On June 30, in a unanimous opinion, the Fifth Circuit affirmed most parts of a district court victory on behalf of Hornbeck Offshore Services against the former R&R Marine shipyard in Port Arthur, Texas, and its liability insurer. This will result in a $1.2 million judgment, plus interest, in Hornbeck’s favor. The judgment includes both prejudgment interest and attorneys’ fees. The case arose when Hornbeck’s tug ERIE SERVICE was undergoing major repairs in September 2007 at R&R’s dock . The ship repair facility negligently took insufficient steps to protect the vessel from water ingress from a quickly developing tropical storm. Heavy rain and wave action on Sabine Lake caused the unprotected tug to fill with water and sink.

R&R and its liability insurer refused to pay for the tug’s salvage or for any damages, and the insurer began a declaratory judgment action in Houston to avoid coverage.

In its twenty-page opinion, the Fifth Circuit affirmed the district court’s conclusion that R&R had full custody of the ERIE SERVICE while at its shipyard, but failed to exercise due care and was negligent. The court also affirmed R&R’s liability for all of the time-and-materials salvage charges, noting that even if the salvage company had damaged the tug while trying to raise it, R&R would remain liable because that damage would have been a foreseeable consequence of R&R’s negligence.

Although Texas is not a direct action state, the Fifth Circuit upheld the judgment against R&R’s liability insurer because it had subjected itself to Hornbeck’s compulsory counterclaim by commencing its declaratory judgment action. The Fifth Circuit reduced the judgment to the $1 million policy limit, but rejected the insurer’s argument that the policy limits should be further reduced by the attorneys’ fees it had incurred defending itself. The court reversed the district court’s 18% penalty interest award, but allowed Hornbeck prejudgment interest at 6%, and affirmed a substantial attorneys’ fees award in Hornbeck’s favor.

Stacey Norstrud (Houston) and Skipper Chenault (New Orleans) tried the liability phase of the case, with Tim Strickland (Houston) assisting Norstrud in the damages portion. After opponents appealed the district court’s judgment, Norstrud, Mike Harowski (New Orleans), Toney Rodriguez (New Orleans) and Chenault prepared Hornbeck’s brief, and Chenault argued before the Fifth Circuit. New Orleans paralegal Rachel Ricca was a great help throughout.

National Liability & Fire Insurance v. R & R Marine, No. 10-20767 (5th Cir., June 30, 2014).

New Orleans attorneys A.T. Chenault, Philip Brickman and Susan Keller-Garcia recently prevailed on behalf of Apex Oil Company and Trinidad Corporation on an exception of discharge in bankruptcy on behalf of a vessel owner in a Jones Act suit in the 19th Judicial District Court for East Baton Rouge Parish. The plaintiff alleged that he developed mesothelioma as a result of asbestos exposure on the clients’ vessel in 1966.

Fowler Rodriguez successfully argued that the plaintiff’s claims were discharged by the confirmation of the owner’s Chapter 11 reorganization plan by a Missouri bankruptcy court in 1990. The court’s ruling in the client’s favor directly resulted in a very favorable settlement of the plaintiff’s claims that was well below the plaintiff’s earlier demands.

Houston Mall Defended
Michael W. McCoy, with Allison Hooker, Sherry Weaver, and others, stepped in to defend well-known West Oaks Mall, essentially on the eve of trial. The case involved a personal injury lawsuit as a result of a certified air conditioning/heating specialist being shocked, blown off a ladder, and allegedly and severely injured as a result, while working on the A/C system on behalf of a tenant at West Oaks Mall. The case involved serious factual and legal issues, and resulted in difficult and protracted settlement negotiations after the filing of outstanding defense motions. One day before the final pre-trial conference, and only a few days before the actual trial, a settlement was achieved for less than the total medical lien, and much less than the total medical incurred by the Plaintiff.

Premise Liability Resolved in Favor of Houston Night Club
Very recently, McCoy and his team, including Allison Hooker, were successful in resolving a premises liability case which took place at a well-known nightclub in Houston. McCoy represented the owner of the club, but not the operator. McCoy was successful in demonstrating through documents and through a comprehensive Motion for Summary Judgment that the owner owed few, if any, duties to the particular patron who was severely injured by a bouncer, employed by the club operator, while escorting the Plaintiff out of the club.In fact, the bouncer was charged and pled guilty to felonious assault. However, through outstanding defense motions, it was shown from both a factual and legal standpoint that the owner had little or no liability, and the case settled at mediation for essentially nuisance value, despite a contention of mid-five figures in medical costs, and a prior demand for the $1,000,000.00 policy limit.

Property Damage Case Dismissed
A few weeks later, McCoy was successful in persuading Plaintiff’s counsel to dismiss a lawsuit against an insurance agent, who had placed a trucking policy that did not provide for property damage insurance coverage on behalf of the cab/tractor/trailer rigs, if such tractor/trailers were individually owned by the driver for the trucking company. A particular driver who had her truck stolen had sued, contending that the agent had allegedly misrepresented such coverages. McCoy and his team, including Allison Hooker, were successful through discovery in demonstrating that the Plaintiff driver had no privity with the agent, and that she could not have properly relied on any alleged misrepresentations by the agent, which would have thus, entitled the agent to summary judgment and possible attorney’s fees. McCoy was successful in getting the case dismissed without incurring large defense costs.

In 2004, approximately 824 plaintiffs filed suit in 23 multi-party actions in Mississippi alleging that they had been exposed to asbestos in drilling mud. The lawsuits were aimed primarily at the manufacturers of the asbestos products, including Conoco/Phillips and Union Carbide, as well as many distributors located throughout Mississippi and the Gulf states. Many offshore drilling companies were also named as defendants. Some of these cases were transferred to the multi-district litigation in Pennsylvania, but the vast majority of them settled into two jurisdictions in State Court in Mississippi. ENSCO Offshore Company was named a party defendant in 62 of the 700 cases.

In February 2013, over eight years later, those 62 cases were transferred to Delos Flint and the Fowler Rodriguez Gulfport office. Working with Todd Crawford, Chris Schmidt and Skip Negrotto, Flint was able to evaluate the cases. He settled one that was scheduled for trial immediately and quickly secured dismissals of three others. The Gulfport team then analyzed the medical data and Flint and Crawford came up with a plan to prioritize the claims and began taking the necessary steps to defend them and put them in a posture for Summary Judgment or trial.

