A Maritime, Longshore and Defense Base Act Blog

Archive for the ‘Jones Act’ Category

In a recent unpublished decision, the United States Fifth Circuit Court of Appeals explained the nature of its review of the denial of a motion for new trial.  The plaintiff in the underlying case was injured while working on a commercial fishing vessel.  He filed a Jones Act negligence and unseaworthiness claim against his employer.  After a three-day jury trial, a unanimous verdict was returned in favor the employer.  The district court subsequently denied the plaintiff’s motion for new trial, finding the verdict was not against the great weight of the evidence.  The plaintiff appealed the district court’s denial of his motion for new trial.

On appeal, the Fifth Circuit noted several pieces of evidence in the record to support the jury’s verdict.  For example, the vessel’s captain testified that the plaintiff had violated company policy by attempting to moor the vessel while it was still moving.  The captain also testified that immediately following the accident, the plaintiff had remarked that it was a result of his own “dumb, stupid mistake.”  Further, the plaintiff had given a statement that the accident was not caused by an unseaworthy condition of the vessel.

The court commented in a footnote that the plaintiff seemed to concede that there was evidence to support the verdict.  However, the plaintiff argued that the evidence was not credible and should be disregarded.  The court took this argument as an indication that the plaintiff misunderstood the nature of its review.  The court explained that it was bound to accept the evidence in support of the verdict as true and that its task was to decide whether there is an “absolute absence” of evidence, not second guess the credibility determinations of the jury.  The Fifth Circuit affirmed the district court’s denial of plaintiff’s motion for new trial.

The United States Court of Appeals, Fifth Circuit, issued an opinion discussing whether cure awarded in a Jones Act claim should include the amount medical providers charged or the amount they accepted as full payment from a plaintiff’s insurer.

In November 2006, Leon Manderson began working as a licensed engineer for Chet Morrison Contractors, Inc. (CMC) aboard a dive vessel operating in the Gulf of Mexico.  In January 2008, Manderson, aboard another CMC dive vessel, left abruptly and was hospitalized, receiving treatment for ulcerative colitis, diabetes, and a liver condition.  Manderson did not return to work. 

The United States District Court for the Western District of Louisiana awarded Manderson maintenance and cure and attorney’s fees incurred in obtaining that relief.  The court subsequently ruled CMC liable for $14,680.00 for maintenance and $169,691.06 for cure. 

On appeal, CMC challenged the district court’s application of the collateral-source rule for determining the amount of cure awarded Manderson.  In an issue of first impression, CMC contended that the cure award should not have included the difference between the amount of Manderson’s medical providers charged and the lesser amount they accepted from his insurer as full payment.  The Fifth Circuit applied a de novo review.   

Cure is the shipowner’s obligation to pay necessary medical services for seamen injured while in its service.  This obligation is an implied term of a maritime-employment contract and does not depend on any determination of fault. 

The collateral-source rule is a substantive rule of law that bars a tortfeasor from reducing the quantum of damages owed to a plaintiff by the amount of recovery the plaintiff receives from other sources of compensation that are independent of the tortfeasor.  Generally, in tort actions, the collateral-source rule prohibits a reduction of compensatory damages by the difference between the amount billed for medical services and the amount paid.  Yet, as previously mentioned, maintenance and cure is an implied term of contract for maritime employment and is not predicated on the fault or negligence of the shipowner.  Accordingly, because of the unique nature of maintenance and cure, normal rules of damages, such as the collateral-source rule in tort, are not strictly applied. 

Nevertheless, the Fifth Circuit has identified an exception to this general rule:  Where a seaman has alone purchased medical insurance, the shipowner is not entitled to a set-off from the maintenance and cure obligation moneys the seaman receives from his insurer.

Having found Manderson purchased his own medical insurance, the court¾consistent with the Fifth Circuit precedent¾made no deduction from the cure award for payments by Manderson’s insurer.  In doing so, the court found the amount of cure was the greater amount charged by Manderson’s health-care providers.  CMC contended that the appropriate amount for cure was the lesser amount those providers accepted as full payment from Manderson’s insurer, and the Fifth Circuit agreed.   

