May 12, 2010
Welcome to the May 12, 2010, issue of Admiralty Update, the copyrighted and trademarked e-newsletter on developments in U.S. Coast Guard regulations and state and federal court decisions of interest to the commercial and recreational mariners.
It is written, edited, and produced by Frederick B. Goldsmith
and E. Richard Ogrodowski of Goldsmith & Ogrodowski, LLC, based in Pittsburgh, Pennsylvania, U.S.A.
If you wish to unsubscribe or modify your subscription details, just click on the link at the bottom of the e-mail which alerted you to the posting of this issue on our website.
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homepage. We will not share your e-mail address and related information with anyone. We hope you enjoy the newsletter and wholeheartedly encourage your feedback.
This issue's photo (by Fred Goldsmith) depicts the sternwheel from the towboat JASON. The JASON was first owned by Union Barge Line Corporation and was in operation from 1940 to 1959. It was homeported in Pittsburgh. A plaque on the sternwheel, which now sits on the left descending bank of the Ohio River across from downtown Pittsburgh, beneath the Fort Pitt Bridge (which appears in the background), informs that the JASON, "one of the last steam sternwheelers," was powered by two compound engines producing 1600 HP, and that the welded construction of the wheel was "fairly new at the time."
G&O Personnel News
Fred Goldsmith Moderates Seminar on
Evolving Federal Court Pleading Standards
On April 21, 2010, Fred Goldsmith moderated a continuing legal education
seminar entitled, "Drafting and Challenging Federal Court Complaints:
Three Federal Judges and a Law School Professor Outline Pleading and
Motion to Dismiss Practice Post Twombly and Iqbal."
Panelists included Judge Nora Barry Fischer of the U.S. District Court
for the Western District of Pennsylvania, Judges D. Michael Fisher and
Thomas M. Hardiman of the U.S. Third Circuit Court of Appeals, and
Professor Rhonda Wasserman of the University of Pittsburgh School of
Law.
Fred Goldsmith Examines Importance of Crew Training
in his March 2010 Column in MarineNews Magazine
Link to
"Foreseeable
Emergencies: Operators Liable for Training Crews."
Fred Goldsmith Makes Guest Appearances on
"On the Road with Rocky," ESPN Radio 1250 AM
Fred was invited by host Rocky Marks to appear on his popular Pittsburgh
motorcycle-focused radio show. He'll be featured on the shows
which air
January 30 and February
13, 2010, from 8:00 to 9:00 A.M.
Tune in (or click the link on the date, above) to hear Fred discuss legal aspects of motorcycling, including
motorcycle insurance and what to do if you're involved in an accident.
G&O at the Pittsburgh Boat Show
G&O
was at the 2010 Pittsburgh Boat Show, January 21-24, 2010,
http://www.pittsburghboatshow.com, in Monroeville at the Convention
Center. If you missed us and our booth (B-39), you also missed a
chance to register for a drawing to win a free Standard Horizon submersible VHF
Marine Radio! The winner is Scott Anderson. Congrats Scott! We had a
swell time at the show, met lots of great
people, and look forward to next year's show!
Goldsmith Publishes Another Column in
Inland and Near-Shore Maritime Industry Trade Magazine, MarineNews,
on Vessel Owner's Duty of Seaworthiness
Link to the January 2010 issue of MarineNews magazine to read Fred Goldsmith's
most recent column,
"A Vessel Owner's
Warranty of Seaworthiness."
Recent U.S. Coast Guard Notices in the Federal Register
Coast Guard Seeks Applicants for
Boating Safety Advisory CouncilIn the
May 10, 2010, Federal Register, the Coast Guard advertises
for positions on this unpaid advisory committee which "advises the Coast
Guard on recreational boating safety regulations and other major boating
safety matters."