In late December 2013, Dee Flint and Todd Crawford traveled to Houston, Texas to meet with plaintiffs’ counsel and reached an agreement to settle the remaining 58 cases on favorable terms. The client, ENSCO Offshore Company, was pleased to get 62 cases that had been pending for nearly ten years resolved and off of their books in less than one year after the cases were transferred to Fowler Rodriguez for handling.

Miami partner, Juan E. Serralles, Esq., recently negotiated franchise and licensing deals for two new South Florida hotels to operate under known hotel brands. Mr. Serralles has long represented South American hotel developers and operators who are focused on penetrating South Florida’s market. The most recent deals have involved negotiating two separate license/franchise deals for “mixed use” deals concerning his client, involving projects with a combination of hotel rooms, condominium units and retail facilities within the respective projects.

Mr. Serralles finalized license agreements with Holiday Hospitality Franchising, LLC, granting permissions for his client to operate a 140-room “Indigo Hotel” in the existing vibrant Brickell West area in Miami’s financial district. The other deal concerning the Sheraton, LLC, also known as ‘Starwood Hotels,’ involved finalizing a license agreement to allow Mr. Serralles’ client to operate an “Aloft Hotel” in the City of Coral Gables downtown area, which will culminate in the construction of a $32 million, 160-room hotel project. Both hotels have commenced construction.

Jon W. Wise recently concluded a lengthy trial in the 31st Judicial District Court for the Parish of Jefferson Davis, which resulted in a zero verdict in favor of the firm’s clients. The case was brought against clients Crimson Exploration, Inc., Anadarko Petroleum, Kerr-McGee and several other oil and gas companies on behalf of a group of landowners who were mineral royalty interest owners within producing units drained by two wells drilled in 1999. Seeking $16 million in damages, the plaintiffs claimed they were deprived of royalty revenue from these units due to the fact that the reservoirs were allegedly “destroyed” by the completion and/or workover of the wells by the operator defendants. Specifically, the plaintiffs alleged that improper cementing practices and well designs had permitted the incursion of extraneous water from nearby formations into the producing formations via the well bore and caused the producing formations to water out prematurely. This was an unprecedented claim, as there had been no prior cases where a court in Louisiana had awarded this type of damage principally because of the problems of proving the existence of damages.

The trial took over ten months to be completed in 2012 and was tried by a single judge. The opinion, which the trial court issued in May 2013, resulted in a finding of no liability on the part of the defendants. The case likely will be appealed, but the opinion of the court represents a major victory for oil and gas operators throughout the state.

The Gulfport trial and appellate team of John A. Scialdone, Todd G. Crawford and John S. Garner successfully navigated the troubled waters of maritime presumptions through the United States District Court for the Eastern District of Louisiana and United States Court of Appeals for the Fifth Circuit. In Mike Hooks Dredging Co. v. Marquette Transportation Co. Gulf-Inland, 716 F.3d 886 (5th Cir. 2013), the Fifth Circuit affirmed the district court’s apportionment of fault of 70% to plaintiff Mike Hooks Dredging Co. as operator of the dredge MIKE HOOKS; 15% to third party defendant Vizier, as operator of a picket boat required to physically assist passing navigation by the dredge under a Corps of Engineers contract; and the remaining 15% fault to Fowler Rodriguez’s client Marquette, as the operator of the PAT MCDANIEL, a tug that allided with the stationary dredge at the intersection of the Intracoastal Waterway near the Wax Lake Outlet in South Central Louisiana.

Mike Hooks claimed our client, Marquette’s, tug boat was solely at fault for striking its moored dredge, relying on the presumption of fault under the Oregon rule that when a moving vessel collides with a stationary object in the water, the moving vessel is presumed at fault and must prove it is not at fault. As the Gulfport trial team developed further evidence through discovery, however, other general maritime law presumptions began to swing in Marquette’s favor. For example, the dredge was required to provide a picket boat to comply with its dredging contract with the U.S. Corps of Engineers. Fowler Rodriguez also uncovered statements taken from Hooks’ employees that showed key dredge personnel knew the picket boat, operated by Vizier, refused to assist “passing vessels in navigation” as expressly required by the Corps contract. Nonetheless, the dredge proceeded to a dangerous location in the Intracoastal Waterway where currents intersect and create difficulty in navigation. Gulfport attorneys presented evidence of two near misses by vessels attempting to pass the dredge: a grounding caused by the heavy current that set the vessel to the southern bank of the intersection, and another collision with the dredge only a few hours before Marquette’s tug attempted to pass.

Fowler Rodriguez successfully rebutted the presumption against Marquette under the Oregon rule by arguing that the dredge violated the narrow channel rule, Inland Rule 9 (“INR9”), codified at 33 CFR § 83.09, which provides: “Avoidance of anchoring in narrow channels: Every vessel shall, if the circumstances of the case permit, avoid anchoring in a narrow channel.” The district court found Marquette had presented sufficient evidence to overcome the adverse presumption of the Oregon rule, agreed that Hooks violated the narrow channel rule and ultimately held that Hooks could not rebut the presumption triggered by the rule of the Pennsylvania, 86 U.S. (19 Wall) 125, 22 L.Ed. 148 (1874), which requires the offending vessel to show the statutory rule violation was “not merely her fault and might not have been one of the causes, or that it probably was not, but that it could not have been.”

The Fifth Circuit affirmed the district court’s apportionment of fault in all respects, but not without some questions on the interplay of these presumptions. The Gulfport appellate team emphasized that the Pennsylvania rule shifts the burden of persuasion to the offending vessel to show that particular statutory violation could not have been the cause of the incident. The Fifth Circuit agreed and wrote, “We agree with the district court that INR 9(g) establishes such a clear legal duty. The regulation expressly prohibits vessels from anchoring in narrow channels, except in exceptional circumstances.”

The Fifth Circuit panel also rejected Hooks’ legal argument that INR 9(g) is inapplicable unless the vessel is first found to be an obstruction. Instead, the panel agreed with the statutory interpretation and analysis offered by Gulfport Appellate Counsel and affirmed the 70% allocation of fault: “INR 9(g) is unambiguous. The rule (“shall…avoid”) expressly prohibits vessels from anchoring in narrow channels, subject only to the exception where circumstances do not permit alternative action.”

