Terrebonne v. K-Sea Oprt Prtnshp ( 2007 )

United States Court of Appeals
Fifth Circuit
F I L E D
REVISED FEBRUARY 15, 2007
January 26, 2007
IN THE UNITED STATES COURT OF APPEALS
Charles R. Fulbruge III
FOR THE FIFTH CIRCUIT Clerk
No. 06-30041
DEXTEL TERREBONNE,
Plaintiff-Appellant,
versus
K-SEA TRANSPORTATION CORP.,
Defendant-Appellee.
Appeal from the United States District Court
for the Eastern District of Louisiana
Before GARWOOD, DENNIS, and OWEN, Circuit Judges.
GARWOOD, Circuit Judge:
Plaintiff–appellant Dextel Terrebonne (Terrebonne) appeals the
district court’s September 13, 2002, November 5, 2002, and December
15, 2005 orders granting the motion of defendant–appellee K-Sea
Transportation Corporation (K-Sea) to compel arbitration, denying
Terrebonne’s motion for rehearing of that order, and granting K-
Sea’s motion to confirm the June 27, 2005 arbitration award and
denying Terrebonne’s motion to set aside the September 2002 order
to compel. For the following reasons, we affirm.
FACTS AND PROCEEDINGS BELOW
In November 2000, Terrebonne worked for K-Sea as a crew member
aboard its tug MARYLAND. On November 3, while the tug was in
Bridgeport, Connecticut, Terrebonne overexerted himself when
lifting a pump in the tug’s port propeller shaft alleyway.
Terrebonne reported the incident on November 28, 2000, complaining
of abdominal pain. He was diagnosed with a left inguinal hernia,
and underwent hernia repair surgery on December 11, 2000, returning
to work on January 26, 2001.
On March 12, 2001, Terrebonne and K-Sea executed in New York
a written “Partial Release and Claims Arbitration Agreement.”
Pursuant to that agreement, the parties partially settled
Terrebonne’s claims arising out of the November 3, 2000 incident
for $2,362.56. Specifically, the agreement settled “all rights,
claims, liens, remedies or causes of action for any damages that he
[Terrebonne] has incurred from 11/03/00 to March 12, 2001.”
Terrebonne reserved the right to seek recovery for “damages that
may develop after the date of this agreement that are related to
the alleged incident on the Tug MARYLAND on or about 11/3/02,” but
agreed to arbitrate any such future claims in New York:
“In further consideration of this partial settlement,
Dextel Terrebonne agrees to submit any claims related to
the alleged incident on the Tug MARYLAND on 11/3/00, for
damages that develop after the date of this agreement,
arising under the theory of unseaworthiness, Jones Act,
or any other applicable law to arbitration in New York
2
pursuant to the Commercial Arbitration Rules of the
American Arbitration Association (AAA). . . . The
decision of the arbitrators shall be final and binding on
the parties and any United States District Court shall
have the jurisdiction to enforce this agreement, to enter
judgement on the award and to grant any remedy provided
by law in respect of the arbitration proceedings.”
According to K-Sea’s uncontradicted affidavits, Terrebonne
“reported a recurrence of his prior hernia” on April 26 or 27, 2001
while working on the tug. Terrebonne continued to work until May
25, 2001 “when he complained that his prior hernia had developed
again.” After May 2001, he underwent medical treatment for the
reinjury.
On May 1, 2002, Terrebonne instituted this suit against K-Sea
in the court below. His complaint “demands trial by jury,” alleges
that it is filed “under the Jones Act (46 U.S.C. [§] 688) for
negligence, and under the General Admiralty and Maritime Law for
unseaworthiness, maintenance, care and wages.” It further asserts
that plaintiff was “an employee of Defendant serving as a crew
member aboard its vessels,” and that:
“On or about November 3, 2000 Plaintiff was in the course
of employment when he was required to engage in awkward
positioning and the lifting of heavy weights excessive
for a single person when as a result of said unseaworthy
condition and failure to provide a safe place to work he
was injured and suffered re-injury on or about April 27,
2001 when he was required to move air plane tires in
awkward positions resulting in excessive lifting and
overexertion because of said failure to provide a safe
place to work and unseaworthy condition.”
The complaint next alleges that “Defendant’s tortious acts
3
aforesaid caused or contributed to Plaintiff’s damages.”1 The
complaint makes no reference to the March 12, 2001 settlement
agreement or the payment pursuant thereto. No amended complaint
has been filed or sought to be filed.
K-Sea moved to “stay further proceedings in this matter
pending completion of the arbitration” of Terrebonne’s claims
pursuant to the March 12, 2001 agreement. Terrebonne opposed the
motion, arguing that his April 2001 injury was a separate injury
from his prior hernia; that the arbitration agreement was
unenforceable under section one of the Federal Arbitration Act
(FAA), 9 U.S.C. § 1, because it involves a seaman’s employment
contract; that the Jones Act, 46 U.S.C. § 688, by virtue of its
incorporation of section five of the Federal Employers’ Liability
Act (FELA), 45 U.S.C. § 55, voided the agreement; and that the
agreement is also void under 46 U.S.C. § 183c(a).2
Over Terrebonne’s objections, the district court granted K-
Sea’s motion to compel on September 13, 2002 (the order was entered
1
Plaintiff’s damages are alleged to include: “a. Pain and
suffering, past, future; b. Mortification, humiliation, fright
shock and embarrassment; c. Loss of earnings and earning
capacity; d. Hospital, pharmaceutical and other cure expenses;
e. Aggravation of prior condition, if any there be; f.
Inability to engage in social, recreational, and other pursuits
previously enjoyed; g. mental anguish; h. Found; i.
Maintenance, cure, and wages.”
2
On appeal, Terrebonne does not argue that the agreement is
void under 46 U.S.C. § 183c(a), which by its terms applies only
to passenger vessels.
