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November 2020 Longshore/Maritime Update

November 2
2020

November 2020 Longshore/Maritime Update (No. 258)

Notes from your Updater:

On October 2, 2020, the Supreme Court granted a writ of certiorari in BP P.L.C. v. Mayor and City Council Baltimore (No. 19-1189) (with Justice Alito not participating). The suit was brought by the Mayor and City of Baltimore against 26 multinational oil and gas companies, asserting that they were partially responsible for climate change. The oil and gas companies removed the case on numerous grounds, including the federal jurisdiction of the Outer Continental Shelf Lands Act, and the district judge rejected all the bases for removal and remanded the case. The only ground the defendants had to appeal the remand of the case was the Federal Officer Removal Statute, but the Fourth Circuit rejected that as a basis for removal, affirming the remand of the case to state court. The energy companies sought a petition for certiorari. The question presented is: Whether 28 U.S.C. 1447(d) permits a court of appeals to review any issue encompassed in a district court’s order remanding a removed case to state court where the removing defendant premised removal in part on the federal-officer removal statute, 28 U.S.C. 1442, or the civil rights removal statute, 28 U.S.C. 1443.

On October 7, 2020, a jury in the Western District of Washington at Seattle returned a verdict of $1,689,000 in favor of Margaret Dallo against Holland America Line in the first federal Zoom civil jury trial. Dallo’s suit asserted a brain injury in a fall when she was struck by an opening door while walking down a hallway on the EURODAM. The jury also found that Dallo’s injury was caused 20% by her comparative negligence. The case is No. 2:19-cv-865, and Judge Thomas Zilly presided over the trial.

In our February 2020 Update we discussed the litigation arising from the zoning ordinance enacted by the City of South Portland, Maine, that prohibited bulk loading of crude oil onto vessels in that city’s harbor. Rather than deciding whether the ordinance was preempted by federal law, the First Circuit certified issues to the Maine Supreme Court to address whether the local ordinance was preempted [displaced] by state law. On October 29, 2020, the Maine Supreme Court ruled that state law did not preempt [displace] the ordinance, sending the case back to the First Circuit to determine whether the ordinance is preempted by federal law. Portland Pipe Line Corp. v. City of South Portland, 2020 Me. 125 (Me. Oct. 29, 2020) (Mead).

On the LHWCA Front . . .

From the federal appellate courts:

DBA/LHWCA employer/carrier held not to be responsible for incidental financial consequences caused by delayed compensation; Aegis Defense Services, LLC/Allied World Assurance Co. v. Martin, Nos. 19-70566, 19-70588, 2020 U.S. App. LEXIS 31812 (9th Cir. Oct. 7, 2020) (per curiam).

Opinion

These appeals resulted from the decision of an administrative law judge that Mathew Martin suffered a permanent disability only after he began working in Afghanistan under the coverage of Aegis Defense Services/Allied World Assurance. The Benefits Review Board rejected the argument by Aegis/Allied that Martin was only working in Afghanistan through extraordinary effort and affirmed the award. Finding substantial evidence to support the award, the Ninth Circuit affirmed the award and then turned to Martin’s appeal of the denial of reimbursement for the costs of refinancing his home. Martin argued that he had to refinance his home to support his family when Allied would not pay benefits to Martin under the LHWCA/DBA. He sought both the costs of interest he paid and the refinancing costs (title service, credit reports, recording charges, inspections, and closing costs), equating them to the cost of an award of pre-judgment interest. The Ninth Circuit held that Martin was entitled to interest on benefits that had not been paid, but it disagreed that the borrowing costs were the equivalent. The court held that his request was beyond preserving the value of benefits as set forth in the LHWCA. In essence, Martin was asking the court to hold employers and carriers responsible for the incidental financial consequences of delayed compensation. As there was nothing in the LHWCA evincing Congressional intent to provide such a remedy, the Ninth Circuit declined Martin’s request.

Dismissal of longshore worker’s claims that the ILA Local breached its duty of fair representation (because the claims were insufficiently pleaded or were time barred) was affirmed by the Eleventh Circuit; Steward v. International Longshoreman’s Association, Local No. 1408, No. 19-14636 (11th Cir. Oct. 7, 2020) (per curiam).

Opinion

Albert Steward brought this suit against ILA Local 1408 for breach of its duty of fair representation to its member, based on problems with his seniority, his suspension by Coastal Great Southern, and the Local’s failure to include him within an amnesty program. The district court dismissed most of the claims based on the failure to assert the claims within the six-month limitation period established in the National Labor Relations Act. Although Steward argued that he claims should not be dismissed because they were part of a continuing violation, the Eleventh Circuit held that all but one of the claims were subject to final action more than six months before the suit and were consequently barred. The Eleventh Circuit agreed with the dismissal of the final claim as the complaint did not plausibly allege that he was treated differently than other union members.

Ninth Circuit overturned the NLRB in an intra-union dispute over which union would perform maintenance and repair work at Kinder Morgan’s bulk terminal facility in Vancouver, Washington; International Longshore and Warehouse Union v. National Labor Relations Board, No. 19-70297 (9th Cir. Oct. 14, 2020) (Hawkins).

Opinion

Kinder Morgan previously contracted electrical maintenance and repair work at its bulk terminal facility in Vancouver, Washington, to a company that employed electricians represented by the International Brotherhood of Electrical Workers (IBEW). Thereafter, the Pacific Maritime Association (of which Kinder Morgan is a member) negotiated a collective bargaining agreement that granted to the International Longshore and Warehouse Union (ILWU) maintenance and repair work for all stevedore cargo-handling equipment. Kinder Morgan continued to use the IBEW electrical workers after the collective bargaining agreement with the Pacific Maritime Association awarded the work to the ILWU, and members of the ILWU filed grievances. The National Labor Relations Board ruled in favor of the IBEW, but the Ninth Circuit disagreed, holding that the language of the collective bargaining agreement with the ILWU unambiguously granted to the ILWU all maintenance and repair work on stevedore cargo-handling equipment.

Mechanic who maintained and repaired vessels involved in the construction of a bridge was not a seaman and was not entitled to recover against his employer in its capacity as vessel owner under Section 905(b) of the LHWCA; Doty v. Tappan Zee Constructors, LLC, No. 20-36-cv, 2020 U.S. App. LEXIS 33541 (2d Cir. Oct. 22, 2020) (per curiam).

Opinion

The New York State Thruway Authority hired Tappan Zee Constructors to design and construct the Governor Mario M. Cuomo Bridge, and Tappan Zee hired Brian Doty to work as a mechanic. Doty maintained and repaired barges, tug boats, work boats, crane barges, and the equipment appurtenant to them. Aside from taking a boat between moored barges, Doty did not work on vessels while they were traveling over water. Doty was injured while repairing a crane attached to the crane barge THE STRONG ISLAND and brought suit against Tappan Zee as a seaman and, alternatively, against Tappan Zee in its capacity as owner of the crane barge pursuant to Section 905(b) of the LHWCA. The district court held that Doty was not a seaman, and the Second Circuit agreed, noting that Doty worked exclusively on stationary vessels (even though they were secured in the middle of open water and not at a dock) and not on vessels navigating over water. The Second Circuit also agreed that Doty was not entitled to recover against Tappan Zee in its capacity as owner of the crane barge. The crane was being used to build the bridge, and the dangerous condition of the bridge was related to his employer’s work as a construction company, not as a vessel owner.

District court reached the correct conclusion that a mechanic on an offshore platform was a borrowed employee of the platform owner and that the LHWCA was his exclusive remedy, but the court improperly applied the Ruiz factors to reach that conclusion; borrowing employer need only have LHWCA coverage to invoke the exclusive remedy provision in the Act and it was not necessary that its carrier be the one making the LHWCA payments to the claimant; Raicevic v. Fieldwood Energy, L.L.C., No. 19-40580 (5th Cir. Oct. 28, 2020) (per curiam).

Opinion

Milorad Raicevic was employed by Waukesha Pearce Industries as a mechanic on Fieldwood Energy’s offshore platform. He was injured when he slipped and fell twice due to oil that had leaked on the floor while he was trying to correct the mechanical issue that triggered an alarm. Raicevic brought this suit against Fieldwood Energy, and the case was tried to a jury that returned a verdict that Fieldwood Energy and Raicevic were both 50% negligent. As Fieldwood Energy had raised a defense that Raicevic was a borrowed servant of Fieldwood Energy and that LHWCA compensation was his exclusive remedy, Judge Hanks submitted the nine Ruiz factors on borrowed servant status to the jury to make factual findings on each factor. Judge Hanks then weighed the findings on the Ruiz factors and concluded that Raicevic was a borrowed employee and that Fieldwood Energy was immune to suit based on the exclusive remedy provision in the LHWCA. The Fifth Circuit agreed that Raicevic was a borrowed servant based on the Ruiz factors, but the court began its analysis by noting that Judge Hanks did not properly weigh the factors. Judge Hanks was correct that four of the factors are the most important ones when the court is determining whether the borrowed servant defense operates as a bar to common-law liability (did the employee acquiesce in the new work situation, did the original employer terminate his relationship with the employee, who furnished the tools and place for the performance, and was the new employment over a considerable length of time?). However, Judge Hanks only analyzed those four factors and treated the other factors as disposable. The Fifth Circuit emphasized that “no factor can be categorically excluded from the analysis.” The court of appeals analyzed all of the Ruiz factors and noted that only one factor (did the original employer terminate his relationship with the employee?) plainly favored Raicevic’s argument that he was not a borrowed servant. Consequently, the court held that Fieldwood Energy could invoke the LHWCA as a bar, unless there was an exception in the LHWCA to the applicability of the bar. Raicevic asserted that Fieldwood Energy could not claim immunity if it failed to secure payment of compensation as required by Section 905(a) of the LHWCA, and that LHWCA compensation had been paid by Waukesha Pearce’s insurer and not by Fieldwood Energy’s insurer. This raised the question whether an employer must prove not only that it had LHWCA insurance but that it paid LHWCA benefits. The Fifth Circuit answered that it was enough to obtain immunity that Fieldwood Energy had obtained LHWCA insurance that was in place at the time of the injury. As Fieldwood Energy did have LHWCA insurance, it was entitled to immunity from the suit.

From the federal district courts:

Court dismissed longshore worker’s harassment and discrimination claims against the ILA local that employed the worker who allegedly harassed her but declined to dismiss the claims against the ILA local that employed her; Wiggins v. SSA Atlantic, LLC, No. 2:19-2291, 2020 U.S. Dist. LEXIS 181044 (D.S.C. Sept. 30, 2020) (Gergel).

