DAVID HITTNER, United States District Judge.
Pending before the Court is Exxon Mobil Corporation's Motion to Remand (Document No. 6). Having considered the motion, submissions, and applicable law, the Court determines the motion should be denied.
This case arises out of a series of litigation over disputed insurance obligations to Plaintiff Exxon Mobil Corporation ("Exxon"). Savage Refinery Services, LLC ("Savage"), a non-party, contracted to provide services to Exxon (the "Savage Contract"). The Savage Contract purportedly required Savage to obtain insurance policies listing Exxon as an additional insured.
On January 12, 2013, two Savage employees, Kevin Roberts ("Roberts") and Arturo Munoz ("Munoz"), were injured while servicing Exxon's Baytown Refinery. On January 16, 2013, the first lawsuit related to the underlying incident at the Baytown Refinery was filed by Roberts,
On January 16, 2013, the Roberts Suit was filed in Texas state court. Roberts asserted claims for bum injuries arising from the January 12, 2013 Baytown Refinery incident. Exxon was the sole defendant named in the suit. Starr, National Union, and ICSOP were among the Savage liability coverage carriers on which Exxon made demands following the filing of the suit.
On January 9, 2014, ICSOP filed The Insurance Company of the State of Pennsylvania v. Exxon Mobil Corporation, Civil Action No. H-14-00053 ("ICSOP Suit") in the Southern District of Texas seeking declaratory relief as to its obligations to Exxon, Roberts, and Munoz. Roberts and Munoz were dropped from the suit when ICSOP filed its amended complaint. The case was assigned to United States District Court Judge Atlas. Exxon moved to dismiss asserting the court lacked subject matter jurisdiction. On June 18, 2014, the Court denied the motion.
On March 21, 2014, Starr filed Starr Indemnity & Liability Company v. Exxon Mobil Corporation, Civil Action No. H-14-00725 ("Starr Suit") in the Southern District of Texas seeking declaratory relief as to its obligations to Exxon. The Starr Suit was also assigned to Judge Atlas. Exxon moved to dismiss asserting the court lacked subject matter jurisdiction. On June 18, 2014, the Court denied the motion.
On March 24, 2014, Exxon moved to add ICSOP as a third-party defendant in the Roberts Suit. On March 28, 2014, Roberts and Exxon entered into a settlement agreement.
On April 23, 2014, Exxon filed the instant suit against Starr, National Union, and ICSOP in the 125th District Court of Harris County, Texas ("Instant Suit").
On May 9, 2014, Exxon moved for remand asserting a lack of subject matter jurisdiction.
On June 10, 2014, the Fifth Circuit issued Trahan v. Liberty Mutual Insurance Company, 571 Fed.Appx. 319 (5th Cir. 2014). Trahan held that a claim as to whether a workers' compensation insurance carrier waived contractual rights — such as the claim Exxon asserted against ICSOP as to subrogation — arises under Texas workers' compensation law and is not removable. Citing to Trahan, Exxon moved for reconsideration of the denial of
The Instant Suit, Starr Suit, and ICSOP Suit were all pending before Judge Atlas.
On September 23, 2014, following remand to state court, Exxon moved for summary judgment against ICSOP in the Instant Suit.
On April 15, 2015, an interlocutory order granted summary judgment against ICSOP in the Roberts Suit. The declaratory relief granted against ICSOP in the Roberts Suit was identical to the declaratory relief granted in the Instant Suit's interlocutory summary judgment.
On May 8, 2015, Exxon filed its third
On May 11, 2015, an order of final judgment was entered in the Roberts Suit as to Exxon's claims against ICSOP, which were not part of the settlement between Exxon and Roberts.
