Ingram Barge Company, LLC v. Caillou Island Towing Company, Inc.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

INGRAM BARGE COMPANY LLC CIVIL ACTION

VERSUS NO. 21-261

CAILLOU ISLAND TOWING COMPANY INC., ET AL. SECTION "L" (2)

ORDER AND REASONS

Before the Court are two motions to dismiss filed by Claimant Cecil Brashear. The first

motion seeks dismissal of Caillou Island Towing Company, Inc.’s counterclaim against Brashear.

R. Doc. 41. Caillou Island Towing Company, Inc. opposes the motion. R. Doc. 47. Brashear’s

tsecond motion requests dismissal of Central Gulf Towing, L.L.C.’s (CGT’s) three counterclaims.

R. Doc. 49. Central Gulf Towing, L.L.C. opposes the motion. R. Doc. 52. Considering the parties’

briefs, the oral arguments of counsel, the record, and the applicable law, the Court now rules as

follows.

BACKGROUND

These three consolidated limitation actions arise out of an alleged vessel collision on

November 26, 2020 near mile marker 74.4 of the Mississippi River in Plaquemines Parish. R.

Doc. 1.1 On that date, around 3:30 a.m., the M/V La Belle, a push boat owned and/or operated by

Petitioner Caillou Island Towing Company, Inc. (“Caillou Island”), and the M/V Helen, a towing

vessel owned and/or operated by Petitioner Central Gulf Towing, L.L.C. (“CGT”), were towing

downriver a 500-foot dredge pipe owned by Claimant Manson Construction Company

(“Manson”). R. Doc. 12 at 12; R. Doc. 8 (Case No. 21-489). At the same time, the David G.

1 For the sake of simplicity, unless otherwise specified, all citations to the record refer to case number 21-

261, the lead case in these proceedings.

Sehrt (DGS), a towing vessel owned by Petitioner Ingram Barge Company, LLC (“Ingram

Barge”), was pushing 18 empty barges upriver. R. Doc. 1 at 2. The DGS collided with the dredge

pipe, allegedly causing damage to the vessels and the dredge pipe and injuring Claimant Cecil

Brashear, a Jones Act seamen employed by Caillou Island who was serving aboard the La Belle.

Each of the vessel owners claimed exoneration from or limitation of liability under the

Limitation of Liability of Shipowners Act, 46 U.S.C. § 30501, R. Doc. 1 (Case No. 21-489); R.

Doc. 1 (21-953); R. Doc. 1 (21-1008). The vessel owners all filed claims against one another,

contending that the other shipowners’ vessels were unseaworthy and/or that the captains and

crews aboard those other vessels operated them in a negligent fashion. R. Doc. 1 (21-261); R.

Doc. 4 (21-261); R. Doc. 1 (Case No. 21-262). Claimant Manson filed a claim against Ingram

Barge, alleging that its negligence was responsible for damage to the dredge pipe. R. Doc. 8

(Case No. 21-489).

Additionally, Claimant Cecil Brashear, the Jones Act seaman, allegedly was “violently

knocked around in his bunk” as a result of the collision, sustaining “serious injuries to his neck,

head, shoulder, and arm.” R. Doc. 10 at 12. He filed personal injury claims in state court. This

Court then issued a stay enjoining prosecution of Brashear’s state court claims. After receiving

notice of the limitation proceedings, Brashear answered filed his answers and claims in the

limitation proceedings. Specifically, Brashear made claims under the Jones Act, 46 U.S.C. §

30104, and/or general maritime law against Caillou Island, R. Doc. 10 at 14, and CGT, R. Doc.

12 at 13.

Caillou responded to Brashear’s claims in the limitation proceeding by asserting a

counterclaim against him for fraud. R. Doc. 28. Caillou alleges that, on November 17, 2020,

Brashear received treatment by Dr. Geoffrey Stone for the same conditions and injuries he

alleges were caused by the November 26, 2020 collision. Brashear allegedly fraudulently

concealed this pre-collision treatment during several post-collision medical visits for the injuries

he claims were caused by the incident. Id. at 9-11. According to Caillou, Brashear told Dr. Stone

that his injuries arose at home either two weeks or a month prior to November 17, 2020. Id. at 9.

Immediately after the collision, Brashear allegedly did not report any injuries and completed his

hitch on the M/V LA BELLE. Id. at 8. Then, on December 16, 2020 and January 8, 2021, Dr.

Suneil Jolly at Louisiana Pain Specialists saw Brashear for the same injuries he complained of to

Dr. Stone. During this appointment, Brashear allegedly reported that these injuries arose from the

collision. Id. Brashear purportedly concealed from Dr. Jolly his prior treatment on November 17,

2020, as well as that his injuries and symptoms predated the November 26, 2020 collision. Id.

Caillou alleges that Brashear concealed the same facts and made the same false representation

regarding the cause of his injuries when he was seen by Dr. William Brennan with Neurological

Solutions of Lafayette on February 8, 2021 and April 8, 20201, and during his independent

medical evaluation by Dr. Henry Eiserloh III of Baton Rouge Orthopedic on August 10, 2021.

Id. at 10-11. Caillou also alleges that Brashear hid and misrepresented these facts when he

received an MRI on his cervical spine on January 8, 2021 and an MRI on his left shoulder on

February 23, 2021. Id.

CGT asserted counterclaims in the limitation proceeding against Brashear for fraud and

intentional misrepresentation for similar reasons. R. Doc. 34 at 4. Additionally, Caillou sued

Brashear for malicious prosecution. Id. at 5.

All actions and limitation proceedings arising out of the November 26, 2020 collision

were consolidated in this Court.

PRESENT MOTIONS

Brashear moves to dismiss Caillou’s and CGT’s counterclaims. R. Doc. 41; R. Doc. 49.

