ELEVENTH CIRCUIT COURT OF APPEALS AFFIRMS ORDER WHERE CARNIVAL CREWMEMBER COMPELLED TO ARBITRATION.

Jose Alvaro Dolmo MONTERO, Plaintiff-Appellant, v. CARNIVAL CORPORATION, d.b.a. Carnival Cruise Lines, Inc., Defendant-Appellee.

2013 WL 3490363 United States Court of Appeals, Eleventh Circuit.

No. 12-15525 | Non-Argument Calendar. | July 12, 2013.

PROCEDURAL POSTURE:

Former crewmember aboard cruise vessel brought Florida state court action against vessel owner alleging Jones Act negligence, unseaworthiness, and maintenance and cure. Vessel owner removed case and moved to compel arbitration based on arbitration provision contained in agreement representing employment contract. The United States Court for the Southern District of Florida, granted the motion and administratively closed the case, and crewmember appealed.

OVERVIEW:

Jose Montero, former crewmember aboard Carnival Corporation’s vessel, the Inspiration, appeals order granting Carnival’s motion to compel arbitration. Montero contends that the arbitration provision in his employment contract does not apply to his claims. Montero gradually developed back pain while working as a fire patrolman aboard the Inspiration. On March 18, 2010, he visited the ship’s doctor who concluded that he was no longer able to perform the duties of his job. Carnival then sent Montero to shore for further medical treatment, first in Mexico, then Miami, then Honduras, and finally Panama. In Panama, Montero was told that he needed major back surgery, which was performed on January 27, 2011. Montero filed suit against Carnival in Florida state court, asserting claims of Jones Act negligence, unseaworthiness, and maintenance and cure under maritime law. As an initial matter, Carnival contends that there is a lack of jurisdiction because the district court’s order compelling arbitration was a non-appealable interlocutory order, instead of an appealable final decision, because it did not dismiss Montero’s claims. Court found that a district court order directing that arbitration proceed and dismissing a plaintiff’s claims, with or without prejudice, is “a final decision with respect to an arbitration” that is immediately appealable. In this case, the district court’s order that compelled arbitration did not specifically state that Montero’s claims were dismissed. It did state, however, “that for administrative purposes this case is hereby CLOSED.” Even though this dispute involves the Convention, which favors arbitration, the parties’ intent controls. Montero argued that the arbitration clause terminated and became ineffective when he left the vessel ahead of schedule due to back injury. The arbitration clause in the seafarer’s agreement does not expressly state whether it survives the termination of that agreement, but the unambiguous language clearly contemplates that it does. It broadly provides that “any and all disputes,” other than certain wage disputes, “shall be referred to and finally resolved by arbitration,” and it expressly includes disputes regarding the agreement’s termination. Clearly the parties contemplated some circumstances in which the arbitration clause would survive termination of the agreement. And that makes sense because if it did not, there would be little room for the clause’s operation. Montero would have us conclude that arbitration is not required if an employee brings a claim after the employment contract terminates. But that interpretation would allow an employee to avoid arbitration entirely by either disembarking from the ship ahead of schedule or waiting until his 10-month contract expires before he brings a claim. Such an interpretation would contradict the arbitration clause’s broad language, as well as the Convention’s policy in favor of arbitration. Accordingly, we conclude that the arbitration clause did not cease to be effective when Montero disembarked the vessel ahead of schedule.

OUTCOME:

The Court of Appeals held that: Convention on the Recognition and Enforcement of Foreign Arbitral Awards applied to dispute notwithstanding the fact that suit involved seaman’s contract of employment, and the Convention incorporated Federal Arbitration Act (FAA) section rendering final decision with respect to arbitration immediately appealable; district court’s order compelling arbitration and administratively closing case was immediately appealable; arbitration clause contained in agreement did not terminate and become ineffective when seaman disembarked vessel ahead of schedule due to back injury, in determining whether arbitration could be compelled; and crewmember’s claims fell within scope of arbitration clause. Affirmed.

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FIFTH CIRCUIT HOLDS THAT AN EMPLOYER WHO ESTABLISHES A MCCORPEN DEFENSE TO MAINTENANCE AND CURE LIABILITY DOES NOT GAIN AN AFFIRMATIVE RIGHT TO RESTITUTION FOR BENEFITS PREVIOUSLY PAID.

