Joseph Wilcox v. Max Welders, L.L.C. , 794 F.3d 531 ( 2015 )


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  •       Case: 13-31281          Document: 00513128507              Page: 1      Date Filed: 07/24/2015
    IN THE UNITED STATES COURT OF APPEALS
    FOR THE FIFTH CIRCUIT
    United States Court of Appeals
    No. 13-31281
    Fifth Circuit
    FILED
    July 24, 2015
    JOSEPH R. WILCOX; LISA WILCOX,                                                             Lyle W. Cayce
    Clerk
    Plaintiffs–Appellants
    v.
    WILD WELL CONTROL, INCORPORATED; SUPERIOR ENERGY
    SERVICES, INCORPORATED,
    Defendants–Appellees
    ---------------------------------------------------------------------------------------------------------
    Cons. with 14-30137
    JOSEPH R. WILCOX; LISA WILCOX,
    Plaintiffs–Appellants
    v.
    MAX WELDERS, L.L.C.,
    Defendant–Appellee
    WILD WELL CONTROL, INCORPORATED; SUPERIOR ENERGY
    SERVICES, INCORPORATED,
    Defendants–Appellees–Appellants
    Appeals from the United States District Court
    for the Eastern District of Louisiana
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    No. 13-31281
    Before DENNIS, PRADO, and HIGGINSON, Circuit Judges.
    EDWARD C. PRADO, Circuit Judge:
    This appeal arises from injuries sustained by Plaintiff–Appellant Joseph
    R. Wilcox while welding on an offshore platform. Wilcox, an employee of
    Defendant–Appellee Max Welders, L.L.C., was working as the borrowed
    employee of Defendant–Appellee–Appellant Wild Well Control, Incorporated,
    a subsidiary of Defendant–Appellee–Appellant Superior Energy Services,
    Incorporated. Wilcox sued the Defendants under, inter alia, the Jones Act.
    Superior and Wild Well filed a cross-claim for indemnity from Max Welders
    pursuant to a Master Service Agreement (MSA) or, in the alternative, Vessel
    Boarding, Utilization and Hold Harmless Agreement (VBA) between Superior
    and Max Welders. The district court granted summary judgment to all
    Defendants on the Jones Act claims because it found that Wilcox is not a Jones
    Act seaman and granted summary judgment to Max Welders on indemnity
    because 1) the MSA was void under Louisiana law and 2) the VBA did not
    apply to Wilcox’s work. Wilcox, Superior, and Wild Well appeal these decisions.
    We affirm.
    I. FACTUAL AND PROCEDURAL BACKGROUND
    Max Welders is a contractor that provides various offshore construction,
    fabrication, and repair services. Max Welders employed Wilcox as a welder.
    During his employment with Max Welders, Wilcox worked in numerous
    locations, including a fabrication yard in Louisiana and on various rigs, barges,
    and vessels owned by Max Welders’ customers. Wilcox concedes that during
    his entire employment with Max Welders, he spent less than thirty percent of
    his time in service of any one vessel or group of vessels.
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    Energy Resource Technology GOM, Incorporated (ERT) hired Wild
    Well—a subsidiary of Superior—to decommission a well in the Gulf of Mexico
    (“the ERT job”). Wild Well contracted with Max Welders to provide welders to
    assist. Wilcox was one of the welders sent to work on the ERT job, which was
    expected to last for approximately two months. During this time, Wilcox was
    required to live on Wild Well’s barge, the D/B SUPERIOR PERFORMANCE,
    which was on site at the well to provide support to the decommissioning work.
    Superior previously owned the D/B SUPERIOR PERFORMANCE. Wilcox
    allegedly sustained injuries on June 5, 2012, when gasses exploded while he
    was welding inside on the well platform. Wild Well concedes that, at the time
    of the accident, Wilcox was its borrowed employee.
    Wilcox and his wife sued Max Welders, Superior, and Wild Well for
    negligence under the Jones Act, 46 U.S.C § 30104, and general maritime law
    (GML), or alternatively for vessel negligence against the D/B SUPERIOR
    PERFORMANCE under the Longshore and Harbor Workers’ Compensation
    Act (LHWCA), 33 U.S.C. § 905(b). Superior and Wild Well jointly filed a cross-
