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Friedenberg v. Lane County

United States District Court, D. Oregon

May 23, 2018

SAM FRIEDENBERG, personal representative of the estate of MARC SANFORD; DEREK LARWICK, personal representative of the estate of RICHARD BATES; and LORRE SANFORD, an individual, Plaintiffs,
v.
LANE COUNTY, LANE COUNTY MENTAL HEALTH aka LANE COUNTY BEHAVIORAL HEALTH; CARLA AYRES, ERIK MORRIS; FRANCES FREUND; and JULIE RIUTZEL, Defendants.

          ORDER

          JOLIE A. RUSSO UNITED STATES MAGISTRATE JUDGE

         Plaintiffs move the Court to remand this case to state court asserting lack of jurisdiction. Pls.' Mot. to Remand 1 (doc. 9). Oral argument was held on April 25, 2018. For the reasons set forth below, plaintiffs' motion is DENIED.

         BACKGROUND

         After a criminal conviction in Oregon state court, Michael Bryant (“Bryant”) was referred to a Jail Diversion Program administered by Lane County Mental Health (“LCMH”) as a term of his probation. During his time at LCMH, Bryant was under the care of the individual defendants. Subsequent to Bryant's release, he committed three homicides and injured two other individuals. Plaintiffs here are one of the injured persons and personal representatives for two of the decedents.

         Defendants assert LCMH's employees are “deemed” Public Health Service (“PHS”) employees based on documentation provided to them by the Secretary of the United States Department of Health and Human Services (“HHS”). Defs.' Notice of Removal, Ex. D at 4 (notice of deeming action for 2015) (doc. 1). Defendants contend this designation affords LCMH employees the same immunity afforded to PHS employees pursuant to the Federally Supported Health Centers Assistance Act (“FSHCAA”). See 42 U.S.C. § 233.

         On November 13, 2017, plaintiffs filed this action in Oregon state court serving notice to Lane County and the United States Attorney's Office for the District of Oregon. Defs.' Notice of Removal, Ex. A (doc. 1); Pls.' Mot. to Remand, Ex. A at 21 (doc. 9).[1] Between November 2017 and January 2018, defendants corresponded with the HHS Office of General Counsel regarding plaintiffs' state court claim. See generally, Defs.' Notice of Removal, Exs. F-I (doc. 1). After requesting documents related to Bryant's court mandated probation orders, HHS sent emails advising defendants: (1) their claims were “not covered” pursuant to the Federal Tort Claims Act (“FTCA”) and FSHCAA; (2) defendants should “take whatever action necessary to protect the interest of [their] client;” and (3) “[t]here [was] no procedure within the agency to appeal a denial of coverage.” Defs.' Notice of Removal, Exs. H-I (doc. 1).

         On January 10, 2018, defendants' filed an answer to plaintiffs' amended complaint in Oregon state court. Defs.' Notice to Removal, Ex. C (doc. 1). On January 29, 2018, defendants filed a notice of removal to federal court. Defs.' Notice of Removal (doc. 1). On February 28, 2018, plaintiffs filed a motion to remand this action to Oregon state court. Pls.' Mot. for Remand (doc. 9). Prior to oral argument on the pending motion, the United States requested leave to file a statement of interest, which the Court permitted; however, the United States ultimately declined to participate in oral argument citing time constraints. See generally, Minute Order (doc. 17).

         STANDARD OF REVIEW

         A defendant may remove an action filed in state court to federal court if there is diversity or federal question jurisdiction. 28 U.S.C. §§ 1441(a), 1441(b). Upon a motion to remand, a federal court may remand a case to state court for lack of subject matter jurisdiction at any time before the court issues a final judgment. 28 U.S.C. § 1447(c). The party opposing the motion for remand has the burden of establishing federal jurisdiction. See Moore-Thomas v. Alaska Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 2009).

         DISCUSSION

         Plaintiffs broadly assert the Court lacks jurisdiction to resolve this case because the claims at issue are “purely based on state common law negligence and there is no diversity between the parties.” Pls.' Mot. for Remand 2-3 (doc. 9). Essentially, plaintiffs argue this Court lacks subject matter jurisdiction; and that 42 U.S.C. § 233(a) does not apply in this case. Id.[2]

         I. Statutory Framework

         Pursuant to the Public Health Service Act, the exclusive remedy against PHS employees acting within the scope of their employment is a tort action against the United States under the FTCA. See generally, 42 U.S.C. § 233. To effectuate this provision, Congress provided that “[u]pon a certification by the Attorney General that the defendant was acting in the scope of his employment at the time of the incident out of which the suit arose, any such civil action . . . commenced in a State court shall be removed . . . at any time before trial by the Attorney General . . . and the proceeding deemed a tort action brought against the United States.” Id. § 233(c). Specifically, the FSHCAA “created a process by which ‘public and nonprofit private entities' receiving federal funds pursuant to 42 U.S.C. § 254b(c)(1)(A) and [the] health practitioners that such entities employ ‘shall be deemed to be [employees] of the Public Health Service.' 42 U.S.C. § 233(g)(1)(A).” Lomando v. United States, 667 F.3d 363, 371 (3d Cir. 2011); see also Estrella v. Yahav, 2016 WL 1230555, at *3 (D.N.J. Mar. 29, 2016).

         The FSHCAA extends protection to “employees” of public or nonprofit private entities that receive certain federal health funds, submit an annual application to HHS, meet certain criteria, and obtain annual approval by the Secretary of HHS. See 42 U.S.C. § 233(g), (h). Upon approval of the required application, the Secretary of HHS “deems” these entities ...


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