Filed: Jan. 15, 2015
Latest Update: Mar. 02, 2020
Summary: PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 14-1180 JAMES THOMAS DEMETRES, Plaintiff - Appellant, v. EAST WEST CONSTRUCTION, INC., Defendant - Appellee. Appeal from the United States District Court for the Eastern District of Virginia, at Norfolk. Rebecca Beach Smith, Chief District Judge. (2:13-cv-00155-RBS-DEM) Argued: October 30, 2014 Decided: January 15, 2015 Before NIEMEYER and GREGORY, Circuit Judges, and DAVIS, Senior Circuit Judge. Affirmed by published opinion. J
Summary: PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 14-1180 JAMES THOMAS DEMETRES, Plaintiff - Appellant, v. EAST WEST CONSTRUCTION, INC., Defendant - Appellee. Appeal from the United States District Court for the Eastern District of Virginia, at Norfolk. Rebecca Beach Smith, Chief District Judge. (2:13-cv-00155-RBS-DEM) Argued: October 30, 2014 Decided: January 15, 2015 Before NIEMEYER and GREGORY, Circuit Judges, and DAVIS, Senior Circuit Judge. Affirmed by published opinion. Ju..
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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 14-1180
JAMES THOMAS DEMETRES,
Plaintiff - Appellant,
v.
EAST WEST CONSTRUCTION, INC.,
Defendant - Appellee.
Appeal from the United States District Court for the Eastern
District of Virginia, at Norfolk. Rebecca Beach Smith, Chief
District Judge. (2:13-cv-00155-RBS-DEM)
Argued: October 30, 2014 Decided: January 15, 2015
Before NIEMEYER and GREGORY, Circuit Judges, and DAVIS, Senior
Circuit Judge.
Affirmed by published opinion. Judge Gregory wrote the opinion,
in which Judge Niemeyer and Senior Judge Davis joined.
ARGUED: Earl Stanley Murphy, MOODY LAW FIRM, Portsmouth,
Virginia, for Appellant. Danielle D. Giroux, HARMAN, CLAYTOR,
CORRIGAN & WELLMAN, Richmond, Virginia, for Appellee. ON BRIEF:
Stanley P. Wellman, HARMAN, CLAYTOR, CORRIGAN & WELLMAN,
Richmond, Virginia, for Appellee.
GREGORY, Circuit Judge:
James Thomas Demetres (“Demetres”) appeals the district
court’s dismissal of his personal injury suit against East West
Construction, Inc. (“East West”) for lack of subject matter
jurisdiction pursuant to Federal Rule of Civil Procedure
12(b)(1). For the reasons stated herein, we affirm the judgment
of the district court.
I.
Demetres is a resident and citizen of North Carolina. His
direct employer, Ashland Construction Co. (“Ashland”), is a
North Carolina corporation. East West is a Virginia
corporation. In March of 2011, Ashland hired East West as a
subcontractor to prepare a site in Virginia Beach for
construction of a CVS Pharmacy, and designated Demetres as the
superintendent.
At the jobsite on March 28, 2011, a bulldozer, which was
operated by an employee of East West, backed over Demetres,
resulting in significant injuries and nearly killing him.
Demetres subsequently received workers’ compensation benefits
under North Carolina law through his employment with Ashland.
On March 27, 2013, Demetres filed a personal injury suit
against East West in the Eastern District of Virginia, alleging
negligence and seeking $100,000,000 in damages.
2
East West filed a motion to dismiss for lack of subject
matter jurisdiction, pursuant to Federal Rule of Civil Procedure
12(b)(1). It argued that the exclusivity provision of the
Virginia Workers’ Compensation Act (“VWCA”), Va. Code Ann.
§ 65.2-307, barred Demetres’s personal injury suit. The
district court, relying largely on our decision in Garcia v.
Pittsylvania County Service Authority, 845 F.2d 465 (4th Cir.
1988), granted East West’s motion and dismissed the suit.
Demetres timely appealed.
II.
We review a district court’s dismissal for lack of subject
matter jurisdiction under Rule 12(b)(1) de novo. 1 Evans v. B.F.
Perkins Co., 166 F.3d 642, 647 (4th Cir. 1999). The burden of
establishing subject matter jurisdiction rests with the
plaintiff.
Id. A 12(b)(1) motion should be granted if, after
engaging in any necessary fact-finding, the court determines
1
There was some discussion at oral argument and in the
district court about whether East West’s motion should be
characterized as a Rule 12(b)(6), rather than a Rule 12(b)(1),
motion. Because the outcome would be the same regardless, we
have no need to decide that issue and proceed as if East West’s
motion properly invoked Rule 12(b)(1).
3
that the movant is entitled to judgment as a matter of law. See
Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006). 2
Demetres makes two main arguments on appeal. First, he
argues that the Full Faith and Credit Clause requires Virginia
to defer to the law of North Carolina, the state that paid him
benefits, in determining whether his suit is barred. Second, he
argues that Supreme Court of Virginia precedent allows Virginia
to apply the law of the state that paid benefits, even if the
injury occurred in Virginia.
