Trail Marine LLC v. Tex. Petroleum Inv. Co.
| Decision Date | 28 October 2022 |
| Docket Number | 6:22-CV-02050 |
| Parties | TRAIL MARINE LLC v. TEXAS PETROLEUM INVESTMENT CO |
| Court | U.S. District Court — Western District of Louisiana |
REPORT AND RECOMMENDATION
Before the Court is the Motion to Dismiss pursuant F.R.C.P. Rule 12(b)(6) filed by Defendant, Texas Petroleum Investment Company (“TPIC”). (Rec. Doc. 7). Plaintiff, Trail Marine, LLC opposed the Motion (Rec. Doc. 9), and TPIC replied (Rec. Doc. 12). The Motion was referred to the undersigned magistrate judge for review, report, and recommendation in accordance with the provisions of 28 U.S.C §636 and the standing orders of this Court. Considering the evidence, the law, and the arguments of the parties, and for the reasons explained below, the Court recommends that TPIC's Motion be granted in part and denied in part.
Trail Marine filed this admiralty and maritime claim in July 2022 for the loss of its commercial vessel, the TM-3. Trail Marine alleges that, pursuant to a bareboat charter agreement, Trail Marine chartered the TM-3 to TPIC in January 2015. According to the terms of the charter agreement, TPIC agreed to insure the TM-3 and to return it in good condition upon completion of the contract. (Rec. Doc. 1, ¶VII; XI). Trail Marine alleges that the TM-3 was severely damaged on October 15, 2015 while chartered to TPIC, that it was later salvaged by a third party, and that the vessel was a total loss. (Rec. Doc. 1, ¶XIII). Trail Marine filed this suit to recover for the loss of the TM-3 due to TPIC's failure to insure the vessel, failure to return it in good condition, and for breach of contract damages. (Rec Doc. 1, ¶XIV-XXIII).
TPIC filed the instant motion to dismiss Trail Marine's complaint on the grounds that Trail Marine's claims are precluded by its failure to file a compulsory claim in either of two limitation actions filed in 2016 as a result of the incident. TPIC filed the first limitation of liability action pursuant to 46 U.S.C. §30501 et seq and Rule F of the Supplemental Rules for Admiralty and Maritime Claims in March 2016. (In Re: Texas Petroleum Investment Co., 2:16-CV-00355 (“In Re: TPIC”). In that action, TPIC described the October 2015 incident involving the TM-3 as an explosion in which two workers were killed and the vessel was destroyed. (In Re TPIC, Doc. 1). On May 24, 2016, the court in In Re: TPIC ordered that a Monition be issued to all persons claiming damages for any and all losses, destruction, damage, injury or death resulting from the incident, and that such persons file their claims by July 1, 2016.[1] (In Re: TPIC, Doc. 4). Trail Yamaha Service Center, LLC,[2] against whom one decedent's family had filed suit in state court, filed an answer to TPIC's limitation action seeking to limit claims against it arising out of the incident. (In Re: TPIC, Doc. 8). In July 2016, TPIC moved for default judgment against those parties who had not asserted claims. On July 27, 2016, the court entered the following default judgment:
HEREBY ORDERS, ADJUDGES, AND DECRESS: any and all parties that did not enter a claim in Texas Petroleum Investment Company's limitation proceeding as docketed above, is hereby in default and enjoined from entering a claim against Texas Petroleum Investment Company arising out of or in connection with the alleged incident that took place on or about October 15, 2015 at Texas Petroleum Investment Company's White Lake facility in Louisiana.
(In Re: TPIC, Doc. 30).
Trail Marine did not file a claim in In Re: TPIC. Instead, on September 13, 2016, Trail Marine filed a subsequent limitation of liability action. (In Re: Trail Marine, LLC, 2:16-CV-01282). The two limitation actions were consolidated into In Re: TPIC, and TPIC filed a claim for contribution and indemnity in Trail Marine's action. (In Re: TPIC, Doc. 54; 58). Trail Marine did not answer TPIC's claim or file a counterclaim against it; however, Trail Marine stated in the parties' Rule 26(f) report that it reserved the right to assert third-party demands against insurers that were obligated to name it as additional insured pursuant to its charter agreement with TPIC and, alternatively, against TPIC for breach of contract if Trail Marine was not named as additional insured. ). Trail Marine never moved to assert such claims against TPIC or any of its insurers. TPIC now urges the Court to dismiss Trail Marine's claims for failing to assert its claims in either of the two limitation actions. Trail Marine contends that the personal contract doctrine allows it to proceed against TPIC outside the limitation proceedings.
