# Petition for Writ of Certiorari — Sample v. Johnson

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1986
- **Citation:** 475 U.S. 1019

## Text

CLERK

Supreme Court, J.S.
ms) iL 8D

oo L163 DEC 80 1985

JOSECH F. SPANIOL, JR.

IN THE SUPREME COURT
of the
UNITED STATES

October Term, 1985

WILLIAM SAMPLE and KAREN SAMPLE, husband and
wife, and JAMES SHELTON,
Petitioners,

Vv.

REGINALD JOHNSON, Deputy Commissioner for
the Office of Workers' Compensation Programs
for District 14; and SEATTLE STEVEDORE
COMPANY; and EDWARD LOPIT; and PAUL TOMITA;
and NAHUM LITT, Chief Administrative Law
Judge, Office of Administrative Law Judges;
and RAYMOND DONOVAN, United States Secretary
of Labor,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
pat 0 FOR. THE NINTH CIRCUIT

SCOTT E. STAFNFE

STAFNE & WETZEL
1111 Smith Tower
Seattle, WA 98104
(206) 621-1113

Counsel to Petitioners

An
75
, \F

——

——

QUESTIONS PRESENTED FOR REVIEW
ae Did the Court of Appeals err in
affirming the district court's judgment
that it had no admiraity jurisdiction
under 28 U.S.C. 1333 to consider
longshoremen's allegations that they
were damaged by defendant self-
insurer's bad faith violations of the
Longshoremen's and Harbor Workers' Act

(LHWCA) and breach of duties imposed by

general maritime law?

2. Was the Court of Appeals correct in its
decision that the exclusivity and
penalty provisions of the LHWCA barred
longshoremen's actions against
defendant self-insurer for damages
arising out of injuries not covered by

the LHWCA?

ii

PARTIES

Parties to the appeal sought: to be
reviewed include a.) federal defendants:
Reginald Johnson, Deputy Commissioner for
the Office of Worker Compensation Programs
for District 14, Nahum Litt, Chief
Administrative Law Judge, and Raymond
Donovan, United States Secretary of Labor;
and b.) private defendants: Seattle
Stevedore Company, Edward Lopit, and Paul
Tomita. Only that portion of the Court of
Appeal's judgment relating to the private

defendants is sought to be reviewed.

iii

TABLE OF CONTENTS

Page
QUESTIONS PRESENTED .....-+ +s « i
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8 Ga eo ee ee ee a ee ee Vv
EES a ee ee ee ee ee ee ee Vv
OTHER AUTHORITY . . . +. © © © © «© @ «+ Vv
GPimsewe BELOW . 2. it ew te te tl tl 1
es ee ee a ee ee 1
CONSTITUTIONAL PROVISIONS ..... . 2
es Ee a ee ee er a re 3
STATEMENT OF CASE ...++:+ se «2 = IQ
REASONS FOR ALLOWING THE WRIT... . 16
re Gc 6 & & ee 08 6 os os «Ors

TABLE OF AUTHORITY
Table of Cases
American Export Lines, Inc. v. Alvez,
466 U.S. 274 (3960) . « «© «© © © © © @ 29
Crowell v. Benson, 285 U.S. 22
ok . - sb se &» « = 6s s 6 8 ltl lle EG, BS

Director, OWCP v. Perini North River
Associates, 459 U.S. 297 (1983) is ieee

iv

Detroit Trust Co. v. Steamer
“THOMAS BARLUM", 293 U.S. 21

(1934) . «© «© © s © © © ow 22
Giacona v. Capricorn Shipping Co.,

394 F.Supp. 1189 (1975) ee 20
Herb's Welding Inc. v. Grey, 105

S$.ct. 1421, U.S. (1985) 23,25
Martin v. Travelers Ins. Co., 497

F.2d 329 (ist Cir. 1974) .... . 23,24,28
Mobile Oil Corp. v. Higginbotham,

436 U.S. 618 (1978) cies So % 26,27
Moragne v. States Marine Lines,

398 U.S. 375 (1970) 29
Myhran v. Johns-Manville Corp.,

741 F.2d 1119 (9th Cir. 1984) 20,21
Northeast Marine Terminal Co. v.

Caputo, 432 U.S. 249 (1977) 23
P.C. Pfeiffer Co. v. Ford, 444 U.S.

69 (1979) ; 6 tt se te ee 8 23,25

Romero v. International Term

Operating Co., 358 U.S. 354 (1959) .16,18,23

Sample v. Johnson, 771 F.2d i335
(1985) (Lae ~ete mtn. «©

Seas Shipping Co. v. Sieracki,
328 U.S. 85 (1946)

Stafford v. Westchester Fire Ins. Co.,
526 P.2d 37 (1974)

29

27

Washington v. W.C. Dawson Co.,

264 U. 219 (1924) 16,21
PROVISIONS
u.S. Const., Article III, Section 2,
Sea. i pee re eae 2,20
STATUTES
28 U.S.C. Section 1254(1) 2
28 U.S.C. Section 1331 “3, 10, 18
28 U.S.C. Section 1333 4, 10, 15, 16,17,18,19
28 U.S.C. Section 1361 : 4,10
33 U.S.C. Section 901 . » 4&6
33 U.S.C. Section 902(2) 5,26
33 U.S.C. Section 904 as
33 U.S.C. Section 905(a) 5,24
33 U.S.C. Section 907(a) . =» * 7
33 U.S.C. Section 914(e) and (£). 7,24,26
33 U.S.C. Section 928(a) 9,26
CTHER AUTHORITY
1 Benedict on Admiralty, Section 102,
pp. 7-4 to 7-5 (1985) 18,20
2(a) Larson Workmen's Compensation
Law, Section 65.40, at 12-25 thru
12-32 (1985) 24

YPINIONS BELOW

The judgment of the Ninth Circuit Court
of Appeals is reported at 771 F.2d 1335
(1985). The judgment of the United States
District Court for the Western District of
Washington giving rise to the appeal is not
reported in the Federal Supplements, but is
reported at 16 BRBS 146 (1984). Both
opinions are reproduced in the Appendix to

this Petition.

JURISDICTION
(i) The Ninth Circuit Court of Appeals

filed its judgment in Sample, et al. _v.

Johnson, et al., 771 F.2d 1335 (1985) on

September 20, 1985.

(ii) The order denying the plaintiff's
petition for rehearing was filed on October
25, 1985.

(iii) No cross-petition for writ of

certiorari has been filed.

(iv) Statutory authority conferring
jurisdiction on the United States -Supreme
Court to review the judgment in question by
writ of certiorari is premised upon 28

U.S.C. Section 1254(1).

CONSTITUTIONAL PROVISIONS
The following Constitutie»sl provisions
are involved: The United States
Constitution, Article III, Section 2, cl. 1,
states:

"The judicial Power shall extend
to all Cases, in Law and Equity,
arising under this Constitution,
the Laws of the United States, and
Treaties made, or which shall be
made, under their Authority,--to
all Cases affecting Ambassadors,

other public Ministers and
Consuls;--to all Cases of
admiralty and maritime
Jurisdiction;--to Controversies

between two or more States;--
between a State and Citizens of
another State;--between citizens
of different States ,--between
citizens of the same State
Claiming Lands under Grants of
different States, and between a
State, or the Citizens thereof,

and foreign States, Citizens or
Subjects."

STATUTES

28 U.S.C. Section 1331 - Federal question;

amount in controversy; costs:
(a) The district courts shall have original
jurisdiction of all civil action wherein the
matter in controversy exceeds the sum or
value of $10,000, exclusive of interest and
costs, and arises under the Constitution,
laws, or treaties of the United States,
except that no such sum or value shall te
required in any such action brought against
the United States, any agency thereof, or
any officer or employee thereof in his

official capacity.

28 U.S.C. Section 1333 - Admiralty, maritime
and prize cases:

The district court shall have original
jurisdiction, exclusive of the courts of the

States, of:

(1) Any civil case of admiralty or
maritime jurisdiction, saving to
suitors in all cases all other remedies

to which they are otherwise entitled.

(2) Any prize brought into the United
States and all proceedings for the
condemnation of property taken as
prize.

28 U.S.C. Section 1361 - Action to compel an

officer of the United States to
perform his duty:

The district courts shall have original
jurisdiction of any action in the nature of

mandamus to compel an officer or employee of

the United States or any agency thereof to

perform a duty owed to the plaintiff.

33 U.S.C. Section 902(2) - Definition of
injury:

(2) The term "“injury" mans accidental
injury or death arising out of andin the
course of employment, and such occupational
disease or infection as arises naturally out
of such employment or as naturally or
unavoidably results from such accidental
injury and includes an injury caused by the
willful act of a third person directed
against an employee because of his
employment.

33 U.S.C. Section 905 - Exclusiveness of
liability:

(a) The liability of an employer prescribed
in section 4 [33 U.S.C. Section 904] shall
be exclusive and in place of all other
liability of such employer to the employee,

his legal representative, husband or wife,

parents, dependents, next of kin, and anyone
otherwise entitled to recover damages from
such employer at law or in admiralty on
account of such injury or death, except that
if an employer fails to secure payment of
compensation as required by this Act, an
injured employee, or his legal
representative in case death results from
the injury, may elect to claim compensation
under the Act, cr to maintain an action at
law or in admiralty for damages on account
of such injury or death. In such action
the defendant may not plead as a defense
that the injury was caused by the negligence
of a fellow servant, or that the employee
assumed the risk of his employment, or that
the injury was due to the contributory

negligence of the employee.

33 U.S.C. Section 907(a) - Medical services
and supplies:

(a) General Requirement. The employer
shall furnish such medical, surgical, and
other attendance or treatment, nurse _ and
hospital service, medicine, crutches, and
apparatus, for such period as the nature of
the injury or the process of recovery may
require.

33 U.S.C. Section 914(e) and (f) - Payment
of compensation:

(e) If any installment of compensation
payable without an award is not paid within
fourteen days after it becomes due, as
provided in subdivision (b) of this section,
there shall be added to such unpaid
installment an amount equal to 10 per centum
thereof, which shall be paid at the same
time as, but in addition to, such
installment, unless notice is filed under

subdivision (d) of this section, or unless

eit iiiitaincaiaiaaaiinine

such non-payment is excused by the deputy
commissioner after a showing by the employer
that owing to conditions over which he had

no control such installment could not be

paid within the period prescribed for’ the
payment.

(f) If any compensation, payable under’ the
terms of an award, is not paid within ten
days after it becomes due, there shall be
added to such unpaid compensation an amount
equal to 20 per centum thereof, which shail
be paid at the same time as, but in addition
to, such compensation, unless review of the
compensation order making such award is had
as provided in section 21 and an order
staying payments has been issued by the

Board or court.

33 U.S.C. Section 928(a) - Fees for Services

(a) If the employer or carrier declines to
pay any compensation on or before the
thirteenth day after receiving written
notice of a claim for compensation having
been filed from the deputy commissioner, on
the ground that there is no liability for
compensation within the provisions of this
Act, and the person seeking benefits shall
thereafter have utilized the services of an
attorney at law in the successful
presecution of this claim, there shall be
awarded, in addition to the award of
compensation, in a compensation order, a
reasonable attorney's fee against the
employer or carrier in an amount approved by
the deputy commissioner, Board, or court, as
the case may be, which shall be paid
directly by the employer or carrier to the
attorney for the claimant in a lump sum

after the compensation order becomes final.

10

STATEMENT OF THE CASE

a.} Jurisdiction

This action was brought by two
longshoremen in the District Court of the
Western District of Washington against
federal defendants responsible for
administering the adjudication of claims
filed pursuant to the LHWCA, 33 U.S.C.
Section 901, et seq., and the self-insurer
responsible for handling longshoremen's
claims to benefits under the LHWCA.
Paragraph 1 of the longshoremen's complaint

alleged that:

"1. This action arises under’ the
Longshoremen's and Harbor Workers'

Compensation Act, 33 U.S.C.
Section 901, et seq. .. and under

the admiralty and maritime law, as
hereinafter more fully appears.
This court has jurisdiction under
28 U.S.C. Sections 1331, 1333, and
1362."

