Cain v. Transocean Offshr US ( 2008 )

REVISED MARCH 13, 2008
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
No. 05-30963 February 21, 2008
Charles R. Fulbruge III
Clerk
ROCKY H CAIN
Plaintiff - Appellee
v.
TRANSOCEAN OFFSHORE USA, INC; SEDCO FOREX CORP
Defendants - Third Party Plaintiffs
- Appellants
v.
FONTANA CENTER LLC
Third Party Defendant - Appellee
Appeal from the United States District Court
for the Western District of Louisiana
Before KING, GARZA, and OWEN, Circuit Judges.
KING, Circuit Judge:
This case requires us to consider the continued viability of our
longstanding precedent holding that a watercraft under construction is not a
“vessel in navigation” for purposes of the Jones Act. We hold that the Supreme
Court’s decision in Stewart v. Dutra Construction Co., 543 U.S. 481 (2005), has
not effectively overruled that precedent because the decision did not concern or
No. 05-30963
address the point at which a vessel-to-be actually becomes a vessel. We
therefore REVERSE the district court’s denial of summary judgment and
REMAND for further proceedings.
I. Background
In 1996, Plaintiff-Appellee Rocky Cain began working as a driller on a
semi-submersible drilling rig in the Gulf of Mexico for Sonat Offshore USA, Inc.
Sonat later became part of Defendant-Appellant Transocean Offshore USA, Inc.
On March 1, 2000, Transocean assigned Cain as a toolpusher to the “Cajun
Construction Site” in Singapore. Cain worked in Singapore for approximately
six months at the PPL Shipyard, where the M/V CAJUN EXPRESS was under
construction. The CAJUN EXPRESS is a fifth-generation semi-submersible
mobile offshore drilling rig designed to drill for oil and gas. Cain was expected
to continue working on the CAJUN EXPRESS, or a sister rig, after construction
was complete. Cain supervised a drill crew of seven men and was responsible
for overseeing safety issues and commissioning the drilling equipment.
During the first half of 2000, the CAJUN EXPRESS underwent sea trials
to ensure that the power generation and navigation systems worked and that the
structure was watertight for transit. With tugboat assistance, the CAJUN
EXPRESS was then towed with men and equipment aboard to Grand Isle,
Louisiana. During the journey, workers continued to build the rig, and Cain
continued to test equipment. Upon arriving in the Gulf of Mexico, the CAJUN
EXPRESS was moored in a “floating shipyard” for completion of construction.
Although the rig was capable of self-propulsion, it was not fully capable of
operating as a semi-submersible drilling rig. The necessary construction still
included installation of vital pipe-handling equipment and “blisters,” which are
large steel boxes welded to the rig to increase its buoyancy. Daniel Haslam, a
Transocean engineer, testified that when it arrived in the Gulf of Mexico the
CAJUN EXPRESS could lay pipe only under limited weather conditions.
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However, as a fifth generation semi-submersible unit, the most state of the art
in the industry, the CAJUN EXPRESS was not designed to operate only under
limited conditions. Haslam testified that no drilling contractor would have
found the CAJUN EXPRESS fit for the purpose of drilling a deepwater well in
the Gulf of Mexico.
On September 10, 2000, Cain was working on board the CAJUN
EXPRESS. At that time, the blisters still had not been installed and the drilling
systems had not been commissioned. Cain entered a warehouse located on board
the rig to retrieve a part for a member of the drill crew, whereupon he struck his
head on a low-hanging light fixture and was injured. A neurosurgeon later
examined Cain and recommended that he undergo physical therapy. Cain
received physical therapy and continued to work on board the CAJUN
EXPRESS. In April or May 2001, the CAJUN EXPRESS was finally completed
and began drilling operations in the Gulf of Mexico.
Cain continued to work as a toolpusher on the CAJUN EXPRESS but was
subsequently diagnosed with a herniated disc. In September 2001, he
discontinued work to undergo a cervical discectomy and fusion. Cain returned
to work in December 2001, when Transocean assigned him to a “work
hardening” program at the Fontana Center, a facility in Lafayette, Louisiana.
While participating in the work hardening program, Cain allegedly experienced
elevated blood pressure and suffered additional injuries.
