NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT ______________
No. 23-2882 ______________
DONNA CHEESMAN
v.
CAPITAL HEALTH SYSTEM INC, DBA Capital Health, Appellant ______________
On Appeal from the United States District Court for the District of New Jersey (D.C. No. 3:23-cv-01247) U.S. District Judge: Honorable Zahid N. Quraishi ______________
No. 23-3049 ______________
HILLARY BARNETT
VALLEY HEALTH SYSTEM, INC. doing business as The Valley Hospital, Inc., doing business as Valley Home Care, Inc., doing business as Valley Medical Group, Appellant ______________
On Appeal from the United States District Court for the District of New Jersey (D.C. No. 2:23-cv-00185) U.S. District Judge: Honorable Evelyn Padin ______________
Submitted Under Third Circuit L.A.R. 34.1(a) March 13, 2025 ______________
Before: SHWARTZ, KRAUSE, and CHUNG, Circuit Judges.
(Filed: March 19, 2025) ______________
OPINION* ______________
SHWARTZ, Circuit Judge.
In this consolidated appeal, Capital Health System Inc. and Valley Health System
Inc. challenge the remand of cases they had removed to federal court based upon the
federal officer removal statute, 28 U.S.C. § 1442(a)(1), and, in Valley Health’s case, also
based on the Class Action Fairness Act (“CAFA”), id. §§ 1332(d), 1453, 1711-15.
Because removal was improper on either ground, we will affirm.
I
Capital Health and Valley Health are New Jersey hospital systems with websites
that allow visitors, among other things, to book appointments, find doctors, research
treatments, and investigate accepted insurance. While using these website features, users
were sometimes required to input personal health data. The websites had “automatic
rerouting mechanisms,” CA47 ¶ 18, that disclosed users’ data to third parties such as
* This disposition is not an opinion of the full Court and, pursuant to I.O.P. 5.7, does not constitute binding precedent. 2 Facebook, id. ¶¶ 18-20; VA52 ¶ 4.1 Facebook in turn used that data to target digital
advertisements at those users across its platforms.
Hillary Barnett and Donna Cheesman are Valley Health and Capital Health
patients, respectively, and New Jersey citizens. Each sued their hospital in the New
Jersey Superior Court on their own behalf and on behalf of a putative class,2 alleging that
the hospitals’ disclosure of their personal health information to Facebook violated their
privacy rights under New Jersey law. Valley Health and Capital Health removed the
cases to the United States District Court for the District of New Jersey, asserting that the
federal officer removal statute supported removal. Valley Health also relied on CAFA as
a basis for removal.
Both plaintiffs filed motions to remand, which the District Courts granted. Doe v.
Valley Health Sys., Inc., No. 2:23-cv-00185, 2023 WL 6997301, at *2-4 (D.N.J. Oct. 24,
2023) (Padin, J.); Doe v. Capital Health Sys., Inc., No. 3:23-cv-01247, 2023 U.S. Dist.
LEXIS 167393, at *16 (D.N.J. Sept. 19, 2023) (Quraishi, J.). In each case, the District
Court held that the hospital’s voluntary participation in a federal program that
1 “VA” refers to the appendix filed by Valley Health in appeal number 23-3049; “CA” refers to Capital Health’s appendix filed in appeal number 23-2882. 2 Barnett’s proposed class includes, [d]uring the fullest period allowed by law, all New Jersey citizens who are, or were, patients of Valley Health System, Inc. or any of its affiliates and who exchanged communications at [Valley Health]’s websites . . . that caused disclosures of patient personally identifiable information and communications to third parties, including (but not limited to) Facebook. VA86 ¶ 150. Cheesman defines her proposed class almost identically. CA85 ¶ 170. 3 incentivized the creation and use of electronic health record systems3 did not mean they
were “acting under” the United States, its agencies, or its officers, as required for federal
officer removal. Valley Health, 2023 WL 6997301, at *2-4; Capital Health, 2023 U.S.
Dist. LEXIS 167393, at *15. In Valley Health, the Court further held that it lacked
jurisdiction under CAFA because Valley Health failed to demonstrate that the parties’
citizenship was at least minimally diverse. Valley Health, 2023 WL 6997301, at *5-6.
Valley Health and Capital Health appeal.
