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Cedric K. Kahue v. Pacific Environmental Corporation

November 29, 2011

CEDRIC K. KAHUE,
PLAINTIFF,
v.
PACIFIC ENVIRONMENTAL CORPORATION, ET AL., DEFENDANT.



The opinion of the court was delivered by: Leslie E. Kobayashi United States District Judge

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION FOR SUMMARY JUDGMENT; AND (2) DENYING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT ON COMPLAINT IN INTERVENTION

Before the Court are the following motions: (1) Defendants Pacific Environmental Corporation, M/V PENCO 1, and M/V PENCO 2's (collectively "Defendants" or "PENCO") Motion for Summary Judgment ("Motion"), filed on July 19, 2011; and (2) PENCO's Motion for Summary Judgment on Complaint in Intervention ("Motion on Complaint in Intervention"), filed on August 3, 2011. Plaintiff Cedric Kahue ("Plaintiff" or "Kahue") filed his memorandum in opposition to the Motion on October 12, 2011, and PENCO filed its reply on October 19, 2011. Intervenor Commerce and Industry Insurance Company ("Intervenor" or "CIIC") filed its memorandum in opposition to the Motion on Complaint in Intervention on October 12, 2011, and PENCO filed its reply on October 19, 2011. These matters came on for hearing on October 31, 2011. Appearing on behalf of PENCO was Richard Wootton, Esq., appearing on behalf of Plaintiff were Cory Birnberg, Esq., Collin Marty Fritz, Esq., and Allen Williams, Esq., and appearing on behalf of Intervenor was Lynn Krieger, Esq. After careful consideration of the motions, supporting and opposing memoranda, and the arguments of counsel, PENCO's Motion is HEREBY GRANTED IN PART and DENIED IN PART -- the Motion is GRANTED as to Plaintiff's Count II claim for unseaworthiness and DENIED in all other respects -- and PENCO's Motion on Complaint in Intervention is DENIED for the reasons set forth below.

BACKGROUND

On January 1, 2010, Plaintiff filed a Complaint against Defendants, seeking recovery under the Jones Act, 46 U.S.C. § 30104, for injuries incurred while employed as a seaman by Defendants. He alleges that, on June 12, 2008, he was injured while preparing for a hazardous waste spill response when a large bale of rags from the second story of a PENCO building fell on his head. As a result, Plaintiff is a partial quadriplegic. [Complaint at ¶¶ 13-14.] Plaintiff alleges claims for: (1) negligence (Count I); (2) unseaworthiness (Count II); and (3) traditional maritime remedies, including maintenance, cure, found, and wages (Count III). [Id. at ¶¶ 17-30.]

On April 13, 2011, Intervenor CIIC filed its First Amended Complaint in Intervention, alleging that it issued an insurance policy to PENCO against claims under the Longshore and Harbor Workers' Compensation Act, 33 U.S.C. § 901 et seq. ("Longshore Act" or "LHWCA"), under which it paid workers' compensation benefits to Plaintiff. [First Amended Complaint in Intervention at ¶ V.] Intervenor alleges that it continues to pay disability compensation and medical expenses for Plaintiff as a result of the June 12, 2008 injury, and that it is subrogated to the rights of PENCO and has a lien against any recovery by Plaintiff in this case. [Id. at ¶ X.]

I. Defendants' Motion

Defendants seek summary judgment on all of Plaintiff's claims on the grounds that Plaintiff may not recover under the Jones Act because he does not qualify for seaman status, and is already receiving lifetime benefits under the Longshore Act. Alternatively, Defendants seek partial summary judgment on Plaintiff's Count II unseaworthiness claim because no vessel was involved, and on their affirmative defense to limit liability to the value of the vessel involved pursuant to 46 U.S.C. § 30501 et seq. [Mem. in Supp. of Motion at 1-2.]