When considering a motion to dismiss for failure to state a claim under F.R.C.P. Rule 12(b)(6), the court must limit itself to the contents of the pleadings, including any attachments and exhibits thereto. Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498 (5th Cir.2000); U.S. ex rel. Riley v. St. Luke's Episcopal Hosp., 355 F.3d 370, 375 (5th Cir.2004). The court must accept all well-pleaded facts as true and view them in the light most favorable to the plaintiff. In re Katrina Canal Breaches Litigation, 495 F.3d 191, 205 (5th Cir.2007) (internal quotations omitted) (quoting Martin K. Eby Constr. Co. v. Dallas Area Rapid Transit, 369 F.3d 464, 467 (5th Cir.2004)); Baker v. Putnal, 75 F.3d 190, 196 (5th Cir.1996). Conclusory allegations and unwarranted deductions of fact are not accepted as true, Kaiser Aluminum & Chemical Sales v. Avondale Shipyards, 677 F.2d 1045, 1050 (5th Cir. 1982) (citing Associated Builders, Inc. v. Alabama Power Company, 505 F.2d 97, 100 (5th Cir. 1974)); Collins v. Morgan Stanley, 224 F.3d at 498. To survive a Rule 12(b)(6) motion, the plaintiff must plead “enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic, 127 U.S. at 570. The allegations must be sufficient “to raise a right to relief above the speculative level,” and “the pleading must contain something more . . . than . . . a statement of facts that merely creates a suspicion [of] a legally cognizable right of action.” Id. at 555 (quoting 5 C. Wright & A. Miller, Federal Practice and Procedure § 1216, pp. 235-36 (3d ed. 2004)).
Ordinarily, in ruling on a Rule 12(b)(6) motion, the Court is limited to the allegations of the complaint and any exhibits attached thereto; however, the court may also consider documents attached to the defendant's motion if they are referenced in the complaint and central to the plaintiff's claims. In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007). The Court is also permitted to take judicial notice of public records as well as facts which are not subject to reasonable dispute in that they are either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. Funk v. Stryker Corp., 631 F.3d 777, 783 (5th Cir. 2011). In addition to consideration of the Complaint and the charter agreement attached thereto, the Court shall take judicial notice of the In Re: TPIC and In Re: Trail Marine proceedings as matters of public record.
TPIC first seeks to dismiss Trail Marine's claims as precluded under the doctrine of res judicata. The Fifth Circuit explained claim preclusion as follows:
The rule of res judicata encompasses two separate but linked preclusive doctrines: (1) true res judicata or claim preclusion and (2) collateral estoppel or issue preclusion. ... Claim preclusion bars the litigation of claims that have been or should have been raised in an earlier suit. The test for claim preclusion has four elements: (1) the parties are identical or in privity; (2) the judgment in the prior action was rendered by a court of competent jurisdiction; (3) the prior action was concluded by a final judgment on the merits; and (4) the same claim or cause of action was involved in both actions.
Students for Fair Admissions, Inc. v. Univ. of Texas at Austin, 37 F.4th 1078, 1087 (5th Cir. 2022) (cleaned up).
It is undisputed that 1) the parties, Trail Marine and TPIC, are identical in this case and in the limitation actions; and that 2) the prior judgment of default was rendered by a court of competent jurisdiction. Trail Marine disputes that the default judgment applies to Trail Marine's claims because its claims arise from a personal contract, which Trail Marine contends are not subject to limitation under the personal contract doctrine. Trail Marine further argues its claims for breach of the charter agreement do not arise out of the same transaction or occurrence as the claims required to have been brought in the limitation proceedings.
Trail Marine first relies on the personal contract doctrine for the proposition that its claims against TPIC arise out of a personal contract and are thus legally excused from compulsory claims in limitation proceedings. The analysis begins with the Limitation of Liability Act, which provides that “the liability of the owner of a vessel for any claim, debt, or liability ... arising from ... any act matter, or thing, loss, damage, or forfeiture, done, occasioned, or incurred, without the privity or knowledge of the owner . shall not exceed the value of the vessel and pending freight.” 46 U.S.C. § 30505(a)-(b); SCF Waxier Marine, L.L.C. v. Aris TM/V, 24 F.4th 458, 472 (5th Cir. 2022). In cases involving a bareboat charter agreement, the...
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