Ultimately, the Appellate Court affirmed the District Court’s judgment of liability in all respects. Like the Fifth Circuit opinion, the district court opinion provides useful guidance on navigating the troubled waters created by the presumptions in maritime law.

Fowler Rodriguez attorneys Edward F. LeBreton, III and Stuart Ponder successfully appealed a summary judgment to the United States Fifth Circuit Court of Appeals.

LeBreton and Ponder represented the Board of Commissioners for the Port of New Orleans in litigation against one of its bumbershoot insurers, Insurance Company of North America. The district court granted summary judgment in favor of INA on the basis that lack of notice to one of three severally subscribing insurers relieved all insurers of their obligations under the policy.

On appeal, the Board argued that, because the insurers’ obligations were several, notice to one insurer satisfied the requirement as to that insurer, regardless of possible lack of notice to one of the other insurers. In a per curium opinion, the Fifth Circuit held that any insurer who receives notice is obligated to provide its proportion of the coverage. More specifically, the duty of coverage is triggered for each insurer who receives notice under the policy. The Fifth Circuit remanded the case to the district court for further proceedings. The opinion may be found at Ins. Co. of N. Am. v. Bd. of Comm’rs of the Port of New Orleans, no. 12-30705, 2013 U.S. App. LEXIS 8884, 2013WL 1811892 (5th Cir. La. May 1, 2013).

On June 30, in a unanimous opinion, the Fifth Circuit affirmed most parts of a district court victory on behalf of Hornbeck Offshore Services against the former R&R Marine shipyard in Port Arthur, Texas, and its liability insurer. This will result in a $1.2 million judgment, plus interest, in Hornbeck’s favor. The judgment includes both prejudgment interest and attorneys’ fees. The case arose when Hornbeck’s tug ERIE SERVICE was undergoing major repairs in September 2007 at R&R’s dock . The ship repair facility negligently took insufficient steps to protect the vessel from water ingress from a quickly developing tropical storm. Heavy rain and wave action on Sabine Lake caused the unprotected tug to fill with water and sink.

R&R and its liability insurer refused to pay for the tug’s salvage or for any damages, and the insurer began a declaratory judgment action in Houston to avoid coverage.

In its twenty-page opinion, the Fifth Circuit affirmed the district court’s conclusion that R&R had full custody of the ERIE SERVICE while at its shipyard, but failed to exercise due care and was negligent. The court also affirmed R&R’s liability for all of the time-and-materials salvage charges, noting that even if the salvage company had damaged the tug while trying to raise it, R&R would remain liable because that damage would have been a foreseeable consequence of R&R’s negligence.

Although Texas is not a direct action state, the Fifth Circuit upheld the judgment against R&R’s liability insurer because it had subjected itself to Hornbeck’s compulsory counterclaim by commencing its declaratory judgment action. The Fifth Circuit reduced the judgment to the $1 million policy limit, but rejected the insurer’s argument that the policy limits should be further reduced by the attorneys’ fees it had incurred defending itself. The court reversed the district court’s 18% penalty interest award, but allowed Hornbeck prejudgment interest at 6%, and affirmed a substantial attorneys’ fees award in Hornbeck’s favor.

Stacey Norstrud (Houston) and Skipper Chenault (New Orleans) tried the liability phase of the case, with Tim Strickland (Houston) assisting Norstrud in the damages portion. After opponents appealed the district court’s judgment, Norstrud, Mike Harowski (New Orleans), Toney Rodriguez (New Orleans) and Chenault prepared Hornbeck’s brief, and Chenault argued before the Fifth Circuit. New Orleans paralegal Rachel Ricca was a great help throughout.

National Liability & Fire Insurance v. R & R Marine, No. 10-20767 (5th Cir., June 30, 2014).

New Orleans attorneys A.T. Chenault, Philip Brickman and Susan Keller-Garcia recently prevailed on behalf of Apex Oil Company and Trinidad Corporation on an exception of discharge in bankruptcy on behalf of a vessel owner in a Jones Act suit in the 19th Judicial District Court for East Baton Rouge Parish. The plaintiff alleged that he developed mesothelioma as a result of asbestos exposure on the clients’ vessel in 1966.

Fowler Rodriguez successfully argued that the plaintiff’s claims were discharged by the confirmation of the owner’s Chapter 11 reorganization plan by a Missouri bankruptcy court in 1990. The court’s ruling in the client’s favor directly resulted in a very favorable settlement of the plaintiff’s claims that was well below the plaintiff’s earlier demands.

Houston Mall Defended
Michael W. McCoy, with Allison Hooker, Sherry Weaver, and others, stepped in to defend well-known West Oaks Mall, essentially on the eve of trial. The case involved a personal injury lawsuit as a result of a certified air conditioning/heating specialist being shocked, blown off a ladder, and allegedly and severely injured as a result, while working on the A/C system on behalf of a tenant at West Oaks Mall. The case involved serious factual and legal issues, and resulted in difficult and protracted settlement negotiations after the filing of outstanding defense motions. One day before the final pre-trial conference, and only a few days before the actual trial, a settlement was achieved for less than the total medical lien, and much less than the total medical incurred by the Plaintiff.

Premise Liability Resolved in Favor of Houston Night Club
Very recently, McCoy and his team, including Allison Hooker, were successful in resolving a premises liability case which took place at a well-known nightclub in Houston. McCoy represented the owner of the club, but not the operator. McCoy was successful in demonstrating through documents and through a comprehensive Motion for Summary Judgment that the owner owed few, if any, duties to the particular patron who was severely injured by a bouncer, employed by the club operator, while escorting the Plaintiff out of the club.In fact, the bouncer was charged and pled guilty to felonious assault. However, through outstanding defense motions, it was shown from both a factual and legal standpoint that the owner had little or no liability, and the case settled at mediation for essentially nuisance value, despite a contention of mid-five figures in medical costs, and a prior demand for the $1,000,000.00 policy limit.

