RECENT
DEVELOPMENTS IN THE COURTS - PART XI
(Published October 2004)
The following survey represents some of the more significant recent court rulings around the nation affecting shipping lines generally:
Supreme Court To Consider Whether Americans With Disabilities Act Applies to Foreign-Flagged Passenger Ships
Spector v. Norwegian Cruise Line Ltd., 356 F.3d 641 (5th Cir. 2004)
The
Supreme Court recently agreed to consider whether foreign-flagged cruise ships
embarking passengers in U.S. waters must comply with the Americans With Disabilities
Act (“ADA”). The Fifth Circuit Court of Appeals held the ADA cannot
be extraterritorially applied to foreign-flagged cruise ships without a clear
congressional expression in favor of such application. The Fifth Circuit’s
ruling directly conflicts with the Eleventh Circuit Court of Appeals’ decision
in Stevens v. Premier Cruises, Inc., 215 F.3d 1237 (11th Cir. 2000),
which held the ADA applies to foreign cruise ships even though the federal
statutory scheme is silent on such extraterritorial application. Kaye, Rose & Partners,
on behalf of the International Council of Cruise Lines (“ICCL”),
filed an amicus curiae brief in support of Norwegian Cruise Line,
urging the Supreme Court to consider the issue in light of conflicting Circuit
Court decisions resulting in industry-wide confusion as to the application
of the ADA, as well as requesting the court to consider the impact of the lack
of any ADA cruise-ship-specific regulations to guide cruise lines as to the
accessibility modifications to be implemented to comply with the ADA.
Federal Court Follows Florida’s Holding Rejecting Barbetta and Permitting Claim for Ship Physician’s Malpractice
Huntley v. Carnival Corporation, et al., 307 F. Supp. 2d 1372; 2004 AMC 728 (S.D. Fla. 2004)
Facts:
Cruise
ship passenger filed suit against a cruise line and the shipboard physician
for slip and fall
injuries allegedly sustained during
the cruise. Plaintiff claimed the cruise line was vicariously liable for the
ship physician’s medical malpractice and directly negligent as a health
care provider. The cruise line moved to dismiss plaintiff’s claims based
on Barbetta’s majority view that a shipowner cannot be held
vicariously liable for the alleged negligence of the ship’s doctor. Plaintiff
urged the court to follow the minority view, as was done in Florida’s
state court case in Carlisle.
Holding:
Finding
the state court’s decision in Carlisle v.
Carnival Corp., 864 So. 2d 1 (Fla. 3d DCA 2003) persuasive, the district
court rejected Barbetta and followed the minority view. The court reasoned
that a passenger at sea does not have meaningful control over his or her relationship
with the ship’s doctor, but rather, the passenger has no choice but to
seek treatment from the ship’s physician. The court also found persuasive Carlisle’s reasoning
that because the potential for a seriously ill or injured passenger is foreseeable
and likely to disrupt maritime pursuits, such incidents are “substantially
related to traditional maritime activity.” The court also found persuasive
that a cruise line is already held vicariously liable for the negligence of
the same physician in treating hundreds of members of the ship’s crew.
Denying the motion to dismiss, the court further rejected the contractual title
of the ship’s physician as an independent contractor, finding that the
ship’s physician is an agent of the cruise line whose negligence is imputed
to the carrier.
Outcome:
Cruise
line’s
motion to dismiss medical malpractice related claims against it denied.
Court Permits Plaintiff’s Liquor Liability Claim Under General Maritime Law
Hall v. Royal Caribbean Cruises, Ltd., 2004 Fla. App. LEXIS 10820 (Fla. 3d DCA 2004)
Facts:
A passenger aboard a cruise ship alleged he sustained injures after having
been served excessive quantities of alcohol by the ship’s employees.
The state’s trial court dismissed passenger’s action for negligence
and breach of contract of carriage. Plaintiff appealed.
Holding:
The court found plaintiff stated a cause of action for the cruise line’s
breach of duty to exercise reasonable care under the circumstances (citing Kermarec
v. Compagnie Generale Transatlantique, 358 U.S. 625 (1959)). The court
rejected what it considered the minority position, that dram shop liability
should be governed by the forum state (citing as minority opinions Meyer
v. Carnival Cruise Lines, Inc., 1994 U.S. Dist. LEXIS 21431 (N.D. Cal.
