Opinion
Civ. No. 98-0472, SECTION: "R" (2).
January 28, 2000.
ORDER AND REASONS
Defendants, Samedan Oil Corp. and Production Systems, Inc., have each moved this Court for summary judgment, seeking to dismiss all of plaintiff's claims against them. Because the Court finds that plaintiff, Glen Jackson, and his co-employee, Jimmy Bingham, were the borrowed employees of Samedan, it GRANTS defendants' motions.
I. BACKGROUND
Glen Jackson was a payroll employee of Oilfield Production Contractors, Inc. who was assigned to work as a junior lease operator for Samedan aboard oil platforms located in the Gulf of Mexico. Jackson contends that, while working on Samedan's South Pass 47(a) platform on October 12, 1997, he sustained severe injuries to his eyes and face when a control panel caught fire. Although Samedan's wholly-owned subsidiary, Energy Development Corp., owned the SP-47 platform, Samedan provided all employees who worked on the platform pursuant to an "Employee Leasing Agreement" dated August 1, 1996. ( See Samedan Mot. Summ. J. Ex. F.) Jackson originally brought this personal injury action only against Samedan. He amended his complaint to name additional defendants, including Production Services, Inc. PSI employed Jimmy Bingham, the production operator working on the Samedan platform with Jackson at the time of the accident.
Both OPC and PSI are in the business of supplying workers to various oil companies, including Samedan. They supplied their employees, purportedly including Jackson and Bingham, to Samedan pursuant to "Master Work or Service Contract[s]." ( See id. PSI Mot. Summ. J. Exs. D E.) These contracts state that OPC and PSI shall perform as "independent contractors" and that Samedan shall not exercise control over the employees of OPC and PSI. ( See id. Ex. D ¶ III, Ex. E ¶ III.)
With the exception of one seven-day assignment, Jackson worked exclusively on Samedan platforms during his five-month employment with OPC. ( See id. Ex. C, Boudreaux Dep., at 134-36.) Bingham likewise worked for no employer other than Samedan for five months prior to the accident. ( See id. Ex. A, Bingham Dep., at 117.) Samedan employed Jackson and Bingham to ensure gas production from the well head into the pipeline in compliance with government regulations. Jackson and Bingham worked seven days on/seven days off shifts on Samedan platforms. Samedan provided all food, lodging and transportation to and from the platforms. Samedan also provided Bingham with a small tool bag containing the tools he needed to perform his job. ( See id. at 117-18.) Jackson brought his own personal tool kit, including a pipe wrench, pliers, and screwdrivers, to the Samedan platforms. ( See id. Ex. B, Jackson Dep., at 143.) However, when he needed any additional supplies or equipment, Jackson asked Samedan to send it to the platform via the supply vessel. ( See id. at 144.)
Jackson and Bingham had worked together on Samedan's Mississippi Canyon 365 platform for a month or two before Samedan's field production foreman, Gary Ingo, sent them to work on the SP-147 platform, the day before the accident. At the time of the accident, they were the only persons on the SP-47 platform. No supervisory personnel from Samedan, OPC or PSI maintained a physical presence on the platform. Except for safety issues, Jackson and Bingham did not receive orders from Samedan regarding normal daily operations but used their own discretion in performing general maintenance work. ( See id. at 27-28.) Samedan called or sent a fax with instructions on special projects. Jackson and Bingham completed and faxed daily reports with various platform production measurements to the Samedan offices and, at the end of the week, they submitted paperwork for Samedan's review. ( See id. Ex. A, Bingham Dep., at 28-29; Ex. B, Jackson Dep., at 146, 260-61.) While stationed on the Mississippi canyon 365 platform, Bingham conducted weekly safety meetings. ( See id. Ex. A, Bingham Dep., at 31.) He based these meetings upon information contained in his weekly paycheck from PSI, unless Samedan provided other materials. ( See id.)