Wallace BOUDREAUX, Plaintiff-Appellant v. TRANSOCEAN DEEPWATER, INC., Defendant-Appellee.

721 F.3d 723 United States Court of Appeals, Fifth Circuit.

No. 12-30041. | July 12, 2013.

PROCEDURAL POSTURE:

Seaman brought action against maritime employer seeking right to further maintenance and cure for back injury allegedly sustained on the job. The United States District Court for the Eastern District of Louisiana granted employer’s motion for partial summary judgment and awarded summary judgment to employer on counterclaim to recover maintenance and cure payments it had already made to seaman. Seaman appealed.

OVERVIEW:

Seaman, Wallace Boudreaux, began working for Transocean Deepwater, Inc. (“Transocean”) in January 2005. He failed to disclose serious back problems in Transocean’s pre-employment medical questionnaire, affirmatively answering “no” to several inquiries regarding any history of back trouble. Less than five months after his hire, Boudreaux claimed that he had injured his back while servicing equipment. As a consequence, Transocean paid the seaman maintenance and cure for nearly five years. In April 2008, Boudreaux filed suit against Transocean, alleging a right to further maintenance and cure, seeking punitive damages for Transocean’s alleged mishandling of past benefits, and asserting claims for Jones Act negligence and unseaworthiness. During discovery, Transocean obtained evidence of Boudreaux’s pre-employment history of back problems. Transocean filed an unopposed motion for partial summary judgment on Boudreaux’s claim for further benefits, invoking McCorpen as a defense to maintenance and cure liability. Under McCorpen, a vessel owner’s obligation to pay maintenance and cure to an injured seaman terminates upon proof that the seaman, in procuring his employment, “intentionally” and “willfully” concealed a material medical condition causally linked to the injury later sustained. The district court granted Transocean’s unopposed motion. Thereafter, Transocean filed a counterclaim to recover the maintenance and cure payments it had already made to Boudreaux. Transocean moved for summary judgment on the counterclaim, contending that its successful McCorpen defense automatically established its right to restitution under general maritime law. Prior to the district court’s ruling on the motion, Transocean and Boudreaux reached a bracketed settlement that resolved Boudreaux’s Jones Act negligence and unseaworthiness claims and left for decision only the viability of Transocean’s proposed counterclaim for restitution. Under the settlement, Boudreaux was entitled to a lesser sum of money if the court recognized the counterclaim and a greater sum if it did not. Though Transocean acknowledged that its restitution-via-McCorpen theory was novel, it urged the district court to fashion a new maritime right of action based on state law principles of fraud and unjust enrichment. The district court agreed and awarded summary judgment to Transocean on its counterclaim, albeit without accepting Transocean’s state-law theories. Boudreaux appeals. In light of the parties’ bracketed settlement, this case turns on the purely legal question of whether a Jones Act employer who has paid maintenance and cure to a seaman injured in its employ is, upon successfully establishing a McCorpen defense to further liability, automatically entitled to a judgment against the seaman for benefits already paid. Transocean made a strategic decision not to litigate this case on its facts; rather, it asks this Court to hold that any employer who establishes a McCorpen defense is automatically entitled to restitution. We decline the invitation. Today, we merely render explicit what has been implicit for many years: that once a shipowner pays maintenance and cure to the injured seaman, the payments can be recovered only by offset against the seaman’s damages award-not by an independent suit seeking affirmative recovery. The case for exercising our extraordinary power to create a new right of action has not been made. There is only the change of advocates and judges, by definition irrelevant to the settling force of past jurisprudence-always prized but a treasure in matters maritime. This against the cold reality that the sea has become no less dangerous, and the seaman no less essential to maritime commerce.

OUTCOME:

The Court of Appeals held that once a shipowner pays maintenance and cure to an injured seaman who has concealed a preexisting disability, the payments can be recovered only by offset against the seaman’s damages award, not by an independent suit seeking affirmative recovery. Reversed and rendered for employee.