Opinion

Antonette Wiggins, a member of International Longhoremen’s Association Local 1422, asserted that she was the victim of harassment and sex discrimination while she was working for SSA Cooper at the Wando Terminal in Mount Pleasant, South Carolina, based on the actions of Cliff Inabinett, a member of ILA Local 1771. She brought discrimination and harassment claims against SSA Cooper, ILA Local 1422, and ILA Local 1771, and the Locals filed motions to dismiss. Agreeing with the recommendations of the magistrate judge, Judge Gergel held that, as Wiggins did not allege any membership in Local 1771 or any allegation that Inabinett was an agent of the Local or that the Local supported his actions, the complaint should be dismissed as to Local 1771. However, as Wiggins plausibly alleged that Local 1422 was her joint employer, Judge Gergel declined to dismiss Wiggins’ claims against Local 1422. 

Affidavit of iron worker injured on a barge while working on the replacement of a bridge, stating that approximately a third of his time was spent working on the water on his employer’s vessels, was insufficient to create a fact question on the duration element of the seaman status test; worker was covered by the LHWCA, which provided his exclusive remedy; Gates v. American Bridge Co., No. H-20-418, 2020 U.S. Dist. LEXIS 181909 (S.D. Tex. Oct. 1, 2020) (Rosenthal).

Opinion

The seaman status claim of William Gates, who was injured while working as an iron worker by American Bridge Co., returns to the Update (see June 2020 Update). He slipped and fell on a barge owned by American Bridge while constructing a replacement bridge over the San Bernard River in Brazoria County, Texas, and brought suit in state court under the Jones Act and general maritime law. American Bridge removed the case to federal court, asserting that the Jones Act case was improperly pleaded and did not prevent removal. The iron workers performed fabrication and welding work on land and on the bridge, and they also worked on floating equipment. Gates was injured while helping to tie off a small barge. In a previous opinion, Chief Judge Rosenthal held that Gates had not established a substantial connection to a vessel in navigation as a seaman and denied Gates’ motion to remand the case to state court. She ordered American Bridge to file a motion for summary judgment, and then granted the motion in this decision. American Bridge submitted affidavits that Gates spent well below 30% of his work time aboard vessels, but Gates attempted to create a fact question whether he satisfied the 30% rule-of-thumb for the duration element of the seaman status test by his affidavit stating that approximately a third of his time was spent working on the water on American Bridge’s vessels. Chief Judge Rosenthal did not find that Gates created a fact question and held that Gates’s unsupported and conclusory affidavit did not carry his burden of proof as to the amount of time he spent on vessels or to establish that he had been reassigned to a new position before his injury (compare Delozier v. S2 Energy Operating, LLC, discussed below). As he was not a seaman, Chief Judge Rosenthal addressed whether Gates’s injury was covered under the LHWCA. Gates satisfied the situs test from his injury on a vessel on the water. He also satisfied the status test as his work frequently involved loading and unloading of vessels. In fact, he was injured while removing concrete slabs on a barge. Consequently, Gates’s injury was covered by the LHWCA, Chief Judge Rosenthal held that his claims under admiralty law were barred by the exclusive remedy provision of the LHWCA.

Subcontractor working on a government contract on a Navy ship was denied removal of a Section 905(b) action under the Federal Officer Removal Statute and admiralty jurisdiction; Administrator ad Prosequendum for the Estate of Williams Saravia v. Bayonne Dry Dock & Repair Corp., No. 2:20-cv-9174 (D.N.J. Oct. 5, 2020) (McNulty).

Opinion

Williams Saravia died as the result of an accident on the Navy ship RED CLOUD at the Bayonne ship repair yard where the vessel was undergoing repair. The Navy contracted with Patriot Contract Services, which contracted with Bayonne, which contracted with 5 Season LSB to perform painting services on the vessel, which employed Saravia. Saravia’s Estate brought a Section 905(b) action against Patriot and Bayonne, and Bayonne removed the case to federal court based on the Federal Officer Removal Statute and the court’s admiralty jurisdiction. Judge McNulty concluded that all of the requirements for removal under the Federal Officer Removal Statute were satisfied except for the requirement of a colorable federal defense. Bayonne did not contract with the United States, did not interact with the government, and did not establish that the work specifications came directly from the government. Therefore, removal was not available under the Federal Officer Removal Statute. Turning to the court’s admiralty jurisdiction, Judge McNulty cited a New Jersey case holding that admiralty claims do not arise under the federal constitution or laws and that there must be some independent basis for jurisdiction. Jumping to the conclusion that the saving-to-suitors clause saved the suit from removal on the basis of admiralty jurisdiction, Judge McNulty remanded the case to state court.

Shipyard worker’s state negligence claims against his employer were preempted by the LHWCA; Hulin v. Huntington Ingalls, Inc., No. 20-924, 2020 U.S. Dist. LEXIS 189824 (E.D. La. Oct. 14, 2020) (Vance).

Opinion

Avondale employed William Hulin at its shipyard from 1954 to 1973 as a shipfitter, laborer, and tacker. He was diagnosed with lung cancer in 2019 and asserted that it was the result of exposure to asbestos during his employment prior to 1972, before the extension of the LHWCA to shoreside facilities and while the LHWCA and Louisiana workers’ compensation statute afforded concurrent jurisdiction. Hulin brought this suit against the shipyard and its insurers under Louisiana law, and the defendants moved for summary judgment on the ground that the LHWCA preempted Hulin’s state claims. Judge Vance initially had to determine which version of the LHWCA applied to Hulin’s claims, the version in effect at the time of the exposure or the version in effect at the time of the manifestation of his disease. Concluding that the manifestation rule controlled that decision, Judge Vance applied the LHWCA as it existed in 2019 and held that Hulin satisfied the situs and status requirements of the Act. As the shipyard was entitled to immunity from tort liability under the current version of the LHWCA, Judge Vance held that Hulin’s state claims were preempted. Finally, Judge Vance held that the application of the current version of the LHWCA to exposures that occurred prior to the 1972 Amendments did not violate the due process clause of the Constitution. Congress merely substituted the no-fault remedy of the LHWCA for the uncertain liability of common-law torts.

From the state courts:

Findings of the ALJ in a worker’s LHWCA claim that the worker’s labrum tear and PTSD were not causally related to his accident were not given collateral estoppel effect in his tort suit in state court against the owner of the vessel on which he was injured; Bourgeois v. Select Oilfield Services, LLC,  No. 2020-CA-170 c/w No. 2020-CA-171, 2020 La. App. LEXIS 1472 (La. App. 4 Cir. Oct. 7, 2020) (Chase).

Opinion

Tramond Bourgeois was injured while working on an offshore project for Fab-Con when the boat on which he was a passenger, owned and operated by Select Oilfield, capsized. Bourgeois brought an LHWCA claim against Fab-Con and this lawsuit in the state court in Plaquemines Parish, Louisiana, against Select Oilfield, including claims as a seaman. Bourgeois’ LHWCA claim was tried to an ALJ, who issued an order on February 6, 2018, which awarded compensation and medical benefits to Bourgeois but found that his claims of a right shoulder labrum tear and post-traumatic stress disorder were not caused by the accident. The Benefits Review Board affirmed that decision on November 5, 2018, and the Fifth Circuit denied the petition for review on January 2, 2020. After the decision of the ALJ, Select Oilfield filed a motion for partial summary judgment in the lawsuit on June 1, 2018, asserting that the claims with respect to the labrum tear and PTSD had been adjudicated by the ALJ and were subject to collateral estoppel. The judge denied Select Oilfield’s motion and held a bench trial in August 2018, rendering judgment on September 27, 2019, that Bourgeois’s labrum tear, PTSD, and other injuries were causally related to his accident and awarding a total of $1,122,672.08 in damages. The Louisiana Court of Appeal affirmed the decision, rejecting the collateral estoppel argument for two reasons. First, the decision of the ALJ was not final until after the trial when the Fifth Circuit denied Bourgeois’ petition for review on January 2, 2020. Therefore, Judge Chase held that collateral estoppel was not applicable at the time of the decision of the trial court. Second, Judge Chase held that, as Bourgeois sought negligence damages in the state court and workers’ compensation benefits in the LHWCA proceeding, the factual determinations by the ALJ were different and were not subject to collateral estoppel. After rejecting the collateral estoppel defense, Judge Chase held that there was sufficient evidence to support the findings on medical causation and future wage loss and affirmed the judgment.

And on the maritime front . . .

From the federal appellate courts:

Carrier’s termination of shipping service relieved the cargo shippers of the remaining quantity commitments in their annual contracts; In re Containership Co. (TCC) A/S, No. 19-3394, 2020 U.S. App. LEXIS 32032 (2d Cir. Oct. 8, 2020) (per curiam).

Opinion

The Containership Company launched a trans-Pacific container-shipping service in 2010 and entered into annual contracts with several cargo shippers that included a minimum requirement for the cargo to be shipped. Before the end of the contract year, however, The Containership Company discontinued its service, cancelled its remaining sailings, and initiated bankruptcy proceedings. In the bankruptcy proceeding, The Containership Company argued that the discontinuance of its service did not relieve the cargo shippers of the remaining amounts on the shipping commitments, but the bankruptcy judge, district judge, and Second Circuit disagreed and held that the cargo shippers were excused from complying with the contract minimums. Additionally, the courts rejected the contention that the cargo shippers had breached the contracts by not shipping cargo evenly “as far as possible” throughout the contract term as there were no clear guidelines to determine how to measure those efforts.

Fifth Circuit affirmed dismissal of BELO suit for lack of expert evidence to establish causation; McGill v. BP Exploration & Production, Inc., No. 19-60849 (5th Cir. Oct. 12, 2020) (per curiam).

McGill Opinion

Our longsuffering readers have seen many summaries of Back-End Litigation Option lawsuits involving clean-up workers who claimed later-manifested conditions from their work on the DEEPWATER HORIZON/Macondo spill. This case involves the dismissal of the claim of Blaine McGill (December 2019 Update) after Judge Guirola excluded the testimony of McGill’s expert pulmonologist, Dr. Steve Stogner, because he did not know the extent of McGill’s exposure, whether his exposure was through inhalation or skin contact, or whether the dispersant could be inhaled after it had been applied to the water. The Fifth Circuit agreed that Dr. Stogner’s opinion was not based on sufficient facts, nor was it the product of reliable methodology. Although Dr. Stogner had relied on studies that were consistent with the notion that the dispersant (Corexit) or crude oil could cause respiratory harm, the studies did not support the conclusion that these substances cause the illnesses from which McGill suffers or what level of exposure is hazardous to humans. Without expert support, McGill argued that the district court should not have applied the toxic tort standard to grant summary judgment in this case arising under general maritime law. However, the Fifth Circuit affirmed the summary judgment because McGill did not offer evidence of causation under any plausible causation standard.  Two other district courts dismissed BELO suits for lack of causation. One case involved a clean-up worker like McGill. See Ordonez v. BP Exploration & Production, Inc., N0. 18-9166, 2020 U.S. Dist. LEXIS 181980 (E.D. La. Oct. 1, 2020) (Brown). The other case involved a Zone A Resident who claimed that she suffered medical problems from exposure to oil, dispersants, and other harmful chemicals. See Woodson v. BP Exploration & Production, Inc., No. 1:19-cv-463, 2020 U.S. Dist. LEXIS 199481 (S.D. Miss. Oct. 27, 2020) (Ozerden).

