Holder, James v. Fraser Shipyards, Inc. et al

Brief in Support of 12 Motion to Dismiss

W.D. Wis.July 25, 2016

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WISCONSIN JAMES HOLDER, Plaintiff, v. FRASER SHIPYARDS, INC., NORTHERN ENGINEERING COMPANY, LLC, and THE INTERLAKE STEAMSHIP COMPANY, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) Case No. 16-CV-343 MEMORANDUM OF LAW IN SUPPORT OF DEFENDANTS FRASER SHIPYARDS, INC.’S AND NORTHERN ENGINEERING COMPANY, LLC’S RULE 12(b)(6) MOTION TO DISMISS INTRODUCTION Plaintiff James Holder (“Plaintiff”) worked at Defendant Fraser Shipyards, Inc. (“Fraser”) as a welder/ship-fitter/fabricator onboard the Herbert C. Jackson (the “Jackson”). Tradesmen International, Inc. (“Tradesmen”) provided Plaintiff’s services to Fraser, but Fraser controlled Plaintiff’s work, provided the place of performance for his work, arranged for his payment, and had the ability to terminate him. These points, among others, conclusively show that Plaintiff was a borrowed employee of Fraser during the term of his work on the Jackson. As a borrowed employee of Fraser, Plaintiff’s sole and exclusive remedy against Fraser for his alleged injuries while working on the Jackson is compensation under the Longshore and Harbor Workers' Compensation Act (“LHWCA”). Because Plaintiff is alleging tort claims against Fraser, the Amended Complaint should be dismissed as to Fraser, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 1 of 30 2 Northern Engineering Company, LLC (“Northern”) is owned by the same company as Fraser, has the same President and Chief Operating Officer and other management personnel as Fraser, and shares costs, employees, and profits with Fraser. For the purposes of the LHWCA, Northern and Fraser are a single entity. Therefore, Northern is protected by the LHWCA exclusivity bar to the same extent as Fraser. Furthermore, Northern did not owe Plaintiff any duty as a matter of law, so there is no merit to his negligence claims. For the foregoing reasons, all claims against Northern should be dismissed. FACTS Defendant Interlake Steamship Company (“Interlake”) is the owner of the Jackson, a 690-foot-long Great Lakes bulk carrier vessel. Amended Complaint ¶ 12. Plaintiff alleges that in 2015, Interlake entered into contracts and/or agreements with Fraser and Northern for the conversion of the propulsion system on the Jackson from steam to diesel, which included the installation of diesel engines, a new gear box and propeller system, exhaust gas economizers, and an auxiliary boiler, as well as new structural steel components. Id. ¶¶ 15-18. Fraser had an agreement with Tradesmen for the assignment of employees by Tradesmen to Fraser for work on various projects over the years, including the work on the Jackson (“Tradesmen Agreement”). Id. ¶ 19, and Exhibit A to Affidavit of James Farkas. The Tradesmen Agreement provides, in pertinent part: 3. TERMS OF CONTRACT: Tradesmen agrees to assign employees to the Client [Fraser] on an as needed basis-. a. . . . Client is solely responsible for directing, supervising and controlling Tradesmen employees as well as their work and Tradesmen does not warrant or insure the work. Client, in its sole discretion, may release a Tradesmen employee back to Tradesmen at any time. **** Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 2 of 30 3 c. Client, at its sole discretion, may terminate a worker assigned under this contract at any time for any lawful reason. **** 4. TERMS OF PAYMENT: The Client agrees to pay Tradesmen the bill-out rate(s) per hour, multiplied by the number of hours worked by Tradesmen workers. Client is solely responsible for verifying the accuracy of the records of actual time worked by Tradesmen employees. **** c. If the Tradesmen worker is required to transfer job sites, during the work day, the worker shall be paid and Client shall be billed at the rate of $ .30 per mile. Plaintiff was one of the employees assigned by Tradesmen to Fraser under their agreement for work on the conversion of the propulsion system on the Jackson. Amended Complaint ¶¶ 20-21. Plaintiff worked in the ballast tanks aboard the Jackson while it was in dry dock at Fraser’s shipyard. Id. ¶ 22. Plaintiff alleges that he worked as a welder-ship-fitter fabricator on the Jackson, and used abrasive blasting tools and welding torches in the course of his work. Id. ¶¶ 20-23. This work is confirmed by Plaintiff’s daily Fraser time slips attached to the Affidavit of James Farkas as Exhibit B (“Time Slips”). Plaintiff alleges that all of his claims of injuries and damages are a result of his work performed aboard the Jackson while dry-docked at Fraser’s shipyard. Amended Complaint ¶¶ 10, 25. Plaintiff concedes that his injuries are covered by the LHWCA. Id. ¶ 45. Twenty Fraser employees are pursuing LHWCA claims against Fraser for injuries related to lead exposure on the Jackson prior to March 29, 2016, and those claims are being handled by Fraser’s LHWCA insurance carrier. Affidavit of Richard J. Leighton ¶ 2. The only work that Northern performed on the Jackson while the Plaintiff was present was removing the rudder, shafts, and gearbox from the far back part of the Jackson. Affidavit of James Farkas ¶ 4. This work involved removing bolts and screws connecting those items to the Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 3 of 30 4 ship. Id. It did not require any cutting, grinding, welding, or any other work that disturbs paint or puts dust into the air. Id. Beyond removing the Jackson’s rudder, shaft, and gearbox, Northern’s work on the Jackson project was limited to working on specific components of the Jackson on Northern’s premises, which is detached from Fraser’s premises, or in a nearby storage facility. Id. ¶ 5. No Northern employee worked with the Plaintiff, supervised the Plaintiff, or was engaged in any portion of the Jackson project that was near Plaintiff’s place of work in the ballast tanks. Id. ¶ 6. Many facets of Northern and Fraser are interrelated. They share tools and employees. Id. ¶ 7. For example, Northern will use cranes operated by Fraser to complete portions of its work. Id. If there is cutting, welding, or torching to be done on a Northern project, Northern will use Fraser employees to complete that work. Id. There are seven employees who work for both Fraser and Northern: three engineers, the Safety Manager, the Vice-President of Business Development, the Sales Manager, and James Farkas, who is the President and Chief Operating Officer of both companies. Id. Fraser and Northern have the same billing, invoicing, payment, human resources, safety, business development, and sales departments. Id. ¶ 9. The same three individuals conduct the labor relations for both Fraser and Northern. Id. ¶ 10. Northern is identified as a “Related Employer” on Fraser’s LHWCA insurance coverage. Affidavit of Richard J. Leighton ¶ 3 and Exhibit 1. When Northern and Fraser work together on a project, the costs and profits are allocated between them. Affidavit of James Farkas ¶ 8. For example, the amount of time either entity uses a crane is allocated to that entity and the related costs are charged to the entity using the crane. Id. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 4 of 30 5 Fraser and Northern are both wholly owned by Fraser Industries, LLC, a Wisconsin limited liability company. Amended Complaint ¶ 3; Affidavit of James Farkas ¶ 11. Given the close ties between Northern and Fraser, when Northern does work on a Fraser project, no written agreement is executed between the parties. Farkas Affidavit ¶ 12. Fraser gives Northern a work order and Northern does the work described therein. Id. Therefore, there was no written agreement addressing the Northern – Fraser relationship on the Jackson project. Id. ARGUMENT A. Standard of Review. Survival of a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) requires the complaint to “contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Nesvold v. Roland, 37 F. Supp. 3d 1022, 1024 (W.D. Wis. 2014) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007))). When a complaint pleads facts that are “merely consistent with” a defendant’s liability, it “stops short of the line between possibility and plausibility of ‘entitlement to relief.’” Ashcroft v. Iqbal, supra, 556 U.S. at 678 (quoting Bell Atlantic v. Twombly, supra, 550 U.S. at 557). The sufficiency of a complaint is construed in the light most favorable to the non-moving party, and draws all inferences in the plaintiff’s favor. Nesvold, supra, 37 F. Supp. 3d at 1024 (citing Reger Dev., LLC v. Nat’l City Bank, 592 F.3d 759, 763 (7th Cir. 2010)). However, courts “are not bound to accept as true a legal conclusion couched as a factual allegation.” Papasain v. Allain, 478 U.S. 265, 286 (1986) (quoted in Bell Atlantic Corp. v. Twombly, supra, 550 U.S. at 555). “While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations.” Ashcroft v. Iqbal, supra, 556 U.S. at 679. Pleadings that are no more than conclusions are not entitled to the assumption of truth. Id. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 5 of 30 6 District courts may consider certain documents outside of the pleadings without converting a Rule 12(b)(6) motion to a Rule 56 summary judgment motion. Van Den Heuvel v. A.I. Credit Corp., 951 F. Supp. 2d 1064, 1071 (E.D. Wis. 2013) (citing Levenstein v. Salafsky, 164 F.3d 345, 347 (7th Cir. 1998)). For example, documents referred to in the plaintiff’s complaint or central to the plaintiff’s claim may be submitted with a motion to dismiss. Id. (citing 188 LLC v. Trinity Indus., Inc., 300 F.3d 730, 735 (7th Cir. 2002)). B. The Longshore and Harbor Workers’ Compensation Act (“LHWCA”). “The LHWCA is a non-fault federal compensation scheme designed to give protection to injured maritime workers while at the same time affording employers some degree of predictability with regard to those workers’ recoveries.” White v. Bethlehem Steel Corp., 222 F.3d 146, 148 (4th Cir. 2000) (citing Rodriguez v. Compass Shipping Co., 451 U.S. 596, 616 (1981)). “Covered employees cannot bring a personal action against their employer; their only recourse is through the LHWCA.” Id. (citing 33 U.S.C. § 905(a)). “The Act is premised on the notion that employers will accept the burden of no-fault compensation recovery in exchange for predictable liability for injuries suffered by workers.” Peter v. Hess Oil Virgin Islands Corp., 903 F.2d 935, 952 (3d Cir. 1990). Consequently, twenty Fraser employees are pursuing LHWCA claims against Fraser for injuries related to lead exposure from the same work on the Jackson as Plaintiff prior to March 29, 2016, and those claims are being handled by Fraser’s LHWCA insurance carrier. The LHWCA defines the term “employee” as “any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, and any harbor-worker including a ship repairman, shipbuilder, and ship-breaker.” 33 U.S.C. § 902(3). Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 6 of 30 7 The term “employer” is identified as: an employer any of whose employees are employed in maritime employment, in whole or in part, upon the navigable waters of the United States (including any adjoining pier, wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by an employer in loading, unloading, repairing, or building a vessel). 33 U.S.C. § 902(4). C. The LHWCA Borrowed Employee Doctrine. The general rule under the LHWCA’s Borrowed Employee Doctrine was succinctly explained by the Court of Appeals for the Eleventh Circuit in Langfitt v. Federal Marine Terminals, Inc., 647 F.3d 1116, 1127 (11th Cir. 2011) as follows: “When a general employer transfers its employee to another person or company, the latter is the employee's borrowing employer for purposes of LHWCA, and thus is liable for the Act's compensation and has the benefit of the Act's tort immunity.” See also White v. Bethlehem Steel Corp., 222 F.3d 146, 148 (4th Cir. 2000) (noting adoption of that doctrine in the Fourth Circuit); Total Marine Servs., Inc. v. Dir., Office of Worker's Comp. Programs, U.S. Dept. of Labor, 87 F.3d 774, 777 (5th Cir. 1996) (noting adoption of doctrine in the Fifth Circuit). Although there does not appear to be any decision by the Court of Appeals for the Seventh Circuit expressly adopting or applying the borrowed servant doctrine in an LHWCA case, that Court has recognized the possibility of establishing employment with a rail carrier for the analogous FELA purposes, even though the individual is nominally employed by another company, under the borrowed servant doctrine. Warrington v. Elgin, Joliet & Eastern Railway Co., 901 F.2d 88, 90 (quoting Kelley v. Southern Pacific Co., 419 U.S. 318, 324 (1975)). Fraser respectfully submits that the well-established case law supports its position that pursuant to the LHWCA’s Borrowed Employee Doctrine, Fraser was Plaintiff’s employer for Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 7 of 30 8 Plaintiff’s work on the Jackson while it was dry docked at Fraser’s shipyard from January through March of 2016. The Borrowed Employee Doctrine in the LHWCA context has been thoroughly addressed by the Court of Appeals for the Third, Fourth, Fifth, and Eleventh Circuits. The following case law shows that a “borrowed employee”—i.e. an employee of one entity (a “lending employer”) working under the direction and control of another entity (a “borrowing employer”)—will be considered an employee of the borrowing employer for the purposes of the LHWCA. The Fifth Circuit’s Borrowed Employee Doctrine is governed by its decision in Ruiz v. Shell Oil Co., 413 F.2d 310 (5th Cir. 1969). In Ruiz, the Court of Appeals for the Fifth Circuit identified nine factors to be used in determining whether an employee can be considered a borrowed employee of another entity in the LHWCA setting. The factors to be considered are: (1) Who had control over the employee and the work he was performing, beyond mere suggestion of details or cooperation? (2) Whose work was being performed? (3) Was there an agreement, understanding, or meeting of the minds between the original and 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 place for 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? Id. at 313. This has consistently been the rule applied in the Fifth Circuit since Ruiz was decided. See, e.g., Philip v. Hornbeck Offshore Servs., L.L.C., 137 F. Supp. 3d 936, 949 (E.D. La. 2015). Although no case in the Fifth Circuit has found that a single factor or combination of factors is determinative—the first factor, regarding control, has generally been most important. Brown v. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 8 of 30 9 Union Oil Co. of California, 984 F.2d 674, 676 (5th Cir. 1993). Applying the foregoing nine factors, a number of Fifth Circuit cases have found the Borrowed Employee Doctrine to apply in the LHWCA context. In Capps v. N.L. Baroid-NL Indus., Inc., 784 F.2d 615, 616 (5th Cir. 1986) the lending employer was a company specializing in the supplying of general laborers to companies in need of temporary help. The lending employer assigned an employee to work at borrowing employer’s premises, under the direct supervision of one of the borrowing employer’s supervisors, to do work for the borrowing employer. Id. The borrowing employer provided the place of employment and supplied the only tool used by the employee—a hose. Id. The employee was injured when he fell in a sump hole while doing work at the borrowing employer’s plant on the first day. Id. There was no written agreement between the lending employer and the borrowing employer, but the parties had an understanding that the lending employer would provide employees as needed to the borrowing employer. Id. at 617. The lending employer retained no control and placed no restrictions on the employee while he worked for the borrowing employer. Id. at 617-18. The borrowing employer could not terminate an employee’s employment with the lending employer, but could discharge the employee from working for the borrowing employer. Id. at 618. The lending employer paid the employee, but charged the borrowing employer for the hours worked by the employee. Id. Applying the nine-factor test to the above facts, the Court affirmed the trial court’s determination that the employee was a borrowed employee of the borrowing employer for LHWCA purposes for handling the borrowed employee’s injury claim. Id. In Melancon v. Amoco Production Co., 834 F.2d 1238 (5th Cir. 1988), amended on reh'g in part sub nom, Melancon v. Amoco Productions Co., 841 F.2d 572 (5th Cir. 1988), an Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 9 of 30 10 employee was a welder on the payroll of the lending employer but worked on the oil platform of the borrowing employer for approximately five years prior to his injury. Id. at 1241. The welder was transported to and from the platform by the borrowing employer along with the borrowing employer’s crew, and he stayed in the same bunkhouse and ate the same food as the borrowing employer’s crew. Id. The lending employer billed the borrowing employer $29 an hour for the welder’s services and from that the lending employer paid the welder $10 an hour. Id. The lending employer furnished the welder with his welding equipment and an assistant. Id. The borrowing employer provided all the materials that were to be welded. Id. The welder was supervised by a supervisor of the borrowing employer and the lending employer did not exercise any continuing control or supervision over his work. Id. at 1241-42. The borrowing employer could not terminate the welder’s employment with the lending employer, but it could ask that the welder be replaced with a different welder from the lending employer. Id. at 1242. The contract between the borrowing employer and the lending employer stated that no employee of the lending employer “is to be deemed for any purpose the agent, servant, or representative of” the borrowing employer. Id. Under the Fifth Circuit’s nine-factor test, the Court concluded that the facts demonstrated that the welder was the borrowed employee of the borrowing employer. Id. at 1246. The relationship and contractual arrangement between the borrowing employer and the lending employer in Langfitt v. Federal Marine Terminals, Inc., 647 F.3d 1116, 1127-28 (11th Cir. 2011) was very similar to that between Fraser and Tradesmen in the present case. Id. at 1128-35. The employee at issue was employed by a labor broker in the business of furnishing its day-laborer employees to clients on a temporary basis. Id. at 1118. The two companies entered into a written agreement pursuant to which the borrowing employer agreed to become “the co- Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 10 of 30 11 employer” of the workers provided by the lending employer. Id. at 1129. The borrowing employer further agreed to be “solely responsible for supervising and directing the activities of the workers between [their] arrival at and departure from the jobsite.” Id. Under that agreement, the borrowing employer also had the right to discharge any of the temporary employees. Id. The lending employer would pay the employees, but would charge the borrowing employer for such payment based on the number of hours worked by the lending employer’s employees. Id. at 1129-30. The lending employer lent an employee to the borrowing employer to assist with loading a cargo ship. Id. at 1118. Within thirty minutes of working at the borrowing employer’s site, the employee incurred the injury that led to the lawsuit. Id. The Court summarized the Court of Appeals for the Eleventh Circuit’s position on the Borrowed Employee Doctrine: When a general employer transfers its employee to another person or company, the latter is the employee's borrowing employer for purposes of the LHWCA, and thus is liable for the Act's compensation and has the benefit of the Act's tort immunity, if each of the following three criteria is satisfied: (1) Employee Consent to the New Employment Relationship. The employee must be shown to have given deliberate and informed consent to the new employment relationship with the borrowing principal. The test is objective, and the employee's consent may be shown to have been given either expressly or impliedly. (2) Borrowing Principal's Work Being Done. The work being performed by the employee at the time of the injury must be shown to have essentially been that of the borrowing principal—that is, that it was primarily the borrowing principal's interests that were being furthered by the employee's work. (3) Borrowing Principal Assumed Right to Control the Details of Employee's Work. The borrowing principal must be shown to have received, from the employee's general employer, the right to control the manners and details of the employee's work. This might be evidenced by: (a) an express agreement between the general employer and the borrowing principal that directly evidences a transfer of control over the employee to the borrowing principal; (b) the borrowing principal's actual exercise of control; (c) the borrowing principal's furnishing of the equipment and space necessary for the employee to perform the Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 11 of 30 12 work; (d) the borrowing principal's right to terminate the employee's relationship with the borrowing principal; and (e) the method and obligation of payment for the employee's services. Id. at 1127-28 (emphasis in original). Applying the above facts to the Eleventh Circuit’s three-factor test, the Court found that the injured worker was the borrowing employer’s borrowed employee for purposes of the LHWCA and therefore the employee’s negligence claim was barred by 33 U.S.C. § 905(a). Id. at 1135. In Peter v. Hess Oil Virgin Islands Corp., 903 F.2d 935, 940 (3d Cir. 1990), the Court of Appeals for the Third Circuit expressly adopted the use of the Borrowed Employee Doctrine in the context of the LHWCA. The employee at issue was directly employed by the lending employer, but the lending employer had a contractual arrangement with the borrowing employer whereby the lending employer agreed to provide personnel for general maintenance and turnaround work at the borrowing employer’s refinery. Id. at 942. Under that contract, the employee was under the borrowing employer’s exclusive direction and control and the lending employer relinquished all responsibility for the borrowed employee’s workmanship. Id. The employee worked for the borrowing employer for nine months prior to his injury, during which time the borrowing employer paid him his salary, through the lending employer. Id. The Court found that two factors should be emphasized when analyzing whether an employee is a “borrowed employee”: (1) whether the borrowing employer was responsible for the borrowed employee's working conditions, and (2) whether the employment was of such duration that the borrowed employee could be presumed to have acquiesced in the risks of his new employment. Id. at 941-42. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 12 of 30 13 Applying that two-factor test to the facts of the case, the Court found the employee was a borrowed employee because he was controlled by the borrowing employer; he acquiesced to this control; and there was an arrangement between the borrowing employer and the lending employer to supply maintenance employees. Id. at 942. The Court concluded that the employee was the “borrowed servant” of the borrowing employer under the LHWCA, and that the LHWCA was the employee’s exclusive remedy against the borrowing employer. Id. at 953. In White v. Bethlehem Steel Corp., 222 F.3d 146, 147-48 (4th Cir. 2000), the employee at issue was a heavy equipment operator for the lending employer. The lending employer rented its heavy equipment and the operator to the borrowing employer, pursuant to a contract which stated that the lending employer would maintain “exclusive direction, supervision [and] control” over its workers. Id. at 148. The lending employer paid its employees’ wages and insurance, but passed those costs through to the borrowing employer. Id. The lending employer directed the equipment operator where to report at the borrowing employer. Id. Supervisors of the borrowing employer supervised the operator’s work and told him what to do. Id. The borrowing employer reserved the right to reject any employee of the lending employer at any time. Id. If the borrowing employer dismissed one of the lending employer’s employees, that individual’s employment would be terminated. Id. Under this arrangement, the equipment operator worked at the borrowing employer’s place of business for twenty-six years. Id. Under these facts, the Court found that the equipment operator was a borrowed employee of the borrowing employer under the LHWCA, explaining: While the LHWCA does not explicitly adopt the borrowed servant doctrine, the word “employer” in 33 U.S.C. § 905(a) encompasses both general employers and employers who “borrow” a servant from that general employer. A person can be in the general employ of one company while at the same time being in the particular employ of another with all the legal consequences of the new relation. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 13 of 30 14 Id. at 149 (internal citations and quotations omitted). The Court of Appeals for the Fourth Circuit adopted the following test in this case: “In order to determine whether an employee is a borrowed servant, courts must inquire whose is the work being performed . . . by ascertaining who has the power to control and direct the servants in the performance of their work.” Id. at 149 (internal quotations omitted). To qualify as an employee’s LHWCA employer under this test, a borrowing employer only needs to exercise direction and control at the time the employee is injured. Id. The Court elaborated as follows: In order to determine direction and control, a court may look at factors such as the supervision of the employee, the ability to unilaterally reject the services of an employee, the payment of wages and benefits either directly or by pass-through, or the duration of employment. Ultimately, any particular factor only informs the primary inquiry-whether the borrowing employer has authoritative direction and control over a worker. Id. Applying that authoritative direction and control test to the above facts, the Court of Appeals for the Fourth Circuit found that the equipment operator was a borrowed employee, and the LHWCA was therefore his exclusive remedy against the borrowing employer. Id. at 151. A comparison of the facts in the above cases to the case at bar demonstrates that the Borrowed Employee Doctrine applies to the relationship between Plaintiff and Fraser. The LHWCA’s Borrowed Employee Doctrine is applicable when an individual is nominally employed by one entity, but pursuant to an agreement between the nominal employer and another business, that other business effectively controls the individual’s work, pays the individual, and provides the work to be done and the premises where the work is to be done. In the present case, although Plaintiff is nominally employed by Tradesmen, pursuant to the Tradesmen Agreement between Tradesmen and Fraser, Plaintiff was doing Fraser’s work, on Fraser’s premises, under Fraser’s control, while being paid by Fraser. Fraser respectfully submits that in light of the striking similarity between the facts of its situation with Plaintiff and the facts Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 14 of 30 15 of the foregoing cases in which the Borrowed Employee Doctrine was applied, the Borrowed Employee Doctrine is clearly applicable to Fraser in this case. D. The LHWCA’s Borrowed Servant Doctrine Applies to Plaintiff’s Work for Fraser. A brief review of each Circuit’s version of the Borrowed Employee Doctrine shows that the nine-factor test used by the Court of Appeals for the Fifth Circuit encompasses each and every element of the lesser number of factors applied in other Circuits. Fraser submits that the following application of the Fifth Circuit’s all-encompassing nine-factor test to the Plaintiff – Fraser relationship demonstrates that Plaintiff was a borrowed employee of Fraser. (1) Who had control over the employee and the work he was performing, beyond mere suggestion of details or cooperation? The authority of the borrowing employer does not have to extend to every incident of an employer-employee relationship; rather, it need only encompass the servant's performance of the particular work in which he is engaged at the time of the accident. [citations omitted] When the borrowing employer possesses this authoritative direction and control over a particular act, it in effect becomes the employer. In that situation, the only remedy of the employee is through the LHWCA. White v. Bethlehem Steel Corp., 222 F.3d 146, 149 (4th Cir. 2000). Fraser had total control over Plaintiff and the work he was performing, as demonstrated in the Tradesmen Agreement, which notes at Section 3(a) that Fraser “is solely responsible for directing, supervising and controlling Tradesmen employees as well as their work.” Tradesmen relinquished total control of Plaintiff to Fraser. Beyond that, Fraser exercised control-in-fact. This is evidenced by the Time Slips, which show that Fraser closely monitored Plaintiff’s work on a daily basis—including hours worked, tools used, work completed, and