He argues that Caillou, as a Jones Act employer, cannot assert a cognizable claim for affirmative

recovery against its seamen. R. Doc. 41-1 at 1. Brashear further argues, even assuming such a

claim were cognizable, Caillou fails to comply with the heightened pleading standards mandated

by Federal Rule of Civil Procedure 9(b).

In opposition, Caillou contends that its claim is cognizable and that its counterclaim

clears the hurdles imposed by Rule 9(b). R. Doc. 47.

As to CGT, Brashear makes similar arguments as to why its fraud and intentional

misrepresentation claims do not meet the pleading requirements under Rule 9(b). R. Doc. 47.

Brashear further argues that CGT’s malicious prosecution is premature and non-viable.

CGT opposes Brashear’s motion, arguing that its fraud and intentional misrepresentations

pass muster under Rule 9(b) but agrees that its malicious prosecution is likely premature. R. Doc.

52.

DISCUSSION

A. Legal Standard

The Federal Rules of Civil Procedure permit a defendant to seek a dismissal of a

complaint based on the “failure to state a claim upon which relief can be granted.” Fed. R. Civ.

P. 12(b)(6). To survive a Rule 12(b)(6) motion to dismiss, a complaint must include factual

allegations that are “enough to raise a right to relief above the speculative level.” Bell Atl. Corp.

v. Twombly, 550 U.S. 544, 555 (2007). Particularly, “a plaintiff must plead specific facts, not

mere conclusory allegations.” Elliott v. Foufas, 867 F.2d 877, 881 (5th Cir. 1989). The complaint

must also “state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570. “A

claim has facial plausibility when the plaintiff pleads factual content that allows the court to

draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v.

Iqbal, 556 U.S. 662, 678 (2009).

When ruling on a motion to dismiss, a court must construe facts in the light most

favorable to the nonmoving party, id., and it “must accept as true all of the factual allegations

contained in the complaint.” Twombly, 550 U.S. at 572 (quoting Swierkiewicz v. Sorema N. A.,

534 U.S. 506, 508 n.1 (2002)). A court “do[es] not accept as true conclusory allegations,

unwarranted factual inferences, or legal conclusions.” Plotkin v. IP Axess Inc., 407 F.3d 690, 696

(5th Cir. 2005).

B. Analysis

As mentioned above, there are two Rule 12(b)(6) motions to dismiss counterclaims

against personal injury claimant Brashear. One, to dismiss a counterclaim filed by the Jones Act

seaman’s employer (Caillou), and another filed by a non-employer vessel owner (CGT). The

Court will discuss each in turn.

1. Brashear’s Motion to Dismiss Caillou’s Counterclaim, R. Doc. 41

Brashear contends that Caillou’s counterclaim must be dismissed under Rule 12(b)(6)

because no authority supports allowing a vessel owner employer to maintain a counterclaim for

fraud against a Jones Act seaman in response to the seaman’s claim for damages due to injury

aboard the vessel. R. Doc. 41-1 at 1. Indeed, Brashear argues that permitting Caillou’s

counterclaim to go forward would improperly “create new law and circumvent the long-

established” rules set forth in McCorpen v. Central Gulf Steamship Corp., 396 F.2d 547 (5th Cir.

1968). Id. Brashear also asserts that Caillou’s counterclaim for fraud fails to meet the heightened

pleading standard Rule 9(b) demands for such claims. Id.

The starting point for the Court’s discussion on the availability of an affirmative claim by

an employer against its seaman must be the Supreme Court’s decision in Still v. Norfolk &

Western Railroad Company, 368 U.S. 35 (1961). There, the Court held that a railroad worker’s

fraud in procuring his employment does not terminate the employment relationship, permitting

the employee to maintain a suit for damages against his employer under the Federal Employers’

Liability Act (“FELA”), even where the employee’s misrepresentation contributed to the incident

or injury that is the basis for his claim. Id. at 41. This conclusion was rooted in FELA’s broad

policy of holding railroads liable for their workers’ personal injuries resulting from the railroad’s

negligence. In the Jones Act, Congress extended FELA’s protections to seamen. Beech v.

Hercules Drilling Co., L.L.C., 691 F.3d 566, 570 (5th Cir. 2012). FELA caselaw thus applies to

Jones Act cases. Id. The Court’s decision in Still thus “makes clear that a ‘seaman . . . is not

barred from suit under the Jones Act because he conceals a material fact in applying for

employment.’” Johnson, 544 F.3d 296, 302 (5th Cir. 2008) (quoting Gypsum Carrier, Inc. v.

Handelsman, 307 F.2d 525, 530 (9th Cir. 1962)).

Although a dishonest seaman may pursue a Jones Act claim against his employer, the

Fifth Circuit, in McCorpen, established an affirmative defense for employers that eliminates their

liability for maintenance and cure—that is, payments for food, lodging, and basic medical care—

when an injured seaman obtains his employment through fraud. The McCorpen defense applies

where the “employer subjects a seaman to a medical examination as part of the hiring process

and the vessel owner can prove that the seaman: (1) intentionally misrepresented or concealed

pertinent medical facts; (2) the non-disclosed facts were material to the company’s decision to

hire the claimant; and (3) there was a causal link between the concealed pre-existing injury and

the employment injury.” Atl. Sounding Co. v. Petrey, 402 F. App’x 939, 941 (5th Cir. 2010). If

the vessel owner satisfactorily proves these elements, then it is not liable for the maintenance and

cure of a seaman who is injured in the service of his vessel. Id.

The Fifth Circuit has acknowledged that McCorpen is “in tension” with Still. Boudreaux

v. TransOcean Deepwater, Inc., 721 F.3d 723, 726 (5th Cir. 2013) (observing that “if,” as Still

establishes, “the seaman’s dishonesty does not terminate his status as seaman or his damages

remedy, the right to maintenance and cure ought be an a fortiori case; after all, it is an essential

part of the employment relationship—a down payment on damages that allows the seaman to

subsist and pay for basic medical expenses in the immediate aftermath of his injury”).

