Savage Servs. Corp. v. United States

• Decision Date: 25 February 2021
• Docket Number: CIVIL ACTION 20-0137-WS-N
• Citation: 522 F.Supp.3d 1114
• Parties: SAVAGE SERVICES CORPORATION, et al., Plaintiffs, v. UNITED STATES of America, Defendant.
• Court: U.S. District Court — Southern District of Alabama

522 F.Supp.3d 1114

SAVAGE SERVICES CORPORATION, et al., Plaintiffs,

v.UNITED STATES of America, Defendant.

CIVIL ACTION 20-0137-WS-N

United States District Court, S.D. Alabama, Southern Division.

Signed February 25, 2021

Filed February 26, 2021

Jay P. Farmer, Pro Hac Vice, Lugenbuhl, Wheaton, Peck, Rankin & Hubbard, New Orleans, LA, Todd G. Crawford, Lugenbuhl, Wheaton, Peck, Rankin & Hubbard, Gulfport, MS, for Plaintiff Savage Services Corporation.

Jay P. Farmer, Lugenbuhl, Wheaton, Peck, Rankin & Hubbard, New Orleans, LA, Todd G. Crawford, Lugenbuhl, Wheaton, Peck, Rankin & Hubbard, Gulfport, MS, for Plaintiff Savage Inland Marine, LLC.

Michael A. DiLauro, U.S. Department of Justice, Orla M. Brady, Aviation, Space & Admiralty Litigation, Washington, DC, Kasee Sparks Heisterhagen, U.S. Attorney's Office, Mobile, AL, for Defendant.

ORDER

WILLIAM H. STEELE, UNITED STATES DISTRICT JUDGE

This matter comes before the Court on defendant's Partial Motion to Dismiss (doc. 49) and plaintiffs’ overlapping Motion for Partial Summary Judgment (doc. 55). Consolidated briefing has been ordered and completed. (See doc. 59.) Both Motions are now ripe.

I. Relevant Background.¹

This action arises from an oil spill from a barge resulting from a mishap in the Jamie Whitten Lock on the Tennessee-Tombigbee Waterway on September 8, 2019. Plaintiffs, Savage Services Corporation and Savage Inland Marine, LLC (collectively "Savage"), owned and operated the inland towing vessel, M/V SAVAGE VOYAGER (the "Vessel"). (Doc. 39, ¶ 7.) On the day in question, the Vessel was pushing ahead two tank barges, including PBL 3422 (the "Barge"), entering the Jamie Whitten Lock (the "Lock"). (Id. , ¶ 8.) The United States Army Corps of Engineers ("USACOE") was responsible for operating the Lock at that time. (Id. , ¶ 2.)

Savage maintains that the lock master "began de-watering the lock chamber without notice or warning to the crew," without confirming that the tug and tow were within the miter walls, and without checking the mooring lines. (Id. , ¶ 10.) As a result, plaintiffs allege, the rake end of the Barge became caught on the north miter wall of the Lock. (Id. , ¶ 11.) Upon becoming apprised of the problem, the lock master was unable to stop the descent; therefore, the water level continued to descend, with the Barge eventually falling off the north miter wall. (Id. , ¶¶ 11-12.) The Barge's cargo tank was punctured, releasing crude oil into the lock chamber. (Id. , ¶ 13.) According to the Amended Complaint, Savage's litigation position is that the Barge damage "and resulting release of crude oil into the lock were caused solely and completely by the fault, neglect and lack of due care of the United States, through its agency, the USACOE," in various enumerated respects. (Id. , ¶ 18.) Plaintiffs insist that "[t]here was nothing the SAVAGE VOYAGER or her crew did or could have done to cause or contribute to this accident." (Id. , ¶ 20.) Savage goes on to allege that as a result of the USACOE's negligence, Savage suffered damages exceeding $4 million, the overwhelming majority of which took the form of "[e]nvironmental cleanup costs." (Id. , ¶ 21.) In other words, Savage was required to bear the initial expense of cleaning up the oil spill in the Lock. The central tenet of Savage's Amended Complaint is that the oil spill, and the resulting expenses incurred by Savage, were solely attributable to the lock master's negligence, for which the Government may be held liable.

On the basis of these and other factual allegations and legal theories, Savage brings claims against the United States for damages pursuant to the Suits in Admiralty Act, 46 U.S.C. §§ 30901 et seq. ("SAA"), and the Federal Tort Claims Act, 28 U.S.C. § 1346 ("FTCA").