Cain filed suit under the Jones Act, alleging that his injuries were the
result of Transocean’s negligence and the unseaworthiness of the CAJUN
EXPRESS. He also alleged that Transocean was negligent in assigning him to
the work hardening program. Transocean moved for summary judgment,
arguing that Cain was not a Jones Act seaman at the time of his injury because
the CAJUN EXPRESS was not yet a “vessel in navigation.” The district court
denied Transocean’s motion, concluding that the Supreme Court’s decision in
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Stewart had overruled Fifth Circuit precedent concerning watercraft under
construction. The district court held that the CAJUN EXPRESS was a vessel at
the time of Cain’s injury because under Stewart it was capable of transporting
workers and equipment over water. This court granted Transocean’s petition for
leave to appeal the district court’s denial of summary judgment. Fontana Center
has not submitted a brief and has not raised any arguments on appeal.
II. Discussion
We review the district court’s denial of summary judgment de novo.
Solano v. Gulf King 55, 212 F.3d 902, 905 (5th Cir. 2000). “Summary judgment
is proper if the evidence shows the existence of no genuine issue of material fact
and that the moving party is entitled to judgment as a matter of law.” Id.Transocean argues on appeal that under our established precedent the
CAJUN EXPRESS was not a vessel in navigation, and therefore Cain was not
a Jones Act seaman, because the rig was still under construction at the time of
Cain’s injury. It further argues that the Supreme Court’s decision in Stewart
has effected no change on our prior case law. We agree with both contentions.
A. “Seaman” status and our established precedent
We begin by describing two of the principal remedies available to injured
workers who ply their trade in connection with the sea: the Jones Act and the
Longshore Harbor Workers’ Compensation Act (“LHWCA”). The two Acts are
mutually exclusive compensation regimes. Becker v. Tidewater, Inc., 335 F.3d
376, 386 (5th Cir. 2003). The Jones Act permits a “seaman” to sue his employer
for personal injuries suffered as a result of the employer’s negligence. Park v.
Stockstill Boat Rentals, Inc., 492 F.3d 600, 602–03 (5th Cir. 2007) (citing 46
U.S.C. § 30104(a)). Such an action allows for potentially unlimited damages and
is in contrast to the generally prescribed remedial scheme available to maritime
workers under the LHWCA. See Becker, 335 F.3d at 386–87. Congress did not
define the term “seaman,” however, and left the courts to decide which maritime
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No. 05-30963
employees were covered by the Jones Act. Chandris, Inc. v. Latsis, 515 U.S. 347,
354 (1995).
The LHWCA provides the exclusive remedy to land-based workers who fall
within its provisions. Id. at 355. It specifically excludes from its coverage “a
master or member of a crew of any vessel.” 33 U.S.C. § 902(3)(G). The Supreme
Court has held this exclusion to be a refinement of the term “seaman” under the
Jones Act. Chandris, 515 U.S. at 355–56. Thus, a key requirement for Jones Act
coverage is actually found in the LHWCA. Id.Under the Jones Act, a “seaman” is a term of art for an employee whose
duties “contribut[e] to the function of the vessel or to the accomplishment of its
mission” and who has “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, 515 U.S. at 368 (internal quotation marks
and citation omitted); see also Garret v. Dean Shank Drilling Co., 799 F.2d 1007,
1009 (5th Cir. 1986) (“The worker is a seaman if he is assigned permanently to
a vessel in navigation or performs a substantial part of his work on the vessel,
contributing to the function of the vessel or to the accomplishment of its
mission.”). The existence of a “vessel” is thus crucial to determining seaman
status under the Jones Act. Holmes v. Atl. Sounding Co., 437 F.3d 441, 446 (5th
Cir. 2006).
