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Barry Graham Offshore Serv. v. WT Offshore Serv

United States District Court, E.D. Louisiana
Feb 6, 2004
CIVIL ACTION NO. 03-351, c/w 03-2077 2078, SECTION "J" (3) (E.D. La. Feb. 6, 2004)

Opinion

CIVIL ACTION NO. 03-351, c/w 03-2077 2078, SECTION "J" (3)

February 6, 2004


ORDER AND REASONS


Before the Court is the plaintiff's' motion for leave to amend complaint to add insurer. Defendant filed formal opposition memorandum, to which the plaintiff replied. Thereafter, the matter was deemed submitted for decision. For the following reasons, the motion for leave to amend is DENIED.

BACKGROUND

The captioned consolidated admiralty and maritime proceedings were filed pursuant to 28 U.S.C. § 1333 and so designated pursuant to Rule 9(h) of the Supplemental Rules for Certain Admiralty and Maritime Claims. The litigation arises out of an allision between the M/V AMETHYST, an offshore supply vessel owned by Barry Graham Offshore Service, L.L.C. ("BGOS"), and an unmanned platform designated Vermilion 226D, which was fixed at a location beyond Louisiana's three-mile territorial limit. The unmanned oil platform, owned and controlled by W T Offshore Services, Inc. and W T Offshore, L.L.C., was allegedly an obstruction to navigation because it was not equipped with appropriate functioning navigational aids, all as more specifically set forth in the pleadings. In addition to the lead case filed by BGOS for damage with respect to the M/V AMETHYST and protection/indemnity with respect to all passenger claims/lawsuits, the consolidated cases involve claims filed by seamen members of the crew of the M/V AMETHYST. The consolidated claims of seamen, Kevin Jolivette and Tony Lavergne, were filed, pursuant to the Jones Act, 46 U.S.C. § 688 and the admiralty and general maritime laws of the United States, in the Southern District of Texas, but were transferred to this Court pursuant to 28 U.S.C. § 1404(a).

ANALYSIS

Louisiana's Direct Action Statute, La.Rev.Stat. § 22:655, permits an action against an insurer of a tortfeasor if the plaintiff can establish that (1) the accident occurred in Louisiana, or (2) the policy was written in Louisiana, or (3) the policy was delivered in Louisiana. Grubbs v. Gulf International Marine Inc., 13 F.3d 168, 170 (5th Cir. 1994). Louisiana's Direct Action statute "legislatively expunges the traditional 'no action' clause of a liability policy to permit a party injured in Louisiana to sue the liability insurer directly without going through the process of suit and judgment against the Assured." In the case it bar, it is not disputed that the policy was delivered in Louisiana. The focus of the dispute centers on whether Louisiana law may be deemed "applicable" as "surrogate" federal law in this case, involving the allision of a vessel with an unmanned oil platform fixed on the Outer Continental Shelf beyond the state's territorial limit.

Continental Oil Co. v. London Steam-Ship Owners' Mutual Insurance Association, 417 F.2d 1030, 1032 (5th Cir. 1969) (noting that "[l]ike so much legal jousting, the principle may be worth more than the principal").

In Rodrigue v. Aetna Casualty Co., 395 U.S. 352 (1969), the Supreme Court held that the Outer Continental Shelf Lands Act ("OCSLA") requires application of state law to injuries occurring on fixed platforms on the Outer Continental Shelf 43 U.S.C. § 1333(a)(2). Finding that Congress intended to treat fixed platforms as "artificial islands" rather than as vessels, the Court found maritime law to be inapplicable; therefore, state law applied as to the platform as if it were Louisiana soil.

The exception to Rodrigue, supra, regarding platform injury and the application of state law, are cases in which contrary rules of federal law are applicable. For example, in Nations v. Morris, 483 F.2d 577 (5th Cir. 1973), the Fifth Circuit held that Louisiana's Direct Action Statute was "inapplicable to causes of action based upon occurrences on artificial islands or structures on the Continental Shelf." Id at 579. The plaintiff in Nations filed suit against the comprehensive general liability insurer of his employer, claiming that his injuries were caused by the negligence of one of his employer's executive officers, an additional assured under the policy. The Nations court held that the Longshoremen's Act, 33 U.S.C. § 933(i), prohibits suits against fellow employees and that such a defense could be maintained by the employer's insurance carrier. Id. at 579. In Nations, the court highlighted the recurrent theme of Rodrigue, which requires that the term "'applicable' be read in terms of necessity — necessity to fill a significant void or gap." Nations, 483 F.2d at 585. The court concluded that the LHWCA is "a legislative island unto itself," leaving no gaps, "not even a tiny one." Id at 589.

In Continental Oil Co. v. London Steam-Ship Owners' Mutual Insurance Association, 417 F.2d 1030 (5th Cir. 1969), the Fifth Circuit determined that Louisiana's Direct Action Statute was not adopted as federal law and made applicable to an action arising out of an collision between a foreign vessel and a drilling and production fixed platform on the Outer Continental Shelf, where there was no showing that admiralty remedies were in any way incomplete, inconvenient or unavailable, either substantively or procedurally. The court's rationale follows, to wit:

[W]hile it does not offend the constitutional imperative for the uniformity of admiralty law for the Louisiana Direct Action Statute to apply to maritime cases occurring on inland waters of Louisiana, quite different considerations enter in mandatorily applying that to some — but a very select class — of cases on the Outer Continental Shelf. The class is select in the sense that it must somehow be physically-causally related to the structure ("artificial island") without which Louisiana law is as irrelevant as that of Pakistan. This has nothing to do with a so-called Louisiana interest.
Id. at 1037 (citations omitted). Finding that there were no "gaps" to fill, the Fifth Circuit found that the application of the Direct Action Statute as "surrogate" federal law was not appropriate under the circumstances. Id.

