Articles Posted in Federal Pre-emption

The Federal Tort Claim Act (FTCA) provides that a tort claim against the United States “shall be forever barred” unless the claimant meets two deadlines. First, the claim must be presented to the appropriate federal agency for administrative review “within two years after [the] claim accrues.” 28 U.S.C. §2401(b). Second, if the agency denies the claim, the claimant may file a suit in federal court “within six months” of the agency’s denial. Id.

In this United States Supreme Court decision, Kwai Fun Wong and Marlene June, respondents in Nos. 13-1074 and 13-1075, respectively, each missed one of those deadlines. Wong failed to file her FTCA claim in federal court within 6 months, but argued that was only because the District Court had not permitted her to file that claim until after the period expired. June failed to present her FTCA claim to the federal agency within 2 years, but argued that her untimely filing should be excused because the government had, in her view, concealed facts vital to her claim.

In each of these cases, the District Court dismissed the FTCA claim for failure to satisfy §2401(b)’s time bars, holding that, despite any justification for delay, those time bars are jurisdictional and not subject to equitable tolling. The Ninth Circuit reversed in both cases, concluding that §2401(b)’s time bars may be equitably tolled.

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The U.S. Court of Appeals for the 7th Circuit in Chicago has reversed the decision of a U.S. District Court judge wherein an agreement between the parties, Hennessy Industries Inc. and National Union Fire Insurance Co. of Pittsburgh, required arbitration of any dispute that mandated an interpretation of the agreement. In this case, Hennessy Industries manufactured car parts. Since the 1980s, Hennessy has been the named defendant in many lawsuits for asbestos-related personal-injury cases. Hennessy has been looking to National Union Fire Insurance Co. of Pittsburgh for insurance coverage for these claims. The two companies entered into a cost-sharing agreement in 2008.

When the lawsuits for asbestos-related injuries started coming in, Hennessy requested that National Union indemnify it for settlement and defense costs as provided for in their agreement. The two parties, however, could not come to an agreement as to what was owed. Hennessy demanded arbitration in line with the agreement, which provided for arbitration of disputes between the parties.

Hennessy filed suit in 2013 under 215 ILCS 5/155(1), maintaining that National Union’s delays in granting coverage of the asbestos claims had been vexatious and unreasonable.

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Hennessy Industries was a car part manufacturer. It was sued frequently for asbestos-related personal injury claims. Hennessy sought insurance coverage for these claims from National Union Fire Insurance Co. The companies entered into a cost-sharing agreement in 2008. However, as the lawsuits and claims came in, Hennessy asked National Union to indemnify its settlements and defense costs. To resolve their differences about what was owed, Hennessy demanded arbitration under the agreement. Illinois law would be applied.

Hennessy filed a lawsuit against National Union under the Illinois Insurance Code, 215 ILCS 5/155(1), which provides that, in cases involving vexatious and unreasonable delay, the court may award reasonable attorney fees, other costs, plus an additional amount.

Hennessy claimed that National Union’s delays in providing coverage were vexatious and unreasonable. The federal district court judge in Chicago declined to dismiss the case, acknowledging a provision that “the arbitrator shall not be empowered or have jurisdiction to award punitive damages, fines or penalties,” but held that Hennessy’s claim arose under statutory law rather than under the cost-sharing agreement.

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The U.S. Court of Appeals for the 7th Circuit in Chicago has dismissed an appeal from a U.S. District Court judge. In an extremely sad case, Robert Lindner’s parents, Burton and Zorine Lindner, were driving under a bridge near north suburban Glenview, Ill., when a Union Pacific freight train derailed overhead. The derailment caused the collapse of the bridge crushing the Lindners in their car. Their son brought a lawsuit against Union Pacific and a wrongful death action in Illinois state court alleging that Union Pacific’s negligence caused the accident and his parents’ wrongful deaths.

At the time the lawsuit was filed, there was complete diversity between the parties. That means that the residencies of the plaintiffs and the residencies of the defendants must be of different states. The decedents were residents and citizens of Illinois. The residency determines diversity jurisdiction. Mr. Lindner was acting as a representative of the estate.

Union Pacific is a Delaware corporation with its principal place of business in Omaha, Neb. Union Pacific removed the case to the Federal District Court for the Northern District of Illinois in Chicago because of the complete diversity of the parties.

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In a case decided in the Eastern District of Pennsylvania, Perry v. A.W. Chesterton Inc., it was determined that brakes located onto a rail car are a “part or appurtenance” to a locomotive and therefore the plaintiff’s state law asbestos claims were pre-empted by the federal Locomotive Inspection Act (LIA).  

Alice Perry brought this lawsuit on behalf of her husband, who died of asbestos-related injuries after installing and removing Railroad Friction Products Corp. brake shoes on rail cars.The locomotive is at the front of the train, which pulls the rail cars that carry the cargo of passengers or products.

Perry argued that the specific brakes and brake materials that her husband was exposed to were found only in rail cars and not locomotives. She maintained that her claim was not pre-empted by the LIA, which governs only locomotives.

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