Property Damage Case Dismissed
A few weeks later, McCoy was successful in persuading Plaintiff’s counsel to dismiss a lawsuit against an insurance agent, who had placed a trucking policy that did not provide for property damage insurance coverage on behalf of the cab/tractor/trailer rigs, if such tractor/trailers were individually owned by the driver for the trucking company. A particular driver who had her truck stolen had sued, contending that the agent had allegedly misrepresented such coverages. McCoy and his team, including Allison Hooker, were successful through discovery in demonstrating that the Plaintiff driver had no privity with the agent, and that she could not have properly relied on any alleged misrepresentations by the agent, which would have thus, entitled the agent to summary judgment and possible attorney’s fees. McCoy was successful in getting the case dismissed without incurring large defense costs.

In 2004, approximately 824 plaintiffs filed suit in 23 multi-party actions in Mississippi alleging that they had been exposed to asbestos in drilling mud. The lawsuits were aimed primarily at the manufacturers of the asbestos products, including Conoco/Phillips and Union Carbide, as well as many distributors located throughout Mississippi and the Gulf states. Many offshore drilling companies were also named as defendants. Some of these cases were transferred to the multi-district litigation in Pennsylvania, but the vast majority of them settled into two jurisdictions in State Court in Mississippi. ENSCO Offshore Company was named a party defendant in 62 of the 700 cases.

In February 2013, over eight years later, those 62 cases were transferred to Delos Flint and the Fowler Rodriguez Gulfport office. Working with Todd Crawford, Chris Schmidt and Skip Negrotto, Flint was able to evaluate the cases. He settled one that was scheduled for trial immediately and quickly secured dismissals of three others. The Gulfport team then analyzed the medical data and Flint and Crawford came up with a plan to prioritize the claims and began taking the necessary steps to defend them and put them in a posture for Summary Judgment or trial.

In late December 2013, Dee Flint and Todd Crawford traveled to Houston, Texas to meet with plaintiffs’ counsel and reached an agreement to settle the remaining 58 cases on favorable terms. The client, ENSCO Offshore Company, was pleased to get 62 cases that had been pending for nearly ten years resolved and off of their books in less than one year after the cases were transferred to Fowler Rodriguez for handling.

Miami partner, Juan E. Serralles, Esq., recently negotiated franchise and licensing deals for two new South Florida hotels to operate under known hotel brands. Mr. Serralles has long represented South American hotel developers and operators who are focused on penetrating South Florida’s market. The most recent deals have involved negotiating two separate license/franchise deals for “mixed use” deals concerning his client, involving projects with a combination of hotel rooms, condominium units and retail facilities within the respective projects.

Mr. Serralles finalized license agreements with Holiday Hospitality Franchising, LLC, granting permissions for his client to operate a 140-room “Indigo Hotel” in the existing vibrant Brickell West area in Miami’s financial district. The other deal concerning the Sheraton, LLC, also known as ‘Starwood Hotels,’ involved finalizing a license agreement to allow Mr. Serralles’ client to operate an “Aloft Hotel” in the City of Coral Gables downtown area, which will culminate in the construction of a $32 million, 160-room hotel project. Both hotels have commenced construction.

Jon W. Wise recently concluded a lengthy trial in the 31st Judicial District Court for the Parish of Jefferson Davis, which resulted in a zero verdict in favor of the firm’s clients. The case was brought against clients Crimson Exploration, Inc., Anadarko Petroleum, Kerr-McGee and several other oil and gas companies on behalf of a group of landowners who were mineral royalty interest owners within producing units drained by two wells drilled in 1999. Seeking $16 million in damages, the plaintiffs claimed they were deprived of royalty revenue from these units due to the fact that the reservoirs were allegedly “destroyed” by the completion and/or workover of the wells by the operator defendants. Specifically, the plaintiffs alleged that improper cementing practices and well designs had permitted the incursion of extraneous water from nearby formations into the producing formations via the well bore and caused the producing formations to water out prematurely. This was an unprecedented claim, as there had been no prior cases where a court in Louisiana had awarded this type of damage principally because of the problems of proving the existence of damages.

The trial took over ten months to be completed in 2012 and was tried by a single judge. The opinion, which the trial court issued in May 2013, resulted in a finding of no liability on the part of the defendants. The case likely will be appealed, but the opinion of the court represents a major victory for oil and gas operators throughout the state.

The Gulfport trial and appellate team of John A. Scialdone, Todd G. Crawford and John S. Garner successfully navigated the troubled waters of maritime presumptions through the United States District Court for the Eastern District of Louisiana and United States Court of Appeals for the Fifth Circuit. In Mike Hooks Dredging Co. v. Marquette Transportation Co. Gulf-Inland, 716 F.3d 886 (5th Cir. 2013), the Fifth Circuit affirmed the district court’s apportionment of fault of 70% to plaintiff Mike Hooks Dredging Co. as operator of the dredge MIKE HOOKS; 15% to third party defendant Vizier, as operator of a picket boat required to physically assist passing navigation by the dredge under a Corps of Engineers contract; and the remaining 15% fault to Fowler Rodriguez’s client Marquette, as the operator of the PAT MCDANIEL, a tug that allided with the stationary dredge at the intersection of the Intracoastal Waterway near the Wax Lake Outlet in South Central Louisiana.

Mike Hooks claimed our client, Marquette’s, tug boat was solely at fault for striking its moored dredge, relying on the presumption of fault under the Oregon rule that when a moving vessel collides with a stationary object in the water, the moving vessel is presumed at fault and must prove it is not at fault. As the Gulfport trial team developed further evidence through discovery, however, other general maritime law presumptions began to swing in Marquette’s favor. For example, the dredge was required to provide a picket boat to comply with its dredging contract with the U.S. Corps of Engineers. Fowler Rodriguez also uncovered statements taken from Hooks’ employees that showed key dredge personnel knew the picket boat, operated by Vizier, refused to assist “passing vessels in navigation” as expressly required by the Corps contract. Nonetheless, the dredge proceeded to a dangerous location in the Intracoastal Waterway where currents intersect and create difficulty in navigation. Gulfport attorneys presented evidence of two near misses by vessels attempting to pass the dredge: a grounding caused by the heavy current that set the vessel to the southern bank of the intersection, and another collision with the dredge only a few hours before Marquette’s tug attempted to pass.

