CONSOLIDATED ORDER REMANDING ACTIONS TO THE FIRST CIRCUIT COURT OF THE STATE OF HAWAII

J. MICHAEL SEABRIGHT, District Judge.

I. INTRODUCTION

This consolidated Order rules on Motions to Remand filed by Plaintiffs in four related actions removed to this court by Defendant VSE Corporation ("VSE"): Cabalce, et al. v. VSE Corp., et al., Civ. No. 12-00373 JMS-RLP ("Cabalce"); Kelii, et al. v. VSE Corp., et al., Civ. No. 12-00376 JMS-RLP ("Kelii"); Freeman, et al. v. VSE Corp., et al., Civ. No. 12-00377 JMS-RLP ("Freeman/Sprankle"); and Irvine, et al. v. VSE Corp., et al., Civ. No. 12-00391 JMS-RLP ("Irvine"). The cases are not consolidated, but instead were assigned to a single judge as related cases under Local Rule 40.2. Because most of the relevant pleadings and arguments are identical, it is appropriate to issue this consolidated Order in each action. Based on the following, the Motions are GRANTED, and all four actions are remanded to the First Circuit Court of the State of Hawaii ("State Court").

II. BACKGROUND

A. Factual Background and the November 29, 2012 Order

On November 29, 2012, this court issued an Order Granting (1) Third-Party Defendant United States' Motions to Dismiss, and (2) Plaintiffs' Motions to Strike Third-Party Complaints ("Nov. 29, 2012 Order"). Doc. No. 88 (Cabalce),1 Cabalce v. VSE Corp., 914 F.Supp.2d 1145, 2012 WL 5996548 (D.Haw. Nov. 29, 2012). The Nov. 29, 2012 Order extensively set forth the factual background of these actions, which arose from an April 8, 2011 fire and explosion in which Donaldson Enterprises, Inc. ("Donaldson") employees Bryan Cabalce, Justin Kelii, Robert Freeman, Neil Sprankle, and Robert Leahey were killed while working and handling a large cache of government-seized fireworks in or near a storage facility. Because the parties are well aware of the background as detailed in the Nov. 29, 2012 Order, the court does not repeat those facts here. Nevertheless, many of the rulings the court made in determining whether to dismiss the Third-Party Complaints against the United States are important — indeed, dispositive — in analyzing whether these actions should be remanded to State Court for lack of federal subject matter jurisdiction.2 The court thus begins by summarizing relevant rulings made in the Nov. 29, 2012 Order.

The Nov. 29, 2012 Order dismissed VSE's Third-Party Complaints against the United States for lack of subject matter jurisdiction — the United States cannot be liable under the Federal Tort Claims Act ("FTCA"), 28 U.S.C. § 1346(b) et seq., for contribution or indemnity under the theories pled by Plaintiffs against VSE (and the other Defendants) in the Complaints, and as asserted by VSE against the United States in its Third-Party Complaints. That is, under Federal Rule of Civil Procedure 14(a)(1), the United States cannot be liable to VSE "for all or part of the claim against" VSE. Doc. No. 88, Nov. 29, 2012 Order, 914 F.Supp.2d at 1158, 2012 WL 5996548 at *9. This conclusion was based on several rulings regarding the nature of the contractual relationship between VSE, its subcontractor Donaldson, and the Treasury Executive Office for Asset Forfeiture ("the government" or "the United States").

First, this court ruled that VSE was an "independent contractor" for purposes of the FTCA. "Under the `independent contractor' exception [to the FTCA], the United States cannot be liable for a contractor's acts unless it exercises `federal authority to control and supervise the "detailed physical performance" and "day to day operations" of the contractor.'" Id. at 1159, 2012 WL 5996548 at *10 (quoting Autery v. United States, 424 F.3d 944, 956 (9th Cir.2005)). This court reasoned:

Id. at 1161, 2012 WL 5996548 at *11. This court further explained:

Id. at 1161, 2012 WL 5996548 at *11. That is, VSE was not an agent of the United States, and thus the United States could not be vicariously liable for any negligence on the part of VSE. As a result, the Third-Party Complaints failed unless the United States could be found liable for its own alleged acts. Id.

