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From Products Liability Law Daily, July 10, 2014

Punitive damages available to seaman, not survivors, for asbestos-related injuries

By Pamela C. Maloney, J.D.

Punitive damages are available to injured seamen in an action based upon the doctrine of unseaworthiness arising out of asbestos related injuries, a federal district court in Pennsylvania determined, addressing issues of first impression in the circuit. However, personal representatives of seamen who died from asbestos-related injuries could not recover punitive damages in an unseaworthiness wrongful death or survival actions. The court further determined that punitive damages awards were subject to limitations under the Due Process Clause and in conformity with maritime law (In re: Asbestos Products Liability Litigation (No. VI); Sanchez v. Various Defendants, July 9, 2014, Robreno, E.).

Background. The question of the availability of punitive damages arose in a consolidated asbestos products liability multidistrict litigation pending in the U.S. District Court for the Eastern District of Pennsylvania. The plaintiffs include merchant marines and their representatives, survivors, and spouses while the defendants are shipowners. The shipowners moved for partial summary judgment with respect to all claims for punitive damages.

General maritime law. The court began its analysis by reviewing the history of general maritime law which recognizes two causes of action that seamen may bring against their employers—the shipowners. The first is a claim for maintenance and cure if the shipowner breached its duty to provide food, lodging, and medical services. The second is a claim of unseaworthiness for injuries sustained as a consequence of the unseaworthiness of the ship or a defect in the ship’s equipment. There was no recognized cause of action for injuries caused by a shipowner’s negligence, and there were wrongful death or survival actions. However, punitive damages were recoverable for wanton, willful, or outrageous conduct.

In 1920, Congress passed the Jones Act which granted seaman a federal cause of action for employer negligence and allowed a seaman’s personal representative to bring an action against the shipowner based on the latter’s negligence. In that same year, the Death on the High Seas Act (DOHSA) was passed, which extended that remedy to survivors of all person’s seamen and non-seamen, killed on the high seas by a wrongful act or negligence. Both these acts limited recover to pecuniary losses; however, neither of them disturbed seamen’s general maritime claims for injuries resulting from unseaworthiness or maintenance and cure claims. As a result, general maritime law and these federal statutes now act in tandem to provide separate yet overlapping avenues of relief for injured seamen. This overlap created gaps, two of which were relevant to the case at hand, the court explained.

Issues created by overlap between federal and maritime law. The first issue raised by the overlap between the federal statutes and general maritime law was whether the legislatively-created wrongful death and survival actions should be permitted under general maritime law. Pointing to the U.S. Supreme Court’s uniformity principle as defined in Miles v. Apex Marine Corp., 498 U.S. 19, 25 (1990), the court concluded that to “eliminate anomalies and ‘assure uniform vindication of federal policies’…” a seaman’s survivors should be permitted to bring a wrongful death action under general maritime law.

The second question raised by the overlap was whether the statutory limitation on available remedies (the restriction to only pecuniary damages) also applied to general maritime law. Reasoning that punitive damages are non-pecuniary and, thus, impermissible under the Jones Act, many courts have concluded that the Miles uniformity principle prevents recovery of punitive damages under general maritime law in both wrongful death actions and in those brought directly by an injured seaman. However, in Atlantic Sounding Co. v. Townsend, 557 U.S. 404 (2009), the U.S. Supreme held that punitive damages were available in a general maritime claim for maintenance and cure, reasoning that punitive damages were historically available for claims arising under federal maritime law. The High Court distinguished its holding in Miles stating that it barred the creation of new “common law” remedies that exceeded those remedies statutorily available under the Jones Act and DOHSA.

Based on the holding in Atlantic Sounding, it was settled law that a seaman could recover punitive damages in an action based on the doctrine of maintenance and cure. It was also settled law that as a general matter, federal courts retain authority to develop and expand general maritime law principles except in areas in which Congress has spoken directly.

