Employer’s Lax Investigation into Crew Member’s Maintenance and Cure Claim Ends up Costing Big

If a seaman becomes ill or is injured while in the service of the vessel, then the shipowner owes the seaman maintenance and cure ­– a contractual form of compensation similar to workers’ comp. The employer’s duty encompasses situations where a seaman has a pre-existing medical condition that becomes manifest while working for the vessel. Importantly, courts are in agreement that any doubts as to a shipowner’s responsibility for maintenance and cure are resolved in favor of the seaman.

The Eastern District of Louisiana’s decision in Jefferson v. Baywater Drilling, LLC reaffirms the notion that courts sitting in admiralty will continue to scrutinize an employer’s denial of maintenance and cure benefits.  In this case, the plaintiff, having been on the defendant’s oil rig for about 11 hours, began experiencing a painful skin condition that produced blisters on his feet. It was later determined that he was suffering from a rare skin disorder where the top layer of skin rapidly dies and begins to shed. Once he alerted his supervisor about his condition, it took an additional five hours for Baywater to transfer Jefferson to shore.

Once Baywater’s claims adjuster arrived at the hospital, he began asking Jefferson non-medical questions, but was eventually asked to leave by one of the nurses who felt the adjuster was harassing Jefferson. The adjuster was unable to get a medical authorization from Jefferson.  Baywater also interviewed witnesses and reviewed reports of the incident. As a result of this investigation, Baywater decided not to pay any maintenance and cure based on its conclusion that Jefferson’s condition had actually manifested prior to his arrival on the rig.

The court considered Baywater’s investigation “impermissibly lax” based in large part on its failure to review any medical opinion or administer any test that supported its theory that Jefferson’s illness had manifested prior to arriving on the rig. In effect, the court found that Baywater made a “medical determination without medical evidence.”  For this reason, the court held that Baywater was arbitrary and capricious in denying maintenance and cure to Jefferson, subjecting Baywater to compensatory and punitive damages, as well as attorney’s fees and pre-judgment interest from the date Jefferson had to leave the rig.

Jefferson v. Baywater Drilling, LLC

Liability for Medical Malpractice

The Court of Appeals for the 11th Circuit (Alabama, Florida and Georgia) has opened the door to a potential flood of liability exposure for vessel operators for negligence of shipboard doctors and other medical personnel.

The 2014 case of Franza v. Royal Caribbean Cruises Ltd. arose out of the injury and death of Pasquale Vaglio, an 82-year-old cruise ship passenger who fell and struck his head while disembarking for a shore side excursion in Bermuda. Immediately after the accident, Vaglio was taken to the medical facilities aboard Royal Caribbean’s Explorer of the Seas for treatment. The ship’s nurse failed to properly assess Vaglio’s condition. When Vaglio was examined further by the ship’s doctor hours later, he was in need of critical emergency treatment for a brain injury.  He was airlifted to a New York hospital and died a week later. Vaglio’s family brought suit against Royal Caribbean, claiming that it was liable for the negligence of its medical personnel.

The suit was initially dismissed by the trial court, based on longstanding precedent that historically protected vessel operators from the negligence of shipboard medical staff. That general exception to a vessel operator’s liability was based on the rationale that the nature of a physician’s specialized skill and training made it unreasonably impractical to fall within the scope of management and/or oversight by the vessel owner/employer.  Other courts had held that vessel operators were incapable of controlling onboard medical personnel because the patient typically determined the nature and extent of the treatment. In breaking from the longstanding law on this issue, the 11th Circuit re-instated the case. Essential to its ruling was what the appellate court noted as a progression of modern technology over the past decades and the expansion of the employment of medical personnel in corporate settings, including the shipping industry. Such developments, in the 11th Circuit’s view, have made it easier for vessel management to oversee and control the medical personnel they employ.   Consequently, the Franza case holds that vessel owners and operators can now be held liable for the medical malpractice of physicians that serve aboard their vessels. Royal Caribbean said it may appeal the ruling.

This article first appeared in Work Boat magazine. It was also posted on March 1, 2015, at Work Boat’s website.

Navigability a Question of Fact for Federal Courts

The United States district courts have original jurisdiction over any civil case of admiralty or maritime jurisdiction.  Admiralty jurisdiction in tort cases requires that the tortious act occurred on the navigable waters of the United States and the tort bears a significant relationship to traditional maritime activity.  The term “navigable waterways of the United States” refers to bodies of water that are navigable in fact.  This includes waters used or capable of being used as waterborne highways for commerce. There has never been any doubt that admiralty jurisdiction extends to the high seas and the territorial seas, but the same may not be said of inland waters.

In March 2010, Larry Boudreaux was conducting commercial crawfishing activities out of a commercial fishing skiff in the Atchafalaya Basin when a Louisiana Department of Wildlife and Fisheries vessel collided with Mr. Boudreaux’s vessel, sending Mr. Boudreaux overboard.  Mr. Boudreaux suffered physical injuries and brought a tort suit in federal court pursuant to admiralty jurisdiction.  The defendant, the Louisiana Department of Wildlife and Fisheries, filed a Motion for Summary Judgment before the United States District Court for the Western District of Louisiana alleging there was no admiralty jurisdiction because the collision did not occur on navigable waters.

The property where the incident occurred presented a genuine dispute of material fact with regard to whether the area was seasonally navigable.  The property flooded occasionally and defendant argued the flooding did not coincide with any particular commercial season, and that the property was usually high and dry, but it just so happened to be flooded on the day the incident occurred.  The plaintiff presented evidence that with the exception of two or three seasons, he had commercially fished for crawfish and catfish in and around the area since 1985 and he was able to access the area on an annual basis, coinciding with commercial crawfishing season, which generally falls between January and July of each year, depending on the relative water levels.  Mr. Boudreaux also submitted the affidavit of another commercial fisherman that stated he personally commercially fished the waters where the incident occurred for years.

The court denied defendant’s Motion for Summary Judgment and held there is no requirement that a body of water be navigable during a particular commercial season in order for admiralty jurisdiction to be found.  It has been held sufficient for a finding of navigability that a particular body of water is “navigable for a significant portion of time” over the years.

 

Boudreaux v. LA Dep’t of Wildlife & Fisheries

Longshore Fraud Nets Prison Time

Mervin J. Noel, 51, of Breaux Bridge, Louisiana, plead guilty to one count of making false statements to continue receiving workers’ compensation benefits under the Longshore and Harbor Workers’ Compensation Act. Noel began receiving longshore benefits and Social Security disability benefits after sustaining an injury while working on an offshore oil platform in 1994. His employer had LHWCA coverage through the Louisiana Workers’ Compensation Corp. (“LWCC”). He also applied for and received SSDI benefits.

In 2007, Noel began operating a lawn care business without disclosing his income to either LWCC or SSA. He completed four separate Forms LS-200, Report of Earnings, at the request of LWCC, falsely stating he had no income. He also falsely reported to SSA that he had not worked for wages since being declared disabled.

Noel received $20,776 in LHWCA benefits and $118,220 in SSDI benefits that he was not entitled to based on his earnings.

U.S. District Judge Elizabeth E. Foote sentenced Noel to six months in prison and six months at-home confinement and ordered Noel to pay $138,247 in restitution to LWCC and the United States.