February 2021 Longshore/Maritime Update (No. 261)
Notes from your Updater:
President Biden has selected Boston Mayor Marty Walsh as the next Secretary of Labor.
Judge Rodgers has selected the case of Christopher F. Causey (No. 3:19-cv-2108) as the bellwether case to be tried as a representative of the beach/ocular Back-End-Litigation-Option cases against BP from the DEEPWATER HORIZON/Macondo cleanup that are pending in the Northern District of Florida. In re: DEEPWATER HORIZON BELO cases, No. 3:19-cv-963 (N.D. Fla. Jan. 19, 2021).
On the LHWCA Front . . .
From the federal appellate courts:
Section 20(a) presumption does not apply to jurisdiction, but a bridge construction worker established that his hearing loss occurred on navigable waters; Wilson v. Director, OWCP (Creamer-Sanzari Joint Venture), No. 19-3542 (3d Cir. Dec. 31, 2020) (Restrepo).
The appellate courts continue to face questions about navigable waters (see the Ninth Circuit’s decision in the January 2021 Update, In re Garrett, discussing Holter Lake in Montana). Richard Wilson sustained hearing loss while driving steel pipes for a cofferdam during the construction of the New Jersey Route 3 bridge replacement over the Lower Passaic River (from Clifton to Rutherford, New Jersey). At that location the navigation channel in the river is 150 feet wide and ten feet deep. Wilson was working from a float stage on the river, and his claim for benefits under the LHWCA depended on whether he was injured on a covered situs (navigable waters). Administrative Law Judge Boucher ruled that it was Wilson’s burden to prove that the river was navigable at the time of his injury and that he failed to carry his burden of proof. The Benefits Review Board affirmed. Writing for the Third Circuit, Judge Restrepo first addressed Wilson’s argument that Section 20(a) creates a situs presumption for claimants that shifts the burden of disproving situs to the employer/carrier. The Third Circuit rejected that argument, reasoning that situs is a threshold issue that must be resolved before the presumption can be applied. Thus, Wilson had the burden to establish situs, and, even if the presumption did apply, it would have done nothing more than to shift the burden of production, not the burden of proof. Turning to whether the Lower Passaic River was navigable at the location of Wilson’s work, the ALJ, BRB, the parties, and the Third Circuit used the “navigable-in-fact” definition–that the body of water “by itself or by uniting with other waterways, forms a continuous highway capable of sustaining interstate or foreign commerce.” However, Judge Restrepo reasoned that the ALJ and BRB misunderstood the definition and required that a waterway be capable of sustaining commonly-used large commercial ships or that there be evidence of present commercial use. Instead, Judge Restrepo stated that a waterway is navigable if it is capable of sustaining any type of interstate or foreign commerce. As the evidence established that commercial vessels operating on the river were able to transit areas where the channel was as shallow as four feet; that the river had been used for commerce and industry for almost two centuries; and that there were no impediments blocking navigation between the area where Wilson was working and the confluence of the river and Newark Bay, the Third Circuit held that Wilson had satisfied the situs requirement and remanded the case for a determination of the benefits to which he was entitled under the LHWCA.
Eleventh Circuit upheld decision that the union and stevedoring companies did not discriminate against a longshore worker who was fired for bringing a seat cushion to a vehicle; Barneman v. International Longshoreman Association Local 1423, No. 20-10914 (11th Cir. Jan. 6, 2021) (per curiam).
Rayfield L. Barneman, a 68-year old longshoreman, suffers from a chronic back condition that is aggravated by sitting. As a result, he carried a seat cushion with him to work when he sat in new automobiles and shuttle vans. He was discharged for violating the “no personal items” policy when he tried to bring a cushion into a vehicle in violation of the policy. He then brought claims against the ILA local and his stevedoring employers for age and disability discrimination. Finding legitimate, non-discriminatory reasons for his termination and reasonable efforts to accommodate his disability, Judge Baker dismissed the claims (see March 2020 Update). Finding sufficient evidence for the findings of the district judge, the Eleventh Circuit affirmed the dismissal of Barneman’s claims.
From the federal district courts:
Actual knowledge by the injured ship repairer of a remedial condition on the barge sank his claim of violation of the turnover duty; In re Ecoserv, LLC, No. 3:19-cv-00132, 2021 U.S. Dist. LEXIS 570 (M.D. La. Jan. 4, 2021) (Dick).
Amos Ambrose, a welder employed by Vessel Repair, Inc., was injured while working as a welder in the bow of Barge NESI 11 when he passed out as a result of heat exhaustion and exposure to welding fumes while performing repairs for the vessel owner. He brought this action against the vessel owner under Section 905(b) of the LHWCA, alleging that Ecoserv, LLC breached its Scindia turnover duty by failing to warn Ambrose’s employer of a hazardous condition (lack of ventilation) in the area of the bow needing repairs. Ambrose further asserted (to his subsequent detriment) that had he been warned he would have to use protective ventilation equipment while performing the welding work. Ecoserv moved for summary judgment, and Judge Dick granted the motion for two reasons. Judge Dick reasoned that the risk of poor ventilation was real but not necessarily hazardous. Judge Dick cited Ambrose’s own admission as an indication that the lack of ventilation in the barge was only hazardous if work was performed without protective gear. Judge Dick also noted that Ecoserv introduced evidence that it did not direct Ambrose’s employer to use any particular work practice, tool, or equipment and that it was entitled to rely on the assumption that Ambrose was an expert and experienced stevedore who would act with reasonable care. Judge Dick held that Ambrose had done nothing to rebut the summary judgment evidence or create a genuinely disputed issue that Ecoserv knew or should have known that the condition in the barge would become a hazardous condition. Judge Dick went on to reason that, even if risk of poor ventilation posed a hazard, the vessel owner’s turnover duty was not absolute. Citing the open-and-obvious exception to the turnover duty, Judge Dick reiterated that Ambrose had admitted that the lack of ventilation in the barge was a risk. Judge Dick further noted that Ambrose introduced no evidence to demonstrate that he was presented with a Hobson’s choice of deciding between working under hazardous conditions or not working at all. Judge Dick concluded that Ambrose’s knowledge of the remediable condition precluded liability of the owner under the turnover duty.
From the state courts:
Ship repair and ship builder subsidiaries operated as a single entity for the LHWCA exclusive remedy provision; Sanders v. Vigor Fab, LLC, No. A168740, 308 Ore. App. 282 (Ore. App. Dec. 30, 2020) (Mooney).
Ronald A. Sanders was injured while trimming a steel deck plate for a barge being built by Vigo Fab. Vigor Fab and Vigor Marine are subsidiaries of Vigor Industrial. Vigor Fab builds ships, and Vigor Marine repairs and maintains them. Vigor Industrial performs the administrative functions for its subsidiaries, and the subsidiaries occasionally share personnel. Sanders was hired by Vigor Marine as a boiler maker and welder, but about once a year Vigor Marine assigned him to a job for Vigor Fab. Sanders was on a temporary assignment for Vigor Fab when he was injured. Sanders filed a claim under the LHWCA against Vigor Marine and a negligence case under Oregon Law against Vigor Fab (as a third party). Applying the single entity test, the district court held that Vigor Fab and Vigor Marine were functionally integrated and qualified as a single entity, entitling both entities to the exclusive remedy defense from Section 905(a) of the LHWCA. The court of appeals recognized that it was not bound by the interpretation of federal law from the federal district courts and federal courts of appeals, but it relied on the framework developed in their decisions to apply the single entity doctrine, treating separate entities as a single entity when their operations are interrelated; when they have common management; when their labor relations are centrally controlled; and when they have common ownership. As the evidence established that the four factors were established in this case, the appellate court affirmed that both Vigor Fab and Vigor Marine were Sander’s employer and that Sanders was barred from bringing this suit under Oregon law.
And on the maritime front . . .
From the federal appellate courts:
Fifth Circuit affirmed dismissal of claims for negligent infliction of emotional distress for fishermen in the vicinity of the DEEPWATER HORIZON explosion and fire; In re Deepwater Horizon, No. 20-30300 (5th Cir. Jan. 11, 2021) (per curiam).
This decision involves claims of fishermen seeking to recover for negligent infliction of emotional distress because they were near the DEEPWATER HORIZON at the time of the explosion that destroyed the rig. Two sets of plaintiffs were presented to Judge Barbier. The Andry plaintiffs were fishing from a 26-foot boat under the lip of the DEEPWATER HORIZON when liquid began raining down on them, causing their eyes to burn. They heard a loud hissing sound and quickly left the scene, getting about 50 yards away before the rig exploded. The Shivers plaintiffs were located miles from the DEEPWATER HORIZON, fishing from a 31-foot boat, when a distant light caught their attention. They heard and felt a sonic boom explosion and then motored to the scene where they helped search for missing persons but found no one. They heard rumbling sounds coming from below the water and were frightened but continued searching. Both sets of plaintiffs brought suit against BP, Transocean, and others for negligent infliction of emotional distress, and the Shivers plaintiffs added a count for intentional infliction of emotional distress. The general maritime law allows a plaintiff who meets the physical injury or impact rule to recover for negligent infliction of emotional distress, but the Fifth Circuit has not ruled whether NIED claims may be brought under the general maritime law for those who are in the zone of danger. As the Fifth Circuit has applied the zone-of-danger test for NIED claims brought under the Jones Act, and as other circuit courts have applied the zone-of-danger test in maritime claims, Judge Barbier concluded that the zone-of-danger test applied to NIED claims under the general maritime law. Judge Barbier then applied the test, requiring that the plaintiff objectively be in immediate risk of physical harm and subjectively believe that he is in immediate risk of physical harm. Hearing and feeling the explosion was not sufficient to allow the Shivers plaintiffs, who were miles away, to recover. However, the record was not sufficient for Judge Barbier to rule on whether the Andry plaintiffs faced immediate risk of physical harm. He left the issue open to be revisited upon further development of the factual record. Judge Barbier dismissed the Shivers plaintiffs’ claim of intentional infliction of emotional distress because their conclusions, couched as factual allegations, did not suffice to establish that the defendants intended to inflict severe emotional distress on the plaintiffs or that the defendants knew that severe emotional distress would be certain or substantially certain to result from their conduct (see March 2020 Update). The emotional injury claims of the Shivers plaintiffs were again addressed by Judge Barbier after giving them leave to amend to present a facially plausible case for negligent infliction of emotional distress. They asserted claims for negligent infliction of emotional distress for being frightened while searching in the zone of danger and in connection with the physical injuries they suffered during their efforts. Judge Barbier rejected their claims and dismissed their amended complaint with prejudice. Although they believed that they were under threat of another massive explosion that would send debris near their vessel, Judge Barbier did not believe that they objectively faced an immediate risk of physical harm as no debris was ever thrown anywhere near their vessel. With respect to the physical injuries they suffered, such as bruises and scratches from leaning over rails and passing gear to other vessels, and one worker smashing his hand while holding onto a lifeboat, Judge Barbier noted that the claims of emotional harm did not relate to those injuries but from the fear of an explosion. Finally, even though some of the fishermen had singed hair and burns on their faces, the closest they came to the rig was between 100 and 200 feet, not enough to be licked by the flames and to fear that they would be consumed by the fire (see May 2020 Update). Affirming Judge Barbier, the Fifth Circuit held that the pleaded injuries were not sufficient to satisfy the physical injury test. And, even if they did, the plaintiffs failed to allege that their physical injuries resulted in their emotional distress. Instead, the distress resulted from what they saw, the exploding rig and the destruction in the water. The Fifth Circuit did not have to hold that the zone-of-danger test was applicable as the court held that it was not satisfied by the pleading because the plaintiffs did not allege an immediate risk of physical harm. The plaintiffs were never closer to the rig than 100 to 200 feet, and the rumblings from below the surface of the water were insufficient to objectively establish that they were in the zone of danger.