II4
The District Courts correctly held that removal under the federal officer removal
statute and, in the case of Valley Health, under CAFA, was improper.
A
3 The Health Information Technology for Economic and Clinical Health Act (“HITECH Act”), Pub. L. No. 111-5, §§ 13001-13424, 123 Stat. 115, 226-79 (2009), seeks, among other things, to encourage healthcare providers to implement electronic health records systems. See 42 U.S.C. §§ 300jj-11(b), 300jj-31. Providers who adopt such technology receive incentive payments from the Government, id. § 1395w-4(o), while those who fail to adopt them receive reduced reimbursement payments for Medicare services, id. § 1395w-4(a)(7). The HITECH Act thus does not require providers to adopt these digital systems but financially incentivizes them to do so. See id. § 1395w-4. 4 Upon removal, the District Courts “had the obligation and power to determine [their] own jurisdiction.” Mohr v. Trs. of Univ. of Pa., 93 F.4th 100, 104 (3d Cir. 2024). We have jurisdiction to review those determinations under 28 U.S.C. §§ 1291 and 1447(d). Our authority under § 1447(d) to review the orders remanding these actions extends to all grounds raised for removal. See BP P.L.C. v. Mayor & City Council of Balt., 141 S. Ct. 1532, 1538 (2021). We review a district court’s decision to remand for lack of subject matter jurisdiction de novo. Maglioli v. All. HC Holdings LLC, 16 F.4th 393, 403 (3d Cir. 2021). 4 The federal officer removal statute, 28 U.S.C. § 1442(a)(1), allows certain officers
of the United States and “private persons who lawfully assist a federal officer in the
performance of his official duty” to remove state court actions against them to federal
court. Mohr v. Trs. of Univ. of Pa., 93 F.4th 100, 104 (3d Cir. 2024) (alteration omitted)
(quoting Watson v. Philip Morris Cos., 551 U.S. 142, 151 (2007)). To remove an action
under the statute, defendants must establish that (1) they are “a ‘person’ within the
meaning of the statute”; (2) the plaintiff’s claims are “based upon the defendant ‘acting
under’ the United States, its agencies, or its officers”; (3) the plaintiff’s claims are “‘for
or relating to’ an act under color of federal office”; and (4) they “raise a colorable federal
defense to the plaintiff’s claims.” Id. (quoting Maglioli v. All. HC Holdings LLC, 16
F.4th 393, 404 (3d Cir. 2021)).
Valley Health and Capital Health mistakenly assert that their cases are removable
because the plaintiffs’ claims arise from their compliance with the HITECH Act’s
incentive program promoting the adoption of electronic health records systems. In Mohr
v.
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT ______________
No. 23-2882 ______________
DONNA CHEESMAN
v.
CAPITAL HEALTH SYSTEM INC, DBA Capital Health, Appellant ______________
On Appeal from the United States District Court for the District of New Jersey (D.C. No. 3:23-cv-01247) U.S. District Judge: Honorable Zahid N. Quraishi ______________
No. 23-3049 ______________
HILLARY BARNETT
VALLEY HEALTH SYSTEM, INC. doing business as The Valley Hospital, Inc., doing business as Valley Home Care, Inc., doing business as Valley Medical Group, Appellant ______________
On Appeal from the United States District Court for the District of New Jersey (D.C. No. 2:23-cv-00185) U.S. District Judge: Honorable Evelyn Padin ______________
Submitted Under Third Circuit L.A.R. 34.1(a) March 13, 2025 ______________
Before: SHWARTZ, KRAUSE, and CHUNG, Circuit Judges.
(Filed: March 19, 2025) ______________
OPINION* ______________
SHWARTZ, Circuit Judge.
In this consolidated appeal, Capital Health System Inc. and Valley Health System
Inc. challenge the remand of cases they had removed to federal court based upon the
federal officer removal statute, 28 U.S.C. § 1442(a)(1), and, in Valley Health’s case, also
based on the Class Action Fairness Act (“CAFA”), id. §§ 1332(d), 1453, 1711-15.
Because removal was improper on either ground, we will affirm.
