U.S. Attorney’s Office for the Middle District of Tennessee and the U.S. Department of Justice File Statement of Interest Addressing the PREP Act’s Complete Federal Preemption of State Law Claims Related to COVID-19 Countermeasures

January 21, 2021

Authors: Marcia L. Pearson, Andrew-John R. Bokeno

On January 19, 2021, the United States Attorney’s Office for the Middle District of Tennessee and the U.S. Department of Justice issued a Statement of Interest in connection with a lawsuit against a Tennessee nursing home for failing to prevent the transmission of COVID-19. In this Statement of Interest, the United States argues that the Public Readiness and Emergency Preparedness (PREP) Act completely preempts state tort claims related to liability and immunity from the administration of COVID-19 countermeasures. 

Background of PREP Act & Related Litigation
The PREP Act was passed in 2005 and is activated in response to public health emergencies. The Act provides immunity to Covered Persons under the Act who are sued for claims of injury arising out of or relating to the administration or use of Covered Countermeasures designed to prevent, treat, cure, diagnose or limit the harm from a public health emergency, such as COVID-19. 

In particular, federal jurisdiction of state tort claims and the determination of immunity under the PREP Act has been a significant point of litigation. On December 3, 2020, the U.S. Department of Health and Human Services (HHS) Secretary’s latest amendment to the PREP Act indirectly addressed numerous federal court opinions that held that allegations outside of the specific use or distribution of countermeasures would trigger immunity under the Act, and therefore did not preempt the field of state law claims such that federal jurisdiction is warranted or required. Of note, the administration of Covered Countermeasures goes well beyond the simple use or distribution of the countermeasures, per the HHS Secretary’s Amendment to the Act. The term “administration” is to be broadly construed to include management of the distribution of countermeasures, which can include decisions that lead to the failure to actually distribute a countermeasure to a particular person. 

Importantly, the HHS Secretary’s Amendment provided that “substantial federal legal and policy issues, and substantial federal legal and policy interests” call for a unified “whole-of-nation” response to COVID-19, such that there “must be a more consistent pathway for Covered Persons” to implement the Covered Countermeasures to the pandemic. 

In the United States’ Statement of Interest (discussed below), the United States argues that the PREP Act affords complete preemption of state law claims under the Act, seeking to further solidify the exclusive federal jurisdiction of claims arising under specific provisions of the Act providing immunity to Covered Persons. To be sure, complete preemption would establish an exclusive cause of action that permits removal of a case to federal court via federal question jurisdiction even if the complaint pleads only state law causes of action – a type of preemption that is substantially different from other preemption doctrines. Complete preemption goes to the congressional intent of a statute to “completely preempt a particular area that any civil complaint raising [a] select group of claims is necessarily federal.” Metro Life Ins. Co. v. Taylor, 481 U.S. 58, 67 (2004). That is, complete preemption provisions “convert an ordinary state common law complaint into one stating a federal claim…” Id. at 65-66. As discussed above, complete preemption would allow a defendant to remove the action based on federal question jurisdiction, as the statute would effectively turn the claim “into one stating a federal claim.” Id. 

United States’ Statement of Interest in Tennessee Lawsuit
In arguing that complete preemption applies to claims under specific provisions of the PREP Act, the United States first noted in their Statement of Interest that claims under several other bodies of legislation have been afforded complete preemption. These include the Labor Management Relations Act, the Employee Retirement Income Security Act (ERISA), and the Air Transportation Safety and System Stability Act (ATSSSA), which are structurally similar to the PREP Act, as they all call for the need of “a strong form of national uniformity implied by Congress when it made federal court jurisdiction exclusive.” Ritchie v. Williams, 395 F.3d 283, 286 (6th Cir. 2005). Thus, the United States argued that there is a strong basis that the PREP Act is a complete preemption statute with respect to the administration or use of Covered Countermeasures by Covered Persons. 

The United States focused their argument on the interaction of two key provisions of the PREP Act, which demonstrate “its complete preemptive nature” that makes a claim federal and removable.

  • First, they noted that the Act provides immunity “under federal and state law with respect to all claims for loss caused by, arising out of, relating to, or resulting from the administration of countermeasures specified by the Secretary.” See 42 U.S.C. § 247d-6d(a)(1).
  • Secondly, the Act establishes, as the “sole exception” to the grant of immunity in subsection (a), “an exclusive Federal cause of action” for claims of willful misconduct resulting in death or serious physical injury. § 247d-6d(d)(1). The Act establishes as the “exclusive venue” for the excepted claims as “only before a three-judge panel of the United States District Court for the District of Columbia.” Id. § 247d-6d(e)(1), (e)(5). 

In tying these two provisions together, the United States argued that Congress determined that tort actions – at least in claims relating to the administration or use of Covered Countermeasures with respect to public health emergencies – are not necessary or appropriate to deter tortious conduct, intentional or negligent, except as provided in the “exclusive” federal cause of action created by the statute. 

Furthermore, the United States addresses in their Statement of Interest that a reading of the above PREP Act provisions as completely preemptive accords with the reasons Congress enacted the law. That is, that an effective response to national health emergencies “depends on the prompt and willing cooperation of private partners,” and thus, the deterrent and compensatory effects of liability arising in tort would effectively undermine the nation’s ability to protect itself from epidemics and pandemics. Therefore, such a balance supports Congress’s comprehensive statutory scheme in the PREP Act for developing and sustaining national pandemic responses, including the administration of medical countermeasures. 

Lastly, two cases that are routinely cited by defendants in fighting remand motions were cited by the United States in further support of their argument that the PREP Act provisions establish complete federal preemption. In In Re WTC Disaster Site Decision, 414 F.3d 352 (2nd Cir. 2005), the court found that, under the ATSSSA, the provisions provided complete federal preemption due to the inclusion of an “exclusive federal remedy” in the form of a federal cause of action, with an exclusive venue in the federal court system. Similarly, the U.S. Supreme Court in Beneficial National Bank, 539 U.S. at 9, held that the National Bank Act was completely preemptive due to the statute’s provision for an exclusive federal cause of action for state usury claims against national banks. Therefore, the Statement argues that since the PREP Act provides for an exclusive federal cause of action in a federal venue, the logic is identical to the two above-mentioned cases, and the PREP Act is completely preemptive. Finally, the United States distinguished a case to the contrary, Maglioli v. Andover Subacute Rehabilitation Center, No. 20-6605, 2020 WL 4671091 (D.N.J. 2020), which analyzed a different provision in the PREP Act under conflict preemption principles, and not complete preemption. 

The Statement of Interest filed by the U.S. government in the Tennessee nursing home case is important, specifically for analyzing federal jurisdiction in arguing immunity under the PREP Act for tort claims arising from the administration of public health countermeasures related to COVID-19. The Statement stresses the importance of having the federal courts decide themselves if the facts warrant a grant of immunity, rather than remanding the case to the state courts for the determination. 

Further, this Statement shows an interest of the United States government in trying to keep these cases in federal court. However, the arguments made by the United States in the Statement are not new – the significance of the Statement arises from the possibility of courts deferring to this Statement in ruling on pending motions to remand. So far, the HHS Secretary’s various legal opinions as well as the fourth amendment to the PREP Act declaration have not stopped federal courts from entering remand orders, so this Statement could be a great mechanism for courts to find a turning point.

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