Johnson v. Railroad Controls L P, 2:11-cv-01722

Background

Chad and Betty Johnson sued Railroad Controls (his employer), BNSF, and TNT after Chad Johnson was injured aboard a high-rail dump truck on BNSF tracks in Washington State on Sept. 26, 2010. Plaintiffs seek negligence damages, loss of consortium, and punitive damages.
Plaintiffs originally invoked federal-question jurisdiction under FELA and the Safety Appliances Act; they later amended to assert diversity jurisdiction and added Diversified Metal Fabricators, Inc. and Navistar, Inc.
Defendants moved to dismiss under Rule 12(b)(1) for lack of subject matter jurisdiction (arguing FELA does not apply because Johnson was not a railroad employee) and alternatively characterized arguments as Rule 12(b)(6) failures to state a claim.
Key disputed legal issue: whether Johnson qualifies as a railroad employee under FELA via the subservant/borrowed-employee/dual-servant theories (i.e., whether Railroad Controls was a servant of BNSF so that its employees are effectively BNSF employees).
The court found the Amended Complaint facially presented a federal question but also that diversity jurisdiction was properly alleged (complete diversity and $5,000,000 claimed), so the court denied dismissal for lack of subject matter jurisdiction in part.
On the merits of FELA applicability, the court granted defendants’ motions in part: FELA claims (including Mrs. Johnson’s FELA-based loss of consortium) were dismissed because facts indicate Railroad Controls retained control over its employees; state-law negligence claims survived 12(b)(6). Claims against TNT survived dismissal for now because plaintiffs pleaded general negligence allegations sufficient to be plausible.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether federal-question jurisdiction exists under FELA	Johnson was a railroad employee under FELA because Railroad Controls was a servant/subservant of BNSF	Johnson was not a railroad employee; Railroad Controls is not a common-carrier railroad so FELA does not apply	Court: Amended complaint presents a federal question on its face, but on the merits FELA does not apply—dismiss FELA claims under 12(b)(6) because Railroad Controls controlled employees
Whether court has subject-matter jurisdiction via diversity	Plaintiffs amended to plead complete diversity and >$75,000 amount in controversy ($5,000,000)	Defendants argued diversity wasn’t pleaded originally	Court: Diversity properly alleged; jurisdiction under 28 U.S.C. § 1332 is appropriate; 12(b)(1) challenge denied in part
Whether subservant/borrowed-servant theories support FELA coverage	Plaintiffs point to BNSF training, access cards, MWOR certification, on-site BNSF control elements as evidence of BNSF control	Defendants point to payroll, hiring, supervision, equipment supply, and day-to-day control remaining with Railroad Controls	Court: Evidence shows Railroad Controls retained hiring, supervision, pay, and equipment => analogous to Campbell; no subservant relationship found; FELA claims dismissed
Whether plaintiffs stated state-law negligence claims against defendants (including TNT)	Plaintiffs allege negligence in training, vehicle inspection, vehicle operation, and failure to warn; brake failure alleged	Defendants argue amended complaint lacks specific factual allegations against TNT and is conclusory	Court: Complaint sufficiently pleads plausible negligence claims; 12(b)(6) dismissal denied for state-law claims; TNT not dismissed at this stage

Key Cases Cited

Louisville & Nashville R. Co. v. Mottley, 211 U.S. 149 (federal-question jurisdiction follows the well-pleaded complaint rule)
Caterpillar Inc. v. Williams, 482 U.S. 386 (well-pleaded complaint rule governs federal-question jurisdiction)
Ashcroft v. Iqbal, 556 U.S. 662 (plausibility standard for pleading under Rule 8(a))
Kelley v. Southern Pacific Co., 419 U.S. 318 (tests for FELA employment; borrowed/dual-servant/subservant concepts)
Schmidt v. Burlington N. & Santa Fe Ry., 605 F.3d 686 (Ninth Circuit: factual indicators can support finding a railroad-servant relationship)
Campbell v. BNSF Ry., 600 F.3d 667 (Sixth Circuit: independent contractor retained control; no FELA coverage despite owner-imposed safety rules)
Hertz Corp. v. Friend, 559 U.S. 77 (definition of corporation's principal place of business for diversity jurisdiction)