Failure of attorney for vessel owner to appear at hearing was not ground to set aside judgment in favor of lender; Su v. Wilmington Trust, National Association, No. 20-20337 (5th Cir. Jan. 13, 2021) (per curiam).
Four corporations owned by Hsin Chi Su obtained loans from a syndicate of lenders to finance the construction of several vessels. Three years later, the corporations sought Chapter 11 relief, and the bankruptcy court authorized the sale of the vessels to an entity that held most of the debt. Su then brought an action against several of the lenders seeking a declaration that the sale of the vessels did not alter patent rights that Su claimed for the design of the vessels. The successor to one of the lenders brought a counterclaim against Su, based on his personal guarantee of the debt, for the balance on the vessels’ debt after the sales. The lender filed motions for summary judgment that were opposed by Su through his counsel, Hoover Slovacek. After the motions and responses were filed, Su substituted Robins Kaplan as his counsel. The district court ruled that Su was not entitled to relief and entered a final judgment without addressing the counterclaim. Four months later, the lender asked the district court to reopen the case to adjudicate its counterclaims against Su, and the district court agreed and scheduled a hearing. Three days before the hearing, Robins Kaplan moved to withdraw as counsel for Su, and neither the firm nor Su appeared at the hearing, even though the motion to withdraw had not been granted. The court was unsuccessful in reaching counsel and entered a judgment for the lender for more than $60 million plus interest of more than $17 million. The court also denied Robins Kaplan’s motion to withdraw. In response to a motion to show cause, the firm answered that it had been unable to communicate with Su and believed that it did not have authority to bind him. Su later moved to vacate the judgment pursuant to Rule 60(b) on the ground that he had been incarcerated in the United Kingdom for civil contempt and had been unable to reach counsel until he was released. The district court declined to set aside its judgment against Su, and the Fifth Circuit affirmed the denial. The court of appeals agreed that Robins Kaplan had effectively abandoned Su at the hearing despite not being allowed to withdraw, but the failure of the firm to appear was not a basis for relief under Rule 60(b) as it was not mistake, inadvertence, or excusable neglect. Additionally, the case was not so extraordinary as to allow relief because the motion had previously been fully briefed by counsel and the judgment was entered based on the merits and not because Su and his lawyers failed to appear at the hearing. The court of appeals did note that it did not condone the conduct of Su’s counsel in failing to appear.
Fifth Circuit affirmed decision holding that the purported spouse of an undocumented alien killed by a Coast Guard vessel while swimming across the Brownsville Ship Channel could not recover from the Coast Guard or the vessel/engine manufacturers. Garcia v. United States, No. 19-40718 (5th Cir. Jan. 19, 2021) (Willett).
Patricia Guadalupe Garcia Cervantes, an undocumented alien, and her smuggler, Galindo Ruiz-Hernandez, were swimming across the Brownsville Ship Channel at night to enter the United States illegally from Mexico. She was trying to cross undetected, so she had no illuminating or noise-making equipment to alert authorities (or vessels) of her presence. She was killed when a Coast Guard vessel struck her while the vessel was navigating in the ship channel. Her purported spouse brought suit against the United States and the manufacturers of the vessel and engines. Judge Olvera dismissed all of the claims. First, he held that the United States did not owe any duty to Cervantes unless the Coast Guard had actual knowledge about the probability of hitting Cervantes as she swam across the Channel. Second, Judge Olvera dismissed the claims against the manufacturers. As Cervantes was essentially a bystander, she lacked standing to bring a maritime product liability claim, and, if there were a duty to warn of a danger in the product, it would be the United States, and not the plaintiff, who would have a claim. Ruiz-Hernandez was convicted of conspiracy to transport an alien resulting in death and transporting an alien for private financial gain and resulting in death and was sentenced to 80 months in prison (see September 2019 Update). Writing for the Fifth Circuit, Judge Willett initially addressed whether the claims fell within the admiralty jurisdiction so that there was jurisdiction against the United States under the Suits in Admiralty Act or Public Vessels Act. Concluding that the district court had admiralty jurisdiction, Judge Willett turned to the duty owed by the United States. Agreeing that a collision between a vessel and an individual swimming across the Channel was not reasonably foreseeable, even though the Coast Guard was aware that undocumented aliens used the Channel as a point of entry into the United States, Judge Willett agreed that the Coast Guard did not owe a duty to Cervantes. With respect to the product liability claims, Judge Willett agreed that Cervantes was neither a user nor a consumer of the vessel/engines, and therefore there was no duty to warn Cervantes, a bystander, applying the Second Restatement of Torts and declining to apply the Third Restatement of Torts as the Supreme Court and Fifth Circuit have adopted the Second Restatement as the governing law in maritime products liability cases (Judge Willett also declined to apply Texas law as there is no gap that needs to be filled in the general maritime law). Judge Willett also held that, even if maritime law gave standing to bring a products liability claim in this case, there was no evidence that the alleged defects proximately caused Cervantes’ death. Finally, Judge Willett held that there was no basis to supplement the maritime wrongful death remedy with state remedies for the death of nonseafarer Cervantes (based on Yamaha Motor Corp. v. Calhoun) because there were no viable claims against the United States or the manufacturers.
Uberrimae fidei remains an entrenched doctrine of marine insurance law, even though it has been abolished in England; actual reliance is not necessary to establish a violation of the doctrine; QBE Seguros v. Morales-Vazquez, No. 19-1503 (1st Cir. Jan. 19, 2021) (Selya).
Morales-Vazquez purchased an insurance policy in 2011 on his forty-foot Riviera yacht from a company that was acquired by QBE. In the application he left blank the spaces providing the answers for questions about his boating history and accidents related to any vessel. Three years later, in 2014, Morales-Vazquez applied for a separate policy on his 48-foot Cavileer yacht. In this application he disclosed two of the seven boats that he had previously owned/operated and disclosed an accident involving a propeller strike but failed to disclose an incident in January 2010 in which the Riviera yacht was grounded. The Cavileer yacht was insured for $550,000. Later in 2014 the Cavileer yacht was damaged in a fire. During the extended negotiations with Morales-Vazquez over payment for the loss, the insurer discovered the 2010 grounding and the other vessels that Morales-Vazquez had previously owned/operated and filed this suit seeking a declaration that the policy was void. After a six-day bench trial, the court concluded that QBE was entitled to void the policy for breach of the doctrine of uberrimae fidei (utmost good faith) and for violating the policy’s warranty of truthfulness. The First Circuit affirmed the application of the doctrine of uberrimae fidei to void the policy. Judge Selya issued a lengthy analysis of the development and application of the doctrine (applied throughout the United States except in the outlier Fifth Circuit), and concluded that it remained an entrenched principle of maritime law that was not subject to the application of state law under Wilburn Boat. Morales-Vazquez argued that, after the doctrine was abolished in the United Kingdom in 2015, it should be scuttled in the United States in order to harmonize our insurance law with English law. Although recognizing that maritime law is intended to be dynamic and evolve over time, Judge Selya noted that Congress has been silent on the issue and that the needs of the marine industry still necessitated the doctrine. In fact, the present case was a “poster child” for the continuing relevance of the doctrine. Judge Selya then addressed the application of the doctrine and whether there was a requirement that the insurer demonstrate actual reliance on the insured’s omissions in issuing the policy. Following the majority of decisions, Judge Selya ruled that the materiality of a false statement or an omission, without more, provides a sufficient ground for voiding a policy under the uberrimaie fidei doctrine. As the district court found that the omitted facts crossed the threshold for materiality, the First Circuit affirmed the declaration that the policy was void. Thanks to Hal Watson with Chaffe McCall in Houston, Texas, for bringing this case to our attention.
Bunker supplier’s settlement with the vessel’s charterer did not extinguish the supplier’s maritime lien against the vessel; Addax Energy SA v. M/V YASA H. MULLA, No. 18-2438, 2021 U.S. App. LEXIS 1828 (4th Cir. Jan. 22, 2021) (Keenan).
