Mardi Gras World, L.L.C. v. Marquette Transportation Company Gulf-Inland, LLC

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

MARDI GRAS WORLD, LLC, ET AL. CIVIL ACTION

VERSUS NO. 18-4745 C/W 18-5579

MARQUETTE TRANSPORTATION SECTION “R” (2)

CO., ET AL.

ORDER AND REASONS

Before the Court is the motion for partial summary judgment from

defendants Marquette Transportation Company Gulf-Inland, LLC, and

Marquette Transportation Company, LLC (collectively, “Marquette”), on the

claims for economic loss damages from plaintiff Mardi Gras World, LLC

(“Mardi Gras World”).1 Because Mardi Gras World has a proprietary interest

in the damaged property, the defendants’ motion is denied.

I. BACKGROUND

This case arises from an allision on the Mississippi River.2 On May 7,

2018, the M/V STEVE RICHOUX, the defendants’ towing vessel, allided with

1 R. Doc. 32 (Case No. 18-4745).

2 See R. Doc. 1 at 3 ¶ 11 (Case No. 18-4745).

the Robin Street Wharf on the Mississippi River’s left descending bank.3 The

municipal address for the wharf is 1380 Port of New Orleans Place,4 and it is

owned by the Board of Commissioners for the Port of New Orleans (“the

Board”).5 Mardi Gras World did not actually own any physical property

damaged in the allision.6 Rather, Mardi Gras World leases the Robin Street

Wharf from the Board,7 along with adjacent property from the Board and

other lessors.8

The parties entered into the lease in 20089 and can extend it through

2032.10 The agreement provides Mardi Gras World with an interest in a large

area of property along the Mississippi River. The lease includes the Robin

Street Wharf, which covers approximately 125,000 square feet of interior

space, including “built out office and shop space,” and approximately 25,000

square feet of exterior space “and underlying wharf substructure.”11 The

leased premises also include approximately 270,000 square feet of the

3 R. Doc. 32-3 at 1 ¶ 1 (Case No. 18-4745). Mardi Gras World does not

contest Marquette’s statement of facts. See R. Doc. 41 at 4 (Case No. 18-

4745).

4 R. Doc. 32-3 at 1 ¶ 1 (Case No. 18-4745).

5 Id. at 1 ¶ 2.

6 Id. at 2 ¶ 4.

7 Id. at 2 ¶ 3.

8 See, e.g., R. Doc. 32-6 at 27, 66-67 (Case No. 18-4745).

9 See id. at 51-52.

10 See id. at 15 ¶ 3(B).

11 See id. at 13 ¶ (c)1(A)(i).

Orange Street Wharf,12 and over five acres of land next to the wharves.13

Mardi Gras World can use these premises for a “Mardi Gras Museum,

exhibition, office, catering, and meeting facility(ies),” as well for “minor

construction . . . related to artistic and creative activities.”14 But it must make

improvements to these premises, which “shall become the property of the

Board.”15 It also must pay taxes associated with the property.16 It must

maintain property insurance at its “sole cost and expense . . . in favor of

Lessors.”17 And it must “at its own cost, risk and expense . . . repair, replace,

or restore any and all of the Leased Premises which may become the subject

of loss, damage or destruction.”18

Following the damage to these lease premises, Mardi Gras World19

filed this action against Marquette.20 Mardi Gras World alleges that the

12 See id. at 13-14 ¶ (c)1(A)(ii).

13 See id. at 14 ¶ (c)1(B), 75-78.

14 R. Doc. 32-6 at 31 ¶ 5(A) (Case No. 18-4745).

15 Id. at 40 ¶ 12(D).

16 Id. at 45 ¶ 24.

17 Id. at 37 ¶ 10(E)(i).

18 Id. at 34 ¶ 9(B).

19 This complaint also included as plaintiffs Blaine Kern’s Mardi Gras

World, Inc.; New Orleans Hotel Collection, L.L.C.; and Blaine Kern Artists,

Inc. See R. Doc. 1 at 1 (Case No. 18-4745). Both Blaine Kern’s Mardi Gras

World, Inc., and New Orleans Hotel Collection, L.L.C., have since voluntarily

dismissed their claims. See R. Doc. 30 (Case No. 18-4745); R. Doc. 31 (Case

No. 18-4745). Marquette does not assert the instant motion against Blaine

Kern Artists, Inc. See R. Doc. 32-1 at 1 n.1 (Case No. 18-4745).

