Opposition Brief — Union Texas Petroleum Corp. v. State Service Co.

No. 90-60 |

_ eels —

In The - ane

Supreme Court of the United States* _ |

October Term, 1989

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UNION TEXAS PETROLEUM CORPORATION, AGIP

PETROLEUM COMPANY and MINATOME

CORPORATION,

Petitioners,

versus

P LT ENGINEERING, INC., STATE SERVICE

COMPANY, INC., POWER WELL SERVICE, INC.,

GULF ISLAND-IV, BROWN & ROOT USA,

INC. and SUB SEA INTERNATIONAL, INC.,

Respondents.

— —- a

Petition for Writ of Certiorari

to the United States Court of Appeals

for the Fifth Circuit

aapneeenemannmeneanmm ----@— -- ee

BRIEF IN OPPOSITION OF RESPONDENT,

STATE SERVICE COMPANY, INC.

——_—_______—_____@___—_

JupiTH A. KAUFMAN

Lowe, STEIN, HOFFMAN

A.tiweiss & HAUVER

2450 Poydras Center

650 Poydras Street

New Orleans, Louisiana 70130

Telephone: (504) 581-2450

August 35, 1990

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 242-2831

QUESTIONS PRESENTED

Whether state law, as the surrogate federal law under

Section 4 of the Outer Continental Shelf Lands Act, 43

U.S.C. § 1333, applies to contracts for construction of

a pipeline on the outer Continental Shelf.

Whether Section 4 of the Outer Continental Shelf

Lands Act, 43 U.S.C. § 1333, supercedes a state law’s

choice of law rule.

Whether Section 4 of the Outer Continental Shelf

Lands Act, 43 U.S.C. § 1333, operates to extend the

boundaries of the State of Louisiana to the outer

margin of the outer Continental Shelf for purposes of

determining in which parish a lien should be

recorded under the Louisiana Oil Well Lien Act.

ii

TABLE OF CONTENTS

Page

OCUESTIONS PRESENTED oo cic s cise scesennnes i

pei RGs Sas). )) Serr Terr ST ii

TABLE COR PU TERA IIe eS oa ei ace an senss iil

STATEMENT OF THE CADE... 0.5 cick ccc vccasas 1

REASONS FOR DENYING WRIT ...............55: 4

Pio d) | rere er errr err rere TL ey 7

THE FIFTH CIRCUIT’S DECISION FOLLOWED

THIS COURT’S REASONING IN HERB’S WELD-

ING AND APPLIED THE PROPER ANALYSIS

WHEN IT HELD THAT CONTRACTS FOR THE

CONSTRUCTION OF A,PIPELINE ON THE

OUTER CONTINENTAL SHELF ARE GOV-

2 ok fs oe © rrr errr rrr rr ree 7

THE FIFTH CIRCUIT’S DECISION BELOW FOL-

LOWS THIS COURT’S PRIOR RULING THAT

THE OUTER CONTINENTAL SHELF LANDS

ACT SUPERCEDES A STATE’S CHOICE OF

Fg eer Tete eee re 13

THE FIFTH CIRCUIT’S DECISION BELOW

CORRECTLY INTERPRETS SECTION 4 OF

OCSLA, 43 U.S.C. § 1333, WHICH OPERATES

TO EXTEND THE BOUNDARIES OF THE STATE

OF LOUISIANA TO THE OUTER CONTINEN-

TAL SHELF FOR PURPOSES OF DETERMINING

IN WHICH PARISH A LIEN SHOULD BE

RECORDED UNDER THE LOUISIANA OIL

i RT Oe ty ee reeeeTeT Terre ee rrr 14

ee ea 8 | err eee rere ere rr 17

iii

TABLE OF AUTHORITIES

Page

CASEs:

Chevron Oil Co. v. Huson, 404 U.S. 97 (1971)...7, 13, 16

Corbitt v. Diamond M. Drilling Co., 654 F.2d 329

ea G Geese ken noes esacessvcecass 5

Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473

EE UR SECM hens esses escsasences 7, 3, 16

Ferb’s Welding, Inc. v. Gray, 470 U.S. 414 (1985) . passim

Kossick v. United Fruit Co., 365 U.S. 731 (1961)........ 9

Laredo Offshore Constructors, Inc. v. Hunt Oil Co.,

yam eee taeo qoem Cir. 1965)................ mm 2% Ta

Lewis v. Glendel Drilling Co., 898 F.2d 1083 (5th Cir.

