Unreported / Non-Citable
Background
Theodore Nelson worked as a ramp agent at Los Angeles International Airport. In September 2023, his hand was caught between the unguarded conveyor belt and the tension pulley of a Tug 660 belt loader, causing severe lacerations and a “degloving” injury that required surgery at UCLA Medical Center. He sued the equipment manufacturer Textron, its predecessor Tug Technologies, and two ground-handling companies, AGI Ground and AGI Cargo, in Los Angeles County Superior Court for strict and negligent product liability and negligence.
Textron removed the case to federal court based on diversity jurisdiction — the rule that lets defendants move a state-court case to federal court when the parties are from different states and more than $75,000 is at stake. Nelson did not contest diversity. Instead, he moved to remand under 28 U.S.C. § 1445(c), a special statute that bars removal of cases “arising under the workmen’s compensation laws” of a state. He argued his claims arose under California workers’ compensation law because the AGI defendants planned to assert the workers’-compensation exclusivity rule as a defense.
The Court’s Holding
The court denied remand and kept the case in federal court. It explained that Section 1445(c) applies the same “arising under” test used in 28 U.S.C. § 1331 (the federal-question statute): a claim arises under workers’ compensation law only if the workers’ compensation statute either creates the cause of action or supplies a necessary element of the claim.
Nelson’s causes of action — strict product liability, negligent product liability, and ordinary negligence — sound in California common-law tort, not workers’ compensation. To prevail, he must prove the elements of those tort claims, none of which depend on California’s workers’ compensation framework. Other district courts in California, including in Lee v. Terex and Ramos v. Crown Equipment, have reached the same conclusion in analogous workplace-injury cases.
The court rejected Nelson’s argument that the AGI defendants might raise the workers’-compensation exclusivity bar as an affirmative defense. Federal jurisdiction is determined by the well-pleaded complaint — the plaintiff’s claims — not by anticipated defenses. Nelson cited no authority treating the workers’-compensation defense differently from any other affirmative defense for jurisdictional purposes.
Key Takeaways
- Section 1445(c)’s no-removal rule applies only when the workers’ compensation statute creates the cause of action or supplies a necessary element — not when it might be raised as a defense.
- A plaintiff’s tort claims — product liability, negligence, breach of warranty — are not claims “arising under” workers’ compensation law just because the injury happened on the job.
- The well-pleaded complaint rule controls: anticipated defenses cannot defeat removal.
- The Ninth Circuit has not squarely defined “arising under” for Section 1445(c), but district courts uniformly use the same test as 28 U.S.C. § 1331.
- An injured worker can pursue both a workers’ compensation claim against an employer and a separate tort suit against equipment manufacturers and other third parties.
Why It Matters
Section 1445(c) is one of the few statutory protections that keeps certain state-court cases in state court regardless of diversity. For workers injured on the job, the practical question is which forum will hear their suit against the equipment manufacturer or other third party. Plaintiffs sometimes invoke § 1445(c) to keep these cases in state court, where juries are often more sympathetic and discovery can be cheaper.
This decision tightens that path: unless the workers’ compensation statute itself creates the legal claim, the case is removable. For California product-liability lawyers, the message is that ordinary tort claims arising from a workplace accident will almost always be heard in federal court when diversity exists, and that planning around the workers’-compensation exclusivity defense will not change the analysis.