We have long held that the Jones Act analysis requires a watercraft to be
“in navigation,” and we have drawn a distinction between completed crafts and
crafts that are under construction. A maritime worker “assisting in the building
and ultimate commissioning of a launched but uncompleted vessel floating or
maneuvering in navigable waters is not a seaman within the meaning of the
Jones Act, because his vessel is not yet an instrumentality of commerce—private
or public—and is therefore not ‘in navigation.’” Williams v. Avondale Shipyards,
Inc., 452 F.2d 955, 958 (5th Cir. 1971). In Williams, we held that a launched
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No. 05-30963
ship conducting sea trials was not “in navigation” because it was not yet being
used for its intended purpose. Id.Similarly, in Garret, we held that an offshore drilling rig was not a vessel
in navigation because, at the time of the plaintiff’s injury, the structure was still
undergoing final construction to make it operational as an oil and gas drilling
rig. 799 F.2d at 1009. We noted that the structure had never been engaged as
an instrument of commerce and held that a “nonmerchant vessel is in navigation
if it is engaged in its expected duties on navigable waters.” Id.In the instant case, the CAJUN EXPRESS was still under construction at
the time of Cain’s injury. Although the rig was capable of self-propulsion and
had run some test pipe, it lacked vital equipment to make it fully operational as
an oil and gas drilling rig. Indeed, as Daniel Haslam testified, no drilling
contractor would have found the CAJUN EXPRESS fit to drill a deepwater well
in the Gulf of Mexico. The CAJUN EXPRESS was not finally completed and
placed into service until April or May 2001, after Cain was injured. Thus, under
established Fifth Circuit precedent, the CAJUN EXPRESS was not a vessel in
navigation and Cain was not a Jones Act seaman.
B. Stewart
We now turn to the Supreme Court’s decision in Stewart v. Dutra
Construction Company. In Stewart, the Court addressed whether a dredge
known as the SUPER SCOOP was a vessel under the LHWCA. 543 U.S. at 484.
Although the case specifically concerned the LHWCA, we have recognized that
Stewart’s analysis of the term “vessel” applies equally to the LHWCA and to the
Jones Act. Holmes, 437 F.3d at 448.
The SUPER SCOOP was a floating platform with a clamshell bucket
suspended beneath the water used to remove silt from the ocean floor. Stewart,
543 U.S. at 484. The dredge was engaged in digging a trench beneath Boston
Harbor as part of the “Big Dig” project. Id. It had limited means of self-
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propulsion and was typically moved by tugboat, but it could move short distances
by manipulating its anchors and cables. Id.The First Circuit applied its test for vessel status found in DiGiovanni v.
Traylor Bros., 959 F.2d 1119, 1123 (1st Cir. 1992) (en banc), which had held that
“if a barge . . . or other float’s purpose or primary business is not navigation or
commerce, then workers assigned thereto for its shore enterprise are to be
considered seamen only when it is in actual navigation or transit at the time of
the plaintiff’s injury.” Id. at 485–86 (internal quotation marks omitted). The
First Circuit held that the SUPER SCOOP was not a vessel because any
navigation was incidental to the craft’s primary function of construction. Id. at
486. It also found significant the dredge’s stationary position at the time of the
plaintiff’s injury. Id.
The Supreme Court rejected the First Circuit’s test for vessel status,
concluding that although Congress did not define “vessel” in the LHWCA or the
Jones Act, it had already defined “vessel” elsewhere at the time both acts were
passed. Id. at 487–88. Specifically, under 1 U.S.C. § 3 (formerly § 3 of the
Revised Statutes of 1873), a vessel “includes every description of watercraft or
other artificial contrivance used, or capable of being used, as a means of
transportation on water.” Significantly, § 3 codified the meaning that the term
“vessel” had acquired in general maritime law, and the Court noted the historic
case law prior to the Jones Act and the LHWCA where courts had often used
§ 3’s definition to conclude that dredges were vessels. Id. at 488–90 & n.5. The
early case law showed that at the time the Jones Act and LHWCA were passed
in the 1920s, a structure’s status as a vessel depended on whether the structure
was a means of transportation. Id. at 491.
Relying on § 3, the Court held that a vessel “is any watercraft practically
capable of maritime transportation, regardless of its primary purpose or state
of transit at a particular moment.” Id. at 497. In other words, the Court
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rejected the First Circuit’s two-pronged test, which had asked whether a craft
was used primarily for transportation, and if not whether the craft was
motionless or moving at the time of the plaintiff’s injury. The Court looked only
to whether the dredge could be used for transportation. Because the SUPER
SCOOP was not only capable of transporting men and equipment but had
actually done so, the Court found that the dredge was a vessel for purposes of
the LHWCA. Id. at 495.