An injured seaman may recover maintenance and cure only for those expenses actually incurred.  The relevant amount is that needed to satisfy the seaman’s medical charges.  The Fifth Circuit stated, “This applies whether the charges are incurred by a seaman’s insurer on his behalf and then paid at a written-down rate, or incurred and then paid by the seaman himself, including at a non-discounted rate.”  Regardless of what Manderson’s medical providers charged, those charges were satisfied by the much lower amount paid by his insurer.  Consequently, the district court erred by awarding the higher charged (but not totally paid) amount. 

Though Manderson’s payment of health-insurance premiums benefitted CMC, this benefit was not a problem here, where fault was not an issue and CMC was liable only for maintenance and cure.  By using the amount paid by Manderson’s health insurer, rather than the amount charged, the Fifth Circuit held Manderson entitled to recover $71,085.79 for cure, resulting in a difference of $98,605.27.

Manderson v. Chet Morrison Contractors, Inc., — F.3d —, 2012 WL 10541 (5th Cir. 01/03/12).

Plaintiff injured his arm while working at the Employer’s “Docksider” facility.  The Docksider was constructed as a deck barge in 1972.  Twenty-seven years later it was converted to a stationary floating transfer facility.  It receives electricity from a generator on shore.  Further, the Docksider is held in place by two welded I-beam brackets.  It can move vertically to account for the tide and waves, but it cannot transport people or materials.  Following his injury, Plaintiff instituted an action against the Employerunder the Jones Act, 42 U.S.C. § 30104, and the Longshore and Harbor Workers’ Compensation Act (“LHWCA”), 33 U.S.C. § 905(b).

The Eastern District of Louisiana dismissed Plaintiff’s claims with prejudice.  It determined that the Docksider was not a “vessel” under the Jones Act or the LHWCA.  The Docksider’s use for transportation on water was only theoretical.  Since 1999, the Docksider has been permanently moored.  Considering the fact that Employer does not plan to move the Docksider, that it gets electricity from an on-shore generator, and that it would require an eight-man crew a full day to remove the Docksider from its moored position, the Docksider is not considered a “vessel.”

Poolson v. Malley Repairs, Inc., No. 09-7105, 2011 WL 6000873, slip op. (E.D. La. Nov. 30, 2011).

Plaintiff, a Jones Act seaman, instituted a maritime action against his employer to recover for injuries sustained when a skiff he was piloting allided with a bridge.  Additionally, Plaintiff argued that he should recover for the allegedly negligent medical treatment he received immediately after the crash.  The United States Court of Appeals for the Fourth Circuit ultimately agreed with the district court’s decision to dismiss Plaintiff’s Jones Act negligence and unseaworthiness claims.

Further, the Fourth Circuit agreed that Plaintiff’s employer was not liable for the allegedly negligent medical treatment Plaintiff received after his accident.  To be certain, a shipowner can become vicariously liable for a seaman’s injuries when the shipowner selects a doctor who acts negligently. A shipowner’s vicarious liability is based upon the level of control the owner had when selecting the physician.  Where a ship carries an on-board physician employed by the ship, vicarious liability attaches to the shipowner for the physician’s negligence.  Vicarious liability can also attach when the shipowner engages the services of on-shore physicians.  Liability does not attach, however, when the seaman selects his own physician.  Further, when a shipowner merely refers the seaman to a negligent physician, vicarious liability may not attach because of the lack of an agency-based relationship.  Here, Claimant’s physicians were emergency physicians who responded to a 911 call.

Plaintiff made an interesting argument trying to link the 911 call to vicarious liability.  He argued that the employer “constructively selected [the allegedly negligent physicians] by instituting a written emergency response policy that instructs the employees to ‘call 911 first.’”  The Fourth Circuit stated that, while “it is a close question, we conclude that the existence of the ‘call 911 first’ policy alone is insufficient as a matter of law to determine that [the employer] selected or otherwise engaged [the allegedly negligent physicians]….”  Instead, the ‘call 911 first’ policy was “the equivalent of providing each employee with a list of every medical provider in the region,” as opposed to identifying a physician employed, selected or engaged by the employer.

Dise v. Express Marine, Inc., No. 10-1721, 2011 WL 5588913 (4th Cir. Nov. 17, 2011) (unpublished).