Addax Energy entered into a fuel supply agreement with the charterer of the M/V YASA H. MULLA (Windrose SPS), and delivered the bunkers at the cost of $320,997.77. Windrose failed to pay the amount due, and Addax filed a claim against Windrose in a Swiss bankruptcy court. Addax and Windrose entered into a settlement by which Windrose agreed to pay installments of $344,481.81 (invoice amount plus interest and fees). As partial payment of the total, Windrose assigned to Addax Windrose’s claim against third-party Cargill that was worth at least $100,000. The vessel was not a party to the settlement with the charterer. Windrose paid Addax $40,000 since entering into the settlement, but Addax brought this in rem action and arrested the YASA H. MULLA in federal court in Virginia. The owner posted cash security, and the district judge granted Addax’s motion for summary judgment that it had a maritime lien. After a bench trial, the judge awarded Addax the balance due on the invoice (after deducting the $40,000 payment) plus prejudgment interest and custodia legis expenses. Before addressing the existence of a maritime lien, Judge Keenan, writing for the Fourth Circuit, considered whether Addax had standing to assert its lien claim because it had purportedly assigned its right to collect receivables to a financing company. Judge Keenan ruled that this issue was not one of standing but questioned whether Addax was the real party in interest. The vessel owner cited the language in the fuel supply agreement that the invoice had been assigned in accordance with Addax’s legal and contractual obligations. However, Addax presented evidence from its corporate designee that the language was included as a matter of standard company practice and that the designee was unaware whether Addax had assigned its rights for this invoice. As no assignee had come forth in the Swiss bankruptcy or in the in rem litigation, the district court held that Addax was the proper party in interest. The Fourth Circuit agreed. Judge Keenan noted that the holder of a maritime lien may pursue an in rem action to enforce the lien and an in personam action against the party responsible for breach of contract. However, the vessel owner argued that the settlement agreement, a non-maritime contract, had superseded the fuel supply agreement and did not give rise to a maritime lien. Judge Keenen responded that the vessel owner misapprehended the settlement agreement. The vessel was not party to the settlement, and the agreement did not extinguish the supplier’s lien on the vessel. The only claim presented in the American suit was the in rem claim that was not based on Windrose’s failure to pay any amounts due under the settlement agreement. Finally, Judge Keenen affirmed the decision of the district court that the amount of the in rem judgment should be reduced by the value of the assigned claim. However, Addax had not received any payment from Cargill, and the Fourth Circuit affirmed the decision that the judgment should not be reduced. Judge Agee dissented on the ground that the record was too “murky” on the assignment issue and that a remand was necessary to clarify whether Addax could bring the claim.
Seaman failed to establish causation for negligence and unseaworthiness claims for his injury when he slipped on a pipe; McCorpen defense to maintenance and cure was established regardless of subjective intent to deceive or subsequent medical history indicating that his back was not injured; Adriatic Marine, LLC v. Harrington, No. 20-30226 (5th Cir. Jan. 28, 2021) (per curiam).
Roland Harrington was employed as an engineer on Adriatic’s vessel M/V ADRIATIC on March 18, 2018. He claims that he had cleaned inside the vessel’s bilge around the port main engine and slipped and fell while departing the bilge, hurting his back. Adriatic initiated maintenance and cure in response to a demand from Harrington’s attorney, and sought a medical examination when Harrington’s physician recommended a two-level fusion in Harrington’s back. When the examining physician disagreed with the recommendation and an investigation revealed that Harrington had misrepresented his back condition on his pre-employment medical questionnaire, Adriatic brought this action in federal court seeking a declaratory judgment that it did not owe maintenance and cure. Harrington filed a counterclaim asserting that he was entitled to maintenance and cure and punitive damages for willful failure to pay maintenance and cure and that he was entitled to recover under the Jones Act for negligence and under the general maritime law for unseaworthiness. Adriatic asserted a McCorpen (willful concealment) defense to the maintenance and cure claim based on Harrington’s denial that he either currently had or previously had neck or back problems. Harrington claimed that he did not understand the questions, but his testimony at his deposition, where he read and understood other documents, and his completion of a similar questionnaire after this incident in which he denied neck or back problems one day after a visit to the emergency room complaining of back claim, convinced Judge Vitter to disbelieve Harrington. After she concluded that Adriatic had established the elements of the willful concealment defense, Judge Vitter turned to the motions for summary judgment on the counts of Jones Act negligence and unseaworthiness. In his deposition, Harrington testified that he did not know how the accident happened, stating only that he had slipped while stepping on a pipe in the bilge. In response to the motion for summary judgment, Harrington posited that he was a large man and was unable to look at his shoes before attempting to exit the bilge. He argued that the court could therefore reasonably conclude that there was oil on his shoes that caused him to slip. Judge Vitter considered the argument to be pure speculation, however, and dismissed the Jones Act and unseaworthiness counts (see April 2020 Update). The Fifth Circuit affirmed Judge Vitter’s rulings for the reasons given in her opinions. After agreeing that the record contained no evidence of causation, the Fifth Circuit rejected the arguments that Harrington presented to excuse the failure to disclose his prior back conditions. The court noted that it was uncontradicted that he did not disclose his prior back injury and then explained that it was “legally irrelevant whether Harrington had a subjective intent to deceive or whether his subsequent medical history indicated his back was not injured.”
From the federal district courts:
Passenger who slipped and fell on moisture accumulated in outdoor-to-indoor hallway aboard a cruise ship adequately alleged cruise line’s negligence in maintenance and failure to warn; Haynes v. Carnival Corp., No. 20-21921-Civ-Scola, 2020 U.S. LEXIS 243251 (S.D. Fla. Dec. 29, 2020) (Scola).
On May 9, 2019, Thomas Haynes, a passenger aboard the CARNIVAL GLORY, slipped and fell while entering the interior of the ship from an exterior doorway, sustaining injuries. Mr. Haynes brought suit against the cruise line for negligent maintenance and negligent failure to warn, alleging that the cruise line had actual or constructive notice of the dangerous condition because the appearance of wet substances on the interior of outside-to-inside doorways was a “recurring issue” of which the cruise line had knowledge because it had been “discussed frequently” in the cruise line’s internal documents, and the cruise line had unsuccessfully attempted to address the issue. Additionally, Haynes alleged that the floor surface had been documented as being below the minimum safety standards for passenger safety. The cruise line moved to dismiss for failure to state a claim, alleging lack of notice of the dangerous condition and that the complaint’s allegations were made without any factual basis. Judge Scola disagreed, finding that the complaint sufficiently alleged notice. Judge Scola also concluded that the count for negligent maintenance was adequately pleaded, plainly stating that the area in question accumulated moisture such that it was unreasonably slippery. Similarly, Judge Scola ruled that Haynes adequately pleaded negligent failure to warn, because the duty to warn encompasses dangers of which the carrier knows, or reasonably should have known and the complaint satisfied that standard by alleging that the cruise line knew of the existence of the moisture accumulation and failed to place signage or orally warn of the danger.
Cruise passenger’s amended complaint as a class action against the cruise line for its role in passengers’ exposure to and contraction of COVID-19 was an improperly pled shotgun pleading; cruise line’s actions were not extreme and outrageous to support a claim for intentional infliction of emotional distress; Kantrow v. Celebrity Cruises, Inc., No. 20-21997, 2020 U.S. Dist. LEXIS 245374 (S.D. Fla. Dec. 29, 2020) (Lenard).
Fred and Marlene Kantrow, who contracted COVID-19 while passengers aboard the Celebrity ECLIPSE, filed a complaint against the cruise line on behalf of themselves and similarly situated passengers who sailed aboard the cruise ship, alleging that the cruise line created a heightened risk of exposure to COVID-19. Judge Lenard found the initial complaint was a shotgun pleading, failing to separate each cause of action, and the Kantrows filed an amended complaint as a class action, alleging that they and the class of passengers contracted COVID-19 and/or were exposed to a heightened risk while aboard the ECLIPSE a result of the cruise line’s careless conduct. The amended complaint asserted 21 counts, including negligent failure to warn, negligent management of infectious disease outbreak, negligent boarding, general negligence, and negligent and intentional infliction of emotional distress. Judge Lenard reasoned that because the amended complaint failed to identify the individual harms suffered by the plaintiffs, it was a shotgun style pleading, enumerating “a laundry list of injuries at the end of [each count] without specifying who suffered what.” Additionally, because of the nature of the pleading, the Kantrows did not have standing to assert claims on behalf of the putative class members who suffered injuries that they themselves did not suffer. Judge Lenard dismissed the amended complaint without prejudice, granting leave to make final amendments. Despite not deciding the merits of the claim of “negligent boarding,” Judge Lenard concluded that a cruise passenger could plausibly allege negligence during the boarding process and dismissal of that count with prejudice would be improper. However, with respect to the claim that the cruise line’s concealing the truth regarding the nature of COVID-19 aboard the ship constituted intentional infliction of emotional distress, Judge Lenard dismissed the count with prejudice. Judge Lenard found that the alleged acts did not rise to the level of extreme and outrageous behavior that is required for a claim of intentional infliction of emotional distress.
Seaman who claimed a shoulder injury while in the vessel’s service was not entitled to maintenance and cure because he fraudulently concealed a prior shoulder injury and surgery in his pre-employment paperwork; Williams v. Magnolia Marine Transp. Co., No. 20-196, 2020 U.S. Dist. LEXIS 244430 (E.D. La. Dec. 30, 2020) (Vance).
Carlos L. Williams claimed that he injured his shoulder when he fell while serving as a seaman on the M/V JODY MCMINN. He brought this action against his employer, Magnolia Marine Transport, which filed a motion for partial summary judgment asserting that Williams was not entitled to maintenance based on a McCorpen willful concealment defense. Williams indicated on several pre-employment forms that he had no medical history of shoulder injuries or surgery; however, he later testified that he had sustained a prior unrelated injury to his shoulder and underwent surgery to treat it. Judge Vance found that Magnolia Marine Transport had established its McCorpen defense because Williams knowingly or fraudulently concealed his injury (established by his failure to disclose in the form intended to elicit such information). Williams asserted that he suffered a learning disability that affected his ability to comprehend the nature of the question. However, Judge Vance did not accept that explanation as Williams demonstrated that he could read and understand forms during his deposition. Judge Vance also found that the facts regarding Williams’ condition were material to Magnolia Marine’s hiring decision, as they went to William’s ability to perform job duties as a deckhand, tankerman, and relief mate. Magnolia Marine sufficiently proved the causation element of the defense by the fact that the injury sustained during employment affected the same shoulder that Williams previously injured. Consequently, Judge Vance dismissed Williams’ maintenance and cure claim.
Fleeting service failed in its burden of proving that a barge that sank at its facility was unseaworthy at the time it took custody of the barge; Terral River Serv. Inc. v. SCF Marine, Inc., No, 3:19-cv-00406, 2020 U.S. Dist. LEXIS 245025 (W.D. La. Dec. 30, 2020) (Doughty).
After excluding Plaintiff Terral’s expert testimony, the Defendant (barge operator, SCF Marine), moved for summary judgment on Terral’s claim for savage expenses from removal of a barge at its fleeting facility that was supplied by SCF Marine to be loaded with rice. The barge took on water and partially submerged, damaging the rice cargo, resulting in the salvage operations by Terral. The submersion was caused by a fracture in the barge’s bow rake knuckle; however, several inspections prior to the incident, including one twenty minutes prior performed by an experienced Terral employee, revealed no such damage. The fracture seemingly revealed green paint marks, and Terral possessed at least two green barges in its fleet. Terral claimed that the fracture existed prior to their control of the Barge and was caused by SCF’s negligence. Despite the fact that Terral’s primary evidence that the damage occurred prior to their control of the barge had been excluded, Terral argued that SCF bore the burden of proving that the barge was seaworthy at the time of delivery and that SCF could not prove such. However, Judge Doughty disagreed with Terral, concluding that Terral must prove that it suffered damages because the barge was unseaworthy and that SCF was negligent in their handling of the barge. The court similarly found that Terral had no such evidence to prove that the fractured occurred while the barge was in SCF’s possession.
