11th Circuit Denies Arguments Against Jones Act Arbitration and Removal

The Eleventh Circuit issued an unpublished Jones Act decision discussing–albeit briefly–removal and arbitration.  Plaintiff argued against removal and arbitration.  The Eleventh Circuit disagreed, saying:

Trifinov also contends that his Jones Act claim cannot, as a matter of law, be removed to federal court.  We accept that Jones Act claims are not generally subject to removal.  But that Jones Act claims may be subjected to arbitration under the [United Nations Convention on Recognition and Enforcement of Foreign Arbitral Awards] is clear.  And the Convention authorizes the removal to federal court of claims “relat[ing] to an arbitration agreement or award falling under the Convention.”

Although we have not addressed the removal issue expressly, this Court has routinely compelled arbitration of Jones Act claims that have been removed under 9 U.S.C. § 205 when they relate to an arbitration agreement under the Convention.  And the few other courts that have decided the issue have concluded that removal of Jones Act claims is proper under the Convention.  We are persuaded that Trifinov’s Jones Act claim, which is governed by the Convention, was removed properly to federal court.

Trifinov v. MSC Mediterranean Shipping Co. SA, — F.A’ppx —- (11th Cir. 10/21/14).

Trial Court Disbelieved Plaintiff, Determined He Was Not a Seaman

Last week, Louisiana’s Third Circuit published a Jones Act decision wherein it affirmed the lower court’s decision that Plaintiff failed to carry his burden of proof that he was a Jones Act seaman.  Plaintiff began working for his employer in a land-based warehouse, but he expressed interest in offshore work.  Soon thereafter, Plaintiff began working as a helper on a platform fixed to the outer continental shelf; but he ate, slept, and used the restroom facilities on a vessel called the RAM VII.  Plaintiff was injured when a Teflon pipe weighing two-and-a-half pounds struck him in the face.  Plaintiff then filed a petition for damages wherein he alleged entitlement to compensation based on his status as a seaman under the Jones Act.  The trial court disagreed.

On appeal, Louisiana’s Third Circuit discussed Chandris, and the Supreme Court’s test for seaman status.  Essentially, Plaintiff complained that the “trial court incorrectly based its finding that he failed to carry his burden to prove that he was a Jones Act seaman solely based upon how much time he physically spent on a vessel.”  The appellate court disagreed:

Our review of the record does not indicate that the trial court found [Plaintiff] was not a seaman based solely because he was not working on the RAM VII 50% of the time.  Rather, it is clear that the trial court determined that [Plaintiff] was not credible and, as such, it did not give credence to his assertion that he spent 50% of his time working on the RAM VII.  The trial court then cited testimony contrary to [Plaintiff's] assertion that he spent 50% of his time physically on the RAM VII.

In essence, the trial court did not believe Plaintiff’s allegations that he spent 50% of his time on a vessel.  Because the Supreme Court’s Chandris test requires consideration of the amount of time a seaman is on a vessel, Plaintiff’s lack of credibility was fatal to his claim.

But that’s not all.  The appellate court also discussed the evidence that refuted Plaintiff’s claims that he was a seaman.  The court cited testimony of a former employee, a present employee, and the employer’s safety manager.  The testimony refuted Plaintiff’s allegations that he worked 50% of the time on the RAM VII.  Indeed, “[t]he summation of the witness testimony can reasonably be interpreted that [Plaintiff's] connection to the RAM VII was tenuous and, therefore, not substantial in duration or nature as required by the second prong of the Chandris test.”  Accordingly, Plaintiff was not a seaman and the trial court did not err.

Troglen v. Hydraulic Well Control, 2014-308 (La. App. 3 Cir. 10/8/14); — So. 3d —-.

The Supreme Court Denied Review in Dize and Other Maritime Cases

The Supreme Court is back in session.  On October 6, 2014, the Court issued its Orders list, wherein a large number of cases were denied certiorari.  Accordingly, the Court will not review:

Dize v. Association of Maryland Pilots.  The question presented in Dize was whether, when applying the Chandris, Inc. v. Latsis thirty-percent rule–that, ordinarily, a qualifying “seaman” under the Jones Act must spend thirty percent or more of his time in service of a vessel in navigation–a court may consider the time a maritime worker spends in the service of a vessel in navigation that is moored, dockside, or ashore, as the Third, Fifth, Sixth, and Ninth Circuits have held, or whether a court must categorically exclude such time, as the Eleventh Circuit and the Maryland Court of Appeals have held.

Gonzalvez v. Celebrity Cruises, Inc.  The petitioners asked the Court to consider whether seamen are statutorily exempt from the 3-month limitations period under Chapter 1 of the Federal Arbitration Act.  This case arose from dispute about sharing gratuities under the Seaman’s Wage Act.  This link will take you to Lisa Schaeffer’s Lexis article “U.S. Supreme Court Denies Cert for Celebrity Cruise Line Workers.”