With respect to the requirement that a vessel be “in navigation,” the Court
clarified that the requirement was meant to show only that structures could lose
their vessel status if they are withdrawn from the water for extended periods.
Id. at 496. The “in navigation” requirement does not stand apart from § 3 and
“is relevant to whether the craft is ‘used, or capable of being used’ for maritime
transportation.” Id. But “[t]he question remains in all cases whether the
watercraft’s use ‘as a means of transportation on water’ is a practical possibility
or merely a theoretical one.” Id.
C. Stewart and vessels-to-be
The district court held that the CAJUN EXPRESS was a vessel under
Stewart because not only was it capable of transportation but it had also
transported workers and equipment from Singapore to the Gulf of Mexico. We
disagree, however, that Stewart was intended to apply to watercraft that are still
under construction. “[W]e cannot overrule the decision of a prior panel unless
such overruling is unequivocally directed by controlling Supreme Court
precedent.” United States v. Zuniga-Salinas, 945 F.2d 1302, 1306 (5th Cir. 1991)
(emphasis added). We conclude that our well-settled body of law in this area has
not been effectively overruled.
The language in Stewart is admittedly broad, and we have recognized that
the Court’s decision significantly enlarges the types of unconventional and
special purpose watercraft that now must be considered vessels that might not
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have met the test before Stewart. See Holmes, 437 F.3d at 448. Stewart began,
however, by framing the issue before it narrowly: “whether a dredge is a ‘vessel’
under [the LHWCA].” Stewart, 543 U.S. at 484. The Court decided that specific
question, concluding that the First Circuit’s focus on an existing craft’s purpose
and movement was inconsistent with the text of § 3 and the established meaning
of “vessel” in general maritime law. We thus read Stewart’s instruction that a
craft is a vessel if it is capable of marine transportation in the context of that
case to negate the First Circuit’s test for an established structure.
Stewart examined an already-completed structure in use for its intended
purpose. Stewart did not concern what to do with ships and other structures
under construction, and so the Court did not address whether § 3’s definition of
vessel applies to incomplete structures that may be in a dry dock or a floating
shipyard. In other words, Stewart did not consider whether an incomplete
structure that “is not yet an instrumentality of commerce,” Williams, 452 F.2d
at 958, is a vessel in navigation. Rather, Stewart stressed that the “in
navigation” requirement had nothing to do with locomotion and instead meant
that “structures may lose their character as vessels if they have been withdrawn
from the water for extended periods of time.” Stewart, 543 U.S. at 496. But for
a structure to be able to lose its vessel status by being taken out of navigation,
it must be equally true that a structure may not attain vessel status before it is
ever put into “navigation.”
Other courts have similarly concluded that an incomplete structure that
has not been put into navigation as an instrument of commerce is not a vessel.
See Caruso v. Sterling Yacht & Shipbuilders, Inc., 828 F.2d 14, 15–16 (11th Cir.
1987); Frankel v. Bethlehem-Fairfield Shipyard, 132 F.2d 634, 635–36 (4th Cir.
1942). Moreover, courts have historically spoken of navigation in tandem with
commerce. See, e.g., The Robert W. Parsons, 191 U.S. 17, 31 (1903) (holding that
a barge drawn by horses in the Erie Canal was a vessel because “[s]o long as the
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No. 05-30963
vessel is engaged in commerce and navigation it is difficult to see how the
jurisdiction of admiralty is affected by its means of propulsion”); Cope v. Vallette
Dry-Dock Co., 119 U.S. 625, 627–28 (1887) (noting that “[a] ship or vessel, used
for navigation and commerce, though lying at a wharf, and temporarily made
fast thereto, as well as her furniture and cargo, are maritime subjects”); People’s
Ferry Co. of Boston v. Beers, 61 U.S. 393, 401 (1857) (“[T]he admiralty courts now
exercise jurisdiction over rivers and inland waters, wherever navigation is or
may be carried on, and extends to almost every description of vessel which may
be employed in transporting our products to market. . . . The admiralty
jurisdiction, in cases of contract, depends primarily upon the nature of the
contract, and is limited to contracts, claims, and services, purely maritime, and
touching rights and duties appertaining to commerce and navigation.”).
