Admiralty and Maritime

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In Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc, 617 F.3d 1296 (Fed. Cir. 2010), the Federal Circuit reversed a district court’s summary judgment decision that no patent infringement occurred when a US company made an offer to sell to another US company when the sale negotiations occurred outside of the US.

Transocean filed suit for infringement of patents related to an improved apparatus for conducting offshore drilling. In order to drill for oil and other offshore resources, drilling rigs must lower several components to the seabed including the drill bit, casings, BOB’s, and the drill string. A conventional offshore drilling rig utilizes a derrick with a single top drive and drawworks that can only lower one element at a time in a time consuming process. Transocean patented a specialized derrick to improve the efficiency of lowering the above components. The specialized derrick included “two stations – a main advancing station and an auxiliary advancing station that can each assemble drill strings and lower components to the seabed.” Id. at 1301. This duel-activity rig could significantly decrease the time required to complete a borehole. Id at 1302. Transocean sued Maersk rig for infringement of the specialized derrick patent.Continue Reading Parties Cannot Avoid Patent Infringement by Conducting Negotiations Outside the United States for Products that will be Delivered and Utilized in the United States

On July 15, 2011, the House of Representative, Committee on Energy and Power, Subcommittee on Energy and Commerce held hearings on a draft of the “Pipeline Infrastructure and Community Protection Act of 2011.”  Chairman Fred Upton’s initial comments focused on recent pipeline incidents: the 20,000 barrel oil spill into Talmadge Creek, Michigan in the summer…

In response to the Gulf of Mexico Deepwater Horizon Incident, the Louisiana Department of Natural Resources (“DNR”), Office of Conservation (“Conservation”) issued a series of emergency rules with effective dates: July 15, 2010(1) , December 9, 2010(2), January 12, 2011(3) and most recently May 12, 2011(4).  . The initial emergency…

Deepwater oil and gas production from the Gulf of Mexico has become a significant portion of the current production within the United States, equal to over 1.6 million barrels per day of oil equivalent; total U.S oil production is around 5.3 million barrels per day. (1)  Worldwide shallow water oil production peaked around the year 2000 whereas worldwide deep water production has risen to around 5 million barrels per day. On May 10, 2011, the Bureau of Ocean Energy Management, Regulation and Enforcement (“BOEMRE”) approved Royal Dutch Shell’s Exploration Plan S-0744 to better define discoveries announced in 2009 and 2010. (2) 

Several environmental groups filed suit in an attempt to block the approved plan. Gulf Restoration Network, Inc., Florida Wildlife Federation, and Sierra Club Inc. filed a petition on June 8, 2011, in the United States Court of Appeals, 11th Circuit, in an attempt to set aside BOEMRE’s approval of the plan. The allegations in the petition are relatively general, alleging violation of the National Environmental Policy Act (“NEPA”) (i.e., for BOEMRE’s alleged failure to appropriately conduct the required environmental assessments and/or impact statements) and further alleging elements required pursuant to 43 U.S.C §1349(c) necessary to maintain the suit under the Outer Continental Shelf Lands Act (“OCSLA”).Continue Reading Environmental Groups Attempt to Block Shell Deepwater Gulf of Mexico Drilling

On June 1, 2011, the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) issued a notice to Gulf of Mexico Outer Continental Shelf Region (GOMR) lease and pipeline right-of-way (ROW) holders on reporting hurricane and tropical storm effects. Specifically, the recent notice, designated NTL No. 2011-G01(1), requires four reports, as appropriate:

  • Evacuation

…

On April 28, 2011, Governor Bobby Jindal declared a State of Emergency as a result of growing concern over the predicted crest of the Mississippi River well above flood stage in many areas. Consistent with his authority, on May 13, 2011, James Welsh, Commissioner of Conservation, also issued an emergency and administrative order. It is…

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