1994), and Voillat v. Red & White Fleet, 2004 U.S. Dist. LEXIS
4359 (N.D. Cal. 2004)). In reversing the lower court’s dismissal of plaintiff’s
action, the court reasoned that maritime suits, even if filed in state court,
are governed by the substantive maritime law.
Outcome:
Trial court’s dismissal of plaintiff’s action reversed.
Survival Claim and Punitive Damages Upheld; Liquor Liability Claim Rejected
Voillat v. Red and White Fleet, et al., 2004 U.S. Dist. LEXIS 4359 (N.D. Cal. 2004)
Facts:
Parents of decedent passenger brought suit against cruise line, alleging dram
shop liability, wrongful death and general maritime survival claims relating
to their son’s death after being thrown overboard by another passenger
during a San Francisco Bay cruise. Defendants brought a motion to dismiss
the survival and dram shop liability claims, as well as a motion to strike
punitive damages.
Holding:
The
court held a general maritime survival claim may be pursued for the death
of a non-seaman in state territorial waters where no federal wrongful death
statute imposed any damage limitations. The court also found plaintiffs were
entitled to punitive damages under the general maritime law and in general
maritime survival actions for “conduct which manifests reckless or
callous disregard for the right of others or for conduct which shows gross
negligence or actual malice or criminal indifference” (citing to Churchill
v. F/V FJORD, 857 F.2d 571 (9th Cir. 1988), and Evich v. Morris,
819 F.2d 256 (9th Cir. 1987)). In the absence of general maritime dram shop
liability, the court applied California state law immunizing defendants from
liability (citing Meyer v. Carnival Cruise Lines, Inc., 1994 U.S.
Dist. LEXIS 21431 (N.D. Cal. 1994).
Outcome:
Motion to dismiss survival action denied, motion to strike punitive damages
denied, and motion to dismiss dram shop liability granted.
Pennsylvania Rule Rejected in Jones Act Suit
Wills v. Amerada Hess Corp., (No. 02-7913) (2nd Cir. August 11, 2004); 2004 U.S. App. LEXIS 16510
Facts:
A seaman employed aboard defendant’s vessel was diagnosed with squamous
cell carcinoma after leaving defendant’s employ. The seaman died from
cancer complications. His estate brought a claim under the Jones Act, alleging
decedent’s cancer was due to exposure to benzene and polycyclic aromatic
hydrocarbons in excess of allowed Coast Guard regulations while working on
the vessel. The estate alleged the regulatory violations shift the burden of
proof to defendant under the Pennsylvania Rule to show that the violations
did not cause decedent’s cancer. After the district court excluded plaintiff’s
medical experts’ testimony on the issue of causation, it granted defendant’s
motion for summary judgment finding plaintiff could not establish a causal
link between the vessel’s emissions and decedent’s cancer.
Holding:
The court held the Pennsylvania Rule of The Pennsylvania, 86 U.S.
(19 Wall.) 125 (1873), was intended to address collisions and other maritime
casualties and is not applicable to seaman personal injury cases. The Pennsylvania
Rule creates a presumption that a violation of a safety rule led to the collision,
unless a shipowner can prove otherwise. The Pennsylvania Rule has been applied
where the facts suggest that the tragedy would not have occurred absent the
statutory violations. The court held that while the Rule has been applied in
Jones Act cases, there is no self-evident, natural or logical causation between
the alleged failure to monitor benzene levels and decedent’s cancer to
support application of the Rule. The court also held that in a case where an
injury has multiple potential etiologies, reliable and credible expert testimony
under the Daubert standard (Daubert v. Merrell Dow Pharm., Inc.,
43 F.3d 1311 (9th Cir. 1995)) is necessary to establish causation even in view
of plaintiff’s reduced burden of proof on causation under the Jones Act.
The court also rejected plaintiff’s claim for maintenance and cure for
an illness that manifested itself after decedent’s service on the ship,
because there was no “convincing proof of causal connection” between
the injury and the seaman’s service aboard the vessel.