The longshoremen asserted in other
allegations of their complaint that the

federal defendants had violated the LHWCA by

11

failing to hold hearings on their claims
within the time periods mandated by the Act.
Against the private self-insurer, the
longshoremen alleged that the bad faith
handling of their compensation claims had
caused them injuries. In this regard, the
longshoremen specifically averred that the
private defendants had knowingly and in bad
faith violated the LHWCA and the general
maritime common law.
b.) Facts

William Sample and James Shelton are
longshoremen. Sample injured his back while
working as a longshoreman on March 28, 1983.
Shortly after his injury, he filed a claim
for medical and compensation benefits
against his employer, Seattle Crescent
Container Corp., under the LHWCA. Seattle
Stevedore Company, the self-insurer arm of
his employer, initially began paying

compensation and medical benefits under’ the

12

LHWCA. When Sampie's back condition did not
improve, his treating physician recommended
that he undergo a type of back surgery
requiring hospitalization. Sample secured
authorization from Seattle Stevedore under
Section 7 of the Act to undergo this
treatment. Thereafter, Sample was
hospitalized and underwent surgery. Shortly
after Sample was released from the hospital,
Seattle Stevedore controverted his LHWCA
claim and refused to pay for his
hospitalization or any follow-up care
relating thereto. When Seattle Stevedore
refused to follow the informal
recommendation of the deputy commissioner to
pay compensation and medical benefits,
Sample sought an expedited hearing before
the Office of Administrative Law Judges to
resolve the issue. While waiting for’ the
hearing, Sample was without income and could

not obtain adequate therapy. A hearing was

13

finally held on his claim on March 17, 1984,
and on April 24, 1984, an administrative law
judge ordered the employer to pay Sample his
medical costs and compensation under the
Act. Sample claimed the failure to provide
him medical benefits and compensation caused
him emotional distress and other injuries.
James Shelton was injured on April 26,
1982, while in the course of his employment
as a longshoreman. Shortly thereafter, he
filed a timely claim for benefits. At
first, Seattle Stevedore paid him full
compensation, but later reduced his
compensation’ payments substantially. When
Seattle Stevedore refused to comply with the
informal recommendation of the deputy
commissioner to raise his benefits to their
previous level, Shelton requested an
expedited hearing before the Office of
Administrative Law Judges. This request was

made on January 28, 1983. On May 20, 1983,

14

Seattle Stevedore controverted the claim and
stopped payment of compensation altogether.
A hearing was finally held by the Office of
Administrative Law Judges on October 27,
1982. Approximately four months later, on
February 15, 1984, the administrative law
judge found that Shelton was permanently
partially disabled and entitled to
compensation. During the time that
Shelton's compensation was reduced and
finally discontinued, his family depleted
its savings, was threatened with eviction,
and lost its real estate holdings. Shelton
complained this caused him emotional
distress and other injuries.
c.) Proceedings Below

Seattle Stevedore moved for dismissal
of the longshoremen's claim pursuant to Rule
12(b)(6) on the grounds that longshoremen's
allegations of injuries stemming from bad

faith violations of the LHWCA and breaches

a

15

of duties imposed by maritime common iaw did
not state a claim upon which relief could be
granted. Thereafter, Seattle Stevedore also
asserted that the district court had no
admiralty jurisdiction over the
longshoremen's claim. The longshoremen
responded to Seattle Stevedore's motion to
dismiss and filed their own motions for
summary judgment to establish that Seattle
Stevedore had violated the LHWCA and
maritime common law. The district court did
not reach the issue of whether Seattle
Stevedore had committed bad faith violations
of the Act, as it held longshoremen had no
cause of action for injuries stemming from
bad faith violations of the LHWCA. The
district court also held there was no
admiralty jurisdiction under 28 U.S.C.
Section 1333 of the longshoremen's claims
against Seattle Stevedore and that the

exclusivity and penalty provisions of the

16

LHWCA barred any action against Seattle
Stevedore.

On appeal, the Ninth Circuit Court of
Appeals affirmed the District Court's
holding that there was no jurisdiction of
longshoremen's claims against Seattle
Stevedore under 28 U.S.C. Section 1333 and
that the exclusivity and penalty clauses

barred these longshoremen's actions.

REASONS FOR ALLOWING THE WRIT

I. THE NINTH CIRCUIT'S HOLDING THAT
ADMIRALTY JURISDICTION DOES NOT
AUTOMATICALLY ATTACH TO A CLAIM FOUNDED
UPON VIOLATIONS OF THE LHWCA (A FEDERAL
MARITIME STATUTE) IS CONTRARY TO THIS
COURT'S DECISIONS IN ROMERO V.
INTERNATIONAL TERM OPERATING CO., 358
U.S. 354 (1959), CROWELL V. BENSON, 285
U.S. 22 (1931), AND WASHINGTON V. _ W.C.
DAWSON CO., 264 U.S. 219 (1924).

This petition raises the question

whether admiralty jurisdiction attaches to a

Claim alleging the violation of a maritime

17

statute. The District Court, pursuant to a
motion by the private defendants, held that
there was no jurisdiction under 28 U.S.C.
Section 1333 of the longshoremen's claims
against Seattle Stevedore for alleged bad
faith violations of the LHWCA. In affirming
the Gistrict court's finding of no
jurisdiction under 28 U.S.C. Section 1333,
the Nintn Circuit Court of Appeals stated:

That Congress created statutory

obligations under the LHWCA,

pursuant to its maritime powers,

does not mean that admiralty

jurisdiction automatically

attaches where a claim is made
under the statute.

These longshoremen believe that the
Court of Appeals is wrong. Admiralty
jurisdiction has always attached to actions
brought to remedy violations of maritime

law.

"Every maritime nation has certain

rules or laws in relation to
ships, shipping, and meritime
matters - rules peculiar to
itself . : : : The admiraity

18

court was the forum through which
and by the aid of wnose process,
when necessary, these local
municipal and administrative laws
were enforced and their violators
condemned in civil damages or
criminally ... . Cases arising
under these laws are cases of
traditional admiralty jurisdic-

tion." 1 Benedict on Admiralty,
Section 102, pp. 7-4 to 7-5
(1985).

In Romero v. International Term. Co.,

358 U.S. 354 (1959), this Court faced the
issue of whether a foreign seaman could
obtain a jury trial by bringing a ciaim
arising pursuant to the maritime common law
under the District Court's general federal
question jurisdiction. After analyzing the
purposes of the jurisdictional grants
enunciated in 28 U.S.C. Section 1333, and

the predecessor of 28 U.S.C. Section 1331,

this Court concluded that the two
jurisdictional grants were mutually
exciusive; i.e., that general federal

question jurisdiction did not provide lower

19

courts with an alternative jurisdictional
basis to decide legal issues which had
previously been resolved pursuant to 28
U.S.C. Section 1333. Although the practical
issue in that case was a plaintiff's right
to a jury trial, the court's lengthy
discussion of the purposes underlying both
jurisdictional statutes makes clear that it
intended to preserve the distinction between
admiralty and general federal question
jurisdiction so as to ensure that federal
district courts sitting in admiralty would
continue to "enforce the comprehensive
federal interest in the law of the _ sea."
Id. at 363.

Prior to this Ninth Circuit decision,
it had always been generally assumed that
unless Congress legislated otherwise,
admiralty had jurisdiction over cases
involving the interpretation and violation

of maritime legislation. Id. at 371 ("in

20

the entire history of maritime legislation
Congress’ had not once let the
availability of trial on the law side to
inference"), and at 367, note 23 ("all
actions based on substantive federal
maritime law are cases arising under the
court's admiralty jurisdiction pursuant to

Art. 3, Section 2, cl. 1."). See, also, 1

Benedict on Admiralty Section 102, p. 7-5,

(1985). Cf. Giacona_v. Capricorn Shipping

Cs. 394 F.Supp. 1189, 1191 (1975)
(indicating that a claim based on o
violation of a maritime statute can be
brought under either Section 1333 or 1331.)
The only authority cited by the Ninth
Circuit for its bald assertion that
admiralty jurisdiction does not
automatically attach to a claim premised on
the violation of a maritime statute is its

own decision in Myhran v. Johns-Manville

Corp., 741 F.2d 1119 (9th Cir. 1984). That

21

case did not involve a maritime statute.
Moreover, in that case, the Ninth Circuit
specifically held that:
“resolution of Myhran's’= [common
law] tort claims does not require
the special expertise of a court
sitting in admiralty .. . nor is
there any federal interest in
uniformity of decision requiring
the application of federal
substantive law." Id. at 1122.
These observations are sufficient to
distinguish Myhran from the instant
situation. This court long ago held that
the creation and operation of a compensation
scheme for longshoremen was of such national
concern that the task of operating such a

system could not be delegated the states.

Washington v. W.C. Dawson Co., supra. And

in Crowell v. Benson, supra, at 49, this

Court indicated that resolution of legal
issues arising under that Act should be by a

federal court sitting in admiralty.

22

Apparently, the Ninth Circuit Was
reluctant to find admiralty jurisdiction
because it thought these longshoremen were
attempting to collect punitive damages,
which are sometimes allowed in admiralty.
Ce., @ 28 wee 21, O@- 328:; This was a
mistaken niin. But even if it were
correct, that would not be an appropriate
reason to withhold jurisdiction. The very
purpose for the constitutional grant of

admiralty jurisdiction is "to place _ the

entire subject, including its substantive as

well as its procedural features, under
national controi." Detroit Trust Co. v.
Steamer "THOMAS BARLUM", 293 U.S. 21, 43

i
The thrust of these longshoremen's

prayer to the district court was for
compensatory damages for injuries not
compensable under the LHWCA. Punitive

damages were sought so as to deter similar
conduct by other potential defendants in the
future.

23
(1934). The fact that admiralty may have
its own peculiar features, like punitive
damages, to ensure compliance with its

mandates is no reason to withhold admiralty
jurisdiction. For certainly the district
courts, sitting without a jury to "enforce
the comprehensive federal interest in the
law of the sea", Romero, 358 U.S., at 363,
will be able to discern the appropriateness

of applying this remedy.

II. THE NINTH CIRCUIT'S JUDGMENT THAT THE
EXCLUSIVITY AND PENALTY PROVISIONS OF
THE LHWCA BAR LONGSHOREMEN'S ACTIONS
FOR DAMAGES CAUSED BY A SELF-INSURER'S
BAD FAITH CONDUCT AFTER EMPLOYMENT HAS
ENDED CONFLICTS WITH THE 1ST CIRCUIT'S
DECISION IN MARTIN v. TRAVELERS INS.
cCO., 497 F.2D 329 (1ST CIR. 1974), AND
IS INCONSISTENT WITH THIS COURT'S
RECENT DECISIONS IN NORTHEAST MARINE
TERMINAL CO. v. CAPUTO, 432 U.S. 249
(1977), P.C. PFEIFFER CO. v. FORD, 444
U.S. 69 (1979), AND HERB'S WELDING INC.
v. GREY, 105 S.CT. 1421, U.S.
(1985).

The instant decision of the Ninth

Circuit conflicts with Martin v. Travelers

24

Ins. Co., 479 F.2d 329 (ist Cir. 1974).

Op., p. 21 and 22. In Martin, the 1st
Circuit held that the action of a
longshoreman seeking to recover damages for
injuries resulting from the bad faith
handling of his compensation claim was not
barred by the exclusivity, 33 U.S.C. Section
905(a), and penalty, 33 U.S.C. Section
914(e) and (f), provisions of .e LHWCA
because the Act did not apply to injuries
occasioned after employment had ended. This
reasoning is consistent with the general
rule that exclusivity provisions bar claims
for injuries covered by the compensation law
only. 2(a) Larson Workmen's Compensation
Law, Section 65.40, at 12-25 thru 12-32
(1985).

Recent decisions of this Court seem _ to
indicate that these longshoremen's injuries,
which stemmed from Seattle Stevedore's land

based actions occurring after maritime

25

employment had terminated, lack the
requisite, situs and status to be covered

under the LHWCA. Herb's Welding, Inc. v.