20 R. Doc. 1 (Case No. 18-4745).

incident caused “increased and additional expenses, structural damage,

property damage, delayed production, lost production, increased overhead,

interruption of business, stigma, damaged reputation, loss of use, lost

profits, repair costs, and other physical and economic damages not yet

realized.”21 Marquette subsequently filed a limitation complaint,22 and the

two complaints were consolidated.23 AGCS Marine Insurance Company,

Mardi Gras World’s insurer, and the Board have separately intervened as

claimants.24

Marquette now moves for partial summary judgment on Mardi Gras

World’s claims for economic damages.25 Mardi Gras World opposes the

motion.26

II. LEGAL STANDARD

Summary judgment is warranted when “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); see also Celotex Corp. v.

21 Id. at 3 ¶ 12.

22 R. Doc. 1 (Case No. 18-5579).

23 R. Doc. 5 (Case No. 18-4745); R. Doc. 4 (Case No. 18-5579).

24 See R. Doc. 8 (Case No. 18-4745); R. Doc. 21 (Case No. 18-4745).

25 R. Doc. 32 (Case No. 18-4745).

26 R. Doc. 41 (Case No. 18-4745).

Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 1069,

1075 (5th Cir. 1994) (en banc) (per curiam). “When assessing whether a

dispute to any material fact exists, [the Court] consider[s] all of the evidence

in the record but refrain[s] from making credibility determinations or

weighing the evidence.” Delta & Pine Land Co. v. Nationwide Agribusiness

Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 2008). All reasonable inferences are

drawn in favor of the nonmoving party, but “unsupported allegations or

affidavits setting forth ‘ultimate or conclusory facts and conclusions of law’

are insufficient to either support or defeat a motion for summary judgment.”

Galindo v. Precision Am. Corp., 754 F.2d 1212, 1216 (5th Cir. 1985) (quoting

10A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure

§ 2738 (2d ed. 1983)); see also Little, 37 F.3d at 1075. “No genuine dispute

of fact exists if the record taken as a whole could not lead a rational trier of

fact to find for the nonmoving party.” EEOC v. Simbaki, Ltd., 767 F.3d 475,

481 (5th Cir. 2014).

If the dispositive issue is one on which the moving party will bear the

burden of proof at trial, the moving party “must come forward with evidence

which would ‘entitle it to a directed verdict if the evidence went

uncontroverted at trial.’” Int’l Shortstop, Inc. v. Rally’s, Inc., 939 F.2d 1257,

1264-65 (5th Cir. 1991) (quoting Golden Rule Ins. Co. v. Lease, 755 F. Supp.

948, 951 (D. Colo. 1991)). “[T]he nonmoving party can defeat the motion” by

either countering with evidence sufficient to demonstrate the “existence of a

genuine dispute of material fact,” or by “showing that the moving party’s

evidence is so sheer that it may not persuade the reasonable fact-finder to

return a verdict in favor of the moving party.” Id. at 1265.

If the dispositive issue is one on which the nonmoving party will bear

the burden of proof at trial, the moving party may satisfy its burden by

pointing out that the evidence in the record is insufficient with respect to an

essential element of the nonmoving party’s claim. See Celotex, 477 U.S. at

325. The burden then shifts to the nonmoving party, who must, by

submitting or referring to evidence, set out specific facts showing that a

genuine issue exists. See id. at 324. The nonmovant may not rest upon the

pleadings, but must identify specific facts that establish a genuine issue for

resolution. See, e.g., id.; Little, 37 F.3d at 1075 (“Rule 56 ‘mandates the entry

of summary judgment, after adequate time for discovery and upon motion,

against a party who fails to make a showing sufficient to establish the

existence of an element essential to that party’s case, and on which that party

will bear the burden of proof at trial.’” (quoting Celotex, 477 U.S. at 322

(emphasis added))).

III. DISCUSSION

Marquette argues that, pursuant to Robins Dry Dock & Repair Co. v.