On June 4, 2015, following the May 11, 2015 entry of final judgment resolving the ICSOP claims in the Roberts Suit,
A defendant may remove a case to federal court if the federal court has subject matter jurisdiction to hear the original complaint. 28 U.S.C. § 1441(a). Federal courts have limited jurisdiction, so any doubts regarding whether federal jurisdiction is proper are resolved against federal jurisdiction. Acuna v. Brown & Root, Inc., 200 F.3d 335, 339 (5th Cir. 2000). Accordingly, the removing party bears the burden of establishing that a state court suit is removable to federal court. Carpenter v. Wichita Falls Indep. Sch. Dist., 44 F.3d 362, 365 (5th Cir.1995).
Defendants contend this case is governed by the law of the case doctrine and that Judge Atlas's previous rulings control on the issues Exxon raised in support of remand. Exxon contends law of the case doctrine is not applicable where there are no governing appellate rulings, and even if it were, application is discretionary. Law of the case doctrine "posits that when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case." Arizona v. California, 460 U.S. 605, 618, 103 S.Ct. 1382, 75 L.Ed.2d 318 (1983). The doctrine generally bars a court, when a case on remand to the district court or on a subsequent appeal, from reexamining an issue of fact or law previously decided on appeal. Lindquist v. City of Pasadena, 669 F.3d 225, 238-39 (5th Cir.2012). Law of the case doctrine is also applicable when a case is transferred so that a successor judge, while not barred from reconsidering the first judge's order, should not do so "merely because the later judge might have decided matters differently." In re Ford Motor Co., 591 F.3d 406, 411 (5th Cir. 2009).
Although this case reaches this Court following a tangled web of litigation, there has yet to be an appellate decision that would govern the case. However, there were prior rulings by a different federal district court judge when the case was removed in the first instance. As addressed below, disagreements emerged among the district courts on the issues raised — yet to be resolved by the Fifth Circuit — after the first removal's rulings and this Court finds it prudent to examine the issues raised afresh. Law of the case doctrine does not bar this Court from reaching legal conclusions independent from the prior rulings.
Exxon initially contended the jurisdictional analysis should turn on whether the principal objective of the Savage Contract was maritime in nature.
There is not a definitive line between maritime and nonmaritime contracts.
The relevant contracts for determining admiralty jurisdiction are Starr's bumbershoot policy
Maritime commerce is the touchstone of the policies at issue. Starr's bumbershoot policy provides coverage in excess of the following underlying insurance policies: (1) Marine General Liability/Terminal Operators Liability/Charterer's Legal Liability provided by National Union; (2) Savage Hull and Machinery; Protection & Indemnity provided by National Union; (3) GSS Hull and Machinery; Protection & Indemnity provided by National Union; (4) Savage Vessel Pollution provided by Great American Insurance Co; and (5) GSS Vessel Pollution provided by Water Quality Insurance Syndicate.
National Union's general marine liability policy likewise has a sufficient touchstone with maritime commerce to confer admiralty jurisdiction. The policy includes coverage for the following general liability marine hazards: (1) terminal operator operations; (2) tankermans legal liability;
Exxon contends that, even if this Court finds the policies at issue confer jurisdiction under 28 U.S.C. § 1333, removal was precluded under 28 U.S.C. § 1441 and the Savings to Suitors clause in § 1333. As the Court finds the policies confer jurisdiction here pursuant to 28 U.S.C. § 1333, these assertions are addressed in turn.
The language of 28 U.S.C. § 1441 was changed in 2011. Exxon contends the 2011 language change in 28 U.S.C. § 1441(b) is merely a clarification. Thus, the new wording does not substantively change the previous interpretation of § 1441(b), which precluded removing admiralty cases brought in state court absent a separate and independent basis for federal jurisdiction. Defendants assert § 1441(b)'s new wording allows removal of general maritime claims without an independent basis for jurisdiction.
