Opinion
Case No. 17-CV-2087
2020-07-27
Ryan HODGES, Plaintiff, v. ARCHER DANIELS MIDLAND COMPANY, Schlumberger N.V. (Schlumberger Limited), and Schlumberger Carbon Services, a division of Schlumberger Technology Corporation, Defendants. Archer-Daniels-Midland Company, Defendant/Third-Party Plaintiff v. Pioneer Oil Field Services, LLC, Third-Party Defendant Schlumberger N.V., et al., Defendants/Crossclaim Plaintiffs, v. Pioneer Oil Field Services, LLC, Crossclaim Defendant.
Jack A. Strellis, Strellis & Field Chartered, Waterloo, IL, Gregg E. Strellis, Strellis & Field, Chicago, IL, for Plaintiff. Michael P. Mayer, Anthony Matthew Durkin, Jeffrey John Huelskamp, Melanie Laiyee Lee, Winston & Strawn LLP, Chicago, IL, for Defendants. Michael P. Mayer, Winston & Strawn LLP, Chicago, IL, for Third-Party Plaintiff/Crossclaim Plaintiffs. John P. Cunningham, Denise Baker-Seal, Brown & James PC, Belleville, IL, for Third Party Defendant/Crossclaim Defendant.
Jack A. Strellis, Strellis & Field Chartered, Waterloo, IL, Gregg E. Strellis, Strellis & Field, Chicago, IL, for Plaintiff.
Michael P. Mayer, Anthony Matthew Durkin, Jeffrey John Huelskamp, Melanie Laiyee Lee, Winston & Strawn LLP, Chicago, IL, for Defendants.
Michael P. Mayer, Winston & Strawn LLP, Chicago, IL, for Third-Party Plaintiff/Crossclaim Plaintiffs.
John P. Cunningham, Denise Baker-Seal, Brown & James PC, Belleville, IL, for Third Party Defendant/Crossclaim Defendant.
ORDER
COLIN S. BRUCE, U.S. DISTRICT JUDGE Plaintiff, Ryan Hodges, filed an Amended Complaint (#13) on May 22, 2017, alleging negligence against Defendants Archer Daniels Midland Company ("ADM"), Schlumberger N.V. ("Schlumberger Limited"), and Schlumberger Carbon Services ("Schlumberger Carbon") for injuries he received on a work site in 2015. Defendants filed a Motion for Summary Judgment (#70) on March 6, 2020, to which Plaintiff filed a Response (#76) on April 13, 2020. Defendants filed a Reply (#78) on April 27, 2020. For the following reasons, Defendants’ Motion for Summary Judgment (#70) is GRANTED in part and DENIED in part.
The background facts are taken from Defendants’ Undisputed Statement of Material Facts in Defendants’ motion, Plaintiff's Additional Facts in his Response, and the exhibits attached by the parties to their filings.
The ICCS Project
Defendant ADM is an American global food processing and commodities trading corporation. In 2010, ADM entered into an agreement with the U.S. Department of Energy for the "Industrial Carbon Capture and Storage Project" ("ICCS Project"). The ICCS Project would be a collaboration between ADM and the Department of Energy to capture carbon dioxide generated by the operations of ADM's biofuel plant in Decatur, Illinois, and to sequester the carbon dioxide deep underground through the use of an injection well. The ICCS Project involved the building of surface facilities by ADM to capture and compress the carbon dioxide, as well as the design and construction of a subsurface well into which the captured carbon dioxide would be stored. Eric Berlin, Well Site Safety Representative for Schlumberger Carbon, testified that ADM owned the site of the project.
The Contract Between ADM and Schlumberger Carbon
On December 23, 2010, ADM signed and executed an agreement ("Subaward Agreement") with Schlumberger Carbon for performance related to the ICCS Project. Pioneer Oil Field Services, LLC, ("Pioneer"), the employer of Plaintiff Ryan Hodges, is not a signatory to the Subaward Agreement. Throughout the Subaward Agreement, "Subawardee" refers to Schlumberger Carbon, and lists Schlumberger Carbon as an independent contractor. Section 3.3 of the Subaward Agreement, entitled "Progress Reporting," states that Schlumberger Carbon "is responsible and shall submit regular progress reports to ADM on [Schlumberger Carbon's] Scope of Work ..." "Article I - Scope of Work" states that Schlumberger Carbon "shall furnish the necessary personnel, materials, services, facilities, and equipment, and otherwise do all things necessary for the performance of the work detailed ..." "Article XII - Standards of Work" states that work "shall conform to high professional and/or academic standards and/or Good Industry Standard Practice ..."
The Contract Between Schlumberger Carbon and Pioneer
In August 2012 Schlumberger Carbon and Pioneer entered into an "International Association of Drilling Contractors Model Turnkey Contract" ("Turnkey Contract") through which Pioneer would drill a well at the ICCS Project site in exchange for payment by Schlumberger Carbon. According to the University of Texas's Petroleum Extension Service's A Dictionary for the Oil and Gas Industry , a "turnkey contract" is defined as when "the contractor furnishes all materials and labor and controls the entire drilling operation, independent of operator supervision."
The Turnkey Contract between Schlumberger Carbon and Pioneer stated that "[Schlumberger Carbon] engages [Pioneer] as an independent contractor to drill the hereinafter designated well." Further, the Turnkey Contract provides that "[Pioneer] shall furnish equipment, labor, and perform services as herein provided to drill a well," and that it "shall direct, supervise and control drilling operations and assumes certain liabilities to the extent specifically provided herein."
Pioneer also agreed to assume sole responsibility for employee and equipment safety. Section 18.14.8 of the Turnkey Contract stated:
[Pioneer] is an independent contractor set forth in this agreement, and directly controls the physical work site defined as the drilling rig and regulated equipment required to perform the work under this Agreement and the physical area which bounds this equipment and this work conducted under this agreement. [Pioneer] is responsible for providing and maintaining a safe and healthful work environment for all personnel at the work site. All personnel at the work site are required to comply with [Pioneer's] efforts to provide and maintain a safe and healthful work environment at the work site and to coordinate all work at the work site with [Pioneer].
The Turnkey Contract outlines the safety program and equipment that Pioneer must maintain on the work site; requires Pioneer's personnel to be trained and qualified according to industry standards; provides Schlumberger Carbon with the "right, but not the obligation, to periodically inspect [Pioneer's] operations and the work site"; provides Schlumberger Carbon with the right to notify Pioneer if it fails to comply with safety regulations and directs Pioneer to correct them; and finally, provides Schlumberger Carbon with the right to stop all work should Pioneer not correct the safety issues.
Schlumberger Limited's Position
Defendant Schlumberger Limited is the parent company of Defendant Schlumberger Carbon. Schlumberger Limited was not a signatory to either the Subaward Agreement or the Turnkey Contract between Pioneer and Schlumberger Carbon.
ADM's Responsibilities On Site
During the relevant period, ADM employee Scott McDonald served as the Project Manager on the ICCS Project. McDonald testified that ADM is not a construction contractor, nor does it have any experience with drilling oil or gas wells. Thus, in executing the ICCS Project, ADM contracted with subject matter experts on specific areas of the project. ADM had no control or supervisory authority over how Pioneer hired or trained its employees. ADM did not have any control or supervisory authority over how Pioneer selected, maintained, repaired, or replaced its equipment, including the hoses to be used on the mud pumps, in connection with drilling the ICCS well. ADM had no control or supervisory authority over Pioneer's drilling process used to drill the ICCS well, but ADM did have supervisory power to cause accurate reporting of work site conditions to be included in daily reports.