SCG R yaa G sae ayes ctr cvcscesasceccee 6, 10

Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207

TSG Sheek sas see ckccccavccsesnsss 6, 10

Pippen v. Shell Oil Co., 661 F.2d 378 (5th Cir. 1981)..... 5

Rodrigue v. Aetna Casualty and Surety Co., 395 U.S.

Senne 6, 7, 10, 13, 14

Theriot v. Bay Drilling Corp., 783 F.2d 527 (5th Cir.

eRe ashy ebb n Shea s eee eeseaciecccess 5, 6

Thurmond v. Delta Well Surveyors, 836 F.2d 952 (5th

ee Ca si Sw kas sce secncrcsaccs » 6

Union Texas Petroleum v. PLT Engineering, Inc., 895

F.2d 1043 (Sth Cir. 1990)......... it PRA Tee > %, 12

STATUTES:

eee eh sacs 6 bce ss cccessccccesss 3

SOT EL ETE TEETER TEE 15

TABLE OF AUTHORITIES - Continued

Page

OF Rs I BOE cco shee kaw ees ke ess nue eee eeeees-ees 3

2 ae eh . Serer rere sre ee 7, 14, 15

Br EPs OP ON as cc ccesensnseeceucsbacsusuancesehess 8

OTHER AUTHORITIES:

Conference Report No. 1031, 83d Cong., First Ses-

oR tee re eer rrr ere ee 7, 15

No. 90-60

vr

In The

Supreme Court of the United States

October Term, 1989

a

vv

UNION TEXAS PETROLEUM CORPORATION, AGIP

PETROLEUM COMPANY and MINATOME

CORPORATION,

Petitioners,

versus

P L T ENGINEERING, INC., STATE SERVICE

COMPANY, INC., POWER WELL SERVICE, INC.,

GULF ISLAND-IV, BROWN & ROOT USA,

INC. and SUB SEA INTERNATIONAL, INC.,

Respondents.

»

sd

Petition for Writ of Certiorari

to the United States Court of Appeals

for the Fifth Circuit

A.

—_

BRIEF IN OPPOSITION OF RESPONDENT7,

STATE SERVICE COMPANY, INC.

-%

4

STATEMENT OF THE CASE

Union Texas Petroleum Corporation (hereafter

“UTP”), AGIP Petroleum Company, Inc. (hereinafter

“AGIP”) and Minatome Corporation (hereinafter “Min-

atome”) own a leasehold on which the pipeline in ques-

tion was constructed. This leasehold is located adjacent to

the State of Louisiana in Vermillion block 237 on the

federal outer Continental Shelf. UTP was designated as

the operator of the oil and gas wells located or to be

located on the lease. The owners, UTP, AGIP and Min-

atome, initiated a project to construct a gas transportation

system to enable them to transfer gas produced on the

lease to a 36 inch blue water pipeline owned by Columbia

Gas Company.

To that end, UTP entered into a contract with PLT

Engineering Company, Inc. (“PLT”) for the design, fabri-

cation and installation of a gas transportation system.

PLT contracted with State Service Company, Inc. (“State

Service”) to furnish materials and/or to provide services

to be used in the construction, operation and/or repair of

the gas transportation system.' PLT also contracted with

Brown & Root U.S.A., Inc. (“Brown & Root”), and Sub Sea

International, Inc. (“Sub Sea”). PLT entered into these

various subcontracts in order to achieve its principal

obligation under its contract with UTP: to design, fabri-

cate and install an underwater gas transportation line

from a platform owned by UTP, AGIP and Minatome over

the outer Continental Shelf to a side tap in the blue water

pipeline.

In order to perform its obligations, State Service con-

tracted with Power Well Service, Inc., (“Power Well”).

1 Pursuant to Rule 28.1 of the Rules of the Supreme Court,

State Service informs the Court that there are no parent com-

panies, subsidiaries or affiliates of State Service.

Power Well provided State Service with . vessel, the

GULF ISLAND IV, which was used to assist State Service

in performing its activities on the ocean floor.

State Service’s principal obligation on the project,

much akin to PLT’s obligation, was to fabricate and install

the side tap connecting UTP’s production platform to its

twelve inch pipeline, all of which were located on federal

block area 237 Vermillion, and fabricate and install the

hot tap assembly tie-in to the Columbia Gas Company

pipeline located on federal block area 225 Vermillion.

