Gabarick v. Laurin Mar. (Am.), Inc.

• Decision Date: 28 September 2012
• Docket Number: 08–4156,08–4046,Civil Action Nos. 08–4007,08–4023,08–4261,08–4600.
• Citation: 900 F.Supp.2d 669
• Parties: Stephen Marshall GABARICK and Bernard Attridge On Behalf of Themselves and All Others Similarly Situated v. LAURIN MARITIME (AMERICA), INC.; Whitefin Shipping Co., Ltd.; D.R.D. Towing Company, LLC; American Commercial Lines, Inc.; and The New Orleans–Baton Rouge Steamship Pilots Association.
• Court: U.S. District Court — Eastern District of Louisiana

900 F.Supp.2d 669

Stephen Marshall GABARICK and Bernard Attridge On Behalf of Themselves and All Others Similarly Situated

v.LAURIN MARITIME (AMERICA), INC.; Whitefin Shipping Co., Ltd.; D.R.D. Towing Company, LLC; American Commercial Lines, Inc.; and The New Orleans–Baton Rouge Steamship Pilots Association.

Civil Action Nos. 08–4007, 08–4156, 08–4023, 08–4046, 08–4261, 08–4600.

United States District Court,

E.D. Louisiana.

Sept. 28, 2012.

Camilo Kossy Salas, III, Salas & Co., LC, Stevan C. Dittman, Gainsburgh, Benjamin, David, Meunier & Warshauer, New Orleans, LA, Daniel E. Becnel, Jr., Darryl James Becnel, Kevin Patrick Klibert, Matthew B. Moreland, Becnel Law Firm, LLC, Reserve, LA, for Stephen Marshall Gabarick and Bernard Attridge On Behalf of Themselves and All Others Similarly Situated.

Glenn A. Goodier, Richard D. Bertram, Jones, Walker, New Orleans, LA, John A. Nicoletti, Terry L. Stoltz, Nicoletti, Hornig & Sweeney, New York, NY, for American Commercial Lines, Inc.

Randy Waits, John Emmett, Waits, Emmett, and Popp, New Orleans, LA, for DRD Towing Co., Inc.

Hugh Ramsay Straub, David B. Lawton, Michael M. Butterworth, Raymond T. Waid, Phelps Dunbar LLP, New Orleans, LA, for Laurin Maritime (Americas) Inc., Laurin Maritime AB, Whitefin Shipping Co., Ltd., and Anglo-Atlantic Steamship Limited.

Hilary G. Gaudin, Priscilla M. Schwartz, Gaudin & Gaudin, for John Bavaret.

OPINION

IVAN L.R. LEMELLE, District Judge.

This litigation involves complicated fact pattens and interwoven legal issues. It begins with a series of vessel chartering agreements by American Commercial Lines, Inc. (“ACL”) and D.R.D. Towing Company, LLC (“DRD”)—an arrangement described by ACL as a “two step, two contract process”. Record Document Number 1381, p. 55. The pertinent arrangement involves charter for the M/V MEL OLIVER (“MEL OLIVER”). In another vein, we are presented with numerous contracting and operational arrangements involving Whitefin Shipping Co., Ltd., Laurin Maritime AB, Laurin Maritime (America) Inc., Anglo–Atlantic Steamship Limited, and the M/V TINTOMARA (“TINTOMARA” interests). Record Document Number 1383, pp. 38–43. The collision between the ACL owned barge DM–932, under tow by the MEL OLIVER, with the M/V TINTOMARA resulted in the sinking of that fuel oil laden barge, damages to the TINTOMARA, and various other claims between aforementioned parties, the tugs crew and third parties. Prior to this vessel limitations trial, collateral federal criminal proceedings were filed against the tug operator and owner/managers of the tug, which resulted in convictions by guilty pleas from those parties. Administrative proceedings were also held pursuant to Coast Guard and Oil Pollution Act regulations.

In its two-step with DRD, ACL contracted its tug PAM D, later substituted with the MEL OLIVER, to DRD for a specified time period. DRD paid a charter rate for the vessel of $1.00 per day provided the vessel was, in the second step, simultaneously chartered back to ACL by DRD to work exclusively in ACL's service at a higher daily or market based rate. Jim Masters, T.Tr. Vol. IX (AM), pp. 32–37, D. Dantin T.Tr. Vol. VI (AM), p. 103; Exhs. 700–702, inclusive. Because of a shortage of licensed personnel to operate its tugs and to achieve economics savings, ACL contracted with DRD to operate ACL owned tugs—including the PAM D and the substituted MEL OLIVER. Sellers, T. Tr. Vol. VII (AM), p. 105; Christy, T.Tr. Vol. VII (PM), p. 39; Tr. Exh. 702. This two-step produced a pair of ACL drafted documents entitled “Bareboat Charter”, Exhibit 252, and “Fully Found Charter”, Exhibit 253. See also, D. Dantin T.Tr. Vol. XI (AM), pp. 101–02; Tr. Exhs. 700, 701 and 702.

Bareboat charters are created when “the owner of the vessel completely and exclusively relinguish[es] possession, command, and navigation” of the vessel to another, called the demisee or charterer. Guzman v. Pichirilo, 369 U.S. 698, 699–700, 82 S.Ct. 1095, 8 L.Ed.2d 205 (1962). Courts are to “look through the form of the transaction to its substance to determine whether an agreement for the use of a vessel constitutes a bareboat charter or some other relationship”. Loose v. Offshore Nav., Inc., 670 F.2d 493, 498 n. 8 (5th Cir.1982). While standing in the shoes of the vessel owner, a “bareboat charterer is responsible for managing and maintaining the vessel, with the vessel owner merely retaining a right of reversion.” Bosnor, S.A. de C.V. v. Tug L.A. Barrios, 796 F.2d 776, 783 (5th Cir.1986).