ADM did not have such control or supervisory authority, according to McDonald, because it did not have expertise in drilling wells or the equipment used to drill wells, and it relied upon its contractors to provide ADM with that expertise. Other non-ADM employees on site confirmed that ADM did not direct the drilling work or have a regular role in safety with respect to operating the drilling equipment.
In a document entitled "ADM Concerns," in answer to a question of who were the responsible personnel/contractors for the supply of equipment, materials, plans and procedures, the document states "Wellsite responsibility resides with Well Site Supervisor Merl Richards supported by Schlumberger Drilling Engineer Russell Wagstaff. Final responsibility resides with Jim Kirksey Carbon Services Well Engineering Manager in consultation with John Medler SCS ICCS Project Manager[.]" After the word "Manager," someone, it is not identified by the parties who it was, drew an arrow and wrote in "Flow down to Pioneer."
Schlumberger Carbon's Responsibilities On Site
At the time of the incident, Schlumberger Carbon employee John Medler served as a Project Manager on the ICCS Project. According to Medler, Schlumberger Carbon was not responsible for helping Pioneer fix its equipment, nor was it responsible for becoming an expert in Pioneer equipment.
At the time of the incident, Russell Wagstaff, a Schlumberger Carbon employee, served as a Drilling Engineer on the ICCS Project. According to Wagstaff, no one from Schlumberger Carbon had responsibility over operating, inspecting, or maintaining Pioneer's mud pump equipment.
At the time of the incident, Schlumberger Carbon employee James Kirksey served as Engineering Manager on the ICCS Project. According to Kirksey, Schlumberger Carbon had no responsibility for operating, maintaining, inspecting, or repairing Pioneer's equipment.
Schlumberger Carbon employee Nicholas Malkewicz was a Project Manager under Medler on the ICCS Project. According to Malkewicz, Schlumberger Carbon had no experience or expertise with Pioneer's drilling equipment.
Richards Energy Services employee Merl Richards served as an independent contractor for Schlumberger Carbon, and was responsible for collecting data and pricing on the ICCS Project. Richards had no responsibility for operating, maintaining, inspecting, or repairing Pioneer's equipment.
At the time of the incident, New Tech Global contractors Eric Berlin and Scott Ramsey worked on the ICCS Project as health, safety, and environmental coordinators. Ramsey and Berlin's role on the ICCS Project was limited to facilitating communications between the various vendors and promoting safety awareness in an advisory role. Berlin and Ramsey lacked any expertise and knowledge of Pioneer's equipment.
Health and Safety on the Work Site
General Health and Safety
Schlumberger Carbon Project Manager Medler testified that the responsibility for health, safety, and "environmental" was the responsibility of all parties on the job. The responsibility was to notice unsafe conditions and, if found, to bring them to the attention of the person who was responsible.
ADM Project Manager McDonald testified that Schlumberger Carbon had responsibility for some of the safety aspects of the job as well as their subcontractors. ADM did order safety updates to be presented to it so it could manage safety from a corporation perspective, from a project manager perspective, and monitor what was happening with the project. McDonald testified that safety was a high priority and something that ADM would "look at."
McDonald stated if he saw something unsafe, he would talk to Schlumberger Carbon, and they would talk to Pioneer, and "it would be addressed." McDonald testified that Merl Richards, Schlumberger Carbon's independent contractor, produced daily reports on activities at the work site for Schlumberger Carbon. Richards testified that he was collecting all the data and pricing and reporting what had happened in the previous 24 hours every morning.
Pioneer employee Sonny McCulley testified that all parties (ADM, Schlumberger Carbon, and Pioneer) had an obligation to provide a safe work environment.
HSE Bridging Document
The Illinois Industrial Carbon Capture and Storage Project CCS#2 Well Construction HSE Bridging Document ("HSE Bridging Document"), dated January 5, 2015, was meant to "integrate the [Health, Safety, and Environment] management systems of ADM, Schlumberger, and [Pioneer]." This was "particularly critical for the management of activities." According to the HSE Bridging Document, ADM had "overall control of and responsibility of the Carbon Capture and Storage well construction," which meant "permitting, drilling, well services, logistics, transportation, communications, HSE" and it was "responsible for giving overall direction to the project." Schlumberger Carbon, according to the HSE was responsible for the day-to-day supervision of drilling operations, service providers, logistics, administration of services, and execution of operations. Pioneer was responsible for providing the rig, including crew, medical first aid kits for rig personnel, and rig HSE management system.
The HSE Bridging Document also provided for the roles and responsibilities of the respective management teams on the rig. The ADM and Schlumberger Carbon Project Managers were responsible for giving overall direction to the project, and were the interface between ADM/Schlumberger Carbon and the drilling operations team.
Kirksey, Schlumberger Carbon's Well Engineering Manager, agreed that the HSE Bridging Document related to an understanding of what the responsibilities of the various participants in the drilling were with reference to safety. Medler testified that the document "combines the health, safety and environmental policies and procedures of a number of the contractors involved in the project." Wagstaff testified that the document's purpose was to "establish whose safety policies will rule for certain situations on a project."
Under the HSE Bridging Document, Schlumberger Carbon's Well Site Supervisor (WSS) had overall responsibility for the day-to-day drilling operations. The WSS was accountable to Schlumberger Carbon's Well Engineering Manager, and received direction and input from ADM's Project Director. The primary duty of the WSS was to ensure that drilling operations were conducted in a safe, environmentally responsible, and cost effective manner. The WSS was also responsible for the direction of Pioneer's tool pusher and, in the case of a well emergency, the WSS took over responsibility of all operations in close liaison with others, including the tool pusher.
Pioneer's tool pusher was responsible for the direction and supervision of the drill crew, for analyzing and overseeing all rig operations, and for regular rig inspections. The pusher was also accountable to Pioneer's Drilling Manager to ensure that rig operations were conducted in a safe and environmentally responsible manner. He also took directions for execution of operations from the WSS, assisted by Schlumberger Carbon. In the case of a well emergency, the pusher took the responsibility of executing all operations, under the direction of the WSS. The HSE Bridging Document was never signed by the parties.
The Hazard Card of May 12, 2015
On May 12, 2015, Ramsey filled out a hazard card regarding one of Pioneer's hoses on the mud pump. Ramsey's hazard card said the "HP hose coming off mud pump in poor condition," and "POFS [Pioneer Oil Field Services] to get new hose." The parties dispute whether Ramsey ever informed Pioneer about the need for a new hose. Ramsey claimed that he immediately communicated to Pioneer's tool pusher, Verdayne Seals, that the hose was coming off the mud pump and was in poor condition, and that Seals agreed to get a new one. The tool pusher is the lead Pioneer representative on location.
A hazard card dated March 17, 2015, issued by Ramsey noted that the "hose and mud pump was worn (you can see wires) with no safety slings." However, as argued by Defendants, there is no indication that the hose in question was the hose that injured Plaintiff on May 25, 2015.