State Service also performed extra work for PLT on PLT’s

and UTP’s request. The extra work primarily involved

additional excavation to bury the pipeline.

With the services of State Service and the other sub-

contractors, PLT successfully completed the construction

and installation of the pipeline. Subsequently, UTP

learned that PLT had not paid its subcontractors. In

accordance with the contract provision between UTP and

PLT, UTP withheld $420,045.59 from the amount due

under the contract and then instituted an interpleader

action under Fed.R.Civ.P. 22. State Service answered the

complaint and filed its counterclaim asserting a lien pur-

suant to the Louisiana Oil Well Lien Act, LSA-R.S.

§ 9:4861, et seq. (“LOWLA”).

After cross motions for summary judgment, the dis-

trict court held that: (1) the Outer Continental Shelf

Lands Act, 43 U.S.C. 1331 et seq. (hereinafter “OCSLA”)

applied because the activities involved were not tradi-

tionally maritime, therefore, federal admiralty law was

not applicable; (2) the choice of law provisions in the

subcontracts were unenforceable; (3) LOWLA was appli-

cable as the surrogate federal law through OCSLA; and

(4) the recordation requirements for the lien pursuant to

Louisiana Law were met. The Fifth Circuit Court of

Appeals, for somewhat differeat reasons, affirmed the

holding of the district court. Thereafter, UTP petitioned

this Court for review of that decision.

»

_

REASONS FOR DENYING WRIT

1. The decision of the Fifth Circuit Court of Appeals

in this action does not conflict with a decision of any

other circuit court of appeals. The matter presently before

this Court involves only decisions arising out of the Fifth

Circuit. Apparently, there may be a conflict in the Fifth

Circuit with respect to some issues raised in UTP’s Peti-

tion for Writ of Certiorari. The Fifth Circuit, however, has

not yet had the opportunity to resolve the apparent con-

flict. The matter is currently before the Fifth Circuit for

consideration en banc.

The apparent conflict within the Fifth Circuit stems

from decisions from the court which preceded this

Court’s decision in Herb’s Welding, Inc. v. Gray, 470 U.S

414 (1985). Herb’s Welding limited the Fifth Circuit's

expansive view of maritime law and held that a worker

performing the tasks of building and maintaining pipes

and platforms on the outer Continental Shelf was not

engaged in maritime employment.

Some Fifth Circuit decisions before Herb’s Welding

have held that contracts for offshore drilling and mineral

operations from a vessel are maritime in nature. See Pip-

pen v. Shell Oil Co., 661 F.2d 378 (5th Cir. 1981); and Corbitt

v. Diamond M. Drilling Co., 654 F.2d 329 (5th Cir 1981).

Although decided subsequent to Herb’s Welding, Theriot v

Bay Drilling Corp., 783 F.2d 527 (5th Cir. 1986), also held

that certain contracts for mineral exploration conducted

from a vessel are maritime. Theriot, however, relied exch-

sively upon cases which predate Herb’s Welding.’

Other decisions, however, have looked beyond the

mere use of a vessel in mineral exploration to determine

whether the primary activity is maritime in nature. Those

decisions focus on the principal obligation of the contract

and have held that where the contract calls for construc-

tion and services peculiar to the oi] and gas industry, the

contract is nonmaritime even though the contract contem-

plates the use of instruments of admiralty. Consequently,

state law, through OCSLA, applies. See Thurmond v. Delta

Well Surveyors, 836 F.2d 952, 955 (Sth Cir. 1988) and Laredu

Offshore Constructors, Inc. v. Hunt Oil Co., 754 F.2d 1223,

1231-1232 (Sth Cir. 1985). The decision below follows the

holdings of Thurmond and Laredo and employs the “prin-

cipal obligation” test of those cases. The decision also

follows the reasoning of Herb’s Welding and precludes the

application of maritime law when the work performed on

the outer Continental Shelf involves the construction of a

pipeline.

2 In addition to relying on cases which predate Herb’s

Welding, Theriot is clearly distinguishable on its facts. As the

Fifth Circuit stated, “since no drilling on navigable waters

from a vessel is involved here, Theriot is not controlling.”

Union Texas Petroleum v. PLT Engineering, Inc., 895 F.2d 1043,

1049 (Sth Cir. 1990).

Lewis v. Glendel Drilling Co., 898 F.2d 1083 (5th Cir.

