In Re: The Matter of the Complaint of N&W Marine Towing, L.L.C.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

IN THE MATTER OF THE COMPLAINT CIVIL ACTION NO: 2:20-cv-02390

OF N&W MARINE TOWING, LLC, AS C/W 2:21-cv-00150

OWNER OF THE M/V NICHOLAS, ITS

ENGINES, TACKLE, APPURTENANCES, SECTION T(1)

FURNITURE, ETC. PRAYING FOR

EXONERATION FROM OR THIS ORDER APPLIES TO ALL CASES

LIMITATION OF LIABILITY

ORDER

Before the Court is a Motion to Stay Limitation of Liability Proceeding and to Lift

Injunction filed by Claimant Plaintiff Trey Wooley (“Claimant” or “Claimant Wooley”).1 N&W

Marine Towing, LLC, (“N&W Marine”) has filed an opposition,2 to which Claimant filed a reply.3

The Court then granted leave after N&W Marine moved to file a supplemental memorandum in

opposition,4 and again allowed further briefing for Claimant’s response to N&W’s supplemental

memorandum.5 For the following reasons, the Motion is GRANTED.

BACKGROUND

This is a civil maritime action for exoneration from or limitation of liability pursuant to 46

U.S.C. § 305, et seq. arising from an incident involving multiple vessels on the Mississippi River.

On February 29, 2020, the M/V NICHOLAS was traveling upriver with a six pack of barges in

tow. While navigating between the M/V ASSAULT on one side of the river and an overtaking

cruise ship on the other, both face wires connecting the M/V NICHOLAS to its tow were severed.

Following the first breakage, the M/V ASSAULT radioed to offer help in replacing the face wires

on the M/V NICHOLAS. Several deckhands, including the Plaintiff, Trey Wooley, boarded the

1 R. Doc. 119.

2 R. Doc. 127.

3 R. Doc. 129.

4 R. Doc. 135.

5 R. Doc. 138.

M/V NICHOLAS. During his attempt to remove the broken face wire, Plaintiff’s hand was crushed

when another seaman allegedly turned on the winch.

On August 31, 2020, the owner of the M/V NICHOLAS filed a Verified Complaint in

Limitation under Rule F(1).6 Following Claimant’s filing for damages and his answer in this

Court,7 Claimant filed a Petition for Damages in the Civil District Court for the Parish of Orleans,

which was subsequently removed and later consolidated upon the filing of a Notice of Removal

by Defendant Royal Caribbean Cruises (“RCCL”).8

On July 27, 2021, the Court denied Claimant’s Motion to Bifurcate.9 Shortly thereafter, on

August 4, 2021, Claimant filed the instant motion and related stipulation informing the Court that

Claimant Turn Services, LLC (“Turn Services”) had agreed to settle by assigning its contribution

and indemnity claims to Claimant Wooley.10 As a result, Claimant Wooley contends that this is

now a single claimant action and, pursuant to Fifth Circuit precedent, the Court must stay the

limitation action so that Claimant Wooley may pursue his damages claim in state court.11

Each of the remaining parties has offered considerable argument debating the mechanics

of diversity snap removal jurisdiction and the Fifth Circuit’s Texas Brine decision.12 N&W Marine

argues that despite Claimant Wooley’s “sharp maneuvering” to manufacture a single claimant in

limitation action, this case is properly before the Court on all issues because the claim was properly

removed due to complete diversity of citizenship at the time of removal.13 N&W Marine further

6 R. Doc. 1; Fed. R. Civ. P. F(1).

7 R. Doc. 12.

8 R. Docs. 1 and 8, respectively.

9 R. Doc. 117.

10 R. Docs. 119 and 118.

11 R. Doc. 119-1 at 2.

12 Texas Brine Company, L.L.C. v. American Arbitration Association, Inc. 955 F.3d 482 (5th Cir. 2020) (holding that

an out-of-state defendant served with process can immediately remove to federal court before in-state defendants are

served to circumvent the forum-defendant rule).