Next, as to that question of potential government liability under the FTCA for its own acts, this court ruled that the United States was protected by the FTCA's discretionary function exemption, 28 U.S.C. § 2680(a). Specifically, the government's economic and policy-based decisions regarding consigning the fireworks, and contracting for their destruction (after retaining samples as evidence for use in prosecution), were purely discretionary. Id. at 1163, 2012 WL 5996548 at *13. This is because

Id. And as for the claim that the United States breached a duty to warn or supervise, such acts likewise involved discretionary, policy-based, decisions. The Nov. 29, 2012 Order reasoned:

Id. at 1164-65, 2012 WL 5996548 at *14. In this regard, it is important that

Id. at 1165, 2012 WL 5996548 at *15.

Finally, as to claims based on a "non-delegable" duty under Hawaii law — claims that the government improperly managed inherently dangerous fireworks or wrongfully supervised its contract with VSE — this court also determined that such decisions were discretionary. Id. at 1166, 2012 WL 5996548 at *16. Moreover, such strict liability theories under state law are inconsistent with the FTCA's waiver of sovereign immunity, which is limited to claims of negligence by government employees. Id. at 1166, 2012 WL 5996548 at *16 ("Such a state-law duty, however, cannot constitute a mandatory `regulation, statute, or policy' that removes discretion from the analysis."); see also, e.g., Laird v. Nelms, 406 U.S. 797, 802-03, 92 S.Ct. 1899, 32 L.Ed.2d 499 (1972) ("[T]he Federal Tort Claims Act did not authorize suit against the Government on claims based on strict liability for ultrahazardous activity.") (citation omitted). This court reasoned that:

Nov. 29, 2012 Order, 914 F.Supp.2d at 1166, 2012 WL 5996548 at *16. Absent any federal requirement, the government's economic and policy-based acts were discretionary, and state law non-delegable duty concepts cannot abrogate this federal exemption from the FTCA's waiver of sovereign immunity. Id. at 1167, 2012 WL 5996548 at *17. This court reiterated that:

Id. at 1168, 2012 WL 5996548 at *18 (noting evidence indicating that supervisorial responsibilities were delegated to VSE).

B. Procedural Background

On May 24, 2012, these actions were filed in State Court asserting state-law claims against VSE and other Defendants for negligence, wrongful death, ultrahazardous activity, and premises liability, based on the deaths of the Donaldson employees in the April 8, 2011 incident. Id. at 1154, 2012 WL 5996548 at *5. VSE removed the actions on June 29, 2012 (Cabalce), July 2, 2012 (Kelii and Freeman/Sprankle), and July 12, 2012 (Irvine), and filed Third-Party Complaints against the United States and Donaldson. Id., 914 F.Supp.2d at 1155-56, 2012 WL 5996548 at *6.

Plaintiffs filed Motions to Remand on July 25, 2012 (Cabalce), July 31, 2012 (Freeman/Sprankle), August 1, 2012 (Kelii), and August 3, 2012 (Irvine). A hearing on the Motions was continued until December 17, 2012, to allow the court to first resolve whether subject matter jurisdiction existed over the United States as alleged in the Third-Party Complaints. Doc. No. 49. VSE filed a consolidated Opposition to the Motions to Remand on November 26, 2012. Doc. No. 83.

On November 29, 2012, the court dismissed the Third-Party Complaints against the United States for lack of jurisdiction. Plaintiffs then filed individual Replies as to the Motions to Remand on December 3, 2012. Doc. Nos. 91 (Cabalce); 71 (Kelii); 83 (Freeman/Sprankle); & 73 (Irvine). The Motions were heard on December 17, 2012. At the hearing, the court requested supplemental briefing on the jurisdictional issues. On January 5, 2013, VSE filed a Notice indicating it was no longer basing subject matter jurisdiction on 28 U.S.C. § 1332. See Doc. No. 98 (Cabalce) (stating that VSE "withdraws" without prejudice VSE's notice of removal "to the extent such notice relies on 28 U.S.C. § 1332"). On January 7, 2013, VSE filed a Supplemental Memorandum, and Plaintiffs filed a Joint Supplemental Brief. Doc. No. 100, Doc. No. 80 (Kelii).