PENCO states that it provides environmental remediation and spill cleanup services, primarily on land, involving hazardous material and oil spill response operations on roads and in warehouses, factories, piers, and shipping containers. [Defendants' Separate and Concise Statement of Facts ("CSF"), Declaration of Teal Cross ("Cross Decl."), at ¶ 2.] PENCO also performs soil remediation, oil pumping and processing facilities excavation, above and underground storage tank removal, and hazardous materials disposal. [Id. at ¶ 3.]

According to Teal Cross, PENCO's Executive Vice President, a small percentage of PENCO's work takes place at sea, including marine spill responses, deploying containment booms around vessels for fueling, and transporting people and equipment to and from jobsites. [Id. at ¶ 4.] PENCO's marine operations are conducted primarily from its Boston Whaler, Radon, and three unpowered skiffs; PENCO employees occasionally work on vessels owned by the Clean Islands Council ("CIC"), a customer of PENCO's, and American Marine Corporation ("AMC"), a separate business entity. [Id. at ¶¶ 7-9; Defendants' CSF, Declaration of Scott Vuillemot ("Vuillemot Decl."), at ¶ 3.]

PENCO states that it hired Plaintiff in 1996 as a laborer, and he later worked as a HAZMAT technician and foreman. [Cross Decl. at ¶ 11.] According to Mr. Cross, the "vast majority of Plaintiff's work with PENCO was on land jobs operating cranes, backhoes, excavators, dozers, boom trucks, loaders, forklifts and pickup trucks." [Id. at ¶ 12.] Plaintiff also worked on or under piers, vessels tied up to piers or in drydock, and on vessels in harbor or at sea. [Id. at ¶¶ 14-16.] His marine work included operating PENCO's skiffs to place oil containment booms around vessels taking on or discharging fuel, transporting passengers and equipment, and occasionally, performing oil spill clean up and training. [Id. at ¶ 18.] Plaintiff also operated and worked aboard skiffs owned and controlled by CIC or AMC's boats. [Id. at ¶ 19.] According to Mr. Cross, during Plaintiff's entire employment with PENCO, he spent 14.82% of his time in the service of PENCO's skiffs away from a dock or underway, 2.72% of his time was on vessels owned by AMC, and 2.18% on CIC's and other company's vessels. [Id. at ¶¶ 23-24.]

Mr. Cross asserts that PENCO is always prepared to respond to land or marine cleanup projects, but that it does not expect its employees to be available for every job arising after normal work hours, and no PENCO employees are on call for service on the skiffs. [Id. at ¶ 25.] He claims that PENCO allowed Plaintiff to live at its shop as an accommodation to him, because, in 2003, Plaintiff was evicted from his apartment and began sleeping at the shop without approval. PENCO purchased a shipping container to be modified as an apartment, which Plaintiff paid for through payroll deductions. This accommodation was not contingent on Plaintiff being available for work at any time after his regular shift ended. That is, when off work, PENCO did not require Plaintiff to be at the pier and he was not paid for time spent there. [Id. at ¶ 26.]

On the date of Plaintiff's injury, Plaintiff was the foreman in charge of mobilizing equipment and supplies at PENCO's shop for a highway spill response job in Honolulu. Plaintiff ordered two co-workers, James Uyehara and Jarvis Kanakaole, to load necessary supplies and equipment into a truck. The supplies were in a storeroom on the second floor of the shop. Kahue testified that he expected his co-workers to carry the supplies down the stairs, while he waited next to the truck. Mr. Uyehara, however, dropped an unopened bale of cleaning rags, weighing forty to fifty pounds, rather than carrying it down. No one was acting as lookout and Mr. Uyehara did not call out a warning. The bale of rags hit Plaintiff on the head. Plaintiff agrees that if proper PENCO procedures for loading supplies were followed, he would not have been hit in the head. [Defendants' CSF, 4/20/11 Deposition of Cedric Kahue ("Kahue Dep."), at 159, 361-376*fn1 .]