Gray, 105 S.Ct. 1421, 1427-1428 (1985);

Director, OWCP v. Perini North River

Associates, 459 U.S. 297 (1983); P.C.

Pfeiffer Co. v. Ford, 444 U.S. 69, 74

(1979); Northwest Marine Terminal Co. v.

Caputo, 432 U.S. 249, 265 and 279 (i977).
If this is so, the Ninth Circuit decision
leaves longshoremen without any real remedy
under the LHWCA or the maritime common law

for injuries occasioned as the result of an

insurer's bad faith handling of a
2
compensation claim. Although the Ninth
2
Apparently, the one exception

envisioned by the Ninth Circuit to
exclusivity would be when an employer
specifically intended to injure an employee.
Op. 20 and 21. It is respectfully contended
that this exception is too narrow under the

(Footnote Continued)

Circuit acknowledges that this appears

inconsistent with this Court's prior
beneficent treatment of longshoremen, see
Op. 18, it rationalizes such a result under

Justice Steven's Opinion in Mobile Oil Corp.

v. Higginbotham, 436 U.S. 618 (1978) by

concluding that Congress enacted the Act's
penalty, 33 U.S.C. Section 914(e) and (f),
and attorney fees, 33 U.S.C. Section 928(a),
provisions precisely for use against
defendants like Seattle ‘Stevedore, who act

in bad faith. Op. 18 and 19. This is a

(Footnote Continued)

LHWCA because in many instances it would
leave longshoremen who have been injured by
an insurer's bad faith without a remedy
under the Act because of its situs and
status requirements. The real test should
be whether the insurer's conduct causing
injury was so egregious that it could not
meet the "naturally resulting" test of
section 902(2)'s definition of injury. "The
term ‘injury' means accidental injury . . ;
and such occupational disease or infection
as... -. naturally or unavoidably results
from such injury." Id.

27

clear misreading of both the LHWCA

provisions and Higginbotham. These LHWCA

provisions apply to any employer who
withholds payments, whether the withholding
is in good faith or bad faith, and provide
interest benefits to all claimants whether
or not the withholding results in injury.
Certainly, these provisions alone are not an
indication thet Congress intended
longshoremen to have no remedy for
substantial injuries caused by an insurance
company's bad faith refusal to comply with
the law. See, e.g., Stafford v. Westchester

3
Fire Ins. Co., 526 P.2d 37 (i974).

3

In Stafford, the Alaska Supreme Court
interpreted an identical penalty provision
taken by the Alaska legislature from the
LHWCA. In response to the argument that
these penalty provisions were supposed to be

the exclusive remedy for an insurer's
tortious behavior in the handling of
compensation claims, the Court stated: "We

(Footnote Continued)

28

As it stands now in the Ninth Circuit,
unless the situs and status requirements of
the Act are exempted in cases like these,
longshoremen will be unable to secure any
remedy for injuries, no matter how
substantial, occasioned as the result of an
insurer's bad faith refusal to provide
nedical benefits or pay compensation. This
insulation from liability (no matter how
egregious the bad faith) coupled with the
systemic delays in the LHWCA adjudication
process will allow insurers an unregulated
life or death power over longshoremen, who

when within admiralty's reach have been the

(Footnote Continued)

believe that AS 23.30.155 was envisioned by
Alaska's legislature to cover situations
where the employer negligently, or
willfully, failed to make timely
compensation payments, but that this section
was not intended to operate as the exclusive
remedy for all intentional wrongdoings.
See, aiso, Martin v. Travelers Ins. Co.,

supra.

29

traditional wards of this Court. See, e.g.,

American Export Lines, Inc. v. Alvez, 446

U.S. 274, 284-285 (1980); Moragne v. States

Marine Lines, 398 U.S. 375, 387 (1970); Seas

Shipping Co. v. Sieracki, 338 8.8. G88.

180-182 (1946).

CONCLUSION
For the reasons set forth above, the
Petition for a Writ of Certiorari should be
granted.
Respectfully submitted,

STAFNE & WETZEL

By: Scott E. Stafne
1111 Smith Tower
Seattle, WA 98104

December 23, 1985

ei.

UNITED STATES COURT OF APPEA ,
FOR THE NINTH CIRGER@=2,| M MAIL|

Witciam Sampce and Karen NOV 12 1985
Samp ce, husband and wife, and Al SEATIE
JaMES SHELTON, CLERK U.S. ph.
Plaintiffs-Appeilants/ Sines & Sait “ ~~ DEPUTY
Cross-Appellees, 84. 4240 ;
" D.C. No.
REGINALD JOHNSON, Deputy CV 83-1060R
Commissioner for the Office of ;
Worker Compensation Program for OPINION
District 14, et al.,
Defendants-Appellees/
Cross-Appellants.
Argued and Submitted

August 8, 1985—Seattle, Washington
Filed September 20, 1985

Before: Harry Pregerson and Charles Wiggins, Circuit Judges.
and Robert H. Schnacke,* District Judge.

Opinion by Judge Wiggins
Appeal from the United Staies District Court

for the Western District of Washington
Barbara Rothstein, District Judge, Presiding

*Hon. Robert #. Schnacke, United States District Court for the Northern
District of California. sitting by designation.

SAMPLE, ET AL. V. JOHNSON, ET AL. A-2

‘SUMMARY

Admiraity /Labor

Appeal by two longshoremen of a district court judgment that
the government may take up to six months to conduct Longshore-
men’s and Harbor Workers’ Compensation Act (LHWCA), 33
U.S.C. § 901 et seg., claim hearings and that the government is
not compelled to reject an LHWCA claim or make an award
within 20 days after notice of no hearing is he!d, and that there
is no admiralty jurisdiction for intentionally wrongful controver-
sions of LH WCA claims; and cross-appeal by government of dis-
trict court’s refusal to dismiss the claims against the government
as moot. Affirmed in part and reversed in part.

Both plaintiffs were injured in 1982; plaintiff Sample on April
26 and plaintiff Shelton on March 28. Sample received compen-
sation from his employer from April 8 to June 1, 1983. His claim
was controverted June 15, 1983 and a hearing was held before an
administrative law judge (ALJ) March 14, 1984. He received an
award of LHWCA compensation April 23, 1984, but was with-
out income for more than ten months. Shelton received compen-
sation from the employer from April 27, 1982, but requested a
hearing concerning the level of compensation January 28, 1983.
The employer controverted the claim and stopped payment on
May 20, 1983. A hearing was held on October 27, 1983 and he
was awarded permanent partial disability February 15, 1984,
with nine months having elapsed between controversion and
award during which he was without income. The district court
denied the government’s request for dismissal of the action as
moot on the basis that the plaintiffs are receiving award pay-
ments, ruled that the government has up to six months after con-
troversion to award benefits, that the ALJ must rule on a
LHWCA within 20 days of a hearing, but that the Deputy Com-
missioner of Labor need not reject a claim or make an award
within 20 days of employer notice in cases where no hearing is
held.

[1] An exception to the general rule that a court’s decision will
not apply without a case or controversy exists where an injury is

SAMPLE, ET AL. V. JOHNSON, ET AL. A=-3

“capable of repetition, yet evading review,” [2] but the practices
to which appellants object must be capable of repetition as to
them. Where no class action is instituted, the capable of repeti-
tion doctrine is applied only in exceptional situations where the
plaintiff can reasonably show that he will again be subject to the
same injury. [3] The likelihood of the injury recurring must be
calculable and if there is no basis for predicting that any future
repetition would affect the present plaintiffs, there is no case or
controversy.

[4] Plaintiffs must show a likelihood that they will be affected
again by that which they challenge [5] and this burden cannot be
met by a merely subjective showing. [6] Here, the district court
simply noted that one of the plaintiffs, Sample, had returned to
work in a hazardous occupation, and that level of generality is
insufficient to establish that serious injury will probably recur to
Sample, so the court should have dismissed the claims against the
government as root.

[7] The district court’s conclusion that admiralty jurisdiction
was lacking because the intentional violations did not occur over
water and were unconnected with traditional maritime activities
is reviewed de novo and upheld. [8] The intentional harm claim
here involves little more than the state law tort of intentional
infliction of emotional distress and is not an admiralty claim at
all.

{9} The LHWCA’s exclusivity of remedies provision provides
that the liability of an employer shall be exclusive and in place of
all other liability of such employer. [10] Even if this provision is
not read to bar the putative cause of action for wrongful refusal
to pay sought by the plaintiffs, the LHWCA penalty provision
should serve the same purpose. If the penalty provisions are inad-
equate to fully compensate a worker who has been harmed by an
employer’s refusal to pay when due, the problem requires a politi-
cal solution.

SAMPLE, ET AL. V. JOHNSON, ET AL. A-4

COUNSEL

Scott E. Stafne and Stewart Jay, Seattle, Washington, for the
plaintiffs-appellants.

Richard K. Willard, Assistant Attorney General, Gene S. Ander-
son, United States Attorney, John F. Cordes and Mark W. Pen-
nak, Department of Justice, Washington, D.C. for the
defendants-appellees; Williams, Lanza, Kastner & Gibbs and
Richard M. Slagle, Seattle, Washington, for Seattle Stevedore
Co., etc.

OPINION
WIGGINS, Circuit Judge:

William Sample and James Shelton are longshoremen who
seek to overturn the judgment of the district court that the gov-
ernment may take up to six months to conduct Longshoremen’s
and Harbor Workers’ Compensation Act (LHWCA)! claim
hearings and that § 919(c)* does not compel the government to
reject an LHCWA claim or make an award within 20 days after
notice if no hearing is held. They also seek a reversal of the judg-

133 U.S.C. § 901, ef seq.
That provision reads:

The deputy commissioner shall make or cause to be made such
investigations as he considers necessary in respect of the claim, and
upon application of any interested party shall order a hearing thereon.
If a hearing on such claim is ordered the deputy commissioner shall
give the claimant and other interested parties at least ten days’ notice
of such hearing, served personally upon the claimant and other inter-
ested parties or sent to such claimant and other interested parties by
registered mail or by certified mail. and shall within twenty days after
such hearing is had, by order, reject the claim or make ar-award in
respect of the claim. If no hearing is ordered within twenty days after
notice is given as provided in subdivision (b) of this section, the'deputy
commissioner shall, by order, reject the claim or make an award in
respect of the claim.

SAMPLE, ET AL. V. JOHNSON, ET AL. A- 5

ment below ruling that there is no admiralty jurisdiction for their
claims against their employer and other “private” defendants and
no general maritime law remedy for intentionally wrongful con-
troversions of LHWCA claims. The government argues that
since Sample and Shelton have been compensated, their claims
are moot. We conclude that the district court erred in refusing to
dismiss the claims against the government as moot but we affirm
the dismissal of the claims against the employer.

FACTS

The facts are not disputed. Sample was injured on April 26,
1982: Shelton was injured on March 28, 1982. Sample received
compensation from Seattle Stevedore from April 8 to June 1,
1983. The employer controverted his claim on June 15, 1983 and
a hearing was held before an ALJ on March 14, 1984. On April
23, 1984, Sample received an award of LHWCA compensation
pussuant to an order of the district court. Sample was without
income during the more than ten months between the controver-
sion and the award.

Shelton received compensation from the employer from April
27, 1982, but requested a hearing concerning the level of com-
pensation on January 28, 1983. The employer controverted the
claim and stopped payment on May 20, 1983. A hearing was held
on October 27, 1983 and Shelton was awarded permanent partial
disability on February 15, 1984. Almost nine months elapsed
between controversion and award during which Shelton was
without income.