A.
Demetres argues that East West would be amenable to suit in
North Carolina and, because he accepted workers’ compensation
benefits in North Carolina through Ashland, the district court
should have applied North Carolina law to determine whether his
suit against East West should be barred. The district court
rejected this argument and, applying Virginia law, concluded
that the suit was barred.
Because this is a diversity action, the district court,
sitting in Virginia, was required to apply Virginia law. See
Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496-97
2
“[I]n some instances, if subject-matter jurisdiction turns
on contested facts, the trial judge may be authorized to review
the evidence and resolve the dispute on her own. If
satisfaction of an essential element of a claim for relief is at
issue, however, the jury is the proper trier of contested
facts.” Arbaugh, 546 U.S. at 514 (internal citations omitted).
4
(1941); see also Res. Bankshares Corp. v. St. Paul Mercury Ins.
Co., 407 F.3d 631, 635 (4th Cir. 2005). Virginia subscribes to
the lex loci delicti principle for determining the applicable
substantive law in tort suits. Jones v. R.S. Jones & Assocs.,
Inc.,
431 S.E.2d 33, 34 (Va. 1993). According to that
principle, the law of the place in which the injury occurred
governs the substantive cause of action.
Id. Because the
injury that is the basis of this suit occurred in Virginia, the
substantive law of Virginia governs.
An injured employee who is covered by the VWCA is barred
from suing his employer in tort for injuries “arising out of and
in the course of the injured employee’s employment.” See, e.g.,
Simms v. Ruby Tuesday, Inc., 704 S.E.2d 359, 362 (Va. 2011).
Section 65.2-307 of the Virginia Code provides:
The rights and remedies herein granted to an employee
when his employer and he have accepted the provisions
of this title respectively to pay and accept
compensation on account of injury or death by accident
shall exclude all other rights and remedies of such
employee, his personal representative, parents,
dependents or next of kin, at common law or otherwise,
on account of such injury, loss of service or death.
Va. Code Ann. § 65.2-307(A) (emphasis added). Section 65.2-302
defines a “statutory employer.” That section provides, in
relevant part:
When any person (referred to in this section as
“contractor”) contracts to perform or execute any work
for another person which work or undertaking is not a
part of the trade, business or occupation of such
5
other person and contracts with any other person
(referred to in this section as “subcontractor”) for
the execution or performance by or under the
subcontractor of the whole or any part of the work
undertaken by such contractor, then the contractor
shall be liable to pay to any worker employed in the
work any compensation under this title which he would
have been liable to pay if that worker had been
immediately employed by him.
Va. Code Ann. § 65.2-302(B) (emphasis added).
The Supreme Court of Virginia has interpreted the VWCA as
barring suits where, as here, injured employees of a general
contractor attempt to sue a subcontractor who was engaged in the
general contractor’s “trade, business or occupation.” See,
e.g., David White Crane Serv. v. Howell, 714 S.E.2d 572, 575
(Va. 2011) (“Because the purpose of the [VWCA] is to bring
within its operation all persons who are engaged in the trade,
business or occupation of the contractor who engages to perform
the work, all such persons are entitled to the protection
afforded by Code § 65.2-307.”); Pfeifer v. Krauss Constr. Co.,
546 S.E.2d 717, 719 (Va. 2001) (“If a particular subcontractor
and an injured employee’s common law or statutory employer are
both working on the same project and are also engaged in the
owner’s or general contractor’s work, that particular
subcontractor, as a statutory co-employee of the injured worker,
is also entitled to the common law immunity provided by the
exclusivity provision.”). Notwithstanding whatever our own view
of the statutory text may be, when interpreting state law, we
6
are obligated to defer to the state’s highest court. See, e.g.,
Assicurazioni Generali, S.p.A. v. Neil, 160 F.3d 997, 1002 (4th
Cir. 1998) (“It is axiomatic that in determining state law a
federal court must look first and foremost to the law of the
state’s highest court, giving appropriate effect to all its
implications.”). Here, East West, a construction subcontractor
preparing a worksite for Ashland, was clearly engaged in the
same “trade, business or occupation” as Ashland. East West is
therefore a statutory co-employee of Demetres under Supreme
Court of Virginia precedent. Thus, if the VWCA applies to
Demetres’s claim, his suit is barred.
Demetres, however, argues that the VWCA does not apply to
his claim, because he obtained benefits in North Carolina.
Under the workers’ compensation laws of North Carolina, Demetres
argues that East West would not be immune from suit. He further
argues that Virginia should give full faith and credit to his
right of action against East West under North Carolina law.