OPC and PSI issued paychecks to Jackson and Bingham based upon time sheets completed while they worked on Samedan platforms and verified by Samedan employees. ( See id. at 115-16; Ex. C, Boudreaux Dep., at 132.) While aboard the Samedan platforms, Jackson and Bingham did not receive any instructions or supervision from OPC or PSI. Bingham's only contact with PSI while assigned to Samedan concerned personal matters. ( See id. Ex. A, Bingham Dep., at 29-30.) Jackson testified that, if he had a problem or question regarding the Samedan platform, he called Gary Ingo first. ( See id. Ex. B, Jackson. Dep., at 321.) He also occasionally called Kurt Boudreaux, OPC's operations manager, for advice as a friend when questions arose. ( See id.) Although Samedan could not terminate Jackson's or Bingham's employment with OPC or PSI, Samedan could terminate their employment aboard its platforms. (See id. Ex. A, Bingham Dep., at 112-13; Ex. B, Jackson Dep., at 144-45.)
Samedan and PSI now move for summary judgment on the grounds that both plaintiff and Bingham are borrowed servants of Samedan and therefore plaintiff's exclusive remedy is workers compensation benefits under the LHWCA. Plaintiff argues that summary judgment is inappropriate because Samedan did not retain "authoritative direction and control" over the performance of their work. Rather, plaintiff asserts that he and Bingham were independent contractors working for OPC and PSI, respectively.
II. DISCUSSION
A. Legal Standard
Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law. See FED. R. CIV. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552 (1986). A court must be satisfied that no reasonable trier of fact could find for the nonmoving party or, in other words, "that the evidence favoring the nonmoving party is insufficient to enable a reasonable jury to return a verdict in her favor." Lavespere v. Niagara Mach. Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990) ( citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2511 (1986)). The moving party bears the burden of establishing that there are no genuine issues of material fact.
If the dispositive issue is one for which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by merely pointing out that the evidence in the record contains insufficient proof concerning an essential element of the nonmoving party's claim. See Celotex, 477 U.S. at 325, 106 S.Ct. at 2554; see also Lavespere, 910 F.2d at 178. The burden then shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. See Celotex, 477 U.S. at 324, 106 S.Ct. at 2553. The nonmovant may not rest upon the pleadings, but must identify specific facts that establish a genuine issue exists for trial. See id. at 325, 106 S.Ct. at 2553-54; Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1996).
B. Borrowed Employee Doctrine
The Outer Continental Shelf Lands Act, 43 U.S.C. § 1333, et seq., applies to this dispute because Jackson was injured on an oil platform located on the Outer Contimental Shelf, off the Louisiana coast. ( See First Supp. and Amend. Compl. ¶ XV.) OCSLA provides that the Longshore and Harbor Workers' Compensation Act, 33 U.S.C. § 901-950, regulates the right to compensation of an injured platform worker. See 43 U.S.C. § 1333 (b). Under the LHWCA, workers' compensation is the exclusive remedy for an employee against his "employer." See 33 U.S.C. § 904 (a), 905 (a). The Fifth Circuit has extended this tort immunity provision to include borrowing employers under the "borrowed employee" doctrine. See Total Marine Servs., Inc. v. Director, Office of Worker's Compensation Programs, 87 F.3d 774, 777 (5th Cir. 1996) ( citing Hebron v. Union Oil Co., 634 F.2d 245 (5th Cir. 1981); Gaudet v. Exxon Corp., 562 F.2d 351 (5th Cir. 1977)); Melancon v. Amoco Prod. Co., 834 F.2d 1238, 1243-44 (5th Cir. 1988) (citations omitted). Workers' compensation also provides the exclusive remedy for an employee injured "by the negligence or wrong of any other person or persons in the same employ." 33 U.S.C. § 933 (i). The Fifth Circuit has made clear that if two parties are the borrowed servants of the same employer, even though nominally employed by different employers, they are "persons in the same employ" for purposes of 933(i). See Perron v. Bell Maintenance and Fabricators, Inc., 970 F.2d 1409, 1412 (5th Cir. 1992). Accordingly, if this Court determines that Jackson was Samedan's borrowed employee, Samedan will be vested with § 933(i) immunity. Additionally, if Bingham was Samedan's borrowed employee, then Jackson and Bingham were "persons in the same employ" and the LHWCA will protect PSI from liability.
