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Hammond v. Phillips 66 Co.

United States District Court, S.D. Mississippi, Eastern Division

February 12, 2015

PHILLIPS 66 COMPANY, ET AL., Defendants.


KEITH STARRETT, District Judge.

This matter is before the Court on the Plaintiff Wendell Hammond's Motion to Remand [10]. Having considered the submissions of the parties, the record, and the applicable law, the Court finds that this action should be remanded to the Circuit Court of Marion County, Mississippi.


On November 8, 2013, Wendell Hammond filed suit against Phillips 66 Company and numerous other Defendants in the Circuit Court of Marion County, alleging injury as a result of being exposed to asbestos while working in the oil industry from approximately 1968 until 1979. ( See Compl. [10-1].) Hammond alleges that he suffers from asbestosis and related lung disease because of his frequent and sustained exposure to drilling mud additives and products containing asbestos that were negligently and defectively designed, manufactured, marketed, distributed, and sold by each Defendant. ( See Compl. [10-1] at pp. 1, 5-6.) Hammond charges the Defendants with, inter alia, negligence, defective manufacture, defective design, strict liability, and negligent infliction of emotional distress under Mississippi law. ( See Compl. [1] at p. 7.)

The Complaint also asserts confusing claims against "Jones Act Defendants" under "general maritime law" and the Jones Act to "the extent Plaintiff was exposed to asbestos drilling mud and additives... while Plaintiff worked on oil rigs in the Gulf of Mexico...." (Compl. [1] at pp. 7-8.) The Jones Act authorizes an injured seaman to bring a civil action against his employer. See 46 U.S.C. § 30104. Hammond does not claim that he was employed by any named Defendant. In April of 2014, Hammond's general maritime claims were dismissed via the state court's Agreed Order Dismissing Plaintiff's General Maritime Law Claims [10-3].

On July 28, 2014, Chevron Phillips Chemical Company LP, as successor in interest to Defendant Phillips 66 Company ("CPChem"), removed the proceeding to this Court.[1] ( See Notice of Removal [1].) Removal is predicated on two grounds: (1) Title 43 U.S.C. § 1349(b)(1) of the Outer Continental Shelf Lands Act ("OCSLA"); and (2) diversity of citizenship subject matter jurisdiction under 28 U.S.C. § 1332. The Notice of Removal provides that OCSLA jurisdiction exists because Hammond alleges that he was exposed to drilling mud products containing asbestos while he worked on Kerr-McGee's semi-submersible, which was engaged in mineral exploration or development on the Outer Continental Shelf.[2] As to diversity jurisdiction, the Notice of Removal indicates that § 1332(a)'s amount in controversy requirement is met because Hammond seeks a judgment in an amount exceeding $75, 000, exclusive of interest and costs. CPChem argues that complete diversity exists between Hammond and all properly joined Defendants, and that the apparent Mississippi citizenship of Defendants Oilfield Service and Supply Company, Inc. ("OSS") and GEO Drilling Fluids, Inc., individually and as successor by merger with Mississippi Mud, Inc. ("Mississippi Mud"), should be disregarded because these Defendants have been improperly joined. CPChem contends that it timely removed the case within thirty (30) days of its receipt of Hammond's deposition transcript, which enabled CPChem to ascertain that the case was removable.

On August 23, 2014, Hammond filed his Motion to Remand [10]. Hammond does not allege any procedural defects in removal in support of his remand request. Instead, Hammond challenges the existence of federal jurisdiction under OCSLA and 28 U.S.C. § 1332.


A. General Removal Standards

"A district court has removal jurisdiction in any case where it has original jurisdiction." Gutierrez v. Flores, 543 F.3d 248, 251 (5th Cir. 2008) (citing 28 U.S.C. § 1441(a)). "The removing party bears the burden of establishing that federal jurisdiction exists." De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995) (citing Gaitor v. Peninsular & Occidental S.S. Co., 287 F.2d 252, 253-54 (5th Cir. 1961)). A motion to remand alleging a procedural defect in removal must be brought within thirty (30) days of the filing of the notice of removal, but "the case shall be remanded" at any time before final judgment if it appears that subject matter jurisdiction is lacking. 28 U.S.C. § 1447(c). Since federal courts are of limited jurisdiction and removal raises significant federalism concerns, the "removal statutes are to be construed strictly against removal and for remand." Eastus v. Blue Bell Creameries, L.P., 97 F.3d 100, 106 (5th Cir. 1996) (citations omitted). Courts are to consider "jurisdictional facts as they existed at the time of removal" in ruling on a motion to remand. Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 265 (5th Cir. 1995).

B. OCSLA Jurisdiction, 43 U.S.C. § 1349(b)(1)

Section 1349 states in pertinent part:

[T]he district courts of the United States shall have jurisdiction of cases and controversies arising out of, or in connection with (A) any operation conducted on the outer Continental Shelf which involves exploration, development, or production of the minerals, of the subsoil and seabed of the outer Continental Shelf, or which involves rights to such minerals....

43 U.S.C. § 1349(b)(1). The United States Court of Appeals for the Fifth Circuit broadly interprets this statutory text. See, e.g., In re Deepwater Horizon, 745 F.3d 157, 163 (5th Cir. 2014), cert. denied, 135 S.Ct. 401 (2014); Barker, 713 F.3d at 213. In Barker, the Fifth Circuit articulated "a but-for test" for determining the existence of OCSLA jurisdiction, "asking whether: (1) the facts underlying the complaint occurred on the proper situs; (2) the plaintiff's employment furthered mineral development on the OCS; and (3) the plaintiff's injury would not have occurred but for his employment." 713 F.3d at 213 (citations omitted). In Deepwater Horizon, the Fifth Circuit articulated the jurisdictional inquiry in slightly different terms, but still noted that § 1349 only requires "a but-for' connection." 745 F.3d at 163 (citations omitted). "Courts typically assess jurisdiction under this provision in terms of whether (1) the activities that caused the injury ...

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