Cunningham v. Offshore Specialty Fabrications

• Citation: 543 F.Supp.2d 614
• Decision Date: 30 January 2008
• Docket Number: Civil Action No. 5:04-CV-282.
• Parties: Danny CUNNINGHAM, et al., Plaintiffs, v. OFFSHORE SPECIALTY FABRICATIONS, INC., et al., Defendants.
• Court: U.S. District Court — Eastern District of Texas

543 F.Supp.2d 614

Danny CUNNINGHAM, et al., Plaintiffs, v. OFFSHORE SPECIALTY FABRICATIONS, INC., et al., Defendants.

Civil Action No. 5:04-CV-282.

United States District Court, E.D. Texas, Texarkana Division.

January 30, 2008.

COPYRIGHT MATERIAL OMITTED

Edward Lewis Hohn, Nix, Patterson & Roach, LLP, Irving, TX, Francis I. Spagnoletti, Spagnoletti & Associates, Houston, TX, Howard W. Foster, Johnson & Bell, Chicago, IL, for Plaintiffs.

Glenn Richard Legge, Laurence Eliot Stuart, Legge, Farrow, Kimmitt, McGrath & Brown, Joseph Everett Leblanc, Jr., Robert P. Vining, King, Leblanc & Bland, Donald J. Horton, William Earl Touchstone, Andrews & Kurth, William P. Maines, Fulbright & Jaworski, Kevin Patrick Walters, Georgantas & Walters, Reginald R. Smith, King & Spalding, Houston, TX, Lisa Brener, Taylor, Wellons, Politz & Duhe, APLC, Mark A. Cunningham, David G. Radlauer, Jones Walker, New Orleans, LA, John Bachman Greer, III, Greer, McCasland & Miller, Robert William Weber, Smith, Weber, LLP, Texarkana, TX, Ralph E. Kraft, Kraft, Gatz, Lane, Benjamin, LLC, Lafayette, LA, Seth Alan Nichamoff, Law Office of Seth Nichamoff, Bellaire, TX, Gregory Scott Combest Huffman, Vernon Goodrich, Nicole Leigh Rittenhouse, William Mayer Katz, Jr. Thompson & Knight, Dallas, TX, for Defendants.

ORDER

DAVID FOLSOM, District Judge.

Currently before the Court are Amended Motion to Dismiss in Response to Plaintiffs Fourth Amended Complaint (Dkt. No. 220) by Global Industries Offshore L.L.C. and Global Industries, Ltd. ("Global Defendants"), Motion to Dismiss Motion to Dismiss Plaintiffs Fourth Amended Complaint (Dkt. No. 221) by Humares BV ("Humares"), Oceanwide Offshore Services ("Oceanwide Offshore"), O.W.I Limited (Oceanwide International) ("O.W.I."), and Oceanwide Houston, Inc.'s ("Oceanwide Houston"), Motion to Dismiss Fourth Amended Complaint (Dkt. No. 222) by J. Ray McDermott, Inc. ("McDermott"), Motion to Dismiss Fourth Amended Complaint (Dkt. No. 223) by Horizon Offshore, Inc., Horizon Offshore Contractors, Inc., and Horizon Vessels, Inc. ("Horizon Defendants"), Motion to Dismiss Fourth Amended Complaint (Dkt. No. 224) by Helix Energy Solutions Group Inc. F/K/A Cal Dive International, Inc. ("Helix"), Motion to Dismiss Plaintiffs Fourth Amended Complaint (Dkt. No. 225) by Offshore Specialty Fabricators, Inc. and Offshore Express, Inc. ("Offshore Defendants"), Motion to Dismiss Complainants' Fourth Amended Complaint and Request for Preliminary and Permanent Injunctions (Dkt. No. 226) by Stolt Offshore, Inc ("Stolt"), and Motion to Dismiss Plaintiffs' Fourth Amended Complaint (Dkt. No. 232) by MAR America, Inc., C-MAR Group Holdings, Inc., C-MAR Group Holdings Limited, and C-MAR Services (UK) Limited ("C-MAR Defendants").

Having considered the briefing and all relevant papers and pleadings, the Court finds that Defendants' motions (Dkt. Nos. 220, 221, 222, 223, 224, 225, and 232) should be DENIED-IN-PART and GRANTED-IN-PART. Stolt's Motion to Dismiss (Dkt. No. 226) shall be GRANTED.

I. Procedural History

Plaintiffs Danny Cunningham, Pablo Rubio Llamas, Jacob Van Dyke, Bernard Coleman, Todd Crews, Raphael Young and Wendell Smith, individually and on behalf of those similarly situated, filed a Third Amended Complaint on August 5, 2005 against Offshore Defendants, Horizon Defendants, McDermott, Stolt, Helix, and Global Defendants, collectively known as "Service Defendants," and also against O.W.I., Oceanwide Offshore, Oceanwide Houston, Humares, and C-MAR Defendants, collectively known as "Manning Defendants." Defendants Third Amended Complaint, Dkt. No. 66 at 1-2.

Plaintiffs define the Service Defendants as "the largest transporters of merchandise in the coastwise trade between points in the United States, and also some of the largest service providers to those prospecting for and developing oil and gas mineral deposits on the Outer Continental Shelf of the United States, including the Gulf of Mexico (the "OCS")." Id. at 13; Fourth Amended Complaint, Dkt. No. 219 at 13-14. Plaintiffs define the Manning Defendants to be "some of the largest providers of crew recruitment and contract labor services to the maritime industry." Dkt. No. 66 at 15-16; Dkt. No. 219 at 15-16. In other words, the Manning Defendants obtain workers for projects and services offered by the Service Defendants.