Flint, 275 U.S. 303 (1927), Mardi Gras World cannot recover economic

damages.27 In Robins Dry Dock, the Supreme Court stated a rule limiting

tort liability: “[N]o authority need be cited to show that, as a general rule, at

least, a tort to the person or property of one man does not make the tort-

feasor liable to another merely because the injured person was under a

contract with that other unknown to the doer of the wrong.” 275 U.S. at 309.

The Fifth Circuit has “interpreted Robins Dry Dock to mean that there can

be no recovery for economic losses caused by an unintentional maritime tort

absent physical damage to property in which the victim has a proprietary

interest.” Amoco Transp. Co. v. S/S MASON LYKES, 768 F.2d 659, 666 (5th

Cir. 1985).28

Here, Mardi Gras World seeks to recover, among other things,

economic losses caused by an unintentional maritime tort.29 To proceed,

therefore, Mardi Gras World must have suffered (a) “physical damage” to (b)

27 See, e.g., R. Doc. 32-1 at 13 (Case No. 18-4745).

28 According to the Fifth Circuit, this rule serves as a “pragmatic

limitation imposed by the Court upon the tort doctrine of foreseeability.”

State of La. ex rel. Guste v. M/V TESTBANK, 752 F.2d 1019, 1023 (5th Cir.

1985) (en banc). That is, under Robins Dry Dock, a harm may be foreseeable

but nevertheless not cognizable.

29 See R. Doc. 1 at 3 ¶ 12 (Case No. 18-4745).

property in which it has a “proprietary interest.” The parties do not dispute

that physical damage occurred.30 The wharf that suffered physical damage,

though, was owned by the Board and leased to Mardi Gras World.31 At issue,

therefore, is whether Mardi Gras World had a “proprietary interest” in this

wharf. The Court finds that Mardi Gras World’s leasehold constitutes a

sufficient proprietary interest to allow it to seek recovery under Robins Dry

Dock for economic loss.

A. Mardi Gras World’s “Proprietary Interest” Under Its

Lease

A plaintiff need not own property outright to have a “proprietary

interest” in it. See State of Veracruz v. BP, P.L.C. (In re Deepwater

Horizon), 784 F.3d 1019, 1026 (5th Cir. 2015) (“The Robins Dry Dock Court

itself, however, intimated that something perhaps just shy of outright

ownership might suffice to show the requisite proprietary interest.”). If the

plaintiff is not the actual owner of the property, though, he must be

“‘tantamount’ to an owner” to recover. Plains Pipeline, L.P. v. Great Lakes

Dredge & Dock Co., 620 Fed. App’x 281, 285 (5th Cir. 2015) (quoting

Veracruz, 784 F.3d at 1026).

30 R. Doc. 32-3 at 1 ¶ 2 (Case No. 18-4745).

31 Id. at 1 ¶¶ 1-2, 2 ¶ 3.

To identify whether a plaintiff’s interest in property is tantamount to

ownership, courts consider whether the plaintiff’s rights in the property

exhibit “incidents of ownership.” See Veracruz, 784 F.3d at 1026 (quoting

Louisville & Nashville R.R. Co. v. M/V Bayou Lacombe, 597 F.2d 469, 474

(5th Cir.1979)). Specifically, the Fifth Circuit looks to three main factors:

(1) “responsibility for repair,” (2) “responsibility for maintenance,” and

(3) “actual possession or control.” Tex. E. Transmission Corp. v. McMoRan

Offshore Expl. Co., 877 F.2d 1214, 1225 (5th Cir. 1989) (citing Bayou

Lacombe, 597 F.2d at 474). Here, Mardi Gras World’s interest in the wharf,

as established by its lease with the Board, exhibits all three factors.