13 R. Doc. 127 at 1-2.

contends that by filing a lawsuit in state court following removal, Claimant violated this Court’s

Stay Order and thus foreclosed his ability to later proceed in state court.”14 In response, Claimant

argues that while N&W Marine has the right to the federal forum for limiting liability, Claimant

has the “absolute statutory right under the Savings to Suitors Clause to choose his forum to hear

his [damages] case.”15 Claimant also distinguishes the facts of this case from Texas Brine by

asserting that this case was not “otherwise removable” because there was no diversity at the time

of filing.16 Claimant does not deny the “propriety of snap removal,” but instead highlights the

“fundamental fact” that this is now a single claimant case with the proper stipulations filed

regardless of N&W Marine’s jurisdictional claims.17

LAW AND ANALYSIS

Federal courts have exclusive admiralty jurisdiction to determine whether the vessel owner

is entitled to limited liability.18 In limitation proceedings, as in all admiralty cases, there is no

right to a jury trial.19 In Odeco II, the Fifth Circuit held that a shipowner facing potential liability

for an accident occurring on the high seas may file suit in federal court seeking protection under

the Limitation Act.20 The Limitation Act allows a shipowner, lacking privity or knowledge, to

limit liability for damages arising from a maritime accident to the “amount or value of the interest

14 Id.; see also R. Doc. 132-3 at 1 (“At the outset, Mr. Wooley had several choices when and where he could originally

bring his claim. Mr. Wooley’s choices and the timing of those choices sealed his fate. Mr. Wooley’s simple argument

is that single claimant equates to a return to state court. The facts of this case and the procedural choices Mr. Wooley

made, forecloses a return to state court.”).

15 R. Doc. 129 at 1.

16 Id. at 3.

17 R. Doc. 138 at 2.

18 Ex Parte Green, 286 U.S. 437, 439-40, 52 S.Ct. 602, 603, 76 L.Ed. 1212 (1932) (holding that the admiralty court's

jurisdiction over issues bearing on the right to limited liability, such as “privity or knowledge,” is exclusive).

19 Waring v. Clarke, 46 U.S. (5 How.) 441, 459, 12 L.Ed. 226, 235 (1847) (holding that the Seventh Amendment does

not provide for jury trials in admiralty cases).

20 Odeco Oil and Gas Co., Drilling Division v. Bonnette, 74 F.3d 671, 674 (5th Cir. 1996) (citations omitted in part)

(“Odeco II”).

of such owner in such vessel, and her freight then pending.”21 The Limitation Act is designed to

protect shipowners in those cases in which “the losses claimed exceed the value of the vessel and

freight.”22 A shipowner's right to limitation, however, is cabined by the “Saving to Suitors”

clause.23 The Saving to Suitors clause evinces a preference for jury trials and common law

remedies in the forum of the claimant's choice.24 Although tension exists between the Limitation

Act and the Saving to Suitors clause, “the [district] court's primary concern is to protect the

shipowner's absolute right to claim the Act’s liability cap, and to reserve the adjudication of that

right in the federal forum.”25

In mediating between the right of shipowners to limit their liability in federal court and the

rights of claimants to sue in the forum of their choice, federal courts have developed two instances

in which a district court must allow a state court action to proceed: (1) when the total amount of

the claims does not exceed the shipowner’s declared value of the vessel and its freight, and (2)

when all claimants stipulate that the federal court has exclusive jurisdiction over the limitation

proceeding, and that the claimants will not seek to enforce a damage award greater than the value

of the ship and its freight until the shipowner’s right to limitation has been determined by the

federal court.26 In both instances, allowing the state court action to proceed is contingent on

protecting the “absolute” right of the shipowner to limit his or her liability.27

21 Id.; see also 46 U.S.C.A. § 183(a). This Limitation Act provision is now found at 46 U.S.C. § 30505: “Except as

provided in section 30506 of this title, the liability of the owner of a vessel for any claim, debt, or liability described

in subsection (b) shall not exceed the value of the vessel and pending freight.”

22 Magnolia Marine Transport Co. v. Laplace Towing Co., 964 F.2d 1571, 1575 (5th Cir. 1992).

23 See 28 U.S.C. § 1333(1) (giving federal district courts exclusive jurisdiction over “[a]ny civil case of admiralty or

maritime jurisdiction,” but “saving to suitors in all cases all other remedies to which they are otherwise entitled”).

24 See Magnolia Marine Transport Co., 964 F.2d at 1575.

25 Id.

26 In re Weber Marine, No. 2:09-cv-08071, 2010 WL 4884436, at *3 (E.D. La. 12/8/10) (citing Texaco, Inc. v.

Williams, 47 F.3d 765, 768 (5th Cir. 1995)).