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TWO GROUPS OF COSTA CONCORDIA PASSENGERS AVOIDED REMOVAL TO FEDERAL COURT UNDER THE ‘CLASS ACTION FAIRNESS ACT’ WHERE THEY NEVER FILED A SINGLE COMPLAINT NAMING 100 OR MORE PLAINTIFFS AND NEVER MOVED FOR CONSOLIDATION OR A JOINT TRIAL

PROCEDURAL POSTURE:

Two groups of passengers filed two separate actions in state court against owner of cruise ship that ran aground off coast of Italy, claiming negligence, professional negligence by ship’s architect, and intentional torts. Following removal under mass action provision of Class Action Fairness Act (CAFA), the United States District Court for the Southern District of Florida, , J., granted passengers’ motions for remand to state court. Owner appealed.

OVERVIEW:

In 2012, the Costa Concordia, ran aground off the coast of Italy. In the wake of the accident, many of the Costa Concordia’s passengers sued Appellants (collectively referred to in this opinion as “Carnival”), filing dozens of actions in forums both in the United States and around the world. This appeal concerns two separate actions in particular, filed by groups of fifty-six and forty-eight plaintiffs in the Circuit Court of the Eleventh Judicial Circuit of Florida. Carnival removed both actions to the United States District Court for the Southern District of Florida, claiming that the district court had subject-matter jurisdiction under the mass-action provision of the Class Action Fairness Act of 2005 (“CAFA”), (codified in scattered sections of 28 U.S.C.). Both groups of plaintiffs moved for remand to the state court on the ground that the district court lacked jurisdiction, and the district court granted plaintiffs’ motions in February 2013. We granted Carnival permission to appeal in order to resolve an issue of first impression in this Circuit: whether a defendant has the right, pursuant to 28 U.S.C. §§ 1332(d)(11), 1441, and 1453, to remove multiple and separate lawsuits to federal court as mass actions if the lawsuits in the aggregate contain 100 or more plaintiffs whose claims revolve around common questions of law or fact, but neither the plaintiffs nor the state court have proposed that 100 or more persons’ claims be tried jointly. Under the plain language of CAFA and § 1332(d)(11), the district court lacked subject-matter jurisdiction over the plaintiffs’ two separate actions unless they proposed to try 100 or more persons’ claims jointly. Consequently, the cases were improvidently removed and should have been remanded, and we affirm the district court’s order. The long and short of this case is that, in order for the district court to have subject-matter jurisdiction, 28 U.S.C. § 1332(d)(11)(B)(i) requires a proposal for joint trial of 100 or more persons’ claims. But the forty-eight plaintiffs in Scimone II and the fifty-six plaintiffs in Abeid-Saba never filed a single complaint naming 100 or more plaintiffs and never moved for consolidation or a joint trial on part or all of their two separate actions. In other words, they never proposed joint trial of 100 or more persons’ claims. In the face of the letter of the statute, the district court’s remand order was proper.

OUTCOME:

The Court of Appeals held that in matter of first impression, CAFA removal jurisdiction is lacking unless plaintiffs proposed to try 100 or more persons’ claims jointly. Affirmed.

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WHERE SEAMEN COULD NOT PROVE THAT DEFENDANT WAS HIS JONES ACT EMPLOYER, SUMMARY JUDGMENT ENTERED IN FAVOR OF DEFENDANT OIL COMPANY.

Michael Henry SMITH, Plaintiff-Appellant, v. BP AMERICA, INC., Defendant-Appellee.

2013 WL 3368825 United States Court of Appeals, Eleventh Circuit.

No. 12-12031 | Non-Argument Calendar. | July 5, 2013.

PROCEDURAL POSTURE:

Seaman, who was hired by contract labor business on behalf of independent contractor hired by oil company to clean up oil spill and who was allegedly injured while installing, inspecting, and maintaining floating booms, brought action against oil company alleging claims under the Jones Act, for maintenance and cure, and for unseaworthiness. The United States District Court for the Southern District of Alabama denied his motion for partial summary judgment, granted summary judgment in favor of oil company. Seaman appealed.