In its first order, dated April 6, 1984, the district court granted
summary judgment for Sample as to his claim that an ALJ must
rule on a LHWCA claim within twenty days of a hearing (ER
32). In its second order, dated July 27, 1984, the district court
denied the government's request for dismissal of the action as
moot. It ruled that benefits must be awarded to a claimant, if at
all, within six months of controversion. The trial court also held
that since the third sentence of section 919(c) is directory and not
mandatory, the Deputy Commissioner of Labor need not reject

SAMPLE, ET AL. V. JOHNSON, ET AL. A~G_

the claim or make an award within twenty days of employer
notice of the claim in cases where no hearing is held. In its third
order, dated August 13, 1984, the court granted the private
defendants’ motion to dismiss all claims against them because the
claims were not cognizable in admiralty, there is no private cause
of action for violations of the LHWCA and the claims were
barred by 33 U.S.C. § 905(a), the LHWCA exclusivity of reme-
dies provision.*

MOOTNESS

A moot action is one where the issues are no longer live or the
parties lack a legally cognizable interest in the outcome. Lee v.
Schmidt-Wenzel and Harter, No. 84-5945, slip op. at 5 (9th Cir.
July 26, 1985). Federal courts lack jurisdiction to decide moot
cases because their constitutional authority extends only to
actual cases or controversies. Jron Arrow Honor Society v. Heck-
ler, 104 S.Ct. 373, 376 (1983). We apply a de novo standard for
reviewing a district court’s decision on subject matter jurisdic-
tion, see Fort Vancouver Plywood Co. v. United States, 747 F.2d
547, 549 (9th Cir. 1984) and, concomitantly apply that standard
in reviewing questions of mootness.

Since hearings have been held for and awards made to Sample
and Shelton, their declaratory and injunctive claims subsist only
if this case involves claims that are capable of repetition with
respect to those individuals. The government contends that
because appellants have not shown that it is likely they will again
be injured and make claims, the case against it is moot. Appel-
lants retort that since the district court found that Sample had
resumed working in the hazardous occupation of longshoreman,
they continue to present viable claims against the government.

*Section 905(a) states in pertinent part that

The liability of an employer prescribed in section 904 of this iitle
shall be exclusive and in place of all other liability of such employer to
the employee [except] if an employer fails to secure payment of com-
pensation as required by this chapter, an injured employee ... may
elect to claim compensation under the chapter, or to maintain an
action at law or in admiralty for damages on account of such injury or
death.

SAMPLE, ET AL. V. JOHNSON, ET AL. A-~7

{1] The Supreme Court early-on fashioned an exception to the
general rule that where a court’s decision will no longer have an
impact on plaintiff, there is no case or controversy. In Southern
Pacific Terminal Company v. Inierstate Commerce Commis-
sion, 219 U.S. 498 (1911), the Court permitted review of an
administrative order that prohibited for two years the continuing
of a private agreement, even though the two years had expired.
The Court recognized that questions involved in ICC proceedings
are frequently repetitive, but that the agency’s order are often of
short duration. Review could be had where there was injury that
was “capable of repetition, yet evading review.” Jd. at 515.‘

The questions presented by appellants’ claims against the gov-
ernment evade review. They concern twenty-day and six-month
time-limits. There could never be a full adjudication that would
inure to the benefit of a longshoreman who brought a similar
challenge. In Board of Education of Hendrick Hudson Central
School District v. Rowley, 458 U.S. 176, 186 n.9 (1982), where
it was claimed that an individualized educational program (IEP)
for a handicapped child for the school year 1978-79 was inade-
quate, the Supreme Court noted that “Judicial review invariably
takes more than nine months to complete, not to mention the
time consumed during preceding state administrative hearings.”
It held that the IEP’s shortcomings were capable of repetition as
to the parties before it, yet evaded review. See also California
Energy Resources Conservaiion and Development Commission
v. Bonneville Power Administration, 754 F.2d 1470, 1473 (9th
Cir. 1985) (“short-term transactions . .. can evade review in the
sense that they can be completed in a shorter time than that
required by the parties and this court to file, brief, argue, and
decide a case”).

“The oft-cited doctrinal formula is found in Weinstein v. Bradford, 423 U.S.
147, 149 (1975) (per curiam), where it was held that an injury is capable of rep-
etition, yet evades review if: (1) the challenged action was of limited duration,
too short to be fully litigated prior to its cessation or expiration; and (2) there
is a reasonable expectation that the same complaining party will be subjected to
the same action again. This formulation is of relevance only in the absence of a
class-action suit. See Planned Parent. of C. & N. Ariz. v. State of Ariz., 718
F.2d 938, 949 (9th Cir. 1983). Neither this case nor those discussed below
involved class action.

SAMPLE, ET AL. V. JOHNSON, ET AL. A-§

[2] The question then is whether the practices to which appel-
lants object are capable of repetition as to them. Where no class
action has been instituted, the capable of repetition doctrine is
applied only in exceptional situations where the plaintiff can rea-
sonably show that he will again be subject to the same injury. See
City of Los Angeles v. Lyons, 461 U.S. 95, 108 (1983) (unlikely
that plaintiff will again be subject to police chokehold). That
other persons may litigate a similar claim does not save a case
from mootness. Lane v. Williams, 455 U.S. 624, 634 (1982)
(question whether defendant must be informed that guilty plea
yields mandatory parole term is moot where sentence already
served; petitioner now knows consequences of plea).

This rule is but a reflection of the Article III requirements of
direct injury and a “personal stake” in the outcome. See Warth
v. Seldin, 422 U.S. 490, 498 (1975); 13A C. Wright, A. Miller
& E. Cooper, Federal Practice & Procedure § 3531.12 at 60
(1984). Cases construing the “capable of repetition” : ule are thus
similar to standing cases. See United States Parole Commission
v. Geraghty, 455 U.S. 388, 397 (1980) (“The requisite personal
interest that must exist at the commencement of the litigation
(standing) must continue throughout its existence (mootness)”).*

There has been scant analysis of what must be shown to estab-
lish that a plaintiff will likely be injured again. The Supreme
Court has stated that plaintiffs must demonstrate that a “credible
threat” exists that they will again be subject to the specific injury
for which they seek injunctive or declaratory relief. Kolender v.
Lawson, 461 U.S. 352, 355 n.3 (1983). A “reasonable showing”
of a “sufficient likelihood” that plaintiff will be injured again is
necessary. City of Los Angeles v. Lyons, 461 U.S. at 108, 111.

*Examples include Rizzo v. Goode, 423 U.S. 362 (1976) (no mor. than hypo-
thetical possibility that plaintiffs’ individual rights would be violated by uncon-
stitutional police action in future) and O'Shea v. Littleton, 414 U.S. 488 (1974)
(discriminatory bail, sentencing and costs practices challenged: no standing
because possibility that plaintiffs would later violate law too remote). These
cases require that a plaintiff establish his “personal stake” in injunctive relief by
making “an essential showing of the likelihood of similar injury in the future.”
LaDuke v. Neison, 762 F.2d 1318, 1324 (9th Cir. 1985).

SAMPLE, ET AL. V. JOHNSON, ET AL. A-9

The “mere physical or theoretical possibility” of a challenged
action again affecting a plaintiff is not sufficient. Murphy v.
Hunt, 455 U.S. 478, 482 (1982) (not probable that conviction of
one who attacked state's denial of bail for accused sex offenders
will be overturned and he will again seek pre-trial bail). There
must be a “demonstrated probability” that plaintiff will again be
among those injured. Weinstein v. Bradford, 423 U.S. at 149 (not
shown that former prisoner probably would be among those
deprived of parole procedures that he had sought).

{3] The likelihood of the injury recurring must be calculable
and if there is no basis for predicting that any future repetition
would affect the present piaintiffs, there is no case or controversy.
Preiser v. Newkirk, 422 U.S. 395, 402-403 (1975) (prisoner’s
challenge to transfer from medium to maximum security prison
moot because of re-transfer to medium security; any fear of
returning to maximum security “remote and speculative”);
Wiggins v. Rushen, 760 F.2d 1009, 1011 (9th Cir. 1985) (possi-
bility of being sent to maximum security unit “too speculative to
rise to the level of reasonable expectation or demonstrated
probability”); SEC v. Medical Committee for Human Rights,
404 U.S. 403, 406 (1972) (whether shareholders will again sub-
mit proposed corporate charter amendment to ban making of
napalm too speculative to prevent mootness).

In some cases, it is virtually certain that the plaintiff would
never again be affected by the practice that he challenged. See,
for example, DeFunis v. Odegaard, 416 U.S. 312, 318-319

_ (1974) (certain that plaintiff, who challenged admission policies
of law school to which he was ordered admitted and from which
he graduated, would never go through law school again); Hall v.
Beals, 396 U.S. 45, 49 (1969) (almost no chance that franchise
residency statute that affected plaintiffs in 1968 election would
also affect them in 1972); Trustees for Alaska v. E.P.A., 749
F.2d 549, 556 (9th Cir. 1984) (intervening change in legal! stan-
dard moots claim of those challenging expired pollution dis-
charge permits); Wilson v. State of Nev., 666 F.2d 378, 381 (9th
Cir. 1982) (disparate impact challenge to state high school
diploma job requirement mooted by plaintiff's earning diploma);

SAMPLE, ET AL. V. JOHNSON, ET AL. A-/O

Clancey v. Albert, 600 F.2d 237, 238 (9th Cir. 1979) (possibility
too remote that constituent challenging bar against convicted
and defeated Congressman voting until vindicated or reclected
would again live in district with a criminal Congressman), cert.
denied, 444 U.S. 916 (1979); Friends of the Earth, Inc: v. Berg-
land, 576 F.2d 1377, 1379 (9th Cir. 1978) (defendant will not
repeat exploration which plaintiffs sought to enjoin); Chrisman
v. Sisters of St. Joseph of Peace, 506 F.2d 308 (9th Cir. 1974)
(woman who sought hospital sterilization sterilized elsewhere).

Other cases evince a strong probability that plaintiff might be
affected more than once by the questioned practice. See,
Kolender v. Lawson, 461 U.S. at 355 n.3 (plaintiff stopped 15
times in two years pursuant to ordinance requiring identification
by those who wander the streets); Globe Newspaper Co. v. Supe-
rior Court, 457 U.S. 596, 603 (1982) (assume major newspaper
opposing statute banning press from trials involving sex offenses
will again be subject to statute’s strictures); Gannet Co. v.
DePasquale, 443 U.S. 368, 377-78 (1979) (expect major news-
paper publishing company will again be affected by judicial
refusal to open trial to press or provide transcript); Securities and
Exchange Commission v. Sloan, 436 U.S. 103, 109 n.5 (1978)
(action against suspension of trading of stock not moot although
no current suspension because SEC considers company chronic
violator); First National Bank of Boston v. Belloti, 435 U.S. 765,
775 (1978) (challenge to statute prohibiting expenditures by
banks for referenda not moot, despite particular referendum’s
defeat, since it had been on the ballot four times before); United
States v. New York Telephone Co., 434 U.S. 159, 165 n.6 (1977)
(plain that telephone company will be subject to government
orders to install pen registers in future); Nebraska Press Ass'n.
v. Stuart, 427 U.S. 539, 547 (1976) (order prohibiting entire
press from reporting on confessions during “sensational” trial);
In re Grand Jury Proceedings Klayman, 760 F.2d 1490, 1492
(9th Cir. 1985) (government will again call attorney to testify
before new grand jury; attorney will again refuse to answer ques-
tion); United States v. State of Or., 657 F.2d 1009, 1012 (9th
Cir. 1981) (salmon fishing season over but Indians will want to
fish next year and similiar injunction will issue): Thirteenth

SAMPLE, ET AL. V. JOHNSON, ET AL. Anll

Guam Legislature v. Bordallo, 588 F.2d 265, 266 (9th Cir. 1978)
(per curiam) (legislative session over but governor intends to use
item veto in future sessions).

Many cases fall in between these two poles. In some instances,
the action for declaratory or injunctive relief remained viable.
See Carroll v. President & Commissioners of Princess Anne, 393
U.S. 175, 179 (1968) ‘racists whose speeches restricted by
county ordinance may again seek permit for rally); Johansen v.
San Diego County District Council, 745 F.2d 1289, 1293 (9th
Cir. 1984) (unions and contractors will continue to have labor
disputes and NLRB will likely continue to request short-term
picketing injunctions); N.A.A.C.P. Western Region v. City of
Richmond, 743 F.2d 1346, 1353 (9th Cir. 1984) (Richmond
police had killed five black men in three years, NAACP has inter-
est in protest and no reason to believe that Richmond will refrain
from enforcing the parade ordinance in the future); Tyars v. Fin-
ner, 709 F.2d 1274, 1280 (9th Cir. 1983) (“definite likelihood”
that plaintiff would again be involuntarily coiimitted under chal-
lenged procedures because he was committed twice since first
raising challenge); Doe v. Gallinot, 657 F.2d 1017, 1021 n.6 (9th
Cir. 1981) (same; confined six times after complained-of com-
mitment).