First, Mardi Gras World has responsibility for repair of the wharf. The

lease agreement between Mardi Gras World and the Board states: “Lessee

[Mardi Gras World] agrees that it shall at its own cost, risk and expense

promptly and with due diligence repair, replace, or restore any and all of the

Leased Premises [property including the Robin Street Wharf] which may

become the subject of loss, damage or destruction.”32 Marquette

acknowledges that Mardi Gras World “has broad responsibility to repair

32 R. Doc. 32-6 at 34 ¶ 9(B) (Case No. 18-4745) (emphasis added).

damages to the leased premises.”33 Indeed, Marquette explicitly “does not

challenge” Mardi Gras World’s “claim for repair costs.”34

Second, Mardi Gras World has responsibility for maintenance of the

wharf. According to the terms of the lease, “Lessee shall be responsible for

and shall at its own cost, risk and expense perform and pay all costs of

maintenance and repairs.”35 Indeed, “[d]uring the Term of the Lease,

Lessors shall have no responsibility whatsoever to perform any

construction, maintenance or repair work on the Leased Premises.”36 The

lease does require Mardi Gras World to “obtain prior written approval from

the Board for any maintenance, repairs, [or] dredging.”37 But the adjacent

provisions make clear that the Board’s ministerial function does not divest

Mardi Gras World of the responsibility for maintaining the wharf. Indeed,

the same requirement of approval for maintenance also applies to repairs,

which—as noted above—Marquette does not appear to challenge.

Third, Mardi Gras World has actual possession or control of the wharf.

Black’s Law Dictionary defines “actual possession” as “[p]hysical occupancy

or control over property. Cf. constructive possession.” Actual Possession,

33 R. Doc. 32-1 at 8 (Case No. 18-4745).

34 Id. at 12.

35 R. Doc. 32-6 at 33 ¶ 7(A) (Case No. 18-4745) (emphasis added).

36 Id. (emphasis added).

37 Id.

Black’s Law Dictionary (11th ed. 2019) (first emphasis added); accord Tex.

E., 877 F.2d at 1225 (when discussing three-part proprietary interest test,

examining whether company had “functional possession or control” over

property (emphasis added)). Mardi Gras World’s use of the property has

both “an attraction component and . . . an event venue component.”38 As an

attraction, Mardi Gras World operates tours that allow the public “to see how

the floats and props are constructed for Mardi Gras.”39 As an event venue,

Mardi Gras World primarily rents the premises for corporate functions.40

Overall, these activities suggest that Mardi Gras World has physical

occupancy of the property. Indeed, the lease describes Mardi Gras World as

“occup[ying]” the wharf.41 And Marquette’s stipulations also identify Mardi

Gras World as an “occupant[] of the Robin Street Wharf.”42 Mardi Gras

World, therefore, actually possesses the property.

The Fifth Circuit has stated this element of the test in the disjunctive—

actual possession or control. Arguably a finding that Mardi Gras World

38 R. Doc. 41-3 at 2:11-12 (Case No. 18-4745).

39 Id. at 2:12-15.

40 Id. at 2:15-19.

41 R. Doc. 32-6 at 33 ¶ 8(B) (Case No. 18-4745) (“Lessee, from the time of

its occupancy and until the Leased Premises are vacated by Lessee, shall

assume sole liability for the condition of the Leased Premises . . . .” (emphasis

added)). As the contract establishes a lease of real property, any occupancy

would be “physical.”

42 R. Doc. 32-7 at 1 (Case No. 18-4745).

actually possesses the wharf should satisfy this prong. Nevertheless, the

Court finds that the level of control Mardi Gras World exercises over the

property also satisfies a conjunctive test.43

Specifically, the lease states that Mardi Gras World has “complete

control or ‘GARDE’ over the Leased Premises.”44 It “exercise[s] complete

control or ‘Garde’ over . . . access.”45 And it has “sole liability for the

condition of the Leased Premises as well as of any constructions, utilities and

other improvements.”46 Although limits on use exist, the limiting language

broadly describes the purpose for which Mardi Gras World leases the

property, rather than purporting to circumscribe how Mardi Gras World

runs its business. For example, the lease restricts Mardi Gras World’s use of

the wharf to that of “a Mardi Gras Museum, exhibition, office, catering, and

43 Consequently, Mardi Gras World would also satisfy a conjunctive

reading of the definition of “actual possession,” which itself already

incorporates the concept of control. See Actual Possession, Black’s Law

Dictionary (11th ed. 2019) (defining “actual possession” as “[p]hysical

occupancy or control” (emphasis added)).

44 R. Doc. 32-6 at 33 ¶ 8(B) (Case No. 18-4745). “The Louisiana Supreme

Court’s definition of custody is based on the French legal concept of garde.”