The district court determines the issue of borrowed employee status as a matter of law. See Capps v. N.L. Baroid-NL Indus., Inc., 784 F.2d 615, 617 (5th Cir. 1986) ( citing Gaudet, 562 F.2d at 357-58); Melancon, 834 F.2d at 1244. "[I]f sufficient basic factual ingredients are undisputed, the court may grant summary judgment." Capps, 784 F.2d at 616 ( citing Gaudet, 562 F.2d at 358-59). In Ruiz V. Shell Oil Co., the Fifth Circuit outlined nine factors used to determine whether the borrowed employee doctrine applies. 413 F.2d 310, 312-13 (5th Cir. 1969). These factors include the following:
1. Who has control over the employee and the work he is performing, beyond mere suggestion of details of cooperation?
2. Whose work is being performed?
3. Was there an agreement, understanding, or meeting of the minds between the original and the borrowing employer?
4. Did the employee acquiesce in the new work situation?
5. Did the original employer terminate his relationship with the employee?
6. Who furnished the tools and the place of performance?
7. Was the new employment over a considerable length of time?
8. Who had the right to discharge the employee?
9. Who had the obligation to pay the employee?
See id. See also Melancon, 834 F.2d at 1244. Although no single factor or combination thereof is determinative, the Fifth Circuit has generally considered the factor of control to be central. See Brown v. Union Oil Co., 984 F.2d 674, 676 (5th Cir. 1993); Melancon, 834 F.2d at 1245; Capps, 834 F.2d at 1244. However, in Gaudet, the Fifth Circuit deemphasized the control factor and found that only the fourth, fifth, sixth, and seventh factors should be considered "essential." 562 F.2d at 356. See Brown, 984 F.2d at 677 n. 2.
1. Who had Control Over the Employee and the Work He was Performing
Determination of the control factor requires the Court to distinguish ""between authoritative direction and control, and mere suggestion as to details or the necessary cooperation, where the work furnished is part of a larger undertaking.'" Ruiz, 413 F.2d at 313 ( quoting Standard Oil Co. V. Anderson, 212 U.S. 215, 222, 29 S.Ct. 252, 254 (1909)). Plaintiff argues that the absence of any physical presence by Samedan on the SP-47 platform demonstrates that Samedan enlisted two independent contractors, not borrowed employees, to operate and maintain its platforms. The Court disagrees.
Samedan provided all platform workers who worked on SP-47 pursuant to an "Employee Leasing Agreement," in which it retained "authoritative control as to the details of the services performed by it and the Employees." ( See Samedan Mot. Summ. J. Ex. F.) Samedan's production foreman Gary Ingo reassigned Jackson and Bingham from the Mississippi Canyon 365 platform to the SP-47 platform the day before the accident. ( See PSI Mot. Summ. J. Ex. F, Ingo Dep., at 65-66.) Jackson's and Bingham's work as lease operator assistant and production operator entailed routine operations and maintenance to ensure that the production of gas at Samedan oil platforms complied with government regulations and met company specifications. Samedan required them to complete morning production reports on pressures, volumes, quantities and production, and Bingham faxed these reports to the Samedan offices daily. ( See id. Ex. A, Bingham Dep., at 28-29; Ex. B, Jackson Dep., at 260-61.) Samedan kept a logbook on the platform in which Bingham and Jackson recorded the daily tasks they performed to ensure production. Although Samedan did not issue daily orders on the routine maintenance tasks, Samedan called Bingham or sent a fax with special instructions. ( See id. Ex. A, Bingham Dep., at 27.) Indeed, plaintiff testified that Gary Ingo gave Bingham some orders to follow on the day of the accident and that he and Bingham began to accomplish those tasks together. ( See id. Ex. B, Jackson Dep., at 87-88.) Jackson and Bingham both testified in their depositions that their work orders came from Gary Ingo or someone else at Samedan. ( See id. Ex. A, Bingham Dep., at 119; Ex. B, Jackson Dep., at 142-44, 321.) Neither OPC nor PSI gave them any instructions concerning the work they performed on the Samedan platforms. ( See id. Ex. A, Bingham Dep., at 118-19; Ex. C, Boudreax Dep., at 136-37.) Moreover, OPC and PSI did not have any representatives on the Samedan platform to supervise or direct Jackson's or Bingham's work. There is thus no factual dispute as to who supervised Jackson's and Bingham's work on the Samedan platforms. Compare Brown, 984 F.2d at 678 (issue of fact on borrowed employee status when conflicting testimony regarding whether payroll employer or platform owner instructed plaintiff on how, when and where to perform his cleaning duties).