Nonetheless, the McCorpen defense remains available.

In Boudreaux v. TransOcean Deepwater, Inc., the Fifth Circuit clarified that defendants

may wield McCorpen solely as a shield and not as a sword. Id. In other words, Jones Act

employers can invoke McCorpen to insulate themselves from liability for continuing

maintenance and cure benefits; they cannot, however, call upon McCorpen to recoup

maintenance-and-cure benefits already paid to a seaman. Id. at 724. Thus, the McCorpen defense

may not spawn a counterclaim by a vessel owner employer against his seaman employee for

restitution of paid maintenance.

Boudreaux involved a Jones Act seaman who misrepresented that he had serious back

problems when he filled out his pre-employment medical questionnaire. Later, while servicing

equipment, the seaman injured his back. His employer paid him maintenance and cure for several

years. Id. After the seaman filed suit seeking, among other things, further maintenance and cure

payments, his employer discovered evidence of his pre-employment back problems. The

employer thus asserted McCorpen as a defense to liability for continuing maintenance and cure

payments. The employer then went a step further: purporting to rely on McCorpen, it filed a

counterclaim, seeking restitution of the maintenance and cure payments it had already made to

the seaman. Id. at 725.

The Fifth Circuit dismissed the counterclaim and held that, as a matter of law, a vessel

owner who establishes a McCorpen defense is not entitled to restitution for benefits already paid.

Id. at 727. Rather, the Fifth Circuit ruled that a Jones Act employer who pays maintenance and

cure to an injured seaman can recover those payments “only by offset against the seamen’s

damages award—not by an independent suit seeking affirmative recovery.” Id. at 728.

The Boudreaux court noted that the law authorizes an employer to investigate a seaman’s

claim prior to paying maintenance and cure benefits2 and establishes the McCorpen defense,

enabling an employer to deduct benefits already paid from any damages award a seaman may

receive. This existing regime, the court reasoned, strikes the appropriate balance between

protecting seamen from the dangers of the sea and employers from dishonest workers. Endorsing

the employer’s “novel attempt to extend the [McCorpen] defense into an affirmative right of

recovery” would result in an affirmative judgment against the seaman when the seaman does not

recover damages or the damages award is insufficient to offset the seaman’s liability for

restitution. Id. at 727. Such a judgment “would stand as a serious impediment to the seaman’s

economic recovery, and its threat would have a powerful in terrorem effect in settlement

negotiations.” Id. In light of these considerations, the Fifth Circuit refused to unsettle

longstanding maritime jurisprudence by exercising its “extraordinary power to a create a new

right of action.” Id. at 728.

2 See Morales v. Garjiak, Inc., 829 F.2d 1355, 1358 (5th Cir. 1987), abrogated on other grounds by

Gueveara v. Maritime Overaseas Corp., 59 F.3d 1496 (5th Cir. 1995) (“Upon receiving a claim for maintenance and

cure, the shipowner need not immediately commence payments; he is entitled to investigate and require

corroboration of the claim. . . . A shipowner who is in fact liable for maintenance and cure, but who has been

reasonable in denying liability, may be held liable only for the maintenance and cure[,] [not compensatory or

punitive damages].”).

Under McCorpen and Boudreaux, Brashear asserts that, at most, his employer, Caillou,

could only receive an offset for prior maintenance and cure paid to him should he be awarded

damages. R. Doc. 41-1 at 6. Put another way, Brashear contends that the Fifth Circuit’s

precedents preclude Caillou from bringing its counterclaim.

Caillou disagrees for several reasons. Although initially Caillou’s arguments appear to

have some persuasive force, upon closer analysis none are availing.

First, Caillou contends that McCorpen and its progeny have no bearing on the case at bar.

Caillou points out that, by its terms, McCorpen only applies to fraud perpetrated by a seaman

that occurs during the hiring process. Caillou’s counterclaim, on the other hand, alleges that

Brashear concealed medical treatment that he received after he had been hired. Compare Atl.

Sounding Co., 402 F. App’x at 941 (explaining that “the non-disclosed facts were material to the

company’s decision to hire the claimant” (emphasis added)) and Nelton v. Cenac Towing Co.,

LLC, No. 10-373, 2011 WL 289040, at *20 (E.D. La. Jan. 25, 2011) (“The Fifth Circuit, starting

with McCorpen itself, has indicated that the defense applies only to pre-employment physical

examinations.”), with R. Doc. 47 at 3-4.

Under the facts alleged, it may well be the case that the McCorpen defense is unavailable

to Caillou. But of course, if Caillou’s argument is correct—and Brashear fabricated his claim that

he was injured as a result of his service on Caillou’s vessel—then Brashear will not be entitled to

any recovery under the Jones Act; all he will have received are past maintenance and cure. And

that is the same result that would obtain even if McCorpen and Boudreaux did apply. Thus, that

McCorpen may not apply directly does not advance Caillou’s argument.

Caillou also argues that its affirmative claim should not be barred because, unlike the

employer in Boudreaux, the “remedy of set-off” is not available to it. R. Doc. 47 at 6. As

Boudreaux noted, precedent permits an employer to offset or deduct past maintenance and cure

from any Jones Act damages recovered by the seaman to the extent the two are duplicative. Id.

(citing Wood v. Diamond M Drilling Co., 691 F.2d 1165, 1171 (5th Cir. 1982)). This is true,

regardless of the applicability of McCorpen. Id.

