Opinion
CIVIL ACTION NO. 01-3187 (REF: ALL CASES), SECTION "L"(4).
June 6, 2003.
ORDER REASONS
Limitation claimants Claude Banks, Alan Dabney, Jadi Steward, and Daryl Billington (hereinafter "personal injury claimants") have entered into a stipulation agreeing to be bound by this Court's determination of limitation and now move this Court to lift its monition prohibiting claims against petitioners in state court proceedings. Finding that all claimants in this matter have not joined in the proposed stipulation, the Court rejects the stipulation and denies the personal injury claimants' request to lift the stay.
I. FACTS
This case arises out of an alleged collision in the Mississippi River on September 17, 2000 between the M/V MISS ALLY, owned and operated by petitioner/claimant Crescent Ship Service, Inc. ("Crescent"), and the M/V WANDA LEE, a vessel owned by petitioner/claimant Dixieland Tow Boat Management, Inc., ("Dixieland") and operated by petitioner/claimant Lynchburg Shipyard ("Lynchburg"). On October 22, 2001, Dixieland and Lynchburg filed in this Court a petition for exoneration from or limitation of liability pursuant to the Limitation of Liability Act, 46 U.S.C. App. § 183, et seq. The action was docketed as Civil Action Number 01-3187. At the time the complaint was filed, this Court issued an order restraining prosecution of claims in any other forum against the petitioners arising out of the incident on September 17, 2000. The Court further ordered that all parties asserting claims against Lynchburg and Dixieland file their claims in this Court no later than January 7, 2002.
Prior to that date, claims were filed in this Court by claimants Claude Banks ("Banks"), Alan Dabney ("Dabney"), Jadi Steward ("Steward"), Arthur Gillum ("Gillum"), David Gordon ("Gordon"), and Daryl Billington ("Billington"). These individuals alleged that they were longshoremen who suffered personal injuries as a result of the collision between the WANDA LEE and the MISS ALLY. Crescent also filed a claim in Lynchburg/Dixieland's limitation proceeding asserting that it is entitled to indemnity and contribution from the petitioners for its potential liability resulting from the collision. Finally, the Louisiana Insurance Guaranty Association ("LIGA") intervened in the action as the Longshore and Harbor Workers' Compensation Act carrier for claimants Banks, Gillum, and Dabney.
On February 21, 2002, Crescent, as owner of the MISS ALLY, also filed a petition for exoneration from or limitation of liability for the incident on September 17, 2000. That action was docketed Civil Action Number 02-484 and was consolidated for trial with Civil Action Number 01-3187. As in the Lynchburg action, the Court issued a stay of all other proceedings against Crescent and directed all claimants to file claims in this Court. Banks, Dabney, Steward, Gillum, Gordon, and Billington filed claims against Crescent, and Lynchburg and Dixieland also filed a claim against Crescent asserting their right to contribution and/or indemnity. LIGA also intervened as to claimants Banks, Gillum, and Dabney.
Trial in this consolidated proceeding is set for Monday, June 9, 2003. Prior to the final pretrial conference in this matter, the parties settled all claims of David Gordon. At the time of the pretrial conference, claimants Banks, Dabney, Steward, and Billington advised the Court that they would contest this Court's jurisdiction to determine issues of damages in the event that limitation was denied. Gillum, however, declared his intent to have all issues tried in this proceeding. Thereafter, on Wednesday, June 4, 2003, the United States Magistrate Judge assigned to this matter entered a Minute Entry noting that Gillum's claims against the petitioners had been resolved. The following day, on Thursday, June 5, 2003, one "working day" before trial, the remaining individual claimants (Banks, Dabney, Steward, and Billington) filed the stipulation that is the subject of this opinion.
Following receipt of the personal injury claimants' motion, the Court convened a telephone with the parties. At the conference, Lynchburg, Dixieland, and Crescent advised the Court that they opposed the motion. The Court requested written oppositions be filed by Friday, June 6. In their written opposition, Lynchburg, Dixieland, and Crescent assert the following arguments: (1) not all claimants have agreed to the stipulation as Lynchburg/Dixieland, Crescent, and LIGA have filed claims in these limitation proceedings; (2) the stipulation is inadequate because it does not provide that the funds will be paid from the limitation fund on a pro rata basis; and (3) the proposed stipulation comes too late because the parties have incurred considerable expense in preparing for a trial date that is three calendar days away. Having considered the arguments of the parties and the applicable law, the Court now rules on the claimants' request.
