Plaintiff Oceans Away from Proving Claims Against Agencies
Shaw v. United States, 2020 U.S. Dist. LEXIS 16405*, WL 496066 (N.D. Cal. 2020).
By: Shelia Tolar
In this maritime injury claim,Plaintiff Shaw filed suit against the United States, its agent, Ocean Duchess,Inc., and Ocean Shipholdings, Inc., an affiliated company with its agent. Thethree causes of action against all defendants were: (1) negligence under theJones Act[1]; (2) unseaworthiness; and(3) failure to pay maintenance, cure, and wages under maritime law.Additionally, Shaw asserted a claim of gross negligence against Ocean Duchess,Inc. and Ocean Shipholdings, Inc. The court denied the United States’ motion todismiss the claims against Ocean Duchess and Ocean Shipholdings. The courtfound that the plaintiff sufficiently invoked federal jurisdiction over the maritimeclaims against Ocean Duchess and Ocean Shipholdings because the complaintsufficiently alleged that they acted outside the scope of their agencyagreement with the United States. The United States then filed a motion forsummary judgment in favor of Ocean Duchess and Ocean Shipholdings, which thecourt granted.
Shaw, an employee by OceanDuchess at the time of the incident, was injured while working as a deckhandand engineer aboard the SS ALGOL, a vessel owned by the United States throughthe Department of Transportation, Maritime Administration (“MARAD”). As thecrew moored M/V ALGOL, a mooring line snapped and broke Shaw’s tibia, dislocatedhis knee, and injured his head, wrist, and shoulder.
Ocean Duchess operated M/V ALGOL undera ship management contract with MARAD as the vessel was part of the ReadyReserve Force in the MARAD National Defense Reserve Fleet. The ship managementcontract stated that Ocean Duchess, as the ship manager, was an agent of theUnited States for “…all third party tort actions inadmiralty cognizable including those under the Jones Act, General Maritime Law,or Clarification Act, inclusive of claims for maintenance and cure.”[2]The only instances in which Ocean Duchess would not be considered an agent ofthe United States are: (1) contract disputes and (2) non-admiralty actions. Theagreement also stated that, under the Suits in Admiralty Act (SIAA),[3]the United States is the exclusive defendant for covered admiralty casesrelated to the activities of its agents.
To determine whether agency exists forpurposes of the SIAA, Ninth Circuit courts "use the common law definitionof agency as a starting point for our analysis and will then consider therelevant case law as well as the specific provisions of the agreementbetween" the United States and the ship operator.[4]The SIAA,[5]together with the Clarification Act,[6]waive sovereign immunity of the United States in cases where "a civilaction in admiralty could be maintained" against a private person in thesame situation.[7] Shaw asserted that Ocean Duchess committedgross negligence, which falls outside the agency agreement with the UnitedStates. The court determined that there is no gross negligence exception to theagency agreement.
Ocean Shipholdings also entered intoa General Agency Agreement with MARAD. However, this agency agreement waslimited to ships assigned specifically to it by MARAD. It did not extend tovessels in the Ready Reserve Fleet, such as M/V ALGOL. While Ocean Shipholdingsis an affiliate of Ocean Duchess, they are separate and distinct corporationswith separate bank accounts and separate lines of credit. Shaw was not anemployee of Ocean Shipholdings, nor did the company’s agency agreement extendto M/V ALGOL.
Shaw amended his claim against OceanShipholdings to a general maritime claim, not a Jones Act claim. He alsoconceded that dismissal of his unseaworthiness and maintenance and cure claimswas warranted. Shaw offered no evidence that Ocean Shipholdings managed or operatedM/V ALGOL. The use of the same letterhead by Ocean Shipholdings and OceanDuchess was insufficient evidence to establish a connection between OceanShipholdings and M/V ALGOL. Therefore, Shaw failed to raise a triable issue offact as to whether Ocean Shipholdings owed him a duty of care.
To support the general maritimeclaim against Ocean Shipholdings, Shaw need to show only the "slightestcausal connection between the defendant's conduct and the plaintiff's injury."[8]Even under this standard, Shaw failed to present evidence of causation againstOcean Shipholdings to support a negligence or gross negligence claim. Evenviewing the evidence in the light most favorable to Shaw, the cause of theaccident was attributable to the operator of the vessel, Ocean Duchess, notOcean Shipholdings.
Because there was no general issueof material fact in Shaw’s claims against Ocean Shipholdings, it was entitledto summary judgment. Because this was an admiralty action and Ocean Duchess wasan agent of the United States, Ocean Duchess was also entitled to summaryjudgment. The United States was the only proper party in the suit.
[1]46 U.S.C. § 30104.
[2]Shaw v. United States, 2020 U.S. Dist. LEXIS 16405, at *10 (N.D. Cal. Jan. 30,2020)
[3]46 U.S.C. § 30903 et seq.
[4]Dearborn v. Mar Ship Operations, Inc., 113 F.3d 995, 997 (9th Cir. 1997).
[5]Supra, note 3.
[6]50 U.S.C. §§ 4701-4705
[7]46 U.S.C. § 30903(a).
[8]The Dutra Group v. Batterton, 139 S.Ct. 2275, 2292 n.8, 204 L. Ed. 2d 692(2019) (Ginsburg, J., dissenting).