Outcome:
District Court’s Order granting defendant’s Motion for Summary
Judgment affirmed.
Vessel Owner Not Required to Train Seaman To Use Ladder
Johnson v. Arctic Storm, Inc., 99 Fed. Appx. 799; 2004 U.S. App. LEXIS 10275 (9th Cir. 2004) (unpublished)
Facts:
Seaman brought an action under the Jones Act for injuries sustained when he
slipped and fell off a ladder on the ship while greasing winches. Plaintiff
alleged defendant, vessel owner, was negligent because of the condition of
the ladder from which he fell, because the owner failed to train him on proper
use of the ladder and failed to train plaintiff on the proper method of greasing
winches. Vessel owner argued it was not negligent under the Jones Act, and
the district court agreed, entering judgment in favor of vessel owner on
all counts after a bench trial. Plaintiff appealed.
Holding:
The court found there was ample evidence to support the finding that the condition
of the ladder was not unreasonably greasy or dangerous. The court further
found evidence supported that any grease on the ladder was a temporary condition
caused by plaintiff himself. Thus, the court found the district court did
not err in finding vessel owner not negligent for the condition of the ladder.
The court further held that vessel owner had no duty to train plaintiff to
face a ladder when using it because the “law does not impose a duty
to warn of an obvious danger.” The court also rejected plaintiff’s
argument that he was not instructed on proper greasing of winches, because
no one had asked plaintiff to grease the winches and therefore, vessel owner
owed no duty to train plaintiff in completing such a task.
Outcome:
The district court’s judgment was affirmed on all counts.
Eleventh Circuit Bars Loss of Society For Non-Dependent Survivor of Non-Seaman
Tucker v. Fearn, 333 F.3d 1216 (11th Cir. 2003), cert denied, 124 S.Ct. 1147 (2004)
Facts:
Plaintiff brought an action for the wrongful death of his minor child killed
in a boating collision in state territorial waters. Defendant moved to strike
plaintiff’s claim for nonpecuniary damages for loss of society.
Holding:
Guided by the goal of achieving uniformity in maritime law, the court held
non-dependent survivors of non-seamen cannot recover loss of society damages
in a wrongful death action under general maritime law. The court relied on
Mobile Oil Corp. v. Higginbotham, 436 U.S. 618 (1978), which denied loss
of society damages under the Death on the High Seas Act and Miles v. Apex
Marine Corp., 498 U.S. 19 (1990), denying loss of society damages under the
Jones Act.
Outcome:
Lower court’s grant of motion to strike nonpecuniary damages affirmed.
Punitive Damages in Seaman’s Maintenance and Cure Claim Rejected
In the Matter of the Complaint of J.A.R. Barge Lines, L.P. for Exoneration from and/or Limitation of Liability, 307 F. Supp. 2d 668; 2004 AMC 359 (W.D. Penn. 2004)
Facts:
Claimant seaman sustained injuries to his leg, requiring amputation, while “flopping
a barge.” Plaintiffs filed a civil action for exoneration from and/or
limitation of liability pursuant to the Limitation of Vessel Owner’s
Liability Act (46 U.S.C. App. § 181, et seq.) relating to claimant’s
injury claims. In his answer, claimant sought compensatory and punitive damages,
as well as a jury trial. Plaintiffs filed a motion to dismiss claimant’s
request for punitive damages in connection with claimant’s maintenance
and cure claim, and a motion to strike claimant’s jury trial request.
Holding:
Citing to the uniformity in maritime damages principle espoused by Miles
v. Apex Marine Corp., 498 U.S. 19 (1990), the court held claimant’s
request for punitive damages for failure to pay maintenance and cure benefits
under the general maritime law is unavailable even if wilfulness is demonstrated.
The court also rejected claimant’s demand for a jury trial, holding a
jury is unavailable as a matter of law under the Limitation Act which is heard
pursuant to the court’s admiralty jurisdiction (citing Lewis v. Lewis & Clark
Marine, Inc., 531 U.S. 438 (2001), and In re Consolidation Coal Co.,
123 F.3d 126 (3rd Cir. 1997)).
Outcome:
Plaintiffs’ motion to dismiss punitive damages and motion to strike demand
for jury trial granted.