A. Plaintiff Was Not a Seaman

Defendants first argue that Plaintiff's Jones Act claim fails because he was a land-based worker, not a seaman. They contend that Jones Act seamen have traditionally been afforded heightened protections not available to land-based maritime workers. [Mem. in Supp. of Motion at 9 (citing Chandris v. Latsis, 515 U.S. 347, 354 (1995)).]

In order to qualify as a seaman, Plaintiff must both:

(1) have an employment related connection to a vessel in navigation on the navigable waters of the United States; and

(2) contribute to the function of the vessel or the accomplishment of its mission. To satisfy the first prong, a seaman must have a connection to a vessel (or group of vessels) that is substantial in terms of both its duration and its nature. [Id. (citing Chandris, 515 U.S. at 354).]

PENCO argues that Plaintiff was not in the service of a vessel at the time of his injury, and spent less than twenty percent of his time on PENCO's marine projects. It argues that, under Chandris, a worker's service to a vessel is determinative of his status as a seaman, and that a seaman must have an enduring relationship with the vessel. Even if Plaintiff could show that he otherwise met the duration requirement, he was working on a land-based job at the time of the accident and was not in service of any vessel. That is, his injury did not arise out of his service to any vessel. [Id. at 10-11.]

Next, PENCO argues that Plaintiff's work does not satisfy the duration element of the substantial connection test, which requires that roughly thirty percent of a worker's time be spent in service of a vessel in navigation. Here, Plaintiff spent only 14.82% of his time in service of PENCO's vessels. The duration element is proper on summary judgment because, "where undisputed facts reveal that a maritime worker has a clearly inadequate temporal connection to vessels in navigation, the court may take the question from the jury by granting summary judgment." [Id. at 14 (quoting Chandris, 515 U.S. at 371).]

PENCO also argues that Plaintiff's unseaworthiness, maintenance, and cure claims fail because he is not a seaman. It notes that unseaworthiness is a form of strict liability unique to maritime law, but that a vessel owner owes a duty only to seamen working aboard its vessel to ensure that it is seaworthy. A seaman is also entitled to recover "maintenance and cure" in the event he is injured in service of a ship; this right is also limited to seamen. Plaintiff is not a seaman, and cannot maintain his claim for unseaworthiness, maintenance, and cure. [Id. at 17.]

B. Partial Summary Judgment on Count II (Unseaworthiness)

Alternatively, PENCO seeks partial summary judgment on Plaintiff's unseaworthiness claim. It argues that Plaintiff was not injured by a vessel, let alone an unseaworthy one. Here, Plaintiff was injured while supervising the loading of a truck with supplies to clean up a roadside oil spill -- there is no vessel that was a substantial factor in causing his injury. PENCO argues that there is no legal or factual basis for Plaintiff's Count II unseaworthiness claim, and that it is entitled to summary judgment on that claim. [Id. at 18.]

C. Partial Summary Judgment as to Limitation of Liability

PENCO also seeks partial summary judgment based on its affirmative defense of limited liability under the Limitation Act. It argues that the Limitation Act's language is very general, permitting limitation for "any act . . . done, occasioned, or incurred, without privity or knowledge of the matter." [Id. at 10 (quoting 46 U.S.C. § 30505).] PENCO asserts that there is no evidence that it had any privity and knowledge that its employees would violate safety procedures, and, barring such evidence, PENCO is entitled to limit its liability under the Limitation Act. [Id.]

II. Plaintiff's Memorandum in Opposition

A. Plaintiff Is a Seaman

In his memorandum in opposition, Plaintiff argues that he is a Jones Act seaman, and that this determination is a mixed question of law and fact, which is for the trier of fact and not appropriate for summary judgment. [Mem. in Opp. to Motion at 2-3.]

Plaintiff argues that, under the Chandris test, the term "seaman" is to be liberally construed. Plaintiff argues that he is a seaman because he meets the following four factors:

(1) he contributed to the function of, or helped accomplish the mission of, a vessel; (2) his contribution was to a particular vessel or identifiable group of vessels; (3) his contribution was substantial in terms of the duration and nature; and (4) his employment regularly exposed him to the hazards of the sea. [Id. at 4-5.]

