please the court my name is carter phillips i'd like if possible reserve three minutes for rebuttal right i'd like to begin with where i think the district court committed the sort of fundamental error in this case and i suppose there's two components to it one is i believe the district court misinterpreted the supreme court's decision in watson versus philip morris and indeed got almost one hundred percent wrong and second the district court erred by following the seven circuits interpretation of watson and the boeing case to my mind this case is fundamentally different from both of them from watson in ways that should have been i think dispositive if you go back and what we know about fourteen forty two eighty one is that unlike every other removal statute this is a statute that's construed liberally in favor of removal that is designed to protect any federal interest that is at all implicated in a particular case and to protect those federal interest to ensure that they are litigated fully in a federal court and what the supreme court said in watson when it was dealing with the f is regulatory scheme as it applied to philip morris was what we're not talking about in terms of removal is a simple situation where a party is complying with federal law and has to bring itself into  substantial compliance with the regulatory scheme at issue and what the court spent a lot of time focusing on in that context was what it regarded as the fatal flaw in the philip morris submission and that was what it called a flaw of omission and that is that there is no evidence of any delegation of legal authority from the commission to the industry association to undertake the testing on behalf of the government's behalf what we have in our case is exactly  provision that authorizes the federal aviation administration to delegate to private representatives to perform a variety of tasks involving inspecting testing and issuing certificates the regulations that implement that are at  r part one eighty three and there are sixty seven sections that not only provide the f a a with the authority or to implement the statutory authority that it has but also provides all of the conditions of the need to be satisfied in order to retain that kind of an authorization you then have the ody a order that's the order that provides for organizational designation authorization which is what the airbus helicopter has in this particular case that is itself a two hundred seventy nine page document with exquisite detail as to the delegation of what it is exactly that my client and all similarly odio holders are supposed to do and then finally have the memorandum of understanding specifically between my client and the federal aviation administration again dealing specifically with testing inspecting certain granting certifications it's effectively being the deput this that's an issue in this case absolutely no other no other helicopters were certified under the auspices of the delegation right and that's and that and it's very clear because the i just want to make sure that the record right we found and the reason for that is because the f a a obviously is going to ask for the organization that's being designated to be one that understands thoroughly every aspect of the item that's being certified as so you know we don't know nearly as much about other manuf i don't know boeing's and my clients don't know boeing's system so you wouldn't ask my client to be the ones that sort of i might find others who could certify boeing under certain circumstances but miss k c s are sort of occasion authority was limited to the airbus helicopters just to be sure i understand there were presumably other helicopters that were manufactured by air bus yes and we're not concerned about those other then they would have had the if they would have delegated the certification process to the company with respect to those as well yes you're right that's absolutely correct fundamental mistake that the seven circuit main boeing is is ratcheting up the standards for what it means to act under within the meaning of the statute because judge easterbrook opinion somehow identifies a rule making versus rule implementing distinction as the basis for whether or not you are in fact within removal and if you put this in the context of what the federal official removal provision is all about right which is which is the situation where customs agents are deputizing private citizens to help them in a law enforcement situation the idea that those people are exercising some kind of rule making authority as opposed to simply doing whatever it is they're told to do by federal federal government is laughable so that that cannot be the distinction indeed it seems to me watson itself tells you what the distinction is is there a clear delegation of authority to the private person under those circumstances and that seems to me undeniably true in this case the other two requirements neither of which the district court addressed in this particular case but i think this so this court could presumably either send it back but i think the issue is is fully briefed and easy enough for the court if it's all one is do do the claims in this complaint relate in any way to an act that is undertaken under color of law and if you read the complaint the complaint talks all about testing in inspecting and authorizing and certifying and those are all of the tasks that were specifically delegated to h i by the federal and then the last issue is is there a colorable defense and to my mind preemption is clearly a colorable defense whether it will win or not is not the issue is it plausible and there's no doubt about it first of all we are dealing in a very unusual situation this is about as comprehensive a regulatory scheme as any i have seen and i've been inside the beltway for a long time so i seen a fairly large number of these things and while i am usually doubtful that simply by a comprehensive knows that that by itself will necessarily be adequate to demonstrate fuel preemption my guess is you're going to be able to find carve out segments