III. STANDARD OF REVIEW

Under 28 U.S.C. § 1447(c), a party may bring a motion to remand an action removed from state to federal court. Ordinarily, "[r]emoval statutes are to be strictly construed, and any doubts as to the right of removal must be resolved in favor of remanding to state court." Durham v. Lockheed Martin Corp., 445 F.3d 1247, 1252 (9th Cir.2006). But where, as here, removal is based on 28 U.S.C. § 1442(a)(1), the Supreme Court has mandated that § 1442(a)(1) be "liberally construed to give full effect to the purposes for which [it was] enacted." Id. (quoting Colorado v. Symes, 286 U.S. 510, 517, 52 S.Ct. 635, 76 L.Ed. 1253 (1932)). Thus, "when federal officers and their agents are seeking a federal forum, [courts] are to interpret section 1442 broadly in favor of removal." Id. Likewise, unlike with other removal statutes, under § 1442 not all defendants need join in a notice of removal. See Ely Valley Mines, Inc. v. Hartford Accident & Indem. Co., 644 F.2d 1310, 1315 (9th Cir.1981) ("[Section] 1442 represents an exception to the general rule (under §§ 1441 and 1446) that all defendants must join in the removal petition."). That is, one defendant in a multi-defendant case can unilaterally remove the entire action if it meets the requirements of § 1442. See id.3

IV. DISCUSSION

In its Notices of Removal, VSE cites three grounds for removing these actions. First, although several Defendants have Hawaii citizenship (and all Plaintiffs are Hawaii residents), VSE asserted complete diversity of citizenship under 28 U.S.C. § 1332 as a basis for removal, contending that the citizenship of those Defendants should be disregarded as having been "fraudulently joined" for purposes of destroying diversity. See Doc. No. 1, Notice of Removal ¶ 7 (citing Emrich v. Touche Ross & Co., 846 F.2d 1190 (9th Cir.1988)). As set forth above, VSE has since withdrawn that basis for removal, indicating it no longer contests that the parties are non-diverse for purposes of § 1332. Doc. No. 98 (Cabalce).

Thus, VSE now relies on its other two grounds for removal — two different federal defenses: (1) a "government contractor defense" under Boyle v. United Technologies Corp., 487 U.S. 500, 511-12, 108 S.Ct. 2510, 101 L.Ed.2d 442 (1988), Doc. No. 1, Notice of Removal ¶ 50, and (2) "derivative sovereign immunity ... as to Plaintiffs' claims based on strict liability," id. ¶ 46, applying a doctrine derived from Yearsley v. W.A. Ross Construction Co., 309 U.S. 18, 60 S.Ct. 413, 84 L.Ed. 554 (1940). It asserts those defenses under 28 U.S.C. § 1442(a)(1), the Federal Officer Removal Statute. Doc. No. 1, Notice of Removal ¶¶ 14-50. Section 1442(a)(1) provides, in pertinent part, that a civil action commenced in state court is removable when "any officer (or any person acting under that officer) of the United States or of any agency thereof, [is sued for] any act under color of such office." (Emphasis added).

A. The Framework for Analyzing VSE's Remaining Basis for Removal — 28 U.S.C. § 1442(a)(1)

Before proceeding to address § 1442(a)(1), the court explains the framework it applies in analyzing VSE's arguments. Under Ninth Circuit caselaw, "a party seeking removal under section 1442 must demonstrate that (a) it is a `person' within the meaning of the statute; (b) there is a causal nexus between its actions, taken pursuant to a federal officer's directions, and plaintiff's claims; and (c) it can assert a `colorable federal defense.'" Durham, 445 F.3d at 1251 (citing Jefferson Cnty. v. Acker, 527 U.S. 423, 431, 119 S.Ct. 2069, 144 L.Ed.2d 408 (1999), and Mesa v. California, 489 U.S. 121, 124-25, 109 S.Ct. 959, 103 L.Ed.2d 99 (1989)). Under this statute, "suits against federal officers may be removed despite the nonfederal cast of the complaint; the federal-question element is met if the defense depends on federal law." Acker, 527 U.S. at 431, 119 S.Ct. 2069.

But the court does not simply apply the prongs of Durham's three-part test mechanically and in isolation. Other Circuits phrase the analysis differently, although articulating the same basic rationale. For instance, they focus not necessarily on whether a "causal nexus" exists, but on whether a contractor is "acting under" a federal agent or acting "under color of" a federal office. As an example, the Eighth Circuit recently stated:

Jacks v. Meridian Res. Co., 701 F.3d 1224, 1230 (8th Cir.2012). Jacks explained that

Id. (quoting Watson v. Philip Morris Cos., 551 U.S. 142, 152, 127 S.Ct. 2301, 168 L.Ed.2d 42 (2007)).