I
Capital Health and Valley Health are New Jersey hospital systems with websites
that allow visitors, among other things, to book appointments, find doctors, research
treatments, and investigate accepted insurance. While using these website features, users
were sometimes required to input personal health data. The websites had “automatic
rerouting mechanisms,” CA47 ¶ 18, that disclosed users’ data to third parties such as
* This disposition is not an opinion of the full Court and, pursuant to I.O.P. 5.7, does not constitute binding precedent. 2 Facebook, id. ¶¶ 18-20; VA52 ¶ 4.1 Facebook in turn used that data to target digital
advertisements at those users across its platforms.
Hillary Barnett and Donna Cheesman are Valley Health and Capital Health
patients, respectively, and New Jersey citizens. Each sued their hospital in the New
Jersey Superior Court on their own behalf and on behalf of a putative class,2 alleging that
the hospitals’ disclosure of their personal health information to Facebook violated their
privacy rights under New Jersey law. Valley Health and Capital Health removed the
cases to the United States District Court for the District of New Jersey, asserting that the
federal officer removal statute supported removal. Valley Health also relied on CAFA as
a basis for removal.
Both plaintiffs filed motions to remand, which the District Courts granted. Doe v.
Valley Health Sys., Inc., No. 2:23-cv-00185, 2023 WL 6997301, at *2-4 (D.N.J. Oct. 24,
2023) (Padin, J.); Doe v. Capital Health Sys., Inc., No. 3:23-cv-01247, 2023 U.S. Dist.
LEXIS 167393, at *16 (D.N.J. Sept. 19, 2023) (Quraishi, J.). In each case, the District
Court held that the hospital’s voluntary participation in a federal program that
1 “VA” refers to the appendix filed by Valley Health in appeal number 23-3049; “CA” refers to Capital Health’s appendix filed in appeal number 23-2882. 2 Barnett’s proposed class includes, [d]uring the fullest period allowed by law, all New Jersey citizens who are, or were, patients of Valley Health System, Inc. or any of its affiliates and who exchanged communications at [Valley Health]’s websites . . . that caused disclosures of patient personally identifiable information and communications to third parties, including (but not limited to) Facebook. VA86 ¶ 150. Cheesman defines her proposed class almost identically. CA85 ¶ 170. 3 incentivized the creation and use of electronic health record systems3 did not mean they
were “acting under” the United States, its agencies, or its officers, as required for federal
officer removal. Valley Health, 2023 WL 6997301, at *2-4; Capital Health, 2023 U.S.
Dist. LEXIS 167393, at *15. In Valley Health, the Court further held that it lacked
jurisdiction under CAFA because Valley Health failed to demonstrate that the parties’
citizenship was at least minimally diverse. Valley Health, 2023 WL 6997301, at *5-6.
Valley Health and Capital Health appeal.
II4
The District Courts correctly held that removal under the federal officer removal
statute and, in the case of Valley Health, under CAFA, was improper.
A
3 The Health Information Technology for Economic and Clinical Health Act (“HITECH Act”), Pub. L. No. 111-5, §§ 13001-13424, 123 Stat. 115, 226-79 (2009), seeks, among other things, to encourage healthcare providers to implement electronic health records systems. See 42 U.S.C. §§ 300jj-11(b), 300jj-31. Providers who adopt such technology receive incentive payments from the Government, id. § 1395w-4(o), while those who fail to adopt them receive reduced reimbursement payments for Medicare services, id. § 1395w-4(a)(7). The HITECH Act thus does not require providers to adopt these digital systems but financially incentivizes them to do so. See id. § 1395w-4. 4 Upon removal, the District Courts “had the obligation and power to determine [their] own jurisdiction.” Mohr v. Trs. of Univ. of Pa., 93 F.4th 100, 104 (3d Cir. 2024). We have jurisdiction to review those determinations under 28 U.S.C. §§ 1291 and 1447(d). Our authority under § 1447(d) to review the orders remanding these actions extends to all grounds raised for removal. See BP P.L.C. v. Mayor & City Council of Balt., 141 S. Ct. 1532, 1538 (2021). We review a district court’s decision to remand for lack of subject matter jurisdiction de novo. Maglioli v. All. HC Holdings LLC, 16 F.4th 393, 403 (3d Cir. 2021). 4 The federal officer removal statute, 28 U.S.C. § 1442(a)(1), allows certain officers
of the United States and “private persons who lawfully assist a federal officer in the
performance of his official duty” to remove state court actions against them to federal
court. Mohr v. Trs. of Univ. of Pa., 93 F.4th 100, 104 (3d Cir. 2024) (alteration omitted)
(quoting Watson v. Philip Morris Cos., 551 U.S. 142, 151 (2007)). To remove an action
under the statute, defendants must establish that (1) they are “a ‘person’ within the
meaning of the statute”; (2) the plaintiff’s claims are “based upon the defendant ‘acting
under’ the United States, its agencies, or its officers”; (3) the plaintiff’s claims are “‘for
or relating to’ an act under color of federal office”; and (4) they “raise a colorable federal
defense to the plaintiff’s claims.” Id. (quoting Maglioli v. All. HC Holdings LLC, 16
F.4th 393, 404 (3d Cir. 2021)).