of this repeal preemption but you don't need to know that now that's secularization all you need to know is that there is a colorable argument on that basis and with then that extraordinarily complicated scheme is there some risk that this litigation is going to put impose duties on us or at least risk imposing duties on us that  inconsistent with the duties that we need to perform for the federal government health and if that's if you're successful in your removal efforts with your client be inclined to assert the government sovereign immunity defense this year in federal court i don't know that we would have i mean no i don't think so i mean i just point i think the defenses that we have in mind i mean we're not a government contractor in that sense we don't we're not we're not we don't build these pursuant to federal requirements we build them for private purposes for the most part so and least in this particular case i don't believe we would do that our defense here our colorable federal defense here w strictly out of the preemption argument the last point i was going to make is the idea that any of the obligations that could or could be imposed as a matter of the state law so this litigation that it couldn't interfere with the full objectives as a federal  scheme is a very is a very serious issue and want to get and it seems to me you can't evaluate that at this point all we know is they have asked you to in to take a hard look at a party who has been essentially deputize by the authorization approval of it has to do your what the what you did under federal law has to do with the issues that are going to get litigated in the case well it the only thing that it is in terms of the authorization the don't have anything to do with it and we've been clearly delegated this authority and we acted pursuant to that the question is is there a is there a colorable federal defense that we will be asserting as part of that litigation and the answer is clearly yes we have to we have preemption extraordinarily helpful document in understanding the regulatory scheme and explaining the difference between what a regulated entity does want to do when it demonstrates compliance as opposed to what it does when it terminus compliance which is what you do under the f a a scheme in this particular case and then the second point i would just make in passing is that it is striking to me at least as someone who used to be in the solicitor general's office to read the brief of the solicitor general in the submission that it made in the watson case and how the united states government specifically identified this very program as the as centrally the archetype of one that is that justifies federal removal and that was in response to a concern that this statute would be much too narrowly construed and to be too limited in its ability to allow federal interest to be protected by federal courts if there no other questions your honor reserve the balance of my time all right thank you counsel thank you two essential elements of the statute may it please the court plaintiffs and airbus helicopters actually agree on one thing and that is that this is a helicopter design defect case a rising under state products liability law and that's important that goes to your question judge schroeder because in order to show that this product manufacturer was acting under the f a a it must demonstrate that the f a a that it was the f a a that designed this helicopter without a crash resistant fuel tank and we know and there's no dispute the f a a is not in the business of designing helicopters or honors their mission is to regulate safety of aircraft and they do that by promulgating regulations testing requirements which it is up to the helicopter manufacturer to design and to meet these minimum standards but the design choices are solely the manufacture that goes to your point judge shorter and secondly and this is this is critical they show compliance by means of what we've called these f a a designees these are the in house folks who gather the data the testing data and they submit that to the f a a to demonstrate their compliance now all of that is done with the supervision and the oversight of the f a a so how does airbus get to acting under you heard of admit they're not claiming to be a government contractor so that's off the table we are then limited they're very limited then to what they can say that gets them to acting under and they've said and this goes to your point just wrong and they have said both in their that that was throughout that's not true respectfully that is a misrepresentation of this record the only time the word one hundred ten page complaint is one time and that is in the introduction regarding general allegations and solely as an identifier there is no incomes aren't we supposed to look at where the the delegation has occurred with respect to the power to issue a supplemental type certificate and that would in include would it not design issues the power to issue a supplemental type certificate judges scanlan is simply the power that it gives to the aircraft manufacturer to solve certify that a change in design that's what an s t c is meets the requirements but if that's the delegation that's the first step in this analysis of that is the delegate that's the delegation but it is a formal delegation of the ability to show compliance and however formal it is they are there really hung up here on the degree of formality of the delegation but the formality of the delegation is not what's controlling it's what's being done to gated in judges scanlan the only thing that's being delegated with an s t c and the ability to do that is to self certify according to the regs and the testing that this change designed is in compliance with the regs that's all it is just can one and getting back to the point would how do you understand the preemption argument that i think your point that you made with council that's a totally different argument that doesn't implicate the acting under requirement whether or not that's a colorable federal defense we would say