BP was awarded costs after voluntary dismissal of BELO suits; Banda v. BP Exploration & Production, Inc., No. H-19-1165, 2020 U.S. Dist. LEXIS 244373 (S.D. Tex. Dec. 30, 2020); Juarez v. BP Exploration & Production, Inc., No. H-19-3369, 2020 U.S. Dist. LEXIS 245205 (S.D. Tex. Dec. 30, 2020) (Hughes).
Rodolfo Banda and Jesus Juarez were cleanup workers in connection with the DEEPWATER HORIZON incident who brought Back-End-Litigation-Option suits against BP. Their lawyer, who filed 88 parallel cases, dismissed most of the cases voluntarily, including the suits by Banda and Juarez. However, BP sought costs for recording and transcribing depositions, including translation and service of a subpoena. Concluding that the workers were unable to overcome the strong presumption in favor of the award of costs, Judge Hughes awarded BP costs of $3,835.23 against Banda and $3,839.88 against Juarez.
Signs and cones are not evidence of notice of a specific spot of water; slip and fall in the area ten minutes before the accident was insufficient to provide notice; Brady v. Carnival Corp., No. 19-22989, 2020 U.S. Dist. LEXIS 245775 (S.D. Fla. Dec. 31, 2020) (Cooke).
Mary Brady slipped and fell in a puddle of water on the Lido deck of the Carnival SUNSHINE in dry weather while the vessel was moored at Port Canaveral, Florida. She brought this suit against the cruise line, which moved for summary judgment on the ground that the condition was open and obvious and that there was no evidence that Carnival had notice of the risk-creating condition. Judge Cooke granted the motion on the notice ground. Brady cited the cruise line’s evidence that the area was apparently wet due to its proximity to the pool and passengers coming out of the pool with wet clothing. To establish actual notice, Brady cited the testimony of one of her companions that there were cones in place at the time and location of the accident and that she had witnessed a similar fall a few minutes before the accident, as well as the presence of a sign that the deck area is expected to become wet due to weather and passengers’ use of the swimming pool. Brady cited a case in which notice was found from the placement of a warning sign after it had rained. However, Judge Cooke distinguished the case of an entire deck being wet after rain from a specific spot of water on a hot, dry deck. The fact that the cruise line expected passengers and rain to cause the deck to become wet did not create an inference that the cruise line knew of the existence of the puddle of water in which Brady slipped. Judge Cooke also denied that the testimony of Brady’s traveling companion of the prior incident was sufficient notice to the cruise line as there were no crew members in the area and no evidence that the cruise line became aware of the condition in the interval after the accident.
Mortgagee provided sufficient evidence of execution and recording of mortgage on Mexican vessel to support judgment on arrested vessel; Caterpillar Financial Services Corp. v. IZTACCIHUATL 2501, No. 20-1521, 2020 U.S. Dist. LEXIS 244996 (E.D. La. Dec. 31, 2020) (Africk).
Caterpillar Financial Services arrested the IZTACCIHUATL 2501 for the owner’s default on the loan on the Mexican-flagged barge that was secured by a preferred ship mortgage. The mortgagee asserted that it had a lien based on a preferred ship mortgage under the Commercial Instruments and Maritime Liens Act as the mortgage was executed and recorded under the laws of Mexico. The mortgagee supported its motion for summary judgment with a scan of the recorded mortgage, bearing the Mexican registrar’s seal and a declaration from a Mexican attorney stating that the mortgage was valid under Mexican law. The owner asserted that the evidence was insufficient to establish the validity of the mortgage and lien, but Judge Africk disagreed. The owner contended that the mortgagee failed to provide notice of foreign law under Rule 44.1, but Judge Africk noted that the mortgagee had given sufficient notice in its complaint and in its motion for summary judgment with the declaration that the mortgage was valid under Mexican law. Judge Africk therefore entered judgment against the vessel for the amount due on the loan, plus interest and custodial fees.
Overlooking mandatory forum-selection clause in yacht transportation contract did not save the case from forum non conveniens dismissal; dismissal did not make the defendant a prevailing party entitled to attorney’s fees; Asset Recovery Management, Inc. v. United Yacht Transport LLC, No. 20-61913, 2021 U.S. Dist. LEXIS 1434 (S.D. Fla. Jan. 3, 2020) (Cannon).
Asset Recovery Management contracted with United Yacht Transport to transport its yacht from Greece to Fort Lauderdale, Florida. Asset Recovery paid $30,000 as a deposit, but United Yacht failed to meet the delivery deadline, causing Asset Recovery to arrange alternative transportation. United Yacht declined to return the deposit, and Asset Recovery brought this action in the federal court for the Southern District of Florida seeking to recover its additional expenses and return of the deposit. United Yacht responded by moving to dismiss the case on the basis of forum non conveniens, citing the mandatory forum selection clause (17) in the contract between the parties for the Circuit Court in Broward County, Florida. In defense, Asset Recovery cited the Choice of Law and Forum Selection Clause (21) in the contract that only provided that United Yacht would be relieved of liability if a claim was not initiated within a year after delivery, and admitted that it had overlooked Clause 17. Finding that the forum-selection clause was valid and mandatory and that there were no public interest factors that weighed against enforcement of the clause, Judge Cannon dismissed the case based on forum non conveniens. United Yacht requested attorney’s fees in accordance with the contractual provision that the prevailing party in litigation arising out of the contract was entitled to attorney’s fees; however, Judge Cannon held that a dismissal under the doctrine of forum non conveniens did not make United Yacht a prevailing party and denied the request.
Terminal was allowed to add the ILA as a defendant in its suit alleging that the ship pilots and the ILA conspired to keep ships from navigating to and from the terminal; Midwest Terminals of Toledo International, Inc. v. International Longshoremen’s Association, No. 3:18-cv-2560, 2021 U.S. Dist. LEXIS 353 (N.D. Ohio Jan. 4, 2020) (Helmick).
Midwest Terminals of Toledo brought this litigation asserting that the Lakes Pilot Association and the International Longshoremen’s Association conspired to prevent ships operated by international shipping companies from navigating to and from the Toledo Port operated by Midwest Terminals. Midwest asserted that the pilots and the ILA improperly set up a picket line to provide an excuse for the pilots to refuse to board and navigate ships. Earlier in the litigation, Midwest Terminals dismissed the ILA without prejudice but then Midwest Terminals moved for leave to add the ILA as a defendant. Concluding that discovery and motion practice had not proceeded to the point that it was prejudicial to add the ILA, Judge Helmick allowed the amendment.
Daniel Beech brought this action against Adriatic Marine asserting that he was injured while working as an engineer on the M/V CARIBBEAN when he was turning off the starboard emergency fuel shutdown valve. Beech designated D.J. Green, a retired Coast Guard Commander, to provide opinions with respect to the liability of Adriatic Marine and the comparative fault of Beech. Adriatic Marine presented a motion in limine to exclude the opinions, and Judge Africk granted the motion. Although Judge Africk noted that Commander Green’s opinions had been excluded in other cases, he did not base his decision on the prior exclusions but instead on the impermissible nature of the opinions. Green’s first opinion, that the cause of the accident was the failure to provide Beech with a safe place to work free of hazards like the stuck valve cap, was not an opinion requiring scientific or other specialized knowledge but was based on common sense and was a conclusion that answered the question that the jury would consider. Green’s second opinion, that the accident was preventable and could have been avoided if the defendant had a policy or procedure to maintain reasonable access to the valve, did not explain how a policy could conceivably have prevented the injury. Green’s third opinion, that Beech conducted himself in a manner that was appropriate for a seaman, did not explain how the testimony was relevant. Finally, Green’s fourth opinion, that Beech did not cause or contribute to the cause or causes of the accident, was simply a statement that Green was not comparatively at fault.
Consignee’s obligation to pay demurrage is independent of the carrier’s obligation to deliver the cargo in good order, but the amount owed was reduced for the carrier’s failure to mitigate; Shelter Forest International Acquisition, Inc. v. Cosco Shipping (USA) Inc., No. 3:19-cv-1259, 2021 U.S. Dist. LEXIS 1941 (D. Ore. Jan. 6, 2021) (Russo).
Shelter Forest contracted with Cosco Shipping to transport containerized cargo from China to the United States. A dispute arose when one of Cosco’s containers was damaged in a rollover accident—whether the cause was negligent driving by Cosco or Shelter Forest’s improper loading of the container. Cosco held the cargo in a container yard while the parties debated responsibility for damage to the cargo and container, and Cosco began charging demurrage in accordance with its terms and conditions that were on the back of its bill of lading, on its website, and on file with the Federal Maritime Commission. Eventually Shelter Forest took possession of the goods without paying demurrage, and Cosco brought a counterclaim in this suit seeking to recover the demurrage. Shelter Forest cited cases for the proposition that a carrier is not entitled to recover demurrage incurred as a result of the fault of the carrier, but Magistrate Judge Russo held that those cases only apply to demurrage for delay caused by the carrier. That rule was not applicable in this case where the bill of lading provided for demurrage and a lien on the goods without regard to setoff (Magistrate Judge Russo added that the facts reflected that the damage was caused by improper loading, which gave Cosco a basis to withhold delivery of the cargo). Judge Russo did reduce Cosco’s recovery, however, for failure to mitigate damages because it did not deliver the cargo when Shelter Forest was ready and willing to pay the disputed charges to retrieve its cargo.
Court enforced forum-selection clause in passenger’s ticket and transferred the passenger’s suit to the Southern District of Florida; Sterling v. Carnival Corp., No. 3:20-cv-1142, 2021 U.S. Dist. LEXIS 1736 (D. Conn. Jan. 6, 2021) (Dooley).
