contrary, in cases
within the spirit of the enactment, but not within its letter."
The 2002 amendment to Section 1441, adopted eleven years after
Fredericks, clearly precludes a holding that 28 U.S.C. § 1441
(f) itself eliminated derivative jurisdiction for cases removed
pursuant to provisions other than Section 1441. Congress
specifically limited the elimination of derivative jurisdiction
to cases removed under Section 1441. Had Congress intended to
abolish derivative jurisdiction altogether, it could have done so
when amending Section 1441 again in 2002, but it chose to make it
clear that the elimination of derivative jurisdiction was limited
to cases removed under Section 1441.
The Lab defendants' alternative argument is that the doctrine
of derivative jurisdiction does not apply in this case because
the state court retained jurisdiction over the Clinic defendants
until their certification as federal employees acting within the
scope of their employment, actual removal, and substitution of
the United States as defendant had all taken place.
The argument by the Lab defendants is unavailing. If the Lab
defendants were correct, they would eliminate the doctrine of
derivative jurisdiction in FTCA cases because it could always be
argued that that the state court had jurisdiction when the
federal defendant was sued and only lost jurisdiction sometime
thereafter, after the federal defendant was actually certified by
the Attorney General as a federal employee acting with the scope
of his office or employment at the time of the incident out of
which the claim arose, see 28 U.S.C. § 2679(d)(2), removal had
occurred, and a motion to substitute the United States had been
decided. This would be contrary to those cases that have employed
the doctrine of derivative jurisdiction to dismiss FTCA claims
after their removal from state court. See, e.g., Singleton,
2004 WL 2609554; Gionfriddo, 343 F. Supp. 2d 109; Charles,
2001 WL 79900.
The Lab defendants rely on Thompson v. Wheeler, 898 F.2d 406
(3d Cir. 1990), to support the argument that the state court had
jurisdiction over the third party claim when it was removed and,
therefore, derivative jurisdiction is not applicable. Thompson
is an unusual case and does not support jurisdiction in the state
court in this case. In Thompson, a lawsuit including a
third-party claim against a federal employee was removed to
federal court under 28 U.S.C. § 1442 and was thereafter dismissed
on the merits based upon a prior settlement. On appeal, the Court
of Appeals expressed doubt about whether the case was properly
removed under 28 U.S.C. § 1442 and re-characterized it as removed
under 28 U.S.C. § 2679 (d). The Court noted that other courts had
dismissed cases removed under Section 2679 (d) because the
federal courts had exclusive jurisdiction to hear FTCA claims and
the state courts lacked subject matter jurisdiction over such claims. See Thompson,
898 F.2d at 409 n. 2. The Court of Appeals did not question those
cases and those cases require dismissal here. The Thompson
court distinguished those cases because the court found that
federal jurisdiction under Section 2679 (d) lies only after the
Attorney General certifies the federal employee as acting with
the scope of his employment. Id. The "possibility that such
certification might issue does not automatically divest a state
court of subject matter jurisdiction." Id. Whatever the merits
of that position, Thompson was a case where the notice of
removal was not based on Section 2679 (d). In this case that was
one of the sections pursuant to which the case was removed, and
the Attorney General had already certified that the Clinic
defendants were federal employees acting within the scope of
their employment in December 2003, prior to the dismissal of the
case against those defendants for failure to exhaust
administrative remedies. Thus, the state court lacked
jurisdiction at the time the case was removed in July
The Attorney General's initial certification of the Clinic
defendants on December 1, 2003, remained in force at the time the third-party complaint was filed and at all times thereafter, and
as a result, the state court did not have jurisdiction over the
case at the time of its second removal to this Court. Therefore,
there is no basis for holding that derivative jurisdiction is
inapplicable in this case.
For the reasons stated above, the Government's motion to
dismiss the third-party complaint for lack of subject matter
jurisdiction is granted. The third-party complaint is
dismissed, without prejudice, and the remainder of the case is
again remanded to the New York State Supreme Court, Bronx
County. The Clerk is directed to enter a judgment and close this
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