4
on September 16, 2002).3 The court concluded that Terrebonne’s
second hernia was a recurrence of the first hernia; that the March
12, 2001 agreement is “clearly separate and independent from
Terrebonne’s employment contract”; that Terrebonne’s FELA-based
argument was unsupported by case law and further undermined by the
fact that the agreement does not exempt K-Sea from liability; and
that 46 U.S.C. § 183c(a) is inapplicable as it only deals with
passenger vessels. On October 11, 2002, Terrebonne filed a “Motion
for Rehearing” which the district court denied on November 5, 2002,
treating the motion as one under Rule 60(b) and concluding that
Terrebonne had not provided any “clarification of issues or new
evidence” warranting reconsideration.
Thereafter, Terrebonne, on March 26, 2003, filed suit in
Louisiana state court against K-Sea respecting the same matter. K-
Sea responded by moving the district court to enjoin prosecution of
the state court suit and to require Terrebonne to abide by the
court’s orders compelling arbitration. Before the district court
ruled, however, Terrebonne agreed to a consent order which the
district court approved, signed and entered May 13, 2003. That
order recites that Terrebonne and his counsel “agree to dismiss the
Louisiana state court action,” “agree to abide by this court’s
3
The order concludes by reciting that “the defendant’s
motion to compel arbitration and stay litigation is GRANTED” and
“this case is closed for statistical purposes;” the order does
not direct, and K-Sea’s motion did not request, that the suit be
dismissed.
5
Order dated September 13, 2002, compelling arbitration of this
dispute” and “agree to proceed forthwith with the arbitration
before the American Arbitration Association.” The consent order
also “dismisses, as moot” K-Sea’s request for injunction.
Arbitration began in New York in June 2003. Terrebonne and K-
Sea made various submissions and attended a two-day evidentiary
hearing in October 2004, where there were over 200 exhibits and 450
pages of testimony. Following post-hearing submissions, the
hearings were declared closed on April 29, 2005, with a deadline of
June 28, 2005, for the panel to render its award. The New York
Arbitration Panel issued its award on June 27, 2005, denying all of
Terrebonne’s claims, but awarding him arbitration costs in the
amount of $9,132 to be paid by K-Sea.4
On August 5, 2005, K-Sea moved to reopen this suit, and to
enter judgment confirming the arbitration award and dismissing the
lawsuit with prejudice (and to deposit the $9,132 awarded
Terrebonne with the court), per 9 U.S.C. § 9.5 Terrebonne on
4
K-Sea then attempted to pay Terrebonne the $9,132, but his
attorney informed K-Sea by a July 8, 2005 letter that Terrebonne
would not accept the $9,132 as such would be inconsistent with
the intention “to contest the viability of enforcement of the
arbitration award.”
5
9 U.S.C. § 9, “Award of arbitrators; confirmation;
jurisdiction; procedure,” states, in pertinent part:
“If the parties in their agreement have agreed that a
judgment of the court shall be entered upon the award
made pursuant to the arbitration, and shall specify the
court, then at any time within one year after the award
is made any party to the arbitration may apply to the
court so specified for an order confirming the award,
6
August 12, 2005 filed an opposition to K-Sea’s motion6 and also
moved to set aside the district court’s September 2002 order. He
argued that enforcing the arbitration award would violate public
policy and that the agreement violated section five of the FELA.
On December 15, 2005, the district court granted K-Sea’s motion and
denied Terrebonne’s request to set aside the September 2002 order
because the request “assert[ed] the same arguments that th[e] Court
ha[d] taken to be borderline frivolous twice before.” This last
order further provides that “plaintiff’s claims against the
defendant are hereby dismissed, with prejudice.”
Terrebonne timely appealed.
DISCUSSION
The gist of Terrebonne’s arguments on appeal is that the March
2001 arbitration agreement is unenforceable. He secondarily
asserts that, if the agreement is enforceable, his “re-injury”
falls outside the agreement’s scope. Terrebonne does not contend
that the arbitration panel erred. Rather, he attacks the district
court’s orders compelling arbitration and confirming the
arbitration award; in effect, he argues that his claims should not
and thereupon the court must grant such an order unless
the award is vacated, modified, or corrected . . . .”
6
Terrebonne opposed K-Sea’s motion to confirm the
arbitration award and moved to set aside the September 2002 order
under FRCP 60(b). The district court considered Terrebonne’s
motion under Rule 60(b)(4) through (6) because these were “the
only bases for 60(b) relief when sought more than one year after
the challenged order was entered.”
7
have been subjected to arbitration in the first place. We
disagree, and affirm the district court’s orders, finding the
arbitration agreement both enforceable and broad enough for the
district court to compel arbitration and allow the arbitrators to
determine the agreement’s scope.
I. Jurisdiction and Standards of Review
This court has jurisdiction over the instant appeal by virtue
of 28 U.S.C. § 12917 and 9 U.S.C. § 16.8 The parties both assume
7
28 U.S.C. § 1291 states that “[t]he courts of appeals
(other than the United States Court of Appeals for the Federal
Circuit) shall have jurisdiction of appeals from all final
decisions of the district courts of the United States . . . .”
8
Section 16 of the FAA, “Appeals,” states:
“(a) An appeal may be taken from—
(1) an order—
(A) refusing a stay of any action under section 3 of
this title,
(B) denying a petition under section 4 of this title to
order arbitration to proceed,
(C) denying an application under section 206 of this
title to compel arbitration,
(D) confirming or denying confirmation of an award or
partial award, or
(E) modifying, correcting, or vacating an award;
(2) an interlocutory order granting, continuing, or
modifying an injunction against an arbitration that is
subject to this title; or
(3) a final decision with respect to an arbitration that is
subject to this title.