The district courts in the Fifth Circuit split as to the effect of the 2011 change to § 1441(b). Judge Miller, of the Southern District of Texas, first addressed the new language of § 1441(b) and found that general maritime claims were now removable under a plain language analysis. See Ryan v. Hercules Offshore, Inc., 945 F.Supp.2d 772 (S.D.Tex.2013) (Miller, J.). The courts addressing the issue immediately following Ryan adopted its reasoning, including this Court. Murphy v. Seadrill Americas, Inc., Civil Action No. FI-14-1454 (S.D.Tex. Nov. 14, 2014) (Hittner, J.); see also, e.g., Wells v. Abe's Boat Rentals Inc., Civil Action No. H-13-1112, 2013 WL 3110322 (S.D.Tex. June 18, 2013) (Rosenthal, J.); Carrigan v. M/V AMC AMBASSADOR, Civil Action No. H-13-03208, 2014 WL 358353 (S.D.Tex. Jan. 31, 2014) (Werlein, J.). When this case was first removed, Judge Atlas followed Ryan in finding that the maritime claims in this case were removable. Exxon Mobil Corp. v. Starr Indem. & Liability Co., Civil Action No. H-14-1147, 2014 WL 2739309 at *2 (S.D.Tex. June 17, 2014) (Atlas, J.). However, other district courts subsequently split in interpreting the statute, with several district courts declining to follow Ryan and finding that § 1441(b) still precludes removal.
This Court finds that the plain language of the statute controls and that general maritime claims are removable under the plain language of § 1441(b). Despite Exxon's contentions, the Fifth Circuit's holding in Barker v. Hercules Offshore, Inc., 713 F.3d 208 (5th Cir.2013), does not compel this Court to reach a different conclusion.
The Fifth Circuit interpreted the pre-2011 version of § 1441 to preclude removal of admiralty claims unless an independent basis from § 1333 existed for original jurisdiction. See In re Dutile, 935 F.2d 61, 62-63 (5th Cir.1991). Admiralty claims pursuant to § 1333 do not arise under the Constitution, laws or treaties of the United States. See id. at 63 (citing Romero v. Int'l Terminal Operating Co., 358 U.S. 354, 378, 79 S.Ct. 468, 3 L.Ed.2d 368 (1959)). The pre-2011 version of 1441(a) allowed removal of any action over which a district court would have original jurisdiction "except as otherwise expressly provided by an Act of Congress." 28 U.S.C. § 1441(a) (2002). The pre-2011 version of § 1441(b) stated:
"Any civil action of which the district courts have original jurisdiction founded on a claim or right
Dutile held that § 1441(b)'s "any other such action" governed admiralty claims as those claims do not arise under the "Constitution,
Regardless of whether § 1441(b) now allows removal of admiralty cases originating in state court, Exxon contends removal is barred by the Savings to Suitors clause in 28 U.S.C. § 1333 in order to protect its right to elect a jury trial. Additionally, because admiralty cases are brought "at law" in state court, admiralty cases are exempted from § 1333's grant of original jurisdiction. Defendants assert the Savings to Suitors clause does not bar removal as it only protects the election of a common law remedy and not the right to a non-federal forum.
The invocation of the Savings to Suitors clause does not take this case outside the original jurisdiction of the federal courts under 28 U.S.C. § 1333. Section 1333 provides that: "The district courts shall have original jurisdiction, exclusive of the courts of the States, of any civil case of admiralty or maritime jurisdiction, saving to suitors in all cases all other remedies to which they are otherwise entitled." 28 U.S.C. § 1333(1). Exxon's contention rests on the statement in Barker v. Hercules Offshore, Inc. that admiralty jurisdiction is not present in a suit filed in state court because the "saving-to-suitors exception to original admiralty jurisdiction" is invoked. 713 F.3d at 222. This characterization suggests when a case is filed at law in state court the Savings to Suitors clause removes that case from the subject matter jurisdiction of the federal courts. However, the Fifth Circuit previously held that filing a suit at law in state court does not strip the federal courts of original admiralty jurisdiction if the case is subsequently removed and a party waives objecting that removal was improper pursuant to the Savings to Suitors clause. Baris v. Sulpicio Lines, Inc., 932 F.2d 1540, 1543 (1991).