Seaman’s Punitive Damages Claim Against Non-Employer Allowed
Stonger v. Central Boat Rentals, Inc., et al., 2004 U.S. Dist. LEXIS 8503 (E.D. La. 2004)
Facts:
Plaintiff, a Jones Act seaman, filed a complaint for injuries allegedly sustained
while working in an offshore drilling operation against his employer, an
offshore drilling company and a non-employer third party. Plaintiff sought
punitive damages against the non-employer defendant under the general maritime
law, claiming he was entitled to punitive damages as his injury occurred
within state territorial waters. The non-employer defendant filed a motion
to dismiss the punitive damage claim, which the court granted for non-opposition.
Plaintiff sought the court’s reconsideration of the order.
Holding:
Distinguishing plaintiff’s claim against the non-employer third-party
defendant, the court found it was brought solely under the general maritime
law and not under any statutory provision, such as Jones Act or Death on the
High Seas Act. Rejecting defendant’s argument that Miles v. Apex
Marine Corp., 498 U.S. 19 (1990), precluded nonpecuniary damages, the
court found punitive damages are allowable under the general maritime law when
there is no overlap with federal statutes. While citing to a split in the district
regarding treatment of nonpecuniary claims against third parties, as some cases
held Miles should be equally applied to third parties and others rejected
the expansion of Miles beyond the seaman-employer relationship, the
court concluded that punitive and nonpecuniary damages may be recoverable in
a general maritime law negligence action against non-employers.
Outcome:
Plaintiff’s motion for reconsideration was granted, and his punitive
damages claim reinstated.
Louisiana Appeals Court Permits Loss of Consortium Against Non-Employer by Offshore Drilling Worker
Shields v. Baker Hughes, Inc., 2004 La. App. LEXIS 148; 866 So. 2d 338 (La. App. 3rd Cir. 2004)
Facts:
Plaintiff, spouse of an injured non-seaman offshore drilling worker, sought
loss of consortium damages under the general maritime law against defendant,
a third party who did not employ the worker. Defendant filed a motion for
summary judgment to dismiss the loss of consortium claim, which the trial
court denied. Defendant applied for a supervisory writ, challenging the trial
court’s ruling.
Holding:
The court rejected defendant’s argument that the spouse’s nonpecuniary
claim for loss of consortium is barred by Miles v. Apex Marine Corp.,
498 U.S. 19 (1990), finding the nature of the worker’s relationship with
the defendant removes the spouse’s claim for nonpecuniary damages from
the preclusive effect of Miles. The court held the plaintiff may turn
to Louisiana state law which affords additional remedies not traditionally
found in maritime law, provided the remedy neither conflicts with the substantive
maritime law nor interferes with the requirement of uniformity. Because neither
the Jones Act, the Death on the High Seas Act nor unseaworthiness claims were
implicated in this case, the court found no federal impediment to the application
of Louisiana’s state law permitting a loss of consortium claim. Additionally,
the court held that applying Louisiana’s law would not interfere with
the requirement of maritime uniformity because offshore drilling activities
did not directly affect maritime shipping or commerce, and offshore oil and
gas exploration was not maritime employment.
Outcome:
The writ challenging the trial court’s ruling was denied, and the case
was remanded to the lower court for further proceedings.
Lack of Admiralty Jurisdiction Precludes Petition for Exoneration from Liability Where Damage Occurred on Land
Stevedoring Servs. of Am. v. Price, 2004 U.S. App. LEXIS 18236 (S.D. Fla. 2004)**
Facts:
Petitioners, owners of a recreational sailboat, filed suit in federal court
for exoneration from or limitation of liability under the court’s admiralty
jurisdiction. Petitioners sought to be exonerated from liability for damage
caused to several other vessels when their boat caught fire while undergoing
repairs on land. Respondent, an owner of one of the fire-damaged boats, moved
to dismiss the action for lack of subject jurisdiction, arguing there was
an insufficient connection to traditional maritime activity to support admiralty
jurisdiction.
