Keeled Hulls Split At Sea – The Fraught Waters Of General Maritime Law Punitive Damages, Split Among The Circuits

by Baker Donelson
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Steady, helmsman! Steady. This is the sort of weather when brave hearts snap ashore, and keeled hulls split at sea. Moby Dick, Herman Melville, Chap. XL

Since the Supreme Court’s (Justice Thomas’s) landmark decision in Atlantic Sounding Co. v. Townsend, 557 U.S. 404 (2009) holding that punitive damages are available in a seaman’s general maritime law (GML) cause of action for willful failure to pay maintenance and cure, several pitched battles have been raging around the country on an issue expressly left unanswered in Townsend (see 557 U.S. at 424, n.11): whether punitive damages are recoverable by a seaman in the separate and independent GML cause of action for unseaworthiness.

The practical importance of this issue in the wake of Townsend has been one of leverage: maritime personal injury plaintiffs routinely began to include punitive damage claims in their petitions/complaints, usually linked to an unseaworthiness or GML negligence claim, ostensibly as a bargaining chip in settlement/case-valuation negotiations.

However, these newly minted claims seemed to fly in the face of the prior, longstanding (albeit controversial) Supreme Court decision in Miles v. Apex Marine Corp., 498 U.S. 19 (1990) barring recovery of non-pecuniary damages in GML claims (at least in the specific context of a seaman’s wrongful death). Under Miles – and until Townsend – the majority of courts (including the Fifth Circuit en banc) had held that the “non-pecuniary” damages barred under Miles included punitive damages. See, e.g., Guevara v. Maritime Overseas Corporation, 59 F.3d 1496 (5th Cir.1995) (en banc).

Townsend, however, abrogated Guevara, which had denied punitive damages specifically in the GML maintenance and cure context and more broadly for GML causes of action generally (pursuant to Miles), thereby calling into question the remainder of Guevara’s general holding barring punitive damages for all GML claims. Thus, Townsend – at least in the minds of forward-thinking plaintiffs – had potentially upended decades of largely consistent rulings in the Fifth Circuit and beyond (including the First and Sixth Circuits, see Miller v. American President Lines, Ltd., 989 F.2d 1450, 1457 (6th Cir.1993) Horsley v. Mobil Oil Corp., 15 F.3d 200, 203 (1st Cir. 1994).

Defendants unsurprisingly wasted no time in their responsive efforts to cut off this new leverage point by filing threshold motions to dismiss seamen’s GML unseaworthiness punitive damage claims as a matter of law under the Guevara/Miles analysis that includes punitive damages among the non-pecuniary damages that seaman are barred from recovering. In short, the Townsend decision and its implications for more expansive punitive damage claims by seamen led to “the sort of weather when brave hearts snap ashore,” and became a hot-button topic nationwide among commentators (including this blog) and courts alike.

The initial battle was pitched in the Fifth Circuit, and ultimately led to the en banc (but splintered, arguably plurality) holding in McBride v. Estis Well Serv., L.L.C., 768 F.3d 382 (5th Cir. 2014) that seaman cannot recover punitive damages in a GML unseaworthiness cause of action. After the en banc ruling, the plaintiffs filed a writ of certiorari to the United States Supreme Court, but the writ was denied (see 135 S.Ct. 2310 (May 18, 2015)) and the McBride case was remanded to the district court for trial. Then again after the trial on the merits, and after an intermediate appeal to the Fifth Circuit on various other trial rulings, the plaintiffs filed a second writ of certiorari (in September 2017) sub nom. Touchet v. Estis Well Servs., LLC, to once again challenge (inter alia) the punitive damage issue before the Supreme Court.

In the meantime, however, the same fight was playing out in the state courts of Washington, with an ultimately diametrically opposed outcome. Around the same time the McBride plaintiffs were back in the Fifth Circuit ahead of filing their second writ of certiorari, the Washington Supreme Court held in Tabingo v. Am. Triumph LLC, that “[seaman] plaintiffs may recover punitive damages for unseaworthiness claims” – specifically rejecting and disagreeing with the Fifth Circuit’s en banc opinion in McBride and even going so far as to characterize McBride as a mere “plurality” opinion. 391 P.3d 434, 440 (Wash. 2017).   And given this 180º about-face by the Washington Supreme Court, the defendants in Tabingo dutifully filed their own writ of certiorari to the United States Supreme Court (within weeks of the McBride writ filing) on the basis of the lower-court (albeit state/federal circuit as opposed to inter-federal-circuit) split on the recoverability of punitive damages for a GML unseaworthiness cause of action.

Thus, the stage appeared to be set for a Supreme Court resolution of two unequivocally mutually exclusive and antithetical lines of jurisprudence developing in the wake of Townsend. However, it was not to be; the Supreme Court denied both the McBride and Tabingo writs on the same date of January 8, 2018. This ostensibly calmed the waves of controversy, but left things precariously as they had been, with seaman plaintiffs free to test the viability of punitive damage claims for unseaworthiness anywhere besides the Fifth Circuit (and presumably the First and Sixth), where they would remain unequivocally barred (absent a potential gambit argument that McBride was some kind of non-binding plurality opinion).

Then, however, in a serendipitous twist of fate, and a mere two weeks after the Supreme Court denied both writs notwithstanding the state/federal circuit split between McBride and Tabingo, yet another case that had been simultaneously winding its way through the federal courts once again blew up “the weather when brave hearts snap” and this time “caused keeled hulls [to] split at sea.” A Ninth Circuit three-judge panel in Batterton v. Dutra Grp., refused to follow what it described as the “sharply divided Fifth Circuit en banc decision” in McBride and instead held that seaman can claim punitive damages in a GML unseaworthiness cause of action:

McBride has five extensive and scholarly opinions addressing all sides of the question. Six dissenters note that Miles “addressed the availability of loss of society damages to non-seamen under general maritime law, not punitive damages,” and that “Townsend announced the default rule that punitive damages are available for actions under the general maritime law (such as unseaworthiness).”… The Fifth Circuit’s leading opinions in McBride are scholarly and carefully reasoned, but so are the dissenting opinions, which to us are more persuasive.

880 F.3d 1089, 1092, 1095 (9th Cir. 2018). Moreover, the Batterton Court rejected the premise underpinning the Fifth Circuit’s historic (under Guevara) holding that punitive damages were barred as “non-pecuniary” under the Supreme Court’s decision in Miles by concluding that punitive damages are neither pecuniary nor non-pecuniary, such that Miles is irrelevant:

[T]he purposes of punitive damages, punishment and deterrence, apply equally to both of these general maritime causes of action [viz. failure to pay maintenance & cure and unseaworthiness]. Nor are punitive damages compensation for a pecuniary or non-pecuniary “loss,” as described in Miles. They are not compensation for loss at all. One might argue for or against the desirability of punitive damages, but unless Congress legislates on the matter, their availability is clearly established not only in Townsend [et al.].

Id. at 1096.

Thus, with “keeled hulls split” in a bona fide, black-and-white circuit split between the Ninth and Fifth (as well as First and Sixth) circuits, it would appear that another writ of certiorari – which will be the fourth to come before the Supreme Court on the same exact issue of whether punitive damages are recoverable for a GML unseaworthiness claim – is inevitable.

Whether the High Court is ultimately keelhauled into taking up the issue it has three times avoided to date remains to be seen. But, with a true multi-circuit split now in play, the odds are certainly more likely than the normal low-single-digit percentage chance (on certiorari) that the Supreme Court will in fact take up the issue in the event the defendants in Batterton seek certiorari.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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