Punitive damages in unseaworthiness claims. Against this backdrop, the court was left to resolve whether an injured seaman could recover punitive damages in an action based on the doctrine of unseaworthiness and, if so, could the seaman’s personal representative recover those damages in an unseaworthiness survival action. Agreeing with the plaintiffs, the court recognized that unseaworthiness claims, which predated the Jones Act, historically permitted punitive damages awards and that the Jones Act preserved common law causes of actions and their remedies. Because it was feasible for courts to allow punitive damages in seaworthiness actions as they did at common law without violating the Jones or contradicting the Supreme Court’s holding in Miles, the court determined that punitive damages may be awarded in a general maritime claim of unseaworthiness.

Punitive damages in survival claims. However, survival actions are an entirely different matter, as was made clear in Atlantic Sounding, which held that remedies available in wrongful death actions are limited to those available under the Jones Act. Although the plaintiffs argued that the estate of a seaman who died from injuries caused by the unseaworthiness of his vessel should not be barred from recovering damages to which the seaman was entitled. According to the court, however anomalous it would be to permit an injured seaman to recover punitive damages but not to allow his estate to recover those same damages, that same anomaly existed at common law and is exactly the result required by Supreme Court precedent, the court concluded. Thus, the shipowners’ motion for summary judgment was granted as to all plaintiffs seeking punitive damages in wrongful death or survival actions.

Punitive damages in asbestos-related claims. The question remained as to whether punitive damages were appropriate in the context of asbestos cases. Noting that the many critics believed that the dual purposes of retribution and deterrence are ill-served in the context of asbestos claims because of the long latency period and the unavailability of the original manufacturers due to bankruptcy and/or dissolution, the court nonetheless refused to declare that punitive damages were barred in all asbestos cases. The court noted that despite the persuasiveness of the arguments against allowing punitive damages awards in asbestos cases, they did not provide a strong doctrinal foundation to support a judicial ban. While it was true that punitive damages awarded today were unlikely to punish the correct actor because the relevant players have changed, a punitive damages award still could deter future willful or reckless conduct regarding a different risky product. Furthermore, there are virtually no cases in which a federal court barred punitive damages solely on the basis that the rationales for punitive damages are no longer applicable in asbestos cases.

Deciding that punitive damages were available in general maritime law claims arising out of asbestos-related injuries, the court cautioned that these awards are subject to both federal due process limitations and the standards articulated under maritime law.

Adequacy of pleading. After examining the pleadings in light of its findings that punitive damages were available under general maritime law in situations in which a defendant’s conduct could be characterized as outrageous because of gross negligence, willful, wanton, and reckless indifference for the rights of others, the court found that most of the complaints failed to meet federal pleading standards. According to the court, the complaints did not include any factual allegations to support their allegations that the shipowners maintained their ships in an unseaworthy condition with reckless indifference to and disregard for the safety of the seamen. While this finding ordinarily would be enough to dismiss the complaints, the court granted the seaman leave to amend their complaints because they were filed before the Supreme Court redefined the federal pleading standards.

The case number is MDL Docket No. 875.

Attorneys: Donald A. Krispin (The Jaques Admiralty Law Firm, PC), and Vincent A. Colianni (Colianni & Colianni LLC) for plaintiffs. George F. Fitzpatrick, Jr. (Swanson, Martin & Bell) for Coffin Turbo Pump, Inc. William J. Krueger (Baughman and Associates) for Ingalls Shipbuilding, Inc. Kevin O. Kadlec (Bonezzi, Switzer, Murphy & Polito Co., LPA), and Stephen J. Imbriglia (Gibbons PC) for Chicago Tube & Iron Co., Clayton Manufacturing, and Cummings Manufacturing.

Companies: Coffin Turbo Pump, Inc.; Ingalls Shipbuilding, Inc.; Chicago Tube & Iron Co.; Clayton Manufacturing; Cummings Manufacturing

MainStory: TopStory DamagesNews AsbestosNews PennsylvaniaNews

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