1990), a case subsequent to the decision below, called into

question the validity of Theriot and noted the disparity

among the cases which have addressed issues raised in

UTP’s writ. Although the Lewis court recognized that the

Thurmond view that a movable offshore oil and gas rig,

moored and engaged in exploration or production, is not

a vessel and thus does not involve maritime law is the

more realistic view, the Lewis court nonetheless followed

the Theriot holding. Id. at 1086-1087. Because of the con-

flict in the decisions in the Fifth Circuit on this matter, the

Lewis court suggested that the matter should be reviewed

and decided by the court en banc. As noted in UiP’s

Application for Extension of Time to File Petition for Writ

of Certiorari, the Lewis decision, which involves issues

common to the instant case, is pending before the Fifth

Circuit on UTP’s request for a hearing en banc. Therefore,

because the issues raised in UTP’s writ involve only a

conflict within the Fifth Circuit, and because those issues

are presently before the Fifth Circuit for consideration en

banc, UTP’s request for review by this Court should be

denied. The Fifth Circuit should be given an opportunity

to do its own housecleaning before this Court should

intervene. Moreover, UTP should have asked the Fifth

Circuit for a rehearing en banc in this case.

2. The decision of the Fifth Circuit Court of Appeals

in this action does not conflict with prior decisions by

this Court in Rodrigue v. Aetna Casualty and Surety Co., 395

U.S. 352 (1969); Herb’s Welding, 470 U.S. 414; and Offshore

Logistics, Inc. v. Tallentire, 477 U.S. 207 (1986). Those cases

have analyzed the application of OCSLA and have held

that activities performed on the seabed, the subsoil and

the structures on the outer Continental Shelf are gov-

erned by OCSLA. Certainly, construction of a pipeline

necessarily requires work on the seabed and subsoil.

Pipelines do not float on the water.

3. The decision below follows this Court’s prior rul-

ings in Chevron Oil Co. v. Huson, 404 U.S. 97 (1971) and

Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473 (1981)

which held that OCSLA supercedes a state’s choice of law

rules. Therefore, the Fifth Circuit herein correctly held

that the maritime choice of law provision in the contracts

was unenforceable.

4. The Fifth Circuit’s holding that the parishes adja-

cent to the outer Continental Shelf are the proper par-

ishes in which to record a lien under LOWLA is

consistent with OCSLA, 43 U.S.C. § 1333 and the intent of

Congress to extend the boundaries of the state seaward to

the outer margin of the outer Continental Shelf in order

to determine which state law applies to the subsoil, sea-

bed and fixed structures of the outer Continental Shelf.

Con. Rep. No. 1031, 83 Cong. First Session 2 (1953).

,%

vw

ARGUMENT

THE FIFTH CIRCUIT’S DECISION FOLLOWED THIS

COURT’S REASONING IN HERB’S WELDING AND

APPLIED THE PROPER ANALYSIS WHEN IT HELD

THAT CONTRACTS FOR THE CONSTRUCTION OFA

PIPELINE ON THE OUTER CONTINENTAL SHELF

ARE GOVERNED BY OCSLA.

This Court stated the purpose of OCSLA in Rodrigue

as follows:

The purpose of the Lands Act was to define

a body of law applicable to the seabed, the

subsoil, and the fixed structures . . . on the outer

Continental Shelf. That this law was to be fed-

eral law of the United States, applying state law

only as federal law and then only when not

inconsistent with applicable federal law, is made

clear by the language of the Act.

395 U.S. at 355-56.

In Herb’s Welding, this Court criticized the Fifth Cir-

cuit’s “expansive view of maritime employment” and

reversed the Fifth Circuit, finding that

[t]he history of the Lands Act at the very least

forecloses the Court of Appeals’ holding that

offshore drilling is a maritime activity and that

any task essential thereto is maritime employ-

ment for LHWCA purposes.

470 U.S. at 422.3 This Court also found in Herb’s Welding

that there is nothing inherently maritime about the con-

struction and maintenance of pipelines and stated that

those tasks “are also performed on land, and their nature

is not significantly altered by the marine environment,

particularly since exploration and development of the

Continental Shelf are not themselves maritime com-

merce.” 470 U.S. at 425. The decision below follows the

reasoning and principles of Herb’s Welding.

3 Herb’s Welding involved the application of the Long-

shoremen’s and Harborworkers’ Compensation Act (LHWCA),

33 U.S.C. §§ 901, et seq. As the court below noted, the threshold

question under both LHWCA and OCSLA is whether the dis-

pute arises out of traditional maritime activity.