(b) Except as otherwise provided in section 1292(b) of title 28,
an appeal may not be taken from an interlocutory order—
(1) granting a stay of any action under section 3 of this
title;
(2) directing arbitration to proceed under section 4 of this
title;
(3) compelling arbitration under section 206 of this title;
or
(4) refusing to enjoin an arbitration that is subject to
this title. 9 U.S.C. § 16 (2000).
8
that the fact that this appeal is from the district court’s
December 15, 2005 order confirming the award and dismissing
Terrebonne’s suit with prejudice – rather than from the September
2002 order compelling arbitration, staying the action and stating
“this case is closed for statistical purposes” – does not of itself
preclude Terrebonne from challenging the validity of the September
2002 order.9 We accordingly proceed on that assumption.
9
Any such preclusion would not of itself be truly
jurisdictional, but would be more in the nature of law of the
case, estoppel or res judicata. We do note that where we
dismissed for want of jurisdiction an attempted appeal from an
order staying litigation pending arbitration because the order
was non-final, we stated that it “was not the case” that the
appellant then
“. . . will be left with virtually no remedy, because
of the deference afforded an arbitrator’s award, if the
district court has mistakenly forced it to arbitrate
the issue of arbitrability. If the district court
confirms the arbitration award, this court will then
have jurisdiction to conduct a ‘typical’ review of the
district court’s decision regarding the scope of the
agreement to arbitrate.” F.C. Schaffer & Associates
Inc. v. Demech Contractors Ltd., 101 F.3d 40, 43 (5th
Cir. 1996).
See also Jolley v. Paine Webber Jackson & Curtis Inc., 864 F.2d
402, 404 (5th Cir. 1989). It may well be that the foregoing
passage from Schaffer is inapplicable where the challenged order
to arbitrate was final and appealable. We also note, however,
that the September 2002 order here appears to be interlocutory
and not final and hence to be non-appealable under 9 U.S.C. §
16(b). Mire v. Full Spectrum Lending Inc., 389 F.3d 163 (5th
Cir. 2004). We note in this respect that the fact that the case
was not dismissed, that a “stay” was granted and that the closing
was stated to be “for statistical purposes” (see note 3 supra)
all suggest non-finality. See South Louisiana Cement v. Van
Aallst Bulk Handling, 383 F.3d 297, 301-02 (5th Cir. 2004). In
American Heritage Life Ins. Co. v. Orr, 294 F.3d 702, 706-07 (5th
Cir. 2002), the order held appealable, though it did not
expressly dismiss the case, did not purport to stay proceedings
in the court issuing the order (it stayed proceedings only in
9
We review de novo the district court’s ruling on K-Sea’s
motion to compel arbitration and stay litigation. Freudensprung v.
Offshore Technical Services, Inc., 379 F.3d 327, 337 (5th Cir.
2004). The district court’s denial of Terrebonne’s motion for
rehearing—treated as a Rule 60(b) motion—is reviewed for an abuse
of discretion. Warfield v. Byron, 436 F.3d 551, 555 (5th Cir.
2006). Confirmation of the arbitrator’s award is reviewed de novo.
Executone Info. Sys., Inc. v. Davis, 26 F.3d 1314, 1320 (5th Cir.
1994).
II. Terrebonne’s Arguments and Applicable Law
A. Enforceability of the Arbitration Agreement
Terrebonne focuses his appeal almost entirely on the district
court’s September 2002 order to arbitrate and the validity or
enforceability of the March 2001 arbitration agreement.
Specifically, he makes two challenges against the agreement:
First, he asserts that the arbitration agreement is subsumed into
his employment contract and therefore unenforceable per section one
of the FAA, 9 U.S.C. § 1, which excludes “contracts of employment
of seamen” from the FAA’s purview. Second, Terrebonne contends
that the agreement is void under section five of the FELA, which is
state court) and its statement that the case “is closed” was
wholly unmodified by any language (such as “for statistical
purposes” or “administratively”) which might indicate the closure
was not final and complete for all purposes.
10
applicable here by virtue of the Jones Act, 48 U.S.C. § 688.10
Section Five of the FELA provides in relevant part that “[a]ny
contract, rule, regulation, or device whatsoever, the purpose or
intent of which shall be to enable any common carrier to exempt
itself from any liability created by this chapter, shall to that
extent be void.” 45 U.S.C. § 55. We consider each argument in
turn below.
1. Section One of the FAA
The FAA “compels judicial enforcement of a wide range of
written arbitration agreements.” Circuit City Stores, Inc. v.
Adams, 121 S. Ct. 1302, 1307 (2001). Accordingly, the FAA
“generally declares valid and enforceable written provisions for
arbitration in any maritime transaction . . . .” Freudensprung,
379 F.3d at 339. This is consistent with the FAA’s purpose, which
10
46 U.S.C. § 688, the Jones Act, provides in relevant part:
“Any seaman who shall suffer personal injury in the
course of his employment may, at his election, maintain
an action for damages at law, with the right of trial
by jury, and in such action all statutes of the United
States modifying or extending the common-law right or
remedy in cases of personal injury to railway employees
shall apply; and in case of death of any seaman as a
result of any such personal injury the personal
representative of such seaman may maintain an action
for damages at law with the right of trial by jury, and
in such action all statutes of the United States
conferring or regulating the right of action for death
in the case of railway employees shall be applicable.
Jurisdiction in such actions shall be under the court
of the district in which the defendant employer resides
or in which his principal office is located.” 46
U.S.C. § 688(a).
11
“was to reverse the longstanding judicial hostility to arbitration
agreements.” Gilmer v. Interstate/Johnson Lane Corp., 111 S. Ct.
1647, 1651 (1991).
