Under LHWCA, State Law Controls Allocation of Fault to Non-Maritime Third Party

In Jowers v. Lincoln Elec. Co., — F.3d —-, 2010 WL 3341651 (5th Cir. 2010), Plaintiff, a supervisor and foreman for Ingalls, a shipbuilding contractor, instituted in  the United States District Court for the Southern District of Mississippi a products liability action under Mississippi law.  Plaintiff alleged that the welding consumables he used during his career emited fumes containing manganese, which could cause serious neurological diseases.  Prior to the lawsuit, two neurologists diagnosed Plaintiff with manganese-induced Parkinsonism.  At the trial, the court awarded Jowers $1,200,000 in compensatory damages and $1,700,000 in punitive damages, but the compensatory portion of the award was reduced by 40% to take into account the Plaintiff’s own fault.  Although the Fifth Circuit addressed multiple issues on appeal, such as the government contractor defense and evidentiary rules, the court’s statements regarding allocationof fault and the Longshore and Harbor Workers’ Compensation Act (“LHWCA”) are most important for our purposes.

The LHWCA provides workers compensation to qualified beneficiaries, and in return “a person who receives LHWCA benefits may not sue his employer under state law for any additional compensatory damages related to his on-the-job injury.”  See Jowers at *7; 33 U.S.C. §§ 905(a), 933(i).  An injured employee can, however, sue a third party for damages related to the injury.  Here, the defendant welding rod manufacturers argued that the lower court erred when it refused to permit the jury to apportion fault to Ingalls.

A prior Fifth Circuit case, Fontenot v. Dual Drilling Co., 179 F.3d 969 (5th Cir. 1999) stated that the “allocation of fault between an employer and third-party dependent depends on ‘whether the third party…is a vessel or is a non-maritime entity.”  Jowers, at *8, quoting Fontentot, 179 F.3d at 974.  If the third party is a vessel then an employee can sue the third party based on negligence and the employer shall not be liable to the vessel for damages.  If the third party is a “non-maritime entity,” which the Fifth Circuit parenthetically defined as “anything other than a ‘vessel'”, then the employee’s claim against the third party is dependent upon the relevant State’s laws regarding allocation of fault.  In Mississippi, liability may be apportioned not only to settling defendants, but also to immune defendants.  See Jowers at *8.

Despite its immunity, the Fifth Circuit determined that Ingalls could still have fault allocated to it.  The Fifth Circuit vacated the jury’s award of damages and remanded the case “for a new trial on damages awards that includes a jury instruction permitting allocation of fault to Ingalls.”

Jowers v. Lincoln Elec. Co., — F.3d —-, 2010 WL 3341651 (5th Cir. 2010).