Fowler Rodriguez successfully rebutted the presumption against Marquette under the Oregon rule by arguing that the dredge violated the narrow channel rule, Inland Rule 9 (“INR9”), codified at 33 CFR § 83.09, which provides: “Avoidance of anchoring in narrow channels: Every vessel shall, if the circumstances of the case permit, avoid anchoring in a narrow channel.” The district court found Marquette had presented sufficient evidence to overcome the adverse presumption of the Oregon rule, agreed that Hooks violated the narrow channel rule and ultimately held that Hooks could not rebut the presumption triggered by the rule of the Pennsylvania, 86 U.S. (19 Wall) 125, 22 L.Ed. 148 (1874), which requires the offending vessel to show the statutory rule violation was “not merely her fault and might not have been one of the causes, or that it probably was not, but that it could not have been.”

The Fifth Circuit affirmed the district court’s apportionment of fault in all respects, but not without some questions on the interplay of these presumptions. The Gulfport appellate team emphasized that the Pennsylvania rule shifts the burden of persuasion to the offending vessel to show that particular statutory violation could not have been the cause of the incident. The Fifth Circuit agreed and wrote, “We agree with the district court that INR 9(g) establishes such a clear legal duty. The regulation expressly prohibits vessels from anchoring in narrow channels, except in exceptional circumstances.”

The Fifth Circuit panel also rejected Hooks’ legal argument that INR 9(g) is inapplicable unless the vessel is first found to be an obstruction. Instead, the panel agreed with the statutory interpretation and analysis offered by Gulfport Appellate Counsel and affirmed the 70% allocation of fault: “INR 9(g) is unambiguous. The rule (“shall…avoid”) expressly prohibits vessels from anchoring in narrow channels, subject only to the exception where circumstances do not permit alternative action.”

Ultimately, the Appellate Court affirmed the District Court’s judgment of liability in all respects. Like the Fifth Circuit opinion, the district court opinion provides useful guidance on navigating the troubled waters created by the presumptions in maritime law.

Fowler Rodriguez attorneys Edward F. LeBreton, III and Stuart Ponder successfully appealed a summary judgment to the United States Fifth Circuit Court of Appeals.

LeBreton and Ponder represented the Board of Commissioners for the Port of New Orleans in litigation against one of its bumbershoot insurers, Insurance Company of North America. The district court granted summary judgment in favor of INA on the basis that lack of notice to one of three severally subscribing insurers relieved all insurers of their obligations under the policy.

On appeal, the Board argued that, because the insurers’ obligations were several, notice to one insurer satisfied the requirement as to that insurer, regardless of possible lack of notice to one of the other insurers. In a per curium opinion, the Fifth Circuit held that any insurer who receives notice is obligated to provide its proportion of the coverage. More specifically, the duty of coverage is triggered for each insurer who receives notice under the policy. The Fifth Circuit remanded the case to the district court for further proceedings. The opinion may be found at Ins. Co. of N. Am. v. Bd. of Comm’rs of the Port of New Orleans, no. 12-30705, 2013 U.S. App. LEXIS 8884, 2013WL 1811892 (5th Cir. La. May 1, 2013).

On June 30, in a unanimous opinion, the Fifth Circuit affirmed most parts of a district court victory on behalf of Hornbeck Offshore Services against the former R&R Marine shipyard in Port Arthur, Texas, and its liability insurer. This will result in a $1.2 million judgment, plus interest, in Hornbeck’s favor. The judgment includes both prejudgment interest and attorneys’ fees. The case arose when Hornbeck’s tug ERIE SERVICE was undergoing major repairs in September 2007 at R&R’s dock . The ship repair facility negligently took insufficient steps to protect the vessel from water ingress from a quickly developing tropical storm. Heavy rain and wave action on Sabine Lake caused the unprotected tug to fill with water and sink.

R&R and its liability insurer refused to pay for the tug’s salvage or for any damages, and the insurer began a declaratory judgment action in Houston to avoid coverage.

In its twenty-page opinion, the Fifth Circuit affirmed the district court’s conclusion that R&R had full custody of the ERIE SERVICE while at its shipyard, but failed to exercise due care and was negligent. The court also affirmed R&R’s liability for all of the time-and-materials salvage charges, noting that even if the salvage company had damaged the tug while trying to raise it, R&R would remain liable because that damage would have been a foreseeable consequence of R&R’s negligence.

Although Texas is not a direct action state, the Fifth Circuit upheld the judgment against R&R’s liability insurer because it had subjected itself to Hornbeck’s compulsory counterclaim by commencing its declaratory judgment action. The Fifth Circuit reduced the judgment to the $1 million policy limit, but rejected the insurer’s argument that the policy limits should be further reduced by the attorneys’ fees it had incurred defending itself. The court reversed the district court’s 18% penalty interest award, but allowed Hornbeck prejudgment interest at 6%, and affirmed a substantial attorneys’ fees award in Hornbeck’s favor.

Stacey Norstrud (Houston) and Skipper Chenault (New Orleans) tried the liability phase of the case, with Tim Strickland (Houston) assisting Norstrud in the damages portion. After opponents appealed the district court’s judgment, Norstrud, Mike Harowski (New Orleans), Toney Rodriguez (New Orleans) and Chenault prepared Hornbeck’s brief, and Chenault argued before the Fifth Circuit. New Orleans paralegal Rachel Ricca was a great help throughout.

National Liability & Fire Insurance v. R & R Marine, No. 10-20767 (5th Cir., June 30, 2014).

New Orleans attorneys A.T. Chenault, Philip Brickman and Susan Keller-Garcia recently prevailed on behalf of Apex Oil Company and Trinidad Corporation on an exception of discharge in bankruptcy on behalf of a vessel owner in a Jones Act suit in the 19th Judicial District Court for East Baton Rouge Parish. The plaintiff alleged that he developed mesothelioma as a result of asbestos exposure on the clients’ vessel in 1966.

Fowler Rodriguez successfully argued that the plaintiff’s claims were discharged by the confirmation of the owner’s Chapter 11 reorganization plan by a Missouri bankruptcy court in 1990. The court’s ruling in the client’s favor directly resulted in a very favorable settlement of the plaintiff’s claims that was well below the plaintiff’s earlier demands.