Suraya Sterling booked a cruise on the CARNIVAL CONQUEST that embarked from Miami, and two days before the departure the cruise line emailed her boarding pass and passenger ticket to her. She acknowledged that she had received and accepted the terms and conditions in the cruise line’s contract. Sterling slipped and fell on the ship and brought this suit against the cruise line in federal court in Connecticut. The cruise line moved to transfer the case to the Southern District of Florida based on the forum-selection clause in the contract, and Sterling objected that the clause had not been reasonably communicated to her and was unreasonable. Sterling complained that the cruise line had not called her attention to the forum-selection clause prior to her purchase of the ticket, but Judge Dooley noted that the communication test only requires that the passenger have the opportunity to review the ticket terms before embarkation, which was satisfied in this case. As Florida is not a remote alien forum and the dispute is suited to resolution in Florida where the vessel departed, Judge Dooley concluded that the clause was not unreasonable or unjust and ordered the transfer of the case.
Ocean carrier was ordered to explain why it was afforded a private right of action under the Shipping Act or federal regulations that would give the federal court jurisdiction over its claim against a freight forwarder; Yang Ming Marine Transportation Corp. v. JAC Shipping, Inc., No. 20-cv-1118, 2021 U.S. Dist. LEXIS 4121 (E.D.N.Y. Jan. 7, 2021) (Reyes).
Ocean carrier Yang Ming brought this action seeking to recover amounts the carrier paid to a freight forwarder for shipments made for companies in which the freight forwarder had a beneficial interest. The carrier asserted that the freight forwarder’s interest violated the federal regulation (46 C.F.R. § 515.42(i)) prohibiting freight forwarders from receiving compensation from a common carrier with respect to shipments in which the forwarder has a beneficial interest. When the freight forwarder did not answer the complaint, the carrier moved for a default judgment. Instead of granting relief, however, Magistrate Judge Reyes recommended that the carrier be required to show cause why the complaint should not be dismissed for lack of subject matter jurisdiction. Magistrate Judge Reyes reasoned that there was nothing in the regulation that afforded a private cause of action to the carrier, nor did the Shipping Act of 1984 afford such an action. Without a statutory right for the action, the carrier would have to demonstrate the basis for federal jurisdiction over its suit.
Court applied state law designated by the marine insurance policy to hold that receipt of notice of cancellation of the policy was not a condition to cancellation of the policy and that attorneys’ fees were not recoverable by the insurer; GEICO Marine Insurance Co. v. Carnes, No. GJH-19-1457, 2021 U.S. Dist. LEXIS 3865 (D. Md. Jan. 8, 2021) (Hazel).
GEICO Marine issued a marine insurance policy to Robert Carnes for his 32-foot Regal yacht for a policy period from September 7, 2017, to September 7, 2018. Carnes set up automatic credit card payments for the premiums, but his cards were declined on two occasions, and he received emails from GEICO of the declinations. GEICO cancelled the policy on March 29, 2018, and the cancellation notice was mailed to Carnes at the address listed on the policy’s application. Carnes asserted that he did not receive the mailed notice. On August 24, 2018, the vessel suffered a major fire loss, and GEICO brought this action seeking a declaratory judgment that the policy had been cancelled. Judge Hazel first had to decide what law to apply, and, following Wilburn Boat, he held that he was unaware of a specific and controlling federal rule and that state law would consequently apply. Applying federal maritime choice-of-law rules to determine which state’s law to apply, Judge Hazel held that the policy’s choice of the law of the state of the insured’s address on the Declaration Page of the policy would be enforced—South Carolina. Under South Carolina law, actual receipt by the insured is not a condition precedent to the cancellation of the policy. Consequently, Judge Hazel held that GEICO had done what was necessary to cancel the policy and that the policy did not afford coverage for the fire. The final issue was whether GEICO was entitled to recover attorneys’ fees. Although admiralty law does not provide for recovery of attorneys’ fees in actions for breach of contract, Judge Hazel noted that the courts have differed on whether that rule applies in the context of marine insurance contracts. Judge Hazel did not have to determine whether to apply the maritime rule or state law as South Carolina common law does not provide a right to attorneys’ fees absent a statute or contractual provision.
Luring a passenger onto a cruise ship with promises of safety is not fraud that renders unenforceable the forum-selection clause in the contract of passage; Campbell v. Princess Cruise Lines, Ltd., No. 20-cv-4955, 2021 U.S. Dist. LEXIS 4080 (N.D. Cal. Jan. 8, 2021) (Gilliam).
Carl E. Weidner died of COVID-19 that he allegedly contracted during a voyage on the GRAND PRINCESS. His estate brought this action in the Northern District of California, arguing that the forum-selection clause for the Central District of California in Los Angeles was too vague to be enforceable and was voided by the fraud of the cruise line in luring Weidner to take the cruise by false promises of the safety of the cruise. After finding the clause to be clear, Judge Gilliam addressed the fraud exception to the enforceability of forum-selection clauses and noted that the inclusion of the forum-selection clause in the contract must have been the product of fraud or coercion. As none of the representations identified by the Estate were related to the forum-selection clause, and as there were no exceptional hardships that would make enforcement of the clause unreasonable or unfair, Judge Gilliam transferred the case to the Central District of California.
Jones Act claim for injury on a yacht was not properly subject of a motion to dismiss for lack of subject matter jurisdiction and stated a claim for false imprisonment under the general maritime law; Butts v. ALN Group, LLC, No. 20-cv-61715, 2021 U.S. Dist. LEXIS 4259 (S.D. Fla. Jan. 8, 2021) (Ruiz).
Stephanie Marie Butts claimed that she was hired as a chef on ALN Group’s yacht, M/Y REVIVE. She quit the job when the beneficial owner of the yacht, David Allen, who allegedly used illegal drugs and drank to excess, was verbally, physically, and sexually abusive toward her. After Allen promised to treat her professionally, she returned to the vessel and was injured when Allen took control of the yacht’s tender on a fishing trip in an allegedly drug-induced state and began recklessly operating the tender in an attempt to swamp another vessel that he contended was operated by pirates who needed to be killed. Allen allegedly confined Butts to the cabin on the tender where she was violently thrown about. Butts brought this action against the yacht owner and beneficial owner for Jones Act negligence, failure to pay maintenance and cure, unseaworthiness, and false imprisonment. The defendants asserted that Butts was not a crew member and instead was Allen’s guest. As the defendants contended that Butts was not a seaman, they moved to dismiss the complaint for lack of subject matter jurisdiction. Noting that the complaint actually alleged a claim under the Jones Act and general maritime law, Judge Ruiz first ruled that a motion to dismiss was not the proper vehicle to address whether Butts was a crew member. Instead, the issue would have to be raise in a motion for summary judgment (or trial) based on supporting evidence on Butts’ status. The defendants also argued that Butts was not entitled to bring a claim of false imprisonment, citing authority that such a claim was unavailable under the Jones Act. However, Judge Ruiz held that Butts could bring a false imprisonment claim under the general maritime law and that her allegations of false imprisonment were sufficient to survive a motion to dismiss.
Passenger’s allegation of an oral agreement to modify the contractual provisions in her ticket to ensure a safe excursion stated a claim for breach of a non-delegable duty to provide a safe excursion; Martinez v. Celebrity Cruises, Inc., No. 20-23585, 2021 U.S. Dist. LEXIS 4852 (Jan. 8, 2021) (Torres).
Seida Martinez was injured while attempting to board a tour boat during a shore excursion from her cruise ship in the Cayman Islands. The cruise line moved to dismiss Martinez’ allegation of breach of a non-delegable duty to provide reasonably safe conditions for her excursion based on the provision in the ticket contract prohibiting passengers from holding the cruise line liable for breach of contract absent an express contract guaranteeing safe passage. Magistrate Judge Torres rejected the cruise line’s argument, however, based on Martinez’ allegation that she and the cruise line orally agreed to modify the contract to ensure a safe excursion. Her assertion was sufficient to survive a motion to dismiss. Judge Torres also declined to grant the cruise line’s motion to dismiss Martinez’ allegations of apparent agency, negligent section and hiring, and negligent retention, holding that the pleading of these claims was sufficient at the stage of a motion to dismiss.
Failing to expressly plead for exoneration of liability was not a confession of liability, and the deficiency could be corrected by an amended complaint; In re SDS Lumber Co., No. C20-5767, 2021 U.S. Dist. LEXIS 4997 (W.D. Wash. Jan. 11, 2021) (Pechman).
SDS Lumber filed this action in federal court seeking limitation of liability after its tugboat, the DAUBY, collided with a recreational vessel containing Kevin and Jacob Gregory in dense fog while the Gregorys were crossing the Columbia River. In a status report to the court, the Gregorys asserted that SDS Lumber failed to plead exoneration, which amounted to a confession of liability for the collision. In response, SDS Lumber argued that it had pleaded that the main engine of the Gregorys’ vessel died and that the collision was caused without fault or negligence of SDS Lumber. SDS then moved to file an amended complaint that would explicitly disclaim liability by adding the term “exoneration from or” before “limitation of liability.” The Gregorys argued that SDS Lumber could not plausibly and in good faith allege that it was not at fault as the Coast Guard suspended the license of the captain of the DAUBY for two months and found several statutory violations by the DAUBY. However, Judge Pechman noted that the Coast Guard’s findings were not admissible by federal statute, and the allegations with respect to the Gregorys’ crossing the river in dense fog when their engine died were sufficient to plead a case for exoneration (noting that the Gregorys have the burden to establish that SDS Lumber was negligent). As an amendment would not be futile, Judge Pechman allowed SDS Lumber to amend its complaint to state that SDS Lumber sought exoneration from or limitation of liability.
Court declined to lift the stay in a limitation action without stipulations for the parties seeking contribution and indemnity; In re Diamond Services Corp., No. 6:20-cv-408, 2021 U.S. Dist. LEXIS 6212 (W.D. La. Jan. 12, 2021) (Summerhays).
Benjamin Cormier, a hygrographic surveyor, was injured while transferring from the DIAMOND 85, a lay/bury derrick barge, to the M/V CROSBY QUEST, a tug owned and operated by Crosby Marine. Cormier brought suit in state court in Louisiana against Diamond Services, owner of the DIAMOND 85, and Diamond filed this limitation action in federal court. Cormier filed a claim in the limitation action, and claims were also filed by Crosby Marine, seeking contribution and indemnity, and by Cormier’s employer and its LHWCA insurer, Signal Mutual), seeking amounts paid under the LHWCA or for maintenance and cure. Cormier filed a stipulation seeking to lift the stay in the limitation proceeding, but Judge Summerhays declined to lift the stay, noting that parties seeking contribution, indemnity, costs and/or attorney’s fees are claimants under the limitation act and must file proper stipulations in order for the stay to be lifted.
Navy seaman’s evidence of exposure to asbestos was insufficient to survive the shipbuilder’s motion for summary judgment; Gilstrap v. CBS Corp., No. 19-309, 2021 U.S. Dist. LEXIS 6447 (D. Del. Jan. 13, 2021) (Fallon).
