Plains Pipeline, L.P. v. Great Lakes Dredge & Dock Co.
| Decision Date | 29 August 2014 |
| Docket Number | Civil Action No. 13–398. |
| Citation | 46 F.Supp.3d 632 |
| Parties | PLAINS PIPELINE, L.P., Phillips66 Pipeline, LLC v. GREAT LAKES DREDGE & DOCK COMPANY, Great Lakes Dredge & Dock Company, LLC of Louisiana, Dawn Services, LLC, in Personam and the Dredge Texas, Tugs Pacific Dawn and Coastal Dawn, and Their Engines, Tackle, Furniture, Appurtenances, etc. in rem, Defendants. |
| Court | U.S. District Court — Eastern District of Louisiana |
Norman Charles Sullivan, Jr., W. Jacob Gardner, Jr., Fowler Rodriguez, New Orleans, LA, for Plains Pipeline, L.P., Phillips66 Pipeline, LLC.
James H. Roussel, Nyka M. Scott, Baker Donelson Bearman Caldwell & Berkowitz, Arthur Gordon Grant, Jr., Philip S. Brooks, Jr., Montgomery Barnett, Thomas Kent Ledyard Morrison, Colin B. Cambre, Phelps Dunbar, LLP, New Orleans, LA, for Great Lakes Dredge & Dock Company, Great Lakes Dredge & Dock Company, LLC of Louisiana, Dawn Services, LLC, in Personam and the Dredge Texas, Tugs Pacific Dawn and Coastal Dawn, and Their Engines, Tackle, Furniture, Appurtenances, etc.
ORDER AND REASONS
Before the Court is a Motion for Summary Judgment (R. Doc. 39) filed by Defendants, Great Lakes Dredge & Dock, LLC and Great Lakes Dredge & Dock Company, LLC of Louisiana (collectively “Great Lakes”) and against plaintiff, Phillips66 Pipeline, LLC (“Phillips”). Having reviewed the pleadings, memoranda, record, and relevant law, the Court, for the reasons assigned, grants the motion.
This case arises out of an allision between a dredging barge and an underwater oil pipeline. In 1953, Gulf Oil Company constructed and installed a pipeline running from Bay Marchand, Louisiana to Alliance, Louisiana, called the “BOA pipeline”. (Def.'s Mem. Supp. Summ. J. 2, R. Doc. 39). The pipeline was then acquired by Chevron and subsequently sold to BP Oil Pipeline Company (“BP”); BP sold its interest in the pipeline to Plains, making Plains the 100% owner of the pipeline.1 In May of 2007, plaintiffs Plains Pipeline L.P. (“Plains”) and Phillips were assigned the rights, duties, and obligations of BP and TPC Pipeline company, as set forth in those original parties' Service Agreement and Operating Agreement. (Pl.'s Mem. Opp. Summ. J., 2, R. Doc. 48; see also Williams Aff. Ex. A ¶ 4, R. Doc. 48–1). BP, as “Pipeline Owner” or “Operator” under the agreements, assigned its rights to Plains and TPC Pipeline Company (and its parent corporation, Tosco Corporation) as “Pipeline Lessee” and “Refinery Owner”, under the agreements, assigned its rights to Phillips. (Williams Affidavit, Ex. A ¶ 4, R. Doc. 48–1; Service and Operating Agreements Ex. B–C, 1, 19, 24, R. Docs. 48–2, 48–3). At the time of the incident in question, it is undisputed that Plains Pipeline owned the pipeline, while Phillips was the owner of the crude oil being transported in the pipeline. . In addition, the Service and Operating Agreements were in effect at the time of the incident. (Williams Aff. Ex. A, ¶ 3, R. Doc. 48–1).
On March 17, 2012, the Dredge TEXAS, a cutter head and suction dredge owned by Great Lakes, and its flotilla entered Barataria Pass and proceeded to lower the cutter head onto the seafloor to fix the dredge's position. (Def.'s Mem. 2, R. Doc. 39). After the dredge was positioned, the dredge deployed two anchors to secure its position. Id. Phillips alleges that in lowering the cutter head of the Dredge TEXAS, the cutter head struck and damaged the BOA pipeline. (Id.; Pl.'s Opp. 1, R. Doc. 48).
Following the incident, according to the pipeline meter, a total of 204 barrels of crude oil were lost. (Def.'s Mem. 3, R. Doc. 39). The pipeline was then shut down. Id. at 5. As a result, Phillips incurred additional expenses in order to transport its crude oil during the pipeline's repair. (Pl.'s Statement of Uncontested Facts 1, R. Doc. 48–6; Def.'s Statement of Uncontested Facts 2, R. Doc. 39–10). Phillips' expert submitted a report detailing Phillips' sustained damages including: Chevron inventory fee, freight charges, inspections charge, fuel charges, and lost product. (Def.'s Mem. 4, R. Doc. 39).