Ordonez opinion

Woodson opinion

Two-year statute of limitations under the Suits in Admiralty Act began to run from the date of injury for a maintenance and cure claim, and negligent assignment and other continuing tort theories did not toll limitations for a discrete, traumatic injury; Ruan v. United States, No. 19-55602, 2020 U.S. App. LEXIS 32549 (9th Cir. Oct. 15, 2020) (per curiam).

Opinion

Michael Ruan injured his finger on April 26, 2016, while working as a member of the crew of the Navy ship RED CLOUD. He brought this action against the United States on April 27, 2018, seeking to recover for negligence under the Jones Act and for unseaworthiness and maintenance and cure under the general maritime law. As the suit was outside of the two-year statute of limitations in the Suits in Admiralty Act, the United States sought dismissal of the complaint. Ruan alleged in response that the maintenance and cure claim was ongoing and that he was also entitled to bring a claim for negligent assignment—that Ruan’s disability arose from his assignment to unsuitable work after his accident and that work aggravated his injury. The district court and the Ninth Circuit rejected Ruan’s arguments. The Ninth Circuit held that even though Ruan asserted that the United States failed to care for Ruan after his injury, the cause of action for maintenance and cure under the Suits in Admiralty Act runs from the date of the injury. The court also rejected negligent assignment and other continuing tort theories as a basis to toll the running of the statute of limitations as Ruan suffered a discrete, traumatic injury, even if it was made worse by subsequent actions of his employer.

From the federal district courts:

Venue in the Public Vessels Act and convenience of the parties and witnesses did not support transfer of the limitation action brought by the United States; In re United States, No. 4:18-cv-65, 2020 U.S. Dist. LEXIS 179376 (D. Utah Sept. 28, 2020) (Nuffer).

Opinion

The United States brought this action in federal court in Utah seeking to limit its liability for National Park Service vessels used to patrol, inspect, and mark the navigable waters of Lake Powell where a speedboat grounded, causing injuries to its passengers. The claimants in the limitation action sought to transfer the suit to the District of Arizona, and the United States opposed the motion on the ground that the sole venue for the action, pursuant to the Public Vessels Act, was the Utah federal court, and that the claim did not satisfy the requirements under Supplemental Rule F (9) for a transfer—convenience of the parties and witnesses and in the interest of justice. Judge Nuffer agreed with the United States that, as the Public Vessels Act contains no provision for transfer of venue, it would be inconsistent with the language of the statute (providing for venue in the district where the vessel or cargo is found) to transfer venue. Additionally, Judge Nuffer weighed the convenience of the witnesses and parties and the interests of justice (including the Arizona residence of the two minor children who were injured along with their doctors and other witnesses), and held that the transfer was not justified.

Passengers on cruise ship who were injured from severe weather were allowed to pursue punitive damages against the cruise line; Irvin v. NCL (Bahamas) Ltd., No. 20-20929, 2020 U.S. Dist. LEXIS 188342 (S.D. Fla. Sept. 28, 2020) (Cooke).

Opinion

Passengers on the NORWEGIAN ESCAPE were injured when the vessel tilted three times during a severe winter storm on a cruise from New York to Florida. After denying that the passengers’ pleading was a shotgun pleading, Judge Cooke addressed the cruise line’s motion to dismiss the passengers’ claim for punitive damages. Citing the rule in the Eleventh Circuit, Judge Cooke held that the passengers must prove intentional conduct to support their punitive damage claim. In this case, Judge Cooke held that the passengers’ allegations that the cruise line had experienced a similar winter storm the previous year, was aware of the severe conditions prior to departure, continued to monitor the forecast, and sailed through the storm were sufficient to allow an inference of intentional conduct that would allow an award of punitive damages. For a different result, see Roberts v. Carnival Corp., which is discussed below.

Jones Act violation did not establish racketeering to support RICO action against yacht builder, and misrepresentation about the Jones Act could not be the basis for a fraud claim; Little v. Dufour Yachts SAS, No. 19-cv-5411, 2020 U.S. Dist. LEXIS 177580 (N.D. Ill. Sept. 28, 2020) (Alonso).

Opinion

Matthew and Sherry Little entered into two agreements with yacht dealer Broad Reach Sailing to purchase a yacht and then to let the dealer use the yacht in a yacht pool. The yacht was built by French company Dufour Yachts, which marketed and operated fractional ownership programs throughout the United States. The Littles asserted that the program fell apart, however, because the use of the yachts was considered commercial, and the involvement of the foreign-built yacht violated the Jones Act. The Littles brought suits in state and federal court alleging fraud and RICO violations against the yacht builders and importers. Judge Alonso declined to dismiss the action based on abstention, res judicata, or claim splitting in connection with the state suit. However, he did dismiss the fraud allegation (about the legality of the program) because everyone is presumed to know the law and misrepresentations of the law cannot form the basis for a claim of fraud. He also dismissed the RICO claims on the ground that a violation of the Jones Act does not constitute racketeering for purposes of RICO.

Arrest and sale of vessel in Malta extinguished lien for bunkers on vessel; World Fuel Services, Inc. v. M/V PARKGRACHT, No. 19-cv-62672, 2020 U.S. Dist. LEXIS 179583 (S.D. Fla. Sept. 28, 2020) (Ungaro).

Opinion

Four subsidiaries of World Fuel Services supplied bunkers to Hansa Heavy Lift (HHL), previous owner of the PARKGRACHT and other vessels. World Fuel Services learned that HHL was entering insolvency proceedings, and began arresting HHL vessels to recover the $15 million owed by HHL to World Fuel Services. World Fuel Services learned that the PARKGRACHT was sailing to Malta and consulted a Maltese attorney who advised them that there was a mortgage claim on the vessel in excess of 30 million Euro. World Fuel Services declined to arrest the vessel in Malta, and its lawyer notified it that the vessel had been arrested by the mortgagee. The sale of the vessel to B.V. Firmanten Parkgracht for 9.3 million Euro was approved by the court in Malta, awarding free and clear title to the vessel under Maltese law. World Fuel thereafter arrested the vessel in federal court in Florida, and the new owner argued that it had acquired title free and clear of the lien for bunkers by the Maltese sale and additionally that laches barred the assertion of the lien. Judge Ungaro agreed that the sale divested World Fuel Services of its lien, rejecting the claim that notice was not properly given of the sale as World Fuel Services had actual notice of the proceeding but elected not to file a claim.

Mortgagee was entitled to recover attorney’s fees based on provision in first preferred ship mortgage that was incorporated into the installment note; Suntrust Banks, Inc. v. Be Yachts, LLC, No. C18-840, 2020 U.S. Dist. LEXIS 178082 (W.D. Wash. Sept. 28, 2020) (Pechman).

Opinion

After SunTrust Banks was finally able to obtain the proceeds from the arrest and sale of the yacht JUST BE to satisfy its first preferred ship mortgage (see June and August 2020 Updates), the bank sought an award of attorney’s fees. The installment note, which provided that it superseded all prior or contemporaneous oral or written understandings, was silent about the mortgagee’s entitlement to attorney’s fees. However, the note incorporated the first preferred ship mortgage by reference, and that document provided for the award of attorney’s fees. Consequently, Judge Pechman held that SunTrust Banks was entitled to an award of attorney’s fees related to its prevailing claim.

Passenger’s evidence with respect to fall on stairs was sufficient to survive the cruise line’s motion for summary judgment on whether the condition was open and obvious, whether the cruise line had notice of the condition, and whether the cruise line was liable for negligent design; Hoover v. NCL (Bahamas) Ltd., No. 19-22906, 2020 U.S. Dist. LEXIS 180114 (S.D. Fla. Sept. 29, 2020) (Cooke).

Opinion

Barbara Hoover returned to the NCL BLISS after a shore excursion during which it had rained, and later that day she went up a stairway on the vessel to observe the weather, noting that the stairs were wet. On her way down the stairs, she slipped and fell. The cruise line filed a motion for summary judgment, which was denied by Judge Cooke. Although it was open and obvious that the stairs were wet, Hoover’s expert opined that the different levels of traction on the stairs may have made the stairway unreasonably unsafe, so that the extent of danger may not have been appreciated by the passenger. Hoover was also able to survive summary judgment with respect to the cruise line’s notice as there had been at least four incidents with passengers on the stairs before Hoover’s fall, and notes from a safety meeting on the ship reflected concerns about the slipperiness of the staircase. Finally, as the cruise line’s representative did not provide a direct answer to the question of whether the cruise line approved the design for the stairs, Judge Cooke held that summary judgment was not appropriate on Hoover’s claim of negligent design.

Federal court lacked jurisdiction over Navy contractor’s suit against the United States for declaratory relief on the contractor’s liability for wages under state law; Systems Application & Technologies, Inc. v. United States, No. 8:18-cv-2607, 2020 U.S. Dist. LEXIS 182253 (D. Md. Sept. 30, 2020) (Xinis).

Opinion

Systems Application provided support for the Navy’s military training exercises and weapons testing, with significant portions of the work performed on Navy vessels. Systems Application argued that it did not owe wages to its workers during their off-duty time on the vessel (pursuant to the Fair Labor Standards Act), but California argued that Systems Application owed wages to its employees for the entire time they were aboard the vessels, including the time they were off-duty (pursuant to California law). As Systems Application’s contract with the United States was on a cost-reimbursement basis, Systems Application made requests to the United States to assist in the litigation against Systems Application or to advise if the United States would reimburse for the wages paid based on California law. When the United States declined to respond, Systems Application brought this suit under the Public Vessels Act, the Suits in Admiralty Act, and the Contract Disputes Act, seeking declaratory relief. As Systems Application’s requests of the United States did not constitute valid claims under those statutes, Judge Xinis dismissed the suit for lack of subject matter jurisdiction.