Houston Mall Defended
Michael W. McCoy, with Allison Hooker, Sherry Weaver, and others, stepped in to defend well-known West Oaks Mall, essentially on the eve of trial. The case involved a personal injury lawsuit as a result of a certified air conditioning/heating specialist being shocked, blown off a ladder, and allegedly and severely injured as a result, while working on the A/C system on behalf of a tenant at West Oaks Mall. The case involved serious factual and legal issues, and resulted in difficult and protracted settlement negotiations after the filing of outstanding defense motions. One day before the final pre-trial conference, and only a few days before the actual trial, a settlement was achieved for less than the total medical lien, and much less than the total medical incurred by the Plaintiff.

Premise Liability Resolved in Favor of Houston Night Club
Very recently, McCoy and his team, including Allison Hooker, were successful in resolving a premises liability case which took place at a well-known nightclub in Houston. McCoy represented the owner of the club, but not the operator. McCoy was successful in demonstrating through documents and through a comprehensive Motion for Summary Judgment that the owner owed few, if any, duties to the particular patron who was severely injured by a bouncer, employed by the club operator, while escorting the Plaintiff out of the club.In fact, the bouncer was charged and pled guilty to felonious assault. However, through outstanding defense motions, it was shown from both a factual and legal standpoint that the owner had little or no liability, and the case settled at mediation for essentially nuisance value, despite a contention of mid-five figures in medical costs, and a prior demand for the $1,000,000.00 policy limit.

Property Damage Case Dismissed
A few weeks later, McCoy was successful in persuading Plaintiff’s counsel to dismiss a lawsuit against an insurance agent, who had placed a trucking policy that did not provide for property damage insurance coverage on behalf of the cab/tractor/trailer rigs, if such tractor/trailers were individually owned by the driver for the trucking company. A particular driver who had her truck stolen had sued, contending that the agent had allegedly misrepresented such coverages. McCoy and his team, including Allison Hooker, were successful through discovery in demonstrating that the Plaintiff driver had no privity with the agent, and that she could not have properly relied on any alleged misrepresentations by the agent, which would have thus, entitled the agent to summary judgment and possible attorney’s fees. McCoy was successful in getting the case dismissed without incurring large defense costs.

In 2004, approximately 824 plaintiffs filed suit in 23 multi-party actions in Mississippi alleging that they had been exposed to asbestos in drilling mud. The lawsuits were aimed primarily at the manufacturers of the asbestos products, including Conoco/Phillips and Union Carbide, as well as many distributors located throughout Mississippi and the Gulf states. Many offshore drilling companies were also named as defendants. Some of these cases were transferred to the multi-district litigation in Pennsylvania, but the vast majority of them settled into two jurisdictions in State Court in Mississippi. ENSCO Offshore Company was named a party defendant in 62 of the 700 cases.

In February 2013, over eight years later, those 62 cases were transferred to Delos Flint and the Fowler Rodriguez Gulfport office. Working with Todd Crawford, Chris Schmidt and Skip Negrotto, Flint was able to evaluate the cases. He settled one that was scheduled for trial immediately and quickly secured dismissals of three others. The Gulfport team then analyzed the medical data and Flint and Crawford came up with a plan to prioritize the claims and began taking the necessary steps to defend them and put them in a posture for Summary Judgment or trial.

In late December 2013, Dee Flint and Todd Crawford traveled to Houston, Texas to meet with plaintiffs’ counsel and reached an agreement to settle the remaining 58 cases on favorable terms. The client, ENSCO Offshore Company, was pleased to get 62 cases that had been pending for nearly ten years resolved and off of their books in less than one year after the cases were transferred to Fowler Rodriguez for handling.

Miami partner, Juan E. Serralles, Esq., recently negotiated franchise and licensing deals for two new South Florida hotels to operate under known hotel brands. Mr. Serralles has long represented South American hotel developers and operators who are focused on penetrating South Florida’s market. The most recent deals have involved negotiating two separate license/franchise deals for “mixed use” deals concerning his client, involving projects with a combination of hotel rooms, condominium units and retail facilities within the respective projects.

Mr. Serralles finalized license agreements with Holiday Hospitality Franchising, LLC, granting permissions for his client to operate a 140-room “Indigo Hotel” in the existing vibrant Brickell West area in Miami’s financial district. The other deal concerning the Sheraton, LLC, also known as ‘Starwood Hotels,’ involved finalizing a license agreement to allow Mr. Serralles’ client to operate an “Aloft Hotel” in the City of Coral Gables downtown area, which will culminate in the construction of a $32 million, 160-room hotel project. Both hotels have commenced construction.

Jon W. Wise recently concluded a lengthy trial in the 31st Judicial District Court for the Parish of Jefferson Davis, which resulted in a zero verdict in favor of the firm’s clients. The case was brought against clients Crimson Exploration, Inc., Anadarko Petroleum, Kerr-McGee and several other oil and gas companies on behalf of a group of landowners who were mineral royalty interest owners within producing units drained by two wells drilled in 1999. Seeking $16 million in damages, the plaintiffs claimed they were deprived of royalty revenue from these units due to the fact that the reservoirs were allegedly “destroyed” by the completion and/or workover of the wells by the operator defendants. Specifically, the plaintiffs alleged that improper cementing practices and well designs had permitted the incursion of extraneous water from nearby formations into the producing formations via the well bore and caused the producing formations to water out prematurely. This was an unprecedented claim, as there had been no prior cases where a court in Louisiana had awarded this type of damage principally because of the problems of proving the existence of damages.

The trial took over ten months to be completed in 2012 and was tried by a single judge. The opinion, which the trial court issued in May 2013, resulted in a finding of no liability on the part of the defendants. The case likely will be appealed, but the opinion of the court represents a major victory for oil and gas operators throughout the state.