A seaman brought suit against his employer, seeking $1 million in damages for reduced earning capacity and $250,000.00 for past and future maintenance and cure.  Plaintiff claimed that in May, 2005 he sustained injury to his back as a result of the employer’s negligence while performing anchor maintenance aboard his vessel.

When the employee reported his alleged injury to his low back, his employer began maintenance and cure payments.  (Maintenance, a daily living allowance and cure, payment for medical treatment the employer is obligated to pay the ill or injured seaman).  By the time the seaman filed his lawsuit in Federal Court in New Orleans, his employer had paid a total of $276,263.36. 

Through discovery, it was established that the seaman intentionally concealed from his employer at the time of his post-hire medical interview significant back injuries, including treatment for back pain in 1997, 1998 and 2000.  He also concealed an MRI conducted on October 24, 2004, revealing an annular disc fissure at L4-5 and disc protrusion at L5-S1 with neural impingement; and a 50-pound lifting restriction from the physician who performed a prior pre-employment physical for Diamond Offshore, a prior employer.

After it discovered that the seaman had concealed his true history of longstanding and well documented low back problems, the employer took two actions.  First, it moved for partial summary judgment to dismiss the seaman’s maintenance and cure claims, pursuant to the precedent set by McCorpen v. Central Gulf S.S. Corp., 396 F.2d 547 (5^th Cir. 1968), (under McCorpen, a Jones Act employer is not bound to make maintenance and cure payments if the employee intentionally withheld pre-existing health conditions material to the employer’s decision to hire him and there is a connection between the withheld pre-existing condition and the injury complained of in the lawsuit.)

The seaman, realizing that the evidence of his deception was indisputable, sought to dismiss his maintenance and cure claim.  Judge Ivan Lemelle, however, granted the motion and dismissed the seaman’s maintenance and cure claim.

The employer then filed a Counterclaim against the seaman seeking restitution of the maintenance and cure payments and brought a motion seeking declaration that it was legally entitled to said restitution.

Judge Lemelle recognized this was an issue that the courts had not previously addressed.  However, the employer contended that the seaman who receives benefits by fraudulently concealing his true medical condition has been unjustly enriched and that restitution is the appropriate remedy.  The employer also relied on Louisiana law principals of unjust enrichment and workers’ compensation laws that allow for restitution based on the employee’s fraud.  The seaman countered saying that the general maritime law does not provide for this remedy, and that the Louisiana Fourth Circuit Court of Appeal had previously rejected such a claim in its 2010 opinion in Cotton v. Delta Queen Steamboat Company.

After a comprehensive analysis of decisions of other courts and various compensation schemes from across the nation, Judge Lemelle concluded that restitution was proper.  He noted, “the facts of this case are unique because the seamen not only failed to disclose his condition during the initial stages of employment, but he also concealed it by failing to timely disclose it to his employer and his own attorney until years later, and then only on the eve of the ruling on the McCorpen issue.  This seaman’s inactions were more than unreasonable; they were intentionally done and void of good faith.”

Significantly, the judge noted that the employer would have a right of credit for its maintenance and cure payments against any judgment it may pay with respect to the seaman’s still viable Jones Act negligence and unseaworthiness claims.

This is an important decision about which maritime employers should be aware.  It recognized the right to restitution and the right of the employer to credit against any adverse judgment on the negligence/unseaworthiness dispute, as the seaman will likely not have the resources to make restitution himself.  See, Boudreaux v. Transocean Deepwater, Inc., 2011 WL 5025268 (E.D. La.).

It should also be noted that this is one of several recent decisions from the U.S. District Judges in New Orleans in which seaman’s claims for maintenance and cure have been dismissed.  If there is clear evidence of fraud or misconduct, the Judges will provide relief to the employer.

Via a contract with a staffing company, Claimant became employed by a catering company, and was assigned to work as a part of the galley/cooking staff.  Claimant alleged that he was injured aboard a vessel while working for the catering company, and he filed Jones Act negligence claims against both parties and their insurers.  Subsequently, insurance and indemnification disputes developed between the defendants and their insurers, which were rooted in the issue of whether Claimant was a Jones Act seaman.  The trial court, ruling on motions and cross-motions for summary judgment, found that Claimant was a Jones Act seaman, and concluded that the Longshore and Harbor Workers’ Compensation Act was inapplicable; therefore, the catering company was required to defend and indemnify the staffing company.  The defendants later settled with Claimant, and a Joint Motion and Order of Dismissal was granted.  Appellants now argued that the trial court erred in granting the motions for summary judgment on the issues of Jones Act seaman status, indemnity and defense against the catering company.