Section one of the FAA, however, provides that “nothing herein
contained shall apply to contracts of employment of seamen,
railroad employees, or any other class of workers engaged in
foreign or interstate commerce.” 9 U.S.C. § 1. Terrebonne argues
that this exclusion applies in the instant case because the March
2001 agreement is subsumed into his employment contract. We find
this argument unpersuasive.
First, we note that the agreement here only partially settles
claims for benefits and damages related to Terrebonne’s November
2000 injury. It does not purport either to employ Terrebonne or to
modify Terrebonne’s contract of employment in any way. Thus, on
its face, the agreement does not appear to fall within section
one’s exception for “contracts of employment of seamen.”
Terrebonne, however, argues that the March 2001 agreement is
subsumed into his employment contract because the agreement covers
his maintenance and cure claims. Because maintenance and cure are
inseparable from a seaman’s employment, he contends, the agreement
necessarily constitutes part of his employment contract, such that
the agreement falls within section one’s exception.11
11
K-Sea argues that Terrebonne did not raise this issue
below. Terrebonne replies that his Memorandum in Opposition to
Motion to Compel Arbitration and Stay Litigation Pending
12
The March 2001 agreement indeed covered Terrebonne’s
maintenance and cure claims up to the time that the agreement was
entered into. We reject, however, Terrebonne’s assertion that
these maintenance and cure claims necessarily implicate his
employment contract. Certainly, there is case law using
generalized language connecting maintenance and cure to the
seaman’s employment contract. See, e.g., Aguilar v. Standard Oil
Co. of N.J., 63 S. Ct. 930, 933–34 (1943) (“In the United States
[maintenance and cure] has been recognized consistently as an
implied provision in contracts of marine employment.”); Tate v. Am.
Tugs, Inc., 634 F.2d 869, 870 (5th Cir. 1981) (“The right of an
injured seaman to maintenance is a form of compensation that arises
out of the contract of employment.”). Yet, we have clarified that
maintenance and cure is an intrinsic part of the employment
relationship, separate from the actual employment contract:
Arbitration, filed on September 3, 2002, raised the argument.
Specifically, Terrebonne points to his statement in the
memorandum that, “Just at [sic] the right to maintenance and cure
is implied in a seaman’s employment contract Aguilar v Standard
Oil Co. of N.J., 318 U.S. 724, 730 (1943), an arbitration
agreement for a seaman’s unaccrued personal injury claim is
subsumed within the employment contract.” Given that this
appears to be the sole indication that Terrebonne raised his
maintenance and cure argument below, it is doubtful that the
argument was briefed adequately for the district court to
consider it. Compare Goetz v. Synthesys Tech.s, Inc., 415 F.3d
481, 485 n.13 (5th Cir. 2005) (stating that, even where an issue
was “raised in a muddled fashion, the fact that the district
court was able to rule on the issue is sufficient for us to
consider it raised, even in a refined form on appeal”). In any
event, the argument lacks merit for the reasons stated below.
13
“[M]aintenance and cure differs from contractual rights.
The Court, in Cortes v. Baltimore Insular Line, 287 U.S.
367, 371, 53 S. Ct. 173, 77 L. Ed. 368 (1932), held that
maintenance and cure ‘is imposed by the law itself as one
annex to the employment. . . . Contractual it is [in
the] sense that it has its source in a relation which is
contractual in origin, but given the relation, no
agreement is competent to abrogate the incident.’” Wood
v. Diamond M Drilling Co., 691 F.2d 1165, 1170 (5th Cir.
1982) (concluding that “recovery of maintenance and cure
is not subject to the same mitigation limitations that
govern recovery based on ordinary contractual rights”).12
In other words, maintenance and cure is an essential part of the
seaman’s employment relationship that cannot be contracted away:
“The duty to provide maintenance attaches once the seaman enters
the service of the ship and it is ‘a duty that no private agreement
is competent to abrogate.’” Baldassaro v. United States, 64 F.3d
206, 212 (5th Cir. 1995) (quoting De Zon v. Am. President Lines, 63
S. Ct. 814, 818 (1943)). It is true that collective bargaining
agreements may validly set the rate of maintenance and cure. See
id. at 212 (“The right to maintenance cannot be abrogated, but it
can be modified and defined by contract.”). But we do not accept
that this in turn means that maintenance and cure is part of the
employment contract. Further, while the March 2001 agreement
states that K-Sea is obligated to pay maintenance and cure, it does
12
Since this court’s decision in Wood, the Supreme Court has
noted that the rule under Cortes, that “[u]nder traditional
maritime law . . . there is no right of survival; a seaman’s
personal cause of action does not survive the seaman’s death,”
has been changed “in many instances” by Congress and the States.
Miles v. Apex Marine Corp., 111 S. Ct. 317, 326 (1990). This does
not affect the strength of our decision in Wood as it discusses
maintenance and cure.
14
not purport to change anything regarding that obligation or
regarding Terrebonne’s employment with K-Sea. Thus, we conclude
the agreement is not subsumed into Terrebonne’s employment
contract, and does not fall under section one’s exception to the
FAA’s coverage.13
2. Section Five of the FELA
We also reject Terrebonne’s assertion that because this is a
Jones Act case, the arbitration agreement is invalid for the reason
that it violates section five of the FELA. “In passing the Jones
13
See also, e.g., Williams v. Cigna Financial Advisors Inc.,
56 F.3d 656 (5th Cir. 1995), an employee’s discrimination suit
against his employer, Cigna, in which we rejected the contention
that the arbitration agreement was excluded from the FAA as
falling within the exemption for “contracts of employment of . .