 

OVERVIEW:

Michael Henry Smith, proceeding pro se, appeals the district court’s order denying his motion for partial summary judgment and granting summary judgment in favor of BP America, Inc. on his Jones Act, maintenance and cure, and unseaworthiness claims. Mr. Smith also appeals the district court’s denial of his motions to compel discovery and his motion to alter or amend judgment. After the Deepwater Horizon disaster, Mr. Smith was hired by Marine Contracting Group, LLC to work as a boat hand responsible for installing, inspecting, and maintaining floating booms-temporary floating barriers used to contain an oil spill-in the waters of Orange Beach, Alabama. Marine Contracting, a contract labor business specializing in the shipyard industry, hired workers on behalf of Oil Recovery Company (“ORC”) to work on the oil spill’s cleanup efforts. On May 12, 2010, Mr. Smith was checking and deploying floating booms from a boat when he fell overboard. Mr. Smith returned to the boat and continued working without receiving medical attention. ORC fired Mr. Smith later that day for being an unsafe and problem employee. The next day, Mr. Smith sent an email to Paul Jones, the president of ORC. In the email, Mr. Smith thanked Mr. Jones for giving him a job with ORC, and also explained that he “gently slid” off the side of the boat. ORC did not rehire Mr. Smith. Mr. Smith filed a complaint against Moran Environmental Recovery, LLC and BP America, Inc. Mr. Smith asserted three claims: (1) a negligence claim under the Jones Act, see 46 U.S.C. § 30104 et seq.; (2) a claim for maintenance and cure under general maritime law; and (3) a claim for unseaworthiness under general maritime law. After a settlement with Moran, the case between Mr. Smith and BP proceeded to discovery. At the close of discovery, Mr. Smith filed a motion for partial summary judgment seeking a determination that BP was his employer. BP moved for summary judgment on all of Mr. Smith’s claims. The district court denied Mr. Smith’s motion for partial summary judgment and granted BP’s motion for summary judgment. The district court reasoned that (1) it was an undisputed fact that BP was not Mr. Smith’s employer, and so Mr. Smith could not establish an essential element of both Jones Act and maintenance and cure claims; and (2) Mr. Smith failed to establish that (a) BP owned the “jet boat” or that (b) the “jet boat’s” unseaworthy condition caused his injuries-essential elements of Mr. Smith’s seaworthiness claims. Pursuant to the Jones Act, “[a] seaman injured in the course of employment … may elect to bring a civil action at law … against the employer.” 46 U.S.C. § 30104 (2006). Furthermore, “[a] seaman’s right to maintenance and cure is implicit in the contractual relationship between the seaman and his employer, and is designed to ensure the recovery of these individuals upon injury or sickness sustained in the service of the ship.” Pelotto v. L & N Towing Co., 604 F.2d 396, 400 (5th Cir.1979). Thus, the claimant must establish the existence of an employee-employer relationship in order to recover on either claim. See, e.g., Spinks v. Chevron Oil Co., 507 F.2d 216, 224 (5th Cir.1975).3 In this case, both parties moved for summary judgment on Mr. Smith’s Jones Act and maintenance and cure claims with competing arguments regarding Mr. Smith’s employment status (or lack thereof) with BP. In determining a seaman’s employer, control is the critical inquiry. See Ruiz v. Shell Oil Co., 413 F.2d 310, 312 (5th Cir.1969). Control can often be shown by “(1) direct evidence that the [alleged] employer … exercised control over the employee; (2) evidence that the [alleged employer] was responsible for paying the employee, (3) evidence that the [alleged employer] furnished equipment necessary for performance of the works; and (4) evidence that the [alleged employer] had the right to terminate its relationship with the employee.” Langfitt v. Federal Marine Terminals, Inc., 647 F.3d 1116, 1123 (11th Cir.2011). Because employment status is an essential element to his Jones Act and maintenance and cure claims, Mr. Smith ultimately bore the burden of proving that BP was his employer. In moving for summary judgment, he was required to produce credible, uncontroverted evidence in support of his position. See United States v. Four Parcels of Real Prop. in Greene & Tuscaloosa Counties in State of Ala., 941 F.2d 1428, 1438 (11th Cir.1991). Mr. Smith was unable to meet this burden. In support of his motion for partial summary judgment, Mr. Smith submitted his own affidavit in which he asserted that he was a “seaman working on a vessel in the employ of BP” and that he was “an employee of BP in that same capacity.” Smith failed to affirmatively prove that Mr. Smith was employed by BP. The district court, therefore, properly denied Mr. Smith’s motion for partial summary judgment.

 

OUTCOME:

Affirmed.

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