Opinion
Case No.: 6:17-cv-01081-MK
04-28-2020
JERRAD WATTS, an individual Plaintiff, v. KELVIN RAY DECKER, an individual residing in Coos County, Oregon; and the FISHING VESSEL #5, an ocean going fishing vessel hailing from Newport, Oregon, Defendants.
FINDINGS AND RECOMMENDATION RE: PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT KASUBHAI, Magistrate Judge :
Before the Court is Plaintiff's Motion for Default Judgment. ECF No. 20. The Court held a telephonic evidentiary hearing on April 14, 2020. ECF No. 28. For the reasons set forth below, the Court should grant Plaintiff's Motion for Entry of Judgment (ECF No. 20) and enter judgment as specified below.
BACKGROUND
Plaintiff alleges the following facts. Plaintiff was employed by Defendant Kelvin Ray Decker ("Decker") as a seaman. Compl. ¶¶ 6-7, ECF No. 1. Decker owned, operated, manned and controlled the fish vessel No. 5 ("Vessel"). Id. ¶ 5. When Plaintiff was fishing on the Vessel on or about May 9, 2017, a fish spine speared and penetrated Plaintiff's right hand. Id. ¶ 7. Plaintiff alleges that Decker failed to warn Plaintiff of impending dangers, failed to provide a seaworthy vessel and a safe method of operation, and failed to provide medical care in a timely and competent manner. Id. Plaintiff's injury resulted in an infection which threatened his life. Id. Plaintiff's injured finger was ultimately paralyzed. Id.
Plaintiff brought three claims: negligence under the Jones Act, 46 U.S.C. § 30104, unseaworthiness, and maintenance and cure. Id. ¶¶ 1-18. Plaintiff seeks judgment against Defendant Vessel and her appurtenances, requesting the Vessel and her appurtenances be condemned and sold for the amount due Plaintiff. Id. at 7. Plaintiff also seeks judgment against Decker for general damages, health care expenses, loss of income, maintenance, cure and unearned wages, punitive damages, attorney's fees and costs, pre-judgment interest according to general maritime law, and Plaintiff's costs of suit. Id. at 7-8.
Because Decker was "avoiding process," Plaintiff moved for alternative service. Am. Mot. for Alternative Service, 2, ECF No. 11. The Court granted Plaintiff's Motion for Alternative Service. ECF No. 10. Subsequently, the clerk granted Plaintiff's Motion for Entry of Default following Defendants' failure to respond or appear. ECF No. 19. Plaintiff filed a Motion for Entry of Judgment, seeking a judgment of $2,194,919.00 itemized as follows:
| Unpaid earnings | $1,800 |
| Lost Earnings | $126,000 |
| Medical Expenses | $35,260 |
| Maintenance | $15,000 |
| Pain and Suffering | $1,000,000 |
| Punitive Damages | $1,000,000 |
| Attorney Fees | $15,210 |
| Attorney Costs | $1,649 |
LEGAL STANDARD
A defendant must file a responsive pleading within twenty-one (21) days of being served or within sixty (60) days if the defendant has timely waived service under Fed. R. Civ. P. 4(d). Fed. R. Civ. P. 12(a)(1)(A). If the defendant fails to file a responsive pleading or otherwise defend (as shown by affidavit or otherwise) the clerk must enter the defendant's default. Fed. R. Civ. P. 55(a).
The district court has broad discretion to enter a default judgment. See Fed. R. Civ. P. 55(b); Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980); Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917 (9th Cir. 1987) (per curiam) ("Rule 55 gives the court considerable leeway as to what it may require as a prerequisite to the entry of a default judgment."). A hearing or referral may be held to conduct an accounting, determine damages, establish the veracity of allegations through evidence, or investigate any other matter. Fed. R. Civ. P. 55(b)(2).
Upon default, the court may generally take the factual allegations of the complaint as true, other than those relating to the amount of damages. TeleVideo Sys., 826 F.2d at 917-18 (citation omitted). The court is not bound to admit facts that are not well-pleaded or admit conclusions of law. DIRECTV, Inc. v. Hoa Huynh, 503 F.3d 847, 854 (9th Cir. 2007) (quoting Nishimatsu Constr. Co. v. Houston Nat'l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975)).
When considering an entry of a default judgment the courts consider:
(1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff's substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986) (citation omitted).
DISCUSSION
The Court examines the seven factors laid out in Eitel. 1. Factors 1, 5, and 7
The first Eitel factor examines the possibility of prejudice to Plaintiff. Eitel, 782 F.2d at 1471. Refusal to grant default judgment would be prejudicial to Plaintiff because Plaintiff would have no other avenue to collect the unpaid regular and overtime wages.