Caillou is correct that, if Brashear’s claims are fraudulent, then it will not be able to set

off any prior maintenance and cure against a damages award to Brashear. That is because if

Caillou prevails, then that necessarily means that Brashear was never injured during the vessel

collision—and that means Brashear will not be entitled to any damages from which past

maintenance and cure can be offset. But if the jury finds that Brashear did in fact falsely allege

that his injuries stemmed from the collision, then it will not have to pay any damages award at

all.3 Thus, Caillou is no worse off than a Jones Act employer that can offset past maintenance

and cure payments from a damages award to its seaman. Indeed, whereas an employer who

establishes the McCorpen defense may still be liable for Jones Act damages exceeding the

amount offset by past maintenance and cure, Caillou will not be liable for any damages to

Brashear, if its allegations of fraud are meritorious.

Next, Caillou asserts that its affirmative claim should be allowed to proceed because the

claim hinges on Brashear’s subjective intent, whereas the McCorpen defense is satisfied by the

lesser showing that a seaman made material misstatements or omissions. Therefore, according to

Caillou, Boudreaux’s holding that McCorpen may only serve as a defense and not an offense

does not apply when employer can prove actual, subjective intent to commit fraud. R. Doc. 47-

3 Although Caillou contends that Brashear suffered no injury due to the vessel collision, it is conceivable

that a seaman could suffer actual personal injuries but fraudulently overstate the extent of their injuries. In that

situation, a seaman may be entitled to a Jones Act award for damages. At the same time, the seaman’s employer may

be able to deduct past maintenance and cure payments from any such award.

4.4 In support, Caillou cites the original panel opinion in Boudreaux, which was later vacated,

withdrawn, and substituted with the precedential opinion. See Boudreaux, 711 F.3d 501 (5th

Cir.), vacated by 721 F.3d at 724 (5th Cir. 2013). In the vacated opinion, the panel majority

observed that, unlike common law fraud claims, which turns on the subjective intent of the

alleged wrongdoer, the McCorpen defense does not require any showing of mens rea; instead, it

is satisfied merely by showing that, prior to hiring, the seaman failed to disclose medical

information that an employer clearly sought. Id. (citing Brown v. Parker Drilling Offshore Corp.,

410 F.3d 166, 174 (5th Cir. 2005)). Because establishing McCorpen does not require

demonstrating a seaman’s intent to conceal, the Fifth Circuit, in the since-vacated opinion,

worried that transforming McCorpen’s defense into an authorization to pursue an affirmative

claim against a seaman would, in practice, threaten honest seamen who inadvertently fail to

4 Technically, this argument was pressed by the employer in Crowe v. Marquette Transp. Co. Gulf-Inland,

LLC, No. 14-1130, (E.D. La.), in a 26-page memorandum objecting to the magistrate’s denial of its motion for leave

to file its counterclaim, R. Doc. 47-3, and a 21-page memorandum opposing the seaman’s motion to dismiss its

counterclaim, R. Doc. 47-4. Caillou’s 9-page memorandum attempts to incorporate by reference these memoranda

by the employer in Crowe. R. Doc. 47 at 5-6. Caillou cites Federal Rule of Civil Procedure 10(c) as permitting this

adoption by reference. That Rule permits “[a] statement in a pleading [to] be adopted by reference elsewhere in the

same pleading or in any other pleading or motion.” Fed. R. Civ. P. 10(c) (emphasis added). By its terms, the Rule

applies only to the adoption of a statement in a pleading. The memorandum Caillou seeks to adopt, however, plainly

is not a pleading, see Fed. R. Civ. P. 7 (listing the types of pleadings), and therefore Rule 10(c) provides no basis for

Brashear to adopt by reference the arguments urged by the employer in Crowe. In addition, Brashear’s maneuvering

runs up against Local Rule 7.7. That provision states that, unless a party receives leave of court, memoranda

“supporting or opposing a motion must not exceed 25 pages, excluding exhibits[.]” E.D. La. Local Rule 7.7. To add

the entirety of the 26-page and 21-page memoranda by the employer in Crowe on top of Caillou’s own 9-page

memorandum would clearly violate this Rule.

In addition to the attempted adoption-by-reference, Brashear attached the employer’s memorandum in

Crowe as an exhibit to his memorandum. R. Doc. 47-3. And exhibits are expressly excluded from the page count

limitation imposed by Local Rule 7.7. But permitting parties to attach as exhibits documents that are purely legal

arguments—as opposed to documents that merely support the legal arguments already presented in a parties’

memoranda—would effectively sanction an end-run around Local Rule 7.7. On the other hand, this Court is not

inclined to stick its head in the sand and ignore potentially meritorious legal arguments. Accordingly, although the

Court admonishes counsel to comply with the Local Rules, the Court will consider the primary arguments asserted

by the employer in Crowe in favor of recognizing a cognizable affirmative claim for recovery by an employer

against a seaman.

disclose material information to their employer with the specter of “crushing liability”—a result

“inimical to the existing fabric of maritime law.” Id.

Subsequently, as noted, the Boudreaux panel vacated its original opinion. In its

precedential decision, the panel appeared to retreat from the view that McCorpen does not

necessitate an intent to defraud. The McCorpen defense, the Fifth Circuit stated, applies “where a

seaman procures his employment by ‘intentionally’ and ‘fraudulently’ concealing a material

medical condition causally related to the injury later sustained.” 712 F.3d at 726 (quoting

McCorpen, 396 F.2d at 549). The Fifth Circuit further stated that the “requisite quantum of proof

under McCorpen is the same as that for fraud claims.” Id. In other words, although Boudreaux

does not expressly state that McCorpen requires proof of subjective intent on the part of the

seaman to defraud his employer, Boudreaux does equate an employer’s burden of proof to

establish intentional fraud under McCorpen with that required to establish the requisite scienter

for common law fraud.

