John Doe, I v. BJC Health System ( 2023 )

United States Court of Appeals
For the Eighth Circuit
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No. 23-1107
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John Doe, I, et al.
Plaintiffs - Appellees
v.
BJC Health System, doing business as BJC Healthcare
Defendant - Appellant
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Appeal from United States District Court
for the Eastern District of Missouri - St. Louis
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Submitted: September 20, 2023
Filed: December 28, 2023
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Before SMITH, Chief Judge, MELLOY and ERICKSON, Circuit Judges.
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SMITH, Chief Judge.
Plaintiffs brought this putative class action against BJC Health System (BJC)
in Missouri state court. They claim that, when they visited BJC’s online patient
portal to access electronic health records (EHRs), BJC shared their protected health
information (PHI) with third-party marketing services in violation of Missouri law.
After being sued in state court, BJC invoked the federal officer removal
statute, 28 U.S.C. § 1442(a)(1), and removed this case to federal court. BJC argues
that it is eligible for federal officer removal because, when it created and operated
its online patient portal, it acted under the United States Department of Health and
Human Services (HHS). The district court 1 rejected this argument and ordered
remand of this case to Missouri state court. BJC appeals the remand order. For the
reasons set forth in this opinion, we affirm.
I. Background
In 2009, Congress enacted the Health Information Technology for Economic
and Clinical Health (HITECH) Act. The Act established an Office of the National
Coordinator for Health Information Technology (Coordinator) within HHS.
42 U.S.C. § 300jj-11(a). The Act tasked the Coordinator “with the development of
a nationwide health information technology infrastructure that allows for the
electronic use and exchange of information.” Id. § 300jj-11(b). As described by
Congress, the Act aims to strengthen security of PHI, improve health outcomes,
reduce medical errors, lower costs, and facilitate greater coordination among
providers. Id.; see generally Kalle Deyette, Comment, HITECH Act: Building an
Infrastructure for Health Information Organizations and A New Health Care
Delivery System, 8 St. Louis U.J. Health L. & Pol’y 375 (2015) (describing the Act’s
health information technology goals).
Relevant here, the Act authorizes HHS to make “incentive payments” to
healthcare providers for their “adoption and meaningful use of certified EHR
technology.” 42 U.S.C. §§ 1395w-4(o), 1395ww(n); see also 42 C.F.R. §§ 495.2–
.370. These payments have been called the EHR Incentive Program, the Meaningful
Use Program, and the Promoting Interoperability Program. See, e.g., United States
ex rel. Sheldon v. Kettering Health Network, 816 F.3d 399, 409 (6th Cir. 2016);
Joseph D. Szerejko, Note, Reading Between the Lines of Electronic Health Records:
The Health Information Technology for Economic and Clinical Health Act and Its
Implications for Health Care Fraud and Information Security, 47 Conn. L. Rev.
1The Honorable Rodney W. Sippel, United States District Judge for the
Eastern District of Missouri.
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1103, 1108 (2015); Doe, I v. BJC Health Sys., No. 4:22-cv-919-RWS, 2023 WL
369427, at *2 (E.D. Mo. Jan. 10, 2023).
In 2013, BJC created an online portal for its patients. The portal was initially
called MyBJCHealth and renamed MyChart in 2017. The portal allows BJC patients
to go online and access EHRs, such as medical test results, and communicate with
BJC personnel, such as physicians and nurses. HHS gave BJC incentive payments
for creating and operating this portal.
In 2022, plaintiffs filed this putative class action against BJC in Missouri state
court. They are or were BJC patients who claim that BJC violated their medical
privacy rights under Missouri law. Specifically, plaintiffs allege that, when patients
visited MyBJCHealth or MyChart, the portal shared their PHI with third-party
services, including Alphabet (Google) and Meta Platforms (Facebook), which used
the information for targeted online advertising. BJC acknowledges that its portal
shared information with third parties, but it describes the information as
depersonalized and unprotected “metadata.” The nature of the information is not
pertinent in this appeal.
