The U.S. Eastern District of Louisiana recently dismissed three injured longshore workers’ lawsuits against a vessel owner and charterer for failure to timely file claims in a limitation action. Judge Jane Triche Milazzo handed down the same ruling in both claims.
- Collins v. Double J Marine, LLC, No. 19-1415, 2019 U.S. Dist. Lexis 117099 (E.D. La. July 15, 2019)
- Payne v. Double J Marine, LLC, No. 19-1417, 2019 U.S. Dist. Lexis 117104 (E.D. La. July 15, 2019) (Milazzo)
On February 16, 2016, Defendants’ vessel, the M/V MISS SYLVIA, collided with the M/V ATLANTIC GRACE, which was moored on navigable waters in Plaquemines Parish, Louisiana. Defendants filed a limitation action on July 21, 2016, seeking exoneration from liability related to the collision, or, alternatively, seeking to limit any liability they may incur to the value of the M/V MISS SYLVIA.
In an order issued on July 27, 2016, the Court instructed the Clerk of Court to issue a notice that all claims related to the limitation action must be filed on or before September 23, 2016, or they would be defaulted. The order further required that the notice be published once a week for four successive weeks in a newspaper of general circulation published in Louisiana. Defendants published the notice in the New Orleans Times-Picayune.
On May 23, 2017, the Court issued an order defaulting all persons claiming any injuries from the collision who had not filed a claim in the limitation action. All claims that were filed in the limitation action were eventually resolved, and the action was dismissed on November 26, 2018.
Over two years after the limitation action was filed, on February 14, 2019, Plaintiffs Roosevelt Collins, and Cary Payne and Jerome Davis, brought suit against Defendants, alleging that they were performing cargo operations for their employer on the M/V ATLANTIC GRACE at the time of the collision and sustained injuries as a result thereof. In response, Defendants filed a Motion to Dismiss the suits as time barred for failing to timely file in the limitation action.
The Defense’s Arguments
Defendants argued that allowing Plaintiffs to bring claims after the limitation action was dismissed would adversely affect Defendants in several ways, including forcing Defendants to litigate issues that they had chosen to resolve through settlement; exposing Defendants to unforeseen liability that was considered in reaching the settlement; and preventing Defendants from seeking contribution from third parties because of the terms of the settlement.
In support of their position, Defendants cited an Eastern District of Louisiana case, In re Global Industries Offshore, 2000 WL 1610384 (E.D. La. Oct. 26, 2000), where Judge Carl Barbier held that the limitation petitioner had no notice that the plaintiff was injured in the collision and that it complied with Supplemental Admiralty Rule F(4) by giving actual notice to those who had asserted a claim and by publishing notice in the local newspaper. Without any showing of bad faith on the part of the limitation petitioner, Judge Barbier denied the plaintiff’s request to file a late claim. Id.
The Plaintiffs’ Arguments
In response, Plaintiffs argued that they were never notified of the limitation action. They contended that they obtained counsel immediately after the collision, notified their employer, filed workers’ compensation claims, and asserted that discovery obtained by Defendants in the limitation action should have placed them on notice that the workers were potential claimants.
The Court’s Findings and Decision
Under Supplemental Admiralty Rule F, a district court has discretion to allow a party to file a claim in a limitation proceeding after the claims bar date has passed. However, the Fifth Circuit has held that relief from a late claim is not a matter of right. Texas Gulf Sulphur Co. v. Blue Stack Towing Co., 313 F.2d 359, 363. (5th Cir. 1963). Permission to file late claims will only be granted when the limitation proceeding is pending and undetermined, and upon an equitable showing that the rights of the parties will not be adversely affected by the late claim. Id.at 362-363.
Judge Milazzo rejected Plaintiffs’ arguments because Rule F(4) only requires that notice be given to all persons asserting claims and that notice to others be published in a newspaper as the court may direct. Defendants were not aware of Plaintiffs’ injuries or claims, and they complied with the publication required. Judge Milazzo noted that the record was void of any suggestion that Defendants acted in bad faith. Further, because the action had already been settled, allowing Plaintiffs’ claims to proceed would prejudice Defendants. Accordingly, Judge Milazzo dismissed Plaintiff’s claims with prejudice.