. workers engaged in . . . interstate commerce” under 9 U.S.C. §
1. As our opinion came well before Circuit City Stores, Inc. v.
Adams, 121 S. Ct. 1302 (2001), we based our decision in that
respect (as the Supreme Court had a few years previously in
Gilmer v. Interstate/Johnson Lane Corp., 111 S. Ct. 1647 (1991))
solely on the ground that the arbitration agreement was not a
contract of employment for purposes of § 1 and did not address
whether the “workers engaged in . . . interstate commerce” aspect
of the above quoted § 1 exclusion was satisfied. The plaintiff’s
employment contract with Cigna, a member of the National
Association of Securities Dealers (NASD), was known as a
“Registered Representative Agreement” and the arbitration
agreement (requiring arbitration of employment related disputes
with the registrant’s employer) was contained in a “U-4
Registration,” an agreement required to be executed with NASD as
a part of registering with it, which was required of the
plaintiff by his Registered Representative Agreement. We held:
“. . . if we were to hold that Williams’ Registered
Representative Agreement incorporated by reference the U-4
Registration arbitration clause, § 1 would still exempt only the
contract of employment. The U-4 Registration is a separate
contract, and its arbitration clause is enforceable under the
FAA.” Id., 56 F.3d at 660.
15
Act, Congress did not specifically enumerate the rights of seamen,
but extended to them the same rights granted to railway employees
by FELA.” Withhart v. Otto Candies, L.L.C., 431 F.3d 840, 843 (5th
Cir. 2005). Section five of the FELA invalidates “[a]ny contract,
rule, regulation, or device whatsoever, the purpose or intent of
which shall be to enable any common carrier to exempt itself from
any liability created by this chapter . . . .” 45 U.S.C. § 55
(2000).
For his FELA-based argument, Terrebonne relies heavily on Boyd
v. Grand Trunk W. R.R. Co., 70 S. Ct. 26 (1949) (per curiam). In
Boyd the railroad employee, having been injured on the job, agreed,
in exchange for his employer’s cash advances against whatever
settlement or recovery was later achieved, that any suit to be
filed on account of the injury would be filed only in a district
(or county) that was either his residence when injured or in which
the injury occurred. Both such locations were in Michigan, but the
employee filed suit in the Supreme Court of Cook County, Illinois.
The railroad sued the employee in Michigan state court to enjoin
his prosecution of the Illinois suit, and the Michigan Supreme
Court ruled for the railroad. The United States Supreme Court
reversed, holding that the Illinois suit was in a venue
specifically authorized under section 6 of the FELA14 and that hence
14
FELA’s section six, “Actions; limitations; concurrent
jurisdiction of courts,” 45 U.S.C. § 56, provides, in relevant
part:
16
FELA section 5 voided the agreement excluding that venue provided
for in section 6.
For several reasons, we are not persuaded that Boyd controls
here.
To begin with, the venue provisions of section 6 of the FELA
– which Boyd held protected by FELA section 5 – do not apply to the
Jones Act, which has its own venue provision contained in the last
sentence of section 688(a) (see note 10, supra), and provides for
venue in a district where “the defendant employer resides” or “his
principal office is located.”15 Venue of a Jones Act case is hence
not provided for in section 6, or in any other provision, of the
FELA. We directly so held in Pure Oil Co. v. Suarez, 346 F.2d 890,
892 (5th Cir. 1965), affirmed on other grounds, 86 S. Ct. 1394
(1966). There, the plaintiff seaman brought a Jones Act and
general maritime law suit against his employer, Pure Oil Company,
“Under this chapter an action may be brought in a
district court of the United States, in the district of
the residence of the defendant, or in which the cause
of action arose, or in which the defendant shall be
doing business at the time of commencing such action.”
15
Although this sentence of § 688(a) is written in terms of
“jurisdiction,” it has been construed to refer only to venue.
Panama R. Co. v. Johnson, 44 S. Ct. 391, 393 (1924).
28 U.S.C. § 1391(c) provides in part that “[f]or purposes of
venue under this chapter, a defendant that is a corporation shall
be deemed to reside in any judicial district in which it is
subject to personal jurisdiction at the time the action is
commenced.” That section, as it was enacted in 1948, was held
applicable to the Jones Act in Pure Oil Company v. Suarez, 86
S. Ct. 1391 (1966).
17
in the Southern District of Florida. The defendant moved to
transfer the case to the Northern District of Illinois, it being
undisputed that it was incorporated in Ohio and had its principal
office in Illinois, although it did do substantial business in the
Southern District of Florida when the suit was commenced. The
district court denied the motion to transfer, but certified its
ruling to this court under 28 U.S.C. § 1292(b). We noted that
“[t]he relevant language of the Jones Act, 46 U.S.C. § 688"
provides for venue in the district “in which the defendant employer
resides” or has its principal office, and that “in the absence of
a statutory directive to the contrary, the ‘residence’ of a
corporation for venue purposes is limited to the state of its
incorporation.” Id. at 891-92. We stated that “appellee [seaman]
makes two arguments in support of the district court’s denial of
the motion to transfer,” describing the first of these as follows:
“. . . appellee argues that the special venue provisions of the
Federal Employers Liability Act, under which venue against Pure Oil
would undoubtedly be proper in the instant case, are applicable to
a civil action under the Jones Act.” Id. at 892 (footnote
omitted).16 Characterizing this argument as one “which can be
disposed of in short order,” we emphatically rejected it, stating:
16
Citing FELA § 6, we noted that “[t]he FELA contains much
broader venue provisions than those of the Jones Act” and
provides that venue is proper in, among other districts, any
“where the defendant is ‘doing business’ at the time of the
commencement of the action.” Id., 892 n.3.
18
“However, this argument does not adequately accommodate
the well-recognized and eminently logical canon of
statutory construction that the specific provisions of a
statute control exclusively over the broader and more
general provisions of another statute which may relate to
the same subject matter in the absence of a clear
manifestation to the contrary by the legislature. . . .
[citations omitted]. As one court has stated, ‘The short
answer to [appellee’s] argument is that Congress has seen
fit to impose different venue requirements in Jones Act
cases. To now hold that the venue requirements under the
Federal Employers’ Liability Act are controlling would
negate the plain language of 46 U.S.C. § 688.’ Rodriguez
v. United Fruit Co., 236 F. Supp. 680, 682 (E.D. Va.