BJC timely removed this case from state court to federal court under the
federal officer removal statute. 28 U.S.C. § 1442(a)(1). In the district court, BJC
argued that, when it created and operated the portal, it acted under HHS’s or the
Coordinator’s authority. Plaintiffs moved for remand to state court, and the district
court granted their motion. BJC now appeals the remand order.
II. Discussion
We have jurisdiction under 28 U.S.C. § 1447(d). “We review a district court’s
grant of a motion to remand—and related questions of statutory interpretation—de
novo.” Buljic v. Tyson Foods, Inc., 22 F.4th 730, 738 (8th Cir. 2021).
This case focuses on the federal officer removal statute. 28 U.S.C. § 1442(a).
The statute provides the federal government, federal agencies, federal officers, and
persons “acting under” federal officers the right to remove from state court to federal
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court certain civil actions and criminal prosecutions brought against them. Id. The
statute is “an incident of federal supremacy.” Willingham v. Morgan, 395 U.S. 402,
405 (1969); see U.S. Const. art. VI, cl. 2 (Supremacy Clause). Its principal purpose
is to afford the designated classes of defendants “the protection of a federal forum”
when they incur or potentially incur liability under state law for performing “their
duty to enforce federal law.” Willingham, 395 U.S. at 407. The statute is “an
exception to the well-pleaded complaint rule.” Buljic, 22 F.4th at 738 (internal
quotation marks omitted). It should be “liberally construed, and thus the typical
presumption against removal does not apply.” Id. (internal quotation marks omitted).
“When the removing party is not itself a federal officer or agency,” it must
make a “threshold showing” that (1) it is a “person” under the statute, (2) it “acted
under the direction of a federal officer,” (3) a “causal connection” exists between its
complained-of conduct and official federal authority, and (4) it has a “colorable
federal defense” to the claim or claims against it. Id.; see also Cagle v. NHC
Healthcare-Md. Heights, LLC, 78 F.4th 1061, 1068 (8th Cir. 2023); Minnesota v.
Am. Petroleum Inst., 63 F.4th 703, 714 (8th Cir. 2023); Graves v. 3M Co., 17 F.4th
764, 768–69 (8th Cir. 2021); Jacks v. Meridian Res. Co., 701 F.3d 1224, 1230 (8th
Cir. 2012), abrogated on other grounds by BP P.L.C. v. Mayor & City Council of
Balt., 141 S. Ct. 1532, 1538 (2021). All four elements must be present. The absence
of any element will defeat removal from state to federal court.
It is undisputed that BJC is not itself a federal officer or agency and that BJC
is a person under the federal officer removal statute. Instead, this case focuses on
whether BJC acted under the direction of HHS or the Coordinator when it created
and operated MyBJCHealth or MyChart, accepted federal incentive payments, and
potentially incurred liability under Missouri law. This case turns on the meaning of
the phrase “acting under” in the statute. See 28 U.S.C. § 1442(a)(1) (referring to “any
person acting under that officer” (emphasis added)).
A. Recent Case Law
Our construction of the statute’s “acting under” element begins with Watson
v. Philip Morris Cos., 551 U.S. 142 (2007). In Watson, plaintiffs sued the cigarette
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manufacturer Philip Morris in Arkansas state court. They claimed that Philip
Morris’s branding and marketing of certain cigarettes as “light” were “deceptive and
misleading under Arkansas law.” Id. at 146 (internal quotation marks omitted).
Philip Morris removed the case to federal court. It argued that it acted under the
Federal Trade Commission (FTC) when it followed government methods and
processes, tested cigarettes for their tar and nicotine content, and labeled low-level
cigarettes as “light.” Id. at 146–47, 154–56. The Supreme Court rejected this
argument, holding that Philip Morris was a mere private entity. Id. at 157.
Importantly, the Court emphasized that the federal officer removal statute is
“not limitless.” Id. at 147. When a court applies the statute, it must consider the
“language, context, history, and purposes.” Id. A business that simply follows
federal law, even highly detailed and complex regulations, does not act under a
federal officer. Id. at 151–53. The “relevant relationship” that must exist “typically
involves subjection, guidance, or control.” Id. at 151 (internal quotation marks
omitted). It “must involve an effort to assist, or to help carry out, the duties or tasks
of the federal superior.” Id. at 152 (emphasis omitted).
