Pac. Operators Offshore, LLP v. Valladolid

• Decision Date: 11 January 2012
• Docket Number: No. 10–507.,10–507.
• Citation: 565 U.S. 207,181 L.Ed.2d 675,132 S.Ct. 680
• Parties: PACIFIC OPERATORS OFFSHORE, LLP, et al., Petitioners v. Luisa L. VALLADOLID, et al.
• Court: U.S. Supreme Court

565 U.S. 207

132 S.Ct. 680

181 L.Ed.2d 675

PACIFIC OPERATORS OFFSHORE, LLP, et al., Petitioners

v.Luisa L. VALLADOLID, et al.

No. 10–507.

Supreme Court of the United States

Argued Oct. 11, 2011.

Decided Jan. 11, 2012.

Paul D. Clement, Washington, DC, for Petitioners.

Joseph R. Palmore, Washington, DC, for Federal Respondent.

David C. Frederick, Washington, DC, for Private Respondent.

Peder K. Batalden, Peter Abrahams, Horvitz & Levy LLP, Encino, CA, Paul D. Clement, Counsel of Record, Erin E. Murphy, Bancroft PLLC, Washington, DC, Michael W. Thomas, Thomas, Quinn & Krieger, LLP, San Francisco, CA, for Petitioners.

M. Patricia Smith, Solicitor of Labor, Rae Ellen Frank James, Associate Solicitor, Sean G. Bajkowski, Mark A. Reinhalter, Counsel, Rita A. Roppolo, Attorney, Department of Labor, Washington, DC, Donald B. Verrilli, Jr., Solicitor General, Edwin S. Kneedler, Deputy Solicitor General, Joseph R. Palmore, Assistant to the Solicitor General, Counsel of Record, Department of Justice, Washington, DC, for Federal Respondent.

Michael F. Sturley, Lynn E. Blais, Austin, TX, Erin Glenn Busby, David C. Frederick, Counsel of Record, Gregory G. Rapawy, Beverly C. Moore, Kellogg, Huber, Hansen, Todd, Evans & Figel, P.L.L.C., Washington, DC, Joshua T. Gillelan II, Washington, DC, Timothy K. Sprinkles, Charles D. Naylor, San Pedro, CA, for Private Respondent.

Justice THOMAS delivered the opinion of the Court.

The Outer Continental Shelf Lands Act (OCSLA) extends the federal workers' compensation scheme established in the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. § 901 et seq., to injuries " occurring as the result of operations conducted on the outer Continental Shelf" for the purpose of extracting natural resources from the shelf. 43 U.S.C. § 1333(b). The United States Court of Appeals for the Ninth Circuit determined that the OCSLA extends coverage to an employee who can establish a substantial nexus between his injury and his employer's extractive operations on the Outer Continental Shelf. We affirm.

I

Petitioner Pacific Operators Offshore, LLP (Pacific), operates two drilling platforms on the Outer Continental Shelf off the coast of California and an onshore oil and gas processing facility in Ventura County, California. Pacific employed Juan Valladolid as a general manual laborer—known in the trade as a roustabout—in its oil exploration and extraction business. Valladolid spent about 98 percent of his time on one of Pacific's offshore drilling platforms performing maintenance duties, such as picking up litter, emptying trashcans, washing decks, painting, maintaining equipment, and helping to load and unload the platform crane. Valladolid spent the remainder of his time working at Pacific's onshore processing facility, where he also performed maintenance duties, including painting, sandblasting, pulling weeds, cleaning drain culverts, and operating a forklift.

While on duty at the onshore facility, Valladolid died in a forklift accident. His widow, a respondent here, filed a claim for benefits under the LHWCA pursuant to the extension of that Act contained within the OCSLA. The OCSLA provides, in relevant part:

"With respect to disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf for the purpose of exploring for, developing, removing, or transporting by pipeline the natural resources, or involving rights to the natural resources, of the subsoil and seabed of the outer Continental Shelf, compensation shall be payable under the provisions of the [LHWCA]." 43 U.S.C. § 1333(b).

After a hearing, an Administrative Law Judge (ALJ) dismissed respondent's claim. The ALJ reasoned that Valladolid's fatal injury was not covered under § 1333(b) because his accident occurred on land, rather than on the Outer Continental Shelf. On appeal, the United States Department of Labor's Benefits Review Board affirmed, concluding that Congress intended to limit the coverage provided by the OCSLA to injuries suffered by employees within the "geographical locale" of the Outer Continental Shelf. L.V. v. Pacific Operations Offshore, LLP, 42 BRBS 67, 71 (2008) (per curiam).

