Jurich v. Compass Marine, Inc., Civil Action No. 12–0176–WS–B.

• Decision Date: 02 November 2012
• Docket Number: Civil Action No. 12–0176–WS–B.
• Citation: 906 F.Supp.2d 1225
• Parties: Nicholas JURICH, et al., Plaintiffs, v. COMPASS MARINE, INC., et al., Defendants.
• Court: U.S. District Court — Southern District of Alabama

906 F.Supp.2d 1225

Nicholas JURICH, et al., Plaintiffs,

v.COMPASS MARINE, INC., et al., Defendants.

Civil Action No. 12–0176–WS–B.

United States District Court,

S.D. Alabama,

Southern Division.

Nov. 2, 2012.

Dennis Michael O'Bryan, O'Bryan Baun Cohen, Birmingham, MI, for Plaintiff.

David Graham Kennedy, Henry Chase Dearman, Mobile, AL, Salvador Joseph Pusateri, Kyle Andrew Khoury, New Orleans, LA, for Defendant.

ORDER

WILLIAM H. STEELE, Chief Judge.

This matter is before the Court on the motions to dismiss filed by defendants Compass Marine, Inc. (“Compass”) and REC Marine Logistics, LLC (“REC”). (Docs. 45, 46). The interested parties have filed briefs in support of their respective positions, (Docs. 45, 47, 50–53), and the motions are ripe for resolution. After careful consideration, the Court concludes that both motions are due to be granted in part and denied in part.

BACKGROUND

According to the first amended complaint, (Doc. 41), plaintiff Nicholas Jurich was employed by REC as a seaman. The other named plaintiffs were employed by other defendants as seamen. ( Id., ¶¶ 4, 12). Compass is an employment placement service, and it entered agreements with each of the plaintiffs for employment placement services. In conjunction with these agreements, the plaintiffs executed two ancillary documents. First, they signed paycheck mailing agreements (“PMAs”) authorizing their employers to mail their paychecks directly to Compass until Compass's fees and advances were collected in installments. Second, they signed special powers of attorney (“SPAs”) authorizing Compass to endorse their paychecks and deposit them into Compass's account. Compass would retain a portion of each paycheck as an installment payment on its fees and charges and remit the balance to the plaintiffs. ( Id., ¶ 6; Doc. 49, Exhibits AC).¹ The employer defendantsdid in fact mail the plaintiffs' paychecks to Compass, which did in fact deposit them in its account, retain a portion, and remit the balance to the plaintiffs. (Doc. 41, ¶¶ 6, 9).

The first amended complaint asserts the following causes of action:

• Count One Seaman's claim for wages (all defendants)

• Count Two Conversion (all defendants)

• Count Three Conspiracy (all defendants)

• Count Four Equitable rescission of contract and restitution for money had and received (Compass)

• Count Five Legal restitution/breach of contract (Compass)

• Count Six Breach of fiduciary duty (Compass)

• Count Seven RICO (all defendants)

(Doc. 41 at 4–15). Compass and REC seek dismissal of all claims asserted against them.

DISCUSSION

“There is no burden upon the district court to distill every potential argument that could be made based upon the materials before it on summary judgment.” Resolution Trust Corp. v. Dunmar Corp., 43 F.3d 587, 599 (11th Cir.1995). The Court's review on this motion to dismiss is similarly limited to those arguments the parties have expressly advanced. Moreover, “a passing reference to an issue in a brief [is] insufficient to properly raise that issue,” Transamerica Leasing, Inc. v. Institute of London Underwriters, 430 F.3d 1326, 1331 n. 4 (11th Cir.2005), and the Court will not supply legal or analytical support the parties have declined to offer themselves.

I. Seaman's Claim for Wages.

“An assignment ... of wages ... made before the payment of wages does not bind the party making it, except allotments authorized by section 10315 of this title.” 46 U.S.C. § 11109(b). The first amended complaint alleges that the PMAs constitute assignments of wages made before payment of wages within the contemplation of Section 11109(b). (Doc. 41, ¶ 15). It further alleges that the PMAs are not authorized by Section 10315. ( Id., ¶ 8). The PMAs are thus non-binding on the plaintiffs. ( Id., ¶¶ 7, 15). Because they are unauthorized by Section 10315, they are also unlawful. ( Id., ¶ 8). In Count One, the plaintiffs demand from both Compass and the employers “the balance of their wages allotted and forwarded to and retained by” Compass. ( Id., ¶ 16).