According to the Court, Philip Morris’s argument for removal failed on the
“acting under” element because there was “no evidence of any delegation of legal
authority from the FTC.” Id. at 156. When Philip Morris tested cigarettes for tar and
nicotine content, it did not “undertake testing on the Government agency’s behalf.”
Id. It acted on its own behalf and for its own business purposes.
In Jacks, we addressed a lawsuit between a plaintiff and her health insurer,
Blue Cross Blue Shield–Kansas City (BCBS). 701 F.3d 1224. The plaintiff sued
BCBS in state court, alleging violations of Missouri law. Id. at 1227–28. BCBS
removed the case to federal court, observing that it insured the plaintiff through the
Federal Employees Health Benefits (FEHB) program. Id. We held that removal was
proper because, when a health insurer participates in the FEHB program, it “is
helping the government to produce an item that it needs—the basic governmental
task of providing health benefits for its employees.” Id. at 1234. The health insurer
acts as a sort of middleman. It delivers federal benefits to federal beneficiaries. See
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also Trinity Home Dialysis, Inc. v. WellMed Networks, Inc., No. 22-10414, 2023 WL
2573914, at *3–4 (5th Cir. Mar. 20, 2023) (unpublished per curiam) (allowing
Medicare Advantage Organizations to remove cases from state court to federal
court).
In recent years, we have decided several more cases on federal officer
removal. The common analytical thread running through these cases is some basic
governmental task. In Graves, plaintiffs who had served in civilian and military roles
sued 3M for auditory damage they suffered after using 3M earplugs. 17 F.4th at 767.
We held that the civilian cases were not removable because 3M did not show that it
“was carrying out or assisting in the government’s duties.” Id. at 770. However, 3M
could remove military cases, where the military obtained the earplugs, “developed
its own instructions” for using them, and distributed them to plaintiffs. Id. at 770,
773.
In Buljic, survivors of meat processing workers who contracted and died from
COVID-19, at the beginning of the COVID-19 pandemic, sued the workers’ former
employer, Tyson Foods (Tyson), for fraudulent misrepresentation and gross
negligence. 22 F.4th at 734. Tyson removed the case to federal court. Id. Tyson
argued that it was “critical infrastructure” and had worked closely with the President
and the United States Department of Agriculture to supply essential foods to
Americans during the pandemic’s early stages. Id. at 734–40. We rejected this
argument. Id. at 742. Although meat processing is critical to the national economy
and general welfare, “the fact that an industry is considered critical does not
necessarily mean that every entity within it fulfills a basic governmental task or that
workers within that industry are acting under the direction of federal officers.” Id. at
740. “[W]hile the federal government may have an interest in ensuring a stable food
supply, it is not typically the duty or task of the federal government to process meat
for commercial consumption.” Id. (cleaned up). Cooperation with and
encouragement from the federal government, alone, are insufficient to support
federal officer removal. Id. at 741; see also Glenn v. Tyson Foods, Inc., 40 F.4th
230, 236 (5th Cir. 2022) (“Packaging and processing poultry has always been a
private task—not a governmental one.”); Cagle, 78 F.4th at 1068 (holding that a
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nursing home, notwithstanding its “critical infrastructure” designation, was not
entitled to remove a COVID-19 suit from state to federal court).
In American Petroleum Institute, the State of Minnesota sued fossil fuel
producers in state court, alleging harms to the environment. 63 F.4th at 707–08. The
fossil fuel producers removed to federal court, but the district court ordered remand,
and we affirmed. Id. at 708. Analyzing the “acting under” and “causal connection”
elements together, we held that military fuel production, federal offshore leases, and
participation in the Strategic Petroleum Reserve did not make the case removable.
Id. at 714–16 & n.12. Minnesota’s suit did not focus on these activities but on how
fossil fuel producers “conducted their marketing activities to the general public.” Id.
at 715. A business’s interactions with the general public do not normally establish a
ground for removal.