The Ninth Circuit reversed, holding that § 1333(b) neither contains a "situs-of-injury" requirement, as the Fifth Circuit has held, nor imposes a "but for" causation requirement, as the Third Circuit has held. See 604 F.3d 1126, 1130–1140 (2010) (rejecting the holdings of Mills v. Director, Office of Workers' Compensation Programs, 877 F.2d 356 (C.A.5 1989) (en banc); Curtis v. Schlumberger Offshore Service, Inc., 849 F.2d 805 (C.A.3 1988) ). Instead, the Ninth Circuit concluded that "the claimant must establish a substantial nexus between the injury and extractive operations on the shelf" to qualify for workers' compensation benefits under the OCSLA. 604 F.3d, at 1139. We granted Pacific's petition for a writ of certiorari to resolve this conflict. 562 U.S. ––––, 131 S.Ct. 1472, 179 L.Ed.2d 298 (2011).

II

In 1953, Congress enacted the Submerged Lands Act, 67 Stat. 29, 43 U.S.C. § 1301 et seq., which extended the boundaries of Coastal States three geographic miles into the Atlantic and Pacific Oceans and three marine leagues into the Gulf of Mexico. At the same time, Congress enacted the OCSLA, affirming the Federal Government's authority and control over the "outer Continental Shelf," defined as the submerged lands subject to the jurisdiction and control of the United States lying seaward and outside of the submerged lands within the extended State boundaries. 67 Stat. 462, 43 U.S.C. §§ 1331(a), 1332(1). As defined by the OCSLA, the Outer Continental Shelf includes the "submerged lands" beyond the extended state boundaries, § 1331(a), but not the waters above those submerged lands or artificial islands or installations attached to the seabed. For simplicity's sake, we refer to the entire geographical zone as the "OCS."

Section 1333 extends various provisions of state and federal law to certain aspects of the OCS. For example, § 1333(a)(1) extends the Constitution and federal laws of civil and political jurisdiction "to the subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all installations and other devices permanently or temporarily attached to the seabed," for the purpose of extracting its natural resources. Section 1333(a)(2)(A) makes the civil and criminal laws of each adjacent State applicable to "that portion of the subsoil and seabed of the outer Continental Shelf, and artificial islands and fixed structures erected thereon, which would be within the area of the State if its boundaries were extended seaward to the outer margin of the outer Continental Shelf." Section 1333(b), the provision involved in this case, makes LHWCA workers' compensation benefits available for the "disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf" for the purpose of extracting its natural resources.

The question before us is the scope of coverage under § 1333(b). The parties agree that § 1333(b) covers employees , such as oil rig and drilling platform workers, who are injured while working directly on the OCS to extract its natural resources. They disagree, however, whether employees who are involved in extraction operations but who are injured beyond the OCS are also covered under the OCSLA. This dispute focuses on the meaning of the phrase "any injury occurring as the result of operations conducted on the outer Continental Shelf" in § 1333(b).

The Courts of Appeals have offered competing interpretations. In Curtis v. Schlumberger Offshore Service, Inc., 849 F.2d, at 811, the Third Circuit held that, because Congress intended LHWCA coverage to be expansive, § 1333(b) extends to all injuries that would not have occurred "but for" operations on the OCS. The Third Circuit thus concluded that an employee who worked on a semisubmersible drill rig, but who was killed in a car accident on the way to the helicopter that was to fly him to that rig, was eligible for § 1333(b) benefits. Id., at 806, 811. As the Third Circuit summarized, " ‘But for’ [Curtis'] travelling to [his drill rig] for the purpose of conducting ‘operations' within § 1333(b), employee Curtis would not have sustained injuries in the automobile accident." Id., at 811.

In Mills v. Director, supra, the Fifth Circuit, sitting en banc, adopted a narrower interpretation of § 1333(b). The court concluded that Congress intended to establish "a bright-line geographic boundary for § 1333(b) coverage," and held that § 1333(b) extends coverage only to employees engaged in OCS extractive activities who "suffer injury or death on an OCS platform or the waters above the OCS." Id., at 362. Applying its "situs-of-injury" test, the Fifth Circuit held that a welder who was injured on land during the construction of an offshore oil platform was not eligible for § 1333(b) benefits. Id., at 357, 362.

In the case below, the Ninth Circuit rejected the Fifth Circuit's "situs-of-injury" requirement as unsupported by the text of § 1333(b), and the Third Circuit's "but for" test as too broad to be consistent with Congress' intent. 604 F.3d, at 1137, 1139. Instead, the Ninth Circuit adopted a third interpretation of § 1333(b), holding that a "claimant must establish a substantial nexus between the injury and extractive operations on the shelf" to be eligible for § 1333(b) benefits. Id., at 1139."To meet the standard," the Ninth Circuit explained, "the claimant must show that the work performed directly furthers outer continental shelf operations and is in the regular course of such operations." Ibid.

The Solicitor General suggests yet a fourth interpretation of § 1333(b).¹ This interpretation would extend coverage to two categories of injuries: (1) all on-OCS injuries suffered by employees of companies engaged in resource extraction on the OCS; and ...