The fifth Eitel factor considers the possibility of a dispute concerning material facts. Id. at 1471-72. Accepting the factual allegations as true other than those relating to damages, there does not appear to be a dispute of material facts.
As to the seventh Eitel factor, the strong policy favors decisions on the merits to avoid perverse incentives and setting precedent allowing defendants to ignore actions against them. The seventh Eitel factor must be found in Plaintiff's favor.
2. Factor 6
The sixth Eitel factor requires the Court to consider whether the default was due to excusable neglect. Eitel, 782 F.2d at 1472. Nothing in the record before the Court suggests excusable neglect. To the contrary, the record suggests intentional evasion of service. Despite Plaintiff's multiple attempts to serve Defendant Decker, Decker avoided process. Carey Decl. ¶¶ 3-9, ECF No. 8. With the Court's permission of alternative service, Plaintiff served Decker with a certified mail and a first-class mail. The certified mail was returned unclaimed but the first-class mail has not been returned. Pl.'s Status Rept. 2, ECF No. 15. According to the declaration of Plaintiff's counsel, "Plaintiff initially located the Vessel," but its "documentation papers have been removed from the usual place of posting in the wheelhouse on the [V]essel. The [V]essel has recently been moved to an unknown location." Carey Decl. ¶ 10, ECF No. 8. Furthermore, Plaintiff's counsel "sent a letter to [D]efendant demanding maintenance and cure" and "[D]efendant answered, refusing to pay." Cary Decl. ¶¶ 7-8, ECF No. 21.
The circumstances suggest that Decker was served and made aware of this action against him but has failed to appear. The Court therefore should find that the sixth factor favors an entry of default judgment.
3. Factors 2 and 3
The second Eitel factor concerns the merits of Plaintiff's substantive claim and the third concerns the sufficiency of the complaint. Eitel, 782 F.2d at 1471. Plaintiff brought three claims: negligence under the Jones Act, unseaworthiness, and maintenance and cure. For the following reasons the Court should find factors 2 and 3 in Plaintiff's favor.
A. Jones Act Negligence Claim
"To recover on his Jones Act [negligence] claim, [Plaintiff] must establish that his employer, [Decker], ... was negligent and that this negligence was a cause, however slight, of his injuries. The quantum of evidence necessary to support a finding of Jones Act negligence is less than that required for common law negligence, ... and even the slightest negligence is sufficient to sustain a finding of liability." Ribitzki v. Canmar Reading & Bates, Ltd. P'ship, 111 F.3d 658, 662 (9th Cir. 1997), as amended on denial of reh'g and reh'g en banc (June 5, 1997), amended on reh'g en banc sub nom. Ribitzki v. Canmar Reading & Bates, Ltd. (9th Cir. June 5, 1997) (internal citation and quotation marks omitted). "The elements of a Jones Act negligence claim are: duty, breach, notice and causation." Id.
Here, Plaintiff alleges all four elements of a Jones Act negligence claim. Plaintiff alleges that he "was in the employ of [Decker] as a seaman[.]" Compl. ¶ 6, ECF No. 1. Therefore, Decker owes his seaman, Plaintiff, a duty under the Jones Act to provide him with a safe place to work. Ribitzki, 111 F.3d at 662. Plaintiff alleges that Decker breached his duty to Plaintiff. Compl. ¶ 7, ECF No. 1. For example, Plaintiff alleges that Decker failed to warn him of impending dangers, failed to provide him with a safe place to work, and failed to provide medical care and medication in a timely competent manner. Id.
"An employer is only liable under the Jones Act if the employer ... either knew or should have known of the dangerous condition[.]" Ribitzki, 111 F.3d at 663. Here, Plaintiff was employed as a seaman to fish on the Vessel. Compl. ¶ 6, ECF No. 1. In Plaintiff's declaration, Plaintiff claims that Decker did not have a first aid kit. Watts Decl. ¶ 3, ECF No. 23. It can be reasonably inferred that Decker knew or should have known of the danger of a seaman being impaled by a fish spine, and the danger that an injury will worsen without providing adequate medical supplies on the Vessel.
As to causation, Plaintiff alleges that his infection and ultimate paralysis of his right finger were the result of Decker's breach of duty.
Accepting the factual allegations of the Complaint as true, the Court should find that Plaintiff has established a negligence claim under the Jones Act. See TeleVideo Sys., 826 F.2d at 917-18.
