Seaman’s Widow’s Claim for Punitive Damages Denied

Recently, the United States District Court for the Eastern District of Louisiana further shored up the clearly delineated avenues for recovery available to plaintiffs involved in Jones Act and personal injury suits arising under general maritime law.  In Wade v. Clemco Industries Inc., et al, No. 16502 (E.D. La. Feb. 2, 2017), the court affirmed the Fifth Circuit’s decision in Scarborough v. Clemco Industries, Inc., and denied the widow of a Jones Act seaman the recovery of punitive damages from non-employer third-parties.

 

Court documents show that the decedent, Garland Wade, worked as a sandblaster and paint sprayer on vessels owned by Coating Specialists, Inc., and performed work on permanent fixed platforms owned and/or operated by Chevron USA both in Louisiana and Federal waters.  Several years after leaving his employment as a sandblaster, the decedent died of connective tissue disease. In the case at bar, it was alleged that the decedent was not provided with a protective hood, not given instructions for the proper use of the hood he may have been given, and that he was not provided with a safe work place.

 

Plaintiff, Rose Wade, initially filed suit on grounds that her husband’s death was caused by products manufactured, marketed, designed, sold, and/or distributed by the defendants, and which contained asbestos which she alleged directly caused or aggravated her husband’s illness and death.  As a result of the defendant’s respective actions and/or inactions, Plaintiff sought $5,000,000.00 in damages for the wrongful death of her husband.

 

Defendant quickly filed motions for partial summary judgment seeking the dismissal of Plaintiff’s claims for non-pecuniary losses, under the well-established rule that Jones Act seamen and their survivors are not entitled to recover non-pecuniary damages from a non-employer third parties. (Scarborough v. Clemco Industries, Inc., 391 F.3d 660, 668 (5th Cir. 2004).)  In conjunction with their efforts, Defendants noted that the Plaintiff in the instant matter had already filed a state court suit in which the decedent had been adjudged to have been a Jones Act seaman, and therefore there could be little question that Scarborough would apply to the claims at issue before the Eastern District.  Defendants also argued that the Supreme Court’s holding in Townsend, which had previously resulted in an award of punitive damages for Employer’s arbitrary withholding of maintenance and cure, did not apply, because the Wade matter did not involve the issues of maintenance and cure.

 

In response, Plaintiff averred that her claims against the non-employer third-parties did not arise under the Jones Act or general maritime law; however, the Court disagreed with this assertion.  In so doing, the Honorable Judge Eldon Fallon found this case to be analogous to McBride v. Estis Well Serv., L.L.C., 768 F.3d 382 (5th Cir. 2014), cert. denied, 135 S. Ct. 2310 (2015), and noted that in that matter, as in the instant case, Plaintiff elected to bring her claim under general maritime law, and thus the parties were to be bound by the limitations on damages previously established under that body of law.  In granting the defendants’ motions in Wade, the court further solidified the foundation laid by McBride and its progeny, in wrongful death cases brought under general maritime law, which continue to limit a survivor’s recovery from employers and non-employers to pecuniary losses in cases where the Jones Act is implicated.

District Court Refuses to Pierce ExxonMobil Corporate Veil in Denying Jones Act Liability

Plaintiff was the widow of Decedent, a German citizen who worked aboard several foreign vessels from December 1973 to December 1978. During this time period, Plaintiff alleged that her husband was exposed to asbestos in the course of his employment as a chief engineer and merchant seaman. Decedent’s employer during that time period was MOSAT, a Liberian corporation. Plaintiff filed a Jones Act claim on behalf of herself and her deceased spouse against twenty-two corporate defendants. One such corporation, ExxonMobil, filed a Motion for Summary Judgment on the grounds that ExxonMobil was neither Decedent’s employer, nor was it the owner of the subject vessels during the relevant time period. Plaintiff alleged that ExxonMobil’s subsidiaries, Mobil Oil and MOSAT, were essentially the same business entity for liability purposes under the Jones Act.

 

The District Court judge looked to several factors to determine whether a parent company so dominates a subsidiary as to warrant disregarding corporate separateness between the two entities. These factors included: (1) disregard of corporate formalities; (2) inadequate capitalization; (3) intermingling of funds; (4) overlap in ownership, officers, directors, and personnel; (5) common office space, address and telephone numbers of corporate entities; (6) the degree of discretion shown by the allegedly dominated corporation; (7) whether the dealings between the entities are at arm’s length; (8) whether the corporations are treated as independent profit centers; (9) payment or guarantee of the corporation’s debts by the dominating entity; (10) intermingling of property between the entities.