The subject bareboat charter required DRD to comply with all laws and regulations with respect to licensing, use, manning, maintenance and operations of the vessels and procure all registrations, certificates and permits for operational purposes. The bareboat charter's exhibit A sets forth how the parties were to allocate certain costs based upon the age or number of hours on a piece of equipment. While the bareboat charter contained a provision as to where repairs were to be undertaken, ACL in practice allowed DRD to select the repair yard. The two charter agreements had a three year duration period with a one year option, subject to a 30–day written notice in advance of termination. Exhs. 700–01. DRD had to provide vessel hull insurance, bear risk of loss of the vessel, waive its right to limitation of liability and treat and maintain the vessel as if it were owned by DRD. R. Dantin Depo. p. 49; Carner, T.Tr. II (PM), p. 173.

Simultaneously with execution of the bareboat charter, DRD executed the document entitled “Fully Found Charter”, also known as the time charter. The time charter required DRD, by virtue of its position as bareboat charterer, to charter the vessel back to ACL for a particular time period, noted earlier, with performance standards and operating responsibilities, Exhs. B & C to the “Fully Found Charter”, Exhibit 701. The incorporated standards called for DRD to crew the vessel with a properly licensed and trained wheelman and a properly trained deckhand per each 12–hour watch, with vessel operations to be on a 24–hour, 365 day schedule. Daily logs of vessel activities were prepared by DRD and transmitted to ACL. DRD was also required to maintain the vessel, including its navigational equipment, prepare reports of incidents involving the vessel and its equipment, fully store the vessel for cleaning and crew consumables, supply all engine room consumables, make all repairs other than underwater, provide for crew travel and training, and twice annual 100 Point Inspections. As in the bareboat charter, the time charter contains language that the members of the crew are employees of DRD, with no responsibility by ACL over the vessel crews. Tr. Exhibits 700, p. 5 and 701, p. 7, respectively. Unless noted otherwise, it bears repeating that references to “vessel”, “tug” and “crew” pertain to the MEL OLIVER, which, again, served as the temporary replacement vessel for the PAM D—with all terms and conditions unchanged and in effect according to the PAM D's two step charter documents and letter addendums. Tr. Exh. 702, Vol. 12.

To rebutt DRD's status as owner pro hac vice and establish that ACL maintained operational control over the vessel and crew, the TINTOMARA interests point to evidence that ACL “offered” instructions on how to tie up vessels at certain facilities and other vessel instructions (Rec. Doc. 1380, p. 40, Tr. Exh. 203; Sellers, T.Tr. Vol. VII, pp. 24–29); paid for fuel and lube (noted earlier); “offered” specific safety directives as to the type of personal protective gear (life vests) to be used by crews in ACL's Harahan fleet of vessels (Rec. Doc. 1380, p. 40; D. Dantin, T.Tr. Vol. VI, pp. 17 and 127; Exhs. 130 and 206); could “request” DRD to remove DRD crew from ACL vessels (Rec. Doc. 1380, pp. 40–41; D. Dantin, T.Tr. Vol. VI, p. 126; Sikor, T.Tr. Vol. VIII, p. 91); approved major repair work, location for that work and maintained all electronics on the vessels (Jenkins, T.Tr. Vol. VI, pp. 60–64; Exh. 252; pp. 6–7; D. Danti, T.Tr. Vol. VI, p. 116; Warner depo., p. 24); required DRD principal owners to be part of ACL's hurricane preparedness program (Munoz, T.Tr. Vol. IX, pp. 63–66); directed DRD to retain or paint ACL's logo on the vessel (D. Dantin, T.Tr. Vol. VI, p. 127); could terminate the charters with DRD unilaterally (D. Dantin, T.Tr. Vol. VI, p. 109; Whitlock depo., p. 54–65); and ACL did not allow DRD to earn a profit or freight without ACL's permission (Tr. Exhs. 252, p. 7, 253, pp. 5, 6, 7 and 12; D. Dantin, T. Tr. Vol. III, pp. 124–125).

The docking instructions were merely instructions that ACL received from its customers that were in turn transmitted by ACL to DRD operated vessels. Tr. Exh. 203. Even if the docking facilities were owned by ACL, simply directing the manner in which it wanted vessels to tie up to its facilities would not, standing alone, destroy DRD's responsibilities for vessel navigation and management. To hold otherwise would lead to absurd results in the maritime industry. Similarly, the conduct of ACL in dispatching information to DRD about where to pick up and transport barges fails to invalidate the subject chartering arrangements or establish vessel operational control by ACL. DRD contracted with ACL to perform towing operations of ACL's barges. ACL needed DRD's towing services in order to satisfy the transportation needs of ACL's customers. Credible evidence establishes that dispatching DRD to perform those services for the benefit of ACL and its customers did not take operational control of the tugs away from DRD. D. Dantin, T.Tr. Vol. VI, pp. 6–7; R. Dantin, depo., pp. 39–40; Corner, T.Tr. Vol. II, pp. 15–3–154; Sellers, T.Tr. Vol. VII, p. 80; Christy, T.Tr. Vol. VII, pp. 86–87. The act of dispatching DRD to a locality was done in ACL's capacity as time charterer, with DRD personnel commanding, navigating and performing the dispatched assignment as owner pro hac vice of the tug under the bareboat and time...