Sanders v. Vigor Fab, LLC

• Decision Date: 30 December 2020
• Docket Number: A168740
• Citation: 308 Or.App. 282,480 P.3d 999
• Parties: Ronald A. SANDERS, Plaintiff-Appellant, v. VIGOR FAB, LLC, an Oregon limited liability company, Defendant-Respondent.
• Court: Oregon Court of Appeals

308 Or.App. 282

480 P.3d 999

Ronald A. SANDERS, Plaintiff-Appellant,

v.VIGOR FAB, LLC, an Oregon limited liability company, Defendant-Respondent.

A168740

Court of Appeals of Oregon.

Argued and submitted August 7, 2020.

December 30, 2020

Charles Robinowitz, Portland, argued the cause and filed the briefs for appellant.

Alice Newlin, Portland, argued the cause for respondent. Also on the brief were James P. McCurdy and Lindsay Hart, LLP.

Before DeVore, Presiding Judge, and DeHoog, Judge, and Mooney, Judge.

MOONEY, J.

Plaintiff brought this negligence action against Vigor Fab, LLC (Vigor Fab) under Oregon's Employer Liability Act (ELA), ORS 654.305 to 654.336, seeking to recover damages for injuries he sustained while trimming a steel deckplate for a barge being built by Vigor Fab. He had already filed a workers’ compensation claim against his employer, Vigor Marine, LLC (Vigor Marine), under the Longshore and Harbor Workers’ Compensation Act (LHWCA), 33 USC §§ 901 - 950. The trial court ruled on summary judgment that Vigor Fab and plaintiff's employer, Vigor Marine, were functionally integrated and, therefore, a "single entity" for purposes of the LHWCA. Consequently, Vigor Fab was, like Vigor Marine, immune from tort liability and plaintiff's case was dismissed as barred by section 905 of the LHWCA. Plaintiff assigns error to the court's granting of Vigor Fab's summary judgment motion, arguing that he was employed by Vigor Marine, not by Vigor Fab. He argues further that there remains a genuine issue of material fact concerning whether Vigor Fab and Vigor Marine are separate entities or a single entity for purposes of the LHWCA. We conclude that the trial court did not err in granting Vigor Fab's motion for summary judgment and we, therefore, affirm.

The question is whether, on the record presented, there exists a genuine issue as to whether Vigor Fab and Vigor Marine are a single entity entitling Vigor Fab to invoke the exclusive remedy provision of the LHWCA as a bar to plaintiff's ELA claim. On review of a grant of summary judgment, we view the facts and all reasonable inferences that may be drawn from them in favor of the nonmoving party—in this case, plaintiff. Jones v. General Motors Corp. , 325 Or. 404, 408, 939 P.2d 608 (1997). Summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law.

ORCP 47 C. That standard is met when " ‘no objectively reasonable juror could return a verdict for the adverse party on the matter that is the subject of the motion for summary judgment.’ " Robinson v. Lamb's Wilsonville Thriftway , 332 Or. 453, 455, 31 P.3d 421 (2001) (quoting Jones , 325 Or. at 408, 939 P.2d 608 ). We state the facts consistently with that standard.

Vigor Industrial, LLC (Vigor Industrial) owns several companies, including the two wholly owned subsidiaries involved here—Vigor Fab and Vigor Marine. Vigor Industrial is in the business of shipbuilding, ship repair, and complex industrial fabrication. The companies that comprise Vigor Industrial operate under common ownership, management, and control, and they share common executive leadership, senior management, and officers. As the parent entity, Vigor Industrial provides common core services and departments to all subsidiaries, including finance, payroll, information technology, human resources, procurement, risk management, environmental, and legal. Vigor Industrial's human resources department manages personnel matters for Vigor Fab and Vigor Marine, including overseeing employee benefits, hiring, termination, disciplinary issues, medical leave, and work-related injuries. Vigor Industrial calculates profits and losses on a consolidated basis rather than separately for each wholly owned entity. Vigor Industrial also provides procurement services and credit for both Vigor Fab and Vigor Marine, and it covers Vigor Fab and Vigor Marine employees for workplace injuries through the same certificate of insurance.

Vigor Fab builds ships and Vigor Marine repairs and maintains ships. They operate out of the same location, albeit from opposite ends of Vigor Industrial's Swan Island Shipyard facility on the Willamette River in Portland. And while Vigor Fab and Vigor Marine maintain their own tools and equipment, and conduct their own day-to-day operations, they share those premises, tools, and equipment, and they occasionally share personnel. Each entity hires and manages its own employees, but with the assistance of Vigor Industrial's human resources and central staffing departments. There are some notable differences between employees of Vigor Fab and those of Vigor Marine, including different job titles, different benefits, and different wage scales. Employees, customers, and outside regulators also generally regard Vigor Fab and Vigor Marine as separate entities.

