United States v. Bros. Enters., Inc.
| Decision Date | 30 June 2015 |
| Docket Number | CIVIL ACTION NO. 1:13–CV–17 |
| Parties | United States of America, Plaintiff, v. Brothers Enterprises, Inc., Continental Insurance Company, Tom's Welding, Inc., and Leesboro Corporation, Defendants. |
| Court | U.S. District Court — Eastern District of Texas |
Edmund Ferguson, Matthew Joseph Mailloux, Gary Charles Murphy, U. S. Department of Justice–Torts, Aviation & Admiralty, Washington, DC, Andrea Hedrick Parker, Beaumont, TX, for Plaintiff.
Candace A. Ourso, Hall Maines Lugrin, PC, Houston, TX, Frank J. Dantone, Edward D. Lamar, Henderson Dantone, P.A., Greenville, MS, Jonathan B. Andry, Michelle C. Purchner, Vionne M. Douglas, Andry Law Group LLC, New Orleans, LA, Karen Renee Bennett, Germer Gertz, Beaumont, TX, for Defendants.
The government is suing Defendants Brothers Enterprises, Inc., ("Brothers"), Tom's Welding, Inc. ("Welding"), and Leesboro Corporation ("Leesboro") for violations of the Oil Pollution Act ("OPA"), 33 U.S.C. §§ 2701 –2761.1 Pending before the court are the government's motion for summary judgment (# 107) against Brothers and Welding and Brothers's cross-motion for summary judgment (# 112) against the government. Having considered the motions, the submissions of the parties, the pleadings, and the applicable law, the court is of the opinion that both motions should be denied.
This lawsuit involves the cleanup of an oil spill emanating from the oil barge DIA–1A (the "Barge") into waters near Orange, Texas. Brothers purchased the Barge at a United States Marshal's sale on April 23, 2008. The double-hulled Barge was built in 1975 and had a 23,735 barrel cargo capacity. After Hurricane Ike struck the Texas coast on September 13, 2008, the Barge, which contained both an "oil/water solution" and "asphaltene,"2 became grounded on wetlands adjoining a tributary to the Sabine River near Orange, Texas. Brothers subsequently hired a marine surveyor, Mark Shiffer ("Shiffer"), owner of Mark Shiffer Surveyors, Inc. ("MSS"), to assess the Barge's condition.
In his initial report, submitted on September 20, 2008, Shiffer noted:
On an unspecified date shortly after submitting his initial report, Shiffer learned that the Barge was resting on top of gas pipelines, some of which were identified as "high pressure." At deposition, Shiffer stated that upon discovering that the Barge was "sitting" on top of the pipelines, he became concerned and recommended that the Barge "needed to be moved" because it "presented a danger." Brothers thereafter directed MSS to solicit bids from companies that could remove the Barge from its beached location. Coral Marine Services, L.L.C., ("Coral"), a company specializing in salvage and recovery operations, was ultimately selected. Coral arrived on site on November 7, 2008, with a 250–ton salvage derrick barge and a small towboat. After a week of operations, however, Coral abandoned its removal efforts "due to [the] dangerous proximity to underground pipe lines."
Tom Khai Dinh ("Dinh"), a co-owner of Welding, thereafter approached Brothers and submitted a removal bid. Welding's initial bid, which acknowledged that the Barge was located "on top of 3 gas line[s]," was submitted on December 12, 2008. On December 27, 2008, Welding submitted a revised bid, again stating, "[w]e understand that the Barge is on top of the 3 pipe line[s]," and adding that "[Welding] will take full responsibility of any damage while remov[ing] the Barge." On December 30, 2008, Welding signed a wreck removal agreement with Brothers and thereafter became the sole owner of the Barge.
Welding's initial removal plan was to use two "heavy pull winches" to pull the Barge off the beach while injecting a biodegradable soap to "break suction and aid in minimizing friction in the dragging process." Once that plan proved unsuccessful (the Barge moved only three inches), Welding turned to its "Plan B"—a proposed cutting up of the Barge into two parts, each of which would purportedly have been light enough to pull off the bank. According to Dinh, the Barge would "never sink because it's got a self-container." Dinh apparently tried to obtain approval from the United States Coast Guard for this salvage plan on three separate occasions, but the requests were denied because they lacked specificity. In the meantime, the Coast Guard reportedly warned Welding "not to do any cutting up on [the] Barge without having an approved salvage plan."