    claim alleging that Max Welders had agreed to indemnify and hold harmless
    Superior and its subsidiaries against any personal-injury claims brought by
    Max Welders’ employees pursuant to the 2004 MSA between Max Welders and
    Superior. They argued, in the alternative, that Max Welders owed them
    indemnity pursuant to a 2010 VBA between Superior and Wild Well.
    Max Welders moved for summary judgment on Wilcox’s Jones Act and
    GML claims, asserting that Wilcox was not a seaman. Max Welders also moved
    for summary judgment on Superior and Wild Well’s indemnity cross-claim,
    contending that the MSA and VBA did not provide indemnity for Wild Well’s
    demolition work for a third party. Superior and Wild Well then filed a cross-
    3
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    motion for summary judgment on their indemnity claims. The district court
    granted summary judgment to Max Welders on Wilcox’s Jones Act and GML
    claims as well as on Superior and Wild Well’s indemnity claims.
    Superior and Wild Well later moved for summary judgment on Wilcox’s
    Jones Act and GML claims, arguing that if Wilcox was not a seaman with
    respect to his employer, Max Welders, he was also not a seaman with respect
    to his borrowing employer, Wild Well. The district court granted this motion.
    The district court later granted summary judgment to Superior and Wild Well
    on Wilcox’s remaining claims for vessel negligence under the LHWCA.
    These consolidated cases encompass two appeals. First, Wilcox appeals
    the grant of summary judgment for Wild Well on Wilcox’s Jones Act and GML
    claims based on his seaman status. 1 Second, Wild Well and Superior appeal
    the grant of summary judgment for Max Welders on indemnity.
    II. DISCUSSION
    This Court has jurisdiction to review a district court’s final judgment
    pursuant to 28 U.S.C. § 1291. We review de novo a district court’s grant of
    summary judgment, viewing “all facts and evidence in the light most favorable
    to the non-moving party.” Juino v. Livingston Par. Fire Dist. No. 5, 
    717 F.3d 431
    , 433 (5th Cir. 2013). We apply the same standard as the district court in
    the first instance. Turner v. Baylor Richardson Med. Ctr., 
    476 F.3d 337
    , 343
    (5th Cir. 2007).
    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). A genuine dispute of material fact
    1   Wilcox does not appeal the grant of summary judgment on his LHWCA claims.
    4
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    exists when the “evidence is such that a reasonable jury could return a verdict
    for the nonmoving party.” Royal v. CCC & R Tres Arboles, L.L.C., 
    736 F.3d 396
    ,
    400 (5th Cir. 2013) (quoting Anderson v. Liberty Lobby, Inc., 
    477 U.S. 242
    , 248
    (1986)).
    A.     Wilcox’s Jones Act Claims
    The district court granted summary judgment for Wild Well and
    Superior because it found that Wilcox was not a Jones Act seaman. The
    Supreme Court has articulated a two-prong test to determine seaman status
    under the Jones Act: 1) “an employee’s duties must ‘contribut[e] to the function
    of the vessel or to the accomplishment of its mission,’” and 2) “a seaman must
    have a connection to a vessel in navigation (or to an identifiable group of such
    vessels) that is substantial in terms of both its duration and its nature.”
    Chandris, Inc. v. Latsis, 
    515 U.S. 347
    , 368 (1995) (quoting McDermott Int’l, Inc.
    v. Wilander, 
    498 U.S. 337
    , 355 (1991)).
    At issue in this appeal is the substantial-connection prong. 2 The
    “fundamental purpose” of this inquiry “is to . . . separate the sea-based
    maritime employees who are entitled to Jones Act protection from those land-
    based workers who have only a transitory or sporadic connection to a vessel in
    navigation.” 
    Id. at 368.
    “Land-based maritime workers do not become seamen
    because they happen to be working on board a vessel when they are injured,
    and seamen do not lose Jones Act protection when the course of their service
    to a vessel takes them ashore.” 