Holding:
The court held admiralty jurisdiction is invoked when the elements of the “navigable
waters” locality test and the “significant relationship to traditional
maritime activity” nexus test are met. The court found the locality test
failed, as all the boats damaged by fire were located on land and withdrawn
from navigation for repairs. The court distinguished a situation where fully
operational boats are kept in dry storage as an alternative to wet mooring
or docking and moved in and out of water on a regular basis, finding such dry
storage would be subject to admiralty jurisdiction. The court also found the
nexus test failed because the fire posed no threat to commercial navigation,
as the boat owners were not present or actively involved in or injured by the
fire, the fire posed no threat to navigating boats, and the fire was not close
enough to the water to disrupt any vessel in the water.
Outcome:
The magistrate judge recommended respondent’s motion to dismiss be granted,
as the action was not subject to admiralty jurisdiction.
No Admiralty Jurisdiction for Scuba Diving Abroad When DOHSA Not Properly Raised as Basis for Federal Jurisdiction
Delgado v. Reef Resort Ltd., et al., 364 F.3d 642 (5th Cir. 2004)
Facts:
Plaintiff filed a complaint in a state court for the wrongful death of her
husband who never surfaced during a recreational scuba diving trip off the
coast of Belize and was presumed dead. The complaint was filed against the
operators of the resort which organized the diving trip. Defendants removed
the case to federal court, and thereafter, one of the defendants, a Belize
business entity, filed a motion to dismiss based on lack of personal jurisdiction.
The district court granted defendant’s motion, and plaintiff appealed
arguing personal jurisdiction was available under Fed. R. Civ. Pro. 4(k)(2)
and under the Death on the High Seas Act (“DOHSA”).
Holding:
The court noted Fed. R. Civ. P. 4(k)(2) permits service of process and personal
jurisdiction in any district court for cases arising under federal law, including
cases sounding in admiralty, if defendant has minimum contacts with the United
States. However, the court found no admiralty jurisdiction existed in that
the scuba accident did not result from a maritime tort, which requires an
accident be on navigable waters, that it be an incident that affects maritime
commerce, and that the events leading to the tort be connected with traditional
maritime activity. The court found the recreational scuba diving activities
did not affect maritime commerce and were not connected with traditional
maritime activities. The court further noted that while plaintiff could have
invoked DOHSA as a basis for federal admiralty jurisdiction, she did not
raise the issue in the lower court and therefore waived that argumenton appeal.
Outcome:
The court affirmed the dismissal of the wife’s claim against the Belize
resident resort operator.
Court Strikes Jury Trial for Claims Brought Under Admiralty Jurisdiction
Vanderpool v. Edmondson, 2004 U.S. Dist. LEXIS 899 (E.D. Tenn. 2004)
Facts:
Plaintiffs filed suit alleging common law tort claims, product liability claims
under Tennessee law and admiralty claims. Defendant filed a motion to strike
plaintiffs’ demand for a jury trial.
Holding:
The court found plaintiffs did not have a constitutional or statutory right
to a jury trial on their admiralty claims brought under the court’s
admiralty jurisdiction. The court further rejected plaintiffs’ claim
that defendant’s motion to strike (made several months before trial)
was untimely, as Fed. R. Civ. P. 39(a) imposes no time limit to make a motion
to strike a jury trial demand. Additionally, the court held that even if
defendant’s motion were untimely, the court has authority under Rule
39(a) to determine on its own initiative that plaintiffs have no right to
a jury trial.
Outcome:
Defendant’s motion to strike jury trial demand granted.
Court Grants Seaman’s Motion to Strike Jury Trial Request in Action Under Jones Act and General Maritime Law
Rosales v. Bouchard Coastwise Mgmt. Corp., 2004 U.S. Dist. LEXIS 9172 (E.D. La. 2004)
Facts:
Plaintiff, a seaman employed aboard defendant’s ship, filed an action
for personal injuries sustained in a slip and fall. Plaintiff’s action
was brought under the district court’s admiralty jurisdiction for Jones
Act and general maritime law claims. Plaintiff filed a motion to strike defendant’s
request for a jury trial.