 

In granting ExxonMobil’s Motion for Summary Judgment, the District Court held that Plaintiff was only able to establish, at most, two alter ego factors: some interlocking officers and some common office space. The court placed greater weight on the evidence presented by ExxonMobil that the subsidiary company MOSAT had independent responsibility for the company’s international marine transportation. The court also found it significant the fleets were flown under the flags of various different countries.

 

Unterberg v. ExxonMobil Oil Corporation

Fifth Circuit Affirms “Take Nothing” Jury Verdict in Jones Act Suit

Plaintiff filed suit against his Jones Act employer, Cheramie Marine, L.L.C., alleging negligence and seeking maintenance and cure after an alleged injury on one of its utility vessels. Plaintiff alleged that on July 18, 2014, he was injured as a result of the captain’s decision to travel through high seas. Cheramie put on contrary evidence that the waves were not violent and that plaintiff had made contradictory statements that he, in fact, did not fall and that his alleged back pain was the result of being seasick. The captain testified at trial that plaintiff never reported having any kind of accident. Cheramie’s medical expert also offered testimony at trial about two different MRI films taken of plaintiff’s back, one taken prior to his alleged injury and the other taken after the injury. Cheramie’s expert offered his opinion that the pre-injury MRI actually looked worse than the one taken after the alleged accident. After a jury entered a “take nothing” verdict on plaintiff’s claims, plaintiff appealed to the United States Court of Appeals for the Fifth Circuit.

 

Prior to appealing, plaintiff did not file a motion for a judgment as a matter of law or a motion for new trial. Accordingly, on appeal, the Fifth Circuit was limited in what it could review. Review for sufficiency of the evidence was not an option because of plaintiff’s failure to move for judgment as a matter of law or new trial. The only review available was a challenge to the jury instructions. One of the questions on the jury verdict form asked the jury: “(1) Do you find from a preponderance of the evidence that plaintiff had an accident on July 18, 2014?” In response to this question, the jury answered “no.” On appeal, plaintiff argued that the word “accident” was confusing to the jury because, among other reasons, it may have given them the impression that it was something that happened without fault. Applying an abuse of discretion standard in reviewing the challenge to the jury verdict form, the Fifth Circuit found no reversible error in the inquiry as to whether plaintiff had an accident because it fairly presented the issue of liability to the jury.

 

Plaintiff also challenged the trial court’s decision to allow Cheramie’s medical expert to offer an opinion about the pre-incident MRI because the actual film of the MRI was not produced prior to trial. However, the pre-incident MRI was discussed in the expert’s Rule 26 expert report that was disclosed seven months prior to trial and the opinions offered in that report mirrored the testimony offered at trial. The Fifth Circuit concluded that the district court did not err in allowing the expert to testify consistent with his report while not admitting the actual MRI films into evidence.

 
Bosarge v. Cheramie Marine, L.L.C., 2017 WL 105891 (5th Cir. 2017)

Punitive Damages Not Available For Failure To Pay Maintenance & Cure

In a case of first impression, the United States District Court for the Western District of Washington has held that punitive damages for the failure to pay maintenance & cure are not available where seaman’s status is reasonably disputed.

Plaintiff was a pile driver hired to work in the construction of a wharf for the federal government. He was assigned to work in connection with “flexi-floats,” which are used as floating work platforms in maritime construction. He alleged he injured his back in the course of his employment.

Plaintiff sued under the Jones Act and sought punitive damages for the failure to pay maintenance & cure. The employer filed a Motion for Summary Judgment seeking dismissal of the punitive damages claim. Whether Plaintiff was a seaman was disputed and the court previously denied Plaintiff’s Motion for Summary Judgment as to whether he was a seaman. The court held:

“Because reasonable minds could differ on whether Plaintiff’s duties rendered him a seaman, no rational juror could find that Defendants’ opposition to maintenance and cure was in bad faith. Therefore, the Court grants Defendants’ motion for summary judgment and finds that punitive damages are unavailable for Defendants’ allegedly wrongful refusal to pay maintenance and cure.”

Ward v. Ehw Constructors, U.S.D.C. W.D.WA. No. C15-5338