Coast Guard Seeks to Amend Its
Recreational Boating Regulations
In the
May 7, 2010, Federal Register, the Coast Guard publishes a
Notice of Proposed Rulemaking which would "amend its rules related to
numbering of undocumented vessels and reporting of casualties. These
changes would align and modernize terminology used in the Standard
Numbering System (SNS), the Vessel Identification System (VIS), and
casualty reporting; require validation of vessel hull identification
numbers; require SNS vessel owners to provide personally identifiable
information; and provide administrative flexibility for States."
Recent State & Federal Court Maritime Decisions
U.S. Third Circuit Court of Appeals: Ryan
Doctrine's Implied Contractual Warranty of Workmanlike
Performance Applies in Traditionally Tort-Duty-Only Tug-Tow
Context
In In re J.A.R. Barge Lines L.P., 2010 WL 1303464 (3d Cir. April 6, 2010), a three-judge panel of the
Third Circuit Court of Appeals affirmed the trial court's application of
the Ryan doctrine, named after Ryan Stevedoring Co. v.
Pan-Atlantic Steamship Corp., 350 U.S. 124 (1956), and required Mon
River Towing, the employer of a Jones Act seaman who suffered a serious
personal injury while working as a deckhand aboard a Mon River towboat
which was shifting Ingram barges at an Ingram terminal on the
Monongahela River near Pittsburgh, to indemnify Ingram for Ingram's
defense costs. In the Ryan decision, a case involving a
longshoreman who was injured unloading a ship, the Supreme Court implied
a warranty of workmanlike performance in the shipowner/stevedore
contract which, if breached, entitled the shipowner to indemnity from
the stevedore. Here, Mon River settled with its injured deckhand
then, as a settling tortfeasor, asked the court to dismiss Ingram's
claims against it under the proportionate share settlement credit rule
announced in McDermott, Inc. v. AmClyde, 511 U.S. 202 (1994), and
Boca Grande Club, Inc. v. Florida Power & Light Co., 511 U.S. 222
(1994). The trial and appeals courts refused, holding the
tort-based proportionate share settlement credit rule did not apply to
Ingram's contractual indemnity claim. The trial and appeals courts
did not accept Mon River's argument that it, as a tower, only owed
Ingram a tort-based duty of reasonable care under Stevens v. The
White City, 285 U.S. 195, 52 S.Ct. 347, 76 L.Ed. 699 (1932), and
thus that it could not be subject to an implied contractual warranty.
The appeals court wrote: "It may very well be that Ryan indemnity
has outlived its usefulness, but, since we are not sitting en banc,
we have no authority to decline its application in the present context.
Furthermore, the Supreme Court has not overruled Ryan in its
entirety, despite the 1972 amendments to the LWHCA. Unless and until
that happens, it appears that the doctrine will linger on, regardless of
heavy criticism."
Ed Note: Fred Goldsmith was
counsel for Mon River initially at the trial court level and, after the
injured seaman's counsel defended Mon River for the bulk of the balance
of the trial court proceedings pursuant to a settlement agreement's
defense and indemnity obligation, was asked to continue to represent Mon
River on appeal. The Third Circuit recently denied panel and en
banc rehearing. Mon River now has the right to petition the U.S. Supreme Court for a writ of certiorari.
Michigan Federal District Court: Plaintiff May Not Argue His Jones Act and General Maritime Law Claims
Are His Only Avenue to Recovery; Defendants Did Not Demonstrate that a Broader Order Prohibiting the Use of the Phrases “One Day in Court” and “Workers Compensation” Was Necessary
In Klump v. Oglebay Norton Marine Services Co., LLC, 2010 WL 1463194 (E.D. Mich. April 12, 2010), the court granted in part and denied in part without prejudice defendants’ “motion in limine to preclude plaintiff from arguing ‘that this lawsuit in general, or the Jones Act in particular, is his ‘only remedy’ or that this lawsuit represents plaintiff’s only chance to have his day in court.’” The court found that the plaintiff could not argue this case was his “only” avenue to recovery, as the plaintiff did not articulate “how the availability or unavailability of other avenues of recovery [was] relevant to his ability to recover under the Jones Act.” Nevertheless, the court also found that the defendants did not demonstrate “that a broad order prohibiting the use of the phrases ‘one day in court’ and ‘workers compensation’ [was] necessary,” because the plaintiff should be free to remind the jury that the instant lawsuit is his “one day in court” as it relates to the defendants and it is also possible that workers compensation may be relevant at some point during trial.
