In re M/V MSC Flaminia

• Decision Date: 27 April 2016
• Docket Number: 12-cv-8892 (SAS)
• Citation: 183 F.Supp.3d 499
• Parties: In re M/V MSC Flaminia.
• Court: U.S. District Court — Southern District of New York

183 F.Supp.3d 499

In re M/V MSC Flaminia.

12-cv-8892 (SAS)

United States District Court, S.D. New York.

Signed April 27, 2016

James Edwin Ryan, Dougherty, Ryan, Giuffra, Zambito & Hession, Eugene Joseph O'Connor, Robert Eugene O'Connor, Timothy Semenoro, Montgomery, McCracken, Walker & Rhoads, LLP, Andrew John Warner, Chalos O'Connor LLP, Port Washington, NY, Anthony J. Pruzinsky, John Eric Olson, Jr., Kipp Charles Leland, Lauren Elizabeth Komsa, Raymond Paul Hayden, Thomas Earl Willoughby, Hill Rivkins LLP, New York, NY, James William Carbin, Patrick Ryan McElduff, Duane Morris, LLP, Newark, NJ, for Plaintiff.

OPINION AND ORDER

SHIRA A. SCHEINDLIN, United States District Judge.

I. INTRODUCTION

On December 7, 2012, Conti 11. Container Schiffahrts-Gmbh & Co. KG ("Conti") and NSB Niederelbe Schiffahrtsgesselschaft MBH & Co. KG ("NSB"; together "Petitioners") commenced this action under section 30511 of Title 46 of the United States Code, seeking to limit their liability relating to a July 14, 2012 explosion and fire on the MSC Flaminia (the "Vessel"), a cargo ship owned by Conti and operated by NSB.¹ The fire resulted in the deaths of three crew members, including Cezary Siuta, the Chief Mate of the Vessel. Iwona Siuta, Cezary's wife, filed a claim against Petitioners seeking damages as representative of Cezary's estate under the Jones Act, the Death on the High Seas Act ("DOHSA"), and the general maritime law of the United States.

Petitioners now seek to dismiss the claim brought by Siuta's estate (the "Estate") on the basis that neither the Jones Act, DOHSA, nor the General Maritime Law of the United States apply to this case. According to Petitioners, German law applies exclusively to the Estate's claim. For the following reasons, Petitioners' motion is GRANTED.

II. BACKGROUND²

A. Conti and the Vessel

Conti is the owner of the Vessel. It is a single-ship owning entity registered to do business in Germany.³ Conti's parent, the Conti Group, also a German entity, built the Vessel in Korea. The funds for the Vessel came mainly from European investors—of the eight hundred investors, fewer than five are residents of the United States.⁴ None of the owners, officers, or directors of Conti Group reside in or are citizens of the United States.⁵ Conti does not pay corporate or income tax to any United States agency, and does not deal directly with any American banks.⁶ Conti does not have offices or subsidiaries in the United States.⁷

Between 2006 and 2012, the Vessel visited United States ports 199 times—an average of two visits per month.⁸ At the time of Siuta's death, the Vessel was sailing from Charleston to Belgium.⁹ The Vessel's charterer was Mediterranean Shipping Corporation ("MSC"), a Swiss Company.¹⁰

B. NSB

NSB is a German ship management company that operates various vessels on behalf of several ship owning companies.¹¹ "Forty percent of NSB's business consists of NSB vessels traveling to and from United States ports."¹²

According to NSB's corporate representative, Torge Schulz, NSB's business involves three primary routes. The busiest route, involves vessels traveling from Europe to Asia. According to NSB's Corporate Representative, Torge Schulz, this route represents 60 percent of NSB's business. The second busiest route, involves NSB vessels traveling from ports in the West Coast of the United States to ports in Asia—and back. This route represents 30 percent of NSB's business. The third busiest route, involves NSB vessels traveling from ports in the East Coast of the United States to Europe—and back. This route represents 10 percent of NSB's business. All in all, therefore, 40 percent of NSB's business consist of NSB vessels traveling to and from United States ports.¹³

"Between 2006 and 2012, NSB vessels visited United States ports 4,355 times." That is an average of [two] daily visits to the United States, each day of the year, for [seven] years.‘¹⁴ "All in all, between 2006 and 2012, NSB vessels spent 2,527 days in [ ] United States [ports]."¹⁵