In Bennett v. MIS Corporation, 607 F.3d 1076 (6th Cir.2010) (en banc), the Sixth Circuit set forth this three-pronged test:

Id. at 1085 (citing § 1442(a)(1)) (editorial marks omitted). And the Second Circuit, adopting a test similar to Bennett, observed that the second prong ("under color of federal office") "has come to be known as the causation requirement." Isaacson v. Dow Chem. Co., 517 F.3d 129, 137 (2d Cir.2008). It describes "[t]he hurdle erected by this [causation] requirement as quite low," meaning that a contractor "must demonstrate that the acts for which they are being sued ... occurred because of what they were asked to do by the Government." Id. And as for the "acting under" prong, Isaacson adds that "there must be a `special relationship' between" the contractor and a federal officer, such as "close supervision of the private entity by the Government." Id. (citing Watson, 551 U.S. at 157, 127 S.Ct. 2301).

It is thus apparent that Durham simply sets forth a basic framework of factors a court considers in determining — under any possible factual scenario — whether any "officer (or any person acting under that officer) of the United States or of any agency thereof" may invoke federal jurisdiction to have a "colorable federal defense" litigated in a federal forum. See, e.g., Mesa, 489 U.S. at 133, 109 S.Ct. 959 (recounting the history and purposes of § 1442(a)(1)). That is, the factors do not apply with mathematical precision, and they may not all apply in every case context matters.

The court therefore begins with the essential § 1442(a)(1) requirement — however articulated — that there be a "causal nexus" between VSE's alleged actions "taken pursuant to a federal officer's directions, and [Plaintiffs'] claims." Durham, 445 F.3d at 1251. And, even though the court ultimately finds no such nexus in this case (and thus might well end the inquiry at that point), mindful that various courts emphasize different terms, the court proceeds to the next step. That is, the court then analyzes both proffered federal defenses — "government contractor" under Boyle, and "derivative sovereign immunity" under Yearsley — in turn.

B. The Elements of Removal Under § 1442(a)(1)

1. "Causal Nexus"4

The right of removal under § 1442(a)(1) may extend to private "persons" who are "acting under" a federal officer or agency. The actor "must both raise a colorable federal defense, and establish that the suit is `for a[n] act under color of office.' To satisfy the latter requirement, the officer must show a nexus, a `causal connection' between the charged conduct and asserted official authority." Acker, 527 U.S. at 431, 119 S.Ct. 2069 (quoting Willingham v. Morgan, 395 U.S. 402, 409, 89 S.Ct. 1813, 23 L.Ed.2d 396 (1969) (some emphasis added)). The removing defendant must "by direct averment exclude the possibility that [the state action] was based on acts or conduct of his not justified by his federal duty." Mesa, 489 U.S. at 132, 109 S.Ct. 959.

The "causal nexus" between a federal officer's directions and the private actor "must be predicated on a showing that the acts forming the basis of the state suit were performed pursuant to an officer's `direct orders or comprehensive and detailed regulations.'" Freiberg v. Swinerton & Walberg Prop. Servs., 245 F.Supp.2d 1144, 1152 (D.Colo.2002) (quoting Ryan v. Dow Chem. Co., 781 F.Supp. 934, 947 (E.D.N.Y.1992)). "It is not enough to prove only that `the relevant acts occurred under the general auspices of a federal office or officer.'" Id. "The official must have direct and detailed control over the defendant." Id. (citing Good v. Armstrong World Indus., 914 F.Supp. 1125, 1128 (E.D.Pa.1996) ("Removal must be predicated upon a showing that the acts forming the basis of the state suit were performed pursuant to an officer's direct orders or comprehensive and detailed regulations.")).

These are well-accepted factors for analyzing the meaning of "causal nexus" in this context. See, e.g., Arness v. Boeing N. Am., Inc., 997 F.Supp. 1268, 1273 (C.D.Cal.1998) ("Most courts have held that the federal officer must have `direct and detailed control' over the defendant.... [I]f the corporation establishes only that the relevant acts occurred under the general auspices of federal direction then it is not entitled to § 1442(a)(1) removal."); see also Thompson v. Crane Co., 2012 WL 1344453, at *27 (D.Haw. Apr. 17, 2012) (quoting Hagen v. Benjamin Foster Co., 739 F.Supp.2d 770, 784-85 (E.D.Pa. 2010), for the same factors).