The Gulfport trial and appellate team of John A. Scialdone, Todd G. Crawford and John S. Garner successfully navigated the troubled waters of maritime presumptions through the United States District Court for the Eastern District of Louisiana and United States Court of Appeals for the Fifth Circuit. In Mike Hooks Dredging Co. v. Marquette Transportation Co. Gulf-Inland, 716 F.3d 886 (5th Cir. 2013), the Fifth Circuit affirmed the district court’s apportionment of fault of 70% to plaintiff Mike Hooks Dredging Co. as operator of the dredge MIKE HOOKS; 15% to third party defendant Vizier, as operator of a picket boat required to physically assist passing navigation by the dredge under a Corps of Engineers contract; and the remaining 15% fault to Fowler Rodriguez’s client Marquette, as the operator of the PAT MCDANIEL, a tug that allided with the stationary dredge at the intersection of the Intracoastal Waterway near the Wax Lake Outlet in South Central Louisiana.

Mike Hooks claimed our client, Marquette’s, tug boat was solely at fault for striking its moored dredge, relying on the presumption of fault under the Oregon rule that when a moving vessel collides with a stationary object in the water, the moving vessel is presumed at fault and must prove it is not at fault. As the Gulfport trial team developed further evidence through discovery, however, other general maritime law presumptions began to swing in Marquette’s favor. For example, the dredge was required to provide a picket boat to comply with its dredging contract with the U.S. Corps of Engineers. Fowler Rodriguez also uncovered statements taken from Hooks’ employees that showed key dredge personnel knew the picket boat, operated by Vizier, refused to assist “passing vessels in navigation” as expressly required by the Corps contract. Nonetheless, the dredge proceeded to a dangerous location in the Intracoastal Waterway where currents intersect and create difficulty in navigation. Gulfport attorneys presented evidence of two near misses by vessels attempting to pass the dredge: a grounding caused by the heavy current that set the vessel to the southern bank of the intersection, and another collision with the dredge only a few hours before Marquette’s tug attempted to pass.

Fowler Rodriguez successfully rebutted the presumption against Marquette under the Oregon rule by arguing that the dredge violated the narrow channel rule, Inland Rule 9 (“INR9”), codified at 33 CFR § 83.09, which provides: “Avoidance of anchoring in narrow channels: Every vessel shall, if the circumstances of the case permit, avoid anchoring in a narrow channel.” The district court found Marquette had presented sufficient evidence to overcome the adverse presumption of the Oregon rule, agreed that Hooks violated the narrow channel rule and ultimately held that Hooks could not rebut the presumption triggered by the rule of the Pennsylvania, 86 U.S. (19 Wall) 125, 22 L.Ed. 148 (1874), which requires the offending vessel to show the statutory rule violation was “not merely her fault and might not have been one of the causes, or that it probably was not, but that it could not have been.”

The Fifth Circuit affirmed the district court’s apportionment of fault in all respects, but not without some questions on the interplay of these presumptions. The Gulfport appellate team emphasized that the Pennsylvania rule shifts the burden of persuasion to the offending vessel to show that particular statutory violation could not have been the cause of the incident. The Fifth Circuit agreed and wrote, “We agree with the district court that INR 9(g) establishes such a clear legal duty. The regulation expressly prohibits vessels from anchoring in narrow channels, except in exceptional circumstances.”

The Fifth Circuit panel also rejected Hooks’ legal argument that INR 9(g) is inapplicable unless the vessel is first found to be an obstruction. Instead, the panel agreed with the statutory interpretation and analysis offered by Gulfport Appellate Counsel and affirmed the 70% allocation of fault: “INR 9(g) is unambiguous. The rule (“shall…avoid”) expressly prohibits vessels from anchoring in narrow channels, subject only to the exception where circumstances do not permit alternative action.”

Ultimately, the Appellate Court affirmed the District Court’s judgment of liability in all respects. Like the Fifth Circuit opinion, the district court opinion provides useful guidance on navigating the troubled waters created by the presumptions in maritime law.

Fowler Rodriguez attorneys Edward F. LeBreton, III and Stuart Ponder successfully appealed a summary judgment to the United States Fifth Circuit Court of Appeals.

LeBreton and Ponder represented the Board of Commissioners for the Port of New Orleans in litigation against one of its bumbershoot insurers, Insurance Company of North America. The district court granted summary judgment in favor of INA on the basis that lack of notice to one of three severally subscribing insurers relieved all insurers of their obligations under the policy.

On appeal, the Board argued that, because the insurers’ obligations were several, notice to one insurer satisfied the requirement as to that insurer, regardless of possible lack of notice to one of the other insurers. In a per curium opinion, the Fifth Circuit held that any insurer who receives notice is obligated to provide its proportion of the coverage. More specifically, the duty of coverage is triggered for each insurer who receives notice under the policy. The Fifth Circuit remanded the case to the district court for further proceedings. The opinion may be found at Ins. Co. of N. Am. v. Bd. of Comm’rs of the Port of New Orleans, no. 12-30705, 2013 U.S. App. LEXIS 8884, 2013WL 1811892 (5th Cir. La. May 1, 2013).

On June 30, in a unanimous opinion, the Fifth Circuit affirmed most parts of a district court victory on behalf of Hornbeck Offshore Services against the former R&R Marine shipyard in Port Arthur, Texas, and its liability insurer. This will result in a $1.2 million judgment, plus interest, in Hornbeck’s favor. The judgment includes both prejudgment interest and attorneys’ fees. The case arose when Hornbeck’s tug ERIE SERVICE was undergoing major repairs in September 2007 at R&R’s dock . The ship repair facility negligently took insufficient steps to protect the vessel from water ingress from a quickly developing tropical storm. Heavy rain and wave action on Sabine Lake caused the unprotected tug to fill with water and sink.

R&R and its liability insurer refused to pay for the tug’s salvage or for any damages, and the insurer began a declaratory judgment action in Houston to avoid coverage.

In its twenty-page opinion, the Fifth Circuit affirmed the district court’s conclusion that R&R had full custody of the ERIE SERVICE while at its shipyard, but failed to exercise due care and was negligent. The court also affirmed R&R’s liability for all of the time-and-materials salvage charges, noting that even if the salvage company had damaged the tug while trying to raise it, R&R would remain liable because that damage would have been a foreseeable consequence of R&R’s negligence.

