November 3, 2015
from the United States District Court for the Southern
District of Indiana, Indianapolis Division. No.
1:14-cv-00472-TWP-TAB - Tanya Walton Pratt, Judge.
Wood, Chief Judge, Easterbrook, Circuit Judge, and Bruce,
District Judge. [*]
case arises from the world of auto racing and the
sponsorships that go along with it, but it is in the wrong
court. Panther Brands is a marketing and brand management
company. In 2013, Panther signed a contract with IndyCar,
which authorizes the Indy Racing League car series, to
purchase various marketing benefits to provide to its team
sponsor. The benefits included access to coveted space in the
"Fan Village" at IndyCar racing events, an area
where sponsors set up displays to attract fans. The Army
National Guard ("the Guard") had been Panther's
team sponsor from 2008 to 2013. After it signed the 2013
contract, Panther learned that another team, Rahal Letterman
Lanigan Racing ("RLL Racing"), intended to provide
the Guard with Fan Village space as a sponsorship benefit.
that RLL Racing had conspired with IndyCar and a bid
management agency called Docupak to persuade the Guard to
sponsor RLL Racing instead of Panther, Panther brought suit
in state court against RLL Racing, Docupak, IndyCar, and
active-duty Guard member John Metzler, who acted as the
liaison between the Guard and Panther. The defendants removed
the case to federal court, where the United States was
substituted as a party for Metzler, see 28 U.S.C. §
2679(d); Panther then filed an amended complaint that did not
name either Metzler or the United States. The district court
dismissed the complaint against RLL Racing, IndyCar, and
Docupak pursuant to Federal Rule of Civil Procedure 12(b)(6),
and found the United States's motion to dismiss for lack
of jurisdiction moot. Because the basis for federal
jurisdiction disappeared when Panther amended its complaint,
we vacate the district court's decision and remand for
dismissal for lack of jurisdiction.
Appellees offer several bases for federal subject-matter
jurisdiction over this dispute: removal based on the
existence of federal-question jurisdiction, 28 U.S.C.
§§ 1331, 1441; federal officer removal,
id. § 1442; and the Wes tfall Act, id.
§ 2679. None succeeds.
defendant may remove a lawsuit to federal court under 28
U.S.C. § 1441 when there is a claim that "arises
under the Constitution, laws, or treaties of the United
States." Id. § 1441(c)(1)(A). The federal
question must appear in the wellpleaded complaint; a federal
defense will not do. See id. (referring to 28 U.S.C.
§ 1331); Rivet v. Regions Bank of Louisiana,
522 U.S. 470, 475 (1998). Panther's amended complaint
asserts that RLL Racing and Metzler formed an agreement that
violated "multiple federal statutes and
regulations." IndyCar regards this as an adequate
jurisdictional allegation, but it is not. The fact that
federal regulations (such as those affecting the Guard's
contracts) may have some bearing on the case tells us nothing
about jurisdiction; the question remains whether the claim is
based on state or federal law. See Nuclear Eng'g Co.
v. Scott, 660 F.2d 241, 249 (7th Cir. 1981) (finding no
federal jurisdiction over claims "predicated upon state
law that at most incorporates federal law in certain
tangential respects"). Panther's complaint alleges
breach of contract, interference with contract, unjust
enrichment and conversion, and unfair competition and bid
rigging. These are all state-law theories, and none is
"essentially federal in character." Id.
Jurisdiction under sections 1331 and 1441 is therefore
Appellees also invoke 28 U.S.C. § 1442, the federal
officer statute, as a basis for subject-matter jurisdiction.
Section 1442 permits removal to federal court of an action
against "[t]he United States or any agency thereof or
any officer (or any person acting under that officer) of the
United States or of any agency thereof, in an official or
individual capacity, for or relating to any act under color
of such office[.]" 28 U.S.C. § 1442(a)(1).
Federal-officer removal is possible when (1) the defendant is
a "person" within the meaning of the statute, (2)
the defendant is "act[ing] under" some entity of
the United States, (3) the defendant is acting under color of
federal authority, and (4) the defendant has a colorable
federal defense. Ruppel v. CBS Corp., 701 F.3d 1176,
1180–81 (7th Cir. 2012).
and the other appellees contend that Docupak acted as a
federal officer and thus that this was a valid basis for
their removal. We accept that Docupak is a "person"
within the meaning of section 1442, according to the law of
this Circuit. Id. at 1181; contra Roche v. Am.
Red Cross, 680 F.Supp. 449, 455 (D. Mass. 1988)
(concluding that "the text of section 1442 suggests that
only natural persons are covered"). But we run into
trouble when we consider whether Docupak was acting for a
governmental entity and under color of federal authority.
says that it "acted under" the Guard by collecting
and summarizing bids for the Guard's sponsorship. There
are indeed cases supporting this form of removal "where
the federal government uses a private corporation to achieve
an end it would have otherwise used its own agents to
complete." Id. The Supreme Court applied this
doctrine in decisions finding persons to be acting under
federal entities when assisting in distillery raids during
Prohibition. Maryland v. Soper, 270 U.S. 9, 30
(1926); Davis v. State of S. Carolina, 107 U.S. 597,
600 (1883); Tennessee v. Davis, 100 U.S. 257, 261
(1879). Other courts have held that private entities were
acting under the federal government or its agencies for
federal-officer removal purposes when providing benefits to
federal employees under the direction of the Office of
Personnel Management, Jacks v. Meridian Res. Co.,
LLC, 701 F.3d 1224, 1234 (8th Cir. 2012); when
manufacturing Agent Orange for the United States, Winters
v. Diamond Shamrock Chem. Co., 149 F. 3 d 387,
399–400 (5th Cir. 1998); and when operating
environmental preserves pursuant to National Oceanic and
Atmospheric Administration grants, Town of Davis v. W.
Virginia Power & Transmission Co., 647 F.Supp.2d
622, 630 (N.D. W.Va . 2007).
grant that private contractors performing tasks for the
government are sometimes covered under section 1442, but
Appellees take this idea too far. We held in Lu Junhong
v. Boeing Co., 792 F.3d 805, 810 (7th Cir. 2015), that
merely being subject to federal regulations or performing
some functions that the government agency controls is not
enough to transform a private entity into a federal officer.
Indeed, in Watson v. Philip Morris Cos., Inc., 551
U.S. 142 (2007), the Supreme Court held that "the fact
that a federal regulatory agency directs, supervises, and
monitors a company's activities in considerable
detail" does not suffice to make that company a
"person acting under" a federal officer.
Id. at 145. Docupak's activities on behalf of
the Guard fell far short of the closely monitored and highly
regulated relationships involved in the distillery, federal
benefits, Agent Orange, or oceanic preserves cases on which
it relies. ...