Royer v. Citgo Petroleum Corp., 53 F.3d 116, 118-19 (5th Cir. 1995).

Generally, “[t]he things in one’s garde are ‘those things to which one bears

such a relationship as to have the right of direction and control over them,

and to draw some kind of benefit from them.’” Haas v. Atl. Richfield, 799

F.2d 1011, 1014 (5th Cir. 1986) (quoting Loescher v. Parr, 324 So. 2d 441,

449 n.7 (La. 1975)).

45 R. Doc. 32-6 at 19 ¶ 17(A) (Case No. 18-4745).

46 Id. at 33 ¶ 8(B).

meeting facility(ies),” as well as to “minor construction . . . related to artistic

and creative activities.”47 The lease also establishes safety practices

consistent with these very activities. For example, “Lessee shall not use the

Leased Premises for any heavy construction or any activity involving welding

or use of an open flame or toxic material.”48

Such reasonable restrictions do not prevent Mardi Gras World from

exercising control over the wharf. Even an outright owner could encounter

analogous zoning or environmental regulations circumscribing its use of

property. And restrictions are not uncommon in commercial leases in

general, see, e.g., 5 Alan M. Weinberger, Thompson on Real Property

§ 44.03 (Thomas ed. 2019), or the Board’s leases in particular.49 Overall,

therefore, and when viewed in light of Mardi Gras World’s possession of the

property, the Court finds the level of control accorded to Mardi Gras World

in the lease sufficient to qualify as an incident of ownership.

47 Id. at 31 ¶ 5(A). Similarly, the lease qualifies Mardi Gras World’s ability

to use the wharf as a berthing facility. See id. at 32 ¶ 5(D) (“Lessee shall not

dock or berth any vessel at the Leased Premises without prior written

approval of the Board. The Board reserves the right to levy and collect any

and all charges for the berthing of any vessels at the Leased Premises.”).

48 Id. at 31 ¶ 5(A).

49 See R. Doc. 41-2 at 1 ¶ 5 (“The limited restrictions on use by Mardi Gras

World of the Robin Street Wharf included in the Agreement are typical and

customary in lease agreements between the Board and its lessees.”).

In addition to the Texas Eastern factors, some courts have looked to

the original distinction drawn in Robins Dry Dock—that between a time

charterer of a ship and a demise charterer—to illustrate the concept of a

proprietary interest. See, e.g., Veracruz, 784 F.3d at 1031. Specifically, the

Robins Dry Dock Court found that a time charter did not confer a sufficient

property interest50 to permit recovery for economic loss. See 275 U.S. at 307-

08. But “[t]he Court left open the possibility that a ‘demise’ agreement might

satisfy the proprietary interest requirement even if the ‘time charter’ at issue

in that case did not.” Veracruz, 784 F.3d at 1026 (citing Robins Dry Dock,

275 U.S. at 308).

The Fifth Circuit has elaborated on the distinction between a time

charter and a demise charter. Under a time charter, “the owner’s people

continue to navigate and manage the vessel, but her carrying capacity is

taken by the charterer for a fixed time for the carriage of goods.” Bayou

Lacombe, 597 F.2d at 473 n.3 (quoting G. Gilmore & C. Black, The Law of

Admiralty § 4-1 (2d ed. 1975) [hereinafter Gilmore & Black]). Under a

demise charter, on the other hand, “the charterer takes over the ship, lock,

stock and barrel, and mans her with his own people.” Id. (emphasis

50 The Robins Dry Dock Court referred to “property right[s].” See 275

U.S. at 308. The “proprietary interest” test, the touchstone in this Circuit,

satisfies the Supreme Court requirement. See, e.g., Guste, 752 F.2d at 1021.

removed) (quoting Gilmore & Black § 4-1). Under this analogy, possessing a

proprietary interest sufficient to satisfy the Robins Dry Dock rule requires

having “the incidents of ownership attributable to the demise-charterer.” See

Bayou Lacombe, 597 F.2d at 474.