Texas Federal District Court: Plaintiff May Serve As the Substitute Custodian of an Arrested Vessel
In Mile 533 Marine Ways, Inc. v. M/V CLARISSA, 2010 WL 1371642 (S.D. Tex. April 2, 2010), the plaintiff filed a verified complaint seeking the arrest of the M/V CLARISSA. The district court issued an order authorizing the arrest of the vessel
and the U.S. Marshal Service arrested the vessel on March 30, 2010. The plaintiff
then filed a motion for appointment of substitute custodian and sought to have itself appointed as the substitute custodian. After noting there is “scant case law addressing the propriety of having a party in litigation also serving as the substitute custodian,” the district court granted the motion. An important factor in the district court's granting the motion was the consent of the vessel owner to having the plaintiff serve as the substitute custodian
in lieu of the U.S. Marshal's Service.
Louisiana Federal District Court: U.S. Army Corps of Engineers
Liable for Hurricane Katrina Flooding Damages For Failure to Properly Maintain
and Operate Navigation Channel
In In re Katrina Canal Breaches Consolidated Litigation, 2009
WL 3856346 (E.D. La. Nov. 18, 2009), Judge Stanwood R. Duval, Jr. found
the Corps could be held liable under the Federal Tort Claims Act for six
named plaintiff homeowners' damages for activities surrounding a
navigation canal despite the fact those actions caused the failure of
certain levees, thus denying the government's defense that the Flood
Control Act of 1928 barred the plaintiffs claims. The navigation canal
in question is the "MRGO," an acronym for the Mississippi River Gulf
Outlet, which New Orleanians refer to as the "Mister Go."
Florida Federal District Court: Plaintiffs Entitled to Salvage Award of $290,700 for Their Efforts in Rescuing Three Vessels During Hurricane Wilma
In O’Hagan v. M&T Marine Group, LLC, 2010 WL 1372431 (S.D. Fla. Mar. 31, 2010), Thomas O’Hagan and Francisco Arroyo, independent maritime contractors working and living in Broward County, Florida and serving as sub-contractors for M&T Marine Group, LLC (“M&T”), noticed, during Hurricane Wilma, several brand new vessels owned by M&T “were taking on water because the floating docks the vessels were tied to were sinking and pulling the vessels over.” The court found O’Hagan and Arroyo provided services to three of the vessels, including cutting dock lines from the sinking piers, relocating the vessels to a seawall a few hundred yards away, pumping water out of the vessels, and taking steps to preserve and secure the vessels. The court
found the post-salvage value of the three vessels to be $1,938,000 and awarded O’Hagan and Arroyo 15% of this
sum, $290,700, to be divided equally.
Pennsylvania Federal District Court: Barge Owner Entitled to Recover Attorney's Fees
Due to River Terminal's Bad Faith Defense of Barge Breakaway Case
Mon River Towing, Inc. v. Industry Terminal and Salvage Co., 2010 WL 1337693 (W.D. Pa. Mar. 31, 2010), involved a claim by Mon River Towing, Inc. (“MRT”) against Industry Terminal and Salvage Co. (“ITS”) in which MRT alleged ITS negligently allowed MRT’s new barges, which it had chartered, to break free from ITS’s fleeting facility, damaging the barges. The court found ITS was negligent and liable for the breakaway.
It further found ITS acted in bad faith during the case for continuing to contest liability despite knowing early on that it was liable for the breakaway, withholding “evidence that should have properly been part of early disclosure, discovery, and pretrial proceedings,” and presenting self-serving, inconsistent trial testimony that lacked credibility. As such, the court stated it would entertain a motion by MRT to recover attorneys’ fees and costs related to investigating and litigating the issues of bailment and liability.