    Id. at 361.
    Following Barrett v. Chevron U.S.A.,
    Inc., 
    781 F.2d 1067
    (5th Cir. 1986) (en banc), we have generally “declined to
    find seaman status where the employee spent less than 30 percent of his time
    2The district court found a genuine issue of material fact regarding the contribution
    prong. Wild Well does not contest this finding.
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    aboard ship.” 
    Chandris, 515 U.S. at 367
    . The Supreme Court deemed this “an
    appropriate rule of thumb,” but noted that “departure from it will certainly be
    justified in appropriate cases.” 
    Id. at 371.
           Generally, the status of an employee who splits time between land and
    a vessel is “determined in the context of his entire employment with his current
    employer.” 
    Barrett, 781 F.2d at 1075
    (internal quotation marks omitted); see
    also 
    Chandris, 515 U.S. at 370
    –71. But if the employee “receives a new work
    assignment before his accident in which either his essential duties or his work
    location is permanently changed, he is entitled to have the assessment of the
    substantiality of his vessel-related work made on the basis of his activities in
    his new job.” 
    Barrett, 781 F.2d at 1075
    –76 (emphasis added); see also 
    Chandris, 515 U.S. at 371
    –72 (“[W]e see no reason to limit the seaman status inquiry . .
    . exclusively to an examination of the overall course of a worker’s service with
    a particular employer. When a maritime worker’s basic assignment changes,
    his seaman status may change as well.”). This reassignment exception applies
    only when an employee has “undergone a substantial change in status, not
    simply [by] serv[ing] on a boat sporadically.” Becker v. Tidewater, Inc., 
    335 F.3d 376
    , 389 (5th Cir. 2003) (emphasis added).
    We addressed the Barrett reassignment exception in a borrowed-
    employee context similar to Wilcox’s in New v. Associated Painting Services,
    Inc., 
    863 F.2d 1205
    (5th Cir. 1989). 3 The plaintiff worked for a painting
    company that sent employees to offshore drilling rigs and oil platforms. 
    Id. at 1207.
    The employee was regularly assigned to different vessels owned by
    Although New was decided before the Supreme Court’s seminal decision in Chandris,
    3
    we applied the Robison seaman-status test, which the Court “essentially accepted” in
    Chandris. Nunez v. B&B Dredging, Inc., 
    288 F.3d 271
    , 274–75 (5th Cir. 2002). Thus, New
    remains binding. See Jacobs v. Nat’l Drug Intelligence Ctr., 
    548 F.3d 375
    , 378 (5th Cir. 2008).
    6
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    unrelated entities. 
    Id. One week
    into an assignment to a drilling rig as a
    borrowed employee, the plaintiff sustained injuries in an accident. 
    Id. The employee
    argued that he was a seaman with regard to the painting company
    and the borrowing employer. 
    Id. Although he
    did not satisfy the thirty-percent
    requirement based on his entire employment with the painting company, the
    employee asserted that the court should look only to the time he worked for
    the borrowing employer because as a matter of law, he contended, the Barrett
    exception applied to his work as a borrowed employee. 
    Id. at 1208–09.
    We held
    1) that the plaintiff’s status as a borrowed employee did not make him a Jones
    Act seaman; and 2) that because the summary-judgment evidence showed no
    permanent change to his essential work duties or work location, his status
    must be determined by looking to his entire employment with the painting
    company. 
    Id. 4 Wilcox
    argues that the district court erred in its substantial-connection
    analysis by refusing to determine Wilcox’s status by reference to his period of
    employment with Wild Well, rather than his entire employment with Max
    Welders. 5 Wilcox disclaims reliance on the Barrett exception, and for good
    4 We followed a similar analysis in a post-Chandris case. In Becker v. Tidewater, Inc.,
    
