Jalili-Farshchi v. Aldersly

Background

The plaintiffs, identified as the children of decedent Shamseddin Jalili-Farshchi, sued Aldersly and Cahill in California state court. The opinion describes Aldersly as a family of companies providing retirement and elder care in residential facilities, and Cahill as a family of construction companies hired by Aldersly to renovate its facilities. The complaint asserted California-law claims including elder abuse, medical negligence, and related claims arising from Jalili-Farshchi’s death from COVID-19.

Aldersly removed the case to federal court under federal-question and federal-officer jurisdiction. It argued that the federal Public Readiness and Emergency Preparedness Act, or PREP Act, completely preempted the state-law claims. Complete preemption is a jurisdictional doctrine that can turn certain state-law claims into federal claims for purposes of removal. Aldersly also argued that removal was allowed because the plaintiffs sued over acts undertaken at the direction of a federal officer. The plaintiffs asked the court to remand the case to state court.

Federal-Question Jurisdiction

The court held that the PREP Act did not completely preempt the plaintiffs’ claims. The court explained that complete preemption requires a federal statute to provide the exclusive cause of action for the asserted claim. Although the PREP Act broadly limits liability for losses related to covered countermeasures and creates a compensation fund for eligible injuries, the court concluded that the Act did not make those remedies the exclusive federal basis for the plaintiffs’ claims. The court also noted that the Act did not prevent Aldersly from asserting immunity or other statutory defenses in state court.

The court rejected Aldersly’s reliance on an advisory opinion from the Department of Health and Human Services, stating that the agency’s commentary could not substitute for Congress’s intent as expressed in the statute and that the advisory opinion itself said it did not have the force or effect of law.

The court also rejected removal based on a substantial federal question. The complaint raised only state-law claims, and interpreting the PREP Act was not essential to those claims. The court explained that PREP Act immunity was a defense that could be raised in state court, rather than a necessary part of the plaintiffs’ claims. Consequently, the complaint did not necessarily raise a federal issue supporting federal-question jurisdiction.

Federal-Officer Jurisdiction

The court separately rejected Aldersly’s argument under 28 U.S.C. § 1442(a)(1), which permits certain persons acting under the direction of a federal officer to remove a case to federal court. The court stated that Aldersly needed to show that it was a qualifying person, that a causal connection existed between federally directed actions and the plaintiffs’ claims, and that it could assert a plausible federal defense. The plaintiffs did not dispute the first and third requirements, so the court focused on whether Aldersly acted under a federal officer’s direction and whether the required causal connection existed.

Aldersly said it responded to COVID-19 consistently with directives from the Centers for Disease Control and Prevention, the Centers for Medicare and Medicaid Services, and the California Department of Public Health. The court held that merely complying with laws or regulations, even detailed or closely supervised ones, was not enough to satisfy the federal-officer requirement. The court also noted that Aldersly had not provided evidence comparable to the evidence supporting removal in a case involving a military contractor whose warnings were completely controlled by the Navy.

Disposition

The court concluded that both asserted grounds for removal were improper. The case was remanded to the Superior Court of California for the County of San Francisco. The opinion does not state that the remand was with or without prejudice.