From the Supreme Court decision in Watson and from our own decisions in
Jacks, Graves, Buljic, and American Petroleum Institute, we conclude that a party
acts under a federal officer, within the meaning of the federal officer removal statute,
only when it performs a “basic governmental task[].” Watson, 551 U.S. at 153;
Jacks, 701 F.3d at 1231–32, 1234; Graves, 17 F.4th at 769; Buljic, 22 F.4th at 738–
42. A basic governmental task involves a “delegation of legal authority” from a
federal entity. Watson, 551 U.S. at 156; see also Jacks, 701 F.3d at 1233–34. In other
words, the party acts on the government’s behalf. Watson, 551 U.S. at 156. It
performs or helps the government perform federal duties. Id. at 152; Graves, 17
F.4th at 770. The party does the business of the federal government and not merely
its own. 2
2
The Supreme Court compares the “special relationship” between a federal
officer and a subordinate to the relationship between a principal and an agent at
common law. Watson, 551 U.S. at 156–57; see Restatement (Third) of Agency
§ 1.01 (Am. L. Inst. 2006) (“Agency is the fiduciary relationship that arises when
one person (a ‘principal’) manifests assent to another person (an ‘agent’) that the
agent shall act on the principal’s behalf and subject to the principal’s control, and
the agent manifests assent or otherwise consents so to act.”); Restatement (Second)
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The classic example of a person who acts under a federal officer is a
government contractor. Watson, 551 U.S. at 153; Jacks, 701 F.3d at 1231–32; Papp
v. Fore-Kast Sales Co., 842 F.3d 805, 812 (3d Cir. 2016). Federal courts have often
held that parties may invoke the statute and remove cases when they “provided the
government with a product that it needed or performed a job that the government
would otherwise have to perform.” Buljic, 22 F.4th at 739; see also Jacks, 701 F.3d
at 1234. Looking to our sister circuits, parties might also qualify for removal when
they functioned in practice as “instrumentalities of the United States.” Butler v.
Coast Elec. Power Ass’n, 926 F.3d 190, 201 (5th Cir. 2019) (quoting Ala. Power
Co. v. Ala. Elec. Coop., Inc., 394 F.2d 672, 677 (5th Cir. 1968)); Cessna v. REA
Energy Coop., Inc., 753 F. App’x 124, 127 (3d Cir. 2018) (unpublished) (same);
Caver v. Cent. Ala. Elec. Coop., 845 F.3d 1135, 1143 (11th Cir. 2017) (same).
Under the classic example, the federal government has explicitly delegated its
authority to a government contractor. Under the latter example of our sister circuits,
the federal government has implicitly delegated its authority. It has tacitly allowed a
private entity “to provide a public function conceived of and directed by the federal
government.” Caver, 845 F.3d at 1144. But see Watson, 551 U.S. at 157 (“[N]either
Congress nor federal agencies normally delegate legal authority to private entities
without saying that they are doing so.” (emphasis added)).
of Agency § 1(1) (Am. L. Inst. 1958) (“Agency is the fiduciary relation which results
from the manifestation of consent by one person to another that the other shall act
on his behalf and subject to his control, and consent by the other so to act.”). In a
strict sense, we do not believe parties qualified to remove their cases will always be
agents, but their relationships to federal officers will usually bear many of the same
hallmarks. See Watson, 551 U.S. at 151 (“[T]he word ‘under’ must refer to what has
been described as a relationship that involves ‘acting in a certain capacity,
considered in relation to one holding a superior position or office.’ That relationship
typically involves ‘subjection, guidance, or control.’” (citations omitted)).
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B. Application to MyBJCHealth
In this case, BJC argues both explicit and implicit delegation. It contends that
it exercised explicit or implied authority delegated from HHS or the Coordinator
when it created and operated its online patient portal—MyBJCHealth or MyChart.
In support of its argument, BJC cites two district courts from outside this circuit. See
Doe I v. UPMC, No. 2:20-cv-359, 2020 WL 4381675 (W.D. Pa. July 31, 2020); Doe
v. ProMedica Health Sys., Inc., No. 3:20-cv-1581, 2020 WL 7705627 (N.D. Ohio
Oct. 30, 2020). A court of appeals does not ordinarily spend its time parsing the
orders of out-of-circuit district courts. See RLJCS Enters., Inc. v. Pro. Benefit Tr.