Erik Gilstrap worked in the engine room of navy vessels that were constructed by the Electric Boat Division of General Dynamics in Groton, Connecticut. Gilstrap developed asbestosis and mesothelioma, which he attributed to asbestos exposure on the ships. He testified that valves with asbestos were present, but he did not believe that he worked hands-on with them. He saw asbestos insulation materials throughout his service with the Navy, but he did not specify that the materials were present on the vessels built by General Dynamics. He identified pumps with asbestos on one of the vessels, but he did not recall supervising anyone who was repairing that equipment. Applying the causation standard under the general maritime law, Magistrate Judge Fallon recommended that the shipbuilder’s motion for summary judgment be granted because Gilstrap failed to establish the “frequency, regularity, or proximity” of Gilstrap’s exposure to asbestos on the vessels constructed by General Dynamics.
Federal court remanded ocean carriage cargo damage case that was removed under the statute granting jurisdiction for cases arising under statutes regulating commerce; Commissionado de Seguros de Puerto Rico Como Liquador de Real Legacy Assurance Co. v. Crowley Liner Services Puerto Rico, Inc., No. 3:19-cv-1898, 2021 U.S. Dist. LEXIS 7792 (D.P.R. Jan. 14, 2021) (Young).
Commissionado de Seguros de Puerto Rico brought suit in the Superior Court of San Juan against the carrier for damage to a shipment of goods under ocean bills of lading. The carrier removed the case to federal court based on the statute granting federal jurisdiction over cases arising under statutes regulating commerce, and Commissionado moved to remand the case, arguing that its complaint did not allege any cause of action under the Carriage of Goods by Sea Act, the Harter Act, or any other federal statute regulating commerce. Despite decisions such as in the Fifth Circuit’s Uncle Ben’s case (855 F.2d 215, 217), upholding removal jurisdiction because the action could have been brought in federal court “notwithstanding the artful pleading which makes no reference to federal statutes,” Judge Young held that the case was not removable in light of the factual allegations that did not implicate COGSA, the Harter Act, or the ocean bills of lading. Judge Young also rejected admiralty jurisdiction as a basis for removal and then held that the federal forum-selection clause in the bills of lading did not permit removal as the parties cannot confer federal jurisdiction by contract–failing to address the fact that the court did have admiralty jurisdiction and the provision in the bills of lading acted as a waiver of the right to seek remand as the court held in the Maa case (see October 2020 Update) (federal forum-selection clause effectively waived the plaintiff’s objection to removal).
Diversity plaintiff was not allowed to amend his pleading after the pleading deadline to designate Rule 9(h) and waive the previously requested demand for a jury trial; Rocque v. Zetty, LLC, No. 2:18-cv-256, 2021 U.S. Dist. LEXIS 8427 (D. Me. Jan. 15, 2021) (Levy).
Arthur J. Rocque, Jr. brought this action against ship repairer Zetty for damages to Rocque’s vessel M/V AGAINST THE WIND. The complaint was based on diversity jurisdiction and contained a demand for a jury trial. Zetty counterclaimed against Rocque for breach of contract and asserted jurisdiction under both diversity and admiralty within the meaning of Rule 9(h). After the deadline for amendment to pleadings, Rocque filed a waiver of jury to which Zetty objected. Chief Judge Levy rejected the waiver, first noting that the Seventh Amendment right to a jury trial attached from the initial complaint and ruling that Zetty’s counterclaim did not waive its right to a jury trial for the entire claim. Although Rule 15 liberally allows amendment to pleadings, Rule 16 requires good cause after the deadline for amendments in a scheduling order has expired. As the deadline for amendments passed more than two years ago, Chief Judge Levy declined to allow the waiver of a jury trial.
Fishermen on the JOSETTE, a 32-foot Jamaican fishing boat were retrieving fish traps in Jamaican waters when their engine lost power and the boat drifted toward Haiti. The boat was spotted by the officers of the Coast Guard Cutter CONFIDENCE, which suspected the fishermen of drug trafficking. After searching the JOSETTE and finding no drugs, the officers detained the crew for 32 days on several vessels in abysmal conditions, riddled the JOSETTE with bullets, causing it to sink, and killed the fishermen’s fighting cock, Jah Roos. The fishermen pleaded guilty to providing materially false information to a federal law enforcement officer (they now contend they were not guilty) and served ten months in prison and two months in an immigration detention facility. The fishermen brought this suit against the United States under the Suits in Admiralty Act and the Public Vessels Act, asserting eleven counts ranging from false imprisonment to intentional and negligent infliction of emotional distress. The United States moved to dismiss the complaint on the ground that it presented a non-justiciable political question, arguing that the details of the detention are matters of foreign affairs and national security that are constitutionally committed to the political branches. The fishermen responded that the courts are empowered to adjudicate maritime torts pursuant to the framework established by Congress in giving the courts jurisdiction under the Suits in Admiralty Act and the Public Vessels Act. Distinguishing tort claims arising from military or foreign intelligence operations from those arising from law enforcement operations aimed at drug trafficking, Judge Hogan reasoned that the court was not being asked to second-guess actions taken during military engagements. Consequently, he held that most of the claims could proceed without infringing on military, intelligence, or diplomatic decision-making.
Injured boarding agent was entitled to summary judgment on the vessel’s negligence when the owner admitted breach of duty, but there were fact questions whether the agent could recover attorney’s fees under state law; Johnston v. Green Shipping Co. NV, No. 4:20-cv-30, 2021 U.S. Dist. LEXIS 8522 (S.D. Ga. Jan. 15, 2021) (Baker).
Ellen Buice Johnston worked as a boarding agent for ships docking in the Port of Savannah. She was injured while ascending the gangway to Green Shipping’s M/V SEATRADE GREEN. She brought suit against the vessel in state court, and the owner removed the case to federal court based on diversity. Johnston moved for summary judgment that the owner breached its duty to her, and the owner admitted that it breached its duty but denied that the breach was the proximate cause of the damages that Johnston asserted. Judge Baker consequently granted summary judgment as to duty, breach, and causation for the incident, but denied summary judgment on medical causation and damages. Johnston then argued that she was entitled to attorneys’ fees under Georgia law for the owner’s bad faith and stubborn litigiousness that caused her unnecessary trouble and expense. Although the owner argued that maritime law applied and that Johnston was not entitled to recover attorneys’ fees under maritime law, Judge Baker held that state law required the jury to determine whether fees were allowed and the amount of fees. Therefore, the court was not authorized to grant Johnston the relief she sought in the motion for summary judgment.
Seafood processor’s no-fish-no-pay policy did not violate Washington law, but there were fact questions whether it violated federal law; Polly v. E&E Foods, No. C20-1432, 2021 U.S. Dist. LEXIS 9846 (W.D. Wash. Jan. 19, 2021) (Coughenour).
E&E Foods hired Logan Polly to work during the 2019 salmon season as a seafood processor aboard its processing vessel, F/V BEAGLE. Polly was paid an hourly base wage with time-and-a-half for work in excess of 40 hours a week. Polly resided on the vessel during the season, with room and board provided by E&E Foods. E&E had a no-fish-no-pay policy that Polly would not be paid when there were no fish to be processed. Polly brought this suit, challenging the validity of the no-fish-no-pay policy under Washington law and under the Fair Labor Standards Act. As Washington law excluded from its overtime rules individuals whose duties require that the worker reside/sleep at the place of employment, Judge Coughenour concluded that Polly’s claim under state law failed. However, the FLSA applies to time on call that is predominately for the employer’s benefit. Determining whether the on-call time is predominantly for the employer’s benefit requires a fact-intensive inquiry into the agreement of the parties and the freedom the employee has to engage in personal activities while not working that precluded summary resolution of the FLSA claim.
Vessel owner was not required to post additional security in action involving arrest of vessel beyond the security posted in the limitation action; Cox Operating, LLC v. ATINA M/V, No. 20-2845 c/w No. 20-2871, 2021 U.S. Dist. LEXIS 9325 (E.D. La. Jan. 19, 2021) (Milazzo).
Cox Operating arrested the M/V ATINA after the vessel allided with its offshore platform. The owner of the vessel then filed a limitation action and furnished a letter of undertaking in the amount of the vessel and her freight. All of the claims against the vessel were stayed, including the in rem action, which was consolidated with the limitation action. Cox Operating then requested that the vessel owner be required to post a separate bond in favor of Cox in the in rem action, arguing that, having arrested the vessel, Cox was entitled to its own security rather than the limitation security that favored all possible claimants. Cox cited authority that a letter of undertaking provided in the in rem action did not satisfy the requirement for security in a limitation action. Judge Milazzo distinguished that case, however, as that decision did not stand for the proposition that vessel owner can be made to post additional security in the in rem action in favor of one claimant after posting security for all claims in the limitation action.
Luzar Trading purchased a cargo of soymeal and soybeans to be shipped from IFG Port Holdings’ terminal in Lake Charles, Louisiana. Luzar Trading subchartered the M/V SREDNA GORA from Sagitta Marine, which chartered the vessel from Sredna Gora Maritime. A fire broke out at the terminal during the loading of the cargo on the vessel, which delayed loading. The terminal then invoiced the charterers and owner for the cost of overtime after the damage was repaired based on the provision in the terminal’s tariff that was incorporated into the contract between the terminal and the charterers. When the charterers and owner declined to pay the overtime, the terminal brought this suit to recover the overtime. The tariff gave the terminal the discretion to charge overtime if the elevator at the terminal was congested, but it also gave the vessel the right to refuse the overtime and vacate the terminal. As the terminal did not give the vessel any notice that it was going to charge overtime so that the vessel could vacate the premises or accept the overtime, Judge Doughty held that the charterers had not agreed to pay overtime and dismissed the terminal’s claim against the charterers. In a second opinion, Judge Doughty dismissed the claim against the vessel owner as the vessel owner was not party to the contract, noting the difference between an in rem claim against the vessel and an in personam claim against the vessel owner as in this case.
Court confirmed arbitration award in favor of vessel against ship repairer for failure to complete the work on the vessel and wrongful arrest; Robert E. Derecktor, Inc. v. M/Y INDEPENDENCE, No. 15-cv-8257, 15-cv-9372, 2021 U.S. Dist. LEXIS 10353 (S.D.N.Y. Jan. 20, 2021) Briccetti).
