Cosco Busan Free to Appeal Denial of Remand

SAN FRANCISCO (CN) - The owners of the ship that dumped thousands of gallons of oil into the San Francisco Bay can appeal a judge's refusal to remand a case accusing Longs Drugs of negligently providing pharmaceuticals to the captain, a federal judge ruled.

US District Judge Samuel Conti granted Regal Stone Limited's motion to appeal his March 2nd orderdenying the owner of the Cosco Busan's motion to remand the case to San Francisco County Superior Court.

Regal Stone claims Longs Drugs was negligent in providing pharmaceuticals to John Cota, who was captain of the Cosco Busan when it crashed into the Oakland-San Francisco Bay Bridge on a foggy morning in November 2007, dumping more than 53,000 gallons of oil into the bay.

In his earlier ruling, Conti agreed with Longs Drugs that it could remove the case to federal court even though it was never served the lawsuit.

Regal Stone Limited sued Longs Drugs in January 2011, under seal in San Francisco County Superior Court, under the theory that the pharmacist's negligence in providing prescription medication to Cota contributed to the collision.

The plaintiffs never served the defendants because they were waiting for the state court to rule on their motion to seal and to issue guidance on how to treat Cota's medical information.

The plaintiffs then filed the instant motion to remand, arguing that the defendants "improperly availed" themselves of the court's removal jurisdiction. They claimed the 30-day removal window opens upon service and before service removal is premature. Since they never served the defendants, the window never opened.

Conti agreed with Longs Drugs' argument that "removal is proper unless a forum defendant already has been 'properly joined and served.'"

In certifying the appeal Conti found the plaintiffs satisfied the requirements for interlocutory appeal.

According to the ruling, the order "involves a controlling question of law... The precise issue before the Court when it issued the Order was whether removal of a case from state court on diversity grounds was proper when a forum defendant had been properly joined but not served. Resolution of that issue on appeal will determine whether the litigation continues in the district court at all; hence, the question is 'controlling' for the purposes of 28 U.S.C. 1292 (b). Moreover, an immediate appeal of the order would materially advance the ultimate termination of the litigation in the sense that it would cede jurisdiction of this matter to the California state courts, effectively ending federal litigation of this case. Finally, the Court reviewed at length in the Order the substantial grounds for difference of opinion on the issue presented. Indeed, reviewing the district court cases, there is little but difference of opinion, and no appellate court has issued guidance."

The Court rejected Longs Drugs' characterization of the remanding order as "having done nothing more than applied the plain language of the statute," finding the statement "flirts with a serious mischaracterization of the Order, which emphasized the lack of clarity in the statutory language."

Conti also stayed all district court proceedings for the duration of the appeal.Cosco Busan owner Regal Stone Limited is joined by Fleet Management Ltd., technical manager of the ship, as plaintiffs.

They sued Longs Drugs under three corporate names along with parent company CVS Caremark and pharmacist Louie Chester.

The ship hit the Delta tower of the bridge, causing a 150-foot long, 12-foot high gash on the side of the ship and puncturing two of its fuel tanks, spilling 53,500 gallons of thick oil into the bay.

Officials say at least 2,000 migratory birds died, including endangered brown pelicans, marbled murrelets and Western grebes.

Cota pleaded guilty to federal water pollution charges in March 2009, and was sentenced to 10 months in prison, 1 year of supervised release and 200 hours of community service.

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