Baris is instructive. In Baris, a claim under the Death on the High Seas Act ("DOHSA") was filed in state court pursuant to the Savings to Suitors clause and then subsequently removed by the defendants pursuant to 28 U.S.C. § 1333. The plaintiffs did not object to removal at that time and the district court subsequently dismissed the case. The plaintiffs then moved for a new trial and remand, asserting the district court lacked subject matter jurisdiction because the case was improperly removed under the Savings to Suitors clause. Id. The Fifth Circuit rejected the plaintiffs' argument that the district court lacked subject matter jurisdiction and held there is a difference between removal jurisdiction
Baris makes clear that the mere act of filing a case in state court pursuant to the Savings to Suitors clause does not place the case outside the Court's original admiralty jurisdiction. Subject matter jurisdiction cannot be waived. Therefore, under Baris, filing an admiralty case pursuant to the Savings to Suitors clause in state court does not transform the action in such a way as to divest the Court of the original admiralty jurisdiction it would have had if the case was initiated in federal court.
Having determined that filing a case at law in state court does not remove the case from the Court's original admiralty jurisdiction, the Court turns to whether removal here was otherwise proper; specifically, the effect of the Savings to Suitors clause in this case.
Romero held that a claim under general maritime law was not a "question of law" such that it would be subject to federal question jurisdiction under 28 U.S.C. § 1331. 358 U.S. at 359-60, 79 S.Ct. 468. In reaching that holding, the Supreme Court discussed the federalism implications if it were to hold otherwise. Id. at 371-74, 79 S.Ct. 468. The Court stated if it held such actions could be brought pursuant to § 1331 then savings clause actions would be freely removable. Id. at 371-72, 79 S.Ct. 468. This would eliminate not only the suitor's traditional choice of forum but would disturb the deeply rooted principle of concurrent jurisdiction between state and federal courts for maritime actions. Id. at 372, 79 S.Ct. 468.
The concerns articulated in Romero are not present here. Admiralty cases can only be removed if all defendants consent to the remedies sought to be preserved pursuant to the Savings to Suitors clause. Unlike Romero, where merging the admiralty claims into federal question jurisdiction would have made "considerable inroads into the traditionally exercised concurrent jurisdiction of the state courts in admiralty matters," id. here, consent to the common law remedy limits the scope of actions that can be removed. Construing admiralty claims as included in federal question jurisdiction would have eviscerated the Savings to Suitors clause because 28 U.S.C. § 1331, and not § 1333, which contains the Savings to Suitors clause, would have been the basis for removal. Here, concurrent jurisdiction is preserved in allowing removal of admiralty claims pursuant to § 1333, because the claims can only be removed if there is consent to the remedy preserved by the Savings to Suitors clause. Accordingly, concerns for the preservation of federalism do not require the Court to decline to exercise its original admiralty jurisdiction.
The Savings to Suitors clause may bar removal to federal court where the parties seeking removal do not consent to the remedy preserved by filing the action in state court. But here, Exxon only has a right to its common law remedy of a jury trial, not to have that jury trial take place in state court. See Tennessee Gas Pipeline, 87 F.3d at 153. All Defendants have consented to a jury trial. Federal Rule of Civil Procedure 39 provides a mechanism by which cases not brought at law may be tried by jury with the consent of all parties. FED. R. CIV. P. 39(c)(2). Therefore, there is a mechanism by which this Court may enforce the common law remedy sought. Accordingly, the Court finds because it has original admiralty jurisdiction and § 1441(b)'s plain language no longer bars removal, the Savings to Suitors clause in § 1333 does not require remand where all defendants have consented to a jury trial.