Pioneer's employees Sonny McCulley and Corey Taylor deny that Ramsey informed them about the hazard card before Plaintiff's injury. Verdayne Seals testified that he had no recollection of anyone giving him a hazard card pertaining to the hose and, if he had gotten one, the hose "would have been replaced[,]" "no questions asked."
Medler stated that neither he himself nor anyone else, to his knowledge, made any attempt to see how the information on the hazard card was being utilized.
Ramsey and Eric Berlin compiled an "Observation Summary" of the daily meetings that reported safety notes from each day of March 17 through May 25, 2015. Medler testified that Schlumberger Carbon's duty with regard to the hose was to bring it to Pioneer's attention and defer to the judgment of those who had more expertise in relation to the rig and equipment there.
ADM Project Manager McDonald did not review the May 12, 2015 hazard card filled out Ramsey, and no one at ADM had access to the hazard cards or was familiar with them. He did not know of the hazard card until the Monday after Plaintiff's injury. McDonald reported that he never saw the allegedly unsafe hose. McDonald testified that, as ADM was the prime contractor for the project, "we could instruct Schlumberger to shut down if we saw something that we thought was a safety, compromises safety on the project, yes."
Plaintiff testified that if he had known the hose that injured him had been identified as a safety hazard on a hazard card, he would "not have been around [the hose] if I knew it was bad."
The Incident Resulting in Plaintiff's Injury
One week prior to the accident, Pioneer derrick hand Eric Austin said he noticed the hose was in "horrible condition." Pioneer employee Dustin Shreve also remembered being told that the hose was "showing some wear on the outside" by Austin, and Plaintiff. On May 24, 2015, one day prior to the accident, Plaintiff, who worked as a floor hand on the rig, saw "mud leaking from the mud pump" with "black shavings in it," which he knew was a "dangerous condition."
On May 25, 2015, after noticing mud leaking from the liner of the mud pump, Plaintiff informed the Pioneer driller to shut down the pump while Plaintiff investigated what was causing the leak. Plaintiff noticed that a mud pump hose was rubbing against the base of the mud pump, and friction was causing wear on the hose as rubber shavings appeared in the mud. Aware of this condition, Plaintiff took steps to remedy the problem himself. After instructing the Pioneer driller to turn off the pump, Plaintiff placed a piece of rubber between the hose and the steel base of the mud pump to eliminate the friction. Plaintiff then stepped about one foot away from the hose, and instructed the Pioneer driller to turn the hose back on. As soon as the hose was turned back on, the pressure caused the hose to burst and injure Plaintiff.
After the accident, Schlumberger Carbon assembled a team to investigate the incident, including Medler, Wagstaff, Malkewicz, Ramsey, Berlin, McCulley, Taylor, and Beverly Holzer. Malkewicz prepared a report on the accident for Schlumberger Carbon. The report noted that the "team" (presumably Pioneer) had implemented mitigation and preventative measures to reduce the severity and likelihood of an accident with the hose, but if Pioneer had performed sufficient hazard analysis it would have realized that the risk level was inappropriately high to proceed with the job, and the job would have been stopped.
Standing one foot away from a hose under pressure is against Pioneer's general safety practices and industry standards. It was noted in Schlumberger Carbon's report on the accident that Pioneer's crew regularly worked around high pressure hoses, and that this behavior was "tolerated." The report went on to state that, after the incident occurred, Pioneer issued a letter to its crew admonishing them that they should have known better. However, the report continued, "While this is true, it is also that this behavior is tolerated. This behavior should not be tolerated by [Schlumberger Carbon], contract HSE Supervisor, contract WSS, or [Pioneer] management."
Pioneer produced an "Observation Report," authored by McCulley, about the incident that stated that the "events that caused this incident to occur ... had nothing to do with equipment failure, but the complete failure by this crew," and that "[a]nybody that has worked on a rig of any size or shape ... has been told, not only by rig personnel, but also cement crews before they are allowed to pump. STAY AWAY FROM LINES UNDER PRESSURE!!!! THEY MAY FAIL!!! The people on that rig, especially with safety personnel on location 24-7 have heard this a multitude of times. I was there and heard it myself."
However, Dustin Shreve, Pioneer's driller, testified that it was not "beyond reason" for Plaintiff to stand close to the pump, because being close to the pump allows one to "listen, possibly hear a potential problem, maybe fix it before it turns into something major."
According to the agreement between ADM and the U.S. Department of Energy, Plaintiff's injury occurred during the "construction phase" of the ICCS Project.
Safety Updates Log
A document entitled "Safety Updates" comprised a daily safety update log from March 17, 2015 to May 24, 2015. The May 12, 2015 hazard card was not reflected in the Safety Updates log. Nor is any reference made during the March 17 through May 24, 2015 period to any remedial action that was taken to address the concern of the hazard card issued by Ramsey on May 12, 2015.
Morning reports prepared by Richards for Schlumberger contain no information related to the May 12, 2015 hazard card, but they do discuss equipment, inspections of the work site, the daily cost and progress of the drilling, reports of work on pumps and rigs and conducting of safety meetings. Plaintiff's Amended Complaint
Plaintiff filed an Amended Complaint (#13) against Defendants on May 22, 2017. The Amended Complaint alleges negligence against Defendant ADM (Count I) and Defendants Schlumberger Limited and Schlumberger Carbon (Count II).
ANALYSIS
Defendants’ argue summary judgment should be granted in their favor on both counts of Plaintiff's Amended Complaint because: (1) as a general rule in Illinois, a general contractor who employees an independent contractor is not liable for any harm caused by the independent contractor; (2) none of the Defendants retained any control over Pioneer's operations and maintenance of its mud pumps, and, therefore, owed no duty to Plaintiff; and (3) even if Defendants ADM or Schlumberger Limited owed a duty to Plaintiff, his injury was not caused by a breach of any alleged duty owed by either ADM or Schlumberger Limited.
Plaintiff responds that: (1) the general rule in Illinois on general contractors not being liable for torts caused by independent contractors does not apply here because: (a) ADM retained control over the policies and requirements relating to effective communications of hazardous conditions on site; and (b) Schlumberger Carbon retained control of the reporting of the day-to-day conditions of the work site and had actual knowledge of the hazard and failed to adequately exercise reasonable care to communicate the hazard information in order to prevent injury; and (2) this failure to communicate the hazard was the proximate cause of Plaintiff's injury.
I. Summary Judgment Standard
Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a) ; see also Celotex Corp. v. Catrett , 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In ruling on a motion for summary judgment, a district court "has one task and one task only: to decide, based on the evidence of record, whether there is any material dispute of fact that requires a trial." Waldridge v. Am. Hoechst Corp. , 24 F.3d 918, 920 (7th Cir. 1994). In making this determination, the court must construe the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in favor of that party. See Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ; Singer v. Raemisch , 593 F.3d 529, 533 (7th Cir. 2010). However, a court's favor toward the nonmoving party does not extend to drawing inferences which are only supported by speculation or conjecture. See Singer , 593 F.3d at 533. In addition, this court "need not accept as true a plaintiff's characterization of the facts or a plaintiff's legal conclusion." Nuzzi v. St. George Cmty. Consol. Sch. Dist. No. 258 , 688 F.Supp.2d 815, 835 (C.D. Ill. 2010) (emphasis in original).
