Commercial Diver Was A Longshoreman

In an unpublished decision, the Ninth Circuit determined that a commercial diver qualified for coverage under the Longshore and Harbor Workers’ Compensation Act (“LHWCA”).  The Employer argued that the diver should be considered a “member of a crew of [a] vessel,” which would preclude him from LHWCA coverage.  The Ninth Circuit disagreed, and it applied the coverage test established by the Supreme Court in Chandris, Inc. v. Latsis, 515 U.S. 347 (1995).  Under Chandris, a maritime worker who has a substantial connection to a vessel in navigation is excluded from LHWCA coverage.  The “rule of thumb” is that a worker who spends less than thirty percent of his time in the service of a vessel in navigation should not be excluded from the benefits offered by the LHWCA.  Here, substantial evidence supported the ALJ’s finding that the claimant was a longshoreman.

American Marine Corp. v. Director, OWCP, No. 09-73328 (9th Cir. Dec. 20, 2010).

Property Damage Counterclaim Forbidden By Jones Act

The Seventh Circuit Court of Appeals recently ruled on whether a property damage counterclaim in a Jones Act personal injury suit was an impermissible setoff prohibited by the Act.  Section 5 of the Federal Employers’ Liability Act, part of the liability scheme incorporated into the Jones Act, prohibits “any contract, rule, regulation, or device whatsoever, the purpose or intent of which shall be to enable any common carrier to exempt itself from any liability.”  Judge Posner, writing for the court, held that the property damage counterclaim, which had the potential to not only wipe out the plaintiff’s personal injury claim but also to leave the plaintiff owing the vessel owner money damages, was a “device” within the meaning of Section 5 intended to set off the defendants Jones Act liability. Rather than hold that such a counterclaim would always be barred, the court limited its holding to prevent the “one-two punch” sought by the defendant.  Here, defendant sought to recover property damages for its sunken vessel and limit its liability in a limitation action.  Because the vessel was worth a fraction of its price, namely the salvage value of the sunken vessel, the combination of the small limitation fund with the plaintiff’s potential property damage liability to the defendant could setoff any damages recoverable by the plaintiff and actually leave him owing money to the defendant.  Accordingly, the court held that the counterclaim was a liability-exempting device forbidden by the Jones Act.  The court left for another day, “which may be long in coming,” whether such a counterclaim would be barred if the defendant did not seek to limit its liability.

Deering v. National Maintenance & Repair, Inc., — F.3d —, 2010 WL 4907945 (7th Cir. 2010).

Note: This entry was prepared by Trevor Cutaiar, an associate at Mouledoux, Bland, Legrand & Brackett.

“Greater Compensation” and a Higher AWW Calculation

Recently, the Fifth Circuit again addressed Section 28(b) attorneys fees under the Longshore and Harbor Workers Compensation Act.  In Carey v. Ormey Primary Aluminum Corp., an average weekly wage (“AWW”) dispute led to an award of attorneys fees.  The district director determined that the claimant’s AWW was calculated at a rate higher than the employer’s calculations.  The employer voluntarily paid the amount recommended by the district director but also referred the claim to an Administrative Law Judge (“ALJ”) for a formal hearing.  The ALJ calculated the claimant’s AWW as an amount falling between the employer’s calculations and the district director’s calculations.  With respect to Section 28(b) attorneys fees, the employer argued that fees should not shift to the employer because no greater compensation was ever received after the informal conference.  The Fifth Circuit disagreed.

Before attorneys fees shift under Section 28(b), four elements must be satisfied: “(1) an informal conference, (2) a written recommendation for the deputy or Board, (3) the employer’s refusal to adopt the written recommendation, and (4) the employee’s procuring of the services of a lawyer to achieve a greater award than what the employer was willing to pay after the written recommendations.” Va. Int’l Terminals, Inc. v. Edwards, 398 F.3d 313, 318 (4th Cir. 2005); Andrepont v. Murphy Exploration & Prod. Co., 566 F.3d 415, 421 (5th Cir. 2009).

The court noted that while the employer did pay the amount recommended by the district director, it also sought to overturn the recommendation through litigation at a formal hearing. Despite its contentions, the employer’s actions amount to a refusal of the director’s recommendations. Therefore, the third element of a Section 28(b) claim was satisfied.  The crux of the decision, however, depended upon the fourth element: “greater compensation.” Here, the court found that the employee secured greater compensation based upon the fact that the ALJ’s AWW calculation was higher than the employer’s calculation.

Carey v. Ormey Primary Aluminum Corp., — F.3d —- (5th Cir. 2010).

DOL-Joint Bar Association, Inc. Formed

A group of maritime practitioners, both representing injured workers, and employers and insurance carriers, who handle claims before the United States Department of Labor’s Office of Workers’ Compensation Programs, have created the DOL-Joint Bar Association, Inc. These areas of practice include claims arising under the Longshore and Harbor Workers’ Compensation Act and the Defense Base Act. The purposes of the association are to promote and improve the efficient handling of claims and cases administered and adjudicated by the U.S. Department of Labor for all parties involved in those claims, including injured workers, their employers, and insurance carriers; to create an unbiased resource for policy makers and the public on issues of importance related to the representation of individuals and companies involved in claims administered by the U.S. Department of Labor; to defend the honor of the legal profession and promote the highest standards of professional conduct for attorneys practicing before the U.S. Department of Labor, and to provide guidance to the U.S. Department of Labor in administering laws and regulations within its jurisdiction throughout the United States and abroad.

The initial officers of the association are:

David C. Barnett, President
Barnett & Lerner, P.A.
Ft. Lauderdale, FL

Alan G. Brackett, Vice President
Mouledoux, Bland, Legrand & Brackett, LLC
New Orleans, LA

Amie C. Peters, Secretary
Law Office of William D. Hochberg
Edmonds, WA

Roger A. Levy, Treasurer
Laughlin Falbo Levy & Moresi, LLP
San Francisco, CA

If you are interested in the work of the association or becoming a member, please contact us.