The court looked to the Chandris test for seaman status, which asks 1) whether the employee’s duties contributed to the function of the vessel or accomplishment of its mission; and 2) whether that employee had a connection to a vessel in navigation which was substantial both in terms of duration and nature.  Chandris, Inc.  v. Lastis, 515 U.S. 347, 368 (1995).  The parties did not dispute the first element, as Claimant was employed as a cook on a quarters barge, and was also responsible for cleaning the barge.

Appellants challenged Claimant’s connection to the vessel, arguing that because Claimant was randomly assigned to work for various customers, he did not have an employment connection to a particular vessel or fleet of vessels under common ownership.  They further maintained that while some of claimant’s assignments were to vessels, some were to fixed platforms.  The court noted that under Parker v. Jackup Boat Service, LLC, 542 F.Supp.2d 481 (E.D. La. 2008), “merely being ‘subject to reassignment [to a non-seaman role or status] … at some point later in time is of no moment’ and does not in itself defeat a worker’s seaman status.”  Id. at *4.  Further, seaman status cannot be denied due to the nature of third-party contracting for a vessel’s operation or the manner in which work is assigned by a third party.  Bertrand v. Int’l Moring & Marine, Inc., 700 F.2d 240 (5^th Cir. 1983). 

Here, the court ruled that summary judgment on seaman status should not have been granted due to conflicting evidence on the connection issue, including the fact that the president of the catering company testified that Claimant worked for defendant for 153 days at seven different job sites, and worked with five of the company’s customers.  Further, Claimant could not recall where most of his assignments took place, but they included a mix of dive boats, drilling ships, and platforms.  An employee of the staffing company, however, testified that Claimant was assigned to a vessel or identifiable fleet of vessels.  The court also found there were genuine issues of material fact regarding satisfaction of the duration element, because of similar discrepancies in the testimony with regard to where and how Claimant spent his time while employed by the catering company.

Becnel v. Chet Morrison, Inc., No. 2010-CA-1411 (La. App. 4 Cir. 8/31/11); — So. 3d —-, 2011 WL 3853115.

In an opinion that is interpretive of the landmark decision in Atlantic Sounding Co., Inc. v. Townsend, 129 S.Ct. 2561 (2009), U.S. District Judge Pechman denied defendant’s 12(b)(6) motion to dismiss by holding that the spouse of an injured seaman may seek damages for loss of consortium under general maritime law. 

Loss of society damages were deemed to be unavailable to survivors of seamen who brought claims under the Jones Act or under general maritime law under Miles v. Apex Marine Corp., 498 U.S. 19 (1990).  The Miles Court based its holding on the U.S. Supreme Court decision in Michigan Central Railroad Co. v. Vreeland, 227 U.S. 59 (1913), which held that loss of society damages were not available under the Federal Employers Liability Act (“FELA”).  The Miles Court reasoned that the Jones Act, which incorporated the FELA, required the application of the Vreeland decision as judicial “gloss.”  Id. at 32.  The Miles Court then reasoned that because loss of society damages were not available in a Jones Act wrongful death claim for negligence, such damages were not available in a general maritime law wrongful death action for unseaworthiness because, “[i]t would be inconsistent with our place in the constitutional scheme were we to sanction more expansive remedies in a judicially created cause of action in which liability is without fault than Congress has allowed in cases of death resulting from negligence.” Id. at 32-33.

Subsequent to the decision in Miles, courts began using its premise as a basis for denying all punitive damages to seamen.  See David W. Robertson, Punitive Damages in U.S. Maritime Law: Miles, Baker, and Townsend, 70 La. L. Rev. 463, 466-67 (2010).  Then, in Townsend, the Supreme Court held that seamen could sue employers for punitive damages for willful and wanton failure to pay maintenance and cure under general maritime law, stating “[t]he Jones Act . . . created a statutory cause of action for negligence, but it did not eliminate pre-existing remedies available to seamen for the separate common-law cause of action based on a seaman’s right to maintenance and cure. . . punitive damage awards, in particular, remain available in maintenance and cure actions after the [Jones] Act’s passage.”  Townsend, 129 S.Ct. 2561, 2571-72.