The party opposing summary judgment may not rely on the allegations contained in the pleadings. Waldridge , 24 F.3d at 920. "[I]nstead, the nonmovant must present definite, competent evidence in rebuttal." Butts v. Aurora Health Care, Inc. , 387 F.3d 921, 924 (7th Cir. 2004). Summary judgment "is the ‘put up or shut up’ moment in a lawsuit, when a party must show what evidence it has that would convince a trier of fact to accept its version of events." Koszola v. Bd. of Educ. of City of Chicago , 385 F.3d 1104, 1111 (7th Cir. 2004), quoting Johnson v. Cambridge Indus., Inc. , 325 F.3d 892, 901 (7th Cir. 2003). Specifically, to survive summary judgment, the nonmoving party "must make a sufficient showing of evidence for each essential element of its case on which it bears the burden at trial." Kampmier v. Emeritus Corp. , 472 F.3d 930, 936 (7th Cir. 2007), citing Celotex Corp. , 477 U.S. at 322-23, 106 S.Ct. 2548.
II. Diversity Jurisdiction
This case is in federal court based on diversity jurisdiction, as Plaintiff, a citizen of Michigan, is suing Defendant ADM, a Delaware corporation with its principal place of business and corporate headquarters in Illinois, and Defendants Schlumberger Limited and Carbon, corporations with their principal place of business in Texas, for an amount in controversy in excess of $75,000. 28 U.S.C. § 1332. A federal court hearing a case under diversity jurisdiction must apply the substantive law of the state in which it sits. Jean v. Dugan , 20 F.3d 255, 260 (7th Cir. 1994), citing Erie Railroad Co. v. Tompkins , 304 U.S. 64, 78, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Thus the court will apply Illinois substantive law.
III. Schlumberger Limited's Position
As a preliminary matter, Defendants argue that Schlumberger Limited is not a proper party to this suit because it had nothing to do with the ICCS Project. Defendants argue that Schlumberger Limited is "three companies removed from the Schlumberger entity that entered into a contract with Pioneer" and that "Plaintiff has put forth no evidence - nor even sought any discovery - to show that Schlumberger Limited took any action in connection with the project which led to [Plaintiff's] injury, nor has it sought any discovery from the Schlumberger Limited entity." Defendants argue that, while Schlumberger Limited is a "distant, indirect parent company of Schlumberger Carbon, the mere existence of a parent-subsidiary relationship does not subject the parent company to liability absent veil-piercing."
While parent corporations and subsidiaries are distinct legal entities and are not generally liable for each other's wrongdoing, a parent corporation "could be held liable for the actions of its subsidiaries where the parent directly supervised the conduct of a specific transaction." Grabianski v. Bally Total Fitness Holding Corp. , 169 F.Supp.3d 785, 792 (N.D. Ill. 2015), quoting Esmark, Inc. v. National Labor Relations Board , 887 F.2d 739, 755-56 (7th Cir. 1989). However, "[p]iercing the corporate veil is not favored and in general, courts are reluctant to do so[,]" thus "[a]ccordingly, a party bringing a veil-piercing claim bears the burden of showing that the corporation is in fact a ‘dummy or sham’ for another person or entity." Judson Atkinson Candies, Inc. v. Latini-Hohberger Dhimantec , 529 F.3d 371, 379 (7th Cir. 2008).
Plaintiff, in his Response, does not present any evidence in support of piercing the veil and Schlumberger Limited's liability. Indeed, Plaintiff does not respond at all to Defendants’ arguments concerning Schlumberger Limited and, therefore, has waived any opposition to them and concedes the arguments. See Lacy v. Progressive Insurance Co. , 2016 WL 25717, at *2 (N.D. Ill. Jan. 4, 2016), citing Alioto v. Town of Lisbon , 651 F.3d 715, 721 (7th Cir. 2011) ("Longstanding under our case law is the rule that a person waives an argument by failing to make it before the district court. We apply that rule where a party fails to develop arguments related to a discrete issue, and we also apply that rule where a litigant effectively abandons the litigation by not responding to alleged deficiencies in a motion to dismiss." (citations omitted)); Bonte v. U.S. Bank, N.A. , 624 F.3d 461, 466-67 (7th Cir. 2010) ("Failure to respond to an argument—as the Bontes have done here—results in waiver.... This leaves us no choice but to accept U.S. Bank's assertions—supported as they are by pertinent legal authority—that the allegations in the Bontes’ complaint do not entitle them to relief."). Judgment is granted in favor of Defendant Schlumberger Limited on Count II of Plaintiff's Amended Complaint.
IV. Whether ADM and/or Schlumberger Owed Plaintiff a Duty of Care
Plaintiff's claims against Defendants sound in negligence. To survive summary judgment, Plaintiff must produce evidence permitting a reasonable trier of fact to find all of the elements of a negligence claim under Illinois law—duty, breach of duty, and causation. See Clifford v. Crop Production Services, Inc. , 627 F.3d 268, 271 (7th Cir. 2010).
Plaintiff, an employee of independent contractor Pioneer, is suing general contractors ADM and Schlumberger Carbon for injuries he received on the work site, alleging that their negligence caused the injury. Thus, Plaintiff must first prove that ADM and Schlumberger Carbon owed him a duty of care. See Clifford , 627 F.3d at 271. Whether there exists a duty is a question of law, and where there is no duty owed, there can be no liability. Swearingen v. Momentive Specialty Chemicals, Inc. , 662 F.3d 969, 972 (7th Cir. 2011).
Under Illinois common law based on the Restatement (Second) of Torts § 409, "one who employs an independent contractor is not liable for harm caused by the latter's acts or omissions." Carney v. Union Pacific Railroad Co. , 412 Ill.Dec. 833, 77 N.E.3d 1, 7 (Ill. 2016). This is because the hiring entity has no control over the details and methods of the independent contractor's work, and thus is not in a good position to prevent negligent performance, and liability therefore should not attach. Carney , 412 Ill.Dec. 833, 77 N.E.3d at 7. Rather, the party in control, the independent contractor, is the proper party to be charged with that responsibility and to bear the risk. Carney , 412 Ill.Dec. 833, 77 N.E.3d at 7-8.
"This does not mean, however, that one who hires an independent contractor is absolutely immune from tort liability for a plaintiff's injuries[,]" as under Restatement (Second) of Torts § 414, "a hiring entity may yet be liable for its own negligence where it retains some control over the independent contractor." Carney , 412 Ill.Dec. 833, 77 N.E.3d at 8 (emphasis in original). Here, Plaintiff's Amended Complaint does not seek to hold Defendants liable for the negligence of Pioneer, but rather claims liability based on Defendants’ own, direct negligence. Accordingly, the court will confine its analysis to whether Defendants retained control over the work of Pioneer, such that direct liability might attach under § 414 of the Restatement (Second) of Torts. See Carney , 412 Ill.Dec. 833, 77 N.E.3d at 10.
The issue of a general contractor's retained control may be decided as a matter of law where the evidence is insufficient to create a factual question. Carney , 412 Ill.Dec. 833, 77 N.E.3d at 10. The best indicator of whether the defendant retained control sufficient to trigger the potential for liability under § 414 is the written agreement between the defendant and the contractor, but even if the agreement provides no evidence of retained control by the defendant, such control may yet be demonstrated by evidence of the defendant's conduct at variance with the agreement. Carney , 412 Ill.Dec. 833, 77 N.E.3d at 10.