These cases involve a dispute over the repair of the M/Y INDEPENDENCE by Robert E. Derecktor, Inc. Derecktor filed a demand for arbitration and brought an action arresting the vessel. The owner brought an action demanding repossession of the yacht and alleging breach of contract, negligence, gross negligence, breach of the warranty of workmanlike performance, fraud, and wrongful arrest. Derecktor was awarded $56,106.75 in the first phase of the arbitration, which was confirmed by the court, and the vessel owner was awarded $1,628,754 in the second phase of the arbitration. The owner sought to confirm that award, and Derecktor objected that the arbitration panel exceeded its authority and disregarded the law. Applying the extremely deferential standard for review, Judge Briccetti concluded that Derecktor had failed to carry its burden and confirmed the award in favor of the owner.
Court declined to require inspection or evidence from the sister ship to the one on which the captain was injured; In re CSS Virginia, LLC, No. 20-71, 2021 U.S. Dist. LEXIS 10709 (M.D. La. Jan. 20, 2021) (Johnson).
Jackson M. Jenkins, captain of the M/V CSS VIRGINIA, was injured while disembarking from the vessel during a crew change. The M/V ALBERMARLE, a sister ship to the CSS VIRGINIA had made a crew change at the same location immediately prior to the crew change of the CSS VIRGINIA. Jenkins sought an inspection of the ALBERMARLE, access to its video/audio recording equipment during the crew change, and access to electronically stored information from the ALBERMARLE for the day of the crew change. Magistrate Judge Johnson denied the request. With respect to the inspection, Jenkins did not establish how the inspection of a different ship would be relevant to this suit, and the inspection would be unduly burdensome to the defendant as the vessel was a fully-crewed, working vessel. Similarly, Magistrate Judge Johnson held that Jenkins failed to establish the relevance of the request for video/audio recordings on the ALBERMARLE, and failed to reasonably limit the request. Finally, Magistrate Judge Johnson denied the request for electronically stored information without prejudice, requesting the parties try to reach an amicable resolution of the issue.
Offshore worker, injured in the decommissioning of a platform, who spent 50% of his time on vessels that were not under his employer’s common ownership or control was not a seaman; Price v. Quality Energy Services, Inc., No. 17-01279, 2021 U.S. Dist. LEXIS 12562 (W.D. La. Jan. 22, 2021) (Kay).
Jared Price was injured while working as a plug and abandon helper on a platform in the Gulf of Mexico. He brought this action against his employer, a contractor hired to assist in decommissioning the platform, as a seaman under the Jones Act. Price argued that he was a seaman because he spent 50% of his work time on one of two lift boats that assisted in his work to decommission the platform. As Price worked on whatever vessel happened to be at the platform, and as the vessels were hired by the platform owner from different entities and were not under the employer’s common ownership or control, Magistrate Judge Kay granted the employer’s motion for summary judgment and dismissed Price’s claims as a seaman.
Vessel owner was unable to establish the terms of its P&I policy from 1946 to 1947 to afford coverage for settlements of seamen’s asbestos-exposure cases; Cosmopolitan Shipping Co. v. Continental Insurance Co., No. 19-cv-3167, 2021 U.S. Dist. LEXIS 12269 (S.D.N.Y. Jan. 22, 2021) (Schofield).
Cosmopolitan Shipping entered into settlements with seamen who alleged injuries from exposure to asbestos while sailing on ships that it chartered in the 1940s. Cosmopolitan then sought insurance coverage under a Continental protection and indemnity policy issued for the period from 1946 to 1947 that covered the United Nations Relief and Rehabilitation Administration for which Cosmopolitan chartered the vessels on which the seamen were exposed to asbestos. Cosmopolitan sought to establish insurance coverage by relying on secondary evidence of the terms of the policies as Continental was not able to find any policy for the relevant time frame. Based on a three endorsements that were located, Judge Schofield was able to conclude that Continental had issued an open-cover P&I policy covering injuries and deaths, and Cosmopolitan tried to provide evidence of the terms of the policy based on other policies that were issued at the time. However, there were not enough similarities in the other policies (particularly because the Continental policy was an open-cover policy) to allow Judge Schofield to ascertain policy terms such as how much insurance Continental had agreed to provide. Consequently, Judge Schofield held that Cosmopolitan had failed to establish that it was afforded coverage for the settlement of the asbestos claims.
Crew members had a maritime lien under Cayman Islands law for unearned wages, repatriation expenses, unpaid vacation, and penalty wages, but the amounts sought were inflated; the vessel owner was entitled to recover against the captain based on conversion for equipment, supplies, and furnishings he removed; Versilia Supply Service SRL v. M/Y WAKU, No. 18-62975, 2021 U.S. Dist. Lexis 12893 (S.D. Fla. Jan. 22, 2021) (Cohn).
This action resulted from the freezing of assets of the beneficial owner of the M/Y WAKU, registered in the Cayman Islands, which was sold for $20,575,000 at a judicial auction. In a nonjury trial, Judge Cohn addressed the lien claims that were asserted against the vessel. Crewmembers brought wage claims based on their contracts that were governed by the law of the vessel’s flag. Applying the law of the Cayman Islands, Judge Cohn held that the crew members had liens for unearned wages, repatriation expenses, unpaid vacation days, and penalty wages. He also found that the claims were inflated and reduced the amounts awarded. Judge Cohn did not find that any severance was allowed under the agreements signed by the crew or under Cayman Islands law. Judge Cohn awarded judgment on the counterclaim against the captain of the vessel for conversion as the captain had removed appurtenances, equipment, furnishings, and supplies that were the property of the vessel and denied the claim of the company beneficially owned by the captain for necessaries (based on credit card balances) because there was no evidence establishing what was purchased to support the credit card balances.
Rule 14(c) tender bypassed arbitration and forum-selection clauses; Chembulk Ocean Transport LLC v. Valero Marketing & Supply Co., No. 20-1024, 2021 U.S. Dist. LEXIS 14845 (S.D. Tex. Jan. 25, 2021) (Miller).
Chembulk entered into a contract with a supplier of bunkers to deliver fuel to its vessel M/T CHEM RANGER. The supplier arranged for Valero to deliver the bunkers to Chembulk, and Valero obtained the bunkers from Trafigura. The bunkers were contaminated, and Chembulk brought this suit against Valero for damage to its vessel. Valero answered the suit and brought a third-party action against Trafigura pursuant to Fed. R. Civ. P. 14(c), which allows the defendant to tender the third-party defendant (Trafigura) directly to the plaintiff (Chembulk). Trafigura argued that Valero could not bring the third-party claim against Trafigura because the contract between Valero and Trafigura contained arbitration and forum-selection clauses. Trafigura cited a similar case decided by Chief Judge Rosenthal involving Valero’s supply of contaminated bunkers to National Shipping Co. (see August 2020 Update) in which Judge Rosenthal held that the Rule 14(c) tender did not overcome the arbitration and forum-selection clauses between Valero and Trafigura. In the Chembulk case, Judge Miller distinguished the National Shipping decision on the ground that Valero asserted claims against Trafigura on its own behalf. In this case, Valero asserted no claims on its own behalf that would invoke the arbitration and forum-selection clauses in its contract with Trafigura. The claim was purely one in which Trafigura was tendered directly to Chembulk for Trafigura’s liability to Chembulk. The claim by Chembulk against Trafigura did not implicate the terms of the contract between Trafigura and Valero. As there was no arbitration or forum-selection clause governing the dispute between Trafigura and Chembulk, Trafigura’s motion to sever and transfer was denied. Trafigura finally asked Judge Miller to reassign the case to Judge Rosenthal, who had ruled in Trafigura’s favor in the National Shipping case, but Judge Miller denied the motion.
Passenger’s complaint for injury on FlowRider Surfing Simulator sufficiently alleged actions for failure to warn, failure to maintain, negligent design, and punitive damages; Baldoza v. Royal Caribbean Cruises, Ltd., No. 20-22761, 2021 U.S. Dist. LEXIS 13024 (S.D. Fla. Jan. 25, 2021) (Moreno).
Rommel Baldoza, a passenger on the SYMPHONY OF THE SEAS, was injured while participating in the onboard attraction, the FlowRider Surfing Simulator. He asserted that the FlowRider had been modified to fit the attraction onto the deck of the cruise ship, which caused it to be more dangerous. The cruise line moved to dismiss the complaint, but Judge Moreno ruled that Baldoza had sufficiently alleged failure to warn and failure to maintain, although he ordered Baldoza to replead the counts for negligent hiring, training, supervision, and retention. Judge Moreno noted that the courts had denied strict liability claims of passengers against cruise lines, but Baldoza argued that his claim was for the negligent modification of the FlowRider and Judge Moreno advised that the legal issue raised by the argument should be presented by a motion for summary judgment. Finally, the cruise line argued that the claim for punitive damages should be dismissed based on the 11th Circuit’s ruling in Eslinger v. Celebrity Cruises that punitive damages are not available for maritime personal injury cases. Judge Moreno noted that some district courts had held that punitive damages could be recovered in the event of intentional conduct, and he denied the motion with leave to raise it at the summary judgment stage.
This case was brought by American River Transportation against the ORIENT RISE, asserting a maritime lien for necessaries in connection with the loss of the ORIENT RISE’s starboard anchor and chain. In April 2020, the court granted an agreed motion to stay the case due to the effects of the COVID-19 pandemic and the complications from the vessel owners’ operations being based in mainland China. Six months later, the plaintiff (and intervening lienor) sought to lift that stay for the litigation to proceed. The vessel owners argued that the pandemic continued and that their metallurgical expert was unable to travel to participate in the destructive testing on the anchor chain. Chief Judge Brown held that a continued stay of the litigation was no longer warranted, noting that the court was setting jury trials and that if the case remained stayed it would not be set for trial until late 2022. She added that discovery issues, including additional time for the destructive testing, could be addressed after the stay was lifted.
Allegation that the garnishee reasonably believes the garnishee holds accounts that are the property of the defendant was insufficient to support a Rule B garnishment; Australasia Charterers Ltd. v. Worldwide Bulk Shipping Pte Ltd., No. C21-98, 2021 U.S. Dist. LEXIS 16576 (W.D. Wash. Jan. 28, 2021) (Martinez).
Worldwide Bulk Shipping chartered a vessel from Australasia Charterers to carry coal from Australia to China. The vessel could not discharge the coal in China, however, because China halted the importation of coal from Australia. The parties initiated an arbitration proceeding in London, and Australasia Charterers brought this proceeding seeking to garnish property as security for its claims in the arbitration. Judge Martinez found the complaint was sufficient to establish the right to garnish property belonging to Worldwide Bulk Shipping; however, the assertion that Australasia reasonably believes that the garnishee holds accounts which are the property of Worldwide Bulk Shipping was factually insufficient to establish a plausible right to garnishment with respect to the garnishee. The garnishment was denied without prejudice.
