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Aarstad v. BNSF Railway Co.

United States District Court, D. Montana, Great Falls Division

October 15, 2018

KOREY L. AARSTAD, et al., Plaintiffs,
BNSF RAILWAY COMPANY, et al., Defendants.



         Plaintiff Korey L. Aarstad, along with 191 other named plaintiffs (collectively “Plaintiffs”), sought an order remanding this case to state court on the basis that the case was improperly removed from Montana state court based on defendant John Swing's (“Mr. Swing”) Montana citizenship. Defendants BNSF Railway Company and Mr. Swing (collectively “BNSF”) objected, stating the case was properly removed as a mass action. United States Magistrate Judge John Johnston entered Findings and Recommendations in this matter on January 23, 2018. Id.

         Defendants timely filed an objection on February 6, 2018. (Doc. 61). Defendants claim Judge Johnston incorrectly applied the local controversy exception. (Doc. 61 at 2). The Plaintiffs timely filed an objection to preserve arguments in regard to Judge Johnston's remand recommendation on February 6, 2018. (Doc. 62).

         The Court reviews de novo Findings and Recommendations to which a party timely objects. 28 U.S.C. § 636(b)(1). The Court reviews for clear error portions of Judge Johnston's Findings and Recommendations to which the parties specifically objected. McDonnell Douglas Corp. v. Commodore Bus. Mach., Inc., 656 F.2d 1309, 1313 (9th Cir. 1981).


         In 1963, the W.R. Grace & Co. (“WRG”) purchased a vermiculite mill in Libby, Montana, from the Zolonite Company. WRG operated the mill until 1990. (Doc. 8 at 2). Plaintiffs were all workers of WRG or Zolonite Company. As a result of toxic asbestos present in the vermiculite ore, thousands of residents of Libby have been diagnosed with mesothelioma, asbestosis, or other asbestos-related diseases over the course of several decades. Id. As a result, there are hundreds of asbestos related cases adjudicated or pending in Montana state courts. (Doc. 14 at 5).

         Defendant BNSF is a railway company incorporated in Delaware, with its headquarters in Texas. (Doc. 8 at 1). At all times pertinent to this case, BNSF commenced railway operations in the town of Libby, Montana. Mr. Swing served as a managing agent for BNSF and is a resident of Lincoln County, Montana. (Id.) Mr. Swing worked for BNSF from roughly 1970 to 1984. (Doc. 14-3 at 2).

         As a result of the bankruptcy of WRG, many Plaintiffs have had their cases stayed pending the bankruptcy process. Cases against BNSF have been subject to an injunction since 2007. (Doc. 14 at 5). Due to the disjunctive nature of the underlying claims, as well as the varying exposure events and dates of diagnosis, Plaintiffs' claims normally would be subject to several different statutes of limitations. The tolling period for Plaintiffs' claims ended in September of 2016, however, due to various tolling agreements between the parties and the pending bankruptcy action. (Id. at 7-8).

         Standard of Review

         A defendant may remove an action from state court to a federal court if the federal court would have possessed original subject matter jurisdiction over the matter. 28 U.S.C. § 1441. A federal court possesses original jurisdiction if the parties are completely diverse and the amount in controversy exceeds $75, 000. 28 U.S.C. § 1332(a). Complete diversity means that no defendant is a citizen of the same state as any plaintiff. The party seeking to remove an action to federal court holds the burden to show federal jurisdiction exists and that removal is proper. De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995).

         A federal court possesses original jurisdiction over certain class actions which have minimum diversity and an amount in controversy exceeding five million dollars, exclusive of costs and interests. 28 U.S.C. § 1332(d)(2). For the purposes of federal subject matter jurisdiction, a class action also includes a “mass action, ” which is defined as “any civil action . . . in which monetary relief claims of 100 or more persons are proposed to be tried jointly on the ground that the plaintiffs' claims involve a common questions of law or fact[.]” 28 U.S.C. § 1332 (d)(11)(B)(i). According to subsection (d)(11)(A) of the same statute, “a mass action shall be deemed to be a class action, ” and is removable pursuant to subsections (d)(2)-(d)(10).


         • Mass Action

         A “mass action” is a class action which can be removed to federal court if it meets the following elements: (1) numerosity: the action must involve the monetary claims of 100 plaintiffs or more; (2) amount in controversy: $5, 000, 000 or more in the aggregate (excluding interests and costs); (3) diversity: minimal diversity must be met, and; (4) commonality: plaintiffs' claims involve common ...

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