Nevertheless, Caillou argues that Boudreaux does not prohibit an employer’s

counterclaim against a seaman where the employer proves the seaman’s subjective intent to

commit fraud. R. Doc. 47-4 at 13. Caillou points out that, in Boudreaux, the employer “made a

strategic decision not to litigate the case on its facts;” instead, the employer asked the court “to

hold that any employer that establishes a McCorpen defense is automatically entitled to

restitution.” Id. at 725. Under Caillou’s reading of Boudreaux, the case merely stands for the

proposition that establishing the McCorpen defense, without more, does not per se entitle the

employer to restitution. R. Doc. 47-4 D at 13.

But Caillou itself construes Boudreaux as “appear[ing] to recognize [that] the intentional

concealment component of the McCorpen test is akin to common law fraud,” which requires a

showing of subjective intent to defraud. Id. at 13. More importantly, Boudreaux’s broader

teaching is that courts should proceed with great caution before “creating a right of action never

before recognized in maritime law” given the existing scheme that carefully balances the

interests of seamen against those of their employers. 721 F.3d at 724. Yet, that is precisely what

Caillou urges here—without citation to a single reported decision recognizing the right it asserts.

Indeed, Caillou asks this Court to go far beyond authorizing the type of claim the Fifth Circuit

rejected in Boudreaux. That case concerned a claim to recoup maintenance and cure fees. But

here, Caillou makes a much more expansive claim: it seeks, in addition to maintenance and cure

payments, reimbursement for fees and expenses associated with investigating and defending

Brashear’s claim, increases in its insurance premiums, and harm to its reputation and business. R.

Doc. 28 at 10-14. This certainly would create a new right of action never before recognized by

maritime law—an outcome the Firth Circuit rejected in Boudreaux.

Caillou’s final argument concerning Boudreaux’s inapplicability is that the decision is

inconsistent with the Fifth Circuit’s prior decision in Withhart v. Otto Candies, L.L.C., 431 F.3d

840 (5th Cir. 2005), and that one of these decisions must be “overturned.” R. Doc. 47-4 at 19.5

Needless to say, this Court does not have the power to overturn the Fifth Circuit. In any event,

this argument rings hollow because the two cases are distinguishable.

Withhart held that a Jones Act employer could sue its seamen-employee for property

damage under a negligence theory. 431 F.3d at 845. First, the Fifth Circuit determined that,

under general maritime law, vessel owners could sue negligent seamen for property damage. Id.

at 842. Second, the Fifth Circuit determined that the Jones Act did not bar such a counterclaim

for property damage, and therefore the counterclaim was viable. Id. at 845. In reaching its

5 Caillou also makes this argument via its “incorporation” of the employer’s memorandum in Crowe, No.

14-1130, (E.D. La.).

conclusion, the Fifth Circuit agreed with every other federal appeals court that FELA (and thus

the Jones Act, which imports FELA caselaw) did not abrogate an employer’s common law right

to sue its employees for property damage. Id. at 843.

It is true that Withhart and Boudreaux reached opposite conclusions about the

cognizability of counterclaims asserted by Jones Act employers against their employees. But

there is good reason for the divergent outcomes in these cases: they address fundamentally

different types of counterclaims. Withhart, on the one hand, concerned the viability of a

negligent property damage counterclaim against a seaman—a cause of action long recognized by

general maritime law. And this counterclaim, Withhart explained, was consistent with the Jones

Act. That determination was based in part on the Fifth Circuit’s finding that permitting the

counterclaim would not chill Jones Act seamen from pressing their statutory rights—a

conclusion that makes sense given that a property damage counterclaim would generally arise

out of a different set of operative facts than a seaman’s Jones Act claims and thus is not likely to

be asserted by an employer merely as a retaliatory response to a seaman’s Jones Act claims. 431

F.3d at 842.

Boudreaux, by contrast, dealt with a counterclaim for fraud by a seaman’s employer

brought in response to the seaman’s personal injury claims—a counterclaim without precedent in

maritime law. That this fraud-based counterclaim found little support in the caselaw was

unsurprising: judicially licensing such counterclaims could seriously impair seamen’s ability to

assert their rights, a result that would conflict with courts’ historic duty to safeguard seamen’s

rights. See Harden, 11 F. Cas. at 485. Unlike the negligent property damage counterclaim in

Withhart, if a fraud counterclaim could go forward, then every time that a seaman sues his

employer under the Jones Act, the employer would simply turnaround and countersue, asserting

that the seaman’s personal injury claims are fraudulent. The mere threat of this counterclaim

could cow a seaman into foregoing otherwise meritorious claims. Thus, whereas Withhart found

that allowing a negligent property damage counterclaim would not deter seamen from upholding

their rights, Boudreaux understandably expressed concern that authorizing fraud counterclaims

against Jones Act seamen may thwart seamen’s ability to recover or even bring a Jones Act

claim—an outcome that would be at odds with the Jones Act’s liberal policy of providing relief

for injured seaman. 721 F.3d at 724.

In sum, although at first blush there may appear to be some tension in the reasoning of

Boudreaux and Withhart, upon closer scrutiny, the cases can be harmonized. And Boudreaux,

which deals directly with the inviability of a novel counterclaim by a Jones Act employer based

on a seamen’s alleged fraud, is the more pertinent and relevant decision.

The Court bears in mind that Boudreaux addresses the cognizability of an affirmative

claim for relief by a Jones Act employer when a seaman allegedly intentionally misleads his

employer about a pre-existing injury whose disclosure would have been material to the hiring

decision. The precise issue presented here is somewhat different: the cognizability of a Jones Act

employer’s fraud claim asserted against a seaman for allegedly intentional misrepresenting

whether the injury that he complains of occurred as a result of his service on a vessel. The Court

has located only a handful of cases confronting this latter issue. Overall, those decisions support

the Court’s determination that Caillou’s counterclaim must be dismissed.

The most on point case is Dolmo v. Galliano Tugs, Inc., No. 09-3976, 2011 WL 6817824,

*1 (E.D. La. Dec. 28, 2011), aff’d sub. nom in Dolmo v. Tugs, 479 F. App’x 656 (5th Cir. 2012).