A. Whether the Contracts Between the Parties Evidence Retained Control
First, as it concerns the written agreement between Schlumberger Carbon and Pioneer, the court agrees that the Turnkey Contract provides no evidence of retained control by Schlumberger Carbon or ADM. Defendants point to the language in the Turnkey Contract that states: "[Schlumberger Carbon] engages [Pioneer] as an independent contractor to drill the hereinafter designated well[,]" and that "[Pioneer] shall furnish equipment, labor, and perform services as herein provided to drill a well," and that it "shall direct, supervise and control drilling operations and assumes certain liabilities to the extent specifically provided herein. " (Emphasis added). Further, as it regards health and safety on the work site, § 18.14.8 of the Turnkey Contract states:
[Pioneer] is an independent contractor set forth in this agreement, and directly controls the physical work site defined as the drilling rig and regulated equipment required to perform the work under this Agreement and the physical area which bounds this equipment and this work conducted under this agreement. [Pioneer] is responsible for providing and maintaining a safe and healthful work environment for all personnel at the work site. All personnel at the work site are required to comply with [Pioneer's] efforts to provide and maintain a safe and healthful work environment at the work site and to coordinate all work at the work site with [Pioneer].
Next, examining the Subaward Agreement between ADM and Schlumberger Carbon, nothing in that agreement demonstrates any intention on the part of ADM to retain control over Pioneer's work so as to give rise to a duty of care to Plaintiff. Schlumberger Carbon itself is identified as an "independent contractor," who would supply its own material and equipment, which does not show ADM intended to retain control.
The language in the Schlumberger Carbon/Pioneer agreements and the ADM/Schlumberger Carbon Subaward Agreement do not evince an intent by those parties to retain control over the work done by subcontractors. See Carney , 412 Ill.Dec. 833, 77 N.E.3d at 10. Further, the general provisions about safety and supervision are "part of the general rights reserved to someone, like [ADM], who employs a contractor, rather than evidence that defendant retained control over the manner in which work by [Pioneer] was performed." Carney , 412 Ill.Dec. 833, 77 N.E.3d at 10-11.
Based on Plaintiff's Response at page 19, Plaintiff appears to concede as much, acknowledging that the best indicator of whether a defendant retained control sufficient to trigger § 414 is the written agreement between the defendant and the contractor. Plaintiff goes on to say that Carney "pointed out that even if the agreement provides no evidence the defendant retained control, evidence of the defendant's conduct at variance with the agreement may demonstrate control." Plaintiff then goes on to argue how Defendants conduct on site was "at variance" with the agreement. Thus, the court will analyze whether Defendants’ conduct at the work site was at variance with the Turnkey Contract, and whether it demonstrated which Defendant(s), if any, "retained control" over Pioneer's work on the drill rig.
B. Whether Defendants’ Conduct On Site Was At Variance with the Agreements
The parties are in apparent disagreement about what aspects of the job Defendants must have "retained control" of in order for Defendants to owe Plaintiff a duty of care. Defendants argue that the key question is whether they "retained control specifically over Pioneer's drilling operations on the ICCS Project." This argument finds some support in Illinois case law. See Fonseca v. Clark Construction Group, LLC , 381 Ill.Dec. 189, 10 N.E.3d 274, 282 (Ill. App. Ct. 2014) ("Even if a general contractor retains the right to inspect work, orders changes to the plans, and ensures that safety precautions are observed and the work is done safely, the general contractor will not be held liable unless the evidence shows that the general contractor retained control over the incidental aspects of the independent contractor's work.").
Plaintiff argues that Schlumberger Carbon should be held liable under the retained control doctrine because they "did have actual knowledge or constructive notice of the dangerous condition of the hose and failed to communicate adequately the hazardous conditions so the unsafe condition would be remedied or removed from the work site." Plaintiff argues that ADM should be liable under the retained control doctrine because ADM implemented a "reasonably adequate communications process wherein hazard cards would timely become known to itself, Pioneer, [Plaintiff], and effectively addressed and remedied, where, as a result, the probability of injury would be lessened or negated."
On the surface, the two sides would seem to be talking past each other. One side believes the retained control analysis centers on whether or not Defendants retained control over the incidental day-to-day minute details of how Pioneer drilled the well at the rig, while the other side believes the analysis turns on whether or not Defendants retained control because they implemented a health and safety regimen to oversee Pioneer's work, and their negligence led to a health and safety hazard injuring Plaintiff. These two concepts, while seemingly different, actually do overlap to a certain extent, and there is support in Illinois case law for finding retained control when a defendant general contractor's control over work site safety was so complete as to impact how the subcontractor was actually able to perform its job. See Wilkerson v. Paul H. Schwendener, Inc. , 379 Ill.App.3d 491, 318 Ill.Dec. 653, 884 N.E.2d 208 (Ill. App. Ct. 2008).
Before proceeding further, however, the court must address Plaintiff's argument that, because Defendants knew of the unsafe condition of the hose, they owed Plaintiff a duty of care. In support Plaintiff cites to the Illinois Appellate Court's decision in Pasko v. Commonwealth Edison Co. , 14 Ill.App.3d 481, 302 N.E.2d 642 (Ill. App. Ct. 1973). Based on Pasko , Plaintiff argues that if Defendants knew of the unsafe conditions or the inadequate equipment and took no steps to stop the work or otherwise remedy the situation, such knowledge would provide a sufficient basis for the imposition of direct liability for failure to exercise the general supervisory authority with reasonable care. However, Pasko is of little help to Plaintiff.
First, Pasko has been recognized as being abrogated by subsequent Illinois decisions. See Lee v. Six Flags Theme Parks, Inc. , 381 Ill.Dec. 359, 10 N.E.3d 444, 468 (Ill. App. Ct. 2014) ; Cochran v. George Sollitt Construction Co. , 358 Ill.App.3d 865, 295 Ill.Dec. 204, 832 N.E.2d 355, 364-65 (2005). Second, it is true that comments a and b to § 414 state that the principal contractor is subject to liability if he fails to prevent the subcontractors from doing even the details of the work in a way unreasonably dangerous to others, if he knows or by the exercise of reasonable care should know that the subcontractors’ work is being so done, and has the opportunity to prevent it by exercising the power of control which he has retained in himself. Lee , 381 Ill.Dec. 359, 10 N.E.3d at 468. The principal contractor is also subject to liability if he knows or should know that the subcontractors have carelessly done their work in such a way as to create a dangerous condition, and fails to exercise reasonable care either to remedy it himself or by the exercise of his control cause the subcontractor to do so. Lee , 381 Ill.Dec. 359, 10 N.E.3d at 468. However, comments a and b must be read in conjunction with comment c to § 414, which states that, in order for the rule stated in § 414 to apply, "the employer must have retained at least some degree of control over the manner in which the work is done[,]" so that "the contractor is not entirely free to do the work in his own way." Restatement (Second) of Torts § 414 cmt. c (1965).
Again, how this control is measured is whether the control retained over safety aspects was so complete and specific, as opposed to a general right of supervision, that the general contractor retained control over the incidental aspects of the subcontractor's work so that the subcontractor was not free to perform the work in its own way. See Fonseca , 381 Ill.Dec. 189, 10 N.E.3d at 281-82.