That is not to say that only commercial structures may become vessels and
implicate admiralty jurisdiction. See, e.g., Sisson v. Ruby, 497 U.S. 358, 363–67
(1990) (admiralty jurisdiction in tort requires inter alia that an incident have a
potentially disruptive effect on maritime commerce and be substantially related
to maritime activity, such as navigation, but the tortfeasor’s activity may be
commercial or noncommercial). Rather, our precedent is not inconsistent with
the historical perspective that vessels under construction are treated differently
from completed vessels. See The Francis McDonald, 254 U.S. 242, 243–44 (1920)
(holding in a contract case that shipbuilding has been considered a nonmaritime
activity, whether or not the incomplete ship has been launched). We have
previously noted “the historical tradition that vessels under construction give
rise to neither a maritime contract nor a maritime tort.” Williams, 452 F.2d at958 n.5; see also Alfred v. MV Margaret Lykes, 398 F.2d 684, 685 (5th Cir. 1968)
(holding that an employee may not maintain a tort action against his employer
for an injury sustained on a vessel that has been launched but not fully
completed or commissioned). We do not read Stewart to change this body of law,
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No. 05-30963
so that a structure under construction remains a non-vessel until it is complete
and ready for duty upon the sea.
We further think the preclusion from vessel status of crafts still under
construction serves several important goals and is consistent with the concern
for avoiding uncertainties and possible oscillation in and out of Jones Act status.
See Stewart, 543 U.S. at 495 (asking whether a watercraft is motionless or
moving is the kind of “snapshot” test previously rejected and would
impermissibly allow structures to oscillate back and forth between Jones Act
coverage).
Our cases show that shipbuilders frequently begin the construction process
in a shipyard at one location and then transport the partially completed craft to
another location to finish the construction process. See, e.g., Garret, 799 F.2d at
1008 (barge hull transported by tug from shipyard in Houma, Louisiana, to
Harvey, Louisiana, for completion of superstructure); Fredieu v. Rowan Cos.,
Inc., 738 F.2d 651, 652 (5th Cir. 1984) (ship partially constructed in Vicksburg,
Mississippi, towed to Belle Chasse, Louisiana); Hollister v. Luke Constr. Co., 517
F.2d 920, 921 (5th Cir. 1975) (barge towed from Harvey, Louisiana, to Houma,
Louisiana, to complete drilling rig). Along the way, hundreds of employees work
to complete these partially-built structures. The CAJUN EXPRESS had over
200 men working on its completion. Stewart’s application to these vessels-to-be
could have the consequence of creating vessels out of partial structures and
transforming many land-based ship construction workers into Jones Act seaman,
at least while they work in the service of the ship. At a minimum, it would
unnecessarily expand the labyrinth that has developed in the case law
concerning seaman status by requiring fact-intensive inquiries in the district
courts into the relationship between such workers and the intended vessel. Cf.
Chandris, 515 U.S. at 356 (“We have made a labyrinth and got lost in it.”
(internal quotation marks and citation omitted)). Marine employers (and their
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insurers) and employees, however, have an interest “in being able to predict who
will be covered by the Jones Act . . . before a particular workday begins.” Id. at
363.
That interest is hindered with respect to the construction of watercraft
because there will be many points along the continuum of a ship’s construction
at which one could rationally argue it is “practically capable” of transportation
and therefore a vessel. For example, a structure might become a vessel when it
is merely capable of floatation but is still in dry dock; when it can be merely
towed or pushed; when the navigation or propulsion systems are installed; when
it has been inspected and commissioned; when it has been accepted for delivery;
when a crew has been assigned; or when it is actually put to use. Our prior
cases settle this uncertainty by asking whether the craft is complete. We
continue to believe that “[f]or there to be a seaman, there must first be a ship,”
but “an incompleted vessel not yet delivered by the builder is not such a ship.”
Williams, 452 F.2d at 958.
The difficulty of applying Stewart to vessels under construction may be
seen with respect to the CAJUN EXPRESS. The testimony showed that the rig
lacked vital equipment for its operations and that no drilling contractor would
have found the CAJUN EXPRESS acceptable for duty in the Gulf of Mexico. It
strains reason to say that a craft upon the water that is under construction and
is not fit for service is practically capable of transportation.