Illinois Federal District Court: OSHA Violation Constitutes Negligence Per Se Under Jones Act
In Webb v. TECO Barge Line, Inc., 2010 WL 552309 (S.D. Ill. Feb. 12, 2010), the plaintiffs’ amended complaint alleged the plaintiffs
sustained injuries as a result of being required to stay on defendant’s vessels during the onslaught of Hurricane Katrina.
Plaintiffs further alleged a violation of OSHA, which they alleged constituted negligence per se under the Jones Act. In denying the defendants’ motion to dismiss or, in the alternative, strike the amended complaint, the court, relying on Practico v. Portland Terminal Co., 783 F.2d 255 (1st Cir. 1985), held that a violation of OSHA does constitute negligence per se under the Jones Act.
Pennsylvania Federal District Court: Plaintiff’s Jones Act Suit
Untimely Filed and Thus Barred
In Reichert v. Mon River Towing, Inc., 2010 WL 419435 (W.D. Pa. Jan. 29, 2010), Brendan Reichert filed a Jones Act claim in federal court on November 9, 2009, alleging he was injured on July 16, 2006, by a faulty locking mechanism on a winch. Prior to filing his lawsuit in federal court, Reichert had filed a similar Jones Act claim in Ohio state court. MRT moved to dismiss the suit on the bases of lack of personal jurisdiction and, alternatively, due to forum non conveniens as Reichert’s accident occurred in Pennsylvania, the vessel and crew were maintained and primarily located in Pennsylvania, and MRT only occasionally dropped off barges for repair at a landing in East Liverpool, Ohio. On October 26, 2009, the Court of Common Pleas of Columbiana County, Ohio, granted MRT’s motion to dismiss for lack of personal jurisdiction and dismissed the suit without prejudice. The district court, in granting Mon River’s motion to dismiss the federal court suit, found that the 3 year statute of limitations for Jones Act claims was not tolled
by the timely-filed state court suit because Reichert’s failure to file the original case in Pennsylvania was inexplicable and inexcusable and that Reichert had failed to act reasonably.
New Jersey Federal District Court: Insurer May Not Rely on the Doctrine of Uberrimae Fidei When Marine Insurance Contract On Its Face Allows it to Void Coverage for Only Intentional Misrepresentations
In New Hampshire Ins. Co. v. Diller, 678 F.Supp.2d 288 (D.N.J. Dec. 23, 2009), the insurer and insured entered into a marine insurance contract that contained the following clause: “Any relevant coverage(s) shall be voided if you intentionally conceal or misrepresent any material fact or circumstance relating to this insurance, or your insurance application, before or after a loss.” In denying the insurer’s motion for summary judgment, the court held that an insurer may not rely on the doctrine of uberrimae fidei when the marine insurance contract’s terms allow the insurer to void coverage for only intentional misrepresentations. The court also found there was a fact issue as to whether the insured harbored the requisite intent to misrepresent or conceal to permit rescission of the policy.
Louisiana Federal District Court: Waters of Privately Owned and Maintained Pipeline Canal Are Navigable for Purposes of Federal Admiralty Jurisdiction
In Landry v. Columbia Gulf Transmission Co., 2009 WL 4064107 (E.D. La. Nov. 23, 2009), the plaintiffs alleged “they were injured when, during a nighttime, recreational ‘frogging’ excursion, [plaintiff’s] aluminum boat hit a concrete bulkhead located in Columbia Gulf’s pipeline canal.” The defendants maintained that admiralty jurisdiction did not “exist over plaintiffs’ claims because the alleged injuries occurred in a privately owned, privately maintained pipeline canal that is blocked on one end by rocks and, on the other, by a concrete bulkhead.” In finding the pipeline canal navigable, the court noted that “two or three navigable waterways open into the pipeline canal between the site of the accident and the next bulkhead to the west” and that “small commercial vessels-utilized by fur trappers, alligator hunters, and fishermen, as well as Defendants' personnel-have entered, and traveled through this portion of the pipeline canal, via one or more of these navigable waterways, with the knowledge of Columbia Gulf and Continental.” The court thus found “the evidence reveals that this particular portion of the Columbia Gulf canal, with Defendants’ knowledge and, at least in some circumstances, express permission, has been rendered ‘susceptible of being used, in its ordinary condition, by uniting with other waters, as a continued highway for commerce with another state or foreign country.” The court also concluded that the requisite maritime connection existed because a vessel allision in the privately owned canal where it was found to be navigable has a potentially disruptive impact on maritime commerce. As such, the court refused to dismiss the plaintiffs’ claims on the basis of lack of admiralty jurisdiction.