Platform worker who performed some work from vessels was held to present a fact question of seaman status; worker’s nominal employer did not establish that it divested itself of all control of the worker so as to obtain summary judgment on his Jones Act negligence claim, but was entitled to dismissal of the unseaworthiness claim as it was not the owner or demise charterer of the vessel; other defendants failed to establish as a matter of law that the worker was not their borrowed employee; Delozier v. S2 Energy Operating, LLC, No. 18-14094, 2020 U.S. Dist. LEXIS 182239 (E.D. La. Sept. 30, 2020), 2020 U.S. Dist. LEXIS 180306 (E.D. La. Sept. 30, 2020), 2020 U.S. Dist. LEXIS 183964 (Oct. 5, 2020) (Morgan).

Seaman status opinion

Nominal employer opinion

Borrowed servant opinion

Correy Delozier was nominally employed by Pioneer as an operator. Pioneer contracted with S2 Energy to provide Delozier to work on S2’s platforms in the Timbalier Bay Oil Field in Louisiana waters. Delozier was injured when he was crushed between an oil well and a crew boat during an attempted transfer from a crew boat to an S2 Energy platform. He and his wife brought suit against S2, Pioneer, and the Wood Group, asserting claims under the Jones Act and general maritime law. Wood Group and S2 filed motions for summary judgment that Delozier was a platform worker who did not have a sufficient connection to the crew boats in duration and nature in order to be a seaman. As there was disputed evidence as to the amount of time that Delozier spent on the crew boats and whether he performed duties on the crew boats, Judge Morgan declined to hold that Delozier was not a seaman as a matter of law. Judge Morgan also denied Pioneer’s motion for summary judgment that it was not liable as an employer under the Jones Act, ruling that a worker can have more than one Jones Act employer, that Pioneer had not established as a matter of law that it had divested itself of all control over Delozier, and there was a fact question with respect to the training provided to him regarding personnel transfers. However, Judge Morgan did dismiss the claims against Pioneer of unseaworthiness of the crew boat as Pioneer was neither the owner nor the demise charterer of the crew boat. Finally, Judge Morgan reviewed the Ruiz v. Shell Oil factors and held that there were fact questions whether S2 and Wood Group had control over the work of Delozier so as to be his borrowing employer for the Jones Act claims.

Vessel owner’s counterclaims against wharfinger for negligence and breach of the implied warranty of workmanlike performance were barred by the economic loss rule and for failure to plead facts to support the claims; Republic Contracting Corp. v. Kissimmee Auction Co., No. 2:19-cv-3330, 2020 U.S. Dist. LEXIS 181045 (D.S.C. Sept. 30, 2020) (Hendricks).

Opinion

The SUN CRUZ VII, owned by Kissimmee, was docked at Republic’s premises for more than two years, but Kissimmee only made payments on the lease agreement for the dock for a few months. Republic then brought this action seeking to recover nearly $200,000 in unpaid rent, and Kissimmee counterclaimed for damage to the vessel based on Republic’s alleged failure to provide security or to protect the vessel from criminal acts of third parties. Republic moved to dismiss the counterclaims based on the economic loss rule, lack of a duty to provide security, lack of responsibility for third-party criminal acts, and insufficiency of the pleading. Judge Hendricks agreed and dismissed the counterclaims. Before addressing the legal arguments, Judge Hendricks noted the “threadbare recitals of the elements of a cause of action, supported by mere conclusory statements” (quoting Bell Atlantic Corp. v. Twombly). With respect to the legal arguments, Judge Hendricks agreed that the economic loss rule barred contract actions couched as tort claims and that the general maritime law did not permit Kissimmee to recover for failure to provide security or failure to protect Kissimmee from the criminal acts of third parties. Finally, Judge Hendricks did not believe that the warranty of workmanlike performance should extend to the lease of the dock that did not give Republic any control of the vessel or require it to undertake services to the vessel.

Suit in state court alleging severe and permanent personal injuries was held to be sufficient to trigger the running of the 6-month period to file a federal limitation of liability action; In re Hornstein, No. 19-cv-5795, 2020 U.S. Dist. LEXIS 181338 (E.D.N.Y. Sept. 30, 2020) (Irizarry).

Opinion

Robert J. Giordano and Corinne Lee Furnan brought a lawsuit on July 12, 2018, in New York State court against Steven S. Hornstein in connection with a boating accident. The suit sought unspecified damages for pain and anguish together with property damage in the amount of $15,000. Hornstein made several demands for information and documents to support the damages, and after receiving photographs in June 2019 from the night of the accident, filed this limitation action on October 14, 2019, seeking to limit his liability to the value of his 24-foot Boston Whaler in the amount of $102,000. Magistrate Judge Tiscione ruled that the limitation action was untimely, and Judge Irizarry agreed. Hornstein argued that the six-month period to file limitation was not triggered by the unspecified damages that were pleaded in the suit filed in state court and that he had diligently sought to determine the amount of damages at issue before seeking limitation. Judge Irizarry rejected that argument, however, noting that the allegation that Giordana had suffered “severe” and “permanent” injuries was sufficient to put Hornstein on notice that the amount of damages would exceed the value of the Boston Whaler and started the running of the six-month period to file the federal action.

Plaintiff did not lose its jury trial from its complaint based on diversity when the plaintiff responded to a counterclaim by agreeing to admiralty jurisdiction over the complaint and by filing a responsive third-party complaint based on admiralty jurisdiction; Marquette Transportation Co. Gulf-Inland, LLC v. Navigation Maritime Bulgarea, No. 19-10927, 2020 U.S. Dist. LEXIS 181989 (E.D. La. Oct. 1, 2020) (Brown).

Opinion

The complicated pleadings in this case arose from a collision in the Mississippi River between Marquette’s vessel, the KIEFFER BAILEY, and Balkan’s vessel, the M/V STRANDJA. Marquette brought this action against Balkan, seeking to recover for damage to the barge, loss of use, other expenses, and contribution and indemnity from Balkan for the injuries to members of the crew on the KIEFFER BAILEY. Marquette premised jurisdiction on diversity and demanded a jury trial. Balkan answered and filed a counterclaim against Marquette and a third-party action against the KIEFFER BAILEY, in rem, seeking to recover for damage to the STRANDJA. Marquette answered the counterclaim, admitting the admiralty jurisdiction in the counterclaim and bringing a third-party claim against Crescent Towing premised on admiralty jurisdiction, designating Rule 9(h), and tendering Crescent as a direct defendant to Balkan in accordance with Rule 14(c). Marquette then amended its original complaint to name the STRANDJA, in rem, but it later dismissed the amended complaint. Balkan then sought to strike Marquette’s demand for a jury trial on the grounds that the amount in controversy necessary for diversity was not satisfied and because Marquette’s subsequent pleadings were inconsistent with the right to a jury trial. Chief Judge Brown disagreed. Although documents from Marquette and its in rem complaint indicated that the damage to the KIEFFER BAILEY was $51,682.37, Chief Judge Brown noted that Marquette had also asked for loss of use and contribution/indemnity. She distinguished between removal of cases based on diversity, in which the defendant has to establish that the amount in controversy is more than $75,000 and cases brought in federal court where the allegations of the plaintiff control unless it appears to a legal certainty that the claim is actually less than the jurisdictional minimum. Following the guidance of the Fifth Circuit in Luera v. M/V ALBERTA, Chief Judge Brown separately reviewed the claims that were presented and reasoned that Marquette was not basing its claims against Balkan on admiralty. Marquette admitted that Balkan’s counterclaim was based in admiralty, and Marquette’s third-party claim was based in admiralty, but after the dismissal of its amended complaint, its claims against Balkan were based on diversity. Therefore, Marquette was entitled to a jury trial on those claims. Whether all of the claims in the case would be tried to a jury to avoid inefficiency and bifurcation would have to wait for a motion to that effect. All that was at issue at this time was Balkan’s motion to strike Marquette’s request for a jury trial, and that was denied.

Court remanded case removed on original admiralty jurisdiction but declined to award attorneys’ fees as sound jurisprudence supported the position that the removal was proper; Trahan v. Teche Towing Inc., No. 6:20-cv-1004, 2020 U.S. Dist. LEXIS 195044 (W.D. La. Oct. 1, 2020) (Hanna), recommendations adopted, 2020 U.S. Dist. LEXIS 194213 (W.D. La. Oct. 19, 2020) (Juneau).

Tracey Trahan and Puky’s Seafood filed suit against Teche Towing in Louisiana state court after the vessel that Trahan was captaining, the F/V CAPTAIN ANTHONY PUKY TRAHAN, allided with a dredge pipe being tended by Teche Towing’s vessel, M/V JAX. Teche Towing removed the case to federal court based on the court’s original admiralty jurisdiction, and the plaintiffs moved to remand the case to state court. Recognizing the disagreement among the district courts, Magistrate Judge Hanna agreed with the cases concluding that the saving-to-suitors clause bars removal of cases based on original admiralty jurisdiction and consequently recommended that the case be remanded. However, as there was “sound jurisprudence” to support removal, Magistrate Judge Hanna recommended that attorneys’ fees and costs not be awarded for an improper removal. On October 19, 2020, Judge Juneau adopted Magistrate Judge Hanna’s recommendations and remanded the case to state court.

Opinion

Damage to vessel from overflowing bilge caused by lack of maintenance was excluded from the hull policy, and the ship repairer/storage yard was not liable for the damage as a bailee; Great Lakes Insurance SE v. A & C Holdings, LLC, No. 19-12388, 2020 U.S. Dist. LEXIS 182593 (E.D. La. Oct. 2, 2020) (Zainey).

Opinion

George Ackel discovered damage to his vessel VOODOO while it was moored at Seabrook Harbor. The bilge pumps failed to operate and water accumulated in the bilges until it overflowed into the lower deck stateroom and engine compartment. The vessel’s hull insurer, Great Lakes, declined to pay for the claim and brought this declaratory judgment action against Ackel and his company, A & C Holdings. Ackel then brought Seabrook Marine (where the vessel was docked and repaired) into the suit on the ground that the damage was the result of its repair or securing of the vessel. The evidence established that lack of maintenance caused the overflowing of the bilges and the failure of the pumps to remove the water from the bilges. Great Lakes argued that this damage was not the result of an accident; however, the policy did not define “accidental,” so Judge Zainey looked to the law applicable under the policy, New York law. Concluding that the policy was ambiguous in the circumstances of this case, Judge Zainey held that the damage was within the coverage grant of the policy. However, he held that the policy did not afford coverage because the exclusion for losses due to lack of maintenance applied. Ackel presented a proximate causation argument that the lack of maintenance may have caused the damage to the bilge pumps, but the damage to flooring, wall coverings, and furnishings was not a foreseeable result of the lack of maintenance. However, as the policy language excluded damage that resulted directly or indirectly from lack of maintenance, Judge Zainey held that the damage was excluded from the policy. Once the cause of the loss was determined, Ackel tried to pivot from the assertions in his third-party action against Seabrook Marine to assert that Seabrook Marine was responsible for maintaining his vessel as a bailee. Regardless of the failure to plead this theory, Judge Zainey rejected it because the evidence established that Ackel was paying to dock his vessel at Seabrook Marine’s marina, and maintenance was only performed as requested. As such, Ackel did not present any basis for Seabrook Marine’s liability, and Judge Zainey held that Seabrook Marine was entitled to judgment as a matter of law on Ackel’s claims.