The Fifth Circuit herein stated that in order to apply

state law as the surrogate federal law under OCSLA,

three conditions must be met: (1) the controversy must

arise on an OCSLA location (i.e., the subsoil, seabed, or

artificial structures permanently or temporarily attached

thereto); (2) federal maritime law must not apply of its

own force; and, (3) the state law must not be inconsistent

with federal law. Union Texas Petroleum v. PLT Engineering,

Inc., 895 F.2d 1043, 1047 (5th Cir. 1990). The Fifth Circuit

found that all of those conditions were met in the present

case. In fact, UTP admits that the controversy arises on an

OCSLA location and concedes for the purpose of argu-

ment that the state law at issue here is not inconsistent

with any federal law. UTP, however, contends that the

activity conducted on the outer Continental Shelf was

maritime. Thus, the only question which remains is

whether the contracts at issue are maritime in that they

“relate[s] to ships and vessels, masters and mariners, as

agents of commerce... .” Kossick v. United Fruit Co., 365

U.S. 731, 736 (1961), citing I Benedict, Admiralty 131. As

the court below correctly held, the contracts are not mar-

itime.

Each contract involved a common goal: the construc-

tion and installation of a pipeline located in its entirety

on the outer Continental Shelf. Surely, as this Court has

stated, such an activity is not inherently a maritime activ-

ity. See Herb’s Welding, 470 U.S. at 425. Each party was to

perform various services in connection with the construc-

tion of that pipeline. While UTP basically admits at page

16 of its Petition for Writ of Certiorari that the installation

of the pipeline on the outer Continental Shelf is not

maritime, UTP nonetheless takes the position that

10

because such activity utilizes vessels and divers to assist

in the project that that, in and of itself, removes the

activity from the realm of OCSLA.

UTP’s reasoning is illogical. Under UTP’s reasoning,

OCSLA would never apply because in order to reacn the

ocean floor one must necessarily use divers and/or ves-

sels. UTP’s argument precludes application of OCSLA to

activities performed on the ocean floor and is in direct

confiict with decisions of this Court which have already

endorsed the Congressional mandate that OCSLA applies

to activities performed on the seabed, subsoil and the

fixed structures on the outer Continental Shelf. Herb’s

Welding, 470 U.S. 414, Rodrigue, 395 U.S. 352, Tallentire,

477 US. 207.

UTP also stresses that a divergent line of authority

has arisen as to whether mineral exploration activity on

the outer Continental Shelf is a maritime transaction. As

mentioned, that divergent line of authority may only

appear within the Fifth Circuit, and the issue is presently

pending before the Fifth Circuit for consideration en banc.

The Fifth Circuit may or may not eliminate any con-

fusion. Moreover, as the decision below notes, those lines

of authorities which hold that drilling operations con-

ducted from a vessel are maritime generally predate

Herb’s Welding.4

4 Although Lewis, 898 F.2d 1083, is subsequent to Herb’s

Welding, the Lewis court recognized that Herb’s Welding may

affect the validity of those holdings and specifically suggested

that the matter should be considered en banc.

11

The Fifth Circuit herein and in Laredo, 754 F.2d 1223,

followed this Court’s reasoning in Herb’s Welding. Laredo

addressed essentially the same arguments which UTP

sets forth here. There, Laredo argued that because the

contract for the construction of a well platform on the

outer Continental Shelf required the use of vessels and

seamen, the contract was maritime and OCSLA did not

apply. The court, however, held that:

The contract involved here . . . did more than

charge Laredo with the responsibility of carry-

ing workers and supplies to the well site.

Laredo’s principal obligation under the contract

was the construction of a stationary platform,

and, as Laredo conceded at oral argument, it is

the alleged breach of this contract that gave rise

to the instant action. While the contract no

doubt contemplated the hiring of vessels and

seamen to build the structure, the subject of this

case has no direct relationship with these tradi-

tional subjects of maritime law. It is fundamen-

tal that the mere inclusion of maritime

obligations in a mixed contract does not, with-

out more, bring nonmaritime obligations within

the pale of admiralty law. That the contract con-

templated in part the use of instruments of

admiralty, therefore, is not sufficient to oust

OCSLA - adopted state law in this case.

Id. at 1231-32.