II. ANALYSIS
Resolution of this issue requires discussion of the tension between the Limitation of Liability Act and the "Savings to Suitors Clause" of 28 U.S.C. § 1333, which gives federal district courts original and exclusive jurisdiction of "[a]ny civil case of admiralty or maritime jurisdiction, saving to suitors in all cases other remedies to which they are otherwise entitled." 28 U.S.C. § 1333(1). The United States Supreme Court recently described the tension between these statutes in Lewis v. Lewis Clark Marine, Inc., 531 U.S. 438 (2001), when it noted that "[o]ne statute gives suitors the right to a choice of remedies, and the other statute gives vessel owners the right to seek limitation of liability in federal court." Id. at 448. The Court also noted that in some instances district courts have jurisdiction to lift the stay to allow suitors to pursue state court remedies if it is satisfied that the petitioner's right to seek limitation is protected. Id. at 454.
The Fifth Circuit has also identified the appropriate circumstances in which a district court should lift the stay to allow claimants to proceed in state court. In Odeco Oil and Gas Co. v. Bonnette, 74 F.3d 671 (5th Cir. 1996), the court held that a district court "must allow" state court actions to proceed: "(I) when the total amount of the claims does not exceed the shipowner's declared value of the vessel and its freight, and (2) when all claimants stipulate that the federal court has exclusive jurisdiction over the limitation proceeding, and that the claimants will not seek to enforce a damage award greater than the value of the ship . . . until the shipowner's right to limitation has been determined." Id. at 674. See also, Texaco, Inc. v. Williams, 47 F.3d 765, 768 (5th Cir. 1995); In re Port Arthur Towing Co., 42 F.3d 312, 316 (5th Cir. 1995).
The issue before this Court is whether all the claimants have agreed to the stipulations. In Odeco, the court inquired whether the definition of claimants under the Limitation of Liability Act included parties seeking contribution and answered that question in the affirmative. See Odeco, 74 F.3d at 675 ("Codefendant cross-claims for indemnity and contribution are liabilities that must be addressed in order to protect the shipowner's rights under the Limitation Act. Therefore, parties seeking indemnification and contribution from a shipowner must be considered claimants within the meaning of the Limitation Act.").
Notwithstanding such language, the personal injury claimants contend that their stipulations protect the petitioner's rights to seek limitation in this Court because the parties seeking contribution or indemnification are the petitioners and they need not join in the stipulation. The Court finds their argument unavailing. The facts of the instant case are analogous to the facts before the Fifth Circuit in In re Port Arthur Towing Co., 42 F.3d 312 (5th Cir. 1995). In Port Arthur, the owners of two vessels, JWT and PATCO had filed separate limitation complaints following a collision between their vessels. JWT also cross-claimed against PATCO seeking indemnification, court costs, and attorneys' fees. Thereafter, two individual claimants moved to lift the stay to allow them to proceed in state court against the vessel owners, but JWT refused to join in the stipulations. The district court denied the motion since all parties had not agreed to the stipulation. On appeal, the Fifth Circuit affirmed the district court finding that JWT's absence from the stipulation prejudiced PATCO's right to seek limitation before the district court. Id. at 316. Thus, the district court did not abuse its discretion in denying the motion to lift the stay; in fact, the court concluded that where all the claimants had not agreed to lift the stay, the district court would have abused its discretion had it done so. Id.
The Court also notes that the Fifth Circuit later distinguished Port Arthur in In re Tidewater, 249 F.3d 342 (5th Cir. 2001). In that case, also involving consolidated limitation proceedings, the court concluded that since the personal injury claimants only sought to proceed in state court only against Tidewater, one of the two petitioners, Tidewater did not need to agree to the stipulation despite the fact that it was a claimant in the other limitation proceeding. Id. at 347-48. The court rejected Tidewater's reliance on Port Arthur, noting that in that case the "Court affirmed the district court's decision to deny lifting of the stay where a limitation plaintiff was also a claimant in the proceeding with the stay at issue." Id. at 347. Based on this language, the instant case before this Court is more similar to Port Arthur than Tidewater, and lifting the stay is not permitted without the consent of all the claimants.
When applied to the instant case, the result is clear. Lynchburg/Dixieland Crescent are claimants within the meaning of the Limitation of Liability Act. As such, they must join in the stipulations in order for this Court to lift the stay. Since they have not done so, this Court finds that it would be an abuse of discretion to lift the stay. As the Court has determined that the stay cannot be lifted at this time, it need not address the issues of the adequacy of the stipulations or prejudice to the petitioners by lifting the stay only days before the scheduled start of trial in this case.
III. CONCLUSION
For the foregoing reasons, the Court rejects the claimants' proposed stipulations and denies their request to lift the stay.