location of work. Given the foregoing points, two things are evident: (i) Fraser had control over Plaintiff by the plain terms of the Tradesmen Agreement, and (ii) Fraser controlled Plaintiff’s work, as the entity responsible for completing the Jackson project. As shown by the above case law, this Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 15 of 30 16 factor, which weighs heavily in Fraser’s favor, is usually the most determinative in a Borrowed Employee analysis. See White v. Bethlehem Steel Corp., 222 F.3d 146, 150 (4th Cir. 2000) (noting that “authoritative direction and control” are the key factors to consider). (2) Whose work was being performed? It is undisputed that Plaintiff was performing Fraser’s work. Paragraph 17 of the Amended Complaint acknowledges that Interlake contracted with Fraser to complete the project on the Jackson. The Amended Complaint then acknowledges that all of Plaintiff’s work was on the Jackson. See Amended Complaint ¶¶ 20-23. This is supported by the Time Slips, which generally note that Plaintiff’s day-to-day work took place on the Jackson, which was Fraser’s project. It is clear that any work on the Jackson was Fraser’s work and Plaintiff’s time at Fraser was spent working on the Jackson. Therefore, Plaintiff was performing Fraser’s work. (3) Was there an agreement, understanding, or meeting of the minds between the original and the borrowing employer? The standard for “agreement” in this context is low. For example, in Capps v. N.L. Baroid-NL Industries, Inc., 784 F.2d 615, 617 (5th Cir. 1986) the Court found that this element was satisfied when the borrowing employer and the lending employer had a verbal arrangement pursuant to which the lending employer would lend employees to the borrowing employer on an as needed basis. When there is a written agreement between the lending employer and the borrowing employer, the courts have found this element to be clearly satisfied. See, e.g., Langfitt v. Federal Marine Terminals, Inc., 647 F.3d 1116, 1127-28 (11th Cir. 2011). In the present case, there is the Tradesmen Agreement—a written contract between Fraser and Tradesmen establishing their relationship—which clearly states that Tradesmen will supply workers to Fraser, as needed, pursuant to specific terms and conditions. Consequently, the Tradesmen Agreement clearly satisfies this element. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 16 of 30 17 Furthermore, Paragraph 19 of the Amended Complaint states that Fraser “entered into subcontracts and/or agreements with the plaintiff’s employer, Tradesmen International, for performance of certain skilled work during the engine conversion and refurbishment work on the HERBERT C. JACKSON.” Therefore, Plaintiff acknowledges that there was an agreement between Tradesmen and Fraser pursuant to which Tradesmen would provide employees, such as Plaintiff, to complete work on the Jackson. (4) Did the employee acquiesce in the new work situation? The test for consent . . . is an objective one, and the employee may be shown to have consented either expressly or impliedly. E.g., Willis v. Cabinda Gulf Oil Co., 728 F. Supp. 328, 338–39 (D. Del. 1990) (citations omitted). Thus, we have acknowledged, regardless of the employee's subjective intent, consent may be gleaned from the employee's conduct and the nature of the employee's relationship with the borrowing principal. See, e.g., [Gaudet v. Exxon Corp., 562 F.2d 351, 356 (5th Cir. 1977)] (stating that, “by the very act of continuing in employment, [the employee] may be assumed to agree” to the LHWCA's trade- off (emphasis added). Langfitt v. Fed. Marine Terminals, Inc., 647 F.3d 1116, 1126 (11th Cir. 2011). Fraser submits that pursuant to this test, Plaintiff acquiesced to the work situation with Fraser. He showed up to work at Fraser on the Jackson four or five days a week for almost two months. He filled out the Time Slips with Fraser’s name on them. And he did work on the Jackson, which was a Fraser project under Fraser’s control. Under these facts, Plaintiff objectively acquiesced to working for Fraser and the work situation on the Jackson. Furthermore, by virtue of working for a temporary agency such as Tradesmen, Plaintiff acquiesced to working on any job that Tradesmen would send him to. As explained in Capps v. N.L. Baroid-NL Industries, Inc., 784 F.2d 615, 617 (5th Cir. 1986): The fourth factor asks whether the employee acquiesced in the new work situation. Since [Employee] worked for a company that loaned temporary employees, [Employee] knew [Temporary Agency] would send him into new work situations. Thus, going into new work situations was [Employee’s] work Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 17 of 30 18 situation. When he went to work for [Temporary Agency], he acquiesced to the fact that [Temporary Agency] would constantly send him into new work situations. See also Langfitt v. Fed. Marine Terminals, Inc., 647 F.3d 1116, 1132 (11th Cir. 2011) (reaching the same conclusion). (5) Did the original employer terminate his relationship with the employee? Under this factor, the Court of Appeals for the Fifth Circuit has stated: We do not believe that this factor requires a lending employer to completely sever his relationship with the employee. Such a requirement would effectively eliminate the borrowed employee doctrine as there could never be two employers. The emphasis when considering this factor should focus on the lending employer's relationship with the employee while the borrowing occurs. Capps v. N.L. Baroid-NL Indus., Inc., 784 F.2d 615, 617-18 (5th Cir. 1986). Although there is no indication that Tradesmen formally terminated its relationship with Plaintiff, it essentially did by granting the right to control and discharge Plaintiff to Fraser under the Tradesmen Agreement. Therefore, Tradesmen, by not retaining any control over Plaintiff’s work, as expressly noted in the Tradesmen Agreement, effectively terminated its relationship with Plaintiff for the duration of the Jackson project. (6) Who furnished tools and place for performance? In In re Knudsen, 710 F. Supp. 2d 1252, 1267 (S.D. Ala. 2010), when the employee provided most of his own tools, and the employer provided just two tools and the place of performance, the Court found that the factor leaned “in favor of borrowed employee status.” A similar finding was made in Capps v. N.L. Baroid-NL Indus., Inc., 784 F.2d 615, 618 (5th Cir. 1986), in which the Court found that even though the borrowing employer only supplied one tool to the employee, because it provided the place for performance, this factor weighed in favor of finding borrowed employee status. Other courts have also indicated that furnishing the place for Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 18 of 30 19 performance is more important than providing tools under this factor. See, e.g., Billizon v. Conoco, Inc., 993 F.2d 104, 105 (5th Cir. 1993) (indicating that place for performance is more important in finding that this factor weighed in favor of borrowed employee status). As noted in the Amended Complaint and confirmed by the Time Slips, Plaintiff performed his work on the Jackson, a boat that was in Fraser’s sole control. Fraser furnished the place of performance. There is no allegation that Tradesmen supplied any tools to Plaintiff for his work on the Jackson. Fraser