This dynamic, and interaction between § 414 ’s comments, was discussed by the Seventh Circuit in Aguirre v. Turner Construction Co. , 501 F.3d 825 (7th Cir. 2007). The court stated:
As the next sentence of the comment explains, section 414 takes over where agency law ends by providing a theory of direct liability based on the existence of a duty of reasonable care. That duty is triggered when the employer—usually a general contractor—has retained supervisory control over the independent contractor without retaining control over all operative details of a project. As comment b explains, the rule stated in section 414 "is usually, though not exclusively, applicable when a principal contractor entrusts a part of the work to subcontractors, but himself or through a foreman superintends the entire job." Comment b elaborates that negligence liability arises in this situation if the general contractor "knows or by the exercise of reasonable care should know that the subcontractors’ work is being [done dangerously], and has the opportunity to prevent it by exercising the power of control which he has retained in himself." Liability also arises if the general contractor "knows or should know that the subcontractors have carelessly done their work in such a way as to create a dangerous condition, and fails to exercise reasonable care either to remedy it himself or by the exercise of his control to cause the subcontractor to do so."
Aguirre , 501 F.3d at 829.
The court then went on to note that, in proceeding on the understanding that § 414 states a theory of direct liability based on a general contractor's failure to exercise reasonable care, whether the general contractor "retained a level of control sufficient to give rise to a duty to exercise reasonable care is a question of law." Aguirre , 501 F.3d at 829 (emphasis added). The Seventh Circuit then cited to comment c of § 414, and stated that "[i]n determining whether that level of control has been retained, Illinois courts ask whether the principal merely retained general oversight of work progress and safety or actually engaged in detailed supervision and/or control of subcontractors’ methods and means of performing work." Aguirre , 501 F.3d at 830. That is the deciding factor in determining whether Defendants owe a duty to Plaintiff.
The court will address what level of control each Defendant, ADM and Schlumberger Carbon, retained vis-a-vis the manner in which Pioneer performed its work, whether regarding how Pioneer drilled a well or the safety measures implemented on site.
1. ADM
First, with regard to ADM's responsibilities on site as to how Pioneer conducted their work, outside of health and safety issues, the court finds nothing in ADM's conduct that puts it at variance with its status under the written contracts as a general contractor overseeing independent contractors Pioneer and Schlumberger. ADM's ICCS Project Manager Scott McDonald testified that ADM, which is not a construction contractor and had no experience with drilling oil or gas wells, had no control or supervisory authority over how Pioneer hired or trained its employees. Nor did ADM have any control or supervisory authority over how Pioneer selected, maintained, repaired, or replaced its equipment, including the hoses to be used on the mud pumps, in connection with drilling the ICCS well. While ADM did have supervisory power to cause accurate reporting of work site conditions to be included in daily reports, it had no control or supervisory authority over Pioneer's drilling process used to drill the ICCS well. ADM did not have such control or supervisory authority, according to McDonald, because it did not have expertise in drilling wells or the equipment used to drill wells, and relied upon its contractors to provide ADM with that expertise. Other non-ADM employees on site confirmed that ADM did not direct the drilling work or have a regular role in safety with respect to operating the drilling equipment.
Further, the "ADM Concerns" document, in answer to the question of who were the responsible personnel/contractors for the supply of equipment, materials, plans and procedure, states "Wellsite responsibility resides with Well Site Supervisor Merl Richards supported by Schlumberger Drilling Engineer Russell Wagstaff. Final responsibility resides with Jim Kirksey Carbon Services Well Engineering Manager in consultation with John Medler SCS ICCS Project Manager[.]" After the word "Manager," someone, it is not identified by the parties who it was, drew an arrow and wrote in "Flow down to Pioneer."
Based on the above, ADM appeared, at least outside of the health and safety aspect, to retain no operational control over how Pioneer performed its work drilling the well. Indeed, Plaintiff, in his Response, does not argue the point, instead confining its argument to ADM's responsibilities regarding health and safety.
If ADM's safety program sufficiently affected Pioneer's means and methods of doing its work, then such a program could bring ADM within the ambit of the retained control exception. Aguirre , 501 F.3d at 830, quoting Martens v. MCL Construction Corp. , 347 Ill.App.3d 303, 282 Ill.Dec. 856, 807 N.E.2d 480, 492 (2004). The testimony in the record reveals that health and safety on site was the responsibility of "all parties involved," and Pioneer employee McCulley testified that all parties had an obligation to provide a safe work environment. Specifically as it concerned ADM, McDonald testified that safety was a high priority and something that ADM would "look at[,]" and ADM did order safety updates to be presented to it so it could manage safety from a corporation perspective, from a project manager perspective, and monitor what was happening with the project. McDonald stated if he saw something unsafe, he would talk to Schlumberger Carbon, and they would talk to Pioneer, and "it would be addressed." He also testified that, as prime contractor on the Project, ADM could instruct Schlumberger Carbon to shut down if ADM saw something that compromised safety.
Under the HSE Bridging Document , ADM had "overall control of and responsibility of the Carbon Capture and Storage well construction," which meant "permitting, drilling, well services, logistics, transportation, communications, HSE" and it was "responsible for giving overall direction to the project." However, Schlumberger Carbon, according to the HSE was responsible for the day-to-day supervision of drilling operations, service providers, logistics, administration of services, and execution of operations, and Pioneer was responsible for providing the rig, including crew, medical first aid kits for rig personnel, and rig HSE management system. The document's purpose was to "establish whose safety policies will rule for certain situations on a project."
Defendants repeatedly argue that the HSE Bridging Document was not signed, implying that the lack of signatures means the document is invalid and should not be considered in weighing whether Defendants retained control over Pioneer's work on the site. However, in Illinois, a signature is not always essential to the binding force of an agreement. Testa v. Emeritus Corp. , 2015 WL 5183900, at *4 (N.D. Ill. Sept. 4, 2015). The object of a signature is to show mutuality or assent, but these facts may be shown in other ways, as, for example, by acts or conduct of the parties. Testa , 2015 WL 5183900, at *4. Only where signatures are an expressly-required condition-precedent of an agreement will their absence render the contract voidable. Testa , 2015 WL 5183900, at *4. Here, Defendants have not pointed to where the HSE Bridging Documents states signatures are an expressly required condition-precedent.
Pursuant to the HSE Bridging Document, Schlumberger Carbon's Well Site Supervisor (WSS) had overall responsibility for the day-to-day drilling operations. ADM's only involvement with the WSS was that the WSS could receive direction and input from ADM Project manager McDonald.
The court finds that, based on the testimony and the HSE Bridging Document, ADM's safety program did not sufficiently affect Pioneer's means and methods of doing its work so as to bring it in the ambit of the retained control exception. See Aguirre , 501 F.3d at 830. Safety was a "high priority" to ADM, and ADM would "look at" safety issues while monitoring the Project. If McDonald saw something he felt was unsafe, he would talk to Schlumberger Carbon who would talk to Pioneer, who would address the problem. However, the "the right to stop the work, tell the contractors to be careful, and change the way something [is] is being done if [the defendant] felt something was unsafe" does not establish sufficient control for purposes of § 414. Carney , 412 Ill.Dec. 833, 77 N.E.3d at 13-14, quoting Connaghan v. Caplice , 325 Ill.App.3d 245, 259 Ill.Dec. 108, 757 N.E.2d 971, 976 (2001). While ADM appears to have retained "overall control and responsibility" for the well site construction under the HSE Bridging Document, and could give direction and input to the Well Site Supervisor of Schlumberger Carbon, it did not have control or responsibility for day-to-day operation of the drilling site.