The contracts involved in the present action pertain

to the construction of a pipeline. As in Laredo, it is the

breach of those contracts which gave rise to the instant

controversy. As this Court noted in Herb’s Welding, the

construction of a pipeline does not render that activity

maritime merely because it occurred in a marine environ-

ment. 470 U.S. at 425. State Service actually performed

12

work on the ocean floor and near a riser attached to the

UTP platform. Those activities took place on OCSLA

locations. Under a plain reading of the Act, OCSLA

applies. The fact that State Service had to use divers to

get to the bottom of the sea does not transform the

activity into a traditional maritime activity, precluding

the application of OCSLA. Union Texas Petroleum, 895 F.2d

1043; Laredo, 754 F.2d 1223.

UTP, however, seems to believe that it is significant

that the contract in Laredo called for a single contract to

construct a platform, whereas the present matter involves

various subcontracts to construct the pipeline. If PLT was

able to construct the pipeline without the services of

others, then it would have performed the same work as

State Service and the other subcontractors; PLT would

have also had to utilize vessels and divers. Would UTP

have this Court hold that a contract for construction on

the outer Continental Shelf is governed by OCSLA only

when there are no subcontractors involved? To argue that

the Court should analyze each subcontract individually

as to the nature of the activity involved in each sub.

contract would only serve to add more confusion in the

law. Under UTP’s argument, the services performed by

State Service would be governed by OCSLA only while

its workers were on the ocean floor. Any matter that

involved services beyond that would be governed by

maritime law. This approach makes no sense and would

serve to create mass confusion. As the court below found,

the principal obligation of PLT and the subcontractors

was to build the pipeline and connect it to UTP’s plat-

form and transmission line. 895 F.2d at 1049. In line with

Herb’s Welding, the court concluded that such activities

13

were not traditionally maritime and thus maritime law

would not apply.

Because the decision below merely applies the princi-

ples of Herb’s Welding in concluding that the construction

of a pipeline on the outer Continental Shelf is not a

maritime activity, the decision does not conflict with

prior decisions of this Court in analyzing the application

of OCSLA. Moreover, because there is no conflict among

the various circuits on this issue and because the only

conflict which might exist is within the Fifth Circuit

where a consideration en banc is currently pending, UTP’s

writ should be denied.

THE FIFTH CIRCUIT’S DECISION BELOW FOLLOWS

THIS COURT’S PRIOR RULING THAT OCSLA

SUPERCEDES A STATE’S CHOICE OF LAW RULES

The Fifth Circuit’s holding that OCSLA’s mandated

choice of law provision requires the application of the

law of the adjacent state even in the presence of a choice

of law provision in the contract to the contrary is not at

variance with prior statements by this Court. This issue

has been put to rest by this Court in Huson, 404 U.S. 97,

and Gulf Offshore, 453 U.S. 473. In Gulf Offshore, this Court

succinctly stated that “OCSLA does supercede the normal

choice of law rules that the forum would apply.” 453 U.S.

at 482 n.8. To hold otherwise and adopt the argument set

forth by UTP that the maritime choice of law provision

should apply would only serve to “subvert the congres-

sional intent documented in Rodrigue, . . . that admiralty

doctrine should not apply under the Lands Act.” Huson,

404 U.S. at 104.

14

Thus, the holding of the Fifth Circuit is not only

consistent with prior decisions of this Court, but is in line

with the intent of Congress to create a body of law on the

outer Continental Shelf for which maritime law was not

suited. Consequently, even under Louisiana conflict of

law principles, the party’s stipulation as to the choice of

law to govern the contract must not be given effect

because there is jurisprudential law from this Court and

statutory law stemming from OCSLA which requires the

court to refuse to honor the contract’s choice of law

provision. This Court must take note that there was no

contractual choice of law provision between UTP and

State Service: no contractual relationship between the two

existed. Therefore, the decision below does not raise any

important question which conflicts with prior decisions

of .his Court with respect to the mandated choice of law

provisions of OCSLA.

THE FIFTH CIRCUIT’S DECISION BELOW COR-

RECTLY INTERPRETS SECTION 4 OF OCSLA, 43

U.S.C. § 1333, WHICH OPERATES TO EXTEND THE

ROUNDARIES OF THE STATE OF LOUISIANA TO

THE OUTER CONTINENTAL SHELF FOR PURPOSES

OF DETERMINING IN WHICH PARISH A LIEN

SHOULD BE RECORDED UNDER LOWLA.

