Fogleman v. ARAMCO (Arabian American Oil Co.)
| Decision Date | 04 January 1991 |
| Docket Number | 90-2144,Nos. 89-2995,s. 89-2995 |
| Citation | 920 F.2d 278 |
| Parties | Vernon Isaiah FOGLEMAN and Jean Kenanin Fogleman, Plaintiffs-Appellants Cross-Appellees, v. ARAMCO (ARABIAN AMERICAN OIL COMPANY), Fluor Corporation, et al., Defendants-Appellees Cross-Appellants. Vernon Isaiah FOGLEMAN and Jean Kenanin Fogleman, Plaintiffs-Appellants, v. ARAMCO, Fluor Corporation, Fluor Constructions, Inc., and Fluor Arabia, Limited, Defendants-Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Gregg L. Spyridon, Paul D. Palermo, Hoffman, Sutterfield, Ensenat & Bankston, New Orleans, La., for plaintiffs-appellants, cross-appellees.
Gavin H. McInnis, Antoinette Van Heugten, Haight, Gardner, Poor & Havens, Houston, Tex., for ARAMCO.
Marilyn T. Hebinck, Royston, Rayzor, Vickery & Williams, Houston, Tex., for Fluor Corp., Fluor Constr. & Fluor Arabia, Ltd.
Appeals from the United States District Court for the Southern District of Texas.
Before RUBIN, GARWOOD and HIGGINBOTHAM, Circuit Judges.
The district court correctly decided that Saudi Arabian law applies in a suit for personal injuries sustained on an oil platform off the coast of Saudi Arabia by an United States domiciliary, employed by a Saudi Arabian subsidiary of an United States corporation to work in Saudi Arabia, because all relevant contacts except the domicile of the employee point to Saudi Arabia. We remand to the district court, however, for recalculation of taxable costs.
Fluor Corporation is a Delaware corporation with its principal place of business in California. Among its more than 300 subsidiaries is Fluor Engineers, Inc., later renamed Fluor Daniel, Inc., which is incorporated and has its principal place of business in California. Fluor Daniel owned 70% of Fluor Arabia, Limited, a Saudi Arabian corporation with its principal place of business in Riyadh, Saudi Arabia. The remaining 30% of Fluor Arabia's shares were owned by E.A. Juffali & Bros., a Saudi Arabian general partnership. Fluor Arabia is authorized to do business only in Saudi Arabia.
Vernon I. Fogleman, a Louisiana resident, began to work for Fluor Arabia in Saudi Arabia as a construction and electrical supervisor in May 1976. To apply for his job, Fogleman had completed a "Foreign Employment Application" obtained in Louisiana from a neighbor's son on leave from another company in Saudi Arabia. After the neighbor's son had returned to Saudi Arabia, Fogleman mailed the application to him. A few weeks later, Fogleman received a telephone call from Irvine, California, advising him of a job opening in Saudi Arabia. He therefore proceeded to Saudi Arabia, where, after signing a contract, he worked for Fluor Arabia until 1984 under a series of eight one-year contracts, all signed in Saudi Arabia. The contracts provided that Fogleman had been hired to work exclusively in Saudi Arabia. They contained no choice-of-law provision, but did provide that employee benefits for work-related injuries would be computed on the basis of the California Worker's Compensation Act.
For three years Fogleman worked directly for Fluor Arabia on construction projects for the Arabian American Oil Company (ARAMCO). During the following five years, Fluor Arabia assigned Fogleman to work with ARAMCO as an electrical and construction supervisor pursuant to a "Supplementary Manpower Contract" between the two companies. His final assignment, beginning in June 1983, was to supervise the electrification of an ARAMCO oil platform in the Berri Field, off the coast of Saudi Arabia in the Persian Gulf. During the course of this work Fogleman ate, slept, and maintained an office aboard the workboat M/V AL JUBAIL I. Beginning in August 1983, ARAMCO required Fogleman to work 84 hours per week because the project was behind schedule. On January 24, 1984, while using a swing rope to transfer from the platform to the workboat AL MOJIL VIII, Fogleman sustained a sharp pain in his chest. He was taken to the Abdulla Fouad Hospital for medical treatment, where, upon completion of a stress test, he suffered a heart attack. He was then evacuated on an ARAMCO charter plane to Houston, Texas, where he underwent triple bypass surgery.