Compass construes Count One as asserting a claim under Section 11109(b) and/or Section 10315, and it presents extensive argument that neither statute provides a private cause of action. (Doc. 47 at 1–2, 6–18; Doc. 53 at 1–5). The plaintiffs, however, disavow any statutory claim and expressly limit Count One to “a general maritime law claim for wages.” (Doc. 50 at 7). Such a claim is plainly presented in the first amended complaint, which asserts that “[s]ubject matter jurisdiction is founded under the general maritime law for ... a seaman's claim for wages.” (Doc. 41, ¶ 3). To the uncertain extent that Count One may be construed as also asserting a statutory claim,² the plaintiffs have abandoned it, and any such claim is due to be dismissed on that basis.

Compass devotes its briefing to negating the existence of an implied statutory cause of action, and very little of its briefing is even potentially relevant to a claim for wages under the general maritime law (“GML”). The Court addresses below the few arguments presented by Compass that could be construed as reaching the GML wage claim.

Although the plaintiffs do not assert a statutory cause of action, “[t]he nonbinding assignment rule of contractual construction contained at 46 USC 11109(b) is being applied vis-á-vis the remedy of a seaman's claim for wages.” (Doc. 50 at 7). As noted, Count One asserts that the PMAs represent assignments of wages before payment, made non-binding by Section 11109(b). (Doc. 41, ¶ 15). According to Compass, “if the seaman fully consents to the deduction from his wage, this statute is wholly inapplicable and provides the seaman no relief.” (Doc. 47 at 14). The only case on which Compass relies for this proposition did not address Section 11109(b) but only the predecessor to Section 11109(a). In re: Williams, 20 B.R. 154 (Bankr.E.D.Ark.1982). Subsection (a) deals with “attachment or arrestment from any court,” and the Williams Court ruled this provision was “designed to prevent involuntary court ordered garnishments and attachments and not the prevention of voluntary deductions.” Id. at 154. Thus, the debtor could propose as part of his Chapter 13 plan to have a portion of his seaman's wages remitted directly from his employer to the trustee, and the Court could so order. Id.

The Williams Court cited no authority in support of its ruling, and it offered no explanation for it but only the raw conclusion quoted above. Moreover, Williams' voluntary-involuntary distinction is arguably dicta, ³ and no known case has ever cited Williams for that or any other proposition.

But even if Williams has any persuasive capacity in the context of Section 11109(a), it has none under Section 11109(b). By its terms, Williams is limited to the former context, and Compass articulates no basis for extrapolating it to the latter. On the contrary, it appears likely that a voluntary-involuntary distinction would make no sense under Section 11109(b). Unlike attachments and arrestments “from any court” under Section 11109(a), assignments and sales of wages under Section 11109(b) would seem always to be the result of the seaman's voluntary action,⁴ such that Compass's proposed construction might well read the provision out of practical existence—an odd fate for a statutory protection that has been in place for well over a century.⁵

Compass denies it was the employers' agent. (Doc. 47 at 17–18). This is in apparent response to the allegation of Count One that Compass “functioned as a hiring or recruiting agent for the respective employers.” (Doc. 41, ¶ 16). But Count One does not limit the basis of Compass's liability to an agency theory. Instead, Count One also asserts that Compass is liable because “Plaintiffs' wages were allotted and forwarded [to Compass] with unlawful allotments being collected [by Compass].” ( Id.). Compass in its principal brief does not address this theory of liability and thus cannot obtain dismissal regardless of the merits vel non of its agency argument.

In its reply brief, Compass questions whether a claim for wages can be maintained against a third party. (Doc. 53 at 5). No such argument appears in Compass's principal brief.⁶ District courts, including this one, ordinarily do not consider arguments raised for the first time on reply, ⁷ and Compass offers no reason the Court should depart from that rule in this case.

Even were the Court to consider Compass's tardy argument, the result would not change. Compass offers no case or other authority that precludes a GML claim for wages against a third party. Instead, Compass merely argues that certain of the cases cited in the plaintiffs' brief do not involve such a claim and therefore do not prove that such a claim exists. (Doc. 53 at 5–11). The burden at this juncture, however, is not on the plaintiffs to show that such a claim exists but on Compass to demonstrate that such a claim does not exist. Compass's presentation falls far short of doing so.⁸

As noted, the plaintiffs do not bring a statutory cause of action under Count One, but they do rely on Sections 11109(b) and 10315 to show why they are entitled to the wages their employers sent to Compass. REC seeks to explain why these statutes do not support a GML claim against it for these wages.

The only effect of Section 11109(b), REC says, is to make a seaman's prepayment assignment of his wages (if unauthorized by Section 10315) non-binding. It does not make such an assignment illegal, and it does not make an employer's honoring of such an assignment improper (so long as the seaman has not notified the employer that he has exercised his option to void the assignment). Section 10315(c) does expressly make certain allotments unlawful, but that section is part of Chapter 103, which applies only to vessels on voyages between the United States and a foreign port or between an American Atlantic port and an American Pacific port,⁹ neither of which is implicated here....