There, a seaman sued his employer under the Jones Act and general maritime law. Id. at *1. The

employer countersued to recover attorneys’ fees and costs, contending that the seaman fabricated

the accident upon which he sued. The Dolmo court, in a decision cited favorably by Boudreaux,

rejected the employer’s claim largely based on historical and policy reasons. The court

recognized that, although recovery of maintenance and cure payments to the seaman was “not

the exact issue” before it, “that issue presents in lesser form some of the fundamental problems

inherent in this counterclaim[.]” Id. at *2. The court viewed “[t]he problems with the potential

ramifications of recognizing this counterclaim for fraud” as “exponentially enhanced from those

associated with the mere repayment of maintenance and cure.” Id. Moreover, the threat of a suit

for fraud in response to a personal injury claim by a seaman “seriously undercuts the historical

rationale and the very deference the admiralty gives its ward of the court.” Id. The court also

worried that recognizing the employer’s claim would result in attorneys refusing to represent

injured seamen.6 Id.

Similarly, in Whitchurch v. Canton Marine Towing Co., No. 16-3278, 2018 WL

3213137, at *2 (C.D. Ill. June 29, 2018), the court held that a Jones Act employer could not

clawback maintenance and cure payments by pursuing a fraud counterclaim against a seaman

who the employer alleged had fabricated the injury and accident sued upon. The court

acknowledged that, unlike in the McCorpen line of cases, which concern fraud during the hiring

process, it was confronted with fraud related to the occurrence of the accident and the injury

itself. Id. But the court determined that the “general principles” enunciated in Boudreaux for

prohibiting employers from asserting affirmative causes of actions against seamen applied to that

case, too. Id. at *3. The court also cited the paucity of precedent supporting the employer’s cause

of action and expressed concern that permitting counterclaims by Jones Act employers would

chill seamen from asserting their rights under maritime law. Id.

6 As an additional reason supporting its conclusion, the Dolmo court noted that the employer had available

the McCorpen defense.

Conversely, in Crowe v. Marquette Transp. Co. Gulf-Inland, LLC, No. 14-1130, R. Doc.

90 at 1 (E.D. La. May 5, 2015), a district court permitted an employer to assert a counterclaim

for fraud against a seaman. In a two-paragraph Order and Reasons, the district judge overruled

the magistrate’s recommendation that the fraud claim was not cognizable. Deeming the issue a

“close call,” the district court distinguished Boudreaux because the plaintiff in that case

“undisputedly suffered an injury” while performing his duties as a seaman, whereas the employer

in Crowe contended that the seaman did not suffer an on-the-job injury. Id.; see also id. at R.

Doc. 143 (denying seaman’s motion to dismiss employer’s counterclaim for the same reasons

provided in the order granting leave to amend).7

Although the Court agrees with Crowe that the issue presented is a difficult one, the

Court ultimately must side with the conclusions in Dolmo and Whitchurch that a Jones Act

employer cannot be allowed to maintain a cause of action for damages against its seaman based

on fraud in retaliation or response to a seaman’s suit for maintenance and cure or damages.

While a Jones Act employer—like Caillou in this case—may assert that its counterclaim for

fraud is merely intended to recover the costs incurred in defending against supposedly dishonest

claims, such a result is doubtful; in actuality, recovery on such a counterclaim would be highly

unlikely due to the impecunious status of the average seaman; so the only purpose of allowing

such a claim would be to serve as a threat to a seaman who files a claim which the Jones Act

preserves. Furthermore, a ruling allowing such a claim would likely open the floodgates of

7 In a sur-reply, Caillou attached a Findings of Fact and Conclusions of Law as well as a Judgment in civil

action no. 83-1465, E.D. La., Guidry v. Bengal Marine, Inc. (Apr. 25, 1986). In that case, a plaintiff-seaman sued his

Jones Act employer for injuries he allegedly sustained onboard his employer’s vessel, and the employer countersued

for fraud. The jury, through interrogatories, found that the seaman’s personal injury claims were based on false

representations. Thus, the jury found that the seaman was not entitled to the maintenance and cure payments that he

had received. The district court therefore granted judgment to a vessel owner on its counterclaim. R. Doc. 65-1.

Although the court in that case did award an affirmative recovery to the employer against its seaman, there is no

indication that the seaman ever contested whether the counterclaim against him was cognizable.

litigation to disgruntled vessel owners who take extreme umbrage over being sued by their own

crew members. In nearly every case in which a seaman claims injury due to vessel negligence or

unseaworthiness, the vessel owner denies liability and causation. Essentially, the vessel owner

disputes the statement or testimony of the seaman as to how he was injured, the nature and extent

of his claimed injuries, and often claims that if there were any injuries, they were likely caused

by prior incidents or prior disabilities unknown to the employer. These positions would spawn

counterclaims based on fraud in nearly every case.

Under the present regime the vessel owner who prevails at trial as a result of a finding of

no negligence or no unseaworthiness or a lack of causation pays nothing. No damages are

assessed, and any court costs or attorney fees are usually paid by insurance, the cost of which is

passed on to the consumer of the vessel owner’s services. This approach has held for decades,

and the case for creating a new right of action has not been made. The nearly complete absence

of caselaw approving of the counterclaim asserted here in response to a seaman’s Jones Act

claim militates strongly in favor of dismissing the counterclaim. Id. at 728. (“[W]e are not so

bold as to now claim a new view—one that the hundreds before us have overlooked or

rejected.”). So, too, do the serious misgivings articulated in Dolmo and Crowe about the

deleterious effects that would result from permitting the type of counterclaim pressed here. As

those courts observed, authorizing the affirmative right of action sought by the employer may

well dissuade seamen from asserting their rights, either by causing them not to press meritorious

claims or deterring counsel from taking on their cases. Although the scenario here is factually

distinguishable from that in Boudreaux, this Court heeds the Fifth Circuit’s admonition in that

case that courts should be reticent to recognize rights of action that are novel in maritime law,

particularly when they would likely adversely affect the established rights of seamen.8 721 F.3d

at 724.