Vigor Industrial processed plaintiff's job application, and it administered and processed his new hire paperwork, drug testing, medical testing, and orientation and training documentation. At the time of his injury, plaintiff was employed by Vigor Marine as a boilermaker and welder. According to plaintiff, Vigor Marine would assign him to complete limited jobs for Vigor Fab "about once a year." And, according to Vigor Industrial's Secretary and General Counsel, Ballou, such assignments were made pursuant to "an unwritten but understood ‘service sharing agreement’ between" Vigor Industrial's subsidiaries. Plaintiff was on temporary assignment with Vigor Fab when he was injured.

Plaintiff filed an LHWCA claim for workers’ compensation benefits shortly after the incident, naming Vigor Marine as his employer. Vigor Industrial's human resources and legal departments handled that claim, assisting Vigor Marine in its defense of that claim, and coordinating with Vigor Industrial's insurance carrier regarding plaintiff's benefits and coverage. Plaintiff filed this negligence case against Vigor Fab, alleging that his employer, Vigor Marine, was a "separate company from" Vigor Fab. He also alleged that the work he was performing for Vigor Fab was inherently dangerous, bringing it under Oregon's ELA. ORS 654.305.

Vigor Fab moved for summary judgment, arguing that "[p]laintiff is trying to ‘double-dip’ from two entities—Vigor Fab and Vigor Marine—which operate as a single entity for purposes of the exclusivity provision of the LHWCA." Vigor Fab supported its motion with the declaration of Ballou, who testified to the business and labor practices of Vigor Industrial, Vigor Fab, and Vigor Marine. Relying on the "single entity doctrine," which we discuss below, Vigor Fab argued that it qualified as plaintiff's employer under the LHWCA and that plaintiff's ELA claim was barred because his exclusive remedy was the workers’ compensation claim he had already filed.

In opposition to Vigor Fab's motion, plaintiff submitted a declaration with several attached exhibits. In that declaration, plaintiff stated that he was hired by Vigor Marine, received payments from Vigor Marine, was supervised by employees of Vigor Marine, and that no one working for Vigor Fab had the authority to fire him. He also stated that he had "never heard of an ‘unwritten but understood service sharing agreement’ between Vigor Marine and Vigor Fab," and that, in his experience, "employees for those two companies are completely separate and not shared freely[.]" He nevertheless acknowledged that he was working on a Vigor Fab job at the time of his injury, that he worked on Vigor Fab projects "about once a year," and that Vigor Fab communicated with his Vigor Marine supervisors, who directed him on Vigor Fab jobs. He emphasized the separate legal status of Vigor Fab and Vigor Marine and the fact that they each have their own website to support his argument that an issue of fact exists as to whether they are a single entity under the LHWCA.

The trial court noted that the parties were in agreement about the applicable legal test: Whether two discrete companies represent a single entity for purposes of LHWCA liability is governed by the "single entity test" articulated in Claudio v. United States , 907 F. Supp. 581, 586-89 (E.D.N.Y. 1995). The court applied the single entity test to the record before it and concluded that there was no genuine issue of material fact and that Vigor Fab and Vigor Marine were "functionally integrated." As such, the court held, they qualify as a single entity entitling both Vigor Marine and Vigor Fab to the tort immunity provided by the LHWCA exclusive remedy provision, barring plaintiff's ELA claim as a matter of law. It granted the motion for summary judgment and thereafter dismissed plaintiff's lawsuit.

Plaintiff appeals, arguing that the trial court erred by granting Vigor Fab's motion. He renews the argument that he made before the trial court: that genuine issues of material fact remain on the question of whether Vigor Fab and Vigor Marine are a single entity under the LHWCA and that Vigor Fab is not entitled to judgment as a matter of law.

The LHWCA is a federal workers’ compensation law that covers persons engaged in maritime employment:

"The term ‘employee’ means any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, and any harbor-worker including a ship repairman, shipbuilder, and ship-breaker * * *."

33 USC § 902(3).

"Except as otherwise provided in this section, compensation shall be payable under this chapter in respect of disability or death of an employee, but only if the disability or death results from an injury occurring upon the navigable waters of the United States (including any adjoining pier, wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by an employer in loading, unloading, repairing, dismantling, or building a vessel)."

33 USC § 903(a). The LHWCA provides the exclusive remedy for longshoremen and harbor workers...