Multiple Emp. Welfare Benefit Plan & Tr., 487 F.3d 494, 499 (7th Cir. 2007). But
given BJC’s reliance on those two orders, we will briefly address them here.
In UPMC, a district court concluded that a healthcare provider could remove
a medical privacy suit from state to federal court based on its participation in HHS’s
incentive program. 2020 WL 4381675, at *7. The court reasoned that, when
healthcare providers create and maintain patient portals and accept HHS incentive
payments, they assist HHS in building “an interoperable health information
technology infrastructure.” Id. at *5 (internal quotation marks omitted). Their
“voluntary participation in implementing a nationwide EHR network shows [a]
relationship . . . like the government contractor relationship.” Id. at *6.
Similarly, in ProMedica, a district court concluded that a healthcare provider
could remove a medical privacy suit to federal court. 2020 WL 7705627, at *3. The
court reasoned that, when healthcare providers participate in the HHS program, they
“assist the federal government in its mission for a nationwide system of electronic
health records” or help HHS “create a unified system of patient electronic health
records,” as with “a government-contractor relationship.” Id. at *2–3.
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We find these orders—and BJC’s argument based on them—unpersuasive.3
To show that it acted under a federal officer as a government contractor, a party
seeking removal must have “provided the government with a product that it needed
or performed a job that the government would otherwise have to perform.” Buljic,
22 F.4th at 739; see also Watson, 551 U.S. at 154 (“[A party] at least arguably . . .
performed a job that, in the absence of a contract with a private firm, the Government
itself would have had to perform.”). Parties who act as government middlemen and
deliver federal benefits to federal beneficiaries will usually be able to make this
showing. See, e.g., Jacks, 701 F.3d at 1234 (FEHB); Trinity, 2023 WL 2573914, at
*4 (Medicare Advantage). Parties “merely doing business in a highly regulated
arena” will not, even if they accept government subsidies. See Jacks, 701 F.3d at
1234. “[T]he receipt of federal funding alone cannot establish a delegation of legal
authority . . . .” Mays v. City of Flint, 871 F.3d 437, 444 (6th Cir. 2017).
The line between a party who acts as a government middleman and a party
who accepts federal funding for its own business purposes may sometimes be blurry.
Wherever the line may lie, BJC clearly sits on the private side. MyBJCHealth or
MyChart was not a federal government website, it was not a website BJC operated
on the federal government’s behalf or for the federal government’s benefit, and it
was not a website the federal government directed BJC to create or operate. The
design of private websites is not—and has never been—a basic governmental task.
When BJC created and operated an online portal for its patients, it was not doing the
federal government’s business. It was doing its own.
This case resembles Buljic and American Petroleum Institute. In Buljic, a meat
processor argued that it qualified for federal officer removal because it was “critical
infrastructure” in the nation’s food system. We rejected that argument. See Buljic,
22 F.4th at 739 (“Tyson conflates the federal government’s designation of the ‘food
and agriculture’ sector as critical infrastructure with a finding that Tyson was
3
Likewise, we have reviewed, but do not base our decision on, the contrary
district court orders that plaintiffs have compiled. See RLJCS, 487 F.3d at 499.
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fulfilling a basic governmental task.”). And in American Petroleum Institute, fossil
fuel producers argued that they qualified for federal officer removal because of their
“production of military-grade fuel, operation of federal oil leases, and participation
in strategic energy infrastructure.” 63 F.4th at 715. We rejected that argument as
well. Id. at 716 & n.12. Here, the argument that BJC participates in a nationwide
health records system—or an HHS effort to build a nationwide health records
system—is also unconvincing. “[BJC] conflates the federal government’s
designation of [EHR technology as important] with a finding that [BJC] was
fulfilling a basic governmental task.” Buljic, 22 F.4th at 739. It was not.