for another day but my point to you would be if that's true if if they were preempted for making a safe helicopter fuel tank then why are all of the other helicopters in that class have the safe fuel tank so it's simply not true and getting back to this point about what is the preemption argument is your adversary but would that absolutely wrong no one tells airbus how to design a fuel tank or a helicopter or a main rotor blade judge schroeder they merely give them the and the actual their stress test their strength tests they don't tell them how to design they just tell that the reason for the whole program absolutely that's exactly right judges can and they want to have certain  and it doesn't make sense the argument does seem to make sense if the issue is delegation the delegation is a legal or regulatory authority and your honor the specific regulation applicable here which is the order eighty one ten point one five which everybody cites and it is that page one thirty of the id and them says that the oed holder may not perform regulatory activity in airbus helicopters concedes in their brief at page seven that f a a to your point your honor retains the ultimate authority of determining compliance compliance does not equal acting under the watson case which was the unanimous supreme court decision is dispositive here because in that case the court was very clear that a product manufacturer in a heavily regulated industry no matter how highly detailed or complex they do not act under that federal agency and the court arrive there your honour's by looking at the acting under language and and deciding that this was not the kind of assistance simply complying with federal regulations that rose to the level of acting under to trigger the federal officer removal statute and i think it's very important to your point judges  that this defendant it mit's this point of law at page twenty four of its brief quote a h i recognizes that such compliance alone would not allow removal under watson and so where we get to this legal authority idea is this in this underlies the real flaw in their argument they cherry pick that phrase as he did today formal delegation of authority and confuses that with the delegation of legal authority but there's no delegation of legal or regulatory authority it's only the the authority to comply and that's what so critical and that is also it knitted by the defendant on page this is on page seven f a a retains the ultimate authority of determining compliance and that is to your point judge of scandal and we can talk about the memorandum of i'm an understanding and all of these regulations and he commits up and says well i've never seen so much regulation it's almost like a tipping point argument that there is so much regulation a well that's there's must be a reason but in our situation there's no showing as was compelling in watson that there's any delegation of legal authority ultimate regulatory authority and that's what's missing here and i want to talk about the fidelity dot case this court would say that this is just similar to having to comply with regularly precisely judge schroeder and a lot of regulation compliance is just sill compliance the watson compas then with respect to the supplemental type certificate the supplemental type certificate judge zero scanlan is as we united talked about before only authority to the type certificate holder to make a revision or change subject to showing compliance that the change meets the regs without you up to first part but i'm not convinced on the second part subject to showing compliance it seems to me that there's a delegation is there not no the there is a delegation to show compliance in other words that is that is actually what this court and i started talk about fidelity down it goes to your precise point judge or scanlon because this court and this is was the subject of our twenty eight j letter infidelity dot this court sided with approval the seventh circuit decision in luzon hong which they say they disagree with this was a unanimous in back decision by judge easterbrook and the decision there was absolutely  along the same lines bowing was in the same position as airbus here today and the court said that the delegation to self certify to an aircraft manufacturer did not meet the acting under standard and this is very important because in this case the ninth circuit not only cited too but quoted that precise holding with approval and that's critically important and no court since that seventh circuit decision has expressed any disagreement with the analysis or conclusion of allusion hong that all of this is simply regulation it's a lot of regulation but it's regulation and finally to his point about there being some kind of a risk of state court prejudice that's not shown here that there's any risk of any state court prejudice by allowing this state court lawsuit to proceed under state law i counsel thank you thank you your honors good afternoon your honors and may have please the court my name is patrick kearns my firm represents the operator defendants in this case the pelleas who operated the helicopter on their employees now i  took five minutes today of our side of the argument to talk about the second two elements of the three as you'll see now and as we've already learned from the arguments so far there's a lot of overlap there's a lot of overlap between these three elements at least and i'm at least in the discussion since we've already talked about the defense we've already talked about acting under but perhaps i can help clarify some things from what i've heard what we have here is a situation where  trying to tell this court that the sheer size or the sheer volume of the regulations at issue somehow make this delegated authority something more than it is and this bears on the first part that i want to talk about which is an element that they have to demonstrate which is causation now these oh da status designations they're very common in the aviation world and they allow a h i v ability to self certify that they've met these regulations now if