That Jackson and Bingham used their own discretion in performing routine maintenance activities without daily reminders from Samedan does not preclude a finding of borrowed employee status when Samedan personnel told them "what work to do, and when and where to do it." Melancon, 834 F.2d at 1245. This Court does not interpret the control factor to require that the borrowed employer direct each and every action taken by the borrowed employee. Moreover, that Bingham conducted weekly safety meetings without direct assistance from Samedan personnel does not defeat borrowed employee status as those duties were only incidental to the central purpose of his employment, to maintain gas production from Samedan platforms. See Moody v. Callon Petroleum Operating Co., 1999 WL 596268, at *3 (E.D. La. Aug. 3, 1999). After reviewing all of the relevant deposition testimony and other evidence, the Court finds that the supervision and instruction provided by Samedan rose above "mere suggestion of details or cooperation." Accordingly, the control factor weighs in favor of finding borrowed employee status as to both Jackson and Bingham.
2. Whose Work was Being Performed?
Jackson and Bingham both testified that they knew they were assigned to Samedan to further Samedan's business, the production of oil and gas. The record indicates that the maintenance and operations conducted by Jackson and Bingham did in fact promote Samedan's business. Moreover, as in Capps, OPC's and PSI's business "exist(s) solely to furnish employees to other companies so that the employee [can] perform the work of the borrowing employer." 784 F.2d at 617. Accordingly, the second factor weighs in favor of borrowed employee status.
3. Was there an Agreement or Understanding Between the Original and the Borrowing Employer?
OPC and PSI entered into apparently identical master service contracts with Samedan. These contracts provide in pertinent part:
III. Independent Contractor Relationship
It is expressly understood that [OPC/PSI] shall perform work or services hereunder as an independent contractor. [Samedan] shall exercise no control over [OPC's or PSI's] employees, servants, agents or representatives, . . . nor the methods or means employed by [OPC/PSI] in the performance of such work or services. . . .
( See PSI Mot. Summ. J. Exs. D E.) Although the contracts specifically call for OPC and PSI employees to be considered independent contractors, the Fifth Circuit has held that such a contract provision does not automatically negate borrowed employee status. See Brown, 984 F.2d at 677-78; Melancon, 834 F.2d at 1245. "The reality at the work site and the parties' actions in carrying out a contract . . . can impliedly modify, alter, or waive express contract provisions." Melancon, 834 F.2d at 1245 (citations omitted). Analyzing contract language nearly identical to that here, the Melancon court held that the provision did not negate borrowed employee status when the nominal employer clearly understood that plaintiff would take his instructions from the borrowed employer. See id. As discussed supra, the evidence here indicates that OPC and PSI did not instruct Jackson and Bingham how to perform their duties on the Samedan platform. Indeed, Mr. Boudreaux testified that he was not allowed to instruct Jackson on his daily operations. ( See PSI Mot. Summ. J. Ex. C, Boudreaux Dep., at 136-37.) Like Melancon, Samedan told plaintiff "what work to do, and when and where to do it." 834 F.2d at 1245. The Court thus finds that the contract provision was altered by the reality at the work site, and the provision does not prohibit a finding of borrowed employee status.
4. Did the Employee Acquiesce in the New Work Situation?
"The focus of this factor is whether the employee was aware of his work conditions and chose to continue working in them." Brown, 984 F.2d at 678. Here, Jackson and Bingham worked on Samedan platforms for five months without lodging any complaints about their working conditions. See Brown, 984 F.2d at 678 (one month sufficient time to appreciate new work conditions); Cobb v. SIPCO Servs. Marine, Inc., 1997 WL 159491 (E.D. La. March 27, 1997) (Vance, J.) (two months). Indeed, Mr. Boudreaux testified that plaintiff "loved" working for Samedan. ( See PSI Mot. Summ. J. Ex. C, Boudreaux Dep., at 58.) Moreover, Jackson and Bingham knew that their nominal employers, OPC and PSI, loaned temporary employees to other companies and that Samedan was one of those companies. ( See id. Ex. B, Jackson Dep., at 151.) These factors indicate that Jackson and Bingham acquiesced in the Samedan work arrangement and favor borrowed employee status.