Applying the factors, VSE cannot meet this "causal nexus" prong. The court has already concluded as a matter of law that VSE was acting independently — it was an "independent contractor" for purposes of the FTCA, operating without day-to-day control or supervision by the government of the means and methods of destruction of the fireworks. Doc. No. 88, Nov. 29, 2012 Order, 914 F.Supp.2d at 1161, 2012 WL 5996548 at *11. To repeat, "[n]o one disputes that Donaldson and VSE devised and prepared the destruction plans (both the plan that [the government] approved on April 28, 2010, and the modified procedure discussed between Donaldson and VSE on March 28, 2011)." Id. "At most, employees of [the government] issued disposition instructions, ordered fireworks to be destroyed, and approved a destruction plan pursuant to retained authority under the prime contract." Id. at 1161, 2012 WL 5996548 at *11. As quoted above,

Id. at 1164, 2012 WL 5996548 at *14. Thus, VSE and Donaldson were not acting under "direct orders or comprehensive and detailed regulations" of the government. Freiberg, 245 F.Supp.2d at 1152. The government did not have "direct and detailed control" over VSE or Donaldson. Good, 914 F.Supp. at 1128. At most, VSE can "establish[] only that the relevant acts occurred under the general auspices of federal direction." Arness, 997 F.Supp. at 1273. As an independent contractor, VSE cannot "exclude the possibility that the [removed action] was based on acts or conduct of [VSE] not justified by [VSE's] federal duty." Mesa, 489 U.S. at 132, 109 S.Ct. 959. In short, VSE was not "acting under" a government officer or agency, and there is no "causal nexus."

2. Colorable Federal Defenses

At the next step, VSE asserts two distinct federal defenses under § 1442(a)(1) — (1) a government contractor defense derived from Boyle, and (2) derivative sovereign immunity that many courts indicate derived from Yearsley, and cases interpreting Yearsley. This has become a complex area of law. Specifically, it is unclear whether a "derivative sovereign immunity defense" (or a "shared immunity defense") derived from Yearsley is truly distinct from a "government contractor defense" derived from Boyle. Compare In re KBR, Inc., 736 F.Supp.2d 954, 965 (D.Md.2010) ("Clearly, the Supreme Court viewed the concept of derivative sovereign immunity, at least as it derives from the immunity of federal officials, as separate and distinct from the preemption-based government contractor defense recognized in Boyle."), with Bixby v. KBR, Inc., 748 F.Supp.2d 1224, 1240 (D.Or.2010) ("Under the so-called `government contractor defense,' where certain conditions are met[,] a government contractor enjoys derivative sovereign immunity against tort actions arising out of the contractor's provision of services to the government.").5 Construing VSE's Notices of Removal based on § 1442(a)(1) "liberally" and "broadly in favor of removal," Durham, 445 F.3d at 1252, the court proceeds to analyze both.

a. Government contractor defense under Boyle

Leite v. Crane Company, 868 F.Supp.2d 1023 (D.Haw.2012), analyzed at length the government contractor defense as derived from Boyle. "The government contractor defense `protects contractors from tort liability that arises as a result of the contractor's `compli[ance] with the specifications of a federal government contract.'" Id. at 1029 (quoting Getz v. Boeing Co., 654 F.3d 852, 860 (9th Cir. 2011)). "This defense `displaces state law only when the Government, making a discretionary, safety-related military procurement decision contrary to the requirements of state law, incorporates this decision into a military contractor's contractual obligations, thereby limiting the contractor's ability to accommodate safety in a different fashion.'" Id. (quoting In re Haw. Fed. Asbestos Cases, 960 F.2d 806, 813 (9th Cir.1992)). Under Boyle, "a contractor establishes this defense where: `(1) the United States approved reasonably precise specifications; (2) the equipment conformed to those specifications; and (3) the supplier warned the United States about the dangers in the use of the equipment that were known to the supplier but not to the United States.'" Id. (quoting Boyle, 487 U.S. at 512, 108 S.Ct. 2510).

Initially, Plaintiffs argue that a government contractor defense is "only available to contractors who design and manufacture military equipment." See, e.g., Doc. No. 19-1 (Kelii), Mot. at 19 (quoting Snell v. Bell Helicopter Textron, Inc., 107 F.3d 744, 746 n. 1 (9th Cir.1997)). Nevertheless, there is a significant split in authority on this question. See Bennett, 607 F.3d at 1089 ("[T]he application of the government contractor defense has found support in the non-military context, as well as in the performance contract context.") (citing Hudgens v. Bell Helicopters/Textron, 328 F.3d 1329, 1333-34 (11th Cir.2003) (finding the defense applicable where a private service contractor faced a negligent-maintenance contract lawsuit), and Carley v. Wheeled Coach, 991 F.2d 1117, 1123 (3d Cir.1993) (applying the defense to non-military contractors)). See also Boruski v. United States, 803 F.2d 1421, 1430 (7th Cir.1986) (citing with approval the Eleventh Circuit's rationale that "[b]oth the history of the defense and its general rationale lead us to the conclusion that it would be illogical to limit the availability of the defense solely to `military' contractors"). Moreover, as noted above, the Ninth Circuit has recognized that Boyle is related to, if not derived from, Yearsley — and Yearsley did not arise from a military contract. See In re Hanford Nuclear Reservation Litig., 534 F.3d 986, 1001 (9th Cir.2008).