New Jersey Federal District Court: Floating Homes at Marina on
Channel Off Intercoastal Waterway Are "Vessels" Subject to Maritime Lien
In Sea Village Marina, LLC v. A 1980 Carlcraft Houseboat,
2009 WL 3379923 (D. N.J. October 19,
2009), the court held that "[b]ecause a floating home floats and can, as
a practical possibility, be towed to move the owner's home to a new
marina, it is a vessel unless it has been permanently moored."
U.S. Second Circuit Court of Appeals: Electronic Fund Transfers Being Processed by an Intermediary Bank in New York Are Not Subject to Attachment Under Rule B
In Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 585 F.3d 58 (2d Cir. Oct. 16, 2009), the Second Circuit, overruling its prior decision in Winter Storm Shipping Ltd. v. TPI, 310 F.3d 263 (2d. Cir. 2002), held that
Electronic Fund Transfers (EFTs) being processed by an intermediary bank in New York were not subject to attachment under Rule B
of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture
Actions of the Federal Rules of Civil Procedure. The
Court specifically found that “[b]ecause EFTs in the temporary possession of an intermediary bank are not property of either the originator or the beneficiary under New York law, they cannot be subject to attachment under Rule B,” which allows attachment only of “defendant’s property.” Additionally, in overruling Winter Storm, the Second Circuit mentioned a report from The Clearing House Association, LLC that Winter Storm’s unforeseen consequences included an increase in litigation in the Southern District of New York where 33% of all lawsuits filed in the District between October 1, 2008,
and January 31, 2009, were by maritime plaintiffs seeking to attach a total of $1.35 billion.
U.S. Second Circuit Court of Appeals: Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 2009 WL 3319675 (2d Cir. Oct. 16, 2009), Applies Retroactively
In Hawknet, Ltd. v. Overseas Shipping Agencies, 590 F.3d 87 (2d Cir. Dec. 22, 2009), the Second Circuit held that its decision in Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 2009 WL 3319675 (2d Cir. Oct. 16, 2009),
discussed above, applies retroactively because it directly affected how the district court may obtain personal jurisdiction over defendants.
Lagniappe
Hugh Gallagher's College Application Essay
Since it is the season when many high school seniors are anxiously
awaiting word from college and university admissions committees, this
mock or real--no one is sure--essay prepared by Hugh Gallagher in the
early 1990s, which made its way around the country then via fax (yet is
now available on the Internet), should provide a welcome respite to
parents and their college and university-bound children. Gallagher
apparently attended NYU and in 1998 wrote a novel, "Teeth," which
Amazon.com carries.
3A. ESSAY: IN ORDER FOR THE ADMISSIONS STAFF OF OUR COLLEGE TO GET TO
KNOW YOU, THE APPLICANT, BETTER, WE ASK THAT YOU ANSWER THE FOLLOWING
QUESTION:
ARE THERE ANY SIGNIFICANT EXPERIENCES YOU HAVE HAD, OR ACCOMPLISHMENTS
YOU HAVE REALIZED, THAT HAVE HELPED TO DEFINE YOU AS A PERSON?
I am a dynamic figure, often seen scaling walls and crushing ice. I have
been known to remodel train stations on my lunch breaks, making them
more efficient in the area of heat retention. I translate ethnic slurs
for Cuban refugees, I write award-winning operas, I manage time
efficiently. Occasionally, I tread water for three days in a row.