Holding:
The court held that in a federal action, a plaintiff may proceed either under
the court’s diversity or admiralty jurisdiction. When a complaint contains
a statement identifying the action as one in admiralty, there is no right
to a jury trial even if diversity jurisdiction exists. The court noted that
although plaintiff made an express invocation of admiralty jurisdiction under
Federal Rule of Civil Procedure 9(h), such invocation is not necessary when
the complaint identifies the claim as one in admiralty. As plaintiff did
not invoke diversity jurisdiction and did not request a jury trial, he was
entitled to have his action proceed in admiralty without a jury.
Outcome:
Plaintiff’s motion to strike defendant’s request for a jury granted.
Jury Trial Permitted in DOHSA Action Brought in State Court
Curcuru v. Rose’s Oil Serv., 441 Mass. 12; 802 N.E.2d 1032; 2004 AMC 450 (Mass. 2004)
Facts:
Plaintiffs, the surviving widows of four seamen presumed dead when the vessel
they worked on capsized in the North Atlantic ocean, filed a state action
alleging claims under the Death on the High Seas Act (“DOHSA”).
The action was tried before an advisory jury. After the jury made findings
in favor of the plaintiffs, the trial judge determined there was no right
to a jury and made her own findings in favor of the defendant. Plaintiffs
appealed, claiming they were entitled to a jury trial on a DOHSA claim brought
in state court.
Holding:
The court recognized that DOHSA is the exclusive basis for recovering for a
death occurring on the high seas, preempting all other forms of wrongful
death claims under state or general maritime law. However, in analyzing the
history of DOHSA, the court concluded that the savings to suitors clause
under 46 U.S.C. § 767 permits a jury trial in a state court where the
state’s own procedures would include a right to a jury trial for similar
state claims. The court, citing to Offshore Logistics, Inc. v. Tallentire,
477 U.S. 207 (1986), concluded that the right to a jury trial is a saved
remedy under the DOHSA savings clause.
Outcome:
The trial court’s judgment was vacated and the matter remanded for entry
of judgments in favor of plaintiffs according to the advisory jury’s
findings.
Arbitration Clause in Seaman’s Employment Agreement Enforced Pursuant to Convention on Recognition and Enforcement of Foreign Arbitral Awards
Freudensprung v. Offshore Technical Services, Inc., et al., 379 F.3d 327 (5th Cir. 2004)
Facts:
Plaintiff, a seaman allegedly injured while working on a barge in Nigerian
waters, was employed pursuant to a consulting contract with defendant employer,
a U.S. corporation, that included a mandatory arbitration clause for all
disputes. Plaintiff filed suit in district court, alleging claims under the
Jones Act and general maritime law for unseaworthiness and maintenance and
cure. Defendant filed a motion to stay the action pending arbitration, which
the district court granted. Plaintiff appealed, claiming the agreement was
a seaman’s contract of employment and was thus exempt from arbitration
under 9 U.S.C. § 1 of the Federal Arbitration Act (“FAA”).
Holding:
The Fifth Circuit Court of Appeals noted that while the FAA generally declares
valid and enforceable arbitration provisions in maritime transactions and
contracts involving interstate or foreign commerce under 9 U.S.C. § 2,
it excludes “contracts of employment of seamen, railroad employees
or any other class of workers engaged in foreign or interstate commerce” under
9 U.S.C. § 1 from the scope of the Arbitration Act. However, the court
also noted that when the Convention on the Recognition and Enforcement of
Foreign Arbitral Awards, which is implemented by the United States through
9 U.S.C. §§ 201-208, governs enforcement of an arbitration agreement,
the FAA applies only to the extent it does not conflict with the Convention.
Unlike the FAA, the Convention does not recognize an exception for seaman
employment contracts, which the court found to be a “commercial contract” under
the Convention. Enforcement under the Convention is proper where (1) there
is a written agreement to arbitrate the matter; (2) the agreement provides
for arbitration in a Convention signatory nation; (3) the agreement arises
out of a commercial legal relationship; and (4) a party to the agreement
is not an American citizen. While both parties in this case were U.S. citizens,
the court held that because the contract involved employment abroad, it met
the “foreign element” requirement of 9 U.S.C. § 202 under
the Convention, which requires the contractual relationship to involve “property
located abroad, envisages performance or enforcement abroad, or has some
other reasonable relation with one or more foreign states.” Accordingly,
the court found plaintiff’s contract, even if it is a seaman’s
employment contract, enforceable under the Convention.