In Garcia v. Pittsylvania County Service Authority, a panel
of this Court held that the VWCA barred the claims of two
employees of a North Carolina subcontractor for injuries
sustained while working on a project for a Virginia general
contractor in Virginia. 845 F.2d at 468. Relying primarily on
the Supreme Court’s decision in Carroll v. Lanza,
349 U.S. 408
(1955), the panel concluded that “the law of Virginia controls
7
for [an] accident which occurred in Virginia and was occasioned
by the negligence of an independent contractor with the [general
contractor] who was doing work in Virginia and required by
Virginia law to have workers’ compensation insurance.” Garcia,
845 F.2d at 467.
The Supreme Court in Carroll held that states with more
permissive workers’ compensation laws are not required to give
full faith and credit to states whose laws are more restrictive.
349 U.S. at 413-14. There, an injured employee brought a
personal injury suit against a third party tortfeasor in
Arkansas, after collecting workers’ compensation benefits in
Missouri.
Id. at 409-10. At the time, Missouri barred suits by
injured employees against third parties, but Arkansas did not.
Id. The Supreme Court held that the Full Faith and Credit
Clause did not require Arkansas to defer to Missouri’s more
restrictive laws and bar the suit.
Id. at 413-14. The Court
reasoned that Arkansas, as the state where the injury occurred,
had “a legitimate interest in opening her courts to suits of
this nature, even though in this case Carroll’s injury may have
cast no burden on her or on her institutions.”
Id. at 413. The
Court expressly limited its holding to cases where a state seeks
to permit a cause of action that is barred by the laws of
another state. See
id. (stating that Carroll is not a case
“where the State of the forum seeks to exclude from its courts
8
actions arising under a foreign statute” and that the situation
in Carroll is “a much weaker [case] for application of the Full
Faith and Credit Clause”).
Notwithstanding the Supreme Court’s limiting language, the
Garcia panel concluded that Carroll applied to all workers’
compensation cases “involving differing state compensation
statutes.” Garcia, 845 F.2d at 466. Thus, in Garcia, Virginia
was not required to relax its more restrictive workers’
compensation bar to hear a suit permitted under the laws of
North Carolina.
Id. at 467.
The district court concluded that Garcia clearly foreclosed
Demetres’s claim. Demetres v. E.W. Constr. Co., 995 F. Supp. 2d
539, 544 (E.D. Va. 2014) (relying on Garcia to conclude that
Demetres’s “tort suit is barred [in Virginia]”). Like the
district court, we conclude that, under Garcia, Demetres’s claim
is barred by the VWCA.
Demetres, however, argues that Garcia was wrongly decided,
that this Court erred in relying on Carroll, and that it should
have applied the Full Faith and Credit balancing test applied in
Hughes v. Fetter, 341 U.S. 609 (1951). In Hughes, the Supreme
Court held that Wisconsin could not bar a wrongful death claim
arising out of Illinois law solely because the death occurred
outside of Wisconsin.
Id. at 612. The Court balanced the
policies of both Wisconsin and Illinois and, finding that
9
Wisconsin “has no real feeling of antagonism against wrongful
death suits in general,” concluded that the Full Faith and
Credit Clause required Wisconsin to open its courts to the
plaintiff’s wrongful death claim. Id.
Demetres argues that the balancing test the Supreme Court
applied in Hughes should have been applied in Garcia.
Regardless of our opinion on the validity of the Garcia panel’s
analysis, however, we are bound to follow its decision. See,
e.g., McMellon v. United States,
387 F.3d 329, 332 (4th Cir.
2004) (en banc) (stating the “basic principle that one panel
cannot overrule a decision issued by another panel”). Thus,
even if we were to agree with Demetres that the analysis in
Garcia was faulty, we are powerless as a panel to overrule it. 3
3
Demetres also argues that the 1932 Supreme Court of
Virginia case Solomon v. Call, 166 S.E. 467 (Va. 1932),
expressly allows his claim to be heard in Virginia. Solomon
held that an out-of-state employee, who was injured in Virginia
but collected workers’ compensation benefits in his home state,
may sue the third party tortfeasor responsible for his injuries
in Virginia.
Id. at 469. The Supreme Court of Virginia has
never expressly overruled Solomon. In Garcia, however, this
Court held that Solomon, to the extent that it would allow a
suit such as Demetres’s to proceed, was no longer the “present
law of Virginia on the subject.”
Garcia, 845 F.2d at 467.
Since Garcia abrogated Solomon and barred a suit that
Demetres’s counsel admitted at oral argument was factually
indistinguishable from the instant case, we have no need to
address Solomon here. Today we are bound to follow Garcia, and
under Garcia, Demetres’s suit is barred.
10
Only the full court, sitting en banc, can overrule a panel
decision. However, for the time being, we must follow the panel
decision in Garcia and hold that, because Demetres’s injury
occurred in Virginia, and East West is a statutory co-employee
under Virginia law, his personal injury action is barred by the
VWCA.
AFFIRMED
11