Providing a service in furtherance of a vessel’s mission but not directly to the vessel did not give rise to a maritime lien; failure to obtain security or collect amounts due might be a maritime tort; Arc Controls, Inc. v. M/V NOR GOLIATH, No. 1:19-cv-391, 395, 2020 U.S. Dist. LEXIS 182661, 186718 (S.D. Miss. Oct. 2, 8, 2020) (Guirola).

Arc Controls opinion

Candy Apple opinion

Goliath Offshore bareboat chartered the M/V NOR GOLIATH to Magrem Investments with Epic Companies guaranteeing Magrem’s obligations. Epic used the vessel to perform platform decommissioning work in the Gulf of Mexico. Arc Controls arrested the vessel after it was not paid for a diving system that was requested by Epic to support the mission of the vessel in its offshore construction work. Candy Apple, L.L.C. intervened in the action, asserting Epic had chartered its vessel, the M/V CANDY APPLE, to transport fuel, crew, and materials to the NOR GOLIATH and that Candy Apple had a maritime lien on the NOR GOLIATH. Goliath Offshore counterclaimed against Candy Apple, alleging negligence, breach of a maritime contract, and foreclosure of a maritime lien. Goliath argued that the failure and delay of Candy Apple to collect amounts owed to Candy Apple from Epic caused damages to Goliath. Arc Controls then moved for summary judgment on its lien claim, and Candy Apple moved to dismiss Goliath’s counterclaim. Both motions raised the question whether services performed in furtherance of a vessel’s mission can give rise to a maritime lien. Arc argued that the saturation diving unit it provided supported the mission of the NOR GOLIATH, but Goliath responded that the saturation diving unit was sold to Epic to assist in the decommissioning project and that the unit moved among vessels and was not a permanent fixture on Goliath’s vessel. Finding a fact question whether the unit was supplied directly to the NOR GOLIATH, Judge Guirola declined to grant summary judgment on Arc Control’s claim of a lien. Turning the argument around, Goliath contended that the decommissioning services it provided to Epic were necessaries as to the CANDY APPLE, enabling it to perform its function and indirectly benefitted the vessel by giving it the opportunity to work on behalf of Epic. Judge Guirola rejected that claim as the services may have benefitted Candy Apple, but they were not provided directly to the CANDY APPLE. Judge Guirola also denied Goliath’s claim of breach of contract as Goliath did not have a contract with Candy Apple. However, Judge Guirola did deny Candy Apple’s motion to dismiss Goliath’s negligence claim that Candy Apple owed Goliath a duty to recover payments owed by Epic to Candy Apple, reasoning that the controlling question of whether a duty was owed was better addressed in a motion for summary judgment.

Seaman’s internal complaint of an attempted unsafe work practice was protected by the Seaman’s Protection Act; West v. American River Transportation Co., No. 4:20-cv-313, 2020 U.S. Dist. LEXIS 184150 (E.D. Mo. Oct. 5, 2020) (Ross).

Opinion

Kaare West had a verbal confrontation with a co-worker who was attempting, by himself, to detach a vessel from barges (which West considered to be unsafe). West complained about the attempted unsafe work to his supervisor and the human resources department for his employer, and was terminated by his employer. West then brought this action based on age and race discrimination and retaliation as well as for violation of the Seaman’s Protection Act (SPA). His employer sought to dismiss the count of violation of the SPA on the ground that West did not allege protected activity under the SPA, but Judge Ross disagreed. Judge Ross ruled that internal complaints are protected activities under the 2010 amendments to the SPA and that the protected activity extends to attempted violations of the maritime law as well as actual violations. Consequently, the allegations were sufficient to avoid the employer’s motion to dismiss.

Court had admiralty jurisdiction over limitation action brought by an excursion company for a jetboat accident on a river that was navigable despite falls and rapids; In re Grants Pass Jetboats, Inc., No. 1:19-cv-1294, 2020 U.S. Dist. LEXIS 186107 (D. Ore. Oct. 5, 2020) (McShane).

Opinion

Dione Young was injured during a jetboat excursion on the Rogue River in Oregon when she was ejected from a jetboat during a high-speed turn and was struck by another jetboat. The excursion company that owned the jetboat brought this action seeking limitation of liability, and Young moved to dismiss the action for lack of admiralty jurisdiction, asserting that the accident did not occur on navigable waters and lacked a sufficient nexus to traditional maritime activity. The Rogue River flows from its headwaters near Crater Lake National Park to the Pacific Ocean at Gold Beach, Oregon. Downstream from where the accident occurred, there are rapids and falls. However, the falls and rapids do not obstruct navigation on the river all of the time, and the river has been used historically to transport people, goods, and recreational watercraft. Consequently, Judge McShane held that the river was navigable, despite restrictions on the use of portions of the river that have been designated as a “Wild River Area.” As the accident involved vessels carrying passengers, and as it involved a passenger thrown into the water where search-and-rescue-operations could “ensnarl maritime traffic,” Judge McShane held that the incident was sufficiently connected to traditional maritime activity. Therefore, he denied the motion to dismiss.

Passenger’s suit against cruise line for injury during Monkey Jungle shore excursion survived the cruise line’s motion to dismiss the negligence counts for lack of notice, the joint venture count based on the independent contractor provision of the tour operator agreement, and the count alleging breach of a non-delegable duty to provide a safe shore excursion; Holcomb v. Carnival Corp., No. 20-22429, 2020 U.S. Dist. LEXIS 186214 (S.D. Fla. Oct. 6, 2020) (Torres).

Opinion

Rhonda Holcomb, a passenger on the cruise ship CARNIVAL SENSATION, slipped and fell on wet stairs during the Monkey Jungle shore excursion in the Dominican Republic. She brought this suit against the cruise line and shore excursion, and the cruise line moved to dismiss several counts alleged against it. Magistrate Judge Torres recommended that the motion to dismiss be denied, finding sufficient allegations of notice of the dangerous condition to support the negligence counts against the cruise line. Although there were insufficient general allegations about the industry being plagued with injuries during shore excursions, Magistrate Judge Torres found sufficient pleading of notice based on cruise line personnel visiting and participating in the excursion and observing the slippery staircase as well as passenger feedback about the dangerousness of the excursion. Magistrate Judge Torres also found sufficient pleading of a joint venture between the cruise line and excursion operator despite the provision in the tour operator agreement that the excursion operator was an independent contractor, noting that the complaint did not mention the agreement and was based on theories of tort liability so that the agreement was not essential to the passenger’s allegations. Finally, Magistrate Judge Torres found the allegations of a non-delegable duty to provide a safe excursion were sufficient based on oral representations that modified the shore excursion contract and vouched for the safety of the excursion operator.

Court dismissed accounting action against parties who were alleged to have worked with the injured seaman’s employer to wrongfully transfer the employer’s commercial use permit; Barnes v. Sea Hawai’i Rafting, LLC, No. 13-2, 2020 U.S. Dist. LEXIS 185831 (D. Haw. Oct. 7, 2020) (Kay).

Opinion

The long saga of Barnes’ lawsuit seeking to recover from his 2012 injury returns to the Update. Eight years after his accident on his employer’s vessel, Barnes’ latest pleading named additional defendants for their involvement in the wrongful transfer of his employer’s commercial use permit for the vessel. Barnes alleged causes of action for intentional infliction of emotional distress and for an accounting. After dismissing the actions for intentional infliction of emotional distress because the claims exceeded the scope of leave granted by the court, Judge Kay addressed the claims for an accounting. Judge Kay dismissed those claims for multiple reasons. First, Barnes did not allege any confidential or trust relationship between the defendants and Barnes or that the defendants had been entrusted with any money belonging to Barnes. Second, an accounting was not necessary because Barnes did not allege that he lacked an adequate remedy at law. Third, the information sought in the accounting was available through discovery proceedings. Finally, accounting claims are a remedy, not a stand-alone cause of action.

Suit for damage to oyster leases caused by push boats was remanded to state court; judge held that the case could not be removed based on original admiralty jurisdiction or based on diversity, declining to hold that the vessel operator was improperly joined for claims of negligence and trespass under state law; Alexis v. Hilcorp Energy Co., No. 20-2289, 2020 U.S. Dist. LEXIS 186547 (E.D. La. Oct. 8, 2020) (Ashe).

Opinion

This suit was brought in Louisiana state court by the owner of two oyster leases that were damaged by push barges hired by Hilcorp to assist in the performance of services on Hilcorp’s well. The suit named Hilcorp, which is diverse from the plaintiff, and two non-diverse defendants, the operators of the push barges. Hilcorp removed the case to federal court based on the original admiralty jurisdiction of the federal court and diversity (asserting that the non-diverse defendants were improperly joined). Judge Ashe noted the different lines of authority on removal based on original admiralty jurisdiction and accepted the majority view that maritime claims cannot be removed without an independent basis of subject matter jurisdiction. Even though the damage was alleged to have arisen from a vessel, Judge Ashe analyzed the claims against the non-diverse defendants, alleged to be operators of the vessels, under Louisiana trespass and negligence law. Concluding that the suit alleged valid actions under Louisiana law, Judge Ashe held that the claims against the non-diverse operators were not improperly pleaded and therefore defeated diversity jurisdiction. Consequently, he remanded the case to state court.

Court declined to grant summary judgment that the seaman was owed maintenance and cure; Richard v. Weber Marine, LLC, No. 20-580, 2020 U.S. Dist. LEXIS 186904 (E.D. La. Oct. 8, 2020) (Barbier).

