Ninth Circuit Agrees COVID-19 Negligence Action Against Nursing Homes Belongs in State Court
- February 25, 2022
A panel of the Ninth Circuit ruled February 22 that a wrongful death and negligence action against a California nursing home brought by the family of a resident who died after contracting COVID-19 belonged in state court.
Affirming the decision below dismissing and remanding the action, the Ninth Circuit panel held that the Public Readiness and Emergency Preparedness Act’s (PREP Act’s) statutory scheme was not so comprehensive as to entirely supplant state law causes of action for negligence in this context.
Applying the two-part test set forth in City of Oakland v. BP PLC, 969 F.3d 895 (9th Cir. 2020), the panel concluded that Congress, in enacting the PREP Act, “did not intend to displace non-willful misconduct claims brought by plaintiffs related to the public health emergency.”
The appeals court also found the federal officer removal statute did not confer subject matter jurisdiction. The nursing home’s “status as a critical infrastructure entity did not establish that it acted as a federal officer or agency, or that it carried out a government duty,” the appeals court observed.
The Ninth Circuit’s ruling is consistent with a recent Third Circuit decision, Estate of Maglioli v. Alliance HC Holdings LLC, Nos. 20-2833 (3d Cir. Oct. 18, 2021), and nearly every federal district court to consider the removal question in similar actions.
Richard Saldana allegedly contracted and died from COVID-19 while residing at a Glenhaven Healthcare LLC nursing home. Saldana’s family sued Glenhaven in state court, alleging the nursing home failed to adequately protect him from COVID-19. The complaint asserted causes of action for elder abuse, willful misconduct, custodial negligence, and wrongful death.
Glenhaven removed the action to federal court. The district court concluded it lacked subject matter jurisdiction and remanded to state court. On appeal, a Ninth Circuit panel affirmed.
Glenhaven argued that multiple federal agencies became “hyper-involved” in nursing home operations as a result of COVID, justifying removal under the federal officer removal statute. But in the panel’s view, many of the federal agency communications cited by Glenhaven “show nothing more than regulations and recommendations” for nursing homes in dealing with COVID.
“Without more than government regulations and recommendations, Glenhaven has failed to establish that it was ‘acting under’ a federal official,” the appeals court said.
The appeals court also rejected Glenhaven’s contention that it acted on behalf of a federal official as part of the “national critical infrastructure.” The federal government’s designation of an industry as critical is not enough to federalize an entity’s operations and confer federal jurisdiction, the appeals court said.
Next, the Ninth Circuit declined to defer to the Department of Health and Human Services’ (HHS’) interpretation of the PREP Act as a complete preemption statute and instead applied the two-part test set forth in City of Oakland: (1) did Congress intend to displace a state-law cause of action and (2) did Congress provide a substitute cause of action?
Answering both questions in the negative, the appeals court said the text of the PREP Act indicated that Congress intended a federal claim under the statute only for willful misconduct, not for negligence and recklessness.
The fact that the PREP Act may preempt the Saldanas’ claim for willful misconduct was not a basis for finding complete preemption of all state law causes of action, the appeals court added.
Finally, the appeals court held there was no embedded federal question in the complaint.
Saldana v. Glenhaven Healthcare LLC, No. 20-56194 (9th Cir. Feb. 22, 2022).