    335 F.3d 376
    (5th Cir. 2003), we refused to apply the reassignment exception to a land-based
    worker temporarily reassigned to a vessel. 
    Id. at 390–91.
           5 Wilcox devotes a substantial portion of his brief to arguing that the district court
    granted summary judgment based on dictum from New v. Associated Painting Services, Inc.,
    
    1987 WL 4944
    (E.D. La. May 8, 1987). He suggests that the New district court created, and
    the district court in this case applied, a per se rule that a borrowed employee’s seaman status
    must always be determined by looking at the time spent working for the original employer.
    This argument mischaracterizes the district court’s summary-judgment analysis in
    this case. The district court carefully analyzed and applied our New opinion, which affirmed
    the lower court. Wilcox also ignores the context of the summary-judgment order: in its prior
    order granting summary judgment to Max Welders, the district court had already addressed
    the argument that Wilcox’s status should be determined based on the time spent as Wild
    Well’s borrowed employee. When the district court disposed of Wild Well’s summary
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    reason—there is no evidence in the record to support application of the
    reassignment exception in this case. Wilcox’s case presents facts that are
    strikingly similar to those in New. Like the borrowed employee in New, Wilcox
    was not permanently reassigned to work on Wild Well’s vessel—the project
    was expected to last for approximately two months. Nor did his essential duties
    change—his primary duty continued to be welding. Wilcox does not point to
    any evidence suggesting a “fundamental change in status,” 
    Becker, 335 F.3d at 390
    , which would allow us to assess the substantial-relation prong with sole
    reference to Wilcox’s time as a borrowed employee with Wild Well.
    Conceding that the Barrett exception does not apply here, Wilcox instead
    asserts that he “started a new job with a new employer when he began work
    as Wild Well’s borrowed employee,” making Wild Well his “current employer,”
    
    Chandris, 515 U.S. at 366
    , for the purposes of the seaman-status inquiry.
    Thus, Wilcox concludes, he has satisfied the substantial-connection prong
    because he spent more than thirty percent of his time with Wild Well aboard a
    vessel. He concedes that there is no direct support for this conclusion but
    argues that it is “suggested” by other pre-Chandris cases that recognize that a
    borrowed employee can become a seaman with regard to his borrowing
    employer. We decline to adopt such a rule.
    The Supreme Court has recognized that in determining seaman status,
    “it [is] preferable to focus upon the essence of what it means to be a seaman
    and to eschew the temptation to create detailed tests to effectuate the
    congressional purposes, tests that tend to become ends in and of themselves.”
    
    Id. at 369.
    Our thirty-percent rule and the Barrett reassignment exception
    judgment motion, the only remaining question was “whether the seaman status finding that
    was made with respect to Max Welders should also be applied to Wild Well.”
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    “get[] at the . . . basic point [that] [t]he Jones Act remedy is reserved for sea-
    based maritime employees whose work regularly exposes them to the special
    hazards and disadvantages to which they who go down to sea in ships are
    subjected.” 
    Chandris, 515 U.S. at 370
    (internal quotation marks omitted). We
    do not here adopt a bright-line rule that courts performing the seaman-status
    inquiry must always look to an employee’s entire employment with his nominal
    employer rather than his borrowing employer. 6 Nevertheless, we also decline
    to adopt a rule that borrowed-employee status automatically requires courts
    look only to his period of employment with the borrowing employer. 7
    Wilcox supports his argument with Roberts v. Williams–McWilliams Co.,
    