submits that this factor weighs in favor of borrowed employee status. (7) Was the new employment over a considerable length of time? Plaintiff’s employment with Fraser lasted almost two months. The Court in Langfitt, supra, applied the Borrowed Employee Doctrine to an individual who had only worked for the borrowing employer for thirty minutes prior to injury. Similarly, in Capps v. N.L. Baroid-NL Indus., Inc., 784 F.2d 615, 618 (5th Cir. 1986) the Court applied the Borrowed Employee Doctrine to an employee who had only worked for the borrowing employer for one day. The Capps Court explained that: In the case where the length of employment is considerable, this factor supports a finding that the employee is a borrowed employee; however, the converse is not true. When the employee's injury occurs on the first day, it does not follow that the employee is not a borrowed employee; therefore, the factor provides a neutral assessment in the instant case. 784 F.2d at 618. Fraser submits that relative to the Langfitt and Capps cases, two months is a sufficiently considerable amount of time to satisfy this element. (8) Who had the right to discharge the employee? Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 19 of 30 20 To satisfy this element, the borrowing employer only needs to be able to discharge the employee’s employment with the borrowing employer, not with the lending employer. See, e.g., Brown v. Union Oil Co. of California, 984 F.2d 674, 676 (5th Cir. 1993); Melancon v. Amoco Prod. Co., 834 F.2d 1238, 1246 (5th Cir. 1988); In re Knudsen, 710 F. Supp. 2d 1252, 1268 (S.D. Ala. 2010). The Tradesmen Agreement specifically notes at paragraph 3(a) that Fraser: “in its sole discretion, may release a Tradesmen employee back to Tradesmen at any time,” and further notes at paragraph 3(c) that Fraser: “at its sole discretion, may terminate a worker assigned under this contract at any time for any lawful reason.” Because Fraser had the absolute right and ability to sever its relationship with Plaintiff at any time, Fraser submits that this element is satisfied. (9) Who had the obligation to pay the employee? In In re Knudsen, 710 F. Supp. 2d 1252, 1268 (S.D. Ala. 2010), the Court found that this element was met when the borrowing employer paid the staffing agency who then paid the employee, because the borrowing employer “provided the funds” from which the employee was paid. This arrangement has been held to support a finding of borrowed employee status in other cases as well. See Billizon v. Conoco, Inc., 993 F.2d 104, 105 (5th Cir. 1993); Peter v. Hess Oil Virgin Islands Corp., 903 F.2d 935, 942 (3d Cir. 1990); Melancon v. Amoco Prod. Co., 834 F.2d 1238, 1246 (5th Cir. 1988). The Tradesmen Agreement states at Paragraph 4 that Fraser “agrees to pay Tradesmen the bill-out rate(s) per hour, multiplied by the number of hours worked by Tradesmen workers.” It also notes at Paragraph 4(c) that Fraser must pay $0.30 per mile to a Tradesmen worker for any travel required by that individual. These points make it clear that Fraser had to pay Plaintiff, Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 20 of 30 21 even though the payment was routed through Tradesmen, and the above-cited case law demonstrates that such an arrangement satisfies this element. Based solely on the facts alleged in the Amended Complaint, and the evidence included in documents referenced in the Amended Complaint, Fraser respectfully submits that under the circumstances of Plaintiff’s work for Fraser on the Jackson, the foregoing elements of the Borrowed Employee Doctrine are clearly met. Consequently, Fraser submits that Plaintiff was a borrowed employee of Fraser for purposes of the LHWCA. E. Plaintiff’s Exclusive Remedy Against Fraser Is LHWCA Compensation. The general rule under the LHWCA is that “[t]he liability of an employer prescribed in section 904 of this title shall be exclusive and in place of all other liability of such employer to the employee.” 33 U.S.C. § 905(a). 33 U.S.C. § 904 only requires an employer to pay LHWCA compensation to an injured employee. This means that a borrowed employee cannot maintain any action against its borrowing employer when the LHWCA applies, except for an action for LHWCA compensation. See, e.g., White v. Bethlehem Steel Corp., 222 F.3d 146, 147 (4th Cir. 2000) (affirming dismissal of personal injury negligence action against employer who borrowed employee from another company on LHWCA grounds); Billizon v. Conoco, Inc., 993 F.2d 104, 106 (5th Cir. 1993) (affirming summary judgment against borrowed employee on the grounds of borrowing employer’s tort immunity under the LHWCA). This rule specifically bars negligence claims against a borrowing employer. See Langfitt v. Fed. Marine Terminals, Inc., 647 F.3d 1116, 1135 (11th Cir. 2011) (finding that the LHWCA barred a negligence claim against the borrowing employer); Peter v. Hess Oil Virgin Islands Corp., 903 F.2d 935, 953 (3d Cir. 1990) (same finding as Langfitt). Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 21 of 30 22 Pursuant to the plain language of 33 U.S.C. § 905(a), because Plaintiff is a borrowed employee of Fraser, he is barred from bringing any claim against Fraser beyond a LHWCA compensation claim. Consequently, Fraser submits that the Amended Complaint against Fraser must be dismissed. As noted in Paragraph 50 of the Amended Complaint, Plaintiff brings his claim against Fraser pursuant to 33 U.S.C. § 933(a), which states: If on account of a disability or death for which compensation is payable under this chapter the person entitled to such compensation determines that some person other than the employer or a person or persons in his employ is liable in damages, he need not elect whether to receive such compensation or to recover damages against such third person. (Emphasis added). By the very terms of 33 U.S.C. § 933, that statutory provision only applies to a claim by an employee against a third-party, not the employer. The following case law makes this point clear. The United States Supreme Court explained the relationship between 33 U.S.C. § 905(a) and 33 U.S.C. § 933(a) in Norfolk Shipbuilding & Drydock Corp. v. Garris, 532 U.S. 811, 818- 19 (2001): [T]he Longshore and Harbor Workers' Compensation Act (LHWCA) . . . provides nonseaman maritime workers . . . with no-fault workers' compensation claims (against their employer, § 904(b)) and negligence claims (against the vessel, § 905(b)) for injury and death. As to those two defendants, the LHWCA expressly pre-empts all other claims, §§ 905(a), (b); . . . , but it expressly preserves all claims against third parties, §§ 933(a), (i). (Emphasis added). In McLaurin v. Noble Drilling (US) Inc., 529 F.3d 285, 292 (5th Cir. 2008), the Court of Appeals for the Fifth Circuit similarly stated: If a maritime worker is eligible for workers' compensation from his employer, § 904 allows him to collect compensation and § 905(a) instructs him that his remedy under the LHWCA is his exclusive remedy against his employer. Section Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 22 of 30 23 933 specifically forbids a claim against “the employer or a person . . . in his employ,” leaving § 904 as the only avenue of recovery against the employer or a negligent coworker. In Gravatt v. City of New York, 226 F.3d 108, 115 (2d Cir. 2000) the Court of Appeals for the Second Circuit further expounded: [T]he LHWCA provides that the statutory, no-fault compensation payments are the employer's exclusive liability to its employees when they are injured in the course of their employment. “The liability of an employer prescribed in section 904 of this title shall be exclusive and in place of all other liability of such employer to the employee. . . .” 