ORDER DENYING WITHOUT PREJUDICE PLAINTIFF STATE OF WASHINGTON'S MOTION TO REMAND

ROBERT J. BRYAN, District Judge.

THIS MATTER comes before the Court on Plaintiff State of Washington's Motion to Remand. Dkt. 15. The Court has considered Defendant The GEO Group, Inc.'s Response, the State's Reply, the Notice of Removal, the Complaint, and the remainder of the file herein. Dkts. 1, 23, 28.

I. BACKGROUND

This case originates from a complaint first filed in Pierce County. Dkt. 7, State of Wash. v. The GEO Group, Inc., Case No. 17-2-11422-2 (Pierce Co. Superior Court, 20 Sept. 2017). GEO removed to the Western District of Washington, citing three grounds for removal: (1) the federal officer removal statute, 28 U.S.C. §1442, alleging a causal nexus between GEO's actions and the directives of a federal officer, and that GEO has a colorable preemption defense; (2) the general removal statute, 28 USC §1331, because the case "involves issues of federal law and federal interests that `aris[e] under the Constitution, laws, or treaties of the United States'"; and (3) diversity jurisdiction, 28 U.S.C. §1332(a). Dkt. 1 at 8, 9.

The issue raised by the State's motion to remand is whether this Court has subject matter jurisdiction. As discussed below, the State's motion should be denied without prejudice. The Court has subject matter jurisdiction because the case at present implicates the federal officer removal statute, §1442. Having identified a basis for its subject matter jurisdiction, the Court declines to address §1331 and §1332(a).

II. DISCUSSION

A. Standard for federal officer removal under 28 U.S.C. §1442.

The federal officer removal statute provides:

28 U.S.C. §1442 (emphasis added). "The purpose of the federal officer removal statute is to ensure a federal forum in any case where a federal official is entitled to raise a defense arising out of his duties." Goncalves By & Through Goncalves v. Rady Children's Hosp. San Diego, 865 F.3d 1237, 1243-44 (9th Cir. 2017), quoting Arizona v. Manypenny, 451 U.S. 232, 241 (1981). The party seeking removal under §1442(a)(1) bears the burden to show:

Id., quoting Durham v. Lockheed Martin Corp., 445 F.3d 1247, 1251 (9th Cir. 2006) (internal quotations and citations omitted). Section 1442 should be interpreted "broadly in favor of removal[,]" so that "the policy favoring removal [is] not []frustrated by a narrow, grudging interpretation[.]" Id. at 1244, citing Arizona, 451 U.S. at 242 (internal quotations omitted).

In this case, the parties do not dispute GEO's showing as to the first element, that GEO is a "person" as contemplated by the statute. The State challenges GEO's showing as to the second and third elements, arguing that there is no causal nexus and that GEO lacks a colorable federal defense.

B. Causal nexus.

To show a causal nexus, GEO must show that (1) a challenged act is an "action under" a federal officer, and (2) "the challenged act[] occurred because of what they were asked to do by the Government." Goncalves, 865 F.3d at 1244-45, citing to Isaacson v. Dow Chemical Co., 517 F.3d 129 (2nd Cir. 2008).

The challenged act in this case is payment to detainees at a rate of $1 per day. The State argues that this alleged act does not occur "because of" what the Government has asked of GEO, because the rate of detainee compensation is left to GEO's discretion. Dkt. 15 at 9-14; Dkt. 28 at 6-9. GEO's discretion, the State posits, is apparent from language in the ICE-GEO contract directing GEO to manage a Volunteer Work Program "developed by the contractor," where compensation is limited only by the 2011 Performance-Based National Detention Standards (PBNDS), with detainee compensation of "at least $1.00 (USD) per day." Dkt. 15 at 10-13. GEO is not precluded from compensating detainees at least the State minimum wage, the State avers. Id.

GEO takes issue with the State's interpretation of the ICE-GEO Contract and argues that ICE sets the compensation amount. Dkt. 23 at 11-16. GEO argues in the alternative that even if GEO could compensate detainees at the State minimum wage, this flexibility misses the broader point: ICE, not GEO, controls whether detainees can work competitively in the work force. Id.

The Court finds that the causal nexus is satisfied at this stage of the case, under the theory that GEO pays detainees $1 per day based on a rate compensated by the Government. Under this theory, GEO's compensation rate is an "action under" a federal officer because it is taken pursuant to the ICE-GEO Contract, and GEO compensates detainees at that rate because of GEO's contract with ICE.

GEO has made a sufficient showing of a causal nexus.

C. Colorable federal defense.

"Courts have imposed few limitations on what qualifies as a colorable federal defense." Isaacson, 517 F.3d at 138. "To be `colorable,' the defense need not be `clearly sustainable,' [because] the purpose of the statute is to secure that the validity of the defense will be tried in federal court." Id. at 139.

A reprise of the preemption discussion for purposes of this motion is unnecessary. The parties have briefed—and the Court has at length considered—the merits of GEO's preemption defense. The Court's ruling was based on GEO's Fed. R. Civ. P. 12(b)(6) motion, which challenged the sufficiency of the Complaint. See Dkt. 29 at 5-15. Further discussion of preemption may yet be raised in a different procedural context.

GEO has made a sufficient showing that its preemption defense is colorable.

The Court has subject matter jurisdiction under §1442. The State's motion to remand should be denied without prejudice.

D. Other grounds for jurisdiction.

Because the Court has subject matter jurisdiction over this matter under §1442, the Court declines to reach the issue of whether it has jurisdiction under §1331 or §1332(a).

This Order makes no finding as to how the ICE-GEO Contract should be interpreted or whether the State Minimum Wage Act should apply.

THEREFORE, The State of Washington's Motion to Remand (Dkt. 15) is DENIED WITHOUT PREJUDICE.

IT IS SO ORDERED.

The Clerk is directed to send uncertified copies of this Order to all counsel of record and to any party appearing pro se at said party's last known address.