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BNSF Railway Co. v. Seats, Inc.

United States Court of Appeals, Eighth Circuit

August 13, 2018

BNSF Railway Company, a Delaware Corporation authorized to do business in Nebraska Plaintiff- Appellant
Seats, Incorporated, a Wisconsin Corporation Defendant-Appellee

          Submitted: May 17, 2018

          Appeal from United States District Court for the District of Nebraska - Lincoln

          Before WOLLMAN, BENTON, and STRAS, Circuit Judges.


         A BNSF engineer was injured when the backrest of his locomotive seat broke. He sued the BNSF Railway Company, claiming the seat did not comply with the federal standards in the Locomotive Inspection Act (LIA). The LIA requires locomotives, their parts, and appurtenances be "in proper condition and safe to operate without unnecessary danger of personal injury." 49 U.S.C. § 20701(1). The LIA has the "purpose and effect of facilitating employee recover[y]" by conferring on railroads a "duty to provide safe equipment." Urie v. Thompson, 337 U.S. 163, 188-89 (1949) (internal quotation marks omitted). An injured employee does not have a private right of action under the LIA. Id. An injured employee does have a private right of action under the Federal Employers' Liability Act (FELA). 45 U.S.C. § 51. BNSF settled a FELA claim with the engineer.

         BNSF then sued Seats, Inc., to recover the costs of settlement. Seats designed, manufactured, and marketed the seat that broke. Seats moved to dismiss, arguing that the LIA preempts BNSF's claims. BNSF countered that preemption does not apply to claims based on federal standards of care. The district court, citing a lack of clear authority, granted the motion to dismiss. See BNSF Ry. Co. v. Seats, Inc., 235 F.Supp.3d 1089 (D. Neb. 2017). See also Hughs v. Union Pacific R.R. Co., No. 5:15-06079-CV-RK, 2017 WL 1609646 (W.D. Mo. Apr. 28, 2017) (slip op.). BNSF appeals.

         This court reviews the grant of a motion to dismiss de novo. In re Pre-Filled Propane Tank Antitrust Litig., 860 F.3d 1059, 1063 (8th Cir. 2017) (en banc). The complainant "must show the plaintiff is entitled to relief, by alleging sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Id., quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks and citations omitted).


         The issue here is whether the LIA preempts BNSF's products-liability claims based on federally-imposed standards of care. The LIA preempts state legislation because Congress intended it "to occupy the field" of "the design, the construction, and the material of every part of the locomotive and tender and of all appurtenances." Napier v. Atlantic Coast Line R.R. Co., 272 U.S. 605, 611, 613 (1926). See Malone v. White Motor Corp., 435 U.S. 497, 504 (1978) ("The purpose of Congress is the ultimate touchstone" of preemption analysis). The holding of Napier "admits of no exception for state common-law duties and standards of care." Kurns v. Railroad Friction Prods. Corp., 565 U.S. 625, 637 (2012).

         Seats believes that the Napier and Kurns opinions resolve this case. Seats emphasizes the words "admits of no exception . . .." Id. Seats ignores the rest of the sentence: "no exception for state common-law duties and standards of care." Id. As Kurns puts it, "state common-law duties and standards of care directed to the subject of locomotive equipment are pre-empted by the LIA." Id. See also First Sec. Bank v. Union Pac. R.R. Co., 152 F.3d 877, 880 (8th Cir. 1998) (emphasizing that the LIA preempts state common-law remedies). Neither Napier nor Kurns addresses the present issue-whether the LIA preempts products-liability claims based on federal standards of care.

         Three courts have held that the field preempted by the LIA does not include state common-law actions based on LIA violations. See Delaware & Hudson Ry. Co. v. Knoedler Mfrs., Inc., 781 F.3d 656, 667 (3d Cir. 2015); BNSF Ry. Co. v. Seats, Inc., 349 P.3d 1096, 1100 (Ariz.Ct.App. 2015); Engvall v. Soo Line R.R. Co., 632 N.W.2d 560, 571 (Minn. 2001). Cf. Norfolk & Western Ry. Co. v. Ayers, 538 U.S. 135, 162 n.21, 165 n.23 (2003) (citing Engvall to support: "FELA defendants may bring indemnification and contribution actions against third parties under otherwise applicable state or federal law" and: "Once an employer has been adjudged negligent with respect to a given injury, it accords with the FELA's overarching purpose to require the employer to bear the burden of identifying other responsible parties and demonstrating that some of the costs of the injury should be spread to them").

         The Third Circuit based its holding partly on Supreme Court decisions about other statutes that allow common-law claims to remedy federal violations. See Knoedler, 781 F.3d at 662-63. The Knoedler case focused on the Safety Appliance Acts (SAAs). See 49 U.S.C. § 20301-06. The SAAs and the LIA are similar. Both regulate locomotive equipment. Both Acts "operate to exclude state regulation whether consistent, complementary, additional, or otherwise." Gilvary v. Cuyahoga Valley Ry. Co., 292 U.S. 57, 60-61 (1934) (SAAs). Accord Kurns, 565 U.S. at 637, citing Napier, 272 U.S. at 611-12 (LIA). "[T]he same principles apply in an action under the [LIA] as in one under the Safety Appliance Acts." Tipton v. Atchison, Topeka, & Santa Fe Ry. Co., 298 U.S. 141, 151 (1936). The "congressional purpose underlying the [LIA] is basically the same as that underlying the [SAAs]" that locomotives "be employed in . . . active service . . . without unnecessary peril to life or limb." Urie, 337 U.S. at 190 (ellipses in original) (internal quotation marks and citation omitted). Neither Act gives a private right of action to the injured employee. Id. at 188-89. Both Acts are enforced by a private right of action under FELA. Id.

         The SAAs allow state common-law claims by nonemployees for federal violations. See Crane v. Cedar Rapids & Iowa City Ry. Co., 395 U.S. 164, 166 (1969) (a "nonemployee must look for his remedy to a common-law action in tort, which is to say that he must sue in a state court, in the absence of diversity, to implement a state cause of action"). Cf. Breisch v. Cent. R.R. of N.J., 312 U.S. 484, 486 (1941) (finding there is no "longer a question as to the power of the state to provide whatsoever remedy it may choose for breaches of the [SAAs]. The federal statutes create the right; the remedy is within the state's discretion"); Tipton, 298 U.S. at 147-48 (the SAAs "do not give a right of action for their breach, but leave the genesis and regulation of such action to the law of the states"). "Like the LIA, the SAAs are silent as to whether state remedies are preempted. Despite that silence, the Supreme Court decided . . . that relief under state law was not preempted." Knoedler, 781 F.3d at 664.

         Seats argues that state claims based on federal standards of care threaten national uniformity. "But the enforcement under state law of a federal standard of care does not undermine national uniformity because it does not impose conflicting regulations that a railroad must heed during interstate travel." Id. at 666. Seats asserts the LIA's standard is "amorphous." To the contrary, it is as definite and certain as any rule submitted to a jury. See Baltimore & Ohio R.R. Co. v. Groeger, 266 U.S. 521, ...

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