33 U.S.C. § 905(a). The employee is, therefore, barred from suing his employer in tort. See Moragne v. States Marine Lines, Inc., 398 U.S. 375, 394 n. 11, 90 S. Ct. 1772, 26 L.Ed.2d 339 (1970). On the other hand, as with most state workers' compensation schemes, the employee may sue negligent third parties in tort, notwithstanding his entitlement to no-fault compensation provided by the employer. See 33 U.S.C. § 933(a). The foregoing law makes it clear that an employee cannot maintain a Section 933 action, or any other action, against his employer, when he is subject to the LHWCA. An injured employee’s sole and exclusive remedy against his employer for an injury that is covered by the LHWCA is LHWCA compensation pursuant to 33 U.S.C. § 904. This explains why twenty Fraser employees, who worked on the same vessel, performing the same type of work in the same area of the vessel, during the same time as Plaintiff, are seeking their remedy for lead exposure in the course of that work through LHWCA claims for compensation against Fraser. In the present case, the facts demonstrate that Plaintiff is a borrowed employee of Fraser for LHWCA’s purposes. Paragraphs 50 through 54 of the Amended Complaint assert a negligence/gross negligence claim against Fraser by way of Section 933 of the LHWCA. Section 933 only allows employee claims against third parties—and specifically denies those claims against the employee’s employer. Because Fraser is Plaintiff’s employer for LHWCA purposes, Fraser respectfully submits that Plaintiff cannot pursue a Section 933 action against Fraser, and the Amended Complaint against Fraser must be dismissed. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 23 of 30 24 F. Fraser and Northern Are a Single Entity Under the LHWCA, so Plaintiff’s Claims Against Northern Are Barred by the LHWCA’s Exclusivity Provision. When two companies are closely-related—as Fraser and Northern are in the present case—they are treated as a single entity under the LHWCA. As a single entity, if one of the companies is an employer protected by the LWHCA’s exclusivity provision, the other company is as well. The key case on this point is Claudio v. United States, 907 F. Supp. 581, 585-86 (E.D.N.Y. 1995), where two companies — KMS and KMOS — were very commingled because they shared the same corporate offices, address, post office box, telephone number, and had the same fax number. Id. at 585. Both companies shared or allocated the costs of a particular job and also shared the profits or payments from a particular job. Id. KMS and KMOS also had the same president. Id. at 586. Because it was so clearly understood that the companies acted as one when performing work, no formal joint venture agreement was ever entered into between the two companies. Id. Given this relationship, the companies’ president stated that the companies were “commingled to a point that it is impossible to differentiate any distinction between.” Id. at 585. KMS claimed it was in a joint venture with KMOS, an injured employee’s employer, and therefore should be protected by LHWCA’s exclusivity provision. Id. The Court rejected this argument, indicating that a joint venture requires an agreement between two parties, “but to require Mr. Poesl to assume two different personae and as chief executive officer of KMS to agree with himself as chief executive officer of KMOS would exalt form over substance and unwisely transmogrify legal fiction into reality.” Id. at 586. Given the parties relationship, the Court found that it “tends to demonstrate the existence of a single entity, rather than the two separate entities required to create the agreement necessary for a joint venture.” Id. “The Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 24 of 30 25 application of the general rule to the facts as stated by Mr. Poesl point more convincingly to a single entity with two branches rather than a joint venture.” Id. In finding the KMS and KMOS were a single entity, the Court concluded that: [T]here are many times when separate corporate existence is disregarded in favor of the reality of viewing the corporate organizations in question as a single entity. Such an outlook is appropriate in this instance, where all the available evidence demonstrates that KMS and KMOS functioned as a single entity . . . . Here, Mr. Poesl's uncontested affidavit conclusively establishes that KMS and KMOS worked in concert as a single entity, with interrelation of operations, common management, centralized control of labor relations and common ownership. Id. at 588. “The Court therefore finds that KMS and KMOS constituted a single entity for purposes of the LHWCA, and that the exclusivity provisions of the LHWCA extend to KMS in addition to KMOS.” Id. at 589. In reaching its conclusion that KMS and KMOS were a single entity for LHWCA purposes, the Court analyzed other scenarios where such closely related entities are treated as a single entity for legal purposes, such as the Sherman Act, the NLRA, and New York Worker’s Compensation law. Id. at 586-88. The Court relied most heavily on the New York Worker’s Compensation law and cases decided thereunder which addressed the single entity doctrine, stating: The courts have held that the New York Workers' Compensation Law, and decisions construing the same, are ‘very persuasive’ in the interpretation of the LHWCA, because the LHWCA was based largely on the New York law. See Iacone v. Cardillo, 208 F.2d 696 (2d Cir. 1953); Smither & Co., Inc. v. Coles, 242 F.2d 220, 222–23 (D.C. Cir. 1957), cert. denied, 354 U.S. 914, 77 S.Ct. 1299, 1 L.Ed.2d 1429 (1957). See also Haas v. 653 Leasing Co., 425 F. Supp. 1305 (D.C. Pa. 1977) (relying on New York law).” 907 F. Supp. at 587. Following New York case law on this point is consistent with the United States Supreme Court’s deference to interpretations of the New York Worker’s Compensation law when deciding LHWCA issues. See, e.g., Potomac Elec. Power Co. v. Dir., Office of Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 25 of 30 26 Workers' Comp. Programs, U. S. Dept. of Labor, 449 U.S. 268, 275 (1980) (adopting the reasoning of the New York Court of Appeals on an LHWCA issue). Northern submits that it and Fraser are so interrelated, that a suit against one is essentially a suit against the other. As was the situation in the Claudio case, Northern and Fraser work together on projects such as the Jackson project, sharing tools and employees. Their operations are interrelated with the same billing, invoicing, payment, human resources, safety, business development, and sales departments. They share management employees with the same President and Chief Operating Officer, Safety Manager, Vice-President of Business Development, and Sales Manager. They have a centralized control of labor relations with the same three individuals conducting labor relations for both companies. They have common ownership, with both being wholly owned by Fraser Industries, LLC. In