    648 F.2d 255
    (5th Cir. 1981), in which this Court held that a borrowed
    employee was a seaman with regard to his borrowing employer. See 
    id. at 262.
    In Roberts, we found “no reason to distinguish [the plaintiff] because he
    received his paycheck from the [nominal employer].” 
    Id. at 262.
    There, the
    employee was under the complete control of the borrowing employer; he was
    sent to work on the vessel for an indefinite period of time and was expected to
    remain on the vessel until the completion of the project. 
    Id. Importantly, the
    employee was assigned to work for the borrowed employer on his second day of
    work for the nominal employer. 
    Id. at 257–58.
    Thus, the distinction at issue
    6 Such a rule would enable employers to contract around Jones Act rights. See Spinks
    v. Chevron Oil Co., 
    507 F.2d 216
    , 225 (5th Cir. 1975) (rejecting a rule that would “result in
    defeating Jones Act rights through contractual manipulations”), overruled on other grounds
    by Gautreaux v. Scurlack Marine, Inc., 
    107 F.3d 331
    (5th Cir. 1997) (en banc).
    7 Such a rule would be inconsistent with our reasoning in New—in which, after finding
    that the Barrett exception did not apply, we concluded that the district court “applied the
    proper legal standard” by reviewing the borrowed employee’s entire employment with his
    nominal 
    employer. 863 F.2d at 1208
    –09. Such a rule would also result in workers walking
    “into and out of [Jones Act] coverage in the course of his regular duties.” See 
    Chandris, 515 U.S. at 363
    .
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    here—entire period of employment versus period of employment with the
    borrowing employer—was inconsequential in Roberts.
    Here, there is good reason to distinguish Wilcox from Wild Well’s
    permanent employees. While employed by Max Welders, Wilcox worked for 34
    different customers on 191 different jobs, both offshore and onshore. He was
    assigned to work for Wild Well on the D/B SUPERIOR PERFORMANCE for
    one specific project, which had a clear end date only two months after it began.
    Moreover, testimony indicates that, although crew would usually stay on a
    vessel for an entire job, they could request relief and leave the vessel before the
    job was complete.
    Focusing on the “essence of what it means to be a seaman,” 
    Chandris, 515 U.S. at 369
    , we cannot say Wilcox demonstrated a genuine issue of
    material fact from which a reasonable jury could conclude that he qualifies for
    seaman status under the Jones Act. Therefore, we affirm the district court’s
    grant of summary judgment to Wild Well on Wilcox’s Jones Act claims.
    B.     The Indemnity Cross-Claims
    We now turn to the district court’s grant of summary judgment to Max
    Welders on Superior and Wild Well’s indemnity claims. Because we affirm
    summary judgment on Wilcox’s remaining claims against all Defendants, we
    need only address Max Welders’ liability for defense costs. Superior and Wild
    Well filed a cross-claim for indemnity from Max Welders pursuant to the MSA
    or, in the alternative, the VBA between Superior and Max Welders.
    1. The MSA
    The MSA that Max Welders and Superior entered into in April 2004
    contains an indemnity-and-defense provision. The district court assumed
    without deciding that the MSA applied to Wilcox’s work and held the MSA’s
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    “obligations to defend [or] indemnify . . . are void and unenforceable” under the
    Louisiana Oilfield Anti-Indemnity Act (LOAIA).
    Superior and Wild Well argue that this was error with reference to two
    key cases. In Meloy v. Conoco, Inc., 
    504 So. 2d 833
    (La. 1987), the Louisiana
    Supreme Court made clear that the LOAIA “does not apply where the
    indemnitee is not negligent or at fault,” 
    id. at 839.
    Thus, “the indemnitor’s
    obligation for cost of defense cannot be determined until there has been a
    judicial finding that the indemnitee is liable or that the charges against it were
    baseless.” 
    Id. In Melancon
    v. Amoco Production Co., 
    834 F.2d 1238
    (5th Cir.
    1988), we affirmed summary judgment for a borrowing employer on an
    employee’s LHWCA claim. 
    Id. at 1247–48.
    Applying Meloy, we held that the
    district court erred in finding that the LOAIA voided the borrowing employer’s
    indemnity agreement with the nominal employer and awarded the borrowing
    defense costs. 
    Id. at 1248.
          Max Welders argues that Wild Well and Superior have waived their
    argument that they are entitled to attorneys’ fees under Meloy and Melancon
    because they did not present this argument to the district court. Superior and
    Wild Well counter that they could not raise their argument because they “were
    not conclusively determined to be ‘not negligent’” until the district court
    dismissed Wilcox’s final claim against them on February 14, 2014, “after the
    district court’s Scheduling Order deadline” for pretrial motions.
    “An argument not raised before the district court cannot be asserted for
    the first time on appeal.” XL Specialty Ins. Co. v. Kiewit Offshore Servs., Ltd.,
    