I woo women with my sensuous and godlike trombone playing, I can pilot
bicycles up severe inclines with unflagging speed, and I cook
Thirty-Minute Brownies in twenty minutes. I am an expert in stucco, a
veteran in love, and an outlaw in Peru.
Using only a hoe and a large glass of water, I once single-handedly
defended a small village in the Amazon Basin from a horde of ferocious
army ants. I play bluegrass cello, I was scouted by the Mets, I am the
subject of numerous documentaries. When I'm bored, I build large
suspension bridges in my yard. I enjoy urban hang gliding. On
Wednesdays, after school, I repair electrical appliances free of charge.
I am an abstract artist, a concrete analyst, and a ruthless bookie.
Critics worldwide swoon over my original line of corduroy evening wear.
I don't perspire. I am a private citizen, yet I receive fan mail. I have
been caller number nine and have won the weekend passes. Last summer I
toured New Jersey with a traveling centrifugal-force demonstration. I
bat 400. My deft floral arrangements have earned me fame in
international botany circles. Children trust me.
I can hurl tennis rackets at small moving objects with deadly accuracy.
I once read Paradise Lost, Moby Dick, and David Copperfield in one day
and still had time to refurbish an entire dining room that evening. I
know the exact location of every food item in the supermarket. I have
performed several covert operations for the CIA. I sleep once a week;
when I do sleep, I sleep in a chair. While on vacation in Canada, I
successfully negotiated with a group of terrorists who had seized a
small bakery. The laws of physics do not apply to me.
I balance, I weave, I dodge, I frolic, and my bills are all paid. On
weekends, to let off steam, I participate in full-contact origami. Years
ago I discovered the meaning of life but forgot to write it down. I have
made extraordinary four course meals using only a mouli and a toaster
oven. I breed prizewinning clams. I have won bullfights in San Juan,
cliff-diving competitions in Sri Lanka, and spelling bees at the
Kremlin. I have played Hamlet, I have performed open-heart surgery, and
I have spoken with Elvis.
But I have not yet gone to college.
Post-Accident Checklist:
-
If you or others are injured, call 911 for EMS and, if applicable,
local or state police, sheriff, etc. Following a commercial
vessel accident on U.S. navigable waters, meeting certain thresholds
(
http://edocket.access.gpo.gov/cfr_2008/octqtr/pdf/46cfr4.05-1.pdf),
the owner, agent, master, operator, or person in charge must
immediately (24/7) notify (call) the nearest USCG Sector Office,
Marine Inspection Office, or Coast Guard Group Office, followed
within five (5) days by a written report on USCG Form CG-2692 (http://www.uscg.mil/forms/cg/CG_2692.pdf).
U.S. commercial vessel operators must also comply with USCG
post-accident drug & alcohol testing and reporting regulations.
Oil and chemical spills must be immediately (24/7) reported to the
National Response Center (http://www.nrc.uscg.mil/nrchp.html)
(800-424-8802 or 202-267-2675) and any other applicable state and/or
local agencies.
-
If no EMS/hospital treatment is obtained, see your own doctor or
hospital Emergency Room
ASAP, as your medical condition indicates.
-
Get photos,
even with a cell phone or disposable camera, of the accident scene,
vessels, vehicles, equipment,
products, involved.
-
If possible,
preserve the accident scene and any vessels, equipment, or products, involved,
until it can be investigated.
-
Write down
the name, address, and phone number of all witnesses.
-
Immediately report
the accident (if aboard a vessel, to the captain or other in
charge), orally and in writing, describing the highlights of how
all persons, vehicles, equipment, and/or products played a part.
-
Try to avoid
discussing the accident or giving a written or recorded statement until
you have the opportunity to talk to your lawyer. If aboard a
commercial vessel and a Coast Guard investigation is underway, most
USCG personnel will allow you to have a lawyer present. You can call G&O 24/7 toll free at
1-877-404-6529 (1-877-40-GO-LAW).
Reader Feedback
We truly appreciate and welcome your feedback – positive, negative, or in-between. Just e-mail Fred Goldsmith at
fbg@golawllc.com.
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