Opinion

Roin Christopher Richard, Jr. was serving on the M/V MISS RACHEL, owned and operated by Weber Marine, when the vessel was struck by a runaway barge. Richard did not complain of any injury at the time of the allision or before his shift ended three days later. Less than two weeks later, Richard sought employment with Intracoastal Tug, and he denied any prior injuries to his back, neck, or wrist during his pre-employment physical.  After he was fired by Intracoastal Tug, Richard applied for work with Central Boat Rentals and again denied any pre-existing injuries to his back, neck, or wrist. In the interim, he returned to work for three days with Weber Marine without mentioning any injury from his prior work on the MISS RACHEL. After Richard was denied employment by Central Boat Rentals because of a protrusion in his cervical vertebrae and high blood pressure, he sent a demand for maintenance and cure to Weber Marine and then brought this suit, asserting injuries to his neck, back, and wrist during the allision. Weber Marine’s investigation also revealed that Richard was involved in an automobile accident in 2017 and received treatment for back and neck pain, and Weber Marine declined to pay maintenance and cure to Richard. Richard then filed a motion for summary judgment on his maintenance and cure claim, and Judge Barbier noted that Richard was only required to show that an accident occurred in which Richard was injured or that a medical condition manifested itself in the service of the vessel. However, the facts about the prior injury and subsequent employment efforts demonstrated that there were material issues of fact whether Richard’s cervical and other conditions were caused by the allision or manifested themselves during his service on the MISS RACHEL. Accordingly, Judge Barbier denied Richard’s motion for summary judgment.

Indemnity is awarded on an accident-by-accident basis; employer who paid maintenance and cure after a seaman’s second accident was not entitled to indemnity from the party responsible for a prior accident in which the seaman sustained injuries to the same areas of her body; Poincon v. Offshore Marine Contractors, Inc., No. 18-10251, 2020 U.S. Dist. LEXIS 187820 (E.D. La. Oct. 9, 2020) (Ashe).

Opinion

Sonia Poincon sustained an injury to her neck and back in May 2015 while employed by Offshore Marine on the M/V LOUIS J. EYMARD, a vessel owned by United Community Bank, when that vessel was involved in a collision with a vessel operated by REC Marine. Poincon sustained a second injury to her neck and back in February 2018 while employed by Offshore Marine on the M/V TOBY DODD. Poincon brought this suit against Offshore Marine, United Community Bank, and REC Marine seeking to recover for both injuries, and the court severed the claims into two suits. Offshore Marine, the sole defendant in the suit for the second accident, brought a third-party action against REC Marine, asserting that it was entitled to indemnity and contribution for the maintenance and cure it paid to Poincon for the second accident to the extent that the payments resulted from the 2015 accident that was the fault of REC Marine. REC Marine filed a motion for summary judgment with respect to the claim for indemnity and contribution, and Judge Ashe agreed and dismissed the third-party action. Judge Ashe noted that a third party whose fault has contributed to the need for maintenance and cure payments is responsible for reimbursement of the payments made by a non-negligent or passively negligent employer. However, that principle has been enunciated in cases where the contributing fault was for the same accident for which maintenance and cure was being paid, not when there have been two independent accidents. Holding that responsibility for maintenance and cure should be determined “on an accident-by-accident basis,” Judge Ashe held that “a first accident’s maintenance and cure obligation ends where a second accident’s begins.” Consequently, he held that REC Marine had no obligation to contribute to the maintenance and cure paid by Offshore Marine for Poincon’s second accident.

Change in welder’s assignment resulted in denial of his seaman’s claims; Walker v. Sunland Construction, Inc., No. 19-338, 2020 U.S. Dist. LEXIS 188743 (E.D. La. Oct. 13, 2020) (Guidry).

Opinion

Brandon E. Walker was hired by Sunland Construction to work as a welder on its project Cochon, a contract to replace an eight-mile segment of a pipeline running between Lake Lery and Lake Borgne in St. Bernard Parish, Louisiana. Walker was standing on a small work pontoon when a Jon boat approached and he put out his foot to stop the boat from colliding with the pontoon. Walker fell overboard and brought this suit against Sunland Construction as a Jones Act seaman. Sunland Construction filed a motion for summary judgment on the seaman’s claims, arguing that during the first part of Walker’s employment he had performed his welding work from a barge, but that his job permanently changed before his accident so that he was working either on land or on small pontoons positioned at the shoreline or in a non-navigable pipe ditch that had been excavated by Sunland Construction. Evaluating Walker’s connection based on his work after the change, Judge Guidry concluded that the worker failed to establish a fact question on the connection element of the seaman status test because the majority of his work was done on land and the remaining work was not performed on a vessel in navigation.

21 years after the seaman’s accident, the court confirmed the arbitration award to an Indian national who was serving as an engine cadet on a vessel in international waters; Neptune Shipmanagement Services (Pte.), Ltd. v. Dahiya, No. 20-1525, 2020 U.S. Dist. LEXIS 190093 (E.D. La. Oct. 14, 2020) (Feldman).

Opinion

The injury claim of Vinod Kumar Dahiya returns to the Update after years of contentious proceedings resulted in an arbitration award of $130,000 in India for Dahiya’s 1999 injury while serving as an engine cadet on the M/T EAGLE AUSTIN in international waters. Dahiya’s injury suit in state court was removed to federal court where it was heard by Judge Feldman together with his employer’s suit that was brought in federal court to confirm the arbitration award. After Judge Feldman declined to remand the case that was removed to federal court (October 2020 Update), Dahiya “press[ed] on in an increasingly quixotic bid to win greater damages in the United States.” Judge Feldman “end[ed] that effort.” He confirmed the arbitration award and enjoined all pending or future legal actions arising from Dahiya’s injury in 1999.

Offshore tension-leg platform owner owed no duty to injured roustabout employed by an independent contractor absent operational control over the contractor; Hosey v. Shell Oil Co., No. 19-9816, 2020 U.S. Dist. LEXIS 190095 (E.D. La. Oct. 14, 2020) (Feldman).

Opinion

Shell, owner and operator of the Olympus tension-leg platform on the outer Continental Shelf, offshore Louisiana, engaged Helmerich & Payne to provide personnel for drilling, completion, and other operations. H&P hired David Hosey as a roustabout, and he was injured while moving a washing machine on the platform. Hosey brought this suit against Shell for negligence. Shell moved for summary judgment on the ground that it owed no duty to Hosey for activities of Shell’s contractor, H&P, in the course of performing work as an independent contractor. As there was no evidence that Shell exercised operational control over H&P, Judge Feldman agreed that Shell owed no duty to Hosey and granted the motion for summary judgment, applying Louisiana law as surrogate federal law under the Outer Continental Shelf Lands Act.  However, even if Shell did owe a duty to Hosey, the evidence did not establish that Shell breached that duty. In hindsight, Hosey asserted a theory of negligence that he did not have access to a dolly to move the washing machine during the night shift. The problem with that theory was that neither Hosey nor his co-worker or supervisor considered locating a dolly to perform the work, and the task was considered by H&P to be one that could safely be performed by Hosey and his co-worker.

Fact questions precluded summary judgment for the marina and vessel owner for damage to the marina’s dock during Hurricane Irma; the vessel owner’s attorney was not disqualified for prior work for the marina; Crown Bay Marina, L.P. v. Reef Transportation, LLC, No. 18-73, 2020 U.S. Dist. LEXIS 192171, 195510 (D.V.I. Oct. 16, 21, 2020) (Miller).

Reef opinion

Disqualification opinion

Reef secured its vessels MORNING STAR and EVENING STAR at Crown Bay Marina docks in anticipation of Hurricane Irma making landfall on St. Thomas. Both vessels remained tied to the dock during the storm, but the dock sustained damage and the marina brought this action seeking to recover for the cost to repair and restore the facility. Reef moved for summary judgment on the claims, and the marina filed a cross-motion for summary judgment. Reef’s motion was based on the fact that the vessels did not sustain significant damage and remained securely moored in their slips. The marina asserted that Reef was liable for the damage to the dock pursuant to the provision in the License Agreement for Dockage, which provided that Reef would be liable for all damages to facilities caused by the vessels. The parties presented substantially different versions of what caused the damage, resulting in Judge Miller concluding that negligence and causation were disputed so that Reef’s motion could not be granted. As causation was unresolved, she likewise could not determine whether the contractual provision allocated responsibility to Reef and denied the marina’s motion. Judge Miller then addressed the marina’s motion to disqualify the attorneys for Reef on the ground that they had previously given advice to the marina with respect to the License Agreement for Dockage. However, the attorneys did not draft the document or give advice on the sufficiency or enforceability of the contract. Therefore, as the work was not substantially related to the issues in litigation, Judge Miller declined to disqualify counsel for Reef.

Fact questions precluded summary judgment for the marina and vessel owner for damage to the marina’s dock during Hurricane Irma, and the court deferred ruling on the vessel owner’s gist of the action argument; Crown Bay Marina, L.P. v. Subbase Drydock, Inc., No. 18-68, 2020 U.S. Dist. LEXIS 192172 (D.V.I. Oct. 16, 2020) (Miller).

Opinion

Subbase Drydock, a marine repair and maintenance company, was agent and custodian of the vessels M/V CULEBRA II and M/V CARIBENA. When Hurricane Irma approached St. Thomas, Subbase secured the vessels at Crown Bay Marina and signed the marina’s License Agreement for Dockage for the vessels. Both vessels broke free during the storm, and the marina brought this suit seeking to recover from Subbase for the damage sustained by the marina. Subbase moved for summary judgment that it was not the party that was responsible under the agreement and that the marina’s negligence claim was precluded by the gist of the action doctrine. The marina argued in its cross motion for summary judgment that Subbase was liable under the contracts to the same extent as the vessels’ owner. Concluding that the contract was ambiguous with respect to the responsibility of Subbase, Judge Miller declined to grant summary judgment to either party on the contract claim. With respect to the marina’s tort claim, Subbase argued that the duties asserted by the marina flowed from the contract, which addressed the responsibility for the breach of those duties. Thus, the tort claim could not stand apart from the contract claim (gist of the action doctrine). The marina argued that Subbase could be liable in tort regardless of whether there was a contract, and that it could certainly have sued Subbase for its alleged negligence if there had not been a contract. As neither party addressed what law should govern the application of the gist of the action doctrine or whether maritime law recognizes this common-law doctrine, Judge Miller deferred ruling on the motion and requested additional briefing.

Employer who paid maintenance, advances, and out-of-pocket expenses for medical treatment that were not paid by the seaman’s wife’s insurer was not liable for any additional amounts in maintenance and cure or for failure to pay maintenance and cure; Aadland v. Boat Santa Rita II, Inc. No. 17-cv-11248, 2020 U.S. Dist. LEXIS 191573 (D. Mass. Oct. 16, 2020) (Casper).