    513 F.3d 146
    , 153 (5th Cir. 2008) (citing Stokes v. Emerson Elec. Co., 
    217 F.3d 353
    , 358 n.19 (5th Cir. 2000)). A party preserves an argument only if it is
    “raised to such a degree that the trial court may rule on it.” 
    Id. (quoting Butler
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    Aviation Int’l, Inc. v Whyte (In re Fairchild Aircraft Corp.), 
    6 F.3d 1119
    , 1128
    (5th Cir. 1993)), abrogated on other grounds by Tex. Truck Ins. Agency, Inc. v.
    Cure (In re Dunham), 
    110 F.3d 286
    (5th Cir. 1997).
    Superior and Wild Well did not have to wait for a conclusive
    determination of their liability to raise Meloy and Melancon. In its indemnity
    motion for summary judgment, Max Welders argued that the MSA’s indemnity
    agreement was void under the LOAIA. Superior and Wild Well filed a cross-
    motion for summary judgment, but only argued that the LOAIA did not govern
    the MSA because it did not “pertain to a well.” They could have argued in their
    opposition that Meloy and Melancon precluded the district court from
    determining the validity of the indemnity provision before liability was
    determined, but they did not. 8 Because Wild Well and Superior failed to raise
    the Meloy–Melancon argument at the summary-judgment stage, we conclude
    that they have waived the argument on appeal. See Provident Life & Accident
    Ins. Co. v. Goel, 
    274 F.3d 984
    , 990 n.11 (5th Cir. 2001) (“As a general rule,
    arguments . . . not presented in the district court in connection with a summary
    judgment motion are waived on appeal and the appellate court will be unable
    to consider these materials in its review of the district court’s decision.”
    (quoting in a parenthetical 11 James Wm. Moore et al., Moore’s Federal
    Practice ¶ 56.41[3][c] (3d ed. 1997))).
    8  Superior and Wild Well did cite to Meloy in the law section of their cross-motion for
    summary judgment on indemnity, noting that “[i]f the LOAIA applies to the Superior/Max
    MSA, then the defense, indemnity and insurance provisions will be void as a matter of public
    policy if there is any negligence on the part of Superior/Wild Well.” (citing Meloy, 
    504 So. 2d 833
    ). However, in the pertinent section of their brief, they only argue that the LOAIA does
    not apply because the agreement does not pertain to a well. This was most likely a strategic
    choice: because they also sought summary judgment on indemnity, the Meloy–Melancon issue
    could have precluded summary judgment in their favor.
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    Because Superior and Wild Well have waived their argument for
    attorneys’ fees based on Melancon and Meloy, we affirm the district court’s
    summary-judgment holding that the MSA was void under the LOAIA.
    2. The VBA
    Superior and Wild Well also argue that they are entitled to defense costs
    and indemnity under the Vessel Boarding, Utilization and Hold Harmless
    Agreement (VBA) between Superior and Max Welders. 9 The district court
    rejected this argument, but it did not distinguish between indemnity for Wild
    Well and indemnity for Superior in its analysis. After concluding that the VBA
    did not apply to Wild Well, the district court granted summary judgment to
    Max Welders against both Wild Well and Superior. We address each indemnity
    issue in turn.
    The VBA states it was “executed by Contractor [Max Welders] for the
    purpose of obtaining access from Owner [Superior] to vessels owned, chartered
    and/or operated by Owner . . . in order to allocate the risks and liabilities
    arising out of Owner granting to Contractor such access.” It further provides:
    Contractor agrees to defend, indemnify and hold Owner harmless
    from and against any claims, losses, or demands of any kind
    arising as a result of personal injury, death or disease, that may
    be asserted by Contractor . . . or on behalf of any of its or their
    employees . . . no matter how occasioned . . . .
    a. Indemnity for Wild Well
    Before the district court, Superior and Wild Well argued that the VBA
    was intended as an addendum to the MSA that provided indemnity in
    9  Max Welders points out that the VBA is not countersigned by Superior, and argues
    “[t]his alone renders the VBA inapplicable.” However, it cites no authority for this
    proposition. We find this argument to be inadequately briefed and abandoned. See Fed. R.
    App. P. 28(a)(8); Yohey v. Collins, 
    985 F.2d 222
    , 225 (5th Cir. 1993).
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    connection with the D/B SUPERIOR PERFORMANCE, regardless of whether
    it was owned by Wild Well or Superior. 10 They conceded that the plain
    language of the agreement did not reflect this intent, but argued, based on
    parol evidence, that the VBA should be reformed to reflect that intent. They
    asserted that because this was a reformation issue, rather than an ambiguity
    issue, the parol evidence could be considered. The district court found the
    contract to be unambiguous and found the defendant’s reformation argument
    to be an “end-run” around the parol evidence rule. On appeal, Superior and
    Wild Well raise nearly identical arguments.
    “Reformation is an equitable remedy used to correct errors or mistakes
    in contracts.” Am. Elec. Power Co. v. Affiliated FM Ins. Co., 
    556 F.3d 282
    , 287
    (5th Cir. 2009) (internal quotation marks omitted). The party seeking
    reformation bears the burden of establishing mutual error in the contract’s
    creation. 
    Id. Ordinarily the
    party must only show mistake by a preponderance
    of the evidence; but when a party seeks to reform a provision “to provide
    coverage for a ‘substantially different and greater risk’ than expressly covered,
    the party must demonstrate a mutual error by clear-and-convincing evidence.”
    
