Fighting Liability and Presenting Poor Experts Lead to Unanticipated Expenses

On June 10, 2011, the M/V Salvation, a steel-hulled tug owned and operated by the defendant struck the Ekwata, a vessel that was privately owned by the plaintiff, on the Atchafalaya River.  At the time of the allision, the Ekwata was moored at the fleeting facility.  Prior to the allision, the Salvation’s captain knew that the Atchafalaya River was experiencing historic water levels, which created the potential for extreme cross-currents and required him to exercise extreme caution.  Nonetheless, he proceeded down the river without assistance from another tug, and upon arriving at a holding position in the river, left the controls for a cup of coffee while the on-duty deckhand, who was supposed to be on watch, was below deck.  Before the captain returned to the controls, the river’s current had taken control of the Salvation. After unsuccessfully attempting to regain control, the captain decided to allide with the Ekwata to avoid damaging the two barges in the Salvation’s tow.


Plaintiff filed suit for the resulting damages to the Ekwata in the United States District Court for the Western District of Louisiana invoking the court’s admiralty jurisdiction.  Up to and through trial, the defendant contested liability despite the captain’s admission to his actions and the facts described above. This fight would later prove costly for the defendant.


After bench trial, the district court found the defendant to be at fault and concluded that the Ekwata was a constructive total loss.  The district court awarded the plaintiff $322,890, representing the pre-casualty value of the Ekwata, less the value of the materials and equipment the plaintiff could have preserved following the accident.  The district court also awarded $295,436.09 in attorney’s fees and costs to the plaintiff, finding that the defendant’s handling of the case was “an abuse of the process and bad faith”.


Defendant appealed the matter to the United States Court of Appeals for the Fifth Circuit (“Fifth Circuit”).  Among several assignments of error, the defendant asserted that the district court was erroneous in imposing attorney’s fees as a sanction for its handling of the case.  Defendant urged that it had a good faith basis for questioning the plaintiff’s pre-casualty valuation and thus the district court was not justified in awarding attorney’s fees as a sanction for its handling of the case.  Defendant further argued that the award was excessive.


The Fifth Circuit upheld the district court’s award of attorney’s fees.  It noted the district court’s finding that the defendant contested liability up to and through trial even though it “clearly knew the extent of its liability based on the circumstances of the case and the actions of its captain… [and] was fully aware of the fact that [plaintiff] had no liability whatsoever for this allusion.”  It further noted the district court’s finding that the defendant “presented two experts who were so lacking they could not even properly name the vessel [at issue].”


Defendant urged that the fee award was unwarranted because defendant had a good faith basis to challenge the quantum of damages and proceed with same through trial.  The Fifth Circuit held that even if defendant’s contention was true, it did not justify defendant’s intransigence on liability or the means by which defendant presented its defense on damages.  The Fifth Circuit highlighted defendant’s use of one expert who, according to the district court’s findings, opined on value “without including any comparables, without considering the equipment on the vessel, and without reliable underlying information” and a second expert who, according to the district court, “not only failed to correct the glaringly incorrect information set forth in [the first expert’s] report, but incorporated it into his own.”  The Fifth Circuit affirmed these decisions as well as the award of $295,436.09 in attorney’s fees.


This case illustrates the value the courts place on candidly presenting facts and evaluations of those facts at trial.  While the defendant in this case may have had its reasons to dispute liability, counsel and clients should always work together to analyze their trial strategy and ensure that the fight being fought is not undue.  This can be a hard balance to strike when stepping up to the attorney’s duty of fervently defending his or her client.  The case also illustrates the need for counsel to ensure the competency of the experts they retain.  Here, the defendant’s insistence on fighting liability where the court saw no grounds to do so and the presentation of experts who demonstrated brazen unpreparedness led to costs no one wants to incur.


Moench v. Marquette Transportation

Loyola Holds Day With the DOL Program

Loyola Law School, in cooperation with the United States Department of Labor, will hold its Day With the DOL program on Friday, October 14, 2016 at the Pan-American Life Center, 601 Poydras Street, New Orleans.

Topics include:

Handling Claims Before OWCP
• Administration of Claims and How to Navigate Your Way
• Medical Oversight Within OWCP’s Authority
• Resolution of Disputes

Pain Management and the Opioid Crisis
• What is Medically Necessary and Reasonable
• Guidelines for Pain Management
• Impact on Maximum Medical Improvement and Return to Work

Question and Answer Session with OWCP and OALJ

Speakers include Administrative Law Judge Larry W. Price, District Director David A. Duhon, Dr. Patrick H. Waring, Arthur J. Brewster and Alan G. Brackett. For information and registration, go to:

The Implications of Hanjin’s Bankruptcy

Hanjin Shipping Company originates in South Korea but is internationally recognized in the maritime industry. Responsible for a substantial portion of the industry’s shipping needs, Hanjin is the world’s seventh-largest container shipper. The company is now facing a detrimental dilemma: too many ships and not enough cargo. In order to protect its remaining assets, the company filed for bankruptcy in the United States. So far, eight of Hanjin’s ships have been seized. Approximately 80 more are awaiting their fate and are, in the meantime, preventing approximately $14 billion worth of cargo orders from being delivered. On September 9, 2016, a U.S. judge granted an order allowing Hanjin provisional protection from U.S. creditors, thus enabling some of its vessels to dock and unload.

Despite the court ordered protection, the company’s collapse has already made waves across the board. Retailers are predicting delayed shipments in advance of the holiday season, the impact of which will be felt by the consumer. U.S. exporters are estimating a 50% increase in shipping fees as a direct result of Hanjin’s bankruptcy. Additionally, commentators are noting that the bankruptcy is reflective of an industry-wide problem, citing Maersk Line’s $114 million loss in the first six months of 2016. Though the fate of the company and its vessels is uncertain, we can be sure that all members of the industry will feel the impact, either directly or indirectly.

Ninth Circuit Denies Concurrent Compensation to DBA Claimant

In this claim for benefits brought under the Defense Base Act as an extension of the Longshore & Harbor Workers’ Compensation Act, Claimant alleged that he sustained both a hearing loss injury and a lower back injury caused by a suicide bomber attack while deployed in Iraq. Claimant’s back injury left him permanently and totally disabled. Claimant was adjudicated permanently and totally disabled following a first formal hearing, then a modification hearing brought under Section 22 of the LHWCA.


During the Section 22, modification hearing, Claimant also presented an audiogram that demonstrated binaural hearing loss of 9.7%. However, the presiding administrative law judge held that concurrent payments for hearing loss were unavailable because Claimant was already receiving PTD benefits. The Benefits Review Board affirmed this finding.


Claimant appealed to the U.S. Ninth Circuit Court of Appeals, arguing that he should be awarded concurrent benefits pursuant to Stevedoring Servs. of Am. v. Price, 382 F.3d 878 (9th Cir. 2004). In Price, the Ninth Circuit awarded concurrent benefits to a Claimant who sustained a loss of earning capacity from one accident, and then suffered total disability from a second accident. The Ninth Circuit held in Price that, under those circumstances—where later total disability was based on a wage that had already been decreased because of a prior partial disability—concurrent benefits were merited. Here, Claimant’s two injuries occurred from one accident. The court held that Price was distinguishable, and affirmed its long-standing principle that concurrent benefits were not merited where Claimant sustained both a “scheduled injury” and a permanent and total disability.


Fenske v. Service Employees Int’l