Plaintiffs brought a class action for "damages caused by the loss of American jobs, the depression of wages, and the loss of benefits to American citizens and aliens lawfully admitted to the United States for permanent residence ("Legal Workers")." Id. at 2. Plaintiffs alleged that the Service Defendants "illegally depress the wages paid to their employees who work on vessels rigs, platforms and other vehicles or structures on the [OCS], by employing large numbers of illegal workers to perform the work of the Service Defendants (the "Illegal Worker Hiring Scheme")." Id.

Thus, Plaintiffs brought a cause of action against the Service Defendants for engaging in the Illegal Worker Hiring Scheme in violation of 18 U.S.C. § 1962(c), the Racketeer Influenced and Corrupt Organizations Act ("RICO"). Dkt. No. 1 at 13-17. Plaintiffs alleged that the Illegal Worker Hiring Scheme violates two provisions of Section 274 of the Immigration and Nationality Act ("INA"), specifically 8 U.S.C. § 1324(a)(1)(A)(iii) and 1324(a) (3)(A). Dkt. No. 1 at 17.

Plaintiffs also alleged that the Service Defendants use the Manning Defendants to staff projects. Id. at 18. Plaintiffs alleged that each Service Defendant has formed an "association-in-fact RICO enterprise consisting of itself and all of the Manning Defendants." Id. Plaintiffs brought causes of action against the Service and Manning Defendants for negligence in creating unsafe work conditions as a result of their hiring practices and violation of the Outer Continental Shelf Lands Act ("OCSLA") 43 U.S.C. § 1331, et seq. Id. at 19-20.

Each of the Service and Manning Defendants brought a motion to dismiss Plaintiffs' Third Amended Complaint. The motions among the Service Defendants were brought by the Offshore Defendants (Dkt. No. 176), the Horizon Defendants (Dkt. No. 174), McDermott (Dkt. No. 178), Stolt (Dkt. No. 180), Helix (Dkt. No. 179), and the Global Defendants (Dkt. No. 177). The motions among the Manning Defendants were brought by O.W.I. (Dkt. No. 172), Oceanwide Houston (Dkt. No. 173), Oceanwide Offshore (Dkt. No. 167), Humares (Dkt. No. 171), and C-MAR Defendants (Dkt. No. 175). The Motion to Dismiss brought by the Horizon Defendants simply adopted the arguments of all the Service and Manning Defendants. Dkt. No. 174 at 1. The arguments brought by the Manning Defendants were identical except for that of the C-MAR Defendants. See Dkt. No. 167, 171-173, and 175.

The Court held a hearing regarding these motions on November 8, 2006. Dkt. No. 194. An issue arose regarding plaintiffs previously employed by Defendant Horizon Offshore, Inc. Dkt. No. 216 at 1. In the Third Amended Complaint, each plaintiff sought to "represent a class of persons ... who were employed by the Service Defendants during the three years prior to the filing of [the] action." Dkt. No. 66 at 3. The Court granted leave of Court to amend the complaint to substitute the Estate of Danny Cunningham. Dkt. No. 217 at 1. Danny Cunningham was previously employed with Offshore Defendants. Dkt. No. 66 at 4. The Court also granted leave to name additional Plaintiffs Ronald Turner, Sr., Brunson Ableson, and Charles Rockward, in place of Bernard Coleman, all of whom worked for the Horizon Defendants. Dkt. No. 217 at 1-2. Plaintiffs, all individually, and on behalf of those similarly situated filed a Fourth Amended Complaint against Service Defendants and Manning Defendants. Fourth Amended Complaint, Dkt. No. 219 at 1-2. Among the Plaintiffs specifically, Danny Cunningham, as represented by Amy Chatagnier, Pablo Rubio Llamas, and Jacob Van Dyke were previously employed by Offshore Defendants; Ronald Turner, Sr. and Charles Rockward were previously employed by Horizon Defendants; Todd Crews was previously employed by McDermott; Raphael Young was previously employed by Helix; and Wendell Smith was previously employed by Global Defendants. Dkt. No. 219 ¶¶ 3.3-3.10. The only Service Defendant that does not have a representative Plaintiff named in the Fourth Amended Complaint is Stolt. See Dkt. No. 219. Moreover, Plaintiffs' RICO claims against Stolt were already dismissed pursuant to a stipulation of dismissal by the Plaintiffs, leaving only the claims for negligence and violation of OCSLA. See Dkt. No. 157 and 160.

In light of the amended complaint, all of the Manning Defendants and all of the Service Defendants, filed motions to dismiss the Fourth Amended Complaint. The Defendants argued that Plaintiffs' Fourth Amended Complaint does not contain substantive differences from the Third Amended Complaint. The primary difference in the complaints was the substitution of certain named plaintiffs. Therefore, the Defendants re-urged or incorporated by reference their prior motions to dismiss the third amended complaint. In particular, among the Manning Defendants, Humares, Oceanwide Offshore, O.W.I., and Oceanwide Houston re-urged and incorporated motions 171, 167, 172, and 173, respectively, as well as their reply to Plaintiffs' response (Dkt. No. 199). Dkt. No. 221 at 2. C-MAR Defendants of the Manning Defendants also incorporated by reference their previous motion to dismiss (Dkt. No. 175) as well as those of other Defendants. Dkt. No. 232 at 2. In MAR Defendants' previous motion to dismiss, C-MAR Defendants noted in particular that it adopted the Renewed Motion to Dismiss Plaintiffs Third Amended Complaint by Helix (Dkt. No. 179). Dkt. No. 175 at 2. Among the Service Defendants: Global Defendants (Dkt. No. 220) re-urged their previous motion to dismiss (Dkt. No. 177), McDermott (Dkt. No. 222) re-urged its previous motion to dismiss (Dkt. No. 178),...