Fifth Circuit: Who “Invited” Plaintiff on the Vessel?

The U.S. Fifth Circuit Court of Appeals recently addressed competing indemnification provisions in a maritime contract.  A pipeline operator, W&T Offshore, hired a diving contractor, Triton Diving Services, for an offshore pipeline decommissioning project.  Triton provided their own vessel and personnel, but operated under W&T’s instruction pursuant to a Master Service Contract.  W&T also hired a safety contractor, Tiger Safety, to assist with filtration of pipeline fluids.  An employee of Tiger was working on Triton’s vessel under supervision of W&T when he fell and injured himself. 

The Tiger employee sued both W&T and Triton in U.S. District Court.  W&T and Triton filed cross-claims against one another seeking defense and indemnity based on their Master Service Contract.  W&T had agreed to indemnify Triton for personal injury claims brought by members of the “W&T Group”.  Likewise Triton had agreed to indemnify W&T for personal injury claims brought by members of the “contractor group”.  The contract defined the “contractor group” to include Triton’s “invitees on the work sites” and “W&T Group” included W&T’s “invitees on the work sites”.  The indemnification question therefore boiled down to whether the Tiger employee was an “invitee” of W&T or Triton.  At the time of the accident, the Tiger employee was working on Triton’s vessel under the direction of Triton personnel, but he was hired by W&T and was being monitored by a W&T employee also on the vessel. 

The District Court sided with Triton, finding that the plaintiff was W&T’s invitee and W&T appealed to the Fifth Circuit.  On appeal, the Court confirmed that the Master Service Contract was a maritime contract and turned to Fifth Circuit precedent that defined “invitee” as “a person who goes onto premises with the expressed or implied invitation of the occupant, on business of the occupant or for their mutual advantage”.  The Court concluded that even though the plaintiff was injured on Triton’s vessel, he was a W&T invitee because he was hired by W&T and was working under the supervision of W&T.  The Fifth Circuit affirmed the District Court’s finding that W&T owed Triton defense and indemnity. 

Grogan v. W&T Offshore   

5th Circuit Addresses LHWCA’s Last Maritime Employer Doctrine

The U.S. Fifth Circuit Court of Appeals recently addressed the last maritime employer rule under the Longshore and Harbor Workers’ Compensation Act (LHWCA).  The claimant was employed by Ramsay Scarlett & Co. at the Port of Baton Rouge from 1969 – 1991.  From 1991 – 2013, the claimant worked for a second employer, Westway, also at the Port of Baton Rouge.  In 2011, he was diagnosed with asbestosis, which he alleged was caused by exposure to asbestos brake pads and clutches during his employment with Ramsay Scarlett.  The claimant filed a claim for medical benefits against Ramsay Scarlett under the LWHCA.

 

The Administrative Law Judge determined that the claimant established a prima facie claim, which Ramsay Scarlett failed to rebut and that Ramsay Scarlett was the last maritime employer.  Ramsay Scarlett appealed to the Benefits Review Board, which affirmed the ALJ’s decision.

 

On appeal to the Fifth Circuit, Ramsay Scarlett argued that even if the claimant established a prima facie claim by virtue of his deposition testimony and the report of an industrial hygienist, it was not the last maritime employer.  Ramsay Scarlett argued that the claimant testified he also worked around cranes, trucks, and equipment that could have exposed him to asbestos while employed by Westway.  The Fifth Circuit held that because the claimant did not testify about asbestos exposure at Westway and Ramsay Scarlett failed to provide any contradictory evidence, there was not “substantial evidence” sufficient to rebut the claimant’s claim and establish Westway as the last responsible employer.  The Fifth Circuit affirmed the ALJ’s finding that Ramsay Scarlett was the last maritime employer and was responsible for all medical benefits related to the disease.