Here, the nature of Mardi Gras World’s interest in the wharf resembles

that of a demise charterer’s interest in a ship.51 Mardi Gras World has

“take[n] over” the wharf and “man[ned] her with [its] own people,” Bayou

Lacombe, 597 F.2d at 473 n.3 (emphasis removed) (quoting Gilmore & Black

§ 4-1). Indeed, Mardi Gras World is liable for the damage caused to the

wharf.52 And although Mardi Gras World cannot use the wharf entirely

without restriction, “restrictions on use” also “typically” occur in demise

contracts. See 2 Thomas J. Schoenbaum, Admiralty & Maritime Law § 11:3

(6th ed. Oct. 2018 update); see also, e.g., Limon v. Berryco Barge Lines,

L.L.C., No. G-07-0274, 2011 WL 835832, at *7 (S.D. Tex. Mar. 7, 2011)

(finding that a demise charter can have “restrictions on use” that are “not

inconsistent with possession and control”). But see Bayou Lacombe, 597

51 The Fifth Circuit has observed that the demise charter comparison may

“perhaps [be] less onerous” than its subsequently developed tests. See

Veracruz, 784 F.3d at 1031. Consequently, an interest that exhibits all the

Texas Eastern factors would also likely complete the original Robins Dry

Dock analogy.

52 See R. Doc. 32-6 at 34 ¶ 9(B) (Case No. 18-4745).

F.2d at 474 (noting that under a demise charter, “the shipowner retains

merely a right of reversion”).

Indeed, “the demise charterer is analogous” to “the lessee of a house

and lot.” Id. at 473 n.3 (emphasis removed) (quoting Gilmore & Black § 4-

1). “Put differently, if [the plaintiff] shows that it has interests in the

[property] similar to the interests it would acquire in a vessel from a demise

charter or in real estate from a lease, then it can satisfy the requirements of

Robins Dry Dock.” Nexen Petroleum U.S.A., Inc. v. Sea Mar Div. of Pool

Well Servs. Co., 497 F. Supp. 2d 787, 796 (E.D. La. 2007) (Vance, J.)

(emphasis added). Here, Mardi Gras World has a lease on real estate.

Consequently, to the extent such a lease mirrors the demise charter, it also

should satisfy the Robins Dry Dock rule. Overall, therefore, whether viewed

in terms of the three-factor Texas Eastern test, or in terms of the original

Robins Dry Dock analogy that these factors attempted to illustrate, Mardi

Gras World has a proprietary interest that permits it to sue for economic loss.

Significantly, the facts of this case differ materially from those of other

cases in which the Fifth Circuit found that a proprietary interest did not exist.

In Texas Eastern itself, for instance, the plaintiff attempted to recover

economic damages following the rupture by an anchor of a pipeline carrying

natural gas. See 877 F.2d at 1219, 1223. But there, in addition to not owning

the pipeline, the plaintiff neither “possess[ed] the exclusive right to use” the

property, nor had “any responsibility to perform repairs” following its

damage. See id. at 1224-25. Rather, the plaintiff’s responsibility was largely

limited to “routine maintenance, consisting of the painting, cleaning, and

inspecting” of some of the pipeline’s “appurtenances.” See id. at 1225. Here,

by contrast, Mardi Gras World’s rights and responsibilities under its lease

are of an entirely different order. Mardi Gras World leases an expansive

property53 for a variety of its own business functions,54 over which it has

extensive improvement,55 insurance,56 tax,57 repair,58 and maintenance

responsibilities.59

Similarly, in Bayou Lacombe, which the Texas Eastern court analyzed,

a railroad company with a “contractual right to use [a] bridge” could not

recover economic damages after a vessel damaged the bridge, preventing

trains from crossing. See 597 F.2d at 470. But the railroad never possessed

or controlled the bridge, or contributed to its upkeep. See id. at 474. Again,

by contrast, Mardi Gras World exhibits a wholly different relationship with

53 See R. Doc. 32-6 at 13-14 ¶ (c)1 (Case No. 18-4745).

54 See id. at 31 ¶ 5(A).

55 See id. at 40 ¶ 12(D).

56 See id. at 37 ¶ 10(E)(i).

57 See id. at 45 ¶ 24.

58 See id. at 34 ¶ 9(B).

59 See R. Doc. 32-6 at 33 ¶ 7(A) (Case No. 18-4745).

the wharf: Mardi Gras World’s rights are far more sweeping than the “right

of [a] user in the nature of an easement.” Id. at 473.