1964).” Id.
Having rejected the seaman-appellee’s first argument, we
proceeded to consider his second, characterized as “a far more
appealing argument,” which was that “the definition of the term
‘residence’ which was added to the general venue statute in 1948,
28 U.S.C.A. § 1391(c), should be read into the Jones Act.” Id. at
893.17 Under the terms of section 1391(c), as added in 1948, “any
judicial district in which” a corporation “is incorporated or
licensed to do business or is doing business . . . shall be
regarded as the residence of such corporation for venue purposes.”
Agreeing with appellee’s second argument, we held that this
17
We observed that: “Prior to 1948 – and, indeed, at the time
Congress enacted the Jones Act in 1920 – . . . The residence of a
corporation [for venue purposes] was uniformly restricted to the
state of its incorporation, even in Jones Act suits. E.g.,
Burris v. Matson Nav. Co., (S.D.N.Y. 1940), 37 F. Supp. 648.”
Id. In the cited Burris case, Jones Act venue was held improper
even though the defendant was, at the time of suit, doing
business in the district.
19
definition of a corporate defendant’s residence in section 1391(c)
applied to determine the district “in which the” corporate
“defendant employer resides” as provided in section 688, and on
that basis affirmed the district court’s denial of the motion to
transfer. Id. at 893-97. In this latter connection we considered
and rejected the contention that the Supreme Court’s decision in
Fourco Glass Co. v. Transmirra Prods. Corp., 77 S. Ct. 787 (1957)
(holding section 1391(c) did not define a corporate defendant’s
residence under 28 U.S.C. § 1400(b) applicable to patent
infringement suits) dictated a contrary result. Id. at 894 et seq.
The Supreme Court granted certiorari to resolve the issue
concerning section 1391(c), section 688 and the Fourco case, and
ultimately affirmed this court, holding that the section 1391(c)
definition of corporate residence applied to determine the district
“in which” the corporate “defendant employer resides” as provided
in § 688. Pure Oil Co. v. Suarez, 88 S. Ct. 1394 (1966). The
Supreme Court did not mention our holding that the venue provisions
of section 6 of the FELA did not apply to the Jones Act.18 We note,
however, that the section 1391(c) question would not have any
practical importance if Jones Act venue included whatever venue
18
Nor did the Supreme Court pass on our separate holding (346
F.2d at 891, n.1) that where a suit is based on both the Jones
Act and unseaworthiness the venue requirements of the Jones Act
must be satisfied, the Supreme Court stating there was “no
occasion to pass upon this issue” as it “was not raised in this
Court.” 86 S. Ct. at 1395 n.2.
20
would be proper under section 6 of the FELA because section 1391(c)
embraced no venue not authorized by section 6.
Because, under our decision in Pure Oil Co., the venue
provisions of section 6 of the FELA are inapplicable to Jones Act
cases, it necessarily follows that nothing in section 5 of the FELA
is applicable to Jones Act venue. Hence, neither Boyd nor section
5 dictate the result here.19
Boyd is also to be distinguished because it did not in any way
involve the FAA (or, indeed, an agreement to arbitrate). There was
no federal statute authorizing or providing for the enforcement of
the type of agreement involved in Boyd. In Gilmer v.
Interstate/Johnson Lane Corp., 111 S. Ct. 1647 (1991), the Court
upheld an agreement to arbitrate governed by the FAA, specifically
distinguishing prior cases on the ground, inter alia, that “those
cases were not decided under the FAA, which, as discussed above,
reflects a ‘liberal federal policy favoring arbitration
19
Moreover, in Boyd the Court specifically distinguished its
decision in Ex parte Collect, 69 .Ct. 944 (1949), where the Court
upheld the 28 U.S.C. § 1404(a) transfer to a different district
in a different state, at the defendant railroad’s request and
over the plaintiff-employee’s objection, of the employee’s FELA
suit filed in a section 6 authorized district prior to the
enactment of § 1404(a). Collect observes that § 1404(a) “does
not limit or otherwise modify any right granted in [FELA] § 6 . .
. to bring suit in a particular district . . . [a]n action may
still be brought in any court . . . in which it might have been
brought previously.” Id. at 947. Boyd, which quotes this
passage from Collect, explains that “nothing in Ex parte Collect
. . . affects the initial choice of venue afforded Liability Act
plaintiffs.” Boyd, 70 S. Ct. at 28 (emphasis added).
21
agreements.’” Id. at 1657 (quoting Mitsubishi Motors Corp. v. Soler
Chrysler-Plymouth Inc., 105 S. Ct. 3346, 3353 (1985)). See also,
e.g., Shearson/American Express Inc. v. McMahon, 107 S. Ct. 2332,
2337 (1987) (“The Arbitration Act thus establishes a federal policy
favoring arbitration”) (inside quotation marks and citation
omitted). Here, in contrast to Boyd, the FAA is involved and thus
the issues “must be addressed with a healthy regard for the federal
policy favoring arbitration.” Gilmer at 1652 (emphasis added;
inside quotation marks and citation omitted).20
Terrebonne answers this argument solely by relying on Wilko v.
Swan, 74 S. Ct. 182 (1953). Wilko was a suit by a customer against
a brokerage firm alleging the firm sold him certain securities by
misrepresentations. The suit was pursuant to sections 12(2) and
22(a) of the Securities Act of 1933, 15 U.S.C. § 77l(2), 77v(a),
which respectively provide that under certain circumstances the
seller making such misrepresentation “shall be liable to the person
purchasing such security from him, who may sue . . . in any court
of competent jurisdiction, to recover the consideration paid . .