Although Texas is not a direct action state, the Fifth Circuit upheld the judgment against R&R’s liability insurer because it had subjected itself to Hornbeck’s compulsory counterclaim by commencing its declaratory judgment action. The Fifth Circuit reduced the judgment to the $1 million policy limit, but rejected the insurer’s argument that the policy limits should be further reduced by the attorneys’ fees it had incurred defending itself. The court reversed the district court’s 18% penalty interest award, but allowed Hornbeck prejudgment interest at 6%, and affirmed a substantial attorneys’ fees award in Hornbeck’s favor.

Stacey Norstrud (Houston) and Skipper Chenault (New Orleans) tried the liability phase of the case, with Tim Strickland (Houston) assisting Norstrud in the damages portion. After opponents appealed the district court’s judgment, Norstrud, Mike Harowski (New Orleans), Toney Rodriguez (New Orleans) and Chenault prepared Hornbeck’s brief, and Chenault argued before the Fifth Circuit. New Orleans paralegal Rachel Ricca was a great help throughout.

National Liability & Fire Insurance v. R & R Marine, No. 10-20767 (5th Cir., June 30, 2014).

New Orleans attorneys A.T. Chenault, Philip Brickman and Susan Keller-Garcia recently prevailed on behalf of Apex Oil Company and Trinidad Corporation on an exception of discharge in bankruptcy on behalf of a vessel owner in a Jones Act suit in the 19th Judicial District Court for East Baton Rouge Parish. The plaintiff alleged that he developed mesothelioma as a result of asbestos exposure on the clients’ vessel in 1966.

Fowler Rodriguez successfully argued that the plaintiff’s claims were discharged by the confirmation of the owner’s Chapter 11 reorganization plan by a Missouri bankruptcy court in 1990. The court’s ruling in the client’s favor directly resulted in a very favorable settlement of the plaintiff’s claims that was well below the plaintiff’s earlier demands.

Houston Mall Defended
Michael W. McCoy, with Allison Hooker, Sherry Weaver, and others, stepped in to defend well-known West Oaks Mall, essentially on the eve of trial. The case involved a personal injury lawsuit as a result of a certified air conditioning/heating specialist being shocked, blown off a ladder, and allegedly and severely injured as a result, while working on the A/C system on behalf of a tenant at West Oaks Mall. The case involved serious factual and legal issues, and resulted in difficult and protracted settlement negotiations after the filing of outstanding defense motions. One day before the final pre-trial conference, and only a few days before the actual trial, a settlement was achieved for less than the total medical lien, and much less than the total medical incurred by the Plaintiff.

Premise Liability Resolved in Favor of Houston Night Club
Very recently, McCoy and his team, including Allison Hooker, were successful in resolving a premises liability case which took place at a well-known nightclub in Houston. McCoy represented the owner of the club, but not the operator. McCoy was successful in demonstrating through documents and through a comprehensive Motion for Summary Judgment that the owner owed few, if any, duties to the particular patron who was severely injured by a bouncer, employed by the club operator, while escorting the Plaintiff out of the club.In fact, the bouncer was charged and pled guilty to felonious assault. However, through outstanding defense motions, it was shown from both a factual and legal standpoint that the owner had little or no liability, and the case settled at mediation for essentially nuisance value, despite a contention of mid-five figures in medical costs, and a prior demand for the $1,000,000.00 policy limit.

Property Damage Case Dismissed
A few weeks later, McCoy was successful in persuading Plaintiff’s counsel to dismiss a lawsuit against an insurance agent, who had placed a trucking policy that did not provide for property damage insurance coverage on behalf of the cab/tractor/trailer rigs, if such tractor/trailers were individually owned by the driver for the trucking company. A particular driver who had her truck stolen had sued, contending that the agent had allegedly misrepresented such coverages. McCoy and his team, including Allison Hooker, were successful through discovery in demonstrating that the Plaintiff driver had no privity with the agent, and that she could not have properly relied on any alleged misrepresentations by the agent, which would have thus, entitled the agent to summary judgment and possible attorney’s fees. McCoy was successful in getting the case dismissed without incurring large defense costs.

In 2004, approximately 824 plaintiffs filed suit in 23 multi-party actions in Mississippi alleging that they had been exposed to asbestos in drilling mud. The lawsuits were aimed primarily at the manufacturers of the asbestos products, including Conoco/Phillips and Union Carbide, as well as many distributors located throughout Mississippi and the Gulf states. Many offshore drilling companies were also named as defendants. Some of these cases were transferred to the multi-district litigation in Pennsylvania, but the vast majority of them settled into two jurisdictions in State Court in Mississippi. ENSCO Offshore Company was named a party defendant in 62 of the 700 cases.

In February 2013, over eight years later, those 62 cases were transferred to Delos Flint and the Fowler Rodriguez Gulfport office. Working with Todd Crawford, Chris Schmidt and Skip Negrotto, Flint was able to evaluate the cases. He settled one that was scheduled for trial immediately and quickly secured dismissals of three others. The Gulfport team then analyzed the medical data and Flint and Crawford came up with a plan to prioritize the claims and began taking the necessary steps to defend them and put them in a posture for Summary Judgment or trial.

In late December 2013, Dee Flint and Todd Crawford traveled to Houston, Texas to meet with plaintiffs’ counsel and reached an agreement to settle the remaining 58 cases on favorable terms. The client, ENSCO Offshore Company, was pleased to get 62 cases that had been pending for nearly ten years resolved and off of their books in less than one year after the cases were transferred to Fowler Rodriguez for handling.

Miami partner, Juan E. Serralles, Esq., recently negotiated franchise and licensing deals for two new South Florida hotels to operate under known hotel brands. Mr. Serralles has long represented South American hotel developers and operators who are focused on penetrating South Florida’s market. The most recent deals have involved negotiating two separate license/franchise deals for “mixed use” deals concerning his client, involving projects with a combination of hotel rooms, condominium units and retail facilities within the respective projects.

Mr. Serralles finalized license agreements with Holiday Hospitality Franchising, LLC, granting permissions for his client to operate a 140-room “Indigo Hotel” in the existing vibrant Brickell West area in Miami’s financial district. The other deal concerning the Sheraton, LLC, also known as ‘Starwood Hotels,’ involved finalizing a license agreement to allow Mr. Serralles’ client to operate an “Aloft Hotel” in the City of Coral Gables downtown area, which will culminate in the construction of a $32 million, 160-room hotel project. Both hotels have commenced construction.