The split within the sections of the Eastern District over the availability of punitive damages in favor of Jones Act seamen against non-employer third parties widened in March when Judge Zainey permitted plaintiffs to bring such a cause of action against a non-employer vessel owner in Hume v Consolidated Grain & Barge, 2016 WL 1089349 (E.D. La. 3/21/16). Judge Zainey, like Judge Fallon before him, opined that the Fifth Circuit’s precedent on this issue in Scarborough v. Clemco Industries, 391 F.3d 660 (5th Cir. 2004), has been “effectively overruled” by the Supreme Court’s decision in Atlantic Sounding v. Townsend, 557 U.S. 404 (2009). In his Order and Reasons, however, Judge Zainey also noted the decision in Howard v. Offshore Liftboats, LLC, 2015 WL 7428581 (E.D. La. 11/20/15), wherein an opposite conclusion was reached by Judge Morgan. It order to understand the current split within the District on this issue, an overview of the recoverability of nonpecuniary damages by Jones Act seamen is necessary.
In Miles v. Apex Marine Corp., 498 U.S. 19 (1990), the mother of a seaman killed by a fellow crewmember brought suit against the vessel owner for negligence under the Jones Act and unseaworthiness under the general maritime law. The issue presented to the Supreme Court was the scope of damages permitted under the general maritime law, specifically whether the GML allowed for the recovery of loss of society in a wrongful death claim or loss of future income in a survival action. To address the issue, the Court looked to the policy choices expressed by Congress as reflected in statutes creating closely related claims, DOHSA and the Jones Act. The Court noted that DOHSA, by its own terms, limits recoverable damages in wrongful death suits to pecuniary losses. The Court then held that even though the Jones Act does not limit the types of damages that may be recoverable, it forecloses the availability of non-pecuniary damages because the Jones Act adopted the Federal Employers Liability Act (“FELA”) as the predicate for liability and damages. Although the explicit language of FELA does not preclude non-pecuniary damages, the Court relied upon Michigan Central .R. Co v. Vreeland, 227 U.S. 59 (1913), which held that the legislative intent behind FELA was to permit the recovery for only pecuniary damages. Miles thus “restore[d] a uniform rule [of recovery of only pecuniary damages] applicable to all actions for the wrongful death of a seaman, whether under DOHSA, the Jones Act, or the general maritime law.”
In 1996, in Guevara v. Maritime Overseas Corp., 59 F.3d 1496 (5th Cir. 1996), the Fifth Circuit was confronted with the issue of whether a seaman may still recover punitive damages for a vessel owner’s failure to pay maintenance and cure in light of the holding in Miles. Sitting en banc, the Fifth Circuit noted that actions under the general maritime law for personal injury are subject to the Miles uniformity principle. The court went on to hold that because a tort based maintenance and cure claim involves personal injury, and non pecuniary damages are not available for personal injury under the Jones Act, the Miles uniformity principle requires that punitive damages be precluded under a general maritime law action for maintenance and cure.
Eight years later, the Fifth Circuit addressed the issue of whether the Miles uniformity principle prevents the recovery of nonpecuniary damages in a suit brought by a Jones Act seaman or his survivors against a non employer third party. In Scarborough v. Clemenco Industries, 391 F.3d 660 (5th Cir 2004), the original plaintiff was found to be a Jones Act seaman injured by the negligence of his employer and third party manufacturers of vessel equipment. The original plaintiff later died and his survivors brought a wrongful death claim seeking non pecuniary damages. The plaintiffs argued that the uniformity principle in Miles was inapplicable in a cause of action against a non employer third party because the remedies of the Jones Act were not triggered and thus were not meant to limit recoverable damages. The Scarborough court rejected this argument. Instead, using its framework established in Guevara, the court found that “[t]he facts of this case are analogous to causes of action brought pursuant to the Jones Act. It would be improper for this court to allow [plaintiff] to recover nonpecuniary damages in this case when Congress disallowed the recovery of identical damages in a Jones Act suit. The genesis of [plaintiff’s] claims is maritime through and trough. Miles plainly limits recovery to pecuniary damages. We will not retreat from the bright line directive of Miles.”
The uniform principle asserted in Miles was revisited by the Supreme Court in Atlantic Sounding v. Townsend, supra. In Townsend, a seaman injured on a tugboat sought to recover punitive damages when his employer failed to provide maintenance and cure. In holding that punitive damages were recoverable, the Court distinguished Miles, noting that it did not address a maintenance and cure claim and further, that the general maritime law providing for punitive damages in a maintenance and cure claim was well established before the passage of the Jones Act and was not addressed by the Jones Act. The Court criticized the expansive reading of Miles by the lower courts and stated that “a laudable quest for uniformity does not require narrowing of damages to the lowest common denominator approved by Congress for distinct causes of action.” The Court reasoned that causes of action based on negligence, unseaworthiness, and maintenance and cure have been derived from different origins and therefore may on occasion warrant the application of slightly different principles and procedures. Thus, the Court noted that its holding that a seaman may be entitled to recover punitive damages from an employer who fails to provide maintenance and cure does not overrule the Miles’ reasoning that a cause of action brought under the Jones Act or the general maritime law unseaworthiness precludes a remedy for non pecuniary damages.
There is no question that Townsend overruled Guevara. The question causing the split in the sections of the Eastern District is whether Townsend also overruled Scarborough, which employed Guevara’s framework in reaching its conclusion that a seaman may not recover non pecuniary damages from a non employer third party. In Collins v. A.B.C. Marine Towing, supra, the survivor of a Jones Act seaman brought punitive damages claims based on gross negligence against the owner/operator of a bridge, a non employer third party. The bridge operator filed a motion to dismiss under Rule 12(b)(6), arguing that punitive damages are not recoverable as a matter of law. Judge Fallon denied the motion, reasoning that because Townsend expressly abrogated Guerva, Scarborough has been effectively overruled. Judge Fallon held that when the Jones Act is not implicated, a claim under general maritime law for punitive damages is available to maritime plaintiffs against non-employer third parties. The reasoning in Collins was followed by Judge Zainey in Hume, where a cause of action was found to exit in favor of a Jones Act seaman for punitive damages under the general maritime law against a non employer vessel owner.
The opposite result was reached, however, by Judge Morgan in Howard v. Offshore Liftboats, LLC, 2015 WL 7428581 (E.D. La. 11/20/15). In Howard, the plaintiffs were Jones Act seamen injured in a personnel basket transfer who sued a non employer third party under the GML for punitive damages. A motion to dismiss the punitive damages claim was filed under Rule 12(b)(6), which was granted. Judge Morgan noted that the Townsend decision “took pains to distinguish maintenance and cure, for which it concluded punitive damages are available, from seaman’s remedies for negligence and unseaworthiness, for which punitive damages are generally not available under Miles [and] Scarborough …” and further that “the Fifth Circuit’s decision is Scarborough … is binding on this Court and has never been overruled.”
Written by: Jason Waguespack, Vice-Chair of the Maritime & International Law Committee