Opinion
No. 98-3116, SECTION: "R"(1).
December 7, 2000.
ORDER AND REASONS
Before the Court are defendants', Lake Marion, Inc., Bay Ocean Management, Inc., and the M/V LAKE MARION, motion for certification of interlocutory appeal pursuant to 28 U.S.C. § 1292 (b), for entry of partial summary judgment and modifying the Magistrate Judge's Protective Order, and for stay pending appeal. For the following reasons the Court denies defendants' motions.
I. Background
This case involves alleged damage to a shipment of cold rolled, hot rolled, and galvanized steel en route from Riga, Latvia to various ports in the United States aboard the M/V LAKE MARION. At the time of the alleged incident, Lake Marion owned the M/V LAKE MARION, and Western Bulk Carriers had time chartered the ship. Western Bulk Carriers -issued bills of lading for the steel shipment on the CONGENBILL 1978 form, and Riga Shipping Agency, the charterer's agent, signed them on behalf of the Master.
The bills of lading each contained a "General Paramount Clause" which provided:
The Hague Rules contained in the International Convention for the Unification of certain rules relating to Bills of Lading, dated Brussels the 25th August 1924 as enacted in the country of shipment shall apply to this contract. When no such enactment is in force in the country of shipment, the corresponding legislation of the country of destination shall apply, but in respect of shipments to which no such enactments are compulsorily applicable, the terms of the said Convention shall apply.
Trades where Hague-Visby Rules apply In trades where the International Brussels Convention 1924 as amended by the Protocol signed at Brussels on February 23rd 1968 — the Hague-Visby Rules — apply compulsorily, the provisions of the respective legislation shall be considered incorporated in this Bill of Lading. The Carrier takes all reservations possible under such applicable legislation, relating to the period before loading and after discharging and while the goods are in the charge of another Carrier, and to deck cargo and live animals.
(Defs.' First Mem. Supp. Partial Summ. J. Ex. A.) The bills of lading do not expressly refer to COGSA or a limitation of liability to $500 per package. Nor do the bills of lading mention a published tariff. The import tariff published by Western Bulk Carriers states that the Hague Rules apply to determine the carrier's liabilities. ( See Defs.' Mem. Supp. First Partial Summ. J. Ex. 1.) It does not refer to COGSA or COGSA's liability limitation provision. ( See Id.)
Although the bills of lading identify JSV "Severstal-Insvest" as the shipper, Steel Coils purchased the cargo and became the consignee. Upon discharge at Camden, New Orleans, and Houston, it was allegedly discovered that seawater had entered the cargo holds and damaged the steel. Plaintiff, Steel Coils, filed this suit to recover damages in the amount of $550,000.
On June 15, 2000, the Court denied defendants' motion for partial summary judgment limiting defendants' liability for cargo damage to $500 per package under COGSA. The Court found that defendants failed to provide prima fade evidence that plaintiff had been given a fair opportunity to avoid the limitation of liability provision. After the Court issued the June 15 order, defendants still insisted that the limit of liability applies. Plaintiff moved for a second partial summary judgment to clarify this issue. On October 25, 2000, the Court granted a second partial summary judgment, explicitly stating that the limitation of liability did not apply. See Court's October 25, 2000 Order.
II. Discussion
A. Certification for Interlocutory Appeal
Before a district court may certify an order for interlocutory appeal, the moving party must demonstrate that the matter involves (1) a controlling question of law, (2) as to which there is substantial ground for difference of opinion, and (3) an immediate appeal from the order would-materially advance the ultimate termination of the litigation. See 28 U.S.C. § 1292 (b). See also Complaint of L.L.P. D. Marine, Inc., 1998 WL 66100, at *1 (E.D. La. Feb. 13, 1998) (Movant bears the burden of showing that all of these criteria have been satisfied.). An interlocutory appeal, however, is "exceptional" and "assuredly does not lie simply to determine the correctness of a judgment." Clark-.Dietz Assocs.-Eng'rs, Inc. v. Basic Constr. Co., 702 F.2d 67, 68, 69 (5th Cir. 1983).
The Court finds that the circumstances presented in this case do not meet the requirements of Section 1292(b). As the movants, defendants bear the burden of showing that there is a "substantial ground for difference of opinion." Defendants have not demonstrated that there is conflicting or contradictory opinions in the Fifth Circuit that have ruled on the issue of what constitutes fair opportunity for COGSA's limitation to apply. The Court reviewed Fifth Circuit precedent to conclude that the defendants failed to establish a prima facie case of fair opportunity because the bill of lading did not expressly incorporate COGSA and its $500 liability limitation nor did it incorporate or refer to a tariff or contract that does so. The Court explained that once defendants failed to even make a prima facie case, the limitation argument was dead.
In attempting to argue that a substantial difference of opinion exists, defendants rely upon Bucher-Guyer AG v. M/V INCOTRANS SPIRIT, 1987 WL 18616 (E.D. La. Oct. 15, 1987), in which the district court certified issues for appeal under 28 U.S.C. § 1292(a)(3), which permits interlocutory appeals of district court decrees that determine the rights and liabilities of the parties in admiralty cases. However, the Fifth Circuit dismissed the appeal stating that "[t]he decision of whether the $500 COGSA limitation on damages applies in this case is not a decision determining the rights and liabilities of the parties." See Bucher-Guyer AG v. M/V INCOTRANS SPIRIT, 868 F.2d 734 (5th Cir. 1989). This case does not support an interlocutory appeal here. Thus, the Court finds that defendants did not meet their burden and there is no substantial ground for difference of opinion. Accordingly, the Court denies defendants' motion for interlocutory appeal.
B. Stay
Having decided not to certify an interlocutory appeal, it is not necessary for the Court to consider staying further proceedings.
III. Conclusion
For the foregoing reasons the Court denies defendants' motions for certification of interlocutory appeal pursuant to 28 U.S.C. § 1292(b) and for stay pending appeal.