    Id. at 287
    n.4 (quoting Samuels v. State Farm Mut. Auto. Ins. Co., 
    939 So. 2d 1235
    , 1240 (La. 2006)).
    In American Electric Power Co. v. Affiliated FM Insurance Co., we
    interpreted an insurance agreement that had been adopted by the defendant
    insurance company through a “prior loss” clause in its coverage agreement
    with the plaintiff. 
    Id. at 284–85.
    The clause obligated the defendant to cover a
    loss if the prior insurance agreement did. 
    Id. The prior
    agreement covered
    10 Superior owned the D/B SUPERIOR PERFORMANCE when the VBA was signed
    in 2010 but transferred the vessel to Wild Well in 2011, prior to Wilcox’s injury.
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    losses for the company and “any subsidiary corporation now existing or
    hereafter created or acquired.” 
    Id. at 285.
    The question was whether this
    provision covered subsidiary LLCs. 
    Id. Before the
    district court, the plaintiff
    sought to introduce affidavits from the original parties to the agreement
    evincing that they intended to include LLCs in the coverage. 
    Id. The district
    court, granting summary judgment for the defendant insurance company,
    found that “corporation” was unambiguous and, therefore, “struck the
    affidavits as impermissible parol evidence.” 
    Id. The plaintiff
    company filed a
    Rule 59(e) motion seeking reformation to match the original intent of the
    parties; the district court denied the motion. 
    Id. This Court
    agreed that “corporation” was unambiguous and parol
    evidence was properly excluded. 
    Id. at 286–87.
    We also affirmed the refusal to
    reform the agreement in part because “the use of the term ‘corporation’ is not
    the type of ‘error’ that reformation is intended to remedy.” 
    Id. at 288.
    We noted
    that the plaintiff “argue[d] that the original parties had a broader-than-usual
    meaning in mind when they purposefully included the word. In effect, [the
    plaintiff] attempt[ed] to make an end-run around the parol-evidence rule by
    framing its argument as a request for reformation.” 
    Id. American Electric
    defeats Superior and Wild Well’s reformation
    argument. The VBA defines “Owner” as “Superior Energy Services, L.L.C.”
    There is nothing ambiguous about this term, which Superior and Wild Well
    now contend must be read to include all companies affiliated with Superior.
    The agreement clearly covers “vessels owned, chartered and/or operated by”
    Superior.” As in American Electric, the parties seek to use parol evidence to
    show “the original parties had a broader-than-usual meaning in mind when
    they purposely included the word,” 
    id. Moreover, there
    is absolutely nothing in
    15
    Case: 13-31281    Document: 00513128507      Page: 16    Date Filed: 07/24/2015
    No. 13-31281
    the agreement that even suggests it is meant as an addendum to the MSA, a
    document executed six years prior.
    Superior and Wild Well argue that American Electric is distinguishable
