Huseman v. Icicle Seafoods, Inc.

• Decision Date: 27 December 2006
• Docket Number: No. 04-35655.,04-35655.
• Citation: 471 F.3d 1116
• Court: U.S. Court of Appeals — Ninth Circuit
• Parties: Lanny M. HUSEMAN, Plaintiff-Appellant, v. ICICLE SEAFOODS, INC., a Washington corporation; F/V DISCOVERY STAR, Official No. 500072, her engines, tackle, furniture, apparel and equipment, In Rem, Defendants-Appellees.

471 F.3d 1116

Lanny M. HUSEMAN, Plaintiff-Appellant, v. ICICLE SEAFOODS, INC., a Washington corporation; F/V DISCOVERY STAR, Official No. 500072, her engines, tackle, furniture, apparel and equipment, In Rem, Defendants-Appellees.

No. 04-35655.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted May 3, 2006.

Filed December 27, 2006.

Eric Dickman, Injury at Sea, Seattle, WA, for the appellant.

Philip W. Sanford and Daniel S. Potts, Holmes Weddle & Barcott, Seattle, WA, for the appellees.

Appeal from the United States District Court for the Western District of Washington Robert S. Lasnik, District Judge, Presiding. D.C. No. CV-03-02786-RSL.

Before REINHARDT, McKEOWN, and CLIFTON, Circuit Judges.

Opinion by Judge McKeown; Dissent by Judge Reinhardt

McKEOWN, Circuit Judge.

Lanny Huseman appeals the district court's decision on summary judgment that his Jones Act, 46 App. U.S.C. § 688, and unseaworthiness claims against Icicle Seafoods, Inc. ("Icicle") were time-barred and that his maintenance and cure claim was barred by laches. As to the Jones Act and unseaworthiness claims, Huseman does not dispute that his filing was untimely and beyond the three year limitations period. Instead, he argues that he should be allowed to proceed under the theories of equitable tolling or equitable estoppel.

Given the circumstances of this case, Huseman cannot establish the requirements for either equitable tolling or equitable estoppel. Huseman asks us to fashion, under the "wards of the court" doctrine for seamen, a broad fiduciary duty that would require employers, like Icicle, to affirmatively disclose and explain federal causes of action, including Jones Act and unseaworthiness claims, to their employees. We are mindful of the special remedies and protections reserved for seamen because of the perils of the sea and the hard conditions of their labor; we decline however, to embrace such an unprecedented extension of the "wards of the court" doctrine. Although ship owners owe a duty "to act in good faith and to deal fairly in performing and enforcing ... contract[s]," Flores v. Am. Seafoods Co., 335 F.3d 904, 913 (9th Cir. 2003), these duties do not extend so far as to render ship owners legal advisors to their employees in all contexts. Compare Orsini v. O.S. Seabrooke O.N., 247 F.3d 953, 964 (9th Cir.2001) (shipowner is required to provide legal advice regarding the seaman's rights before seaman may sign a release of those rights).

As to the maintenance and cure claim, we agree with Huseman that the district court erred in its laches determination. Huseman filed suit within a month after learning of his potential claim and less than six months after the three year limitations period for the other claims expired. The district court did not, as required by our case law, make specific findings of prejudice to support the laches bar and did not balance any prejudice against the short duration of the delay and Huseman's justification.

We therefore affirm the district court's dismissal of Huseman's Jones Act and unseaworthiness claims, and reverse and remand on his maintenance and cure claim. This result does not, as the dissent suggests, leave the seaman devoid of legal redress, nor does it foreclose the invocation of equitable estoppel or equitable tolling in the appropriate case. See Thorman v. Am. Seafoods Co., 421 F.3d 1090, 1096 (9th Cir.2005).

BACKGROUND

Sometime in March or April of 2000, Huseman injured his shoulder while working for Icicle aboard the Discovery Star. At the time of his hire as a seafood processor, Huseman received a document entitled "Terms of Employment," which included the following clause informing him about potential maritime benefits:

If you are injured while working on the floating processor, it may be covered under Alaska Worker's [sic] Compensation and/or under Federal Maritime benefits. Unless requested otherwise, we will process any claim through the Alaska Workers' Compensation system and coordinate any additional benefits that may be due under Federal Maritime Law; however, you may request at any time to opt out of the Alaska Worker's Compensation system in favor of Federal benefits.

