Admiralty and Maritime

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When drafting a settlement agreement, the parties almost always have competing interests. The Plaintiff will push for a vaguely-worded settlement in an attempt to take another “bite-at-the-apple” down the road; the Defendant will push for a broad, all-encompassing release of liability (i.e., “any and all claims”) in an attempt to “close-the-books” on the Plaintiff’s claims. Sometimes, the parties will compromise by executing a settlement agreement which falls somewhere in the middle. However, both parties should be aware that compromises made during the settlement negotiations can lead to unintended consequences down the road.

In Cooper v. Intern. Offshore Services, LLC, 2009 WL 5175216 (E.D. La. Dec. 17, 2009), aff’d, 2010 WL 3034497 (5th Cir. Aug. 3, 2010), the Plaintiff sustained injuries while working on a ramp connected to a vessel owned by his employer, International Marine. International Marine thereafter paid the Plaintiff benefits pursuant to the Longshore and Harbor Workers’ Compensation (“LHWCA”). After the Plaintiff recovered from his injuries, he agreed to settle his claim for “compensation” against International Marine. The text of the settlement agreement stated that the Plaintiff released International Marine from “any and all obligations […] for any benefits under the LHWCA” as a result of his accident. Id. at *2. Under § 908(i), all settlements of compensation benefits must be submitted to the District Director for approval.Continue Reading A Recent U.S. Fifth Circuit Decision Shows the Importance of Including a Release of “Any and All Claims” in a Settlement Agreement

The recent tragedy involving the Mobile Offshore Drilling Unit Deepwater Horizon has shed a very bright and very public light on a much and often litigated 159-year old law previously known to very few outside of the maritime industry—the Shipowner’s Limitation of Liability Act, (“the Limitation Act”), 46 U.S.C. § 30505 (formerly 46 U.S.C. § 183). What the Limitation Act does is entitle a vessel owner to limit its liability after a maritime incident or casualty to the post casualty value of the vessel and its pending freight, which may be zero if the vessel is a total loss, except when the loss occurred due to the vessel owner’s “privity or knowledge.” Privity or knowledge is found to exist where the acts of negligence or unseaworthiness that caused the casualty were known or should have been known to the vessel owner.

In addition to limiting a vessel owner’s liability, the Limitation Act also has several procedural benefits in that it allows the vessel owner in some instances to force all claims involving a vessel casualty to be litigated in a single Federal forum, often of the vessel owner’s choosing. Additionally, claimants in a vessel casualty can also benefit to some extent in that they have some security for their claims in a limitation proceeding because the vessel owner must either deposit the claimed value of the post-casualty vessel at issue in the registry of the Court or post a bond for such amount with the Court.Continue Reading Is the Limitation of Liability Act Going to Sink with the Deepwater Horizon?

A spar is a nautical structure designed to float with the bulk of the hull below the waves-something akin to a giant buoy. Fields v. Pool Offshore, Inc., 182 F.3d 353(5th Cir. 1999). Spars are essential to the expansion of oil production in deep water and their use has led to the legal question of their status. Are they vessels? Consistent with the Fifth Circuit Court of Appeals’s three part test, several recent decisions in Texas District Courts have found that a SPAR is a work platform and not a vessel. The finding is important since jurisdiction of a Jones Act action requires the existence of a vessel.

In Fields, the Fifth Circuit laid out the three part test to distinguish “stationary” work platforms from vessels. These factors include the function of the structure, whether it is moored or secured at the time of the accident, and that it has greater than theoretical mobility. Fields distinguished spars from drilling rigs, as rig move from site to site; spars are committed to a particular location. Spars have elaborate methods of attaching to the sea floor which would be difficult and expensive to undue; drilling rigs do not. Subsequent to Fields, the United States Supreme Court clarified that the distinction was not time dependent; that is it did not flip back and forth dependent on when the accident occurred. Following is a summary of recent cases which have applied the above test.Continue Reading District Courts Continue To Agree That Production SPARs Are Not Vessels

Electronic Discovery, or “E-Discovery”, is not considered the “novel issue” it once was. However, E-Discovery still presents problems that litigants and courts struggle with. Below is a summary of recent Louisiana Federal Court opinions dealing with the issues surrounding E-Discovery.

In Frees, Inc. v. McMillian, 2007 WL 184889 (W.D. La. Jan. 22, 2007), the Western District of Louisiana granted the plaintiff’s motion to compel. In an unfair competition and trade secret theft action, the plaintiff claimed that the defendant, a former employee, had stolen various data files. Plaintiff had unsuccessfully requested production of defendant’s laptop and desktop. The Court granted the motion to compel the defendant to produce these two items because they were the most likely places that the data files would be located. The Court did institute protective measures so as to prevent the disclosure of any irrelevant or personal information.Continue Reading Recent Developments in E-Discovery in Louisiana

In Bollinger Shipyards, Inc. v. Director, Office of Worker’s Compensation Programs, U.S. Dept. of Labor, (5th Cir. 2010) the United States Fifth Circuit upheld the award of workers compensation benefits to an undocumented immigrant worker who was injured on the job as a pipefitter.