Meat processors, fossil fuel producers, and healthcare providers all engage in
business activities that are important and in which the federal government and the
public are deeply interested, but this importance and interest do not bring any of
them within the scope of the federal officer removal statute. 28 U.S.C. § 1442(a)(1).
Parties must show that the federal government delegated its own duties to them—
duties that are essentially governmental. See Watson, 551 U.S. at 152 (“[P]recedent
and statutory purpose make clear that the private person’s ‘acting under’ must
involve an effort to assist, or to help carry out, the duties or tasks of the federal
superior.” (emphasis omitted)); id. at 153 (“The assistance that private contractors
provide federal officers goes beyond simple compliance with the law and helps
officers fulfill other basic governmental tasks.”). BJC showed that HHS endorses
online patient portals, and HHS has provided subsidies for them. BJC has not shown
that it performed a basic task or duty of the federal government.
This case is readily distinguishable from Jacks and Graves. In Jacks, we
allowed a health insurer that participated in the FEHB program to remove a case to
federal court. 701 F.3d 1224. The FEHB program provides health insurance to
federal employees and their families, and we recognized that health insurance is an
item the government needs “so as to compete for the best talent along with private
companies.” Id. at 1232–34. And in Graves, we allowed some cases to be removed—
and not others—based on whether plaintiffs had received their earplugs through the
military or the private sector. 17 F.4th at 770, 773. Here, BJC was not supplying the
federal civilian workforce or the military with a necessary item, such as health
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insurance or earplugs. BJC’s portal was a private website. It was a way for patients
and BJC personnel to access EHRs and communicate with one another. Apart from
being subsidized by HHS, the portal had nothing to do with the federal government’s
operations or duties. See Mays, 871 F.3d at 444.
For similar reasons, we reject the view that MyBJCHealth or MyChart was an
instance of implied delegated authority. This circuit has not adopted the view of the
Third, Fifth, and Eleventh Circuits that an implied delegation can establish a basis
for federal officer removal. But even if we accepted this theory today, we do not
believe BJC would qualify. Our sister circuits have emphasized that an implied
delegation exists when a private party functions in practice as an “instrumentalit[y]
of the United States.” Butler, 926 F.3d at 201; Cessna, 753 F. App’x at 127; Caver,
845 F.3d at 1143.4 Here, there is no indication that BJC practically functioned as a
federal instrumentality or that its patients ever believed they were dealing with an
entity acting in place of the federal government. The creation and operation of an
online patient portal is not “a public function” that the federal government tacitly
allowed BJC to perform on its behalf. Caver, 845 F.3d at 1144. MyBJCHealth or
MyChart was simply a private website, whose existence has served (or perhaps
violated) the interests of BJC, its personnel, and its patients.
In sum, the creation and operation of an online patient portal is not a basic
governmental task. When BJC created and operated MyBJCHealth or MyChart, it
did not act pursuant to an explicit or implied “delegation of legal authority” from
HHS, the Coordinator, or any other federal officer. Watson, 551 U.S. at 156. BJC
4
Cf. Restatement (Third) of Agency § 2.03 (Am. L. Inst. 2006) (“Apparent
authority is the power held by an agent or other actor to affect a principal’s legal
relations with third parties when a third party reasonably believes the actor has
authority to act on behalf of the principal and that belief is traceable to the principal’s
manifestations.”); Restatement (Second) of Agency § 8 (Am. L. Inst. 1958)
(“Apparent authority is the power to affect the legal relations of another person by
transactions with third persons, professedly as agent for the other, arising from and
in accordance with the other’s manifestations to such third persons.”).
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was not a government contractor, and it did not function in practice as a federal
instrumentality. It made a private website and received a federal subsidy. This is
insufficient for removing a case under 28 U.S.C. § 1442(a)(1).
C. Remaining Elements
Because BJC did not act under a federal officer when it created and operated
its online patient portal and accepted HHS incentive payments, we need not address
the causal connection and colorable federal defense elements. See Buljic, 22 F.4th at
742 (“[W]e need not reach the remaining elements of the statute.”).
III. Conclusion
We affirm the order remanding this case to Missouri state court.
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