Outcome:
District Court’s Order staying the action affirmed.
Federal Court Denies Forum Non Conveniens Motion Against Foreign Seaman’s Claims
Enrique Williams v. Cruise Ships Catering and Service International, et al., 320 F. Supp. 2d 1347 (S.D. Fla. 2004)
Facts:
Plaintiff seaman sued cruise line shipowner, employer, and bare boat charterer
in Florida, alleging unseaworthiness, Jones Act negligence and maintenance
and cure for injuries allegedly sustained aboard an Italian-flagged vessel.
Defendant filed a motion to dismiss on forum non conveniens grounds contending
the injury occurred on the high seas, the law of the flag was Italian and
plaintiff was domiciled in Costa Rica. The court denied the motion, and defendant
filed a motion for reconsideration of the court’s ruling.
Holding:
Under a choice of law analysis, court found defendants conducted substantial
business in United States ports, defendant shipowner’s parent corporation’s
base of operations was in Florida, plaintiff was treated for his injuries
in the United States and decisions regarding plaintiff’s maintenance
and cure were made by defendant’s subsidiary in the United States.
Thus, the court found shipowner had a substantial base of operations in the
United States to justify application of American law.
Outcome:
Motion for reconsideration denied, however, the court certified the question
for review in the Eleventh Circuit.
Permissive Forum Selection Clause in Seaman’s Collective Bargaining Agreement Held Unenforceable
Aung Lin Wai v. Rainbow Holdings, et al., 315 F. Supp. 2d 1261 (S.D. Fla. 2004)
Facts:
Plaintiff, a citizen of the Union of Myanmar and a seaman aboard a tanker ship,
was allegedly injured while the vessel was docked in Florida. Plaintiff was
employed pursuant to a Collective Bargaining Agreement (“CBA”)
between the employer and the Seaman Employment Control Division of the Union
of Myanmar. The agreement contained a forum selection clause, indicating
the parties agreed to submit to the jurisdiction of Singapore. Plaintiff
filed suit in Florida, alleging claims under the Jones Act, Seaman’s
Wage Act and under the general maritime law for unseaworthiness and maintenance
and cure. Defendants filed a motion to dismiss based on the forum selection
clause.
Holding:
The court examined whether the Singapore forum selection clause in the CBA
was permissive or mandatory, holding that an action is only subject to dismissal
if the forum selection clause provides a particular court with exclusive
jurisdiction. However, the court noted the word “exclusive” need
not be included. The court found the forum selection clause in the CBA to
be only permissive and merely expressing a consent to jurisdiction. The court
reasoned the clause did not contain any exclusive jurisdiction language precluding
the parties from bringing claims in other courts. The court thus found the
parties merely agreed that any objections to jurisdiction in Singapore by
either party would be barred, but jurisdiction elsewhere was not waived.
Outcome:
Defendant’s motion to dismiss was denied.
Limitation of Liability Act Does Not Invalidate Forum Selection Clause
Reynolds-Naughton v. Norwegian Cruise Line Limited, 2004 U.S. App. LEXIS 19372 (1st Cir. 2004)
Facts:
Plaintiff passenger filed a negligence claim in admiralty in Massachusetts
district court against a cruise ship owner for injuries allegedly sustained
during a cruise. The cruise ship owner filed a motion to dismiss the Massachusetts
case pursuant to a forum selection clause in the cruise ticket contract.
The Massachusetts court granted the motion to dismiss and plaintiff appealed,
claiming the Limitation of Vessel Owner’s Liability Act, former 46
U.S.C.S. app. § 183(c) precluded enforcement of the forum selection
provision.