Other cases likewise reveal that Mardi Gras World’s interest in the

wharf is dissimilar to circumstances where the Fifth Circuit has barred

recovery of economic losses under Robins Dry Dock. See, e.g., In re Bertucci

Contracting Co., L.L.C., 712 F.3d 245, 246 (5th Cir. 2013) (disallowing

economic damages to residents of community affected by bridge closure

following vessel allision); Dick Meyers Towing Serv., Inc. v. United States,

577 F.2d 1023, 1024 (5th Cir. 1978) (per curiam) (disallowing economic

damages to boat operator following delays caused by lock failure). Indeed,

the Court has found no case where Robins Dry Dock barred the economic

loss claims of a plaintiff with interests of the same character as Mardi Gras

World’s.

When other courts have analyzed facts similar to those here, though,

they have reached the same conclusion as this Court. Specifically, the weight

of the district court authority supports finding a proprietary interest arising

from such a lease. See Dixie Marine, Inc. v. Q Jake M/V, No. 16-12415, 2017

WL 3600574, at *1, *8 (E.D. La. Aug. 22, 2017) (concluding that a plaintiff

operating under a similar lease with the Board met all three factors and

therefore had a proprietary interest in a wharf);60 Diversified Grp., LLC v.

La. Carriers, Inc., No. 12-1161, 2013 WL 2147547, at *4 (E.D. La. May 15,

2013) (concluding that “Dixie Marine has a proprietary interest in the

wharf”); In re Complaint of Clearsky Shipping Corp., No. 96-4099, 1999 WL

705553, at *4-5, *7-8 (E.D. La. Sept. 8, 1999) (finding evidence of retailers’

proprietary interest in spaces leased at the Riverwalk made summary

judgment improper); New Orleans Steamboat Co. v. M/V JAMES E.

WRIGHT, Nos. 87-4437, 88-1236, 1990 WL 128212, at *1, *8, *10 (E.D. La.

Aug. 23, 1990) (finding “excursion boat enterprise” had proprietary interest

in wharf based on a “Preferential Assignment Agreement” with the Board).

B. The Effect of Louisiana Statutes on Mardi Gras World’s

“Proprietary Interest”

Marquette contends that, in addition to the restrictions created by

Mardi Gras World’s lease, restrictions created by the Louisiana statutes that

govern riparian property rights also prevent Mardi Gras World from having

a sufficient interest to recover. The lease, though, references these statutes,61

and does not transfer a greater interest than they permit. Consequently,

60 See also R. Doc. 41-1 (Case No. 18-4745).

61 See R. Doc. 32-6 at 28 (Case No. 18-4745) (“[T]he Parties acknowledge

that this Lease is made pursuant to the authority granted in Louisiana

Revised Statutes 9:1102.1 and 9:1102.2.”).

consideration of these laws does not alter the Court’s finding that Mardi Gras

World has a proprietary interest in the wharf.

Louisiana’s statutory provisions do not prevent the lease at issue from

satisfying the Texas Eastern test. First, the statutes do not remove Mardi

Gras World’s responsibility for repairing the dock. Indeed, the statutes make

no reference to “repair.” See La. R.S. 9:1102.1, 1102.2. Second, the statutes

do not divest Mardi Gras World of responsibility for maintaining the wharf.

They do provide that “wharves . . . shall remain subject to the administration

and control of the governing authorities with respect to their maintenance.”

La. R.S. 9:1102.1(A); see also id. 9:1102.2(A)(1)(e), 34:22. The lease, though,

specifies the nature of this administration and control: the Board must

provide written approval for Mardi Gras World’s maintenance.62 Written

approval by the Board does not reduce Mardi Gras World’s responsibility to

finance and carry out the maintenance.

Finally, the limits imposed by statute do not substantively alter the

nature of Mardi Gras World’s actual possession or control under the lease.

With regard to actual possession, the statutes do emphasize the state’s right

to retake possession of the property. See La. R.S. 9:1102.1, 9:1102.2. This

right, however, does not dispossess Mardi Gras World of its actual

62 See R. Doc. 32-6 at 33 ¶ 7(A) (Case No. 18-4745).

possession of the wharf—that is, its “functional possession,” Tex. E., 877 F.2d

at 1225, or “[p]hysical occupancy,” Actual Possession, Black’s Law

Dictionary (11th ed. 2019). Nor do these statutory provisions add

substantively to the limitations on control already outlined in the lease.