Invoking the Jones Act 1 and general maritime law, Fogleman and his wife filed suit against ARAMCO, Fluor Arabia, and other Fluor-related companies, alleging that excessive work demands and inadequate medical treatment had permanently disabled him. After a hearing, the magistrate to whom the district court referred the case recommended that: Fluor Arabia be dismissed due to improper service; other Fluor-related corporations be dismissed; ARAMCO's motions for summary judgment be denied; and the Labor Law of Saudi Arabia be applied in the suit against ARAMCO and Fluor Corporation. The district court adopted the magistrate's recommendations. The parties then filed a stipulation that under the Labor Law of Saudi Arabia, the plaintiffs would not be entitled to any further relief or damages arising from Fogleman's disability. This stipulation contained no reservation of a possible claim against Fluor Arabia under the provision in its contract relating to the California Worker's Compensation Act. The court then entered a final judgment against the Foglemans. A determination by this court that Saudi Arabian law governs this suit would therefore bar any claims against ARAMCO and Fluor Corporation the Foglemans might have pursued under the Jones Act, general maritime law, or the California Worker's Compensation Act.
We review de novo a district court's choice-of-law determination. 2 Whether federal maritime law or foreign law should govern a maritime tort depends on an assessment of eight factors articulated by the Supreme Court in Lauritzen v. Larsen 3 and Hellenic Lines, Ltd. v. Rhoditis. 4 These factors are: 1) the place of the wrongful act; 2) the law of the flag; 3) the allegiance or domicile of the injured worker; 4) the allegiance of the defendant shipowner; 5) the place of the contract; 6) the inaccessibility of the foreign forum; 7) the law of the forum; and 8) the shipowner's base of operations. 5 The test is not a mechanical one in which the court simply counts the relevant contacts; instead, the significance of each factor must be considered within the particular context of the claim and the national interest that might be served by the application of United States law, particularly the Jones Act. 6 Moreover, the significance of each factor in a nontraditional maritime context like offshore oil production may vary from that in the traditional shipping context in which the Lauritzen-Rhoditis test arose. 7
The place of the wrongful act is accorded little weight in traditional maritime cases, in which the locality of the ship changes constantly. 8 When the injury stems from work on a permanently situated offshore oil rig or work platform, however, the place of the wrong assumes greater importance. 9 Fogleman was injured while transferring from a permanent oil platform to a workboat off the coast of Saudi Arabia.
The law of the flag has traditionally been of cardinal importance in determining the law applicable to maritime cases. 10 The vessels on which Fogleman worked and lived, the AL MOJIL VIII and the AL JUBAIL I, sailed under the flags of Panama and Saudi Arabia respectively.
At all relevant times, Fogleman was domiciled in the United States.
Both the AL JUBAIL I and the AL MOJIL VIII are owned by the Al-Mojil Establishment of Dammam, Saudi Arabia. Since this is not a traditional shipping case, however, Fogleman's alleged employers--and therefore the defendants in this case--are Fluor Arabia and ARAMCO, rather than the shipowners. Fluor Arabia is a Saudi Arabian corporation with its principal place of business in Riyadh, Saudi Arabia. Although previously headquartered in Houston, Texas, ARAMCO is a Delaware corporation with its principal place of business in Dhahran, Saudi Arabia. ARAMCO maintains an office in Washington, D.C. but transacts no business in the United States. In 1980, the Saudi Arabian government acquired beneficial title to ARAMCO's assets. 11
The place of the contract, of little import due to its "fortuitous" occurrence for the traditional seaman, 12 becomes a substantial factor in nontraditional maritime employment aboard a vessel more or less permanently located off the coast of a particular country. 13 Fogleman signed all of his eight successive contracts in Saudi Arabia.
As the Supreme Court noted in Lauritzen, this factor is relevant only to a forum non conveniens determination, not to a choice-of-law analysis. 14
In Lauritzen, the Supreme Court rejected the argument that an American forum should simply apply its own law to a maritime tort, since this would in effect reduce the choice-of-law determination to no more than a personal jurisdiction inquiry. 15 While the law of the forum factor is therefore given little weight in determining choice of law, 16 we are nevertheless obliged to correct the district court's misapprehension that this factor requires an evaluation of the adequacy of the foreign forum's law. Although we can attribute the district court's misunderstanding to ambiguity in one of our previous opinions, 17 the law-of-the-forum factor in the Lauritzen analysis is patently United States, rather than foreign, law.
Nor is the law of the forum automatically "inapplicable when [the] defendant was involuntarily made a party," 18 as some of our previous opinions have stated in dicta. We originally made this statement in the context of assessing personal jurisdiction. 19 It was subsequently inadvertently transposed to the choice-of-law context. 20 Very rarely, after all, is a defendant a voluntary party to any...
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