Moreover, mobile offshore drilling units like the CAJUN EXPRESS are
subject to extensive Coast Guard regulations. See 46 C.F.R. §§ 107–09. Before
operations begin the unit must receive an Original Certificate of Inspection
certifying that it complies with all Coast Guard requirements, including
regulations governing lifesaving and firefighting equipment. Id. §§ 107.211,
107.231. The record here shows that the Coast Guard performed an initial walk
through of the CAJUN EXPRESS on August 31, 2000, as the first step in the
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process of certification, but the rig was not put into service until April or May
2001. That the structure was not yet certified as operational and in compliance
with all safety requirements casts doubt as to the practicality of its use as a
means of transportation. To follow the district court’s decision here also runs the
risk of concluding that a vessel that may not be legally permitted to operate is
nevertheless practically, rather than theoretically, capable of transportation.1
In short, although Stewart instructs that the “in navigation” requirement
“is relevant to whether the craft is ‘used, or capable of being used’ for maritime
transportation,” 543 U.S. at 496, that instruction does not consider in the first
instance when a vessel-to-be becomes a vessel. We view that issue as a separate
question from whether an unconventional watercraft is a vessel. We therefore
hold that Stewart does not require us to modify our precedent regarding the
vessel status of incomplete watercraft. As such, the CAJUN EXPRESS was not
a “vessel in navigation,” and Cain was not a Jones Act seaman. Cain was thus
not entitled to relief under the Jones Act for his September 10, 2000, injury.2
III. Conclusion
The district court’s denial of Transocean’s motion for summary judgment
is REVERSED and the case is REMANDED to the district court for further
proceedings consistent with this opinion. Costs shall be borne by Cain.
1
We do not hold that a watercraft that has not been certified by the Coast Guard can
never be considered a vessel. See Holmes, 437 F.3d at 443–44 (holding that a barge containing
a floating dormitory that had not been inspected by or registered with the Coast Guard was
a vessel). We note only that the absence of certification when legally required should inform
the evaluation of a structure’s capability for transportation.
2
We note that in the district court Cain argued that even if the CAJUN EXPRESS was
not a vessel he was a Jones Act seaman based on his overall employment because he was a
seaman before joining the CAJUN EXPRESS and his essential duties never changed. The
district court did not reach this issue because it concluded that the CAJUN EXPRESS was a
vessel. The parties have not briefed the issue to us, and we express no opinion on its merit.
We merely note its existence and point out that it remains unresolved in the district court.
Further, Cain’s claims with respect to his alleged injuries at the Fontana Center are
unresolved.
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PRISCILLA R. OWEN, CIRCUIT JUDGE, DISSENTING:
This is a very difficult case, in my view. The panel’s opinion sets forth
cogent arguments as to why there should be a bright-line rule as to when a
vessel under construction becomes a “vessel in navigation” for purposes of
determining whether an injured worker was a “seaman” within the meaning of
the Jones Act. However, the language used by the United States Supreme Court
in Stewart v. Dutra Construction Company3 is broad and seems to require us to
conclude that the CAJUN EXPRESS is a contrivance that is capable of being
used as a means of transportation on water since the CAJUN EXPRESS did in
fact transport Cain and others across an ocean.
There are undoubtedly conceptual difficulties in applying the principle
that a “contrivance” becomes a vessel in navigation when it is a “watercraft
practically capable of maritime transportation, regardless of its primary purpose
or state of transit at a particular moment.”4 At some point prior to its actual
commissioning, a “contrivance” under construction may become capable of
maritime transportation in a physical and practical sense whether moored in the
water or in dry dock. The uncertainties as to the hour or day the practical
capability of maritime transportation occurs would seem a fertile source of
contract and tort litigation and may lead to overlapping insurance
arrangements, and unnecessary costs in obtaining that coverage. Additionally,
a contrivance under construction may be moored for long periods of time while
further construction continues after an initial voyage transported crew members
on the seas, as was the case here.
In spite of the certainty and predictability that the panel’s decision would
bring in many if not most scenarios involving vessels under construction, the
3
543 U.S. 481 (2005).
4
Id. at 497.
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CAJUN EXPRESS appears to have all the attributes that the Supreme Court
ascribed to a “vessel” in Stewart. I therefore, very respectfully, dissent.
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