Motion to compel cure (surgery) had to be determined under a summary-judgment standard and was denied, but the court agreed to an expedited bifurcated trial; Davis v. Brunsman, No. 3:19-cv-1221, 2021 U.S. Dist. LEXIS 16348 (D. Ore. Jan. 28, 2021) (Acosta).
Cory Davis, a deckhand on the F/V ALERT, brought this suit against the owner of the vessel for injuries he claimed to have suffered when the vessel sank in a storm. Eventually a dispute arose over the recommendation for cervical surgery, which was denied by the owner. Davis moved to compel surgery under the owner’s cure obligation, and Magistrate Judge Acosta reviewed the authorities, included the decision of the Ninth Circuit in Barnes, and concluded that Davis’ entitlement to surgery had to be decided using a summary-judgment procedure. Here, there were significant questions of relatedness and medical causation (proper diagnosis of the cause for his neck and radiating arm pain, whether that condition occurred or became aggravated during his service on the vessel, and whether the surgery was a necessary and proper cure). Therefore, an order on surgery could not be resolved by a motion to compel. However, Magistrate Judge Acosta advised that the court would be willing to address the surgery in an expedited, bifurcated trial to which the vessel owner was not opposed.
Stevedore could be liable to a vessel for selecting a dangerous berth (not leased or controlled by the stevedore) to discharge the vessel’s cargo; Antares Maritime Pte v. Board of Commissioners for the Port of New Orleans, No. 18-12145, 2021 U.S. Dist. LEXIS 17160 (E.D. La. Jan. 29, 2021) (Vitter).
The M/V PAC ANTARES called at the Port of New Orleans to have cargo discharged by stevedore Ports America. The Board of Commissioners for the Port of New Orleans contacted Ports America (who was contracted by the time charterer to perform the discharge) to determine where to assign the vessel to berth, and was advised to locate the vessel at the Nashville Avenue Wharf. When the vessel docked at the wharf, it came in contact with a ro-ro plate that punctured a fuel tank. The vessel owner then brought this suit against the Board of Commissioners and Ports America seeking to recover for damage to the vessel. Ports America leases space in the Port of New Orleans, but not the wharf where the damage occurred. It moved for summary judgment that it owed no duty to the vessel because it was not a wharfinger and it did not control the area where the damage occurred. The vessel owner argued in response that another vessel sustained damage from contact with the ro-ro-plates at the wharf two weeks earlier and had sent a letter of protest to Ports America complaining of the protruding steel plate (without a protecting fender). Ports America had promptly notified the Board of Commissioners, but the steel plates continued to protrude two weeks later. Judge Vitter concluded that Ports America did owe a duty to the vessel because it was aware of the hazardous location and chose to request that the vessel be berthed at that location, reasoning that maritime negligence includes a duty to warn where harm is reasonably foreseeable. Although the final decision where the vessel was berthed was made by the Board, and although Ports America had warned the Board about the condition, those factors went to the weight of responsibility for the damage and did not absolve Ports America of its duty to the vessel. Therefore, Judge Vitter denied Ports America’s motion for summary judgment. Thanks to Matthew Ammerman of Houston, Texas, for bringing this case to our attention.
From the state courts:
Aquacultural worker who spent less than 30% of her time associated with vessel-centric activities was not a seaman even though she was exposed to the perils of the sea; Potter v. Great Falls Insurance Co., 2020 Me. 144, 2020 Me. LEXIS 145 (Me. Dec. 29, 2020) (Connors).
Darla J. Potter worked as a marine technician for Cooke Aquaculture’s offshore saltwater salmon farming operation, a mile offshore from Eastport, Maine, for 25 years. Her job was to care for the salmon, which were raised in cages, tending, feeding, and harvesting the fish, as well as cleaning, maintaining, and repairing the pens and nets. She was transported to and from the salmon cages on a large motorized barge or 24-foot skiff. To feed the salmon, she spent time on a feed barge that was anchored to the ocean floor for years at a time and which had no means of self-propulsion. The food was transported to the feed barge. Potter spent 75% of her work day performing work associated with the salmon cages and less than 30% of her hours working on a vessel. She was injured when she slipped and fell on a pipe connected to the salmon cages, and she brought a claim under the Maine Workers’ Compensation Act. Her employer’s carrier controverted the claim on the ground that she was a Jones Act seaman who was excluded from the state law. The Administrative Law Judge concluded that Potter was not a seaman, and the Appellate Division agreed, finding sufficient evidence that Potter spent less than 30% of her working hours on or in service of a vessel. Before the Maine Supreme Court, the carrier argued that all of the time Potter spent offshore should be counted toward the 30% threshold of performing work in service of a vessel. Thus, the time spent by Potter working on the water, whether on a transportation vessel, the feed barge, or the cages (a mile out to sea) satisfied the connection test for seaman status because “she was exposed to the perils of the sea.” In rejecting that argument, Justice Connors considered the analogy of workers in offshore oil drilling operations. She reasoned that the courts did not consider the time spent on non-vessels, such as work platforms affixed to the sea bed, to be part of the mission of the vessel transporting the worker. She added that “although a worker on a non-vessel platform in the water is exposed to the elements of the sea, she is not engaged in a traditional sea-centric occupation. The fact that less than 30% of her time was associated with vessel-centric activities was dispositive of the claim that she was a Jones Act seaman.
It was not a surprise that treating physician Zoran Cupic would testify at trial that an injured worker may need surgery, and it was therefore error to allow a previously undesignated doctor to rebut the opinion given by Dr. Cupic at trial; the ruling prohibiting the workers from eliciting testimony from the defendant’s corporate representative provided no ground for reversal when the plaintiffs did not appeal from the failure to award punitive damages on the maintenance and cure claim; Christian v. Oceanwide America, Inc., No. 01-19-00557-CV, 2020 Tex. App. LEXIS 10451 (Tex. App. Houston [1st Dist] Dec. 31, 2020) (Landau).
Jether Christian and Derek George were hired as contract riggers to work on the refurbishment of the derrick barge M/V AMERICAN EUROPE MARINE 16 and were injured during the sea trial of the derrick barge when it began rocking in the waves and they were struck by a 75-pound shackle. They brought this suit against the owner of the vessel and the contractor, and George’s action was continued by his mother after he died of a drug overdose. The case was tried for two weeks, and the jury awarded $56,500 to Christian and nothing to George’s estate. Christian and George both designated their treating orthopedic surgeon, Zoran Cupic, and their life care planner, Sasha Iversen as experts. The defendants designated Dr. David Vanderweide as their expert to testify as to Christian’s treatment, impairment, and pain, and Dr. Edward C. Murphy to testify about George’s medical condition, prognosis, and treatment. Before trial, Dr. Cupic’s reports opined that Christian was not a candidate for surgery, but at trial he testified that Christian may need surgery in the future (two, three-level instrumented fusions). The defendants chose to present the opinion of Dr. Vanderweide (that Christian did not need surgery) by deposition. However, in light of Dr. Cupic’s trial testimony, the defendants sought to rebut the testimony of Dr. Cupic with respect to surgery with the live testimony of Dr. Murphy (who testified at trial with respect to George). The district court allowed Dr. Murphy to testify as a rebuttal witness to counter the testimony of Dr. Cupic when the defendants asserted that Dr. Vanderweide was not available. Christian challenged that ruling on appeal, and the court of appeals reversed and ordered a new trial. First, Justice Landau did not consider Dr. Cupic’s testimony to be a surprise. His prior reports indicated that he did not need surgery at the time of those opinions. The appellate court did not consider his trial testimony that he may need surgery in the future to be inconsistent. Additionally, Christian’s life care planner is a physician who had assessed future costs based on Christian requiring future surgeries. Dr. Vanderweide was designated to testify on the very topic for which the defendants wanted rebuttal testimony. The defendants chose to present his testimony by deposition, and they established that he was not available after Dr. Cupic’s testimony but they did not establish that he was not available for the remaining four days of trial. Thus, Justice Landau concluded that the defendants had failed to demonstrate good cause to allow an undesignated expert to testify. She also found that Christian was prejudiced as Murphy’s testimony addressed not only Christian’s future medical treatment but the credibility and professional competence of Dr. Cupic. His testimony was beyond what Dr. Vanderweide had given and required a new trial. The plaintiffs also raised a second evidentiary issue for the court of appeals. During the presentation of the plaintiffs’ case, the plaintiffs’ counsel relied on the representation of defense counsel that he was going to call the corporate representative for the contractor to testify during the defense case. His testimony for the plaintiffs would have been used to establish the wrongful failure to pay maintenance and cure for the claim of punitive damages. When the defendant did not present the testimony of the corporate representative, who was present in the courtroom, the plaintiffs sought to call him after they had rested their case. The district court declined to allow the plaintiffs to call the corporate representative, and the jury found that the defendant was liable for punitive damages but did not award any punitive damages. On appeal, the plaintiffs argued that they should be allowed to rely on the representation of defense counsel, and the defendant responded that a strategic decision was made not to call the witness after the plaintiffs “fumbled” the matter by relying on the belief that the defendant was going to call the witness during its case. The defendant argued that it was “free to pursue a strategy deemed appropriate . . . when faced with an opposing antagonistic position” from the plaintiffs’ attorneys who were not at their “first rodeo.” As the plaintiffs did not appeal the absence of punitive damages, Justice Landau held that the district court’s ruling provided no basis for reversal and overruled the issue.
Thanks to Katherine E. Kaplan and Fitzgerald Eze for their help in preparing this Update.
Kenneth G. Engerrand
President, Brown Sims, P.C.
1177 West Loop South
Houston, TX 77027
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Lafayette, LA 70501
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The precise moment a ship is withdrawn from navigation can be a difficult, fact-intensive inquiry. We are fortunate that we need not decide precisely how many rotted planks must be removed before Theseus’s ship ceases to be Theseus’s ship. When her bow has been severed, leaving a gaping hole open to the sea, her cargo tanks have been rendered inoperable, and the party asserting jurisdiction is unable to allege any types of people or things that she is capable of carrying over navigable water, we can readily conclude that DBL 134 is no longer a vessel.
In re: Southern Recycling, L.L.C., No., 20-40274 (5th Cir. Dec. 7, 2020) (Clement).
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