In other instances, there was “very little chance, much less a
reasonable expectation” that a plaintiff would again be subjected
to the act of which he complains. Luckie v. E.P.A., 752 F.2d 454,
458 (9th Cir. 1985) (for recurrence, residents would have to relo-
cate atop another asbestos dump and again be subject to EPA
regulatory scheme). See also Lee v. Schmidt-Wenzel and
Harter, slip op. at 7 (because vacancies on board of directors of
bank now filled, “extremely unlikely” that dispute over whether
vacancies must be filled by a majority of full board or could be
filled by majority of quorum present at meeting would arise
again); Walker v. Huston, 689 F.2d 901, 903 (9th Cir. 1982) (re-
lease moots challenge to statute making rape offense nonbailable
on appeal; no reasonable expectation that petitioner would again
be convicted of rape and denied bail); California Hospital Ass'n
v. Obledo, 602 F.2d 1357, 1359 n.2 (9th Cir. 1979) (unlikely that

SAMPLE, ET AL. V. JOHNSON, ET AL. A-/2

state will issue another order freezing interim hospital reim-
bursement payments); United States v. State of Washington,
Department of Fisheries, 573 F.2d 1118, 1120 (9th Cir. 1978)
(unlikely that now-rescinded regulations covering !ndian fishing
rights will be reissued; issuing agency no ionger has jurisdiction
over Indians); Williams v. Alioto, 549 F.2d 136, 144 (9th Cir.
1977) (since murders solved, no cognizable danger or reasonable
expectation that policy of detaining black males in connection
with “Zebra” killings would recur); Wilson v. Webster, 467 F.2d
1282, 1283 (9th Cir. 1972) (improbability of further campus
uprisings moots challenge to related ordinance); Halvonik v.
Reagan, 457 F.2d 311, 313-14 (9th Cir. 1972) (unlikelihood of
future riots moots challenge to California loitering and assembly
regulations).®

[4] There are a few generalizations that might be extracted
from the cases concerning capability of repetition. The principal
tendency to emerge is the necessity for plaintiffs to show a likeli-
hood that they will be affected again by that which they chal-
lenge. A decade ago, when there had as yet been little
development of the case law, commentators could argue with
some authority that judicial economy or the importance of the

"Several cases have simply ignored the necessity of determining whether there
will likely be a repetition of the injury in question. See, for example, Super Tire
Engineering Co. v. McCorkle, 416 U.S. 115, 125-26 (1974) (strike over but
action against strikers receiving welfare not moot because state policy is fixed;
no discussion of probability of another strike against plaintiff-empioyer); Roe v.
Wade, 410 U.S. 113, 125 (1973) (attack on abortion laws not moot despite
plaintiff no longer being pregnant and giving no indication that she will again
become pregnant and seek abortion); Dunn v. Blumstein, 405 U.S. 330, 333 n.2
(1972) (even though plaintiff now eligible to vote, challenge to durational resi-
dency requirement allowed because others still affected); Moore v. Ogilvie, 394
U.S. 814, 816 (1969) (election over but challenge to nominating petition proce-
dure will proceed because of “continuing controversy in the federal-state area”);
Allen v. Monger, 583 F.2d 438, 440 (9th Cir. 1978) (action by now-discharged
sailors who served aboard now moth-balled ship to enjoin regulation prohibiting
petitioning of Congressmen not moot because “serious questions raised”),
vacated, 444 U.S. 1063 (1980); Webster v. Mesa, 521 F.2d 442, 443 (9th Cir.
1975) (action against law prohibiting voter who has signed partisan candidate's
petition from also signing independent's petition for same office not moot despite
end of petitioning period).

EE Se ee oe eS

SAMPLE, ET AL. V. JOHNSON, ET AL. A-—13

question presented may outweigh the need for showing anything
more than the “mere possibility” that piaintiff had a continuing
personal stake in securing injunctive or declaratory relief. See D.
Kates, W. Barker, Mootness in Judicial Proceedings: Toward a
Coherent Theory, 62 Cal. L.Rev. 1385, 1418-1425 (1974); Note,
The Mootness Doctrine in the Supreme Court, 88 Harv. L.Rev.
373, 388 (1974). Cases such as City of Los Angeles v. Lyons, 461
U.S. 95 (1983), and LaDuke v. Nelson, 762 F.2d 1318 (9th Cir.
1985), make it clear that, no matter how important the issue or
how likely that a similar action will be brought, a court is without
jurisdiction if there is not a sufficient likelihood of recurrence
with respect to the party now before it.

[5] Another tendency that emerges is that of placing the burden
for showing a likelihood of recurrence firmly on the plaintiff. For
example, in United States v. W.T. Grant, 345 U.S. 629, 633
(1953), the Court held that an injunction case was not moot sim-
ply because the defendant had ceased the challenged practice
unless the defendant could show that there was “no reasonable
expectation” that the practice would be resumed. Thirty years
later, Lyons is replete with statements emphasizing that it is
plaintiff's burden to show the likelihood of recurrence. 461 U.S.
at 101-102 (“[t]he plaintiff must show that he ‘has sustained or
is immediately in danger of sustaining some direct injury’ as the
result of the challenged official conduct”; 461 U.S. at 109 (“the
named plaintiff [mast] make a reasonable showing that he will
again be subjected to the alleged illegality”). See also Lee v.
Schmidt-Wenzel and Harter, slip op. at 7 (“the plaintiffs have
the burden of showing that there is a reasonable expectation that
they will once again be subjected to the challenged activity”) (ci-
tation omitted). A plaintiff's burden can not be met with a merely
subjective showing. Jd. (“Speculative contingencies afford no
basis for finding the existence of a continuing controversy
between the litigants as required by article III”). An attestation
of plaintiff's fear that the injury might recur will not suffice to
demonstrate the capability of repetition of an injury. See Preiser
v. Newkirk, 422 U.S. at 402-403. Whether the standard is that
of a “credible threat”, a “reasonable showing” of a “sufficient
likelihood”, or a “demonstrated probability”, the “essential

SAMPLE, ET AL. V. JOHNSON, ET AL. A ~j4

showing” is objective, i.e. directly or inferentially statistical. See
D. Barnes, Statistics as Proof: fundamentals of quantitative
analysis 31-35 (1983) (statistical inferences). The subject matter
involved will facilitate precise prognostication in some cases and
hamper it in others, as the categorization of cases ‘illustrates.
However, there are many instances in which prediction, while not
simple, is quite possible. For example, in Johansen v. San Diego
County District Council, 745 F.2d 1289 (9th Cir. 1984), the
union presumably could have offered statistics on the frequency
of its engaging in secondary picketing, in order to show that it
was likely that it would again picket and the NLRB would again
seek a short-term injunction.

The instant matter is the paradigmatic case for a statistical
showing of likely recurrent injury. Here, the predicate to a claim
is a physical injury. There are few occurences that are more
assiduously recorded than physical injuries. Without such
records, of course, no actuarial table could be constructed and
insurance rates could not be fixed. There are many likely sources
for establishing the probability that a longshoreman will be seri-
ously injured, including insurance carriers, the Department of
Labor and both the employers and unions. With such statistics,
a prediction could be made as to whether one with the same
work-life expectancy as Sample is likely to experience another
claimable injury.

The cases have also not indicated what degree of probability is
required where a plaintiff can show a likely recurrence of injury.
Query whether the test should be one of more likely than not, i.e.
‘in instances reducible to percentages, more than fifty-fifty, or
whether the test should be one where probability, in the strict
sense, is not required, but merely some significant possibility. The
language found in the cases discussed above, particularly in
Weinstein (“demonstrated probability”), militates in favor of a
“more likely than not” standard.” However, because the concep-

’ The only federal court to define the term “probable” conceived of it as “more
than 50 percent of actual.” Price v. Nevland, 320 F.2d 674, 678 (D.C. Cir.
1963).

SAMPLE, ET AL. V. JOHNSON, ET AL. A-i5

tions of probability that have arisen in jurisprudence and in other
branches of learning have far from achieved a perfect congru-
ence, see D. Kaye, Statistical Significance and the Burden of
Persuasion, 46 Law & Contemp. Probs. 13 (1983), we prefer to
describe “probability” qualitatively, as requiring a very signifi-
cant possibility, and not quantitatively, as mandating a “greater
than fifty percent” likelihood. See M. Victor, Using Decision
Analysis to Assist Litigation Strategy, 40 Bus. Law. 617, 625-26
(1985) (qualitative v. quantitative descriptions of probability).

[6] The district court here simply noted that Sampie had
returned to work in a hazardous occupation. That level of gener-
ality is insufficient to establish that serious injury will probably
recur to Sample. Plaintiffs failed to meet their burden of demon
strating the probability of recurrence. Acco:dingly, the district .
court should have dismissed the claims against the government as
moot.

ADMIRALTY JURISDICTION

[7] Hoping to recover punitive damages, appellants alleged that
bad faith actions by the private defendants caused them injuries
apart from those covered by the LHWCA. They ciaimed that the
private defendants controverted their claims despite knowledge
that the workers were entitled to compensation. Defendants suc-
cessfully moved to dismiss pursuant to 28 U.S.C. 12(b)(6). The
district court held that admiralty jurisdiction, 28 U.S.C. § 1333,
was wanting because the intentional violations did not occur over
water and were unconnected with traditional maritime activities.
See Executive Jet Aviation, Inc. v. City of Cleveland, 409 U.S.
249, 253, 268 (1972). Questions of jurisdiction are reviewed de
novo. Fort Vancouver Plywood Co., 747 F.2d at 549.

Appellants admit that the failure to pay benefits prior to a
compensation hearing occurred on land and that the wrongful
controversion bore no relationship to a traditional maritime
activity. They nevertheless argue that the Executive Jet test is
inapplicable because it does not restrict admiralty jurisdiction
when the claim is founded upon a maritime statute, the

SAMPLE, ET AL. V. JOHNSON, ET AL. A-~/¢é

LHWCA, citing Director, Office of Workers’ Compensation
Programs v. Perini North River Associates, 459 U.S. 297
(1983).

Neither that case, nor others cited by appellants, involved the
use of admiralty jurisdiction coupled with an LHCWA claim.
Perini decided that a construction worker, injured while perform-
ing his craft for a construction company on a river barge used for
the construction of a sewage treatment plant, was engaged in
maritime employment and could, therefore, make an LHWCA
claim.* The other cases cited do not involve the LHWCA.

That Congress created statutory obligations under the
LHWCA, pursuant to its maritime powers, does not mean that
admiralty jurisdiction automatically attaches where a claim is
made under the statute. Myhran v. Johns-Manville Corp., 741
F.2d 1119, 1122 (9th Cir. 1984) is instructive in that regard.
There, a pipefitter was injured by asbestos while repairing and
renovating vessels on navigable waters. He filed a products liabil-
ity action against the manufacturers of asbestos products. Judge
Hug noted that the Supreme Court’s understanding of the his-
tory of admiralty jurisdiction

suggests that admiralty law is not concerned with tort
claims such as those of Myhran. None of the issues
listed by the Supreme Court in Executive Jet are
involved in Myhran’s suit. Rather, as the Eleventh Cir-
cuit observed in a case factually similar to this case, ‘the
issues that this litigation presents are identical to those
~: presented in countless other asbestos suits; they involve
questions of tort law traditionally committed to local

* Appellants also rely upon Crowell v. Benson. 285 U.S. 22 (1932), for the
notion that a court that treats an LHWCA claim is exercising its admiralty
jurisdiction. In that case, Chief Justice Hughes mentions that claims subject to
the LHWCA are “governed by the maritime law as established by the Congress
and are within the admiralty jurisdiction,” but only in the context of discussing
whether they implicated a right to trial by jury. /d. at 45. Nothing in that case
indicates that an injury giving rise to an LHWCA claim carries the general
admiralty law in its wake.

aS SST

SAMPLE, ET AL. V. JOHNSON, ET AL. A- 17

resolution. Harville v. Johns-Manville Products Corp.,
731 F.2d 775, 786 (11th Cir. 1984). Resolution of
Myhran’s tort claims does not require the special exper-
tise of a court in admiralty as to navigation or
water-based commerce, nor is there any federal interest
in uniformity of decision requiring the application of
federal substantive law (citation omitted).