Downer v. Royal Caribbean Cruises, Ltd.  This case asked inter alia whether the Eleventh Circuit’s decision compelling arbitration for seafarers’ claims against a cruise line, under foreign law, deprives them of their American statutory rights in violation of the “effective vindication doctrine.”

Lyles v. Seacor Marine.  In Lyles, the plaintiff lost a Jones Act and maintenance and cure claim nearly ten years before trying to reassert his claims.  The Fifth Circuit denied the plaintiff’s claims and also admonished the plaintiff, writing that “future frivolous, repetitive, or otherwise abusive filings may result in the imposition of sanctions, including dismissal, monetary sanctions, and restrictions on his ability to file pleadings in this court or any court subject to [Fifth Circuit] jurisdiction.”

Historical Background Anchors Judge Clement’s McBride Concurrence

On September 25, 2014, the Fifth Circuit Court of Appeals, sitting en banc, rendered its decision in the high-profile case McBride v. Estis Well Service, L.L.C.,12-30714, 2014 WL 4783683 (5th Cir. Sept. 25, 2014)McBride garnered national attention after the Fifth Circuit panel reversed the district court and held that punitive damages were available to seamen as a remedy for the general maritime law claim of unseaworthiness.  731 F.3d 505.  On rehearing, a majority of the Fifth Circuit judges determined that punitive damages were not available.  The majority opinion was about fifteen pages long and was followed by nearly sixty pages of concurring and dissenting opinions.

The first concurrence, penned by Circuit Judge Edith Brown Clement and joined by Circuit Judges Jolly, Smith, and Owen, took a closer look at the historical background that, in Judge Clement’s opinion, mandated the result reached by the majority.  Judge Clement dissected what she viewed as the three main points that McBride relied on and determined that, “[w]hen examined closely, none of these arguments establish McBride’s ultimate contention.”  Id. at *7.

Judge Clement first analyzed and concluded that United States Supreme Court jurisprudence does not require punitive damages in unseaworthiness cases.  The Judge noted that Exxon Shipping Co. v. Baker, 554 U.S. 471 (2008), only addressed the narrow issue of whether punitive damages were preempted by the Clean Water Act and that this narrowness accounted for the Court’s need in Atlantic Sounding Co. v. Townsend, 557 U.S. 404 (2009), to even address the issue of punitive damages in maintenance and cure cases.  According to Judge Clement, this left McBride with “only the thin strand of Townsend.”  McBride at *7.  However, Townsend, a maintenance and cure case, was of little help in light of the “significant differences” between actions for maintenance and cure and unseaworthiness.  Judge Clement cleverly cited to the academic writings of McBride’s own counsel to underscore the well-recognized distinction between the two causes of action. The Judge concluded that “[t]he difference between maintenance and cure and unseaworthiness actions make maintenance and cure cases a poor guide for determining unseaworthiness remedies.”  McBride at *8.

Judge Clement went on to examine the Fifth Circuit’s pre-Miles case law approving punitive damages in unseaworthiness cases, starting with In re Merry Shipping, Inc., 650 F.2d 622 (5th Cir. Unit B 1981).  She concluded that, notwithstanding Merry Shipping and a handful of other cases, there is an absence of actual authority establishing that pre-Jones Act plaintiffs claiming unseaworthiness were entitled to punitive damages.  The Judge characterized the support for such entitlement to punitive damages the result of a “collective judicial ‘oh, hell, why not’ principle” equating the availability of punitive damages in other types of actions to the availability of punitive damages for unseaworthiness.  McBride at *9.

Finally, Judge Clement waded through pre-Jones Act unseaworthiness cases cited by McBride in support of the availability of punitive damages and found only one unseaworthiness case that arguably awarded punitive damages.  The Judge concluded that, even assuming that this case did award punitive damages, one “dust-covered” case should not provide the basis for the general availability of punitive damages in unseaworthiness cases.  This was particularly true when considering the Supreme Court decisions in The Osceola, 189 U.S. 158 (1903) and Pacific Steamship Co. v. Peterson, 278 U.S. 130 (1928) that recognized the remedy for unseaworthiness was an indemnity by way of compensatory damages.

Judge Clement concluded her concurrence by explaining the need for caution “before signing off on an aggressive expansion of punitive damages in the unseaworthiness context.”  McBride at *12.  This is a product of the varying availability of insurance for punitive damages and the direct and indirect impacts such an expansion would have on commercial shipping.  “In light of the potentially sizable impact, this court should not venture too far and too fast in these largely uncharted waters without a clear signal from Congress.”  McBride at *12.

McBride v. Estis Well Serv., L.L.C., 12-30714 (5th Cir. Sept. 25, 2014) (en banc).