Valley Health and Capital Health mistakenly assert that their cases are removable
because the plaintiffs’ claims arise from their compliance with the HITECH Act’s
incentive program promoting the adoption of electronic health records systems. In Mohr
v. Trustees of the University of Pennsylvania, 93 F.4th 100 (3d Cir. 2024), we explained
that one does not “‘act[] under’ the United States, its agencies, or its officers,” simply by
participating in the HITECH Act’s incentive program. Id. at 105-06.5 Thus, the federal
officer removal statute does not provide a basis for removal of these state court actions,
and the District Courts properly remanded them.
5 Valley Health appears to concede that Mohr governs. 5 B
Valley Health’s alternative argument that its case is removable under CAFA also
fails. Under CAFA, “federal courts have jurisdiction over class actions in which [(1)] the
amount in controversy exceeds $5,000,000 in the aggregate, [(2)] any class member and
any defendant are citizens of different states, and [(3)] there are at least 100 members in
the putative class.” Kaufman v. Allstate N.J. Ins. Co., 561 F.3d 144, 149 (3d Cir. 2009)
(citations omitted).
Here, Valley Health fails to satisfy element two because it cannot show there is
minimal diversity of citizenship among the parties, which is necessary for CAFA
jurisdiction. Id.; see also 28 U.S.C. § 1441(a) (providing that “any civil action brought in
a State court of which the district courts of the United States have original jurisdiction,
may be removed by the defendant” to the appropriate district court). According to the
complaint, both Valley Health and Barnett are New Jersey citizens and Barnett’s
proposed class consists of,
[d]uring the fullest period allowed by law, all New Jersey citizens who are, or were, patients of Valley Health System, Inc. or any of its affiliates and who exchanged communications at [Valley Health]’s websites . . . that caused disclosures of patient personally identifiable information and communications to third parties, including (but not limited to) Facebook.
VA86 ¶ 150.
Valley Health argues that because Barnett did not “circumscribe her class
temporally,” she included putative class members who had since become citizens of other
states. Valley Opening Br. 43. It is mistaken. We determine “[c]itizenship of the 6 members of the proposed plaintiff classes . . . as of the date of filing of the complaint.”
28 U.S.C. § 1332(d)(7). Therefore, any Valley Health patient who was once a New
Jersey citizen but took up citizenship elsewhere by the time the complaint was filed is
necessarily excluded from the proposed class. Doe v. SSM Health Care Corp., 126 F.4th
1329, 1333-34 (8th Cir. 2025); Johnson v. Advance Am., 549 F.3d 932, 936-37 (4th Cir.
2008); In re Sprint Nextel Corp., 593 F.3d 669, 676 (7th Cir. 2010). Because the
proposed class contains only New Jersey citizens, diversity of citizenship is absent.
Further, “CAFA does not change the proposition that the plaintiff is the master of
her own claim” and a plaintiff may limit her claims to avoid federal subject matter
jurisdiction. Morgan v. Gay, 471 F.3d 469, 474 (3d Cir. 2006), abrogated on other
grounds by Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. 81 (2014); accord
Johnson, 549 F.3d at 937; In re Sprint, 593 F.3d at 673. Barnett chose to limit the
putative class to only New Jersey citizens. Thus, the case lacks the minimal diversity
required for a court to exercise subject matter jurisdiction under CAFA and remand was
required.
III
For the foregoing reasons, we will affirm.