there was an in there may very well be judge order a a department and i would be aware of it that supervisor regulates the creation of baby cribs for example and if that was the case the manufacture of a baby crib in such a situation as a child i would have been delegated the authority to look at their baby crib and say well department of baby cribs we know what your regulations are we've read them were experienced in them and here we  that's all this designation does so i think that's why i asked the question this to whether or not any of their helicopters were certified on good this authority exactly and i thought the answer was that they at the helicopters and that is that is incorrect and i don't believe that that was the answer they had the ability to self certify their own helicopters he mentioned the foreign corporation and what i assume councils referring to as their parent they and air bus has the last word it doesn't go back it is not going to be reviewed by the f a a the the certification the certificate that is is the final word is and actually i don't think that's correct your honor and i don't believe that airbus will tell you that's correct and let me tell you why that brings me to i'm going to skip over a point quickly but it brings me to their preemption argument in this very case if you look at their briefing and they'll  they'll have to tell you when they stand up here in order to argue to this court that they are acting under a federal officer they claim just that they claim that they have been deputized by the f a a that they have the  authority to do what they want and then certify it but then when it comes to demonstrating a necessary colorable defense iraq was that element to federal jurisdiction here they tell you right in their briefs they don't have that ability they say the only way we can make a change to this helicopter is if the f a a comes in and issues final certification because otherwise there would be no preemption there would be no conflict right if a h a h a i had the unfettered ability to self certify without the f a s approval or involvement then they don't have a preemption argument they have argued the exact opposite defense from both ends and they can't have it both ways one of the final things i'll say in my last thirty seconds your honor with your honor's with respect to at least the causational and i think this is significant and this is sort of raised in the what we're calling the boeing case or the blue john ong case that it's important recognize the when it comes to the causation element of this of this particular should we have to look at what it is that the planes are claiming and that's gotten a little bit lost in this doesn't in this argument they're claiming state law design defect claims negligence claims that they designed a defective a dangerous helicopter there is no allegation here that the f a a was negligent there is no allegation that the f a a a's delegate delegate t s were negligent in performing those duties and there was one case and i'd like to mention this briefly it's the it's cited in both the state of hacker case that court made a comment and i thought it would be instructive here that court was addressing a lawsuit against a aircraft engine manufacturer lycoming and that court made sure it was a sort of addictive comment but it said the court noted that the manufacturer in that case was not being sued like in this one because of their o n status or because they failed to do something in relation to their own status and they said the claims would be equally viable without it and i think this court should ask that question in this case if we remove  i'm only thing between you and lunch so i'll try to be brief at this point let me start off by being very clear in terms of precisely what the allegation of the complaint is that gives rise to our concern here and it comes on page thirty eight of our brief or we cited but it's paragraph four eighty six of their complaint where they talk about the breach of the duty of care by its failure to properly design test manufacture sell monitor feel perform accumulate field data recall and distribute safe helicopters and component parts that strikes me as if the entirety of what is its issue when you're talking about the certification process and i talked about the statutory delegation in the regulatory delegation but if you just look at the memorandum of understanding what does it sa certificate now is it true that the the f a a has the authority to rescind actions taken yes it does but the bottom line is that the basic certification authority in the first instance is delegated and they are in fact i don't understand why the delegation of the sort i still don't understand exactly your theory of why the delegation of the certification authority means that something is going to be litigated here other than a garden variety design defect because at the end of the day the real question is whether or not the federal interest in how the safety of these helicopter it gives that it tells them what standards they have by but it also but it does tell them under certain circumstances whether to approve or not approve and and ultimately the issue here is one of of a failure of omission rather than comissioner which is that said the should have been some kind of a supplemental type certificate offered up under these circumstances and in that context given that that clearly implicates an area that delegated authority with a very low bar on the question of whether or not there is causation convolve going call versus that specifically and clearly and finally with with merely having to demonstrate callable preemption it seems to me honor system below as it should be reversed in this case should be litigated in federal court and are you asking us to create a split with the seventh or i would try to argue that the court the supreme court doesn't have to resolve that split in the invention did go down there but no i don't see any way to distinguish the way judge easterbrook approach this on the other hand i think there's an existing split between