B. The Unseaworthiness Claim
To establish a claim for unseaworthiness, Plaintiff must establish: (1) the warranty of seaworthiness extended to him and his duties; (2) his injury was caused by a piece of the ship's equipment or an appurtenant appliance; (3) the equipment used was not reasonably fit for its intended use; and (4) the unseaworthy condition proximately caused his injuries. Gebhard v. S.S. Hawaiian Legislator, 425 F.2d 1303, 1310-12 (9th Cir.1970); Faraola v. O'Neill, 576 F.2d 1364, 1366 (9th Cir.1978). A vessel's condition of unseaworthiness may arise from any number of circumstances, including an insufficient number of men assigned to perform a shipboard task, or the existence of a defective condition, however temporary, on a physical part of the ship. Usner v. Luckenbach Overseas Corp., 400 U.S. 494, 499, 91 S.Ct. 514, 517-18, 27 L.Ed.2d 562 (1971).
Plaintiff satisfies the first element because he was a seaman on the Vessel. Plaintiff claims in his declaration that Decker did not have a first aid kit, and that Decker used a kitchen knife to operate on his finger and lacerated his finger, resulting in infection and swelling and ultimately paralyzed his finger. Watts Decl. ¶ 3, ECF No. 23. Therefore, the infection, swelling and paralysis were caused by the lack of a first aid kit, which was "the existence of a defective condition" of the Vessel. Usner, 400 U.S. at 499. Thus, Plaintiff satisfies the second and the fourth elements. Because Decker used the kitchen knife to operate on Plaintiff's finger, which was not reasonably fit for its intended use, Plaintiff satisfies the third element. Therefore, the Court should find that Plaintiff has established a claim for unseaworthiness.
C. The Maintenance and Cure Claim
The obligation of maintenance and cure is not predicated on the fault of negligence of the ship owner. Aguilar v. Standard Oil Co. of N. J., 318 U.S. 724, 730 (1943). The ship owner is liable for the expense of curing a seaman's injury or sickness as an incident of the marine employer-employee relationship. Id. Plaintiff alleges that he was employed by Decker during all relevant times and was injured "as an incident of the marine employer-employee relationship." Id. Accepting Plaintiff's allegation as true, he has established a maintenance and cure claim.
In summary, Plaintiff has established all three claims.
4. Factor 4
The fourth Eitel factor inquires the sum of money at state in the action. Eitel, 782 F.2d at 1471. While the Court may generally take the factual allegations of the complaint as true, allegations relating to the amount of damages require an extensive evidentiary review. TeleVideo Sys., 503 F.3d at 917-18. The Court has reviewed the declarations submitted by Plaintiff and conducted an evidentiary hearing.
As an initial matter, "a claim of unseaworthiness serves as a duplicate and substitute for a Jones Act claim." The Dutra Group v. Batterton, 139 S.Ct. 2275, 2286 (2019). A plaintiff "cannot duplicate his recovery by collecting full damages on both claims because whether or not the seaman's injuries were occasioned by the unseaworthiness of the vessel or by the negligence of the master or members of the crew, ... there is but a single wrongful invasion of his primary right of bodily safety and but a single legal wrong." Id. at 2282 (internal quotation marks omitted); see also, Plamals v. The Pinar Del Rio, 277 U.S. 151, 156-57 (1928)) ("Seamen may invoke, at their election, the relief accorded by the old rules against the ship, or that provided by the new against the employer. But they may not have the benefit of both."). As such, although Plaintiff has invoked and established both the causes of action of the Jones Act and unseaworthiness, Plaintiff can only recovery damages concurrently.
The Ninth Circuit limits Jones Act damage award to pecuniary losses. Kopczynski v. The Jacqueline, 742 F.2d 555, 560-61 (9th Cir. 1984). Punitive damages are non-pecuniary. Id. at 561. However, "punitive damages for the willful and wanton disregard of the maintenance and cure obligation remain available as a matter of general maritime law." Atl. Sounding Co. v. Townsend, 557 U.S. 404, 129 S. Ct. 2561, 2563, 174 L. Ed. 2d 382 (2009). The Jones Act also allows a plaintiff to recover damages for pain and suffering. Cook v. Ross Island Sand & Gravel Co., 626 F.2d 746, 748 (9th Cir. 1980). Additionally, "[i]t is well-settled that a seaman may recover compensatory damages such as pain and suffering stemming from a ship owner's unreasonable failure to pay maintenance and cure." Sullivan v. Tropical Tuna, Inc., 963 F. Supp. 42, 46 (D. Mass. 1997) (citing Vaughan v. Atkinson, 369 U.S. 527, 530-31 (1962)).
a. Unpaid Earnings, Lost Earnings and Medical Expenses
Plaintiff declares and testified that Decker failed to pay his wages for the fishing trip for at least $1,800. Watts Decl. ¶ 6, ECF No. 23; ECF No. 28.