 

Ramsay Scarlett & Co. v. Director, OWCP

Dropping Anchor Does Not Trigger a Requirement to Provide Notice Under La. RS § 40:1749.11 for Dredge Owner

A dredge, seeking to secure position for anchoring, lowered its dredge ladder and cutter head into the seabed, striking a pipeline. The pipeline owner sued the owner of the dredge claiming, among other things, the dredge owner acted negligently in failing to discharge its notification responsibilities under the Louisiana Underground Utilities and Facilities Protection Law, La. Rev. Stat. Ann. § 40:1749.11 et seq. (referred to as “the One–Call Statute”), before engaging in the anchoring procedure.

 

The pipeline owner moved for partial summary judgment seeking a ruling that the dredge owner and operator had engaged in “excavation” and was therefore required to provide advance notice under the One-Call Statute. The district court denied the motion, and the pipeline owner appealed to the U.S. Fifth Circuit. Because it is “excavation” that triggers the notification requirement in the statute, the critical question is whether the dredge owner’s anchoring procedure constitutes “excavation.”

 
The pipeline owner argued that the dredge owner’s anchoring activity was an “operation for the purpose of movement … of earth,” and thus constitutes “excavation” under § 1749.12(6)’s general definition of the term. Specifically, the pipeline argued that the dredge owner’s activity had “the purpose of” moving earth because, “to accomplish” the objective of stopping the movement of the dredge, “the cutter head would have to dig into the seabed and displace the earth.”

 
The Court held that under the rule of lenity, Louisiana courts resolve ambiguities in the “penal” statute, such as the one at issue in this matter, in favor of the defendants. As such, the Court was required to adopt a narrow reading of “purpose”. The Court also distinguished between “knowledge” of the operation “moving the earth” and “purpose” of the operation “moving the earth.”

 
The Court found that anchoring did not have the “purpose” of moving the earth, and the district court’s ruling denying the pipeline company’s motion was affirmed.

 
Plains Pipeline, L.P. v. Great Lakes Dredge & Dock Co.

Rig Owner Not Liable for Failing to Search for Lost and Submerged Rig

A tanker vessel allided with an unmarked and submerged wreck of a jack-up drilling rig that was lost during Hurricane Ike. In the aftermath of the hurricane, the jack-up drilling rig owner discovered that the rig was no longer moored in the Gulf of Mexico. The rig owner timely searched for the rig using aerial searches of the Gulf of Mexico and subsea sonar searches within the estimated drift path of the rig. These search efforts proved unsuccessful, and the jack-up drilling rig owner concluded its search. Later evidence showed that within ten hours of Hurricane Ike’s passage, the jack-up drilling rig traveled 100.9 miles west-northwest, capsized, and came to rest in 115 feet of water in the South Sabine Point Lightering Area, approximately 65 miles south of Galveston, Texas. The tanker vessel allided with the wreck at this location approximately six months later, causing substantial damage.

 
The tanker owner asserted that the jack-up drilling rig owner was liable under 33 U.S.C. § 409 for failure to mark the wreck. The case proceeded to a bench trial. After all parties put on the majority of their evidence and the tanker owner rested its case, the district court granted the rig owner’s motion for judgment, finding it had conducted a full, diligent, and good-faith search for jack-up drilling rig, but was unable to find it. The tanker owner appealed to the U.S. Fifth Circuit.

 
The tanker owner’s primary argument was that the district court applied an incorrect legal standard in making its factual finding that the jack-up drilling rig owner conducted a full, good-faith search. The tanker owner argued that the district court should have placed greater weight on the fact that the drilling rig owner did not search in the area where jack-up drilling rig ultimately rested, because that was an area where the wrecked rig would constitute a hazard to navigation.

 
The Court found no reversible error based on the evidence presented at trial, that the search the jack-up drilling rig owner did conduct was full, diligent, and in good faith, even though the jack-up drilling rig owner did not search the area 100 miles away considered a hazard to navigation.

 
ENSCO Offshore Co v. M/V SATILLA