But, even if this government contractor defense can apply in this civilian services context, it nevertheless fails here. For the defense to apply in this duty to warn context,

Leite, 868 F.Supp.2d at 1029 (quoting Getz, 654 F.3d at 866). Here (as with the "causal nexus" prong analyzed above) it is dispositive that the court has already determined that there were no "reasonably precise specifications" that "limited [VSE's] ability to comply with" a duty to warn. Id.6 VSE was not acting under any direct orders or detailed regulations from the government. Unlike in Leite, no detailed specifications dictated the manner and method of the contractor's performance — in this case, how to destroy the fireworks. Instead, VSE and Donaldson had broad discretion to develop and implement the way they would perform their contractual duties. Again,

Doc. No. 88, Nov. 29, 2012 Order, 914 F.Supp.2d at 1164, 2012 WL 5996548 at *14. "The government was relying on the expertise of defendants and not vice versa." In re Hanford, 534 F.3d at 1007. It follows that a Boyle defense is not colorable.

b. Derivative sovereign immunity under Yearsley and its progeny

Lastly, VSE relies on a "derivative" or "shared" immunity doctrine under Yearsley and subsequent caselaw. Yearsley analyzed whether a federal contractor could be held liable for damage caused by the construction of dikes in the Missouri River. See 309 U.S. at 19-20, 60 S.Ct. 413. It was undisputed that the federal government directed the project, which was authorized by an Act of Congress. Id. at 19, 60 S.Ct. 413. Yearsley concluded that the contractor could not be held liable, reasoning that when the "authority to carry out the project was validly conferred ... there is no liability on the part of the contractor for executing [Congress'] will." Id. at 20-21, 60 S.Ct. 413. But it recognized that "[w]here an agent or officer of the Government purporting to act on its behalf has been held to be liable for his conduct causing injury to another, the ground of liability has been found to be either that he exceeded his authority or that it was not validly conferred." Id. at 21, 60 S.Ct. 413.

Many federal courts have since construed Yearsley as creating a distinct "doctrine of derivative sovereign immunity." McMahon v. Presidential Airways, Inc., 502 F.3d 1331, 1343 (11th Cir.2007). See, e.g., Butters v. Vance Int'l, Inc., 225 F.3d 462, 466 (4th Cir.2000) (holding that a private contractor is entitled to derivative sovereign immunity for following commands of a foreign sovereign); Ackerson v. Bean Dredging LLC, 589 F.3d 196, 207 (5th Cir.2009) (referring to the doctrine of "shared immunity"); In re World Trade Center Disaster Site Litig., 521 F.3d 169, 196 (2d Cir.2008) (discussing "derivative immunity"); Myers v. United States, 323 F.2d 580, 583 (9th Cir.1963) ("To the extent that the work performed by McLaughlin, Inc., was done under its contract with the Bureau of Public Lands, and in conformity with the terms of said contract, no liability can be imposed upon it for any damages claimed to have been suffered by the appellants.") (citing Yearsley).

"The Yearsley doctrine is subject to two important limitations. First, `a key premise of Yearsley, and one that has been reiterated by [various federal courts] is that the contractor was following the sovereign's directives.'" In re Fort Totten Metrorail Cases, 895 F.Supp.2d 48, 74 (D.D.C.2012) (quoting Chesney v. Tenn. Valley Auth., 782 F.Supp.2d 570, 582 (E.D.Tenn.2011)). Yearsley "acknowledged that an agent or officer of the Government purporting to act on its behalf, but in actuality exceeding his authority, shall be liable for his conduct causing injury to another." Id. (citations omitted). "Second, derivative sovereign immunity is not available to contractors who act negligently in performing their obligations under the contract." Id. (citing Ackerson, 589 F.3d at 207 (stating that a contractor that commits a "separate act of negligence" is not entitled to derivative sovereign immunity under Yearsley), and City of Worcester v. HCA Mgmt. Co., 753 F.Supp. 31, 38 (D.Mass.1990) (reiterating that Yearsley does not apply "when a private corporation who performs governmental duties pursuant to contractual authority from the government is sued for negligence in the performance of these duties")). These limitations recognize that "the government does not become the conduit of its immunity in suits against its agents or instrumentalities merely because they do its work." Keifer & Keifer v. Reconstruction Fin. Corp., 306 U.S. 381, 388, 59 S.Ct. 516, 83 L.Ed. 784 (1939) (citations omitted). Thus, Yearsley does not abrogate "the principle that an agent is liable for his own torts [which] `is an ancient one and applies even to certain acts of public officers or public instrumentalities.'" Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 687, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949) (quoting Brady v. Roosevelt S.S. Co., 317 U.S. 575, 580, 63 S.Ct. 425, 87 L.Ed. 471 (1943)).

