Eighth Circuit Court of Appeals Allows COVID-19 Case to Proceed in Missouri State Court

In June 2020, the plaintiff, the son of a nursing home resident who contracted and died from COVID-19, brought suit in Missouri state court against the nursing home, its corporate owners, and twelve individual defendants. Plaintiff asserted Missouri causes of action for wrongful death, negligence per se, and lost chance of survival. While none of the corporate defendants were Missouri citizens, most of the individual defendants were. Thus, after the corporate defendants were served – but prior to service on the individual defendants – the corporate defendants attempted to remove the case to federal court. The district court concluded that it lacked subject matter jurisdiction, remanded the case to state court, and the corporate defendants appealed.

On appeal, the corporate entities asserted three independent grounds for federal jurisdiction: (1) diversity jurisdiction existed because none of the “properly joined and served” defendants were Missouri citizens at the time of the attempted removal; (2) federal question jurisdiction because the plaintiff’s claims were preempted by a federal statute, the Public Readiness and Emergency Preparedness Act (PREP) Act; and (3) the increased federal regulation of nursing homes during the COVID-19 pandemic effectively federalized the corporate defendants and availed them of the federal officer statute set forth in 28 U.S.C § 1442(a)(1).

On the first issue – diversity jurisdiction – the Eighth Circuit rejected the corporate defendants’ attempt at “snap removal” because it was undisputed that the plaintiff and some of the named individual defendants were all Missouri citizens. The Court noted the attempt at snap removal – filing for removal before all parties are served – did not cure the underlying lack of complete diversity among the named parties. Without complete diversity, the suit could not have been brought in a federal district court and the case could not be removed based on diversity of citizenship. 

Defendants’ second argument – federal question jurisdiction – was similarly rejected by the Eighth Circuit.  It concluded the PREP Act did not completely preempt state causes of action for negligence.  The Court also addressed the defendants’ alternative argument - even if Plaintiff’s claims were not “completely preempted” by the PREP Act, the claims still “necessarily raise[d]” a federal question. The Court rejected this argument as well, noting the defendants failed to identify a federal issue that was a necessary element of the plaintiff’s state law claims and, thus, the mere assertion of PREP Act immunity did not create federal jurisdiction.

On the last issue – federal officer removal – the Court acknowledged corporate entities like the defendants played an important role during the COVID-19 pandemic, but ruled, “the federal government’s designation of a private industry as important – or even critical – was not sufficient to federalize that industry’s operations and confer federal jurisdiction.”

* Sara Rakowiecki, Law Clerk, assisted in the research and drafting of this post. Rakowiecki is a Law Clerk pending being sworn into the Missouri Bar on September 29.