Opinion

The claims of Magnus Aadland return to the Update (see December 2019 Update). Aadland fell ill while serving as the Captain of defendant’s F/V LINDA. He was hospitalized for streptococcus and eventually had to have two cardiac surgeries. His treatment was paid first by his wife’s health insurance, then by COBRA, and then by Medicare. The defendant paid maintenance at the rate of $84 per day retroactive to Aadland’s discharge from the hospital, and also paid “advances” at the rate of $114 per day (including periods of subsequent hospitalization). Aadland used the advances to pay for living expenses, including medical insurance premiums. The total paid for maintenance was $175,644, and the amount paid for advances was $328,374. The defendant also reimbursed out-of-pocket medical expenses. Aadland brought this action seeking to recover for Jones Act negligence, unseaworthiness, maintenance and cure, and failure to pay maintenance and cure. A trial was held on his claims for maintenance and cure and for failure to pay maintenance and cure, and Judge Casper denied all of the claims. She concluded that Aadland had reached maximum cure as he had been discharged from occupational therapy and was only seeing his doctors every six months for checkups. She also held that Aadland was not entitled to maintenance during the period when he was initially hospitalized. There were no outstanding medical expenses that Aadland was obligated to pay, and the record did not reflect that there were any unreasonable delays in payment of maintenance. Finally, Judge Casper held that Aadland’s employer was not liable for any failure to pay maintenance and cure.

Court struck passenger’s claim for punitive damages against cruise line for failure to state sufficient factual allegations.  Roberts v. Carnival Corp., No. 1:19-cv-25281, 2020 U.S. Dist. LEXIS 194403 (S.D. Fla. Oct. 19, 2020) (Moore).

Opinion

Debra Roberts brought this suit seeking to recover damages, including punitive damages, from the cruise line for injuries resulting while a passenger on a cruise when she fell over a threshold that ran across a hallway on the ship. In support of her claim for punitive damages, Roberts asserted that the cruise line knew of the danger because of prior incidents and failed to take proper precautions–intentionally concealing the defect. Chief Judge Moore noted that the Eleventh Circuit had ruled that punitive damages were available in cases of personal injury under general maritime law in cases of intentional conduct. However, in this case, without any factual allegations to support the allegation that the acts of the cruise line were intentional, deliberate or so wanton or reckless as to demonstrate a conscious disregard of rights of others, Chief Judge Moore struck the paragraph in the complaint alleging punitive damages.

Court declined to certify a class action in passengers’ COVID-19 suit against cruise line based on the class action waiver in the passengers’ contract; Archer v. Carnival Corp., No. 2:20-cv-4203 (C.D. Cal. Oct. 20, 2020) (Klausner).

Opinion

Robert Archer and other passengers on the GRAND PRINCESS during a cruise from San Francisco to Hawaii brought this class action against the cruise line for exposure to COVID-19 on the cruise. The passengers moved to certify their class and to appoint class representatives and counsel, but Judge Klausner denied the motion. The passengers did not dispute that they assented to the terms of their passage contracts, which included class action waivers, but they argued that the waivers were unenforceable. After finding that the reasonable communicativeness test was satisfied, Judge Klausner subjected the contracts to judicial scrutiny for fundamental fairness and found no evidence of bad-faith motive, fraud, overreaching, or that the waivers discouraged the passengers from pursuing legitimate claims. He also concluded that the contracts were not procedurally or substantively unconscionable and that the contracts were not void as a matter of public policy. Consequently, as the class certification was barred by the contracts, he denied the motion for certification.

Business interruption claims of testing and inspection company as a result of port closures during Hurricane Harvey were not covered under the company’s property insurance policy; Evanston Insurance Co. v. AmSpec Holding Corp., No. 4:19-cv-1498, 2020 U.S. Dist. LEXIS 193902 (S.D. Tex. Oct. 20, 2020) (Sheldon).

Opinion

AmSpec inspectors travel to ports, refineries, and terminals along the Gulf Coast to inspect barges and vessels, taking samples and testing the samples in the company’s laboratories. Although its facilities did not sustain physical damage during Hurricane Harvey, AmSpec asserted that it suffered business interruption from the closure of the ports in Houston, Texas City, Galveston, Corpus Christi, and Port Arthur. AmSpec then made a claim against its property insurer, Evanston, which denied the claim and brought this declaratory judgment action. The policy language required that a civil authority order must be one that is “a result of direct physical loss of or damage to property.” Evanston argued that there had to be a causal link between prior direct physical damage and the civil authority, and AmSpec argued that the orders only had to be the result of physical damage that was happening elsewhere. Magistrate Judge Sheldon reasoned, however, that, even with AmSpec’s interpretation, there had to be a causal link between the civil authority order and damage elsewhere, but there was no nexus between the issuance of the closure order and damage. As such, the claim was not covered under the specific language of the policy.

Court denied travel insurance defendants’ motion to dismiss cruise passenger’s claims for recovery for injuries sustained as a result of breach of insurance contract, and granted the cruise line’s motion to dismiss claims of negligent hiring and training.  Christie v. Royal Caribbean Cruises, Ltd. No. 20-22439, 2020 U.S. Dist. LEXIS 194823 (S.D. Fla. Oct. 21, 2020) (Scola)

Opinion

William Christie began experiencing severe back pain while a passenger aboard the cruise ship SYMPHONY OF THE SEAS. He sought medical treatment from vessel doctors on several occasions as his condition worsened, and he was eventually referred by onboard doctors to a local hospital. As a result of the unavailability of an MRI machine, Christie faced a delay in receiving the necessary medical care, ultimately resulting in permanent injury. Christie claimed that travel insurer, Jefferson Insurance, and policy servicer, AGA Service Company, were liable for damages caused by a delay in obtaining treatment because they declined to permit Christie’s airlift to another facility. Judge Scola denied the insurance defendants’ argument in their motion to dismiss that the policy does not contemplate coverage for specific alleged damages and other tort compensatory damages, concluding that Christie adequately pleaded that his injuries were a foreseeable consequence of the insurance defendants’ failure to coordinate an emergency airlift. Judge Scola also denied the insurance defendants’ motion to dismiss claims for negligent failure to coordinate medical care on the ground that Christie could not plead an independent tort beyond the reach of the contract, holding that he had sufficiently pleaded a claim under the Florida undertaker’s doctrine (one who undertakes to provide a service, whether by contract or gratuitously, assumes a duty to act carefully). Judge Scola did, however, grant the cruise line’s motion to dismiss Christie’s claims of negligent hiring, selection, retention, monitoring, and training of the onboard medical staff, finding the pleading did not adequately allege facts of plausible claims, and that the impermissible shotgun pleading failed to assert distinct theories of liability with supporting factual allegations for each theory. Consequently, Judge Scola denied the insurance defendants’ motion to dismiss in its entirety, and granted the cruise line’s motion to dismiss, ordering Christie to amend his allegations.

Court declined to limit expert testimony in towboat deckhand’s action for damages resulting from injury sustained during tow-building process. Hodges v. Parker Towing Co. Inc., No. 19-01736, 2020 U.S. Dist. LEXIS 197038 (E.D. La. Oct. 23, 2020) (Guidry).

Opinion

Kelly Hodges, a deckhand employed by Parker Towing, suffered an injury to his shoulder while building a tow of barges for the M/V THELMA PARKER II. Hodges filed a motion seeking to limit Parker Towing’s expert witness, Robert Borison, to the two opinions stated in his report, excluding “maritime procedures and industry standards,” “working with tow and ratchets,” building and breaking tow,” “responsibilities of a deckhand,” and “proper training” that were not contained in his report. Hodges argued that Parker Towing had not provided a subsequent report with the opinions. Judge Guidry denied this motion, finding the report that was submitted did include information on these issues that was sufficient to comply with the requirements for an expert report and that Hodges could cross-examine Borison on these points at trial.

Court compelled arbitration of wrongful death case brought by father of crewmember on cruise ship who died after contracting COVID-19; Isanto v. Royal Caribbean Cruises, No. 20-cv-23715, 2020 U.S. Dist. LEXIS 197318 (S.D. Fla. Oct. 23, 2020) (Bloom).

Opinion

This suit was brought in Florida state court by the representative of Fnu Pujiyoko, a seaman employed by Royal Caribbean aboard the SYMPHONY OF THE SEAS, who contracted COVID-19 while onboard the vessel after the Center for Disease Control issued a no sail order. The representative sought to recover for the seaman’s death on four counts, Jones Act negligence, unseaworthiness, failure to provide prompt, proper and adequate medical care, and failure to provide maintenance and cure. The cruise line removed the case to federal court based on the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention) and then moved to compel arbitration in accordance with the terms of the Decedent’s employment agreement and collective bargaining agreement. Judge Bloom rejected the representative’s argument that the arbitration agreement was not applicable on the ground that the decedent’s employment was terminated upon the no sail order. The arbitration agreement subjected gateway issues of arbitrability to the arbitrator to decide. Additionally, Judge Bloom rejected arguments that seamen’s claims were not subject to arbitration under the New York Convention or that the agreement violated public policy. Consequently, she ordered the parties to submit to arbitration and stayed the case pending completion of the arbitration.

Louisiana products liability law did not apply in a maritime case, and claims against the non-diverse seller of oil filters to a vessel precluded removal based on diversity; Island Ventures, LLC v. K Mar Supply II, LLC, No. 20-2263, 2020 U.S. Dist. LEXIS 198329 (E.D. La. Oct. 26, 2020) (Brown).

Opinion

Island Ventures, owner of the M/V KOBE CHOUEST, brought this action in Louisiana state court against parties that manufactured and sold oil filters that were allegedly defective and caused engine failures on the vessel. The defendants removed the suit to federal court based on original admiralty jurisdiction and diversity (arguing that the non-diverse seller of the filters was improperly joined). Chief Judge Brown first determined that admiralty law applied to the case and then followed the majority rule that cases brought under the saving-to-suitors clause cannot be removed based on original admiralty jurisdiction. With respect to diversity, the defendants argued that the seller of the filters was improperly joined as a defendant and its Louisiana citizenship should not prevent complete diversity because a seller that did not manufacture a defective product is not liable under Louisiana law unless it knew or should have known that the product was defective. Chief Judge Brown disagreed, however, with the application of Louisiana law, ruling that Louisiana law was inconsistent with the Restatement (Second) of Torts that has been held to apply in maritime claims. As there was a reasonable basis for recovery against the non-diverse seller, Chief Judge Brown held there was a lack of complete diversity, and she remanded the case to the state court.

Mexican fishermen and fishing cooperatives were not entitled to recover from BP under OPA or the general maritime law for economic losses from the DEEPWATER HORIZON/Macondo blowout; In re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, No. 2:10-md-2179 (E.D. La. Oct. 26, 2020) (Barbier).