VSE relies on caselaw such as Butters, 225 F.3d at 467, and City of Worcester, 753 F.Supp. at 38, for a broad application of Yearsley. In response, Plaintiffs assert that derivative sovereign immunity, as a distinct doctrine, does not apply in the Ninth Circuit. See Rodriguez v. Lockheed Martin Corp., 627 F.3d 1259, 1265 (9th Cir.2010) ("Although the source of the government contractor defense is the United States' sovereign immunity, we have explicitly stated that `the government contractor defense does not confer sovereign immunity on contractors.'") (quoting United States ex rel. Ali v. Daniel, Mann, Johnson & Mendenhall, 355 F.3d 1140, 1147 (9th Cir.2004) ("DMJM")).7 But it is far from clear whether Rodriguez and DMJM considered Yearsley as distinct from a "government contractor defense" under Boyle.

Regardless, both defenses have a similar rationale. See, e.g., Chesney, 782 F.Supp.2d at 581 ("As the Sixth Circuit acknowledged in Bennett, derivative immunity of Yearsley and the government contractor defense of Boyle address the same federal interest of a contractor's performance of a government contract."). Bixby persuasively summarized the underlying common logic as follows:

748 F.Supp.2d at 1242. In contrast, where

Id.

Applying these ideas here, VSE has no colorable claim to derivative sovereign immunity. First, as analyzed with the other prongs under § 1442(a)(1), VSE was not simply "following the sovereign's directives." Chesney, 782 F.Supp.2d at 582. Again, it was an "independent contractor" that, along with Donaldson, developed and implemented the fireworks destruction plan (albeit with government approval).8 The government did not "specif[y] the manner in which the task [was] to be performed." Bixby, 748 F.Supp.2d at 1242. Rather, VSE was "allowed to exercise discretion in determining how the task should be accomplished." Id. The harm alleged against VSE "can be traced, not to the government's actions or decisions, but to the contractor's independent decision to perform the task in an unsafe manner." Id. And because VSE was not "hired to perform the [fireworks destruction] according to precise specifications," it did not "fail[] to comply with [such] specifications." Id. VSE is thus "not entitled to immunity because, again, the harm was not caused by the government's insistence on a specified manner of performance." Id.

Second, as VSE acknowledges, the Complaints allege that VSE was negligent in, among other allegations, failing to eliminate known risks of harm, failing to warn Plaintiffs, failing to provide a safe workplace, failing to properly manage and store the fireworks, and failing to ensure compliance with laws and regulations regarding explosives. E.g., Doc. No. 1-2 (Kelii), Compl. ¶¶ 27-36. Such allegations of negligence render the defense inapplicable. See Ackerson, 589 F.3d at 207 (stating that a contractor that commits a "separate act of negligence" is not entitled to derivative sovereign immunity under Yearsley); City of Worcester, 753 F.Supp. at 38 ("[A] private corporation performing governmental functions pursuant to contractually delegated authority will not be liable unless:... the harm was caused by the private party's own tortious conduct."); In re Katrina Canal Breaches Consol. Litig., 2007 WL 763742, at *4 (E.D.La. Mar. 9, 2007) ("Contractors cannot be held liable for performing contracts in conformity with the Government's specifications, providing the contractors carried out such contracts with due care and absent negligence.") (citations omitted).

Aware of this limitation, VSE emphasizes the allegations that it was involved in an ultra-hazardous activity for which strict liability — not negligence — applies. And because the United States cannot be liable under the FTCA under a strict liability theory, see, e.g., Laird, 406 U.S. at 802-03, 92 S.Ct. 1899, VSE essentially argues that it, as a government agent, should be entitled to the benefits of that same immunity.

