In 2014, the United States Fifth Circuit Court of Appeals sitting en banc held in McBride v. Estis Well Service that injured Jones Act seamen cannot recover punitive damages for their vessel owner/employer’s breach of its general maritime law duty to provide a seaworthy vessel. Earlier this year the United States Ninth Circuit Court of Appeals expressly disagreed with the Fifth Circuit on this issue in Batterton v. Dutra Group and found that punitive damages can be awarded to Jones Act seamen for their own injuries in general maritime law unseaworthiness claims.
The vessel owner in Batterton recognized the Ninth Circuit had already allowed punitive damages for general maritime law unseaworthiness but argued the earlier decision had been overruled by the United States Supreme Court in Miles v. Apex Marine Corp., which the McBride court found controls the issue and supports prohibiting such claims. The Ninth Circuit held otherwise, and the vessel owner recently filed a petition for a writ of certiorari of the decision to the Supreme Court.
The disagreement mainly arises from the difference in the circuit courts’ interpretations of the Supreme Court’s prior decisions in Miles v. Apex Marine Corp. and Atlantic Sounding Co. v. Townsend. Although the Supreme Court only grants writs in a very small number of cases, the Supreme Court may consider doing so to resolve the split in authority between the Fifth and Ninth Circuits.
This issue is extremely important to vessel/drilling rig operators in the marine and energy industries as this decision will either limit or expand vessel owners/employers’ exposure. Additionally, any decision will impact the significant litigation risk that punitive damages pose to marine and energy companies, since punitive damages are typically excluded from insurance coverage.
The Phelps Dunbar Marine and Energy Team will keep readers updated on this matter through the Marine and Energy News Alert.