.”, and that the United States District Courts have jurisdiction
20
Boutte v. Cenac Towing Inc., 346 F. Supp. 2d 922 (S.D. Tx.
2004), relied on by appellant, is similarly distinguishable
because the agreement there held invalid was not an arbitration
agreement and even if it had been it would have been expressly
exempted from the FAA by the terms of 9 U.S.C. § 1 as it was
contained in the seaman’s employment agreement. Boutte at 932
(“choice of forum agreements in employment contracts between
American seaman and American companies are unenforceable in Jones
Act claims”).
22
over such suits, with venue in a district where, inter alia, the
defendant is “found” or “transacts business” or where “the sale
took place” but precluding removal of state court suits. The
defendant moved under section 3 of the FAA to stay trial of the
suit pending completion of arbitration, relying on the arbitration
provisions of the plaintiff’s margin agreement with the brokerage
firm (executed prior to the challenged sale). The Supreme Court
noted that section 14 of the Securities Act, 15 U.S.C. § 77(a),
provided that “[a]ny condition, stipulation, or provision binding
any person acquiring any security to waive compliance with any
provision of this subchapter . . . shall be void.” Id. at 184 n.6.
It went on to hold that the arbitration agreement was invalid
because
“The words of § 14, . . . void any ‘stipulation’ waiving
compliance with any ‘provision’ of the Securities Act.
This arrangement to arbitrate is a ‘stipulation,’ and we
think the right to select the judicial forum is the kind
of ‘provision’ that cannot be waived under § 14 of the
Securities Act.”
Id. at 186, and that “Congress must have intended § 14 . . . to
apply to waiver of judicial trial and review.” Id. at 188.
The Wilko Court then continued by stating:
“This accords with Boyd v. Grand Trunk Western R. Co., .
. . . We there held invalid a stipulation restricting an
employee’s choice of venue in an action under the Federal
Employers’ Liability Act, 45 U.S.C.A. § 51 et seq.
Section 6 of that Act permitted suit in any one of
several localities and § 5 forbade a common carrier’s
exempting itself from any liability under the Act.
Section 5 had been adopted to avoid contracts waiving
employers’ liability. . . . We said the right to select
23
the ‘forum’ . . . is a ‘substantial right’ and that the
agreement, restricting that choice, would thwart the
express purpose of the statute.” Id. (footnotes
omitted).
However, over a decade ago the Supreme Court, in Rodriguez De
Quijas v. Shearson/American Express Inc., 109 S. Ct. 1917 (1989),
expressly overruled Wilko, and held that a predispute agreement to
arbitrate was validly applicable to a claim under section 12(2) of
the Securities Act and was not invalided by section 14 thereof.21
Rodriguez observed that Wilko’s “characterization of the
arbitration process” was “pervaded by . . . ‘the old judicial
hostility to arbitration’” which had become “outmoded” and had
“fallen far out of step with our current strong endorsement of the
federal statutes favoring this method of resolving disputes.” Id.
at 1920. It rejected the Wilko’s holding “that § 14 did not permit
waiver of ‘the right to select the judicial forum’”, id. at 1919,
on the ground that “[b]y agreeing to arbitrate a statutory claim,
a party does not forgo the substantive rights afforded by the
statute; it only submits to their resolution in an arbitral, rather
than a judicial, forum.’” Id. at 1920 (internal quotation marks
and citation omitted). It likewise held, with reference to the
procedural litigation provisions contained in the Securities Act,
21
Appellant’s counsel neglected to note in any of his pre-
oral argument briefing that Wilko had been overruled, and only
after oral argument, at which the matter was called to his
attention, did he, with our permission, file a post-submission
brief recognizing that fact.
24
such as “the statute’s broad venue provisions,” “nationwide service
of process” and “concurrent jurisdiction in the state and federal
courts without possibility of removal,” that: “There is no sound
basis for construing the prohibition in § 14 on waiving ‘compliance
with any provision’ of the Securities Act to apply to these
procedural provisions.” Id. These holdings are similarly
applicable here. Under the arbitration agreement, Terrebonne “does
not forgo the substantive rights afforded by” the Jones Act (and
the general maritime law), he “only submits to their resolution in
an arbitral, rather than a judicial, forum.”
Terrebonne argues in his post-submission brief (see note 21
supra) that Rodriguez is restricted to “business transactions.”
That argument, however, is clearly refuted by Gilmer, which relied
on, inter alia, Rodriguez, to enforce under the FAA a pre-dispute
arbitration agreement as applied to an individual employee’s claim
under the Age Discrimination in Employment Act. See Gilmer, 111
S. Ct. at 1652, 1654, 1655.22
In this connection, Terrebonne further passingly contends, in
22
See also, e.g., Circuit City Stores, Inc. v. Adams, 121
S. Ct. 1302, 1313 (2001), (“The Court has been quite specific in
holding that arbitration agreements can be enforced under the FAA
without contravening the policies of congressional enactments
giving employees specific protection against discrimination
prohibited by federal law. . .”); Garrett v. Circuit City Stores,
Inc., 449 F.3d 672 (5th Cir. 2006) (Uniformed Services Employment
and Reemployment Rights Act); Carter v. Countrywide Credit
Industries, Inc., 362 F.3d 294 (5th Cir. 2004) (Fair Labor
Standards Act); Alford v. Dean Witter Reynolds, Inc., 939 F.2d
229 (5th Cir. 1991) (Title VII).
25
a most conclusory fashion, that requiring arbitration of a seaman’s
Jones Act claim is contrary to public policy. But, as noted above,
the FAA “establishes a federal policy favoring arbitration.”