The Bollinger plaintiff, Jorge Rodriguez, fell and allegedly injured himself while welding for his employer, Bollinger Shipyards, Inc.  At the time of his alleged injury, Rodriguez had been working for Bollinger for approximately eight months, having initially obtained employment by falsely holding himself out as a United States citizen.  Rodriguez presented Bollinger with a false Social Security Card.  Bollinger initially paid Rodriguez temporary disability benefits and reimbursed him for a portion of his medical bills.Continue Reading Immigration Status is Irrelevent Under the Longshore and Harbor Workers’ Compensation Act

By the Admiralty and Maritime Team

In Solana v. GSF Development Driller I, et al., 587 F.3d 266 (5th Cir. 2009), the United States Fifth Circuit reiterated the longstanding rule that generally, a seaman belonging to a vessel in peril cannot claim a salvage compensation for saving his vessel.

The facts in Solana are quite interesting.  As Hurricane Katrina approached the Gulf Coast, Global Santa Fe (GSF) evacuated its jack-up and anchored rigs in the Gulf of Mexico, which included the Development Driller I (DDI), a $350 million dollar semi-submersible drilling rig. The DDI’s power was shut off and its crew was evacuated.  Solana, a 20 year GSF employee and Offshore Installation Manager (OIM) of the DDI, and Lally, a ballast control operator and senior dynamic positioning operator, were among those employees who were evacuated from the rig.Continue Reading United States Fifth Circuit Reiterates Rule That Crew Members Are Not Entitled to a Salvage Award for Assistance Rendered to Their Own Vessel

It is a fairly common practice for individuals purchasing pleasure yachts to take calculated steps to minimize sales taxes on their purchases. In fact, a simple “Google” search on the subject reveals many websites offering free advice on this issue. One of the tactics suggested by several websites seems fairly simple: instead of the individual purchasing the yacht, the individual forms a corporation, and the corporation purchases the yacht.
Continue Reading Structuring the Purchase of a Vessel Through a Corporate Entity for Tax Purposes Can Have Unintended Consequences

The Limitation of Liability Act provides, inter alia, that a vessel owner may petition a district court of competent jurisdiction for limitation of liability within six months of receiving written notice of a claim.  See generally 46 U.S.C.A §§ 30501-30512 (West 2010).  If the vessel owner fails to petition the court and the six month period lapses, it is thereafter precluded from seeking the Act’s protection.  The Act, however, does not address the effect that one co-owner’s failure to file a petition for limitation has on another co-owner’s right to subsequently seek limitation of liability. In other words, if co-owner “X” of a vessel receives notice of a claim against it and fails to file for limitation of liability within the requisite six-month period, is co-owner “Y,” who did not receive notice, precluded from filing for limitation of liability?
Continue Reading Limitation of Liability – Effect of Notice to a Single Co-Owner

It is well known that a seaman who is injured on the job can file suit against his employer in negligence due to the statutory provisions of the Jones Act. 45 U.S.C.A §§ 30104.  However, in a Jones Act suit, the injured seaman is prohibited from recovering “non-pecuniary” damages from his employer, a category which includes punitive damages and loss of consortium. (1).  This limitation on recoverable damages is due to the language of Jones Act itself. Miles v. Apex, 498 U.S. 19 (1990).

In addition to bringing claims against his employer pursuant to the Jones Act, a seaman injured on the job often also files claims against non-employers. These claims are not dependant on the Jones Act, but rather general maritime law. In this situation, plaintiffs often attempt to recover non-pecuniary damages from the non-employer. Plaintiffs suggest that since there is no specific prohibition against the recovery of non-pecuniary damages in general maritime law, then why should an injured seaman be denied recovering non-pecuniary damages from non-employers?Continue Reading A Jones Act Seaman Does Not Have Greater Remedies Against A Non-Employer Than He Does Against His Employer

By the Admiralty and Maritime Team

Due to the non-pecuniary nature of pain and suffering, Jones Act seamen will often use various methods to provide the trier of fact with a concrete basis for a damage award for pain and suffering.  One method that Plaintiffs may utilize is to introduce their medical bills for the sole purpose of highlighting the cost of their medical care.  Once the bills have been admitted, Plaintiffs will argue to the trier of fact that the high dollar amount of their medical bills corroborate their pain and suffering.  Alternatively, Defendants may introduce medical bills and point to the low cost of a Plaintiff’s medical care to prove the Plaintiff’s lack of pain and suffering.Continue Reading Medical Bills Are Not Admissible to Prove Pain and Suffering