Plaintiff declares and testified that he was completely unable to work for ten months. Watts Decl. ¶ 8, ECF No. 23; ECF No. 28. Because he had been making an average of $5,000 a month in the fishing industry, he lost $50,000 earnings during the ten months. Watts Decl. ¶ 8, ECF No. 23. Plaintiff further declares that he was only able to work part-time "at minimum wage work" for nineteen months, earning $1,000 a month, $4,000 less than his prior monthly earnings. Id. Plaintiff lost $76,000 ($4,000 times 19) earnings during the nineteen-month part-time work. Id. Plaintiff seeks $126,000 ($5,000 plus $76,000) for lost earnings.
Plaintiff declares and testified that he incurred $35,260 in medical expenses. Watts Decl. ¶ 6, ECF No. 23; ECF No. 28. However, a review of the record shows that the only medical bill in the record is from Good Samaritan Reginal Medical Center in the amount of $33,352.94. Am. Carey Decl., Ex. 1, ECF No. 30-1. After Medicaid Adjustments of $22,904.37, Medicaid Insurance paid $10,448.57. Id. at 7. The total amount of liens placed against Plaintiff is $10,840.74, which includes the Medicaid Insurance payment of $10,448.57. Id. at Ex. 2. Based on the evidence of medical bills in the record, Plaintiff proved that his obligation of medical expenses is $10,840.74.
The record does not suggest any evidence of contributory negligence of Plaintiff. Fitzgerald v. U. S. Lines Co., 374 U.S. 16, 19, 83 S. Ct. 1646, 1649, 10 L. Ed. 2d 720 (1963) ("[A]ll lost earnings and medical expenses are recoverable on a negligence count, but under the Jones Act they are subject to reduction by the jury if the seaman has been contributorily negligent."). Accordingly, the Court should award Plaintiff the following pecuniary damages: unpaid earnings of $1,800, lost earnings of $126,000, and medical expenses of $10,840.74.
b. Maintenance
According to Plaintiff's declaration, he was unable to work at all for ten months from May 2017 through February 2018. Watts Decl. ¶ 9, ECF No. 23. Plaintiff seeks $15,000 in maintenance for the ten months, or 300 days, at a rate of $50 per day. Mot. J. 5, ECF No. 20. A seaman may recover, "in the discretion of the court, such amount as may be needful in the immediate future for the maintenance and cure of a kind and for a period which can be definitely ascertained." Calmar S. S. Corp. v. Taylor, 303 U.S. 525, 531-32, 58 S. Ct. 651, 655, 82 L. Ed. 993 (1938). The Court recommends an award of maintenance in the amount of $15,000.
c. Pain and Suffering
Plaintiff may recover pain and suffering both under the Jones Act and stemming from Decker's unreasonable failure to pay maintenance and cure. Cook, 626 F.2d at 748; Sullivan, 963 F. Supp. at 46. Plaintiff seeks pain and suffering in the amount of $1,000,000. Mot. J. 5, ECF No. 20. After Plaintiff's finger was impaled by a fish spine, Decker failed to provide first aid to Plaintiff because he did not have a first aid kit. Watts Decl. ¶ 3, ECF No. 23. Instead, Decker used a kitchen knife to cut the fish spine out causing infection and swelling in Plaintiff's finger. Id. Plaintiff experienced extreme and excruciating pain after his finger was injured. Id. ¶ 5. As a result of Decker's refusal to immediately take Plaintiff to shore, Plaintiff spent two weeks in the hospital including six days in intensive care. Id. ¶ 6. Plaintiff's index finger became necrotic and part of his finger had to be removed. Id. ¶ 8. His right-hand index finger is permanently impaired. Id. Plaintiff does not have former strength in that finger and cannot close his fist. Id. As a result, he is limited in using tools and could not return to fishing. Id.