In response to the Amended Complaint, the United States filed a Partial Motion to Dismiss. In that Motion, defendant sets forth the following arguments: (i) the Oil Pollution Act of 1990, 33 U.S.C. §§ 2701 et seq. ("OPA"), does not allow the Government to be construed as a sole-fault third party, so a responsible party like Savage remains exclusively and wholly liable for oil-spill removal costs; (ii) the OPA does not permit a responsible party like Savage to bring a claim for contribution against the Government for oil-spill removal costs in a comparative fault context; and (iii) Savage cannot bring its claims against the Government under the FTCA because this is an admiralty case, such that the FTCA waiver of sovereign immunity has no permissible application here. (Doc. 50.) As a matter of well-settled law, in order to bring its claims against the Government, Savage must be able to identify an applicable waiver of sovereign immunity.² Defendant's position in the Motion to Dismiss is that no such waiver exists as to plaintiff's claim for recovery of oil-spill removal costs, although there is such a waiver in effect for other aspects of plaintiff's claim. Savage disagrees, and filed its own Motion for Partial Summary Judgment in order to obtain a definitive resolution of that narrow legal question. Each side has now been afforded a full and fair opportunity to be heard on what appears to be an issue of first impression. The parties have not identified a single decisional authority that is directly on point, nor has this Court's independent research located any such rulings.

II. Analysis.

A. Application of the SAA's Sovereign Immunity Waiver.

1. The SAA's Sovereign Immunity Waiver.

As noted, Savage principally hangs its jurisdictional hat on the waiver of sovereign immunity contained in the Suits in Admiralty Act.³ The critical statutory language reads as follows:

"In a case in which ... if a private person or property were involved, a civil action in admiralty could be maintained, a civil action in admiralty in personam may be brought against the United States or a federally-owned corporation."

46 U.S.C. § 30903(a). The Supreme Court has observed generally that the SAA "contains a broad waiver of sovereign immunity." Henderson v. United States , 517 U.S. 654, 665, 116 S.Ct. 1638, 134 L.Ed.2d 880 (1996) ; see also Gordon v. Lykes Bros. S.S. Co. , 835 F.2d 96, 98 (5th Cir. 1988) ("In effect, the SAA is a jurisdictional statute providing for maintenance of admiralty suits against the United States which encompasses all maritime torts alleged against the United States."). Everyone agrees that if the circumstances described in the Amended Complaint involved a private person or property, Savage could maintain a civil action in admiralty; therefore, the SAA would appear on its face to confer the requisite waiver to enable Savage to maintain this admiralty action against the United States.⁴

Defendant's concurrence that such a waiver of sovereign immunity exists for Savage's claims under the SAA is accompanied by a glaring caveat. According to the United States, "[a]part from its removal cost claim , Savage correctly identifies the SAA as waiving sovereign immunity." (Doc. 50, PageID.227 (emphasis added).) It is undisputed, then, that Savage may proceed under the SAA with all of its non-removal cost claims against the United States in this action. However, the removal cost claim is, by all appearances, the tail that wags the dog here. Information presented by the parties suggests that of the more than $4 million in damages claimed by Savage, in excess of $3 million consists of oil removal / environmental cleanup costs, with the roughly $1 million remainder attributable to categories of loss such as barge repair, lost cargo, demurrage, civil penalties and travel expenses. (Doc. 50, PageID.208; doc. 39, ¶ 21, PageID.170.) By plaintiffs’ own reckoning, "Savage paid more than $3 million to clean the Lock and ... restored the environment to its pre-spill condition. Now, Savage is entitled to recover its costs under the Suits in Admiralty Act from the party whose negligence caused the Accident in the first place, the United States." (Doc. 54, PageID.277-78.)

2. The Oil Pollution Act Framework.

The United States’ position, however, is that the SAA waiver of sovereign immunity governing Savage's claims for recovery of other forms of damage from the accident does not reach the oil removal / environmental cleanup cost category of Savage's damages. In the United States’ view, this result flows directly from the passage of the Oil Pollution Act of 1990, 33 U.S.C. §§ 2701 et seq. (the "OPA"). Enacted in the aftermath of the Exxon Valdez disaster, "[t]he OPA is Congress's effort to streamline federal law so as to provide quick and efficient cleanup of oil spills, compensate victims of such spills, and internalize the costs of spills within the petroleum industry." In re Settoon Towing, L.L.C. , 859 F.3d 340, 344 (5th Cir. 2017) (citation and internal quotation marks omitted). To "facilitate[ ] prompt cleanup and compensation," the OPA requires a responsible party – which in the case of a vessel is "any person owning, operating, or demise chartering the vessel" – to be "strictly liable for cleanup costs and damages and first in line to pay any claims for removal costs or damages that may arise under OPA." Id. (citations omitted). Thus, when Savage paid upfront for the oil-spill cleanup costs at the Lock, it did so pursuant to its status under the OPA as a responsible party (i.e. , operator of the Barge) at the time of the spill.⁵

The issue then becomes whether and under what circumstances Savage can recover the oil-spill cleanup costs it paid as a responsible party if the United States or its agent (i.e. , the USACOE, the lock master) was wholly or partially at fault. The Government emphasizes that the OPA repealed a provision of a predecessor statute, the Federal Water Pollution Control Act Amendments of 1972 (the "FWPCA"), that expressly allowed vessel owners/operators to recover reasonable costs of oil removal from the United States when "such discharge was caused solely by ... (C) negligence on the part of the United States Government." 33 U.S.C. §...