The argument, however, is again foreclosed by the finding that VSE is an independent contractor. As such, in the Ninth Circuit, VSE's defense fails for this lack of an agency relationship. See In re Hanford, 534 F.3d at 1001 ("[Yearsley] limited the applicability of the defense to principal-agent relationships where the agent had no discretion ... and completely followed government specifications. Nothing in Yearsley extended immunity to [government] contractors exercising a discretionary governmental function.").9

Moreover, even if an "agency relationship" exists and VSE were found to have been involved in an ultrahazardous activity (for which strict liability attaches) in destroying fireworks, this still would not entitle it to share the government's immunity. See, e.g., D.F. Portis v. Folk Constr. Co., 694 F.2d 520, 524 (8th Cir.1982) (applying the "well settled general principle that one who contracts with a public body for performance of public work, if not guilty of negligence or [a] willful tort, and if not employing ultra hazardous methods, is entitled to share the immunity of the public body") (quoting A.E. Korpela, Annotation, Right of Contractor with Federal, State, or Local Public Body to Latter's Immunity from Tort Liability, 9 A.L.R.3d 382, 386 (1966) (emphasis added)).

Portis recognized that Yearsley was the "leading case establishing the shared immunity doctrine" as analyzed in 9 A.L.R.3d 382. See Portis, 694 F.2d at 524. That is, it applied

9 A.L.R.3d § 2[a]. And, under this general principle, if ultrahazardous activity is involved, the contractor (as opposed to a public officer) is not entitled to shared "public" (i.e., governmental) immunity — just as it could not share such immunity if it were negligent. See, e.g., Ackerson, 589 F.3d at 207 (stating that a contractor that commits a "separate act of negligence" is not entitled to derivative sovereign immunity under Yearsley). Indeed, applying this principle, a California court addressing this very issue specifically held that an independent contractor engaged in an ultra-hazardous activity is not entitled to governmental immunity under the FTCA even if performing under a federal government contract. See Smith v. Lockheed Propulsion Co., 247 Cal.App.2d 774, 56 Cal.Rptr. 128, 138-40 (1967). See also, e.g., Lowry Hill Props., Inc. v. Ashbach Constr. Co., 291 Minn. 429, 194 N.W.2d 767, 772 (1972) ("[T]he doctrine of sovereign immunity is not to be extended to a contractor who engages in an ultrahazardous or inherently dangerous activity even though he follows the specifications and directions of the sovereign.") (citing cases).10

Further, the Ninth Circuit (applying Washington State law) has held that a government contractor is not entitled to the immunity from strict liability for abnormally dangerous activities that is otherwise provided to public officers or employees pursuing "public duties" under the Restatement (Second) of Torts § 521.11 See In re Hanford, 534 F.3d at 1005-07. In re Hanford reasoned that for contractors to share such public immunity, they "must be operating pursuant to the mandate and control of the government; they must have little discretion over the manner in which they conduct their activities." Id. at 1007 (citations omitted).12 And, as analyzed above, VSE was not operating under such governmental control. In short, VSE has no colorable claim to a "derivative sovereign immunity" defense.

C. Attorneys' Fees Under 28 U.S.C. § 1447(c)

Finally, Plaintiffs seek attorneys' fees and costs under 28 U.S.C. § 1447(c), which provides in pertinent part that "[a]n order remanding the case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of the removal." "[A]n award of fees under § 1447(c) is left to the district court's discretion." Martin v. Franklin Capital Corp., 546 U.S. 132, 139, 126 S.Ct. 704, 163 L.Ed.2d 547 (2005). "Absent unusual circumstances, courts may award attorney's fees under § 1447(c) only where the removing party lacked an objectively reasonable basis for seeking removal." Id. at 141, 126 S.Ct. 704.

Applying its discretion, the court declines to award fees or costs to Plaintiffs as a result of VSE's removal. Although, ultimately, the decision to dismiss the Third-Party Complaints against United States was clear, such a result required considerable review of the record as set forth in the Nov. 29, 2012 Order. And the issues regarding federal officer removal under § 1442(a)(1) also involved a relatively complex analysis of a statute that is to be construed "liberally" and interpreted "broadly in favor of removal." Durham, 445 F.3d at 1252. In short, although the basis for remanding the actions is now clear, VSE nevertheless had an "objectively reasonable basis" for seeking removal.13

V. CONCLUSION

For the foregoing reasons, the Motions to Remand are GRANTED. These actions are REMANDED to the First Circuit Court of the State of Hawaii.

IT IS SO ORDERED.