Notably, barring a Jones Act employer from countersuing its seamen for fraud is

consistent with the history and policy of the Jones Act itself. That statute arose out of the

shortcomings of an earlier congressional enactment, a 1915 measure intended “to promote the

welfare of American seamen . . . and to promote safety at sea.” 38 Stat. 1164 (1915), codified at

46 U.S.C. § 50101 et seq; see also GRANT GILMORE AND CHARLES L. BLACK, JR., THE LAW OF

ADMIRALTY, (2d ed. 1975), at 325-27 [hereinafter, “THE LAW OF ADMIRALTY”]. In one

provision, Congress sought to provide a cause of action for a mariner injured as a result of the

negligence of his vessel’s master or crew. Specifically, Congress prohibited application of the

so-called “fellow-servant doctrine”—a rule that imputed the negligence of each member of the

crew to all and was perceived as a bar to recovery for maritime negligence claims—to suits for

injuries sustained by seamen aboard vessels. THE LAW OF ADMIRALTY at 325. Despite Congress’s

intent to remove any barriers to a seaman’s ability to recover for negligence claims, the Supreme

Court, in Chelentis v. Luckenbach S.S. Co., interpreted the 1915 statute’s bar to applying the

fellow-servant rule as “irrelevant” to a seaman’s recovery; rather, the Court held that

longstanding jurisprudence limited a seaman’s recovery to maintenance and cure only. 247 U.S.

372, 381, 384-85 (1918) (citing The Osceola, 189 U. S. 158, 175 (1903)). The decision left

seaman without legal recourse—other than mere maintenance and cure—for the negligence of

their master or crew.

8 Although not directly on-point, the limited scholarly treatment of related issues appears to be in accord.

See David W. Robertson & Michael F. Sturley, Recent Developments in Admiralty and Maritime Law at the

National Level and in the Fifth and Eleventh Circuits, 41 TUL. MARITIME L. J. 437, 490 n.357 (2017) n. 357

(explaining that when a seamen is alleged to have “faked his injuries, . . . [i]t seems likely (and dicta in Boudreaux []

suggests) that” the employer’s overpayment to the seamen “will be treated analogously to Boudreaux” and therefore

no affirmative recovery will be permitted).

Congress responded swiftly, enacting the Jones Act in 1920. Merchant Marine Act of

1920, Pub. L. No. 261 (1920). As part of its overarching goal of promoting the growth of the

nation’s “foreign and domestic commerce,” the Jones Act conferred upon seamen the negligence

cause of action against their employers that Congress had attempted to provide several years

earlier. 41 Stat. 1007 (1920), codified at 46 U.S.C. § 30104 et seq. In establishing an affirmative

right of recovery for seaman against their employers for negligence, Congress codified in

admiralty law a fundamental tenet of tort theory: that the costs of a harm should be placed on the

party best positioned to prevent the harm. By requiring vessel owners and operators to internalize

the costs of unsafe vessel conditions, Congress incentivized these employers to provide their

seamen with safe workplaces. In this way, the Jones Act promotes the well-being of seamen—a

chief purpose behind the 1915 statute. The Jones Act thus cures inadequacies in the 1915 statute

vis-à-vis the protection of seaman’s rights and, in turn, their safety. And in so doing, the Jones

Act encourages the development of the maritime industry, thereby advancing national

commerce—a further goal of the statute. See 41 Stat. 1007.

To permit the counterclaim asserted by the Jones Act employer here would chip away at

the Act’s purpose. As discussed, this counterclaim would discourage seaman from pursuing their

rights under the Jones Act. And, as tort theory teaches, employers would thus have a diminished

economic incentive to encourage safe conditions on their vessels. That result would frustrate the

Jones Act’s purposes of promoting maritime safety and national commerce.9 The Court thus

finds that barring the Jones Act employer’s counterclaim for fraud best effectuates the statute’s

broad aims of promoting maritime safety and, consequently, maritime commerce.

9 This caption accompanied the original 1915 Act. In 1920, the Jones Act amended the 1915 Act to further

enumerate seamen’s rights. See Grant Gilmore & Charles L. Black, THE LAW OF ADMIRALTY, 325 (2d ed. 1975).

Accordingly, though Caillou may decry the balance the courts have struck between the

rights of Jones Act employers and their seamen, this Court does not find occasion to upset it. To

the extent that the Fifth Circuit in Boudreaux may not have entirely foreclosed the possibility of

an affirmative recovery by a Jones Act employer that Caillou seeks here, “[t]he case for

exercising” this Court’s “extraordinary power to create a new right of action has not been made.”

Id. at 728.10

2. Brashear’s Motion to Dismiss CGT’s Counterclaims, R. Doc. 49

Brashear also moves to dismiss each of CGT’s counterclaims under Rule 12(b)(6). R.

Doc. 49. First, Brashear contends that dismissal of CGT’s fraud and intentional

misrepresentation claims is appropriate because CGT fails to meet the heightened pleading

requirements for such claims under Rule 9(b). R. Doc. 49-1 at 1, 6-7. Id. at 6-7. Second,

Brashear argues that CGT’s malicious prosecution claim is premature. Id. at 7-9.11

Under Federal Rule of Civil Procedure 9(b), a party alleging fraud “must state with

particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and

other conditions of a person’s mind may be alleged generally.” The Fifth Circuit “interprets Rule

9(b) strictly, requiring a plaintiff [who pleads] fraud to specify the statements contended to be

fraudulent, identify the speaker, state when and where the statements were made, and explain

why the statements were fraudulent.” Dorsey v. Portfolio Equities, Inc., 540 F.3d 333, 339 (5th

10 Because Caillou’s counterclaim is not cognizable, the Court need not consider Brashear’s alternative

argument that the claim should be dismissed for failing to the meet the heightened leading requirements for claims

of fraud.