First, he argues that the definition of "vessel" is broad, and that a vessel need not be out to sea. He argues that all of the vessels he used during his employment at PENCO should be considered in determining seaman status regardless of whether they were in the harbor or the open ocean, including paddleboards, jet skis, skiffs, dinghies, Boston Whalers, Radons, and Livingstons. [Id. at 6.]

Second, Plaintiff argues that his duties contributed to the function of the vessel, and that he need not have aided in navigation. He argues that all "who work at sea in service of the ship" are eligible for seaman status, and that this threshold is very broad. [Id. at 7.]

Third, Plaintiff maintains that he was in service to an identifiable group of vessels, including other entities' vessels. According to Plaintiff, "[i]n service, of course, includes operations of the vessel but the term is much broader than simply being on board and/or operating the vessel. To be in service of a vessel, one is 'answerable to the call of duty.' This would include being on call." [Id. at 9.] He argues that, because PENCO was a "24/7 emergency marine response company," its employees were subject to being called in, especially Plaintiff, as he was living at the facility and "was effectively on duty 24/7 365 days a year." [Id.]

Plaintiff argues that "in service of a vessel, would necessarily include prepping, repairing, and routine maintenance of the vessel." [Id. at 10.] He also states that the requirement is that the employee be in service of the vessel, not actually on the vessel. In Defendants' calculations of the amount of Jones Act time Plaintiff spent, the time considered was incorrectly limited to his time spent on the vessel in the water and away from the dock. Plaintiff urges the Court to consider his time spent in service of all PENCO, CIC, and AMC vessels in determining his seaman status. [Id. at 10-13.]

Fourth, Plaintiff claims that his contribution was substantial in terms of duration and nature. Plaintiff's own statistical analysis of the documents produced indicate more than fifty-five percent of Plaintiff's time was in service of a vessel for the three years prior to his injury. [Id. at 15 (citing Plaintiff's Concise Statement of Facts in Opposition ("CSF"), Declaration of Amy Chan ("Chan Decl."), passim).] Plaintiff also states that "all of the witnesses that have been deposed, that were asked about Plaintiff's work, felt that Plaintiff's time was at least 70% or more on the water." [Id. (citing Plaintiff's CSF, Saito Decl., at ¶¶ 17, 21, 24-26, 29, 31, 32, 46; Uyehara Decl., at ¶¶ 8, 11, 13, 14, 20, 30, 33; Birnberg Decl. ¶¶ 3, 4, 10; Kaumeheiwa Decl. ¶ 5).] Plaintiff argues that Defendants' calculations are deficient and applied an incorrect (and very narrow) interpretation of what constitutes Jones Act work, omitting, for example, all of Plaintiff's time spent prepping, maintaining, and repairing the vessels. Plaintiff's time on call was also not included. There were also numerous discrepancies and errors in Mr. Cross's calculations. Plaintiff argues that his time in service of a vessel is an issue of fact and that summary judgment is not appropriate. [Id. at 16.]

Finally, Plaintiff argues that whether he was exposed to the "perils of the sea" is not determinative of seaman status, but, that, in any event, he was so exposed. Risks encountered by Plaintiff included failing overboard, drowning, and being exposed to dangerous marine life. [Id. at 17-18.]

With respect to the type of job Plaintiff was reporting for on the day of his injury, he claims that there is no basis to claim that Plaintiff would even have gone on the "land based job" that day. Plaintiff testified that he did not know what type of job he was preparing for (rags are used for both land based and marine based jobs). [Id. at 19 (citing Plaintiff's CSF, Declaration of Cedric Kahue ("Kahue Decl."), at ¶ 25).] He argues that the fact that his injury occurred on land does not deprive him of seaman status.