Once Dinh realized that any future recovery operations with Coast Guard approval would be cost prohibitive, he attempted to sell the Barge to another buyer. On September 2, 2009, Dinh sold the Barge to Yung Lee ("Lee"), a scrap dealer and the owner of Leesboro Corporation, for $1.00.3 On October 8, 2009, the United States Coast Guard discovered oil discharge from the Barge into the Sabine River and sent Welding an Administrative Order stating:
On October 8, 2009, personnel from our office conducted an investigation into a salvage operation at the Port of Orange in Orange, TX which involved the removal of approximately 20,000 gallons of number six oil from the barge DIA–1A. During the investigation, the Coast Guard discovered the following; an oil discharge into the Sabine River originating from the barge DIA–1A, improper disposal of waste materials, lack of an environmental response plan, and failure to comply with the previously approved salvage plans.
In response to the spill, which purportedly released more than 110,000 gallons of oily water and 34,400 gallons of heavy oil into the Sabine River, the Coast Guard launched a cleanup operation that included spill management, roadway construction, oil product extraction, staging area development, and steel removal. According to the government, these cleanup efforts continued through at least March 17, 2010, and cost approximately $1,315,620.85.
In its instant motion for summary judgment, the government argues that there are no genuine issues of material fact that Brothers and Welding violated OPA because they were both "responsible parties" when the Barge's grounding created a "substantial threat of a discharge." In its cross-motion for summary judgment, Brothers argues as a matter of law that it (1) could not have been a "responsible party" because it did not own the Barge at the time of the oil discharge, and (2) the Barge's grounding on top of gas pipelines did not create a "substantial threat of a discharge."4 Welding's response to the government's motion for summary judgment essentially mirrors the arguments set forth by Brothers.
Rule 56(a) of the Federal Rules of Civil Procedure provides that summary judgment shall 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." FED. R. CIV. P. 56(a). The parties seeking summary judgment bear the initial burden of informing the court of the basis for their motion and identifying those portions of the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits, if any, which they believe demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ; Technical Automation Servs. Corp. v. Liberty Surplus Ins. Corp., 673 F.3d 399, 407 (5th Cir.2012) ; QBE Ins. Corp. v. Brown & Mitchell, Inc., 591 F.3d 439, 442 (5th Cir.2009). Where "the movant bears the burden of proof on an issue, either because he is the plaintiff or as a defendant he is asserting an affirmative defense, he must establish beyond peradventure all of the essential elements of the claim or defense to warrant judgment in his favor." Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir.1986) (emphasis in original); see Addicks Servs., Inc. v. GGP–Bridgeland, LP, 596 F.3d 286, 293 (5th Cir.2010) ; Martin v. Alamo Cmty. Coll. Dist., 353 F.3d 409, 412 (5th Cir.2003) ; Chaplin v. NationsCredit Corp., 307 F.3d 368, 372 (5th Cir.2002).
"A fact is material only if its resolution would affect the outcome of the action...." Wiley v. State Farm Fire & Cas. Co., 585 F.3d 206, 210 (5th Cir.2009) ; accord Poole v. City of Shreveport, 691 F.3d 624, 627 (5th Cir.2012) ; Cooper Tire & Rubber Co. v. Farese, 423 F.3d 446, 454 (5th Cir.2005). " ‘Factual disputes that are irrelevant or unnecessary will not be counted.’ " Tiblier v. Dlabal, 743 F.3d 1004, 1007 (5th Cir.2014) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). "An issue is ‘genuine ’ if it is real and substantial, as opposed to merely formal, pretended, or a sham." Bazan ex rel. Bazan v. Hidalgo Cnty., 246 F.3d 481, 489 (5th Cir.2001) (emphasis in original). Thus, a genuine issue of material fact exists "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248, 106 S.Ct. 2505 ; accord Poole, 691 F.3d at 627 ; Bayle v. Allstate Ins. Co., 615 F.3d 350, 355 (5th Cir.2010) ; Wiley, 585 F.3d at 210.
Once a proper motion has been made, the nonmoving parties may not rest upon mere allegations or denials...
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