[8] The district court was thus correct in viewing the inten-
tional harm claim as involving little more than the state iaw tort
of intentional infliction of emotional distress and not an admi-
ralty claim at all.

THE COMMON LAW AND STATUTORY
EXCLUSIVITY OF REMEDY

The district court, citing Cort v. Ash, 422 U.S. 66 (1975), held
that an injured longshoreman had no “private right of action” to
sue for damages in excess of those prescribed by the LHWCA
where the alleged damages were related to section 907 and 908
of the Act.® Appellants assert that in contrast to the claims dealt
with in Cort (a stockholder’s derivative suit against officials who
had violated federal election laws by expending their corpora-
tion’s funds for advertising in the 1973 Presidential elections),
they have sued the private defendants under a body of federal
common law where federal courts are permitted to create reme-
dies, i.e. maritime law.

The private defendants answer that there is no federal common
law. This is, of course, inaccurate. There may be “no federal gen-
eral common law.” Erie R. Co. v. Tompkins, 304 U.S. 64, 78
(1938), but federal common law exists where a federal rule of
decision is “necessary to protect uniquely federal interests”,
Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398, 426 (1964)
or where Congress has given the courts power to develop substan-

*The former provision covers the employer's responsibility for furnishing the
injured worker with medical services and supplies, while the latter provision cov-
ers compensation for disability.

SAMPLE, ET AL. V. JOHNSON, ET AL. A-/2

tive law. Wheeldin v. Wheeler, 373 U.S. 647, 651 (1963). See
also Note, The Federal Common Law, 82 Harv. L. Rev. 1512
(1969). The general maritime law is probably the most ancient
body of federai common law. See Edmonds v. Compagnie Gener-
ale Transatlantique., 443 U.S. 256, 259 (1978). It has been spe-
cifically held that general federal maritime law is a source of
relief for a longshoreman’s personal injury. Pope & Talbot, Inc.
v. Hawn, 346 U.S. 406, 412-414 (1953).

Supreme Court cases provide several examples of the creation
of remedies under general maritime law for nonpecuniary dam-
ages that supplement federal maritime statutory remedies. In
Moragne v. States Marine Lines, Inc., 398 U.S. 375 (1970), a
longshoreman’s widow sued for the wrongful death of her hus-
band. She joined claims of negligence and unseaworthiness under
the general maritime law. The Court held that a common law
cause of action for wrongful death lies, even though federal stat-
utes have sought to create a uniform remedy for negligent-
ly-caused deaths, because additional, nonstatutory federal
remedies would create uniformity by substituting for the
patch-work of state wrongful death laws. 398 U.S. at 400-401. In
Sea-Land Services, Inc. v. Gaudet, 414 U.S. 573, 583 (1974), the
Court, in allowing for suit by the widow of a longshoreman who
had recovered damages for his injuries prior to work-related
death, stated that Moragne created a wrongful-death remedy
independent of any action that the decedent during his lifetime
may have had for his own personal injuries. Finally, in American
Export Lines, Inc. v. Alvez, 446 U.S. 274, 283 (1980), the Court
held that the wife of a harbor worker injured aboard a ship on
state territorial waters could maintain a general maritime action
for damages for the loss of her husband’s society.

.. While all of these cases implicated longshoremen or harbor
workers, none of these cases involved an action under the
LHWCA. Moreover, other cases have not shown a similar readi-
ness to create general maritime nonpecuniary damage remedies.
In Mobil Oil Corp. v. Higginbotham, 436 U.S. 618 (1978), the
Court construed the Death on the High Seas Act (DOHSA), 46
U.S.C. § 762, as forbidding general maritime law supplementa-

SAMPLE, ET AL. V. JOHNSON, ET AL. A-19

tion of the elements of compensation provided for by that Act.
DOHSA expressly limits a decedent’s survivors’ recovery to their
“pecuniary loss’ and hence additional damages for nonpecuniary
losses could not be had. Distinguishing Moragne and Gaudet,
Justice Stevens stated that “There is a basic difference between
filling a gap left by Congress’ silence and rewriting rules that
Congress has affirmatively and specifically enacted.” Jd. at 625;
see also Beltia v. Sidney Torres Marine Transport, Inc., 701
F.2d 491 (Sth Cir. 1983) (suits for loss of society based upon neg-
ligence not maintainable because Jones Act does not permit sup-
plemental recovery for that injury, but such recovery possible
where general maritime claim for unseaworthiness is also
brought).

While Congress did not expressly preclude the creation of a
common law remedy for wrongful contravention, the remedies
that it has made available for use against employers who act in
bad faith bear on the question of whether federal courts ought to
create the general maritime law remedy sought here. As the
Court noted in Moragne, 398 U.S. at 407, the LHWCA’s

principles of recovery are wholly foreign to those of gen-
eral maritime law—like most workmen’s compensation
laws, it deals only with the responsibilities of employers
for death or injury to their employees, and provides
standardized amounts of compensation regardless of
fault on the part of the employer.”

{9] The LHWCA’s exclusivity of remedies provision, 33 U.S.C.
§ 905(a), states that “ “he liability of an employer prescribed in
[this title] shall be exclusive and in place of all other liability of
such employer.” LHWCA liability occurs for “accidental injury
or death arising out of and in the course of employment.” 33
U.S.C. § 902(2). Thus, the employer is not liable under the

2° Moragne was, of course. handed down before the 1972 amendments to the
LHWCA. However, these amendments were chiefly for the purpose of
strengthening the exclusivity of LHWCA remedies. See Northeast Marine Ter-
minal Co. v. Caputo, 432 U.S. 249, 261-262 (1977); S.Rep. No. 1125, 92d
Cong.. 2d Sess. 4 (1972). .

|

SAMPLE, ET AL. V. JOHNSON, ET AL. A-~29

LHWCA for intentional injuries that it causes and section
905(a) is not applicable to claims concerning such injuries. How-
ever, the term “intentional” is construed very strictly where a
workers’ compensation statute exists. As Professor Larson, 2A
Larson Workmen's Compensation Law § 68.13 at 13-8—13-9
(1984), explains

Since the legal justification for the common-iaw
action is the nonaccidental character of the injury from
the defendant employer’s standpoint, the common-law
liability of the empioyer cannot, under the almost unan-
imous rule, be stretched to include accidenta! injuries
caused by the gross, wanton, willful, deliberate, inten-
tional, reckless, culpable, or malicious negligence,
breach of statute, or other misconduct of the employer
short of genuine intentional injury.

A number of district courts have applied this principle in
LHWCA cases. See Houston v. Bechtel Assoc. Professional
Corp., 522 F.Supp. 1094, 1096 (D.D.C. 1981) (“Nothing short
of specific intent to injure the employee falls outside the scope of
§ 905(a). Absent such specific intent, the employee is foreclosed
from maintaining a tort action against his employer”) and cases
cited therein." The employee must, of course claim that the
employer deliberately intended to injure him. Austin v.
Johns-Manville Sales Corp., 508 F.Supp. 313, 317 (D.Me.
1981). The courts have adhered to this rule because they recog-
nize, as did congress when amending the LHWCA in 1972, that
the LHWCA “operates like ordinary workmen’s compensation
and operates on a percentage of the earnings of an individual
rather than reimbursing him for his actual injury, and puts a lid
on his recovery.” 118 Cong. Rec. 36383 (1972) (remarks of Rep.
Eckhardt). However, the courts also recognize that without such

12.4 mong these cases is an LHWCA matter in which Judge Orrick noted that
“Under workers’ compensation statutes, the cxclusive liability protection
afforded to the employer cannot be pierced if the employee's injury is caused by
the employer’ $s negligence, or any other misconduct short of genuine intentional
injury.” Baker v. Pacific Far Easi Lines, Inc., 451 F.Supp. 84, 95 (N.D. Cai.
1978) (footnotes omitted).

peer

SAMPLE, ET AL. V. JOHNSON, ET AL. A- 2i

a rule, punitive damages might be awarded for insufficiently
egregious acts. See Houston, 522 F.Supp. at 1097 (for punitive
damages, tort must be aggravated by evil motive, actual malice,
deliberate violence or oppression). Here, the complaint does not
allege that plaintiffs suffered severe emotional! distress or that it

was inflicted intentionally, let alone with actual malice. See ER
5-7.

Professor Larson has considered the attempts in worker’s com-
pensation cases to create a cause of action for intentional injury
by an employer who has delayed or terminated payment or treat-
ment. See 2A Larson Workmen's Compensation Law § 68.34(c)
(1984). He has concluded that

The temptation to shatter the exclusiveness principle by
reaching for the tort weapon whenever there is a delay
in payments or a termination of treatment is all too
obvious, and awareness of this possibility has undoubt-
edly been one reason for the reluctance of courts to rec-
ognize this tort except in cases of egregious cruelty or
venality.

Id. at 13-76.

One such case, in which the employer’s conduct was
“conspicuously contemptible” was Martin v. Travelers ins. Co.,
497 F.2d 329 (ist Cir. 1974). Plaintiff had received LHWCA
compensation in the form of three drafts, which he deposited and
drew upon. The defendant insurance company, deciding to
appeal, stopped payments on the draft, causing plaintiff financial
hardship and emotional distress. Reversing the district court’s
dismissal, Judge Coffin, in an opinion free of citation to author-
ity, concluded that where a carrier deliberately stops payments

12Punitive damages are awardable, in some circumstances, to a seaman where
payment for maintenance and cure is wrongfully denied. See Tullos v. Resource
Drilling, Inc., 7150 F.2d 380, 388 (Sth Cir. 1985). However, the very existence
of separate acts for seamen and longshoremen—the Jones Act and the
LHWCA, respectively—suggest that the two categories of workers are not to be
assimilated in all respects.

SAMPLE, ET AL. V. JOHNSON, ET AL. 4-22

already made, when it should have known that acute harm might
follow, the exclusivity provision and the fact that the LHWCA -
contains a penalty for late payment do not bar an action.

In any event, cases involving ordinary refusal to pay are contra.
The bulk of authority in cases involving ordinary refusals to pay
is contra. One reason is that most worker’s compensation stat-
utes, like the LHWCA,” have penalty provisions for wrongful
failure to pay. See Annot., 8 ALR 4th902, 904 (1984). In states
where no such penalty provision exists, there are often explicit
provisions stating that nonstatutory remedies are not barred
when there is a refusal to pay. See, for example, Hollman v. Lih-
erty Mut. Ins. Co., 712 F.2d 1259, 1261 (8th Cir. 1983) (South
Dakota).

[10] In this case, Shelton was awarded almost $6,300 in attor-
ney’s fees and prejudgment interest and received compensation
for the “mental health sequelae” that flowed from his physical
injury. Even if the exclusivity provision of the LHWCA is not
read to bar the putative cause of action for wrongful refusal to
pay, the penalty provision should serve the same purpose. While
it may be that the penalty provisions are inadequate to fully com-
pensate a worker who has been harmed by an employer’s refusal
to pay when due, the problem requires a political solution. Goetz
v. Aetna Cas. and Sur. Co., 710 F.2d 561, 564 (9th Cir. 1983).

CONCLUSION
The claims against the government are moot. The district

court correctly dismissed the claims against the private defen-
dants.

Sections 914(e) and (f) increase the amount of compensation due by ten or
twenty percent for overdue installment payments payable without or with an
award respectively: section 928 allows for atiurney’s fees if the employer
declines to pay compensation and an award is subsequently made and section
907(d) allows for recovery for medical expenses when the employer refuses to
furnish them. See also Ann., 49 ALR Fed. 425 (1984).