Indeed, the existence of these statutory provisions has not foreclosed

recovery under Robins Dry Dock in the district court decisions rendered

after their enactment. See Dixie Marine, 2017 WL 3600574, at *8;

Diversified Grp., 2013 WL 2147547, at *4; Clearsky, 1999 WL 705553, at *4-

5, *7-8; New Orleans Steamboat Co., 1990 WL 128212, at *8, *10.

Marquette argues that the Fifth Circuit’s holding in Veracruz suggests

that these statutes prevent Mardi Gras World from having a proprietary

interest. But Veracruz does not change the fundamentals of the Robins Dry

Dock analysis. In Veracruz, the Fifth Circuit had to determine whether,

under Robins Dry Dock, Mexican states could bring a claim for economic

loss attributable to property allegedly damaged in the BP oil spill. See 784

F.3d at 1022-23. Specifically, the court had to decide whether the group of

Mexican states or the Mexican federal government was the “true owner” of

the Mexican property. See 784 F.3d at 1022, 1027. The court concluded that

while the states had a “role . . . in managing some of the country’s property,”

they did not have the “crucial proprietary interest for purposes of Robins Dry

Dock.” Id. at 1031.

The Mexican states do not present a close analogy to Mardi Gras

World. As an initial matter, the Fifth Circuit in Veracruz had to adjudicate

between two governments that both claimed ownership of national assets.

See, e.g., id. at 1027-28. Indeed, the court prefaced its reasoning by

“recogniz[ing] that the Robins Dry Dock analytical framework does not

easily map on to an intragovernmental relationship.” Id. at 1030. Here, by

contrast, the nature of Mardi Gras World’s interest in the wharf more clearly

maps onto that of an “owner pro hac vice,” id. at 1031 (quoting Bayou

Lacombe, 597 F.2d at 473 n.3), a proprietary interest countenanced by

Robins Dry Dock.

Furthermore, the Veracruz court found “essentially decisive,” id. at

1027, a constitutional provision interpreted to mean that “Mexico’s public

domain over these assets is inalienable and cannot be taken away from the

federal government by adverse possession, by either Mexican nationals or

foreigners,” id. (quoting Jorge A. Vargas, Mexican Law: A Treatise for Legal

Practitioners and International Investors § 34.4 (2001) (emphasis added)).

Here, by contrast, the statutes do not purport to endow the Board with a

similar level of supremacy. Rather, the statutes envision a more limited

sphere of power where, for example, “wharves . . . shall remain subject to the

administration and control of the governing authorities with respect to their

maintenance and to the fees and charges to be exacted for their use by the

public,” La. R.S. 9:1102.1(A).

Similarly, when looking outside the Mexican constitution, the

Veracruz court concluded that “[Mexican] federal law places the bulk of the

power . . . in the hands of the federal government.” 784 F.3d at 1031. Here,

though, the Texas Eastern analysis suggests that Mardi Gras World wields

sufficient power with respect to the wharf to have a proprietary interest in it.

And, while the Veracruz court confirmed that Texas Eastern did not

“sanction[] recovery for something less than ownership,” it at no point

repudiated the Texas Eastern factors. See id. at 1026. Indeed, Judge

Barbier—who authored the district court opinion affirmed in Veracruz—

subsequently applied the Texas Eastern test to find that a company leasing

a wharf from the Port of New Orleans had “a sufficient proprietary interest

to recover economic loss.” Dixie Marine, 2017 WL 3600574, at *8. That

lease is substantially similar to the one at issue here.63 Thus, neither

Louisiana statute nor the holding of Veracruz requires the Court to find that

63 See R. Doc. 41-1 (Case No. 18-4745).

Louisiana law prevents Mardi Gras World from having a proprietary interest

in the wharf.

IV. CONCLUSION

For the foregoing reasons, the Court DENIES Marquette’s motion for

partial summary judgment.

New Orleans, Louisiana, this_l1th day of September, 2019.

SARAH S. VANCE

UNITED STATES DISTRICT JUDGE

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