The Court’s Townsend decision left many questions unanswered.  The Court did not explicitly overrule Miles, or decree that loss of consortium was available as a result of a claim for injury or death due to unseaworthiness under the general maritime law.  In Barrette, Judge Pechman opined that the correct reading of Townsend is that a seaman’s recovery under the general maritime law is not limited to those damages available under the Jones Act, and that because the cause of action for unseaworthiness and the remedy of loss of consortium existed in maritime law prior to the enactment of the Jones Act, “the Jones Act does not preclude recovery for loss of consortium in an unseaworthiness action.”  Barrette at *4.

Barrette v. Jubilee Fisheries, Inc., No. C10-01206MJP, 2011 WL 3516061 (W.D. Wash. Aug. 11, 2011). 

In the maritime work force, workers fall generally into two groups.  There are those who work aboard vessels and in the eyes of the law would be considered seaman.  And, there are those who are engaged in some aspect of maritime commerce earning their living on the navigable waters and adjacent facilities, but who are not assigned to a specific vessel or fleet of vessels.  These workers may be, for instance, longshoremen, ship repairmen or fabricators.

What both groups have in common is that if injured on the job their employers may have a non-delegable, no fault duty to pay compensation and medical expenses to, and on behalf of the injured worker.

The maritime law which protects the rights of the injured seaman, and the federal and state workers’ compensation statutes which provide for the injured land based maritime worker, are all interpreted by the courts in a liberal manner, favoring the injured employee.  As a result, if one of its employees claims job related illness or injury, the employer will be responsible for compensation benefits to the land based worker, maintenance (a daily living allowance) to the seaman, and costs of medical treatment until the employee is discharged by his physicians.  Fault or negligence of the employer in causing the illness or injury pays no role in assigning these duties.  Given the rising costs of medical services and insurance, the employer has substantial financial exposure.

However, there are defenses of which a diligent employer can avail itself.  The “front-line” defenses are a comprehensive written employment application and a thorough and detailed written pre-employment physical questionnaire, both of which the applicant should be required to personally fill out and sign with the express written understanding that everything stated is true.

In the case of the seaman, the employer may be able to escape financial responsibility if it can prove that the seaman intentionally misrepresented, lied about or concealed a pre-existing medical condition, that the pre-existing condition is the same as, or substantially the same as the condition, and that had it known of the pre-existing condition the claimant would never have been hired.  McCorpen v. Cent. Gulf S.S. Corp., 396 F.2d 547 (5^th Cir. 1968).

While it may be more time consuming and expensive, thorough screening at these stages in the employment process will save money down the road.  One claim has the potential of dramatically affecting the bottom line of any company, particularly those who are self-insured or carry high deductibles.  By requiring the applicant to fill out applications and detailed pre-employment physical history questionnaires, the employer will have documentation that should be preserved and can be used as evidence should a questionable claim be filed and litigation ensue. 

A pro se plaintiff filed a Jones Act suit against Defendants, Dyncorp International and DynMarine Services of Virginia, complaining of post-traumatic stress disorder (“PTSD”) stemming from a sexual assault that allegedly occurred over 10 years before she filed her complaint.  Plaintiff’s hand-written complaint contained no factual or legal allegations other than two phrases: “Post Traumatic Stress Disorder (sexual assault)” and a demand of “Amount Undecided” for “lost wages, pain & suffering.”  In response to Plaintiff’s suit, Defendants filed motions for summary judgment arguing inter alia that her Jones Act claim was time-barred. 

