The opinion of the court was delivered by: William M. Skretny Chief Judge United States District Court
DECISION AND ORDER, ON FEBRUARY 12, 2009,
This document relates to:
On February 12, 2009, Continental Connection Flight 3407 crashed on approach to the Buffalo Niagara International Airport, killing all 49 people aboard and one person on the ground. All federal litigation related to the crash has been transferred by the United States Judicial Panel on Multidistrict Litigation to the Western District of New York for coordinated or consolidated pretrial proceedings, pursuant to 28 U.S.C. § 1407. (Docket No. 1.*fn1
Presently before this Court are Motions to Remand filed by the plaintiffs in five lawsuits that the defendants removed from the New York State Supreme Court, County of Erie. Plaintiffs contend that remand is required because federal jurisdiction is nonexistent. Plaintiffs also seek costs and attorney fees. For the following reasons, Plaintiffs' Motions to Remand will be granted and their request for attorney fees and costs will be denied.
In November 2009, Plaintiffs filed their respective complaints in the New York Supreme Court, County of Erie, against Defendants Colgan Air, Inc., Pinnacle Airlines Corp., Continental Airlines, Inc., and FlightSafety International, Inc. ("FlightSafety"). The complaints are substantially similar to one another: each asserts negligence claims against Colgan, Pinnacle, and Continental (Johnston Complaint, ¶¶ 42-48*fn2 ); negligent performance of a contractual duty, third-party beneficiary breach of contract, and negligence claims against FlightSafety (Johnston Complaint, ¶¶ 49-66); and wrongful death and conscious pain and suffering/pre-impact terror claims against all defendants (Johnston Complaint, ¶¶ 67-72).
Most pertinent here are the allegations against FlightSafety, which is a New York corporation with its principal place of business in New York. (Johnston Complaint, ¶ 8.) Plaintiffs allege that FlightSafety trained (or failed to train) the captain of the aircraft, Marvin Renslow, and the first officer, Rebecca Lynne Shaw, pursuant to a training agreement with Colgan, Pinnacle, and/or Continental. (Johnston Complaint, ¶¶ 13, 33, 35.)
Plaintiffs allege that FlightSafety was responsible for providing the necessary flight simulator training to qualify Renslow as a captain on the aircraft at issue - a Bombardier Dash 8-Q400 - and that Renslow was trained in November 2008 in St. Louis, MO, using FlightSafety's Dash 8-Q400 simulator. (Johnston Complaint, ¶¶ 33, 34, 62.)
Plaintiffs further allege that FlightSafety was responsible for providing the necessary ground and transition flight simulator training to qualify Shaw as a first officer and that Shaw completed the "First Officer Dash 8-Q400 Initial/Transition Course" at FlightSafety's Toronto Learning Center. (Johnston Complaint, ¶¶ 35, 36, 61.)
The thrust of Plaintiffs' claims against FlightSafety is that its training of Renslow and Shaw was improper, insufficient, and substandard, and caused Renslow and Shaw to not recognize ice-related aerodynamic conditions present at the time of the crash. (Johnston Complaint, ¶ 28.) This caused a decrease in airspeed to a near stall, which activated the aircraft's anti-stall system and caused the aircraft to pitch nose down and the autopilot to disconnect. (Johnston Complaint, ¶ 29.) Plaintiffs allege that in reaction to this situation, the aircraft experienced a "pilot-induced pitch up to a deck angle of 30 degrees or more above the horizontal." (Johnston Complaint, ¶ 30.) This reaction, in turn, allegedly caused a loss of airspeed and lift, which resulted in a full aerodynamic stall and loss of flight control. (Johnston Complaint, ¶ 30.) Plaintiffs allege that the aircraft then rolled up on its right wing to a near inverted and steep nose-down condition, from which it never recovered. (Johnston Complaint, ¶ 31.)
Plaintiffs allege that FlightSafety never instructed Renslow and Shaw on how to use the stick-pusher mechanism in the Dash 8-Q400, and in addition, trained them using simulators and equipment that did not accurately represent the performance of a Dash 8-Q400. (Johnston Complaint, ¶¶ 38, 39.) Plaintiffs further contend that "tremendous financial pressure" at FlightSafety resulted in it providing substandard flight and simulator training, such that key aircraft components, like the stick-pusher mechanism in the Dash 8-Q400, were not adequately or accurately represented by flight simulation and training devices, and thus not adequately explained or taught. (Johnston Complaint, ¶ 40.)