SAMPLE, ET AL. V. JOHNSON, ET AL. A — 23

AFFIRMED IN PART and REVERSED IN PART.

A-24

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

WILLIAM SAMPLE and
KAREN SAMPLE, husband
and wife, and JAMES

NO. C8&3-1060R

SHELTON,
ORDER GRANTING
Plaintiffs, DEFENDANTS' MOTION
FOR DISMISSAL OF
vs. WRONGFUL CONTROVER-

SION CLAIMS AND
STRIKING OTHER
MOTIONS AS MOOT

REGINALD JOHNSON,
et al.,

Defendants.

me ee ee eee ee ee ee eet ee eee See

THIS MATTER comes’ before the court on
cross motions concerning plaintiffs' claims
against defendants Seattle Stevedore
Company, Edward Lopit and Paul Tomita
(hereafter referred to collectively as
defendants). Defendants move to dismiss the
so-called wrongful controversion claims
pursuant to Fed. R. Civ. P. 12(b)(6) or,
dicerativery: pursuant to Fed. R. Civ. P.
56. Plaintiff William Sample moves for

partial summary judgment establishing

A-25

Seattle Stevedore's liability for wrongfully
controverting his claim to medical benefits
and monetary compensation. Having reviewed
the memoranda, PP eb ig and other
materials submitted in support of and in
opposition to these motions, and having
heard oral argument, the court finds that
defendants' motion is well taken.
Accordingly, defendants' motion to dismiss

the wrongful controversion claims must be

granted. The court does not reach plaintiff

1

At oral argument, counsel for
defendants stated that, in ruling on
defendants' motion to dismiss, defendants
would not object to the court's
consideration of the affidavits that are the
subject of plaintiffs' pending Motion for
Leave to file Supplemental Affidavits in
Opposition to Seattle Stevedore's Motion to
Dismiss. The court has considered the
affidavits. The motion for leave to file
the supplemental affidavits is hereby
stricken as moot.

A-26

Sample's motion for partial summary
judgment.

Plaintiffs William Sample and James
Shelton are injured longshoremen who filed
compensation claims under the Longshoremen's
and Harbor Workers' Compensation Act (LHWCA
or Act), 33 U.S.C. Sections 901-950.
Plaintiffs were employed by Seattle
Stevedore Company when they allegedly
sustained the injuries entitling them to
benefits under the Act. As the responsible
employer and a self-insurer under the Act,
Seattle Stevedore has a duty to provide
plaintiffs the LHWCA benefits to which they
are entitled. Defendant Edward Lopit, an
Assistant Claims Manager for Seattle
Stevedore, participated in the processing of
‘plaintiffs' LHWCA claims. Defendant Paul
Tomita is a certified vocational

rehabilitation counselor with whom Seattle

A-27

Stevedore contracted to provide job
placement services to plaintiff Shelton.
Plaintiffs commenced this action
alleging in a conclusory manner that
defendants Seattle Stevedore, Lopit and
Tomita acted in bad faith and fraudulently
by controverting plaintiffs' claims despite
knowledge that plaintiffs were entitled to
benefits under the Act, that no reasonable
grounds existed for controverting the
claims, and that the plaintiffs would be
deprived of LHWCA benefits pending a hearing
on their claims. Plaintiffs assert that
defendants' conduct violated the LHWCA,
admiralty and maritime law and the federal

2
common law, and caused plaintiffs to suffer

2
At oral argument plaintiffs' counsel
was asked whether the complaint stated any
Claims for relief under state law. In
reply, counsel stated that the tort of
(Footnote Continued)

I TT |

A-28

emotional and financial distress. See
Second Amended Complaint "Counts" IV and V.
Jurisdiction over these claims (referred to

by the parties, and by the court, as the

(Footnote Continued)
outrage was the cnly state law claim which
arguably had been alleged. Counsel further
stated that in the event the court dismissed
the claims under federal law, the court
would lack jurisdiction over the outrage
claim and a dismissal of this claim without
prejudice would be appropriate.

3

Plaintiffs have filed a motion for
leave to file a Third Amended Complaint.
According to plaintiffs "[t]he only arguable
new claim against defendants [in the Third
Amended Complaint] is the one which alleges
negligence in Shelton's vocational
rehabilitation process." Memorandum in
Support of Motion for Leave to File Third
Amended Complaint at 2. Adding this claim
to he allegations in the Second Amended
Complaint would not affect the court's
decision to dismiss Amended Complaint would
not affect the court's decision to dismiss
this action, so the court need not decide
whether plaintiffs should be granted leave
to file their Third Amended Complaint. The
motion for leave to file the Third Amended
Complaint is hereby stricken as moot.

A-29

wrongful controversion claims) is invoked
under 28 U.S.C. Sections 1331 and 1333.
Three issues are presented by
defendants’ motion: First, whether
plaintiffs' wrongful controversion claims
are cognizable in admiralty; second, whether
a violation of Section 907(a) or Section
908(c)(21) of the Act gives rise to a
private cause of action for damages; and
finally, whether plaintiffs' wrongful
controversion claims are barred by the
exclusive liability provision contained in

Section 905(a) of the Act. These issues

Ree

will be addressed in turn.

5 TROT

Ze
As an initial matter, it must be
determined whether this case falls within
the states ty jurisdiction of the court.
For a tort action like this to be cognizable

in admiralty, the tort must have "occurred

A-30

on or over navigable waters" (maritime
locality test) and "the tort must also arise
in the course of a traditional maritime
activity" (maritime relationship test).

Owens-Illinois, Inc. Vv. United States

District Court, 698 F.2d 967, 969-70 (9th
Cir. 1983). Plaintiffs' wrongful
controversion claims satisfy neither of
these tests.

The wrongful controversion claims are
based upon the actions taken by defendants
to controvert plaintiffs' LHWCA claims. The
acts complained of occurred solely on land,
so the maritime locality test cannot be met.
In urging the contrary conclusion plaintiff
confuse the locality where their injuries
entitling them to LHWCA benefits occurred
with the locality where the controversion of
their claims occurred. See Supplemental

Brief Re: New Matters Raised in Defendants'

A-31

Reply to Opposition to Motion for Protective
Order.

To determine whether an alleged tort
bears a significant relationship to
traditional maritime activity, this court
must consider four factors:

(1) traditional concepts of the role of

admiralty law; (2) the function and

role of the parties; (3) the types of
vehicles and instrumentalities
involved; and (4) the causation and

nature of the injury suffered.

Owens-Illinois, 698 F.2d at 970. In

Owens-Illinois, the Ninth Circuit held that
claims related to asbestos exposure which
occurred during the construction of ships
that were floating on navigable waters do
not bear a significant relationship to
traditional maritime activity. Id. at 971.
The facts in the instant case are even
weaker. |

No maritime vehicles or

instrumentalities were involved in the tort

EID RL API BES

A-32

which allegedly occurred here.
Traditionally, admiralty law has provided no
special protection to longshoremen. The
relationship between the parties is one of
employer and employee, or insurer and
beneficiary, neither of which has much to do
with admiralty. Lastly, the causation and
nature of the injury is more akin to the
state law tort of infliction of emotional
distress than to anything in admiralty law.
The causation and nature of the injury
suffered by plaintiffs is certainly not
unique to admiralty. The court finds that
the alleged wrongful controversion of
plaintiffs' compensation claims does not
bear A sieetticant relationship to
traditional maritime activity. Plaintiffs'
claims are not within the ambit of the

court's admiralty jurisdiction.

iI.

Plaintiffs assert that defendants
violated Sections 907 and 908 of the LHWCA
by terminating payment of medical and
compensation benefits to plaintiffs
notwithstanding knowledge that plaintiffs
are entitled to those benefits. See 33
U.S.C. Section 907(a) (the employer shall
furnish such medical treatment for such
period as the nature of . the injury
requires); 33 U.S.C. Section 908(c) (21)
(compensation for permanent partial
disability shall be two-thirds of the loss
in wage earning capacity, payable during the
continuance of the partial disability).
Asserting "{[i]Jt is black letter law that
violation of a statutory duty gives rise to
a cause of action under common law,"
plaintiffs contend that defendants' alleged
violation of the Act will support an action

for damages in federal court. Memorandum in

a

icine

A-34

Favor of William Sample's Motion for Summary
Judgment at 4. Plaintiffs are not seeking
recovery of the benefits prescribed by
Sections 907 and 908 of the Act; it is
undisputed that Seattle Stevedore ultimately
provided these benefits to plaintiffs.
Instead, plaintiffs claim damages for
emotional and financial distress allegedly
resulting from the failure of defendants to
timely provide the benefits.

Plaintiffs have apparently overlooked

Cort v. Ash, 422 U.S. 66 (1975) which sets

out four factors that are relevant in
determining whether a private right of
action may § be implied toc enforce the
provisions of a statute which does not

expressly provide such a right. The Cort v.

Ash factors are as follows:

First, is the plaintiff "one of
the class for whose especial
benefit the statute was enacted,"
--that is, does the statute create
a federal right in favor of the

A-35

663 F.2d 861, 864 (9th Cir. 1981), cert.
denied, 459 U.S. 881 (1982). Examination of

the second and third Cort v. Ash factors is

helpful in determining Congress’ intent.
Implying a private right of action for
damages resulting from violation of Sections
907 or 908 would be inconsistent with other
sections of the Act and its legislative
history. When considering what remedy was
appropriate where an employer failed or
refused to pay compensation or provide
medical treatment when due, Congress did not
expressly permit a private right of action.
The Act expressly provides for such actions
in only two situations: first, where the
employer fails to secure payment of
compensation and benefits as required by the
Act, 33 U.S.C. Section 905(a), and second,
where an employer fails to comply with a
final compensation order awarding benefits

to an injured employee, 33 U.S.C. Section

“ENE TRIE

A-36

treatment. But, the fact that rights were
conferred on certain individuals does not
necessarily lead to the conclusion that
Congress intended to create a private cause
of action for damages to remedy a denial of

the rights. Cf. Fisher v. City of Tucson,

663 F.2d 861, 864 {9th Cir. 1981), cert.
denied, 459 U.S. 881 (1982). Examination of

the second and third Cort v. Ash factors is

helpful in determining Congress' intent.
Implying a private right of action for
damages resulting from violation of Sections
907 or 908 would be inconsistent with other
sections of the Act and its legislative
history. When considering whet remedy was
appropriate where an employer failed or
refused to pay compensation or provide
medical treatment when due, Congress did not
expressly permit a private right of action.
The Act expressly provides for such actions

in only two situations: first, where the

A-37

employer fails to secure payment of
compensation and benefits as required by the
Act, 33 U.S.C. Section 905(a), and second,
where an employer fails to comply with a
final compensation order awarding benefits
to an injured employee, 33 U.S.C. Section
921(d). Rather than permitting a private
right of action, Congress provided certain
penalties for the failure to pay
compensation when due and provided for
reimbursement of employees who incur
expenses for medical treatment the employer
neglects or refuses to provide. See 33
U.S.C. Sections 914(e) and (f) (increasing
the amount of compensation due by 10% or
20%), 928(a) (attorney's fees), 907(d)
(reimbursement of medical expenses).
Permitting recovery of damages in addition
to the penalties provided by the Act, as
plaintiffs suggest, would arguable

contravene the exclusive liability

etn SRO ATe capone?

li a il AEA

A-38

provisions of the Act by extending an
employer's liability beyond the statutorily
prescribed liability. 33 U.S.C. Sections
905(a), 933(i). (See Section III for
discussion of the exclusive liability
provisions). The inconsistencies that would
result if a private right of action is
implied strongly suggest that Congress did
not intend to create such a remedy.