The plaintiff's citation of Moody v. McCallon Petroleum Operating Company, 37 F. Supp.2d 805 (E. D. La. 1999) (Duval, J.) is inapposite for several reasons, the most important being that it involved "platform injury," i.e., Moody slipped and fell on a fixed platform. Additionally, Judge Duval's later decision, Joyner v. Ensco Offshore Company, 2001 WL 333114 (E. D. La.), highlighted that the precise issue addressed in Moody was "whether under no circumstances can the Direct Action Statute be invoked where the OCSLA is a basis of jurisdiction." See id. at * 1 (citing Moody, 37 F. Supp.2d at 808). The issue was so framed because the matter was before the court on a motion to amend and the sole proffered justification for denial was futility of the proposed amendment. Quoting the Fifth Circuit's decision, Jamieson v. Shaw, 772 F.2d 1205 (5th Cir.), reh'g denied, 776 F.2d 1048 (5th Cir. 1985), the Moody court explained:

"We do not hold that Rule 15(a) required the district court in every case to grant leave to amend when the amended complaint states a cause of action. As noted earlier, other considerations of may justify denial in a proper case. See Union Planters, 687 F.2d at 121. However, where, as here, the only proffered justification for denial is futility, the determination that the complaint is legally sufficient and not cumulative deprives the district court of all "substantial reason" to deny leave to amend and severely restricts its discretion to do so. Dussouy, 660 F.2d at 598. In such a case, leave to amend should be freely granted. Justice requires no less. Fed.R.Civ.P. 15(a).
Moody, 37 F. Supp. at 808 ( citing Jamieson, 772 F.2d at 1208-09). Noting that there was no federal law applicable to the plaintiff's platform injury, the Moody court held that it "must apply 'surrogate federal law' which is the law of the State of Louisiana" and that "[t]o carve a portion of Louisiana law out where there is no other federal law applicable is simply illogical." Id. at 814. For those reasons, the court allowed the amendment of the complaint. Id.

The plaintiff's in the case at bar, both Jones Act seamen, were injured on a supply vessel in navigable waters, as opposed to on a platform, and their claims for personal injury are filed pursuant to the admiralty and the general maritime law. This Court cannot turn a blind eye to the Fifth Circuit's decision Continental, supra. The Continental court held that the Louisiana Direct Action Statute was not adopted federal law and made applicable to that action arising out of a collision of a foreign vessel and a drilling and production platform fixed on the Outer Continental Shelf in the Gulf of Mexico where there was no showing that admiralty remedies were in any way incomplete, inconvenient or unavailable. Continental, 417 F.2d at 1036. This Court further finds the Nations decision instructive. The Nations court also highlighted that the recurrent theme of Supreme Court precedent, Rodrigue v. Aetna Casualty Surety Co., 395 U.S. 352 (1969), which requires that the term "'applicable' be read in terms of necessity — necessity to fill a significant void or gap." Nations, 483 F.2d at 585; see also Continental, 417 F.2d at 436.

Although the statutory requirement for bringing a direct action is met in this particular case, the plaintiff's have not demonstrated that their remedies pursuant to the admiralty and general maritime law are in anyway incomplete, inconvenient or unavailable. Most notably, both Jolivette and Lavergne have specifically designated their lawsuits as admiralty and maritime claims within the meaning of Supplemental Rule 9(h).

Considering all of the aforesaid circumstances, it is difficult to discern the requisite Rule 16 "good cause" to jettison the district judge's scheduling order. Moreover, the suggestion of any prejudice is similarly elusive. The bench trial of this matter set to commence on March 8, 2004 and the February 19. 2004 pretrial conference is imminent. This Court recognizes that leave to amend should be freely granted when justice so requires. Nevertheless, the undersigned Magistrate Judge is not persuaded that justice cannot be served absent Steadfast's participation as a named defendant.

Accordingly,

IT IS ORDERED that plaintiff's' Motion for Leave to Amend to Add Insurer is DENIED.


Summaries of

Barry Graham Offshore Serv. v. WT Offshore Serv

United States District Court, E.D. Louisiana
Feb 6, 2004
CIVIL ACTION NO. 03-351, c/w 03-2077 2078, SECTION "J" (3) (E.D. La. Feb. 6, 2004)
Case details for

Barry Graham Offshore Serv. v. WT Offshore Serv

Case Details

Full title:BARRY GRAHAM OFFSHORE SERVICES, LLC VERSUS W T OFFSHORE SERVICES, INC., ET…

Court:United States District Court, E.D. Louisiana

Date published: Feb 6, 2004

Citations

CIVIL ACTION NO. 03-351, c/w 03-2077 2078, SECTION "J" (3) (E.D. La. Feb. 6, 2004)