27 Id. (citing In re Complaint of Port Arthur Towing Co., 42 F.3d 312, 316 (5th Cir. 1995) and Odeco Oil & Gas Co.,

Drilling Division v. Bonnette, 4 F.3d 401, 405 (5th Cir.1993) (citations omitted in part) (“Odeco I”)).

In this case, Claimant has utilized three motions in attempting to litigate his damages claim

in state court. The first was the motion to remand.28 The second was the motion to bifurcate.29

Following the denial of bifurcation,30 Claimant settled with Turn Services and proceeded with a

third approach, the instant Motion to Stay.31 Regarding the Texas Brine arguments, the Court

understands and accepts the viability of snap removal as controlling Fifth Circuit precedent. Here,

however, determining whether remand is proper based on diversity is not necessary because that

is not the issue. The question presented is whether Claimant’s stipulation satisfies the standard set

forth by the Fifth Circuit in Odeco II for staying the limitation proceeding so that Claimant may

pursue his damages claim in state court.32

After extensive litigation, the posture of this case is now rather simplified: one Claimant

remains, and that Claimant has stipulated to the requirements set forth in Odeco II.33 Upon review,

the Court finds the stipulation satisfactory. Claimant certifies that “in no event will Claimant seek

to enforce such excess judgment or recover against N&W Marine Towing, L.L.C., insofar as such

enforcement may expose N&W Marine Towing, L.L.C.’s liability in excess of the adjudicated

total Limitation Fund value, until such time as there has been an adjudication of limitation by this

Court.”34 The stipulation further identifies this Court’s exclusive jurisdiction to determine all

issues relevant to N&W’s limitation of liability and waives any claim of res judicata.35

Accordingly, the stipulation adequately protects N&W’s absolute right to limit its liability in the

federal forum.36

28 R. Doc. 27.

29 R. Doc. 76.

30 R. Doc. 117.

31 R. Doc.

32 Odeco II, 74 F.3d 671, 674.

33 Id.

34 R. Doc. 118 at 1.

35 Id. at 2.

36 Supra note 27.

Assuming arguendo that snap removal was properly executed, the result would still be the

same because the Court is not remanding based on lack of diversity. While Plaintiff may proceed

in state court, the Court is not relinquishing control of the case, but simply staying the limitation

portion to afford Claimant’s statutory right to pursue damages in state court.37 In doing so, the stay

balances the equities of the parties by “mediating between the right of shipowners to limit its

liability and the right of claimants to sue in the forum of their choice.”38

To be sure, the Court recognizes the unique nature in which this case unfolded. N&W

Marine focuses heavily on the original removal of this action and argues that Claimant has taken

fatal procedural missteps but offers nothing concrete as to how or why those missteps outweigh

the collective precedents requiring stay in factually analogous cases. In the absence of compelling

case law stating otherwise, the Court is bound by appellate authority to stay the limitation

proceeding when a single claimant makes the appropriate stipulations, as holding otherwise could

be viewed as an abuse of discretion at this juncture.39 Accordingly, the Court will grant the Motion.

CONCLUSION

For the foregoing reasons, IT IS ORDERED that the Motion to Lift Stay of Limitation of

Liability in this matter permitting Claimant, Trey Wooley, to proceed with the prosecution of his state

court suit is GRANTED.40

IT IS FURTHER ORDERED that in no event may Claimant, Trey Wooley, seek to enforce

any excess judgment or recovery insofar as it may expose Limitation Plaintiff, N&W Marine Towing,

LLC, to liability in excess of the value of the vessel known as M/V NICHOLAS and her pending

37 See 28 USC § 1333.

38 Odeco II, 74 F.3d at 674.

39 In re Tetra Applied Technologies, L P, 362 F.3d 338 (5th Cir. 2004).

40 R. Doc. 119.

freight, pending adjudication of the Complaint for Exoneration from or Limitation of Liability in this

Court.

IT IS FURTHER ORDERED that this limitation of liability matter is administratively stayed

pending the outcome of the state court actions and, as such, the Court orders the Clerk of Court to mark

this action closed for statistical purposes. This Court, however, shall retain jurisdiction over this

limitation of liability action and this case shall be restored to the trial docket upon the motion of a party

if the state proceedings necessitate further proceedings in this Court.

New Orleans, Louisiana, this 27th day of August, 2021.

Car Gord Gud

UNITED STATES DISTRICT JUDGE