A claim under the Jones Act must be brought within three years after the cause of action arises.   A cause of action under the Jones Act and general maritime law accrues when a plaintiff has had a reasonable opportunity to discover the injury, its cause, and the link between the two.  The discovery rule applies such that the statute of limitations is not meant to apply to facts that were “unknown and inherently unknowable” to the plaintiff.  The law in the Fifth Circuit recognizes potential application of the discovery rule in both pure latent injury cases and traumatic event/latent manifestation cases.  Occupational exposure cases present the most common example of a pure latent injury case.  In this type of case the plaintiff does not know that he has sustained an injury until years later when the disease finally manifests itself.  The discovery rule may operate in such a case because the plaintiff should not be victimized if he has no knowledge that he was injured.  Traumatic event/latent manifestation cases are different because the plaintiff sustains both immediate and latent injuries caused by a noticeable, traumatic, occurrence.  At the time of the traumatic event, the plaintiff realizes both that he is injured and what is responsible for causing the injury.  The full extent of the harm, however, has not become manifest.

Here, the plaintiff last worked for Dyn Marine in May of 1999.  That means that plaintiff’s claim, on its face, would be time-barred, unless the discovery rule applied to her claim.  The only potential application of the discovery rule was the traumatic event/latent manifestation scenario.  The court stated that it was “beyond cavil that a victim of a sexual assault knows that she has received an injury as a result of that tortious act upon its occurrence albeit the full extent of the harm may not have become immediately manifest.”  Although the date of diagnosis was not known, the court noted that Plaintiff, for purposes of entering into a settlement in a separate discrimination suit, stated she was taking PTSD medication in 2002.   Finally, the court determined that even if it credited Plaintiff’s assertion that the cause of her PTSD only became known in 2009, she still failed to create a issue of fact as to the timeliness of her claim.  Her response to the summary judgment motionwas “three sentences long and completely unresponsive to the potentially dispositive issues raised via Defendants’ motion.”

Payton v. Dyncorp International, No. 10-1014, 2011 WL 2669254 (E. D. La. July 7, 2011).

In her recent opinion in Richardson v. Kerr-McGee Oil & Gas Corp., et al., District Judge Helen Berrigan addressed whether the Fifth Circuit’s decision in Fields v. Pool Offshore, Inc., 182 F.2d 353 (5th Cir. 1999) was still good law in light of the United States Supreme Court’s decision in Stewart v. Dutra Construction Co., 543 U.S. 481 (2005).

The question arose in the context of a Jones Act personal injury claim.  On February 20, 2006, Riley Richardson fell while performing maintenance work a Nansen Spar, a buoyant petroleum extraction platform positioned 150 miles south of Houston, Texas.  The spar was moored to the sea floor by 230 feet of cables and pilings.  Tightening and slackening of these cables allowed the spar to be maneuvered within a 250-foot range.  Richardson sought to recovery for his injuries under the Jones Act.

The defendants moved for summary judgment, arguing that the Nansen Spar was not a “vessel” for purposes of the Jones Act.  The court noted that the Fifth Circuit has clearly stated that “spars are not vessels but rather are work-platforms.”  Fields, 182 F.3d at 358.  They are not vessels because (1) they are designed to work in a fixed area for the foreseeable future; (2) the way they are secured to the sea floor renders any movement outside the 250-foot range difficult and expensive; and (3) when moored in place, they have limited mobility that is consistent with work platform status.

Notwithstanding this guidance, Richardson argued that the Supreme Court’s decision in Stewart v. Dutra Construction Co. overturned Fields.  In Stewart, the Court held that a dredge in the Boston Harbor was a vessel even though, at the time the plaintiff was injured, it could only move itself by manipulating its anchors and tow cables.  The Court reasoned that the barge was a vessel because it “was not only capable of being used to transport equipment and workers over water—it was used to transport those things.”  543 U.S. at 495. 

Judge Berrigan noted that although the Fifth Circuit recognized Stewart’s broadening of the class of unconventional watercraft that meet the definition of a vessel, the Fifth Circuit had never directly addressed Stewart’s impact of Fields.  Judge Berrigan ultimately concluded that Fields was consistent with Stewart and remained good law.  The spar at issue had been permanently moored to the ocean floor and did not satisfy Stewart’s requirement that it be capable of maritime transport in a meaningful way.  Based on that determination, the defendants’ motions for summary judgment were granted and Richardson’s Jones Act claims were dismissed.

Richardson v. Kerr-McGee Oil & Gas Corp., et al., 2011 WL 2565315 (E.D. La. June 28, 2011).