McMahon at 2337. The burden is on Terrebonne to show a contrary
and compelling public interest. Gilmer at 1652. Terrebonne has
made no such showing. “Having made the bargain to arbitrate, the
party should be held to it unless Congress itself has evinced an
intention to preclude a waiver of judicial remedies for the
statutory rights at issue.” Gilmer at 1652 (citation and inside
quotation marks omitted).23 The only such indication on the part
of Congress is the concluding clause of section 1 of the FAA which
expressly exempts from the FAA, and from the binding effect it
gives to pre-dispute contracts to arbitrate, “contracts of
employment of seamen, railroad employees,” or other such in-
commerce transportation workers. Beyond that express exemption,
there is certainly no more public policy reason to exempt seamen
from the binding effect of pre-dispute contracts – other than
contracts of employment – to arbitrate Jones Act or general
maritime law claims against their employer than there is to exempt
23
In Gilmer the Court held ADEA claims subject to a pre-
dispute agreement to arbitrate notwithstanding “the recent
amendments to the ADEA.” Id. at 1653-54. We note that “the
recent amendments” referred to are apparently those of Pub. L.
101-433, Title II, § 201, October 16, 1990, 104 Stat. 983,
codified at 29 U.S.C. § 626(f)(1), which provide in part that
“the individual does not waive rights or claims that may arise
after the date the waiver is executed.” § 626(f)(1)(C).
26
employees protected by the various civil rights or employee
protection statutes from the binding effect of pre-dispute
contracts to arbitrate claims under such statutes against their
employer. See Gilmer and note 22 supra.
This comports with our decision in Freudensprung v. Offshore
Technical Services, Inc., 379 F.3d 327 (5th Cir. 2004), where we
affirmed the district court’s orders staying litigation of the
plaintiff’s Jones Act claim pending arbitration. Id. at 332. We
noted that “the Convention on the Recognition and Enforcement of
Foreign Arbitral Awards,” 9 U.S.C. §§ 201-208, “governs
concurrently with the FAA in this case.” Id. at 338. We held that
“even assuming arguendo that the Consultant’s Agreement [by which
the defendant retained the plaintiff] is a seaman’s employment
contract, the arbitration agreement contained therein is
nonetheless enforceable pursuant to the Convention . . . .” Id.
We rejected the plaintiff’s argument
“. . . that a ‘pre-injury’ agreement to arbitrate rather
than litigate his personal injury claims is ‘inherently
unfair’ because he could not have made an informed
decision concerning his post-injury remedies before his
injury had occurred and before any medical advice was
available to him. The difficulty with this argument is
that the same could be said of any advance agreement to
arbitrate personal injury claims, and it is by now beyond
cavil that such agreements are presumptively enforceable.
As noted above, Freudensprung and OTSI agreed to
arbitrate ‘any dispute’ arising out of the Consultant’s
Agreement. It is ‘[o]nly by rigorously enforcing
arbitration agreements according to their terms, do we
“give effect to the contractual rights and expectations
of the parties, without doing violence to the policies
behind the FAA.”’ Ford v. NYLCare Health Plans of Gulf
27
Coast, Inc., 141 F.3d 243, 248-49 (5th Cir. 1998)
(quoting Volt Information Sci., Inc. v. Bd. of Trustees
of Leland Stanford Junior Univ., 489 U.S. 468, 479, 109
S. Ct. 1248, 103 L. Ed. 2d 488 (1989).” Id. at 342.
The plain implication is that if the agreement was not contained in
a seaman’s contract of employment it would be enforceable under the
FAA.
We observe that, beyond vague references to the unfairness of
pre-injury arbitration agreements (of seamen and of others)
generally and generically, Terrebonne has never asserted in this
case (or urged on this appeal) that the March 12, 2001 agreement
here was invalid because it was not (or was not shown to be)
sufficiently voluntary, informed and understood on his part, or
because the amount paid for damages incurred up until March 12,
2001 was not (or was not shown to be) fair and adequate, or because
the agreement was not otherwise sufficiently fair or shown to be
so. Terrebonne’s public policy arguments lack merit.
B. Scope of the Arbitration Agreement
In addition to challenging the arbitration agreement’s
enforceability, Terrebonne asserts that if the agreement is
enforceable, his “re-injury” is separate from his prior hernia and
thus outside the agreement’s coverage. We hold that the district
court did not err in compelling arbitration or confirming the
arbitration award on this basis; the agreement was sufficiently
broad for the district court to compel arbitration and allow the
arbitration panel to determine its scope.
28
The agreement clearly states that it encompasses “any claims
related” to Terrebonne’s November 2000 injury. Terrebonne’s
complaint in this action is for damages for both his 2000 accident
and his April 2001 “re-injury.” Terrebonne has nowhere asserted
that he is only or even mainly asking for damages for his reinjury.
Further, Terrebonne has not explained anywhere how these two are
different. Thus, in light of Terrebonne’s complaint—which lumps
together the November 2000 and April 2001 injuries—the arbitration
agreement was broad enough to be submitted to the arbitrators for
determination of whether Terrebonne’s reinjury fell within the
agreement’s scope. See in re Complaint of Hornbeck Offshore (1984)
Corp., 981 F.2d 752, 754–55 (5th Cir. 1993) (stating that this
court distinguishes between broad and narrow arbitration clauses,
and explaining, “If the clause is broad, the action should be
stayed and the arbitrators permitted to decide whether the dispute
falls within the clause”). We conclude that the arbitration clause
is broad. See, e.g., Hornbeck Offshore at 755 (“any dispute” is
broad) and Beiser v. Weyler, 284 F.3d 665, 669-70 (5th Cir. 2002)
(“relates to” has a “plainly broad meaning”). Terrebonne has not
attacked the award rendered by the arbitration panel; nor has he
attacked the arbitrators’ decision that the reinjury fell within
the agreement’s scope.
CONCLUSION
Terrebonne has shown no valid basis on which to reverse the
29
district court’s decision to compel arbitration. The district
court’s judgment is accordingly
AFFIRMED.
30