Establishing federal jurisdiction through the Grable
doctrine is rare, but a Missouri federal court recently reminded us
that it is not impossible. In Bader Farms, Inc. v.
Monsanto Co., No. 1:16-CV-299 SNLJ, 2017 WL 633815 (E.D. Mo.
Feb. 16, 2017), the court found that, even though federal
jurisdiction did not appear on the face of the complaint, it
existed under Grable because the plaintiffs' state-law
claims required examination of the actual practices of and
regulations guiding a federal agency, thus raising a significant
federal issue. This case may be useful for many companies
subject to federal regulation seeking to invoke removal
The BaderFarms plaintiffs, a group of
farmers, originally sued Monsanto in Missouri state court,
asserting a number of state law claims. They alleged that
Monsanto fraudulently concealed information from the Animal and
Plant Health Inspection Service (APHIS), the federal agency that
regulates genetically engineered seeds, when it petitioned to
deregulate genetically engineered soybean and cotton seeds.
APHIS ultimately approved the petition, and the seeds were released
to the public. According to the plaintiffs, Monsanto
intentionally withheld from APHIS that a corresponding herbicide
had yet to be approved by the EPA. Rather than wait for the
new compatible herbicide, farmers who bought the new seeds treated
their crops with an old, illegal herbicide that drifts onto nearby
farms and kills non-genetically-engineered crops. The
BaderFarms plaintiffs were farmers whose crops
were allegedly damaged by this drifting herbicide.
Monsanto removed the case to federal court. The complaint
had only state-law claims against a non-diverse defendant, which
almost always defeats federal jurisdiction. Yet Monsanto
defeated the farmers' motion to remand. How?
The answer lies in the "Grable doctrine," a
rarely successful basis for federal question jurisdiction.
Under the well-pleaded complaint rule, federal question
jurisdiction must appear on the face of the complaint and cannot be
created by a federal defense. This typically means that
state-law claims cannot create federal question jurisdiction.
In Grable & Sons Metal Prod., Inc. v. Darue Eng'g &
Mfg., 545 U.S. 308 (2005), however, the Supreme Court
established a narrow doctrine under which federal question
jurisdiction exists if a state-law claim "raise[s] a federal
issue, actually disputed and substantial, which a federal forum may
entertain without disturbing any congressionally approved balance
of federal and state responsibilities." Id. at
The Bader Farms court relied on Grable in
finding that federal jurisdiction existed. According to the
court, the farmers' allegations directly questioned the actual
practices of and regulations governing APHIS—for example,
whether APHIS would have deregulated the genetically engineered
seeds had Monsanto not allegedly concealed the truth. The
case ultimately posed a "collateral attack on the validity of
APHIS's decision to deregulate the new seed."
Bader Farms Inc., 2017 WL 633815, at *3. Thus, the
court concluded that the question raised a substantial federal
issue under Grable.
This outcome might seem straightforward, but it actually marks a
significant victory for defendants. Efforts to establish
federal jurisdiction through Grable have rarely
succeeded. Indeed, courts routinely reject Grable
arguments even where state-law claims clearly implicate federal
issues and regulations. (We recently discussed one such case
here.)1Bader Farms might give some
defendants a leg up in trying to avoid that result. Under
Bader Farms, if a plaintiff alleges that (1) a defendant
concealed from a federal agency information that it had a duty to
disclose, (2) the information was material, and (3) the concealment
prevented the agency from performing its regulatory duties, the
defendant may be able to remove based on a significant federal
issue. This precedent will be useful for companies in
regulated industries who wish to litigate in federal court.
Because of the generality of this update, the information
provided herein may not be applicable in all situations and should
not be acted upon without specific legal advice based on particular
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