Great Lakes contends that, with the exception of the claim of damages for lost product, Phillips' claims are for purely economic damages resulting from the damage to the BOA pipeline and that because Phillips did not own the pipeline it cannot recover for such damages under the rule of Robins Dry Dock and Repair Co. v. Flint, 275 U.S. 303, 48 S.Ct. 134, 72 L.Ed. 290 (1927). (Def.'s Mem. 8–9, R. Doc. 39). Phillips does not contest that Plains owned the pipeline; however, Phillips argues that it maintained a proprietary interest sufficient to overcome the Robins Dry Dock bar as evidenced by the Service and Operating Agreements between Phillips and Plains. (Pl.'s Opp. 8, R. Doc. 48).
Rule 56(a) of the Federal Rules of Civil Procedure provides that summary judgment should be granted “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” The party moving for summary judgment bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record “which it believes demonstrate the absence of a genuine issue of material fact.” Stults v. Conoco, 76 F.3d 651 (5th Cir.1996) (citing Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 912–13 (5th Cir.1992) ). However, if the nonmoving party would bear the burden of proof on a claim at trial, the moving party need not negate the elements of that claim, but only to “point out the absence of evidence supporting the nonmoving party's case.” Brown v. Trinity Catering, Inc., 2007 WL 4365384 (E.D.La. Dec. 11, 2007) (citing Stults, 76 F.3d at 656 ).
When the moving party has carried its burden under Rule 56, its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. The nonmoving party must come forward with “specific facts showing that there is a genuine issue for trial.” Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 588, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986) ; Tubacex, Inc. v. M/V Risan, 45 F.3d 951, 954 (5th Cir.1995). “A genuine issue of material fact exists ‘if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.’ ” Pylant v. Hartford Life and Accident Insurance Company, 497 F.3d 536, 538 (5th Cir.2007) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). Summary judgment evidence must be “viewed in the light most favorable to the nonmovant, with all factual inferences made in the nonmovant's favor.” Bazan ex rel. Bazan v. Hidalgo County, 246 F.3d 481, 489 (5th Cir.2001) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. at 255, 106 S.Ct. at 2513 ). However, as the Fifth Circuit has explained:
[c]onclusory statements, speculation, and unsubstantiated assertions cannot defeat a motion for summary judgment. The Court has no duty to search the record for material fact issues. Rather, the party opposing the summary judgment is required to identify specific evidence in the record and to articulate precisely how this evidence supports his claim.
RSR Corporation v. International Insurance Company, 612 F.3d 851, 857 (5th Cir.2010).
As stated above, Great Lakes brings their instant motion for summary judgment only as to Phillips' claims for economic losses2 and avers that those claims are barred by the well-settled rule set forth in Robins Dry Dock and expounded upon in State of Louisiana ex rel. Guste v. M/V TESTBANK, 752 F.2d 1019 (5th Cir.1985) (en banc) that a plaintiff may not recover in an unintentional maritime tort suit “for economic loss if that loss resulted from physical damage to property in which he had no proprietary interest,” TESTBANK, 752 F.2d at 1022.3 “While other jurisdictions may have abandoned or relaxed the bright line rule of Robins and TESTBANK, this circuit ‘has not retreated from TESTBANK's physical injury requirement.’ ” In re Taira Lynn Marine Ltd. No. 5, LLC, 444 F.3d 371, 379 (5th Cir.2006) (quoting Reserve Mooring Inc. v. Am. Commercial Barge Line, LLC, 251 F.3d 1069, 1071 (5th Cir.2001) ); see also In re Bertucci Contracting Co., L.L.C., 712 F.3d 245, 246–47 (5th Cir.2013). The Robins Dry Dock “bright line” rule functions as a limitation liability in tort based on foreseeability, Corpus Christi Oil & Gas Co. v. Zapata Gulf Marine Corp., 71 F.3d 198, 202–03 (5th Cir.1995), and the Fifth Circuit has been “reluctant to recognize claims based solely on harm to the interest in contractual relations or business expectancy.” Louisville & N.R. Co. v. M/V Bayou Lacombe, 597 F.2d 469, 472–73 (5th Cir.1979) (citing Dick Meyers Towing Service, Inc. v. United States, 577 F.2d 1023, 1025 (5th Cir.1978) ).
A “critical factor in the application of the Robins holding ... [is] ‘the character of the interest harmed.’ ” Vicksburg Towing v. Mississippi Marine Transport, 609 F.2d 176, 177 (5th Cir.1980) (quoting Dick Meyers, 577 F.2d at 1025 (footnote omitted)); see also Consol. Aluminum Corp. v. C.F. Bean Corp., 772 F.2d 1217, 1222 (5th Cir.1985). In Robins Dry Dock, Justice Holmes recognized that some charterers of vessels might have “an interest protected by the law against unintended injuries inflicted upon the vessel by third persons” without knowledge of a charter, such as the interests conveyed in a demise charter; if such an interest exists, “it must be worked out through their contract relations with the owners, not on the postulate that they have a right in rem against the ship.” Robins Dry Dock, 275 U.S. at 308, 48 S.Ct. at 135. The Fifth Circuit elaborated upon Justice Holmes' distinction, noting that, unlike a time-charterer, a “demise-charterer stands in the shoes of the owner of the vessel for the duration of the contract while the shipowner retains merely a...
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