Implying a private cause of action for
violation of Sections 907 and 908 would also
be inconsistent with the underlying purpose
of the legislative scheme. The fundamental
purpose of the LHWCA is to assure that
prompt aid reaches the injured employee when
his need is greatest. This purpose is
attained by (1) imposing an absolute but
limited liability on employers for the
payment of medical and compensation benefits
to injured employees, and (2) resolving

disputes between employers and injured

A-39

employees through an administrative process
that emphasizes informal and nonjudicial
means of resolving disagreements. Implying
a private right of action would likely
increase the number of litigated disputes

thereby undercutting the administrative

dispute resolution procedure and increasing

the amount of the employers' limited

Le i GEA St

financial resources which are expended in
the defense of actions rather than in the

payment of benefits. cf. Oman Vv.

Johns-Manville Corp., 482 F. Supp. 1060,

1069 (E.D. Va. 1980), aff'd, 662 F.2d 243

(4th Cir. 1981). Also, holding employers

liable for amounts in excess of those :

prescribed by the Act would deprive
employers of the limited liability which is

the basis of all workmen's compensation

acts.

As to the fourth Cort v. Ash — factor,

providing workmen's compensation for injured

nein iadiaaiioauiel

A-40

longshoremen is clearly an area of federal
concern. On the other hand, to the extent
that the cause of action in question is
really one for emotional distress, it falls
within the bounds of traditional state tort
law. On balance, the court finds this
factor is not of particular influence in its
decision.

The court is convinced that Congress
did not intend to create a private right of
action for damages to remedy violations of
Sections 907 and 908 of the LHWCA. Congress
expressly created a private right of action
for violation of other, more fundamental
sections of the Act, which leads the court
to believe that the failure to provide such
a remedy for violation of Sections 907 and
908 was no mere oversight. The legislative
history contains no evidence that Congress

intended to create such a remedy. Instead,

the legislative history and the statutory

A-41

language suggest that Congress thought that
the way to deter violations of Sections 907
and 908 was to impose penalties that would
be assessed through the administrative
process. In these circumstances the court
will not isply a private cause of action.
The court therefore has no occasion to
decide whether defendants violated Sections

907 or 908 of the Act.

IIt.

The remaining issue before the court is
whether plaintiffs have stated a claim for
relief under the common law which is not
barred by the exclusive liability provision
of the Act. See 33 U.S.C. Section 905(a).
Section 905(a) provides that "[t)jhe
liability of an employer [under the Act]

shall be exclusive andin place of ail
other liability of such employer to the

employee... ." Id.; see, also, 33 U.S.C.

rr |

A-42

Section 933(1) (stating that recovery under
the Act is the exclusive remedy against
co-employees of the injured employee). The
Act imposes liability on an employer for
accidental injury or death arising out of
and in the course of employment. See 33
U.S.C. Sections 902(2), 904, 907-908. Thus,
an employer is generally not liable under
the Act for an intentionally inflicted
injury but, conversely, the employer does
not receive the benefit of the exclusive
liability provision for such injuries. See

Austin v. Johns-Manville Sales Corp., 508 F.

Supp. 313, 316 (D. Me. 1981).

In resolving the issue before the court
it should be remembered that the LHWCA
represents a compromise between the
competing interests of longshoremen and
their employers and that the’ exclusive

liability provision is a central element of

the compromise. "In return for the

A-43

guarantee of compensation, the employees
surrender common-law remedies against their
employers for work-related injuries. For
the employer, {who gives up certain
common-law defenses to liability] the reward
for securing compensation is immunity from
employee tort suits." Washington

Metropolitan Area Transit Authority Vv.

Johnson, 104 S.Ct. 2827, 2831-32 (1984).

Additionally, strengthening the exclusive
liability provision was one of the primary
purposes behind the 1972 amendments to the

Act. See Northeast Marine Terminal Co. _ v.

Caputo, 432 U.S. 249, 261-62 (1977).

The importance of the exclusivity
provision within the LHWCA scheme dictates a
broad interpretation of the phrase "arising
out of andin the course of employment,"
which delimits the accidental injuries
covered under the Act. 33 U.S.C. Section

902(2). Such an interpretation also permits

Det iimes w.

A-44

injured longshoremen to obtain benefits for
the broadest possible range of injuries.
Courts in several cases have viewed
expansively the injuries which are subject
to the exclusive liability provision. See,

e.g., Lindsay Vv. George Washington

University, 279 F.2d 819 (D.C. Cir. 1960);

Austin v. Johns-Manville Sales Corp., 508 F.

Supp. 313, 318 (D. Me. 1981).

The question presented in Lindsay was
whether the exclusive remedy provision of
the Act precludes an action for alleged
malpractice in the treatment of a
compensable injury at the employer's
hospital. | The court answered the question
in the affirmative, finding that the
employer is responsible under the Act for
all legitimate consequences that flow from a
compensable injury, . including the
unskillfulness or error of judgement by the

physicians furnishing the medical treatment

A-45

required by the Act. The court held that
the liability imposed by the Act was the
pliaintiff's exclusive remedy and that the
action was thus barred. Id. at 820-21.
Similarly, in the instant case recovery
under the Act should be the plaintiffs’
exclusive remedy against Seattle Stevedore
for any negligence in processing plaintiffs'
compensation claims.

As previously discussed in Section II,
Congress considered what remedy was
appropriate where an employer fails to pay
compensation or provide medical benefits in
a timely fashion. Congress enacted certain
penalties where are assessed whether’ the
failure is inadvertent or intentional. The
apparent purpose of these penalties is to
discourage the very sort of behavior alleged
here. These penalties are not
insubstantial: for example, on Shelton's

Claim the ALJ assessed almost $6,300 in

hints iai ists

aw tie Becntbs ae

A-46

attorney's fees and prejudgment interest
against Seattle eine.

In the great majority of cases a cause
of action has been held not to lie where it
is alleged that an employer or its insurer
wrongfully delayed or refused to make

compensation or medical payments when due.

2A A. Larson, Workmen's Compensation Law

Section 68.34(c) at 13-72. Larson opines
that "[{t]jhe temptation to shatter the
exclusiveness principle by reaching for’ the

tort weapon whenever there is a delay in

4

Plaintiffs' remedy under the Act for
the failure of Seattle Stevedore to provide
benefits when due is not necessarily limited
to the statutory penalties. Plaintiff
Shelton, for example, was awarded benefits
by the ALJ for his "Mental Health Sequelae"
which flowed from his physical injury. The
emotional distress for which Shelton now
seeks damages may have been a part of the
mental health problems considered by the
ALJ--which raises the possibility of a
double recovery against Seattle Stevedore.

A-47

paymerits or a termination of treatment is
all too obvious, and awareness of this
possibility has undoubtedly been one reason

for the reluctance of courts to recognize [a

cause of action] .. . except in cases of
egregious cruelty or venality." Id. at
13-76 (footnotes omitted). Larson cites

Martin v. Travelers Insurance Co., 497 F.2d

329 (ist Cir. 1974), upon which plaintiffs
rely, as a case where the defendant's
conduct was "conspicuously contemptible."
Id.

In Martin v. Travelers Insurance the

plaintiff, a LHWCA claimant, received three
drafts totalling over $5,700 from his former
employer's insurer in satisfaction of an
award under the Act. Two weeks after the
drafts were deposited and substantially
drawn upon, the insurer stopped payment on
them. This caused the plaintiff to suffer

financial embarrassment, emotional distress

Pe ea I i nie

ey ee ee

A-48

and severe physical impairment. 497 F.2d at
330. The plaintiff's suit, which alleged
tortious infliction of mental and emotional
suffering, was dismissed by the district
court pursuant to Fed. R. Civ. P. 12(b)(6).
The First Circuit reversed, holding that the
exclusive liability provision of the Act did
not preclude the plaintiff from pursuing
whatever independent state law remedy was
recognized for the insurer's conduct. Id.
at 331. Significantly, the court did not
find that violation of the LHWCA gives rise
to a private cause of action or that the bad
faith termination of LHWCA benefits is
itself actionable.

The court in Martin v. Travelers

Insurance had three alternative rationales

for its holding, one of which was that:

{t]he damage which is the basis of
this suit did not arise out of or
in the course of employment nor
was the damage caused by a third
person because of plaintiff's

A-49

employment. Instead the damage
was allegedly incurred in the
course of and arising out £ of
plaintiff's status as a claimant
seeking compensation, after his

status as an employee had
terminated.
Id. at 330-31. No authority was cited by

the court, nor was there any discussion of
the case law and policies reviewed above.

This court declines to follow Martin vv.

Travelers Insurance. Although the court can

understand the tendency to find Section
905(a) inapplicable where’ the defendant
violates the express and unambiguous terms
of the Act and serious injuries result to
the plaintiff, the court finds persuasive
the policies and reasoning discussed above,
in addition to the need for a uniform and
consistent rule. The court concludes that
the injuries alleged by plaintiffs do arise
out of and in the course of their

employment. Defendants are thus entitled to

erste Ueren Sd,

A-50

the protection of the exclusive liability
provision of Section 905(a).

It remains to be decided whether
plaintiffs have stated a claim for relief
under state law which falls within the
exception to Section 905(a) for
intentionally inflicted injuries. At oral
argument, counsel for plaintiffs indicated
that the tort of intentionally inflicted
emotional distress (outrage) was the oniy
state law claim arguably alleged in the
Second Amended Complaint. The complaint
does not allege that the plaintiffs suffered
severe emotional distress, that the
emotional distress was inflicted

5
intentionally or recklessly, or that the

5

Section 905(a) would bar an outrage
claim based on recklessly inflicted
emotional distress. To fall within the

exception to Section 905(a), plaintiffs must
(Footnote Continued)

A-51

conduct of the defendants was outrageous and
extreme. Each of these allegations is an
essential element of a claim for outrage.

Grimsby v. Samson, 85 Wn. 2d 52 (1975).

Accordingly, the court finds that the
complaint does nct allege an outrage claim
or any other state law claim for

intentionally inflicted injury. Cf. Bowe v.

Eaton, 17 Wn. App. 840, 845 (1977). The
court need not decide whether plaintiffs
could allege a state law claim for
intentionally inflicted injury because even
if such a claim was stated, this court would

lack subject matter jurisdiction over it.

(Footnote Continued)

prove that their emotional distress was
intentionally inflicted by defendants.
Austin v. Johns-Manville Sales Corp., 508 F.
Supp. 313, 316 (D. Me. 1981).

IV.

In conclusion, the court has ruled (1)
that plaintiffs' claims are not cognizable
in admiralty, (2) that a private cause of
action does not exist for violation of the
LHWCA, and (3) that Section 905(a) bars’ the
plaintiffs' claims. Finding that no genuine
issues of material fact exist, and that
defendants are entitled to judgement as a
matter of law, defendants' motion for
dismissal is hereby GRANTED.

IT IS SO ORDERED.

The Clerk of the Court is directed to
forward copies of this Order to counsel of
record.

DATED at Seattle, Washington this 13th

day of August, 1984.

BARBARA J. ROTHSTEIN,
UNITED STATES DISTRICT JUDGE

A-53

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

WILLIAM SAMPLE and
KAREN SAMPLE, husband
and wife, and JAMES
SHELTON,

NOS. 84-4134,
84-4240

D.C.No. CV-83-1060R
Plaintiffs-
Appeilants/cross-
appellees,

ORDER

vs.

REGINALD JOHNSON,
et al.,

Defendants-
Appellees/cross-

)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
appellants. )
)

Before: PREGERSON, and WIGGINS, Circuit
x

Judges and SCHNACKE,

Plaintiffs' petition for rehearing is

denied.

*

Honorable Robert R. Schnacke, United
States District Judge for the Northern
District of California, sitting by
designation.

A-54

The opinion filed on September 20, 1985
is hereby amended as follows:

On page 2, the first paragraph of the
"FACTS" is amended to read:

"The facts are not disputed. Sample
was injured on March 28, 1983; Shelton was
injured on April 26, 1982. Sample received
compensation from Seattle Stevedore from
April 8 to June 1, 1983. The employer
controverted his claim on June 15, 1983, and
a hearing was held before an ALJ on March
17, 1984. On April 24, 1984, Sample
received an award of LHWCA compensation.
Sample was without income during the more
than ten months between the controversion
and the award."

On page 20, line 24, “contravention" is

amended to read “controversion,."

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385018_1324%3A1. Public record. Not legal advice.