Holding:
The court rejected plaintiff’s argument that the former language of § 183(c),
invalidated a cruise ticket contract’s forum selection clause. Section
183(c) precludes shipowners from contractually limiting their liability for
personal injury due to negligence or contractually lessening or weakening the
claimant’s right to a trial by a court of competent jurisdiction. The
court relied on Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585,
596, 113 L. Ed. 2d 622, 111 S. Ct. 1522 (1991), in which the Supreme Court
read § 183(c) as allowing forum selection clauses that limited the passenger’s
choice of venue, so long as a “court of competent jurisdiction” remained
available to the passenger. Plaintiff argued that in 1992, after the Shute decision, § 183(c)
was amended to include the term “any” before the phrase “court
of competent jurisdiction” and offered legislative history indicating
the amendment was intended to overturn the result in Shute and allow
injured passengers to choose the forum and sue “in any court of competent
jurisdiction.” However, the court noted that in 1993 § 183(c) was
again amended to delete the word “any” and that the legislative
intent at that time was to restore the holding of Shute. Accordingly,
enforcement of the forum selection clause in a cruise ticket contract is not
precluded by § 183(c).
Outcome:
The District Court’s order granting motion to dismiss was affirmed.
Owner Ordered to Pay Custodial Fees In Vessel Arrest Due to Delay in Posting Bond
Ridinger v. The Motor Vessel Lady Kathryn, 2004 U.S. Dist. LEXIS 15419 (S.D. Fla. 2004) **
Facts:
Plaintiff filed an in rem and in personam complaint against a vessel, relating
to breach of a charter agreement. The court issued a warrant for arrest of
the vessel and subsequently set a $125,000 bond. Vessel owner failed to deposit
bond by the ordered date. Thereafter plaintiff petitioned for an order to
sell the vessel, which the court granted. To prevent the sale of the vessel,
the vessel owner petitioned the court for permission to post a late bond.
Plaintiff did not object to the late posting, but requested the court to
direct vessel owner to pay the custodial expenses from the date the bond
was due to the date of the hearing.
Holding:
The court agreed defendant vessel owner should bear the costs of the custodial
expenses from the initial deadline to post bond until the date of the court’s
hearing.
Outcome:
Defendant ordered to pay custodial fees prior to the release of the vessel.
Passengers Required to Amend to Properly Allege Claims Against Travel Agent and Airline
Flamenbaum v. Orient Lines, Inc., et al., 2004 U.S. Dist. LEXIS 14718 (S.D. Fla. 2004)**
Facts:
Cruise passengers filed suit against cruise line, travel agent and airline
alleging defendants irresponsibly scheduled their connecting flights to their
embarkation port for an air/cruise package, causing plaintiffs to miss their
original flights and the mishandling of their luggage which was unavailable
for most of their cruise. Plaintiffs claimed fraud in the inducement, alleging
the cruise line and their travel agent falsely represented plaintiffs’ flight
arrangements were adequate. They also alleged claims for breach of contract,
negligence and false advertising. Defendants filed their respective motions
to dismiss, claiming plaintiffs failed to state a cause of action.
Holding:
The district court dismissed plaintiffs’ fraud in the inducement claim
for lack of specificity required by Fed. R. Civ. P. 9(b), as plaintiffs failed
to allege with particularity the circumstances in which the alleged misrepresentations
were made. The court did not dismiss the breach of contract claim because plaintiffs
sufficiently asserted the cruise line was involved in arranging the inadequate
air transportation that led to the lost luggage. The court also rejected the
cruise line’s argument that the ticket contract disclaimed liability
for acts of independent contractors, because the contract was ambiguous as
to whether the cruise line would be liable for negligence based on its own
failure to exercise reasonable care. The court dismissed plaintiffs’ negligence
claims against the cruise line and travel agent based on the economic loss
rule which precludes tort claims to recover pure economic damages arising from
a breach of contract, absent personal injury or property damage. The court
found plaintiffs’ breach of contract and negligence claims were based
on the same factual allegations and thus the negligence claim was barred. The
court also found plaintiffs’ false advertising claims against the travel
agent and the cruise line failed to meet federal pleading requirements, as
the allegations did not indicate whether the claim was brought as a common
law fraud claim or under some particular statute.
Outcome:
The court granted defendants’ motions to dismiss in part and ordered
plaintiffs to amend their complaint.