5. Did the Original Employer Terminate his Relationship with the Employee?
This factor does not require the lending employer to sever completely its relationship with the employee, because such a requirement would effectively eliminate the borrowed employee doctrine. See Melancon, 834 F.2d at 1238; Capps, 784 F.2d at 617-18. Rather, the court examines the lending employer's relationship with the employee while the borrowing occurs. See Capps, 784 F.2d at 618. The only contact between Bingham and PSI while Bingham was on the job site consisted of phone calls regarding "personal business" and occasional meetings before he left for his shift to ensure his satisfaction with the work assignment. ( See PSI Mot. Summ. J., Ex. A, Bingham Dep., at 29-30.) Jackson testified that he sometimes called Boudreaux at OPC "off the record" for guidance on how to perform a task on the platform, due to Boudreaux's experience in the industry. ( See id. Ex. B, Jackson Dep., at 319-21.) However, Jackson testified that he contacted Boudreaux only "as a buddy" and that he was obligated to call Ingo at Samedan with any problems. ( See id. at 321.) Boudreaux confirmed that OPC had no control over the daily operations at the Samedan platforms on which plaintiff worked. Based on this evidence, the Court finds that factor five weighs in favor of borrowed employee status.
6. Who Furnished the Tools and the Place of Performance?
Samedan furnished Jackson and Bingham with the place of employment, meals, lodging and transportation to and from work. Samedan also provided Bingham with the tools he needed on the job. Although Jackson furnished his own set of tools, he testified that Samedan owned the supplies and equipment located aboard the platform and that Samedan provided any additional equipment that he required. ( See PSI Mot. Summ. J. Ex. B, Jackson Dep., at 143-44.) There is no evidence that OPC or PSI provided Jackson or Bingham with any tools needed to perform their work assignments. This factor thus favors borrowed employee status.
7. Was the New Employment Over a Considerable Length of Time?
The Fifth Circuit has held that when "the length of employment is considerable, this factor supports a finding that the employee is a borrowed employee," but that "the converse is not true." Capps, 784 F.2d at 618. The Capps court found this factor neutral on borrowed employee status when the employee's injury occurred on the first day of the job. See id. Here, Jackson and Bingham had worked for Samedan for approximately five months prior to the alleged accident. The Court finds that the length of employment is favorable to borrowed employee status.
8. Who Had the Right to Discharge the Employee?
While Samedan did not have the right to terminate Jackson's or Bingham's employment with OPC or PSI, it did have the right to terminate their relationship with Samedan. ( See PSI Mot. Summ. J. Ex. A, Bingham Dep., at 112-13; Ex. B, Jackson Dep., at 144-45.) These facts favor borrowed employee status. See Melancon, 834 F.2d at 1216; Capps, 784 F.2d at 618.
9. Who Had the Obligation to Pay the Employee?
Finally, with respect to the last factor, OPC and PSI paid Jackson and Bingham with funds received from Samedan. Bingham sent his completed time sheets directly to Samedan while Jackson sent his time sheets to OPC and OPC then processed an invoice on his behalf to Samedan. ( See PSI Mot. Summ. J. Ex. A, Bingham Dep., at 116; Ex. C, Boudreaux Dep., at 67-68, 132.) In both cases, Samedan verified and approved the number of hours worked on its platforms. The Fifth Circuit has consistently held that this type of payment arrangement weighs in favor of a finding of borrowed employee status. See Melancon, 834 F.2d at 1246; Capps, 784 F.2d at 618.
III. CONCLUSION
For the foregoing reasons, the Court finds no factual dipute as to the Ruiz factors and that, as a matter of law, the facts overwhelmingly support a finding that both Jackson and Bingham were the borrowed employees of Samedan. As such, the LHWCA bars Jackson from seeking recovery against PSI or Samedan. The Court hereby GRANTS defendants' motions for summary judgment and dismisses plaintiff's claims against PSI and Samedan with prejudice.
New Orleans, Louisiana, this 28th day of January, 2000.