Opinion

More than ten years after the DEEPWATER HORIZON/Macondo blowout, Judge Barbier continues to address claims against BP arising from the tragedy. This case involves 115 claims of Mexican commercial fishermen and fishing cooperatives who asserted economic loss claims based on a decline in the number of fish that they caught in Mexican waters. They brought claims under both the Oil Pollution Act of 1990 and the general maritime law. Although OPA permits recovery for foreign claimants, it contains additional requirements for their claims, including that recovery be authorized by a treaty or executive agreement between the United States and the claimant’s country. The Mexican claimants asserted that their claims were authorized by two treaties; however, one was not enacted until after the claims were brought and the second, the North American Agreement on Environmental Cooperation, did not give the claimants a legally recognized interest as required by OPA. Turning to the claims under the general maritime law, Judge Barbier reconsidered his previous ruling that OPA did not displace the general maritime law (based on intervening decisions of the Fifth Circuit) and held that the maritime claims asserted by the Mexican claimants were displaced by OPA. Judge Barbier then proceeded to set forth several pages of his thoughts on federal displacement while noting that the fishermen would also have to convince the Fifth Circuit to create an exception to the economic loss rule for commercial fishermen (an issue that was not decided by the Fifth Circuit in its en banc decision in the TESTBANK case). (Your author’s view of federal displacement based on OPA is set forth in The Relationship Among General Maritime Law, OPA, and OCSLA, 25 U. San. Fran. Mar. L.J. 253 (2012-13)).

Court concluded that ship repair was performed under a contract that required arbitration and ordered that the parties arbitrate the vessel owner’s claim for damage from defective work; Savage SE Operations, LLC v. Wartsila North America, Inc., No. 4:19-cv-1681, 2020 U.S. Dist. LEXIS 198096 (S.D. Tex. Oct. 26, 2020) (Eskridge).

Opinion

Savage SE brought this action against Wartsila, asserting that Wartsila’s defective work in overhauling one of the engines on Savage SE’s vessel SULPHUR ENTERPRISE caused damage to the vessel. Wartsila responded by seeking arbitration based on its standard terms and conditions that were attached to its offers sent to Savage SE. Although Savage SE argued that no contract with an arbitration clause was formed with respect to the work, Judge Eskridge resolved that issue against Savage, holding that the facts established both the contract and its applicability to the dispute. He therefore compelled arbitration of Savage SE’s claims.

Court applied state law to claim on behalf of Navy boiler tender who died from mesothelioma allegedly caused by exposure to asbestos at land-based facilities and granted summary judgment to an insulation contractor when the plaintiff could not establish that the decedent was in proximity to a specific asbestos-containing product distributed by the defendant on a regular basis over an extended period of time; Robertson v. Air & Liquid Systems Corp., No. 3:18-cv-1842, 2020 U.S. Dist. LEXIS 198610 (D.S.C. Oct. 26, 2020) (Lydon).

Opinion

Paul Cruise was exposed to asbestos while serving as a boiler tender for the Navy from 1961 to 1965. He was also exposed to asbestos-containing products as an electrician in land-based work from 1965 to around 1980. He brought this action against asbestos suppliers and contractors seeking to recover for his mesothelioma, and his daughter continued the action after he died. One of the contractors who used insulating materials allegedly containing asbestos during Cruise’s land-based work moved for summary judgment, and Judge Lydon granted the motion. The judge applied state law to the exposure and held that the plaintiff could not establish that Cruise was in proximity to a specific asbestos-containing product distributed by the defendant on a regular basis over an extended period of time.

Instructing a subcontractor to work during hazardous weather conditions during the construction of an expansion to an offshore platform did not establish that the platform operator or its contractor controlled the details of the subcontractor’s work so as to create a duty to an employee of the subcontractor; Coleman v. BP Exploration & Production Inc., No. 3:19-cv-102, 2020 U.S. Dist. LEXIS 199396 (S.D. Tex. Oct. 27, 2020) (Brown).

Opinion

BP was engaged to complete the expansion of a platform located on the outer Continental Shelf, offshore Louisiana, and BP hired Grand Isle Shipyards to manage the construction. Grand Isle subcontracted scaffolding work to Brand Energy, which employed LeDell Coleman as a scaffold builder. The work was delayed because of bad weather, and Coleman alleged that BP and Grand Isle required Brand to proceed with the scaffold building despite the weather, resulting in Coleman’s injury. Coleman brought this action against both BP and Grand Isle under the Jones Act and general maritime law, but he dismissed those claims and proceeded under Louisiana law. The defendants moved for summary judgment on the ground that they did not owe Coleman, an employee of an independent contractor, a duty, and that they were not liable for the negligent acts of the independent contractor. Judge Brown concluded that Brand Energy was an independent contractor and that the defendants were not liable to Coleman, even if they had instructed Brand Energy to work in the weather conditions, as that did not establish that the defendants actually controlled how Brand Energy was to accomplish its work (distinguishing between telling the contractor what to do compared to how to do it). Therefore, Judge Brown dismissed Coleman’s claims against BP and Grand Isle.

From the state courts:

Appellate court affirmed the ruling that a garagekeeper’s lien under state law for storage charges on a vessel was defective and that the challenge to the lien was timely; Manufacturers & Traders Trust Co. v. J.D. Marine Service, No. 528950, 2020 N.Y. App. Div. LEXIS 5384 (N.Y. Sup. Ct. App. Div. 3d Dept. Oct. 1, 2020) (Colangelo).

Opinion

Nikki Restivo and Nichola Miceli engaged J.D. Marine Service to perform repairs on their boat. They paid the invoices for the repairs, but they did not remove the boat from J.D. Marine’s property, and J.D. Marine filed a garagekeeper’s lien pursuant to New York law, sending notice of the lien and sale by certified mail to the owners. Manufacturers & Traders Trust, which held a perfected lien on the boat, sought to recover the boat from J.D. Marine, but J.D. Marine would not release the boat without payment of its storage charges. Manufacturers & Traders then brought this action in New York state court to declare the garagekeeper’s lien null and void, and the court canceled the lien. On appeal, J.D. Marine argued that Manufacturers & Traders had not commenced the suit to determine the validity of the lien within the time period set forth in the state statute. However, the statute does not allow use of certified mail to give notice of the lien unless personal service could not be effected. Therefore, the challenge was timely and the appellate court upheld the cancellation of the lien. The appellate court did note that the contention that the lower court erred in failing to consider federal maritime law before ordering the boat to be released was not preserved for appellate review.

Court declined to award non-pecuniary losses to the child of a non-seaman for the non-seaman’s non-fatal injury on the high seas; Prickett v. Bonnier Corp., No. G058575, 2020 Cal. App. LEXIS 948 (Cal. App. 4th Dist. Oct. 13, 2020) (Bedsworth).

Opinion

Mira Chloe Prickett’s father was injured in a diving accident in French Polynesia during the filming of a webisode (advertisement) for diving equipment. Prickett brought this action in Orange County Superior Court for gross negligence of her father’s employer, and his employer sought to strike her claims for loss of society and punitive damages. After the decision of the Supreme Court in Batterton v. Dutra Group, the judge held that Prickett was not entitled to recover for loss of society or punitive damages under the general maritime law. In this appeal, Prickett asserted that her father was not a seaman and that her case was not covered under the Jones Act. As her father’s injury was not fatal, she argued that her claim did not fall within the Death on the High Seas Act. She then asked the court of appeals to allow recovery of loss of society damages based on the general maritime law. Taking his cue from the decision of the Supreme Court in Miles v. Apex Marine, Justice Bedsworth held that the court should not recognize a new remedy under the general maritime law where none had previously existed, stating: “The United States Supreme Court has cautioned us not to get ahead of Congress in defining new maritime remedies, and we will abide by this admonition.” Therefore, the court of appeals affirmed the judgment of the superior court. Thanks to John Walker with Schouest Bamdas, Soshea & BenMaier in Houston and Pamela Schultz with Kennedys in San Francisco for bringing this case to our attention.

Yacht broker recovered attorneys’ fees from buyer after successful defense of suit alleging that the yacht was defective; Price v. Gullan, No. D075332, 2020 Cal. App. Unpub. LEXIS 6895 (Cal. App. 4th Dist. Oct. 21, 2020) (Haller).

Opinion

David Price purchased a yacht, and Ronald Guillan served as a dual broker for the buyer and sellers. After the sale, Price discovered structural and mechanical problems with the yacht and learned that the yacht had sunk and was salvaged with mostly cosmetic repairs. He brought this suit against the sellers and broker in California state court, and the judge held a bench trial on the claim against the sellers and awarded judgment to Price together with prevailing party attorneys’ fees in accordance with the provision in the contract between the parties. The judge then held a bench trial on the claim against the broker and ruled that the broker had not breached any fiduciary duty to Price. The judge awarded prevailing party attorneys’ fees to the broker as a third-party beneficiary of the sales contract. Price objected on the ground that attorneys’ fees were only owed for actions that arose from or were related to the contract, and his claim for breach of fiduciary duty was based on a statutory duty under the California Yacht and Ship Brokers Act and was not based on the contract. The judge and court of appeal disagreed. Justice Haller reasoned that Price’s claims related to the sales contract even though his legal theories were based on the California statute. The broker owed the duty because of the contractual relationship, and Price owed attorneys’ fees to him as a third-party beneficiary of the contract.

Failure to comply with procedural requirement of state statute waiving sovereign immunity barred maritime injury claim against state harbor district; Lowry v. Port San Luis Harbor District, Nos. B300072, B302209, 2020 Cal. App. LEXIS 982 (Cal. App. 2d Dist. Oct. 22, 2020) (Tangeman).

Opinion

John Lowry, a harbor patrol officer who was employed by Port San Luis Harbor District in California, was injured while attempting to board a rescue boat. He brought this action under the Jones Act and general maritime law a year later, and, on the same day, faxed an application to the harbor district to present a late claim in accordance with the requirement of the California Government Claims Act that notice be provided within six months. The statute allows a claimant who misses the six-month deadline to apply to file a late claim within one year, and Lowry just made the deadline. The harbor district rejected the application, but Justice Tangeman noted that the rejection was of the claim and not the late application to file the claim. Therefore, Lowry complied with the requirement for the presentation of the claim. However, his suit was filed before allowing the harbor district to take action on the claim, and that made the suit premature under the terms of the statute. As such, his failure to comply with the condition to bringing the suit resulted in affirmance of the dismissal of his suit.

Thanks to Katherine E. Kaplan for her help in preparing this Update.

Kenneth G. Engerrand
President
Brown Sims, P.C.

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Quote:

This case is the swan song in an epic saga of unending war over trade secrets and the unlawful sales of sails. Unlike the model of the Iliad, it was ended not by men in a horse but by men in robes.

Quantum Sail Design Group, LLC v. Jannie Reuvers Sails, Ltd., No. 18-2348 (6th Cir. Sept. 10, 2020 ) (Boggs).

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