In their claim against FlightSafety for negligent performance of a contractual duty, Plaintiffs allege that the passengers of Continental Connection Flight 3407 relied on FlightSafety's performance of its contractual obligations to Colgan, Pinnacle, and/or Continental, but that FlightSafety negligently performed the flight training it was obligated to provide. (Johnston Complaint, ¶¶ 50, 52.) Plaintiffs also allege that FlightSafety's negligent performance created or increased a risk of harm to others, created or exacerbated a dangerous condition, and launched a force and/or instrument of harm that proximately caused the fatal aircrash. (Johnston Complaint, ¶¶ 51, 53.)
In their third-party beneficiary breach of contract claim against FlightSafety, Plaintiffs allege that the passengers aboard Continental Connection Flight 3407 were direct or intended third-party beneficiaries of the training or other contracts that FlightSafety breached. (Johnston Complaint, ¶ 56.)
In their negligence claim against FlightSafety, Plaintiffs allege that FlightSafety's "negligence, careless acts and omissions, wrongful acts and omissions, wanton and willful acts and omissions, and recklessness and dereliction of duty . . . in instructing and training" Renslow and Shaw proximately caused the aircrash. (Johnston Complaint, ¶¶ 64, 65.)
A. Defendants' Removal and Plaintiffs' Motion for Remand
A civil action brought in state court may be removed by a defendant to a federal district court of original jurisdiction. 28 U.S.C. § 1441. District courts have original jurisdiction over all civil actions arising under the Constitution, treaties, or laws of the United States, and over all civil actions between citizens of different states, if the amount in controversy exceeds $75,000. 28 U.S.C. §§ 1331, 1332(a)(1).
Out of respect for states' rights and in keeping with the limited jurisdiction of federal courts, removal jurisdiction is "strictly construed," with all doubts resolved against removal. Syngenta Crop Prot., Inc. v. Henson, 537 U.S. 28, 32, 123 S.Ct. 366, 154 L.Ed.2d 368 (2002); In re Methyl Tertiary Butyl Ether ("MTBE") Prods. Liability Litig., 488 F.3d 112, 124 (2d Cir. 2007). And the removing party bears the burden of establishing proper jurisdiction. United Food & Commercial Workers Union v. Centermark Props. Meriden Square, Inc., 30 F.3d 298, 301 (2d Cir. 1994); Funeral Fin. Sys., Ltd. v. Solex Express, Inc., No. 01-CV-6079(JG), 2002 WL 598530, at *3 (E.D.N.Y. Apr. 11, 2002) (noting that in the face of a motion to remand, the burden falls on the defendant to prove the existence of jurisdiction and that the case is properly in federal court).
Defendants removed these actions on the basis of federal jurisdiction under 28 U.S.C. §§ 1331 and 1332(a)(1). They maintain that FlightSafety's New York citizenship does not destroy diversity under the doctrine of fraudulent joinder, and that federal-question jurisdiction exists because otherwise applicable state law has been preempted by federal law.
In their Motion to Remand, Plaintiffs challenge Defendants' jurisdictional assertions and insist that remand to state court is required. They argue that this Court lacks diversity jurisdiction because FlightSafety is a citizen of New York and was not fraudulently joined, and lacks federal-question jurisdiction because federal law does not preempt their state law causes of action.
B. Diversity Jurisdiction
Assuming that the amount-in-controversy requirement is met, jurisdiction is proper under 28 U.S.C. § 1332 (a) only when all adverse parties to the litigation are citizens of different states. See Herrick Co. v. SCS Commc'ns, Inc., 251 F.3d 315, 322 (2d Cir. 2001). When a corporation is involved, it is deemed "a citizen of any State by which it has been incorporated and of the State where it has its principal place of business." 28 U.S.C. § 1332(c)(1). A corporation's principal place of business is its "nerve center" - "the place where the corporation's high level officers direct, control, and coordinate the corporation's activities." Hertz Corp. v. Friend, __ U.S. __, 130 S.Ct. 1181, 1186, __ L.Ed.2d __ (2010).
Here, on the face of Plaintiffs' complaints, complete diversity does not exist. Colgan is a citizen of Virginia; Pinnacle is a citizen of Delaware and Tennessee; and Continental is a citizen of Delaware and Texas. (Johnston Complaint, ¶¶ 2, 4, 6.) But Plaintiffs and FlightSafety are citizens of New York.*fn3 (Johnston Complaint, ¶¶ 1, 8.) Nonetheless, Defendants maintain that diversity jurisdiction exists because Plaintiffs fraudulently joined FlightSafety solely to destroy ...