Exxon contends the claims against ICSOP in the Third Amended Petition arise
Jurisdictional facts are established at the time of removal and post-removal events do not affect removal jurisdiction. Louisiana v. Am. Nat. Prop. Cas. Co., 746 F.3d 633, 636 (5th Cir.2014). Pursuant to 28 U.S.C. § 1445(c), civil actions arising under a state's workers' compensations laws may not be removed from state court. 28 U.S.C. § 1445(c). Claims that a workers' compensation insurer contractually waived its rights under the Texas Labor Code arise under state workers' compensation law and are not removable. Trahan, 571 Fed.Appx. at 320-21. Texas's transactional approach to res judicata bars all suits arising out of the same subject matter of a prior suit that could have been litigated in the prior suit. Barr v. Resolution Trust Corp., 837 S.W.2d 627, 631 (Tex. 1992). The transactional approach bars suit not only on matters actually litigated, but "also on causes of action or defenses which arise out of the same subject matter and which might have been litigated in the first suit." Getty Oil Co. v. Ins. Co. of N. Am., 845 S.W.2d 794, 798 (Tex.1992). "[I]f a plaintiff prevails in a lawsuit, his cause of action merges into the [judgment] and the cause of action dissolves." Jeanes v. Henderson, 688 S.W.2d 100, 103 (Tex. 1985). "[A] trial court's judgment is final for purposes of res judicata ... even when the case is on appeal." Gonzales v. Guilbot, 315 S.W.3d 533, 536 n. 3 (Tex.2010).
Judge Atlas remanded the Instant Suit — after initially denying a motion to remand — because following Trahan, the claims asserted against ICSOP now were classified as claims arising under Texas workers' compensation law. The claim arising under workers' compensation law against ICSOP in the Third Amended Petition, which is the controlling pleading for removal purposes, is for breach of contract for failing to acknowledge subrogation rights. The Third Amended Petition also asserts for the first time a conspiracy claim against National Union and ICSOP pertaining to interference with Exxon's subrogation rights.
Exxon sought declaratory relief that ICSOP waived its subrogation rights in both the Instant Suit and the Roberts suit. Exxon moved for summary judgment against ICSOP in both actions. On April 2, 2015, prior to removal, interlocutory summary judgment was granted in the Instant Suit and then in the Roberts Suit on April 15, 2015. On May 11, 2015, a final judgment was issued in the Robert's
Exxon made a decision to seek nearly identical declaratory relief against ICSOP in both the Instant Suit and the Roberts Suit. Interlocutory summary judgment for Exxon was granted in both. However, upon the Roberts Suit final judgment issuance any claims against ICSOP in the Instant Suit, which were not yet subject to a final judgment, were merged into the Roberts Suit final judgment and dissolved. Any additional claims that Exxon asserts against ICSOP in the Third Amended Petition pertaining to the waiver of subrogation are barred by Texas's transactional approach because the claims could have been brought in the Roberts Suit. Therefore, res judicata attaches to the final judgment in the Roberts Suit and serves as a bar to the claims asserted against ICSOP here.
The sole basis for remand of the Instant Suit after its initial removal was the presence of the claims against ICSOP, which arose under workers' compensation law and barred removal. Those claims are no longer a bar to removal. The fact that the Roberts Suit final judgment is currently on appeal does not alter that analysis. A trial court's decision is considered final for res judicata purposes even if on appeal.
Nor does the presence of any conspiracy claim asserted in the Third Amended Petition against National Union and ICSOP require remand here.
Exxon asserts removal was not timely because it was not within thirty days of the interlocutory summary judgment in the Instant Suit. Defendants contend the Instant Suit was not removable until the final judgment in the Roberts Suit extinguished all the claims against ICSOP. Exxon also contends that, even if removal were otherwise timely, a court decision in a separate case does not make the Instant Suit removable pursuant to 28 U.S.C. § 1446(b). Defendants contend under Fifth Circuit precedent, a decision in a separate state case involving the same defendants and claims allows removal pursuant to 28 U.S.C. § 1446(b).
