U.S. Fifth Circuit Affirms $20 Million Judgment Against Barge Owner as Responsible Party Under the Oil Pollution Act of 1990

Case:     United States v. American Commercial Lines, L.L.C., No. 16-31150, ___ F.3d ___ (5th Cir. 11/7/17).

Factual Background

In July of 2008, nearly 300,000 gallons of oil spilled into the Mississippi River in New Orleans when a tugboat towing an oil-filled barge veered across the river into the path of an ocean-going tanker.  American Commercial Lines (“ACL”) owned the tug MEL OLIVER, and bareboat chartered its tug to DRD Towing.  DRD then operated the MEL OLIVER under a time charter to ACL.  At the time of the collision, the MEL OLIVER, which was pushing ACL’s barge DM-932 fully laden with oil, was operating without a captain who had effectively abandoned the vessel several days earlier.  The Steersman left in charge was allegedly sound asleep at the wheel at the time of the collision as he had been working for nearly 36 straight hours.  The TINTOMARA, a tanker, collided with the DM-932, causing the barge to break away and ultimately sink in the Mississippi River resulting in the spill of approximately 300,000 gallons of oil into the River.  As owner of the leaking barge, ACL was deemed the responsible party under the Oil Pollution Act of 1990 (“OPA ’90”). Continue Reading

Third Circuit Affirms Trial Court’s Refusal to Adopt DNR’s Most Feasible Plan in Sweet Lake Land & Oil Co. v. Oleum Operating Company

The Louisiana Legislature passed “Act 312,” La. R.S. 30:29, in 2006 to provide a procedure for ensuring that amounts awarded to remediate environmental damage are actually spent on remediation.  Act 312 sets forth a multi-step scheme that is triggered once a party is found responsible for environmental damage, culminating with Department of Natural Resources (“DNR”) approving a plan “to evaluate or remediate” the environmental damage. La. R.S. 30:29(C)(2)(a). Thereafter the trial court “shall adopt the plan approved by the [DNR] unless another party proves by a preponderance of the evidence that another plan is more feasible,” id. 30:29(C)(5).  Continue Reading

Louisiana Supreme Court Holds Punitive Damages Are Available Under General Maritime Law Against Products Liability Defendant

Case:  Warren v. Shelter Mutual Ins. Co., No. 2016-C-1647 (La. 10/18/17), ___ So. 3d ___.

Factual Background

A recreational boating accident occurred on navigable inland waters of Louisiana in May of 2005 resulting in the death of a 22-year old passenger. While the boat was on plane, the hydraulic steering system manufactured by defendant Teleflex suddenly failed due to fluid loss, causing the boat to turn violently with the motor going into a free spin (known in the industry as a “J-hook” or “kill spin”). Decedent and other passengers were ejected from the boat, and thereafter, the boat continued to spin around with its propeller striking decedent 19 times, resulting in death.

Decedent’s parents[1] filed suit under general maritime law and products liability for the wrongful death of their son, and sought punitive damages under the general maritime law. Their claims against Teleflex, a sophisticated boating industry manufacturer, centered on its failure to warn unsuspecting users of the inherent danger in its product—that a very small loss of fluid would result in loss of steering and potentially cause ejection and death.

Following trial,[2] the jury rendered a verdict in favor of the Plaintiff and against Teleflex for failure to warn, awarding compensatory damages of $125,000 and punitive damages of $23 million. Teleflex appealed the verdict, and the Louisiana Third Circuit Court of Appeal affirmed. Continue Reading

Plaintiffs and Defendants Jointly Choose First Cases for Trial in Plaquemines Parish Coastal Zone Management Act Litigation

The first five Plaquemines Parish Coastal Zone Management Act (“CZMA”) cases to be set for trial have been chosen. The Plaintiffs selected Parish of Plaquemines v. Rozel Operating Company, et al., Parish of Plaquemines v. ConocoPhillips Company, et al., and Parish of Plaquemines v. Hilcorp Energy Company, et al.  The Defendants picked Parish of Plaquemines v. Equitable Petroleum Corporation, et al. and Parish of Plaquemines v. Helis Oil & Gas Company, LLC, et alContinue Reading

The Fifth Circuit Rejects the DOJ’s Attempt to Charge Black Elk Contractors with OCSLA Felonies

In the aftermath of a 2012 platform explosion in the Gulf of Mexico in which three workers were killed, the Department of Justice ultimately indicted the contractors who supervised the work (along with the lease holder, Black Elk Energy Offshore Operations, LLC) with violating the Outer Continental Shelf Land Act (“OCSLA”), a felony carrying a maximum penalty of up to ten years imprisonment.  The contractors were also charged with certain misdemeanor Clean Water Act violations.  The contractors moved to dismiss the OCSLA charges on the basis that their conduct – as contractors – was not covered by OCSLA because they were not the lease holder or operator.  The district court agreed and dismissed those charges, after which the government appealed.  Earlier this week, the Fifth Circuit ruled against the government finding that contractors cannot criminally violate these OCSLA regulations.  United States v. Moss, et al, No. 16-30561 (5th Cir. Sept. 27, 2017).

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False Claims Act Relators Be Warned: Rule 54’s Taxable Costs Award Lies Ahead for the Overeager Relator

In a published opinion last week, the Fifth Circuit sent a reminder to would-be False Claims Act (“FCA”) relators that they better think carefully before filing suit because while they may be seeking treble damages, they may ultimately be held liable for significant taxable costs should their complaint fail to survive summary judgment. Continue Reading

SEC Publishes New Guidance on Investment Adviser Advertising

The SEC published new guidance on RIA advertising yesterday in a National Exam Program Risk Alert dated September 14, 2017 (https://www.sec.gov/ocie/Article/risk-alert-advertising.pdf).  The Risk Alert is entitled “The Most Frequent Advertising Rule Compliance Issues Identified in OCIE Examinations of Investment Advisers.”  This is particularly important because the SEC is focusing on marketing materials in its latest exam cycle.  In the Risk Alert, the SEC highlights common errors made by advisers in their marketing and advertising materials. Continue Reading

The Fifth Circuit’s Decision in In Re: DePuy Orthopaedics, Inc., et al, Illustrates the Possibility that Even When You Lose a Writ of Mandamus, You May Still Win

Faced with the prospect of having to defend another costly test-case trial in a multidistrict litigation proceeding involving over 9,000 plaintiffs, the defendants (petitioners before the Court of Appeals) filed a writ of mandamus challenging the district court’s decision that they waived their jurisdictional and venue objections (known as a Lexecon waiver).  Had the Court of Appeals granted the writ, the district court’s decision would have been reversed and the upcoming test-case trial would have been stopped for lack of jurisdiction and venue.  While the Court ultimately denied the writ, it did so in a way that advanced the defendants’ case.  In re: DePuy Orthopaedics, Inc., No. 17-10812 (5th Cir. Aug. 31, 2017). Continue Reading

IRS Announces Plan Loans, Hardship Distributions Relief For Victims Of Hurricane Harvey

On August 30, 2017, in Announcement 2017-11, the IRS provided retirement plan loan and distribution relief from retirement plans described in Code Sections 401(a) (including 401(k) plans), 403(a), 403(b), and governmental eligible deferred compensation plans described in 457(b) (collectively “Retirement Plans”) to affected participants. Continue Reading

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