After learning of Huseman's injury, Icicle filed an Alaska Workers' Compensation Report with the Alaska Department of Labor, as required by Alaska law. See Alaska Stat. § 23.30.070 (1970). The Alaska Department of Labor then sent Huseman an explanatory pamphlet, which Huseman remembers receiving and reading. The pamphlet explains coverage and invites questions, stating that "[n]early all Alaska employees are covered. Commercial fishers are an exception, but some fish processor workers on floating processing vessels are covered." The pamphlet goes on to state that "[a]lthough federal employees and most maritime workers are not covered under Alaska law, they may be covered under federal law. If you want to know whether you are covered, contact the [Workers' Compensation] Division." Since his injury, Huseman has received continuous coverage by way of medical treatment and disability payments under the Alaska workers' compensation system. Huseman did not inquire about the availability of federal remedies, nor about his eligibility for additional benefits beyond the workers' compensation benefits that he was already receiving.

Nearly three and one-half years after his injury, Huseman filed suit in federal court alleging federal maritime claims of negligence under the Jones Act, unseaworthiness, and maintenance and cure. Huseman was deposed and testified that he had received and read the Terms of Employment and the pamphlet from the Alaska Workers' Compensation Board, both of which included statements regarding potential federal remedies. Huseman said that he did not understand the reference to federal benefits, and further, that he had forgotten about those documents by the time of his injury. Significantly, Huseman acknowledged that no one at Icicle or the Alaska Workers' Compensation Board told him that he could not pursue federal claims, and that he never asked about the availability of federal remedies. Huseman testified that had he inquired, Icicle and the Alaska agency probably would have explained the federal claims to him.

Icicle filed a motion for summary judgment, arguing that Huseman's claims were barred on timeliness grounds. The district court granted the motion, finding that "(a) [Huseman] was unaware that seamen such as himself might have claims under the Jones Act and general maritime law, (b)[Icicle] did not advise him of that fact, and (c) [Huseman] made no effort to ascertain whether he had any remedy other than that afforded by the Alaska State Workers' Compensation Act." The district court also held that no one at Icicle misled Huseman regarding the availability of federal remedies. Instead, as the district court pointed out, Huseman based his argument on the Terms of Employment, claiming that the document was misleading. Because Huseman admitted that he did not understand the reference to federal benefits in the Terms of Employment and that he had completely forgotten about the reference by the time of his injury, the district court concluded that Huseman could not have relied on the Terms of Employment in filing his suit beyond the statute of limitations. Accordingly, Huseman's Jones Act and unseaworthiness claims were time-barred.

With regard to maintenance and cure, the district court recognized that there is a dispute as to whether laches or the statute of limitations determined the timeliness of the claim. The district court did not decide the issue and instead held that the expiration of the statute of limitations brings a presumption that laches applies and that, absent good reason for an extension, the claim is barred. Because Huseman based his claim on ignorance of the law and his failure to inquire about the federal claims, the district court found his delay in filing unreasonable. Without further explanation, the district court also found that Icicle would be prejudiced by the late filing and held the maintenance and cure claim time-barred under laches.

ANALYSIS

Typically, "[w]e review de novo a grant of summary judgment and must determine whether, viewing the evidence in the light most favorable to the nonmoving party, there are any genuine issues of material fact and whether the district court correctly applied the relevant substantive law." Lopez v. Smith, 203 F.3d 1122, 1131 (9th Cir.2000) (en banc). This is a case, however, in which "[t]he law of this Circuit is somewhat inconsistent regarding the standard of review applicable to a district court's determination of whether equitable estoppel or equitable tolling applies to a claim barred by the statute of limitations." Johnson v. Henderson, 314 F.3d 409, 413 (9th Cir.2002). Generally, when—as here — the facts are undisputed, we review the district court's decision regarding equitable tolling de novo, and equitable estoppel for an abuse of discretion. Id. at 413-14; Santa Maria v. Pac. Bell, 202 F.3d 1170, 1175-76 (9th Cir.2000).

Huseman's arguments for preserving his Jones Act and unseaworthiness claims rely on equitable tolling and equitable estoppel. As we explain below, equitable tolling is not warranted because Huseman did not exercise due diligence in pursuing his federal claims. Huseman cannot take advantage of equitable estoppel because he did not (nor could he) reasonably rely on the disputed paragraph in the Terms of Employment or on Icicle's conduct in delaying his filing, since he concedes that he did not remember or refer to the Terms of Employment at the time of his injury. The dissent's attempt to impute reasonable reliance on the paragraph to Huseman is pure and unsupported speculation.

I. EQUITABLE TOLLING

Equitable tolling "focuses on whether there was excusable delay by the plaintiff" and "may be applied if, despite all due diligence, a plaintiff is unable to obtain...