Because federal laws are inadequate to cope with the

full range of potential legal problems which may arise on

the outer Continental Shelf, and rather than create a new

body of federal law, Congress chose to borrow the law of

the adjacent states to fill in the gaps of federal law. See

Rodrigue, 395 U.S. at 357-358. In determining which state

laws would be adopted as the federal law on the outer

Continental Shelf, Congress adopted the state laws “for

15

the area of the shelf that would be in the boundaries of

the state if such boundaries were extended seaward to the

outer margin of the outer shelf.” Con. Rep. No. 1031, 83d

Cong. First Session, 2 (1953).

Louisiana Law is the surrogate federal law in this

matter pursuant to 43 U.S.C. Section 1333(a)(2)(A) as “if

its boundaries were extended seaward to the outer mar-

gin of the outer Continental Shelf”. LOWLA requires

recordation of a lien in the parish where the property is

located in order to preserve the privilege granted by the

Act. Because UTP’s property is located in federal terri-

tory, this restriction interferes with the application of

state law on federal land; therefore, the Fifth Circuit

properly extended the boundaries of Vermillion Parish to

the outer margin of the outer Continental Shelf in order

to apply Louisiana Law as the surrogate federal law to

the work performed by State Service. This decision is not

only consistent with the construction of OCSLA, but is

also consistent with Louisiana state law at LSA-R.S. 49:6,

which provides that:

the gulfward boundary of all said coastal par-

ishes extend coextensively with the gulfward

boundary of the State of Louisiana.

The Fifth Circuit’s decision does not constitute judi-

cial legislation; rather, the decision logically interprets

OCSLA and the Louisiana state law in order to determine

the appropriate parish in which to file a lien for work

performed on the outer Continental Shelf. UTP’s position

that a lien cannot be perfected for work performed on the

outer Continental Shelf would result in denying any con-

tractor or subcontractor a lien in any construction con-

tract on the outer Continental Shelf. It would be

16

anomalous to deny a lien to State Service when the prin-

cipal purpose of adopting state law under OCSLA was to

protect those, like State Service, who provide labor, ser-

vices, or materials on the outer Continental Shelf. See, e.g.

Huson, 404 U.S. at 103-04. The Fifth Circuit recognized

this anomaly and filled the gap that exists in the law. This

reconciliation was reasonable to implement the mandate

of Congress which requires state law to apply to work

performed on the outer Continental Shelf.

Furthermore, contrary to UTP’s contention, this

extension of the boundaries of the State of Louisiana was

not specifically rejected by Congress. As in Gulf Offshore,

453 U.S. 473, UTP’s argument confuses the political juris-

diction of a state with its judicial jurisdiction. Section

1333(a)(3) addresses the geographical boundaries of a

state because Congress’ primary focus in enacting

OCSLA was to assure federal control over the shelf and

its resources. The language was intended to make it clear

that the adoption of state law could not be a basis for a

State to make a claim to participate in the administration

of or revenues from areas outside the State’s boundaries.

The language of the provision does not refer to causes of

action by a party under state law. Id. at 482.

The present matter involves judicial jurisdiction: the

operation of state law by extending the boundaries of the

parishes of the State of Louisiana to the outer margin of

the outer Continental Shelf in order to apply state law to

determine in which parish a lien should be filed pursuant

to LOWLA. Thus, because the decision below is consis-

tent with OCSLA and state law, consideration by this

Court is unwarranted and UTP’s writ for certiorari

should be denied.

*

17

CONCLUSION

Petitioners have failed to show that the decision of

the Fifth Circuit is in conflict with the decisions of this

Court which have analyzed and addressed the applica-

tion of OCSLA. Moreover, petitioners have failed to show

that the decision below is in conflict with a decision from

any other circuit court of appeals. If any conflict exists, it

may exist within the Fifth Circuit where some of the

issues raised in petitioner’s writ of certiorari are pres-

ently before the Fifth Circuit for consideration en banc.

The Fifth Circuit may resolve these issues. Consequently,

petitioners have failed to demonstrate that their writ of

certiorari is warranted and therefore, it should be denied.

Respectfully submitted,

MitcHet. J. HorrMAN*

JupirH A. KAUFMAN

Lowe, STEIN, HOFFMAN,

Attweiss & HAUVER

2450 Poydras Center

650 Poydras Street

New Orleans, Louisiana 70130

Telephone: (504) 581-2450

Attorneys for Respondent

State Service Company, Inc.

* Counsel of Record