The fact that ADM retained general oversight of construction progress and safety, but did not actually engage in detailed supervision and/or control of Pioneer's methods and means of performing work, does not bring ADM within the retained control exception of § 414. See Aguirre , 501 F.3d at 829.
Plaintiff, throughout his Response, focuses on how ADM had a responsibility to effectively "communicate" with the subcontractors about workplace safety issues, and how it failed in that regard concerning the May 12, 2015 hazard card. However, whether ADM had a "duty" to establish effective communication regarding hazard cards when all parties were responsible for workplace safety, is not really what is at issue, and was not the concern of the courts that found the retained control exception applicable to general contractors via safety control. See Schreiber v. Idea Engineering & Fabricating , 2003 WL 22071491, at *3 (N.D. Ill. Sept. 5, 2003) ("The important factor however is not whether [the general contractor] knew about potential safety hazards at the job site, but rather whether it exercised control over the methods used by the welders.") (Emphasis in original). This case is distinguishable from those cases.
In Aguirre , the general contractor required the independent contractor to follow 23 rules specific to scaffold construction; the general contractor's employees regularly walked the site and could require the independent contractor employees to correct any deficiency observed in the scaffold; the general contractor inspected many of the independent contractor's scaffolds and, notably, "imposed specific alternative design requirements on the scaffold from which [the plaintiff] fell." Aguirre , 501 F.3d at 830-31.
In Wilkerson , the general contractor required the subcontractor to provide a "site specific safety plan" for the general contractor's approval and also sent the subcontractor a scathing letter warning the subcontractor that its work would be stopped if it did not comply with the specific safety procedure. Wilkerson , 318 Ill.Dec. 653, 884 N.E.2d at 211-12. The subcontractor was also required to comply with a list of 21 safety regulations prepared by the general contractor and to attend the general contractor's weekly safety-related meetings. Wilkerson , 318 Ill.Dec. 653, 884 N.E.2d at 211. Indeed, the Illinois Supreme Court, in commenting on Wilkerson , noted that "the record was replete with evidence that the defendant retained and exercised complete control over work site safety." Carney , 412 Ill.Dec. 833, 77 N.E.3d at 13.
In Bokodi v. Foster Wheeler Robbins, Inc. , 312 Ill.App.3d 1051, 245 Ill.Dec. 644, 728 N.E.2d 726 (2000), the general contractor provided 29 safety measures and procedures that subcontractors were required to follow; employed safety personnel to monitor the site for compliance with its safety guidelines; gave its own employees broad powers to halt any subcontractor work based on a perception of an unsafe working environment; required subcontractors to conduct safety training meetings that the general contractor's employees could monitor; and required subcontractors to participate in its own safety programs. Bokodi , 245 Ill.Dec. 644, 728 N.E.2d at 735.
In Gerasi v. Gilbane Building Co. , 412 Ill.Dec. 325, 75 N.E.3d 305 (Ill. App. Ct. 2017), while the general contractor's contract with the independent contractor did vest the general contractor with overall responsibility for safety on the project, the general contractor also required subcontractors to "adhere to the provisions of its extensive safety plan." Gerasi , 412 Ill.Dec. 325, 75 N.E.3d at 317. This plan gave the general contractor "active control" and made the general contractor "responsible for planning and requiring all work to be done in compliance with the plan and weekly inspections relating to all safety to be conducted and documented." Gerasi , 412 Ill.Dec. 325, 75 N.E.3d at 308. Further, the general contractor's post-accident conduct in insisting that the method of procedure "regarding temporary tie-ins require that electricians wear personal protective equipment, while not relevant to prove" the general contractor's negligence, did suggest to the court that the subcontractor "was not entirely free to perform this task in its own way." Gerasi , 412 Ill.Dec. 325, 75 N.E.3d at 317.
As detailed above, ADM's control over the safety aspects of the work site do not come close to the type of extensive, detailed, day-to-day control exerted by general contractors found to fall under the retained control exception. Were the court to hold that ADM fell within the orbit of the retained control exception for attempting to integrate all three companies health and safety plans, and for retaining overall supervisory responsibility for the Project and Project safety, the court would be penalizing ADM's safety efforts by creating, in effect, strict liability for personal injury to any job site employee. See Carney , 412 Ill.Dec. 833, 77 N.E.3d at 13. This the court cannot do.
In his Response, Plaintiff raises a new argument based on the Restatement (Second) of Torts § 343. Plaintiff argues that ADM, as the possessor of the land on which the accident occurred, is liable to Plaintiff, even if the hazard was open and obvious, because ADM had reason to expect that Plaintiff would proceed to encounter the known or obvious danger because to a reasonable man in Plaintiff's position "the advantages of doing so would outweigh the apparent risk."
Plaintiff did not plead premises liability under § 343 in his Amended Complaint. "A plaintiff may not amend his complaint through arguments in his brief in opposition to a motion for summary judgment." Anderson v. Donahoe , 699 F.3d 989, 997 (7th Cir. 2012) ; Linkepic Inc. v. Vyasil, LLC , 370 F.Supp.3d 906, 927 n.10 (N.D. Ill. 2019) ; Holmes v. Godinez , 311 F.R.D. 177, 232 (N.D. Ill. 2015). However, even if the court were to consider the argument, it must fail.
Regarding §§ 343 and 343A of the Restatement (Second) of Torts, the Seventh Circuit has stated:
Illinois courts have adopted §§ 343 and 343A of the Restatement (Second) of Torts for purposes of evaluating premises liability claims. Cooper v. Carl A. Nelson & Co. , 211 F.3d 1008, 1015 (7th Cir. 2000), as amended on denial of reh'g and reh'g en banc, (June 1, 2000) (citing Genaust v. Ill. Power Co. , 62 Ill.2d 456, 468, 343 N.E.2d 465, 472 (1976) ). These provisions impose liability on landowners, under certain circumstances, for harm caused "by a condition on the land." Restatement (Second) of Torts § 343. But not everything located on a landowner's property is a "condition on the land." See, e.g., Gregory v. Beazer E. , 384 Ill.App.3d 178, 191, 322 Ill.Dec. 926, 892 N.E.2d 563, 577 (2008) (asbestos blankets and gloves were not conditions on the land); Quinton v. Kuffer , 221 Ill.App.3d 466, 472, 164 Ill.Dec. 88, 582 N.E.2d 296, 300 (1991) (a flammable 55–gallon drum that exploded was not a condition on the land).
Schaefer v. Universal Scaffolding & Equipment, LLC , 839 F.3d 599, 607 (7th Cir. 2016).
In Schaefer , the Seventh Circuit rejected the plaintiff's argument that his injury, caused by falling scaffolding on the work site that had been purchased by the general contractor but erected by the plaintiff's subcontractor employer, qualified for a premises liability claim under §§ 343 and 343A, holding:
Schaefer was not injured by already-assembled scaffolding, which could arguably be a condition on the land. He alleges that he was injured as a result of an activity taking place on the Dynegy property, one that involved a defective piece of equipment. The cause of Schaefer's injury is unlike those things that constitute conditions on the land, so premises liability is a poor fit for Schaefer's negligence claim against Dynegy.