11 Notably, Brashear does not argue that Boudreaux bars CGT’s counterclaims. Presumably, that is because

CGT is not Brashear’s employer. Accordingly, the concerns that permitting a Jones Act employer to countersue its

seaman for fraud may preclude a seaman from asserting his rights under that statute are not implicated by CGT’s

counterclaims.

Cir. 2008) (citations omitted). “Put simply, Rule 9(b) requires the complaint to set forth the

‘who, what, where, and how of the events at issue.’” Id. (citation omitted).

The Court first considers CGT’s counterclaim for fraud. CGT alleges that, on or around

November 17, 2020, Brashear “was already being treated for the same conditions and injuries for

which he now alleges were a result of the November 26, 2020 collision.” R. Doc. 34 at ¶3. CGT

also alleges that “Brashear treated for his alleged claims of injury from November 26, 2020

without disclosing the pre-existing conditions and injuries” and “concealed and misrepresented

them as being from the . . . collision.” Id. ¶4. However, CGT fails to identify when and to whom

Brashear’s allegedly fraudulent statements were made. See Dorsey, 540 F.3d at 339. CGT

therefore has not satisfied the heightened requirements of Rule 9(b). See id.12

Turning to CGT’s intentional misrepresentation claim, “[t]he elements of a Louisiana

delictual fraud or intentional misrepresentation cause of action are: (a) a misrepresentation of a

material fact, (b) made with the intent to deceive, and (c) causing justifiable reliance with

resultant injury.” Guidry v. U.S. Tobacco Co., 188 F.3d 619, 627 (5th Cir. 1999). Because such a

claim includes the elements of fraud, it is subject to the pleading hurdles imposed by Rule 9(b).

See, e.g., Coleman v. Sears Home Improvement Prods., Inc., No. 16-2537, 2017 WL 1089580,

*10 (E.D. La. Mar. 21, 2017); Schafer v. State Farm & Fire Casualty Co., No. 06-8262, 2008

WL 11353621, *1 (E.D. La. June 11, 2008); Dorsey v. N. Life Ins. Co., No. 04-0342, 2005 WL

12 Brashear takes issue with CGT alleging its fraud claim “on information and belief.” R. Doc. 49-1 at 2, 7.

“If the facts pleaded in a complaint are peculiarly within the opposing party’s knowledge, fraud pleadings may be

based on information and belief. However, this luxury may not be mistaken for license to base claims of fraud on

speculation and conclusory allegations.” Dorsey, 540 F.3d at 339 (quoting Tuchman v. DSC Commc’ns Corp., 14

F.3d 1061, 1068 (5th Cir. 1994)). Rather, the pleading “must set forth a factual basis for such belief.” United States

ex rel. Thompson v. Columbia/HCA Healthcare Corp., 125 F.3d 899, 903 (5th Cir. 1997). CGT’s counterclaim does

not provide a factual basis for its allegations concerning Brashear’s alleged fraud. Any future fraud claim pled on

information and belief must furnish a factual basis for such allegations.

2036738, *9-10 (E.D. La. Aug. 15, 2005). Indeed, it is unclear how CGT’s fraud claim is distinct

from its claim for intentional misrepresentation. In any event, assuming these claims are distinct,

the intentional misrepresentation claims fails to satisfy Rule 9(b) for the same reasons its fraud

claim falls short.

Last is CGT’s counterclaim for malicious prosecution. “Under Louisiana law, a malicious

prosecution claim requires: 1) the commencement of an original criminal or civil judicial

proceeding; 2) its legal causation by the present defendant against the present plaintiff who was

the defendant in the original proceeding; 3) its bona fide termination in favor of the present

plaintiff; 4) the absence of probable cause for such proceeding; 5) the presence of malice therein;

and 6) damages conforming to legal standards resulting to the plaintiff.” St. Paul Mercury Ins.

Co. v. Williamson, 224 F.3d 425, 435 (5th Cir. 2000) (citing Hibernia Nat’l Bank v. Bolleter, 390

So. 2d 842, 843 (La. 1980)). CGT concedes that this cause of action “appears premature.” R. Doc. 52

at 12. The Court agrees. The present case concerning Brashear’s injury claims has not terminated, let

alone concluded in CGT’s favor. Thus, as a matter of law, CGT cannot prevail on its malicious

prosecution claim against Brashear while the current litigation proceeds.

CGT indicates that it will request leave to amend if its fraud or intentional

misrepresentation claims are inadequate. R. Doc. 52 at 12. Although the deadline for

amendments to pleadings passed somewhat recently, see R. Doc. 69, the Court will grant CGT

leave to amend given that the submission date for the motion to dismiss predated the deadline for

amendments. CGT must file any amended pleading within 10 days of the entry of this Order.

CONCLUSION

For these reasons,

IT IS ORDERED that claimant Brashear’s motion to dismiss Caillou’s

counterclaims, R. Doc. 41, is GRANTED. Caillou’s counterclaims against Brashear are

hereby DISMISSED with prejudice.

IT IS FURTHER ORDERED that claimant Brashear’s motion to dismiss CGT’s

counterclaims, R. Doc. 49, is GRANTED in part. CGT’s malicious prosecution

counterclaim against claimant Brashear is DISMISSED with prejudice. CGT’s fraud and

intentional misrepresentation claims against Brashear are DISMISSED without

prejudice.

IT IS FURTHER ORDERED that CGT is granted 10 days to amend its

counterclaims against Brashear.

New Orleans, Louisiana, this 18th day of August, 2022.

UNITED STATES DISTRICT JUDGE

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