B. Defendants' Insurance Coverage and Seaman Status

Plaintiff next argues that PENCO is a Jones Act Employer, specifically taking out Jones Act insurance to cover its employees, not only in the service of its own vessels, but in the service of its customers' vessels (and the vessels of its sister organization AMC), without reference to a time percentage or assignment to a specific identifiable vessel or group of vessels. He states that PENCO has marine Protection and Indemnity ("P&I") insurance, which specifically includes Jones Act seaman coverage for employees on vessels and other non-PENCO owned vessels. [Id. at 23-24 (citing Plaintiff's CSF, Declaration of Cory Birnberg ("Birnberg Decl."), at ¶¶ 3, 7).] Plaintiff argues that PENCO's insurance coverage is indicative of his seaman status. [Id. at 24-25.]

C. PENCO Is Not a Land-Based Company

According to Plaintiff, PENCO is not simply a land-based company. PENCO's website touts its history and services as marine-based, and, through its insurance coverage, workers' compensation type benefits are being provided to Plaintiff as a "maritime worker" under the Longshore Act. [Id. at 25 (citing Birnberg Decl. ¶ 2 and Exh. A attached thereto (Website print outs)).]

D. Limitation of Liability Is Not Applicable

With respect to PENCO's affirmative defense under the Limitation Act, Plaintiff argues that PENCO's skiffs are excluded under the law. He states that it is applicable "only to seagoing vessels, but does not apply to pleasure yachts, tugs, towboats, towing vessels, tank vessels, fishing vessels, fish tender vessels, canal boats, scows, car floats, barges, lighters, or nondescript vessels." [Id. at 26 (quoting 46 U.S.C. §30506(a)) (emphasis Plaintiff's).]

Plaintiff argues that a vessel owner cannot limit liability if the unseaworthy condition or negligent act was within its privity and knowledge. He states that Justin Souza, supervisor, on site, informed Plaintiff to get ready for a spill. [Id. at 27 (citing Defendants' CSF ¶ 28).] If the vessel owner or management is on the vessel, knowledge is presumed as it is something they knew or should have known. Plaintiff asserts that 46 U.S.C. §§ 30505 and 30506 state that a ship owner may limit liability for actions arising from personal injury or death only if the ship owner did not have privity or knowledge of the negligence or unseaworthiness responsible for the loss. Supervisors and Vice President Justin Souza and Dave Carter were present at the time of the Plaintiff's injury. Ruben Sabog and Jacob Darakjaian were Plaintiff's supervisors and present and instructing Plaintiff as to the emergency response. The report of injury specifically says management was at fault for the accident and caused Plaintiff to hurry. [Id. at 28 (citing Birnberg Decl., at ¶ 16 and Exh. N attached thereto (Cross Dep. 82:15-16)).] Plaintiff argues that limitation is not allowed or is a triable issue of fact as to Defendants' privity and knowledge.

E. Defendants Are Answerable for Unseaworthiness

With respect to Count II, Plaintiff argues that "it is a settled rule than a seaman who is not equal in disposition and seamanship to the ordinary men in the calling makes the vessel unseaworthy and visits liability on the ship or her owner." [Id. at 29.] In this case, Plaintiff argues that Mr. Uyehara, the person who threw the bag of rags on Plaintiff's head, was not fit to be a seaman. "No one throws a heavy bundle from a second story without looking or having appropriate safety rules." [Id.] Further, PENCO failed to have proper safety rules for its vessels, its loading and unloading equipment, and supplies for its vessels were stored in the second story mezzanine. He argues that Mr. Uyehara did not have the proper training and the rules for him were not defined. Thus, Defendants are liable for his unseaworthiness. [Id. (citing Scindia Steam Navigation Co. v. Moon Engineering Co., 379 F.2d 928 (3rd. Cir. 1967) ("a supervisor must not assume that a safe condition exists when he has notice that such may not be the case")).]

III. Defendants' Reply

Defendants argue in reply that Plaintiff was not in service of a vessel, was not a seaman, and that ...


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