NSB advertises on its website that it has permanent offices in Germany, Singapore, South Korea, and the United States.¹⁶ The United States office is listed as "NSB-USA." The parties dispute the status of NSB-USA. According to Petitioners, "NSB-USA is an independent contractor of NSB" and NSB-USA was founded by Jonas Lyborg, "as a subsidiary of his original and continuing company, J.L. Maritime," on "Lyborg's initiative alone[,]" not at the direction of NSB.¹⁷ According to the Estate, "[d]espite attempts by NSB to disguise this office as an independent entity ... discovery revealed that at all relevant times the Alabama office has existed for the single and exclusive purpose of managing NSB's business affairs in the United States."¹⁸ The Estate claims that "[t]here is no questions that Mr. Lyborg is NSB's permanent agent in the United States."¹⁹

Lyborg is an American citizen, and as stated in his contract with NSB, he is a "Key Person" for NSB in the United States.²⁰ The contract states that NSB-USA's mission is to provide services for NSB "within the territorial waters of the United States of America ... to protect the interests of NSB, including but not limited to, services as a commercial representative, services as a technical advisor and services as a security advisor."²¹ NSB does not own an interest in NSB-USA.

None of the owners, officers, or directors of NSB reside in or are citizens of the United States, except potentially Lyborg, whose role the parties dispute.²² None of the approximately 170 ships which are managed and operated by NSB are registered in the United States or are owned by an American Company.²³ NSB does not pay corporate or income taxes to any United States agency.²⁴ Other than the possible exception of NSB-USA, NSB does not have offices or subsidiaries in the United States.²⁵ None of the NSB managed vessels were registered in the United States.²⁶

NSB Reisboro is a subsidiary of NSB, which operates as NSB's travel branch. While NSB operates traditional container cargo vessels, the travel branch arranges passenger cruises on board the cargo vessels.²⁷ NSB derives less than one percent of its gross income from passenger service on its cargo ships.²⁸

C. Revenue Streams and Charterers

The shipowners for which NSB manages vessels, such as Conti, have long-term "charter" or ship-leasing agreements with third-party cargo carriers.²⁹ For example, there was a charter agreement between Conti and MSC with respect to the Vessel. NSB has a corresponding management agreement with the shipowner.³⁰ Thus, shipowners receive their revenue in the form of charter-hire or ship-leasing payments from the charterer. In Conti's case, its income was earned almost entirely from the charter hire paid by MSC to lease the Vessel.³¹ Operators such as NSB earn their revenue from ship management services.

"Pursuant to the various Charter Agreements, the chartered vessels are allowed to call at any safe ports in the world at the charterer's direction, including ports in the United States, for the purpose of loading and discharging cargo."³² The cargo loaded or discharged is contracted for carriage by the charterer of the particular ship, or its agents, and the freight, handling, stowage and other charges for the ocean carriage is paid to and received by the charterer. Stevedore and port costs, such as towboat and port services, are paid by the charterer, and not by NSB or the shipowner.³³ None of the vessels managed by NSB were chartered to United States corporations, corporate entities, subsidiaries or agents of United States corporations.³⁴

D. Cezary Siuta

Cezary Siuta, the Chief Mate of the Vessel, was a citizen and resident of Poland.³⁵ He was employed by NSB pursuant to a contract of employment governed by German law. The employment contract was signed and executed by Siuta in Germany. The Estate is currently receiving the full benefits to which it is entitled under the laws of Germany as a result of Siuta's death aboard the Vessel.³⁶

III. LEGAL STANDARD

Summary judgment is appropriate where, "viewing the record in the light most favorable to the non-moving party ... 'there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.' "³⁷ "In making this determination ... we resolve all ambiguities and draw all permissible factual inferences in favor of the party against whom summary judgment is sought."³⁸ "A fact is material if it might affect the outcome of the suit under the governing law, and an issue of fact is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party."³⁹

"The moving party bears the burden of showing the absence of a genuine dispute as to any material fact."⁴⁰ To defeat a motion for summary judgment, the non-moving party must "'do more than simply show that there is some metaphysical doubt as to the material facts, and may not rely on conclusory allegations or unsubstantiated speculation."'⁴¹ "If the non-moving party has the burden of proof on a specific issue, the movant may satisfy its initial burden by demonstrating the absence of evidence in support of an essential element of the non-moving party's claim."⁴²

"'The function of the district court in considering the motion for summary judgment is not to resolve disputed questions of fact but only to determine whether, as to any material issue, a genuine factual dispute exists."'⁴³ "'Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge."'⁴⁴

IV. APPLICABLE LAW

Under the Jones Act, "[a]ny seaman who shall suffer personal injury in the course of his employment may, at his election, maintain an action for damages at law, with the right of trial by jury."⁴⁵ Although this language provides broad protections to seamen, it does not give rise to a cause of action by any seaman against any defendant under any circumstance....