Schaefer , 839 F.3d at 607.
Likewise, Plaintiff was not injured by an already existing "condition of the land." Rather, he alleges that he was injured as a result of an activity taking place on ADM's property, or property ADM controlled, involving a defective piece of equipment, a hose, that Plaintiff's employer brought on to the property, installed on the property, and used on the property. Plaintiff's "injury is unlike those things that constitute conditions on the land, so premises liability is a poor fit" for Plaintiff's negligence claim against ADM. See Schaefer , 839 F.3d at 607.
Based on the foregoing, summary judgment is GRANTED in favor of ADM on Count I of Plaintiff's Amended Complaint.
2. Schlumberger Carbon
In terms of on-site responsibilities, John Medler, Schlumberger Carbon's ICCS Project Manager, testified that Schlumberger Carbon was not responsible for helping Pioneer fix its equipment, nor was it responsible for becoming an expert in Pioneer's equipment. Russell Wagstaff, Schlumberger Carbon's Drilling Engineer on the ICCS Project, likewise testified that nobody from Schlumberger Carbon had responsibility over operating, inspecting, or maintaining Pioneer's mud pump equipment. Other employees and independent contractors working for Schlumberger Carbon testified to the same, as recounted above.
Based on the above, like ADM, Schlumberger Carbon appeared to retain no operational control over how Pioneer performed its work drilling the well. Indeed, as with ADM, Plaintiff, in his Response, does not very much argue the point, instead mostly confining his argument to Schlumberger Carbon's responsibilities regarding health and safety.
Regarding health and safety, Schlumberger Carbon's independent contractors, Eric Berlin and Scott Ramsey of New Tech Global, testified that they facilitated communications between the various vendors and promoting safety awareness in an advisory role. They also testified that they lacked any expertise and knowledge of Pioneer's equipment. Project Manager Medler testified that health, safety, and "environmental" issues were the responsibilities of all parties on site. If safety issues with the drilling were brought to Schlumberger Carbon's attention, they would address those issues with Pioneer. Well Site Supervisor ("WSS") Merl Richards, an independent contractor working for Schlumberger Carbon, did produce daily reports on activities at the work site for Schlumberger Carbon.
The HSE Bridging Document, on the other hand, seems to be somewhat at odds with the Turnkey Contract and the testimony cited by Defendants, in that it ascribes more control and authority over the drilling operations to Schlumberger Carbon. Although ostensibly a health and safety document, the authority and responsibility of Schlumberger Carbon's WSS appear to overlap health and safety and control of drilling operations.
Based on the HSE Bridging Document, Schlumberger Carbon did have more involvement in the drilling than ADM, whose role was limited to general supervisory authority as the prime contractor. Schlumberger Carbon was "responsible for the day-to-day supervision of drilling operations , service providers, logistics, administration of services, and execution of operations. " (Emphasis added). On the rig, the Schlumberger Carbon WSS had overall responsibility for day-to-day drilling operations, and was "responsible for the direction of the [Pioneer] tool pusher." The primary duty of the WSS was to ensure that drilling operations were conducted in a safe, environmentally responsible, and cost effective manner. In the case of a well emergency, the WSS takes over responsibility of all operations in close liaison with others, including the tool pusher.
Defendants argue that the WSS was an independent contractor who reported to Schlumberger Carbon, and not an agent, and thus Schlumberger Carbon cannot be held to have retained control through the WSS. However, the HSE Bridging Document makes clear that the WSS reports "directly" to Schlumberger Carbon's Project Manager on a daily basis, and "is the representative of ADM and Schlumberger on the rig."
Further, pages 31 to 32 of the HSE Bridging Document contain an extensive, detailed listing of the Schlumberger Carbon WSS's duties and responsibilities. The WSS is responsible for "all well site operations" and is "responsible for planning, co-ordination, supervision, execution, and evaluation of all work performed by [Pioneer], Schlumberger, and other third parties on the rig." In addition, the WSS was to "co-ordinate and supervise[ ] well site activities with [Pioneer], third party contractors to ensure compliance with work program and optimum efficiency in job execution." In terms of "operations," the WSS was "responsible for monitoring well parameters and drilling trends" as well as assisting "in evaluation of potential improvements to well design and execution of operations." The WSS was also responsible for "ensur[ing] suitable operational procedures are followed" and had "[o]verall responsibility for quality control of construction of the well." The WSS also had "[f]inal authorization of down hole and equipment installation."
Pioneer's tool pusher, on the other hand, was responsible for the direction and supervision of the drill crew, for analyzing and overseeing all rig operations, and for regular rig inspections. The pusher is also accountable to Pioneer's Drilling Manager to ensure that rig operations are conducted in a safe and environmentally responsible manner. He also takes directions for execution of operations from the WSS, assisted by Schlumberger Carbon. In the case of a well emergency, the pusher takes the responsibility of executing all operations, under the direction of the WSS.
Examining the HSE Bridging Document, it is arguable, taking all inferences in favor of Plaintiff, that Schlumberger Carbon, via the WSS, retained some control over the manner in which Pioneer did its work. The WSS was responsible for day-to-day "supervision" and "execution" of drilling operations. Read in favor of Plaintiff, that could include operations at the drilling rig where Plaintiff was injured. The WSS also had responsibility for "quality control" of the well's construction. Again, this is a somewhat broad mandate, but could be read to find that Pioneer could not operate the well site entirely on its own.
To be sure, pursuant to the HSE Bridging Document, Pioneer's tool pusher had more control over the incidental, daily operational aspects of the drilling, but the nature of the responsibilities of the Schlumberger Carbon WSS creates a genuine issue of material fact as to whether Pioneer's tool pusher was totally free to perform the work in its own way. See Carney , 412 Ill.Dec. 833, 77 N.E.3d at 11. The HSE Bridging Document, ostensibly part of the parties’ safety program, may have sufficiently affected Pioneer's means and methods of doing its work, thus bringing Schlumberger Carbon within the ambit of the retained control exception. See Martens , 282 Ill.Dec. 856, 807 N.E.2d at 491-93.
The court would also note Schlumberger Carbon's extensive involvement in safety based on Ramsey and Berlin's daily safety reports and daily safety meetings. Schlumberger Carbon's representatives "advised" Pioneer on what to do about the hose and Ramsey "request[ed]" that the hose be replaced. Read with all inferences in favor of Plaintiff, as the court must do at summary judgment, a reasonable trier of fact could infer that Schlumberger Carbon was ordering Pioneer's tool pusher, Verdayne Seals, to replace the hose, indicating Pioneer was not entirely free to do the work its own way.
Therefore, summary judgment is denied on this point.
However, for the same reasons articulated above with respect to Plaintiff's premises liability argument, that argument against Schlumberger Carbon is rejected for the same reasons as applied to ADM.
IT IS THEREFORE ORDERED:
(1) Defendants’ Motion for Summary Judgment (#70) is GRANTED in part and DENIED in part. Judgment is entered in favor of Defendants ADM and Schlumberger Limited and against Plaintiff. Summary judgment is denied as to Defendant Schlumberger Carbon.
(2) This case remains set for a final pretrial conference on Monday, April 5, 2021, at 11:30 am, and jury trial set for Tuesday, May 4, 2021, at 9:00 am.