Base on the record before the Court, the Court recommends an award of pain and suffering in the amount of $600,000.
d. Punitive Damages
Plaintiff seeks punitive damages in the amount of $1,000,000. Mot. J. 5, ECF No. 20. The Supreme Court has held that a seaman is entitled, as a matter of general maritime law, to seek punitive damages for his employer's alleged willful and wanton disregard of the employer's maintenance and cure obligation. Atlantic Sounding Co., Inc. v. Townsend, 557 U.S. 404, 424 (2009). The record shows that Decker had no antibiotics on the Vessel. Watts Decl. ¶ 5, ECF No. 23. When Plaintiff asked to be taken to shore, Decker refused, insisting that they remain at sea until the fish holds were full. Id. Decker did not return to shore until 3-4 days after he incurred the injury. Id. When Plaintiff demanded maintenance and cure, Decker refused to pay. Carey Decl. ¶¶ 7-8, ECF No. 21; Am. Carey Decl. ¶ 11, ECF No. 30 (citing Carey Decl., Ex. D, ECF No. 8). Decker also avoided service. Id. ¶ 3. Decker made no effort to help Plaintiff. Watts Decl. ¶ 10, ECF No. 23.
Decker's act clearly shows willful and wanton disregard of his maintenance and cure obligation. The Court recommends an award of punitive damages of $300,000.
e. Attorney's Fees and Costs
The Supreme Court established an exception to the normal "American rule" that litigants must bear their own costs, holding that a seaman may "recover attorneys' fees as damages where a shipowner was callous, willful, or recalcitrant in withholding [maintenance and cure] payments." Robinson v. Pocahontas, 477 F.2d 1048, 1051 (1st Cir.1973) (citing Vaughan, 369 U.S. at 530, 82 S.Ct. at 999). "When a ship operator fails to make a prompt, good faith investigation of a seaman's claim for maintenance and cure, or otherwise takes a 'callous' or 'recalcitrant' view of its obligations, the seaman may recover legal expenses on top of maintenance and cure." Rodriguez v. Bahama Cruise Line, Inc., 898 F.2d 312, 316 (2d Cir.1990). As discussed above, Decker exhibited the requisite degree of willfulness by refusing to pay maintenance and cure. The Court therefore should award Plaintiff reasonable attorney's fees and costs incurred for the maintenance and cure claim.
Additionally, the Ninth Circuit requires courts to consider the following factors in determining reasonable attorney's fees for a maintenance and cure claim:
(1) the time and labor required, (2) the novelty and difficulty of the questions involved, (3) the skill requisite to perform the legal service properly, (4) the preclusion of other employment by the attorney due to acceptance of the case, (5) the customary fee, (6) whether the fee is fixed or contingent, (7) time limitations imposed by the client or the circumstances, (8) the amount involved and the results obtained, (9) the experience, reputation, and ability of the attorneys, (10) the undesirability of the case, (11) the nature and length of the professional relationship with the client, and (12) awards in similar cases.Glynn v. Roy Al Boat Management Corp., 57 F.3d 1495, 1501 & n. 8 (9th Cir.1995) (citation omitted).
Plaintiff seeks $15,210 in attorney's fees which includes counsel's time spent in all three claims. Mot. J. 5, ECF No. 20; Carey Decl. ¶ 11, ECF No. 21. Because the three claims arise out of the same set of facts, it is unlikely that the Jones Act and unseaworthiness claims took counsel significantly extra time. It is also reasonable to infer that Decker's evasion of process led to additional counsel time. After considering the factors set forth in Glynn, the Court recommends an award of attorney's fees for the maintenance and cure claim in the amount of $15,210. The Court should also award Plaintiff's request for the costs of $1,649.
RECOMMENDATION
The Court should grant Plaintiff's Motion for Judgment (ECF No. 20) as follows:
| Unpaid earnings | $1,800 |
| Lost Earnings | $126,000 |
| Medical Expenses | $10,841 |
| Maintenance | $15,000 |
| Pain and Suffering | $600,000 |
| Punitive Damages | $300,000 |
| Attorney Fees | $15,210 |
| Attorney Costs | $1,649 |
This recommendation is not an order that is immediately appealable to the Ninth Circuit Court of Appeals. Any notice of appeal pursuant to Rule 4(a)(1), Federal Rules of Appellate Procedure, should not be filed until entry of the district court's judgment or appealable order. The parties shall have fourteen (14) days from the date of service of a copy of this recommendation within which to file specific written objections with the court. Thereafter, the parties shall have fourteen (14) days within which to file a response to the objections. Failure to timely file objections to any factual determination of the Magistrate Judge will be considered as a waiver of a party's right to de novo consideration of the factual issues and will constitute a waiver of a party's right to appellate review of the findings of fact in an order or judgment entered pursuant to this recommendation.
DATED this 28th day of April 2020.
s/ Mustafa T. Kasubhai
MUSTAFA T. KASUBHAI
United States Magistrate Judge