    because “reformation of the contract at issue [in that case] would have been to
    the detriment of a third party.” It is true that part of our reasoning in that case
    was that the requested reformation would hurt a third party. See 
    id. at 287–
    88. But Superior and Wild Well do not explain how the alleged mistake—a
    failure to include language in the contract indicating that “Owner” referred not
    just to Superior, but also to any subsidiary it sold a vessel to—is “the type of
    ‘error’ that reformation is intended to remedy,” 
    id. at 288.
    To allow Superior
    and Wild Well, in spite of unambiguous contract language, to introduce
    affidavits of its employees to show that the agreement was meant to include
    Wild Well and serve as an addendum to the MSA would most certainly be “an
    end-run around the parol-evidence rule . . . fram[ed] . . . as a request for
    reformation,” 
    id. b. Indemnity
    for Superior
    Superior also argues that even if the VBA does not provide for Wild
    Well’s defense costs, “Superior had to defend itself in this case against
    allegations that it was negligent as the owner of the D/B SUPERIOR
    PERFORMANCE.” Therefore, Superior argues, it is entitled to defense costs
    for defending against these allegations. We disagree.
    The opening paragraph of the VBA states that it was “executed by
    Contractor [Max Welders] for the purpose of obtaining access from Owner
    [Superior] to vessels owned, chartered and/or operated by Owner, to provide
    employees of Contractor with working, living or operating support aboard the
    vessels of Owner, and in order to allocate the risks and liabilities arising out
    16
    Case: 13-31281     Document: 00513128507      Page: 17   Date Filed: 07/24/2015
    No. 13-31281
    of Owner granting to Contractor such access.” This statement makes clear that
    the risks and liabilities that are the subject of the VBA are those that arise out
    of Superior allowing Max Welders’ employees to live, work, and operate aboard
    vessels that are owned and/or operated by Superior. Reading the indemnity
    provision’s coverage for “claims . . . asserted . . . on behalf of [Max Welders’]
    employees” in the context of the VBA’s opening language, it is clear that the
    parties only intended indemnity for claims of employees that had access to
    Superior’s vessels. There was no Superior-owned vessel involved in Wilcox’s
    injury, and therefore the VBA does not provide for defense costs. The
    unambiguous language of the VBA does not show that the parties intended it
    to cover any suit in which a Max Welders employee mistakenly or frivolously
    claims that a vessel was owned by Superior.
    III. CONCLUSION
    For the foregoing reasons, we AFFIRM the district court’s grant of
    summary judgment as to Wilcox’s Jones Act claims and Superior and Wild
    Well’s indemnity claims.
    17
    

Document Info

Docket Number: 14-30137

Citation Numbers: 794 F.3d 531

Filed Date: 7/24/2015

Precedential Status: Precedential

Modified Date: 1/12/2023

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