addition, Northern is named as a Related Employer on Fraser’s LHWCA insurance coverage. Northern and Fraser are so closely related that they do not even execute agreements to do work on each other’s projects. But as noted in Claudio, it would make little sense for Fraser and Northern to enter into such agreements with each other, because James Farkas would be signing the contracts as the President and Chief Operating Officer of both companies. When entities are this closely related, it would defeat the whole purpose of the LHWCA’s exclusivity provision to allow an employee of one company to bring suit against the other company as a third party. The LHWCA is meant to protect employers from tort claims. Allowing Plaintiff to sue Northern in the present case would have the same detrimental effect on Fraser as if Plaintiff could sue Fraser directly. Given the compelling case law on this point, Northern respectfully submits it is evident that Fraser and Northern are a single entity under the LHWCA, and therefore, Northern is Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 26 of 30 27 entitled to the protection of the exclusivity provision of the LHWCA to the same extent as Fraser. G. Northern Did Not Owe Plaintiff Any Duty and Did Not Breach Any Duty. Alternatively, and without in any way intending to waive or detract from the position that Northern and Fraser are a single-entity under the LHWCA, Northern submits that Plaintiff’s negligence claim against it should be dismissed on the grounds that Northern did not owe or breach any duty to Plaintiff as a matter of law. The Amended Complaint does not plead a single fact which would indicate that Northern either owed a Plaintiff any duty or breached and duty to him. Therefore, Northern cannot be liable to Plaintiff on a tort claim as the Amended Complaint contends. To survive a motion to dismiss, the complaint must make factual allegations that “raise a right to relief above the speculative level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Courts “are not bound to accept as true a legal conclusion couched as a factual allegation.” Papasain v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986) (quoted in Bell Atlantic Corp. v. Twombly, supra, 550 U.S. at 555). “While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations.” Ashcroft v. Iqbal, supra, 556 U.S. 662, 679 (2009). Pleadings that are no more than conclusions are not entitled to the assumption of truth. Id. Plaintiff’s claims against Northern are couched in negligence. Maintaining a cause of action in negligence requires the establishment of four basic elements: (1) a duty of care on the part of the defendant; (2) a breach of that duty; (3) a causal connection between the conduct and the injury; and (4) actual loss or damage as a result of the injury. Zick v. United States, 970 Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 27 of 30 28 F. Supp. 2d 886, 889 (W.D. Wis. 2013). “Whether there is a duty of care is a question of law for the court.” Boyer v. Weyerhauser, 39 F. Supp. 3d 1036, 1045 (W.D. Wis. 2014). Plaintiff does not provide any factual basis in the Amended Complaint for any duty owed to him or breached by Northern. Rather, the Amended Complaint merely concludes at Paragraphs 36-37 and 51-52 that Northern owed a duty to protect Plaintiff’s safety and was negligent in performing that duty. These unsupported legal conclusions are insufficient to survive a motion to dismiss in and of themselves, beyond the reality that they are completely without merit. There is not a single fact alleged in the Amended Complaint that would demonstrate that Northern owed a duty to keep Plaintiff safe or to provide a safe environment for Plaintiff to work in. Consequently, Plaintiff’s claim of negligence against Northern fails on the basis of Plaintiff’s pleading alone. Moreover, the Affidavit of James Farkas further establishes that Northern did not owe a duty to Plaintiff. Northern never worked on any part of the ship that Plaintiff worked on. Northern never undertook any work that would put lead or other chemicals in the air—which is what allegedly caused Plaintiff’s claimed injury. In fact, most of Northern’s work on the project took place at its shop, which is at a totally separate location than where the Jackson was located. The Amended Complaint states that Plaintiff’s work took place in the Jackson’s ballast tank. Northern never did any work near the ballast tank. Nor did any Northern employee work with Plaintiff, supervise the Plaintiff, or work on any portion of the Jackson project that was near Plaintiff’s place of work in the ballast tanks. Given these facts and Plaintiff’s failure to plead any facts which would supply grounds for showing that Northern owed Plaintiff any duty of any kind, Plaintiff cannot establish one of the essential elements of his negligence claim against Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 28 of 30 29 Northern, and Northern therefore submits that Plaintiff’s Amended Complaint should be dismissed against Northern. Furthermore, Plaintiff did not plead any facts that would show Northern breached any duty to Plaintiff. Plaintiff merely makes conclusory statements at Paragraphs 37 and 52 of the Amended Complaint that Northern breached a duty it did not have. It is clear though, that Northern could not breach any duty to Plaintiff. Northern did not engage in any work that would put lead in the air—which is the conduct that is the subject of Plaintiff’s Amended Complaint. Furthermore, because Northern did not work with or even close to Plaintiff on the Jackson, it would be impossible for it to breach a duty to him. Plaintiff’s mere legal conclusions that Northern owed him a duty and breached that duty are not sufficient to survive a motion to dismiss. Plaintiff’s factual allegations with respect to Northern are the product of pure speculation. Accordingly, Northern respectfully submits that the Amended Complaint against Northern should be dismissed. CONCLUSION Plaintiff is Fraser’s employee under the LHWCA. The LHWCA makes it clear that the sole and exclusive remedy of an employee against his employer is LHWCA compensation pursuant to 33 U.S.C. § 904. Plaintiff’s Amended Complaint asserts negligence claims against Fraser. Therefore, Plaintiff’s claims against Fraser must be dismissed. Northern and Fraser are a single entity under the LHWCA. Therefore, Northern is entitled to the same LHWCA protection as Fraser. Alternatively, Northern’s work on the Jackson was totally unrelated and detached from Plaintiff’s work on the Jackson. Consequently, given Plaintiff’s failure to allege a single fact in the Amended Complaint which would demonstrate that Northern had a duty to the Plaintiff, Plaintiff’s claim against Northern should be dismissed. Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 29 of 30 30 Based on the foregoing, Fraser and Northern respectfully request the Court to dismiss the claims against them in their entirety. Dated: July 25, 2016. JOHNSON, KILLEN & SEILER P.A. By: /s/ Richard J. Leighton Richard J. Leighton (Wis. No. 1064224) 800 Wells Fargo Center 230 W Superior St Duluth, MN 55802 Telephone: (218) 722-6331 Email: rleighton@duluthlaw.com Attorneys for Defendants Fraser Shipyards, Inc. and Northern Engineering Company, LLC Case: 3:16-cv-00343-wmc Document #: 13 Filed: 07/25/16 Page 30 of 30