Pursuant to 28 U.S.C. § 1446(b), if a case is not initially removable, notice of removal must be filed within thirty days of a "motion, order or other paper from which it may first be ascertained that the case is or has become removable." 28 U.S.C. § 1446(b)(3). Decisions in an unrelated case generally do not qualify as "orders" or "other papers." Green v. R.J. Reynolds Tobacco Co., 274 F.3d 263, 266-67 (5th Cir.2001). A decision in an unrelated case qualifies as an "order" only if it "[involves] the same defendants, and a similar factual situation and legal issue." Id. at 268. The order need not explicitly discuss removal if it has the effect of making the case removable. See id. (holding an order in different case, involving the same defendants deciding the defendants could not legally be sued under that provision of law, made the case at bar in Green removable).
Whether a final judgment in a separate case that triggers res judicata — involving the same defendant, same plaintiff, and same set of facts as the instant case — is an "order" under § 1446(b) is a matter of first impression in this Circuit. Although Green involved a matter of legal interpretation that made the case removable, as opposed to the issuance of a judgment that triggered res judicata in the Instant Suit, the effect of the order in the separate suit is the same. In Green, a decision in a separate suit found that the claims against the same defendants whose joinder precluded removal in the Green suit were not cognizable under Texas law. Id. at 265-66. This made the Green suit removable because the non-removable defendants were in effect dissolved from the suit. Id. at 265-66, 268. Here, it was only the presence of the claims arising under workers' compensation law against ICSOP that precluded removal of the Instant Suit. Upon issuance of the Roberts Suit final judgment, res judicata attached and all of Exxon's claims against ICSOP related to this transaction were merged into that judgment and dissolved from the Instant Suit. Thus, the effect of the Roberts Suit final judgment is the same as the separate decision in Green — dissolving the non-removable defendant — and brings the Instant Suit within the scope of Green's narrow holding. Accordingly, pursuant to Green, the Court finds the Roberts Suit final judgment was an "order" within the meaning of 28 U.S.C. § 1446(b)(3) making the Instant Suit removable.
Having determined the Roberts Suit final judgment is an "order" allowing removal, the Court turns to whether the Roberts Suit final judgment is in fact the date from which the thirty-day removal period under 28 U.S.C. § 1446(b) began to run. Removal must occur within thirty days of a non-removable case becoming removable. 28 U.S.C. § 1446(b)(3). A judgment is only final if it disposes of all "all parties and all claims." Ford v. Exxon Mobil Chem. Co., 235 S.W.3d 615, 617 (Tex.2007) (discussing that a summary judgment would be interlocutory unless it also addressed fees claims). Res judicata requires a final judgment to attach. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652 (Tex.1996). An interlocutory summary judgment does not support a plea of res judicata. Mower v. Boyer, 811 S.W.2d 560, 562 (Tex.1991).
On April 2, 2015, interlocutory summary judgment was granted in the Instant Suit as to the declaratory judgment relief sought against ICSOP. The interlocutory judgment did not dispose of the claim against ICSOP for attorney's fees, which was predicated on the claims arising under workers compensation law. Not only was the Instant Suit interlocutory judgment not final for res judicata purposes, but it also did not dispose of all the claims against ICSOP that barred removal. Thus, it was not an order from which the Defendants could have ascertained removability.
Similarly, the April 15, 2015 Roberts Suit interlocutory summary judgment only granted declaratory relief and did not address attorneys' fees. It was only upon issuance of the May 11, 2015 Roberts Suit final judgment as to the declaratory relief against ICSOP that res judicata could attach. At that time all claims against ICSOP arising from that transaction were merged into the Roberts Suit final judgment and dissolved from the Instant Suit. Therefore, Defendants could not have ascertained removability until May 11, 2015. Starr filed its notice of removal on June 4, 2011. This was within thirty days of the May 11, 2015 Roberts Suit final judgment. Accordingly, the Court finds that removal was timely.
Based on the foregoing, the Court hereby
The pre-2011 version of § 1441 reads, in relevant part:
