Petition for Writ of Certiorari — National Shipping Co. of Saudi Arabia v. Moran Trade Corp. of Delaware

oo Supremé Court, U.S.

(1) FILER

No.9? 1149 JAN - 5 1998

OFFICE OF THE CLERK

In The

Supreme Court of the United States

hp

October Term, 1997

NATIONAL SHIPPING COMPANY OF SAUDI ARABIA,

Petitioner,

vs.

MORAN TRADE CORPORATION OF DELAWARE, MORAN

TOWING OF VIRGINIA, A DIVISION OF MORAN MID-

ATLANTIC CORPORATION,

Respondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals for the Fourth Circuit

PETITION FOR A WRIT OF CERTIORARI

JOHN R. CRUMPLER, JR. PATRICK J. BONNER

KAUFMAN & CANOLES, P.C. Counsel of Record

2000 Nations Bank Center FREEHILL, HOGAN & MAHAR

One Commercial Place 80 Pine Street

P.O. Box 3037 New York, NY 10005

Norfolk, VA 23514 (212) 425-1900

(757) 624-3103

Attorneys for Petitioner

utz

T2734 (800) 3 APPEAL « (800) 5 APPEAL « (800) BRIEF 21 L late

ervices, inc.

A DIVISION OF COUNSEL PRESS

i

QUESTIONS PRESENTED FOR REVIEW

1. Is it permissible to imply federal preemption of state

and common law claims into OPA 90, 33 U.S.C. § 2701, et seq.

when the Act expressly provides reliable indicia of the

Congressional intent with respect to state and common law

claims?

2. Can state and common law remedies, when expressly

reserved in one section of an Act, be restricted in other sections

of the same Act based on a court’s interpretation of

Congressional intent?

3. Did Congress preempt state and common law remedies

in any manner in OPA 90?

ii

LIST OF PARTIES

The parties to the proceeding sought to be reviewed are

Petitioner, National Shipping Company of Saudi Arabia

(NSCSA); Respondents, Moran Mid-Atlantic Corporation,

Moran Trade Corporation of Delaware, Moran Towing of

Virginia, Inc., a division of Moran Mid-Atlantic Corporation.

NSCSA has no parent company and no nonwholly owned

subsidiaries.

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TABLE OF CONTENTS

Page

Questions Presented for Review ...............006. i

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SEPT LE LET EEL CE TEE EEE CE EEEE 1

I OE IIIs o.'s'c.5 od cw svsceeccdeseuss l

Constitutional and Statutory Provisions Involved ..... 2

UPPER oko ivcc cds cecccsccccsveces 3

A. District Court Jurisdiction ................. 3

le eS a rss see sacks accesses 3

CCR Gree ba wedevek dee seaiocaces 4

mumaeoms Tor Veramtime Ge Whit... ec cc cee % 7

EER A aR eg er a 13

TABLE OF CITATIONS

Cases Cited:

American Dredging Co. v. Miller, 510 U.S. 443 (1994)

eRe cd ViGhewdebcasns os ¥eekgee ee vo '4, 13

iv

Contents

Page

Askew v. American Waterways Operators, Inc., 411 U.S.

ARTES 65 60S OCA REG EN CCK ORES PERE EEO 11

Berman Enterprises, Inc. v. Jorling, 793 F. Supp. 408

(E.D.N.Y.), aff’d, 3 F.3d 602 (2d Cir. 1993), cert.

GUO, BOO Ue. Te CEP Kaho a vec Seki ae es 10

Boca Ciega Hotel, Inc. v. Bouchard Transp. Co., 51 F.3d |

feng ge, Lk ak... rene pene mmm TC a 10

Chick Kam Choo v. Exxon Corp., 486 U.S. 140 (1988)

EE RA TIT a aC Ne Minette 12

Frederick E. Bouchard, Inc. v. United States, 583 F. Supp.

ei Se Oe, errr ee ot eee 10

Gaspar v. United States, 460 F. Supp 656 (D. Mass. 1978)

TPE CSTE COTE CEE TO CPO Oe Cor eee 10

Golnay Barge v. Shinoussa, 1991 A.M.C. 2930 (S.D. Tex.

SHEE 4 6.60 canes 560k e eee ea eee 10

Huron Portland Cement Co. v. City of Detroit, 362 U.S.

CE ic ION s bic ok eae tase eae 12 |

|

In re Ballard Shipping, 32 F.3d 623 (1st Cir. 1994) ... 11, 12

In re Odin Marine Corp., 96 Cv. 5438 (S.D.N.Y., August

Vi ROE Cisse hakasbn ss eee esas eae 10

Intertanko v. Lowry, 947 F. Supp. 1484 (W.D. Wa. 1996)

ee Tee ee OO ee Pe rep ee Tee eee 12

Contents

Lewis v. Brunswick Corp., 97-288 ..........0000005

Montauk Oil Transp. Corp. v. Tug El Zorro Grande, 54

POG TOs CAO GM TPE 6 heater ie ieee

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

Steuart Transp. Co. v. Allied Towing Corp., 596 F.2d 609

FS EN Renner eripetnntaN pee

Tug Ocean Prince, Inc. v. United States, 584 F.2d 1151

(2d Cir. 1978), cert. denied, 440 U.S. 959 (1979) ..

United States v. Dixie Carriers, Inc. 736 F.2d 180 (Sth

Ce Se GES. ic ks cw rk betes ead ketene ohbes

United States v. Hollywood Marine, Inc., 625 F.2d 524

(Sth Cir.), cert. denied, 451 U.S. 994 (1980) ......

United States v. LeBeouf, 621 F.2d 787 (Sth Cir. 1980),

cert. denied, 452 U.S. 906 (1981) ...............

United States v. M/V Big Sam, 681 F.2d 432 (Sth Cir.

1982), cert. denied, 462 U.S. 1132 (1983) ........

United States v. Rivera, 942 F. Supp. 732 (D.P.R. 1996),

rev'd, 1997 Lexis 34186 (1st Cir. 1997) ..........

United States v. T/B Arcadian 95, 714 F.2d 470 (Sth Cir.

PD v-dAin hole CAs beets a bak a eeaenn

10

12

10

10

10

10

10

10

10

vi

Contents

Page

United States v. West of England Ship Owners Mut. Prot.,

Cre F.20 8192 URGE TROD viewer cdcescvanere 10

Yamaha Motor Corp. v. Calhoun, 116 S. Ct. 619 (1996)

ob adres eikincald Baie weave aCe Wales lea arta lds t2

Statutes Cited:

OO Wii D UB PE 6 666d pasgaacaeetaks exten I

Be Ulan § UGE « did e ei ENE Redo eee 3

oe UDA. FEROS vide Seas 0b rid eeee era 3

aD UDA GIFS ob oe ets chases ines 3

33 USL. Fares sc cc eee eee eerneeeinekee i, 4,5

3S UBL, ESI cao is teeeee shearers tiers 2

JS U.dikos § STORIE ED ws bv ON eee wabeeeens 6

SS Us Fave) os0d ca evawivweweneeores 2

33 UDG, ESAS neice ishueb eves eee ee peels 8

3S Viens ESTO 6 bis kee Caen erate w eles cores a

33 UK. § Dea. v0 ese nbvuye beewseewsaues 5

3S Uae § BFE ever s reer eeedereenee eas 6

vil

Contents

Page

PP Re Ro: ! a er Pee re ee re 6

OF TE 68 6 Fh 8 or Koes eeee weneenee snes 5, 7, 8, 12

p.BIG Lek Dey). Be ira mee Be

AG UB. SAGO GEIGER ees cece seecccrveweess 13

United States Constitution Cited:

RTE obo 6 Rete t EE EUUAR Sere ieee cu eivaséeees’s 2

Other Authorities Cited:

S. Rep. No. 99, 101st Cong., 2d Sess., reprinted in 1990

COB ae Ry. | GEARS AI eee ee 9

Gonyer, Six Years Before the Mast, 9 U. San Fran. Mar.

LJ. RPO Sa Viv de ecbbe senses cenekeudessss 9

McCurdy, OPA Overview & Relationship to Other Laws,

S$ U.S.P Mar. LiF. S39 CIS9S) occ eve ccccccccces 8

Mitchell, Preservation of State and Federal Authority

under the Oil Pollution Act of 1990, 21 Envtl. L. 237

by 5 I er ree ee er ee ee eee Ere 5

Morgan, The Oil Pollution Act of 1990, 6 Fordham

i Sart, | errr ery rer rrr re rere 8

Olafson, Stricken Barge Spurting Oil off Bolivar, Houston

Chronicle, March 19, 1996 .....cccccecccenccees 10

vill

Contents

Olafson, Gooey Mess Spreads Far, Fast, Houston

CINE, NE I BEE as wok sce weve ceesesdies

Olafson, Congealed Oil Spares Galveston, Houston

COICED, RMGE 2b, NOU tcc cde rccectbvnsaaves

“Rodriquez & Jaffe, The Oil Pollution Act of 1990, 15

WD : CS UPED oes suns bbdbeedese cere

Swanson, Federalism, the Admiralty and Oil Spills, 27 J.

Dene, Ba Ge CO, Bre CEE wen ics c0h Ke ueN ven

Wyatt, Navigating the Limits of State Spill Regulations, 8

eas Se Rady b COU wk waeGv i dbehactacacke’s

APPENDIX

Appendix A — Opinion Of The United States Court Of

Appeals For The Fourth Circuit Decided September 9,

[SPT Seieccheners mas suvedenees cee eteseks 6

Appendix B — Judgment And Opinion Of

The United States District Court For The Eastern

District Of Virginia, Norfolk Division Filed April 25,

Be ee er ee ee Oe re ee

Appendix C — Final Order Of The United States District

Court For The Eastern District Of Virginia, Norfolk

Division Dated May 29, 1996 ......ccccccvscees

Page

10

10

la

12a

56a

ix

Contents

Appendix D — Order Of The United States District Court

For The Eastern District Of Virginia, Norfolk Division

Filed September 18, 1995 .........0e eee eeeeeeee

Appendix E — Order Of The United States District Court

For The Eastern District Of Virginia, Norfolk Division

Filed August 14, 1995 ........ cece eee eee eens

Appendix F — Denial Of Petition For Rehearing Of The

United States Court Of Appeals For The Fourth Circuit

Filed October 6, 1997 .......cccccccccccesscens

Page

60a

62a

l

Petitioner, National Shipping Company of Saudi Arabia

(NSCSA) respectfully requests that a writ of certiorari be issued

to review the judgment of the United States Court of Appeals

for the Fourth Circuit in this case.

OPINIONS BELOW

The Opinion of the Court of Appeals for which review is

sought (Appendix, la) is unreported. The Opinion of the District

Court following the trial is reported at 924 F. Supp. 1436; 1996

A.M.C. 2604 (Appendix, 12a). The Order denying the motion

to amend the judgment in the District Court is unreported

(Appendix, 56a). The earlier District Court Order denying

reconsideration of the decision dismissing the state statutory

claim is also unreported (Appendix, 60a), as is the earlier District

Court decision dismissing the state statutory claim (Appendix,

62a). The Order denying the Petition for a Rehearing in the Court

of Appeals (Appendix, 73a) is unreported.

STATEMENT OF JURISDICTION

Petitioners seek review of an Opinion entered on September

9, 1997. The Order denying the Petition for Rehearing of that

Opinion was entered on October 6, 1997. This Petition for Writ

of Certiorari is filed within ninety days of the entry of the

October 6, 1997 Order denying the Petition for Rehearing. This

Court’s jurisdiction is invoked pursuant to 28 U.S.C. § 1254(1).

2

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

ARTICLé III OF THE CONSTITUTION

Section 2, Clause | of the United States Constitution

provides, in relevant part that:

The judicial power shall extend ... to all cases of

admiralty and maritime jurisdiction.

OIL POLLUTION ACT OF 1990 PROVISIONS

Section 1002(a) of the Oil Pollution Act of 1990 (OPA), 33

U.S.C. § 2702(a) provides in relevant part:

(a) In General. — notwithstanding any other

provision or rule of law, and subject to the provisions

of this Act, each responsible party for a vessel or a

facility from which oil is discharged, or which poses

the substantial threat of a discharge of oil, into or

upon the navigable waters or adjoining shorelines

or the exclusive economic zone is liable for the

removal costs and damages specified in Subsection

(b) that result from such incident.

Section 1002(d)(2)(A) of OPA, 33 U.S.C. § 2702(d)(2)(A)

States in pertinent part:

Owner or operator of vessel or facility — If the act

or omission of a third party that causes an incident

occurs in connection with the vessel or facility owned

or operated by the third party, the liability of the third

party shall be subject to the limits provided in Section

1004 as applied with respect to the vessel or facility.

3

Section 1004(a) of OPA, 33 U.S.C. § 2704(a) states in

relevant part:

General Rule — Except as otherwise provided in this

section, the total of the liability of a responsible party

under section 1002 and any removal costs incurred

by, or on behalf of, the responsible party, with respect

to each incident shall not exceed — ...

(2) for any other vessel, $600 per gross ton or

$500,000, whichever is greater...

Section 1018 (a) of OPA, 33 U.S.C.§ 2718(a) provides in

pertinent part:

Preservation of State Authorities; Solid Waste Disposal Act.

— Nothing in this Act... shall —...

(2) affect or be construed or interpreted to affect

or modify in any way the obligations or liabilities of

any person under the Solid Waste Disposal Act (42

U.S.C. 6901 et. seq.) or State law, including common

Law.

STATEMENT OF THE CASE

A. District Court Jurisdiction

Jurisdiction of the United States District Court, Eastern

District of Virginia was based on 28 U.S.C. §§ 1331, 1332, and

1333.

B. Procedural History

On December 1, 1993, the tug HARRIET MORAN, owned

4

by respondent Moran Trade Corporation of Delaware collided

with the M/V SAUDI DIRIYAH, a vessel owned by Petitioner

National Shipping Company of Saudi Arabia (NSCSA). As a

result of the collision, about 9,000 gallons of fuel oil were spilled

into the Elizabeth River. NSCSA took responsibility for the spill,

cleaned it up and settled most of the claims asserted by third

parties. In March, 1995, NSCSA filed a complaint, later

amended, against Respondents, arguing that the collision was

caused by Respondents’ negligence and asserting four different

theories of liability: (1) General Maritime Law; (2) Virginia’s

State Water Control Law; (3) Virginia Common Law; and (4)

The Oil Pollution Act of 1990, 33 U.S.C. § 2701, et seg. (OPA).

On August 14, 1995, the District Court entered an Order

dismissing Count II of the complaint which sought to recover

the response costs and third party settlement claims pursuant to

Virginia State Water Control Law. On September 18, 1995, the

Court denied the Petitioner’s motion for reconsideration or

clarification of the aforementioned Order.

The case was tried non-jury in January, 1996 and the Court

issued an Order dated April 25, 1996 finding Respondents Moran

solely responsible for the collision that caused the oil spii! but

limiting Moran’s liability to $500,000 pursuant to OPA 90. The

Court found that Petitioner NSCSA’s liability to others arose

solely under OPA 90 and accordingly NSCSA was limited to

claiming under that law and was preempted from claiming under

state law or common law. The Circuit Court affirmed this

decision.

C. Background

As former Senate Majority Leader George Mitchell has

explained, efforts to enact a comprehensive Federal Oil Pollution

Law had been stymied for many years due to a disagreement

a

5

about whether such a law should preempt state law regarding

oil spills.'

In 1989 and early 1990 there were a number of major spills

around the country which led to the passage of the Oil Pollution

Act of 1990 (OPA), 33 U.S.C. § 2701, et seq. Although the Act

sets forth a comprehensive Federal liability scheme regarding

discharges of oil onto the navigable waters, it specifically

reserves the right to claim under state law and common law and

it leaves the individual states free to enact such pollution liability

laws as they deem necessary.’ This is one of the main and most

controversial features of the Act.’

A second chord running through OPA is the notion that the

party responsible for the spilling vessel should cleanup the oil

and pay all claims in the first instance. Thus, the amounts paid

by the responsible party to remove the oil are credited to its

Limitation Fund.* 33 U.S.C. § 2704(a). If a responsible party

fails to cooperate and assist in the oil removal activities after

being requested to do so, the responsible party loses it’s right to

limit liability. 33 U.S.C. § 2704(c)(2). The Coast Guard is

required to officially notify the party responsible for the oil spill

of its designation as the source of the spill. The responsible party

has five days to deny this designation and if there is no denial,

the responsible party must begin advertising the procedures to

1. Mitchell, Preservation of State and Federal Authority under the

Oil Pollution Act of 1990, 21 Envtl. L. 237 (1991).

2. 33 U.S.C. § 2718

3. See Mitchell, supra, n.1.

4. This was not allowed under the Federal Water Pollution Control

Act, United States v. Dixie Carriers, Inc., 736 F.2d 180, 183 (Sth Cir.

1984).

6

submit claims. 33 U.S.C. § 2714. All claims must be submitted

to the responsible party in the first instance. 33 U.S.C. § 2713(a).

Even if it is the position of the responsible party that the spill

was caused solely by a third party, the responsible party must

still pay the removal costs in the first instance. 33 U.S.C.

§ 2702(d)(1)(B)(i).° Thus, there is an overriding intent in OPA

that the responsible party for the vessel spilling oil should

immediately begin to cleanup the oil and pay claims.

5. At the time the law was enacted, the sponsors left no doubt that

the intent was to force the spilling vessel to cleanup the oil and pay claims

immediately:

Our goal is to make certain that, when a spill occurs, the

polluter — not the taxpayer — will pay; and to make certain

that fishermen and property owners and hotel operators and

others hurt by a spill will be compensated — not 7 years

from now, not after lawyers have taken half or three-quarters

of the money, but quickly and fairly. 136 Cong. Rec. H6931

(daily ed. August 3, 1990) (statement of Rep. Studds)

The conference agreement is a strong statement that we

should never again be caught so unprepared. It tries to ensure

that industry and government are prepared for oil spills, and

that they respond quickly and effectively to contain them

and minimize damage.

To make sure that industry does clean up its spills, the

agreement requires ship and facility owners to prepare

response plans that ensure to the maximum extent practicable

sufficient private resources to deal with a worst-case spill.

136 Cong. Rec. $11537 (daily ed. August 2, 1990) (statement

of Sen. Baucus)

a

£ —~— Se

7

REASONS FOR GRANTING THE WRIT

The Opinion in National Shipping ignores these two

overriding themes in OPA and creates a dilemma for owners

and admiralty lawyers representing vessels which spill oil. If

those responsible for the vessel spilling oil accept responsibility

pursuant to OPA, under the reasoning of the court below, the

owner could be waiving any state or common law remedies for

contribution or indemnity. This creates an incentive to try to get

the local authorities to see that “State Law [is] . . . imposed to

force [the owner] to cleanup the spill or to compensate its

victims.”® This would be the only safe way to avoid preemption

and preserve the indemnity and contribution claims. One

possible way to achieve this goal would be to take no action

until ordered to do so by the state or local authorities. This is

contrary to OPA but is unfortunately one of the few options

available under the lower court’s decision.

The lower court’s interpretation of 33 U.S.C § 2718 is the

root of the problem. On its face, this section is not confusing. It

reads in relevant part as follows:

Nothing in this Act... shall

(2) affect, or be construed or interpreted to affect

or modify in any way the obligations or liabilities of

any person under . . . State Law, including common

Law.

This section was the basis for Petitioner’s claim that it had

indemnity and contribution actions under Virginia State and

common law regardless of any limitation contained in OPA or

anything else in the Act. This is the plain meaning of the words

6. National Shipping, Appendix, 10a.

of § 2718 and a view largely shared by the commentators on

OPA.’

Although the Respondents have obligations and liabilities

for contribution and indemnity under state and common law,

the lower court found that OPA shielded or protected the

Respondents from these obligations and liabilities. The court

made the implied finding that the Petitioner was preempted from

asserting these state and common law claims due to the limitation

amounts in OPA. The court held that state and common law

could be used in contribution and indemnity cases only if the

underlying obligation arose exclusively under state or common

law. Thus, the Petitioner was precluded by OPA from bringing

a state or common law action because the liability for the oil

spill arose “solely” under OPA.

The analysis in National Shipping is further complicated

by the court’s interpretation of 33 U.S.C. § 2704, the section

dealing with the effect of a vessel’s Limitation Fund. Although

7. See, e.g., Rodriquez & Jaffe, The Oil Pollution Act of 1990, 15

Tulane Mar. L.J. 1, 18 (1990) (“additional state liabilities are not subject

to limitation either under the Act itself, or pursuant to the Limitation

Act.”); Morgan, The Oil Pollution Act of 1990, 6 Fordham Envtl. L.J. 1,

6 (1995) (“Thus, OPA’s liability limits provide no protection for

responsible parties sued under State Law”); Swanson, Federalism, the

Admiralty and Oil Spills, 27 J. Mar. L. & Comm. 379, 415 (1996) (“Under

OPA and case law, each state is apparently allowed to fashion its own

liability rules beyond those established by the Federal Law. These state

Statues may be enforced even when they contravene the general Maritime

Law.”); Wyatt, Navigating the Limits of State Spill Regulations, 8 U.S.F.

Mar. L.J. 1, 12 (1995) (“OPA permits supplementation of its liability

scheme with ‘any additional liability or requirements,’ which seems to

permit the states not only to enlarge liabilities but also expand the

categories of responsible parties to include all participants in the risk-

creating activity”) (footnotes omitted); McCurdy, OPA Overview &

Relationship to Other Laws, 5 U.S.F Mar. L.J. 439-441 (1993).

9

difficult to follow, it appears that the key figure is not the

Limitation Fund of the vessel at fault for the spill but the

Limitation Fund of the blameless vessel. Under this reasoning,

if the M/V SAUDI DIRIYAH had an OPA Limitation Fund of

$500,000, under the exact same facts, it would be entitled to

recover in full from the defendants. Using this analysis, it is the

blameless vessel’s tonnage that is the determining factor on

whether or not there is preemption of state and common law. If

the blameless vessel has a low limitation figure under OPA, there

is no preemption and a party may claim under state and common

law. However, as in the present case, if the blameless ship

owner’s Limitation Fund is greater than the cost of the cleanup,

the owner cannot use state or common law to claim against the

vessel which caused the oil spill."

It is important that the confusion in the law engendered by

National Shipping be cleared up as soon as possible. In 1988,

the country imported 6 million barrels of oil per day and there

were about 3,800 port calls by oil tankers.’ Either these tankers

used tugs to assist in docking or anchored and then off loaded

the oil to barges propelled by tugs. ). “st oil spills involve more

- than one vessel and the uncertainty about when a party can use

8. One commentator, who specializes in marine pollution cases,

thought the lower court used an economic rationale for it’s decision and

then made a determination that the larger vessel derived a greater

economic benefit from the operation. Gonyer, Six Years Before the Mast,

9 U. San Fran. Mar. L.J. 105, 120-122 (1996). If this is the underpinning

for the decision, it is certainly contrary to the plain meaning of OPA and

the Congressional intent behind the law.

9. S. Rep. No. 99 at 3, 101st Cong., 2d Sess., reprinted in 1990

U.S.C.C.N. 751. While spills from tankers or barges pose the greatest

environmental risk, in the present case, the M/V Saudi Diriyah was not a

tanker and yet the clean up costs were far higher than the tug’s Limitation

Fund. There are hundreds of similar tug assisted movements to the one

in this case each week throughout the country.

10

state law might delay a cleanup and aggravate environmental

damages after a spill. Spills involving more than one vessel

generate a substantial amount of litigation’®. Indeed, the four

largest spills since the enactment of OPA have involved tugs

and barges''. The barges are larger and have higher Limitation

Funds than the tugs. The tugs are manned, provide the propulsive

force, and are usually to blame for the collision, grounding, or

other casualty that causes the oil spill. Since the oil would come

from the barge or tanker, the barge or tanker owner would be

the responsible party and would have a claim over against the

tug. The tug’s Limitation Fund under OPA is much smaller and

the barge or tanker owner will realize that even if it is blameless,

it might not recover the cost of the clean up due to the OPA

10. See, e.g., United States v. West of England Ship Owners Mut.

Prot., 872 F.2d 1192 (Sth Cir. 1989); United States v. Hollywood Marine,

Inc., 625 F.2d 524 (Sth Cir.), cert. denied, 451 U.S. 994 (1980); United

States v. LeBeouf, 621 F.2d 787 (Sth Cir. 1980), cert. denied, 452 U.S.

906 (1981); Frederick E. Bouchard, Inc. v. United States, 583 F. Supp.

477 (D. Mass 1984); United States v. M/V Big Sam, 681 F.2d 432 (Sth

Cir. 1982), cert. denied, 462 U.S. 1132 (1983); United States v. T/B

Arcadian 95, 714 F.2d 470 (Sth Cir. 1983); Steuart Transp. Co. v. Allied

Towing Corp., 596 F.2d 609 (4th Cir. 1979); Montauk Oil Transp. Corp.

v. Tug El Zorro Grande, 54 F.3d 111 (2d Cir. 1995); Tug Ocean Prince,

Inc. v. United States, 584 F.2d 1151 (2d Cir. 1978), cert. denied, 440

U.S. 959 (1979); Gaspar v. United States, 460 F. Supp 656 (D. Mass.

1978); Golnay Barge v. Shinoussa, 1991 A.M.C. 2930 (S.D. Tex. 1991).

11. TAMPA BAY SPILL — Boca Ciega Hotel, Inc. v. Bouchard

Transp. Co., 51 F.3d 235 (11th Cir. 1995); PUERTO RICO SPILL —

United States v. Rivera, 942 F. Supp 732 (D.P.R. 1996), rev'd, 1997 Lexis

34186 (1st Cir. 1997) (en banc); RHODE ISLAND SPILL — /n re Odin

Marine Corp. 96 CV. 5438 (S.D.N.Y.) (decision of Judge Stein August 7,

1997); TEXAS SPILL — Olafson, Stricken Barge Spurting Oil off Bolivar,

Houston Chronicle, March 19, 1996 at 11; Olafson, Gooey Mess Spreads

Far, Fast, Houston Chronicle, March 20, 1996 at 23; Olafson, Congealed

Oil Spares Galveston, Houston Chronicle, March 21, 1996 at 33.

11

limitation amount for the tug unless it has the grounds to assert

a claim under state or common law. This is the lesson that

National Shipping sends out to vessel owners and those who

practice marine pollution law.

There is a fundamental conflict between the holding in

National Shipping and the First Circuit Court’s decision in /n re

Ballard Shipping, 32 F.3d 623 (Ist Cir. 1994). In Ballard, the

court held that

an injured party may have claims arising from a

single accident both under federal maritime law and

under state law, whether legislation or common law.

Ballard, supra at 626. Even though the First Circuit Court in

Ballard affirmed the dismissal of the federal claims, it allowed

state !aw claims arising from the same incident to go forward.

It relied in part on § 2718(a) of OPA which allows additional

state law liability. The spill in Ballard occurred before OPA was

enacted but the court found that the non-retroactivity of OPA

was irrelevant. In contrast, the Fourth Circuit Court in National

Shipping made a determination the Petitioner’s liability arose

solely under OPA and held that since this liability arose under

OPA 90, the Petitioner could not claim under state or common

law due to the preemption in OPA 90. In other words, the

Petitioner could have only one claim up to its Limitation Fund

and that claim was under OPA.

The holding in National Shipping is also a clear departure

from the recent trend of Supreme Court and lower court cases

involving preemption of state and common law in the pollution

area. In Askew v. American Waterways Operators, Inc., 411 U.S.

25 (1973), this Court sustained a Florida statue that imposed

no fault liability on vessel owners and operators for damages

caused by oil spills in territorial waters and rejected a maritime

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law preemption challenge. Similarly, in Huron Portland Cement

Co. v. City of Detroit, 362 U.S. 440 (1960), the Court held that

state air pollution laws were a classic example of police power

and that the state could act in such areas of interstate commerce

and maritime activity concurrent with the federal government.

Lower courts have followed this trend. Thus, in Ballard, supra,

the court held that the Rhode Island State Law was not preempted

by applicable Federal Law. OPA 90 did not apply to this case

although the court left little doubt that OPA 90 compelled it to

allow the claims under Rhode Island Law. In a case interpreting

Section 2718 of OPA, a New York court held that a New York

pollution statute was not preempted by OPA. Berman

Enterprises, Inc. v. Jorling, 793 F. Supp. 408, 414-16 (E.D.N.Y.),

aff'd, 3 F.3d 602 (2d Cir. 1993), cert. denied, 510 U.S. 1073

(1994). In another case interpreting Section 2718 of OPA, the

District Court in Seattle held that the OPA 90 non preemption

language applied to Washington State regulations which

governed tanker operations and other maritime subjects.

Intertanko v. Lowry, 947 F. Supp 1484 (W.D. Wa. 1996).

A large part of this Court’s admiralty docket over the past

few years has dealt with the conflict between State Law and

Federal Admiralty Law; both statutory and judge made

Admiralty Law. Apparently, there remains confusion in some

courts about when State Law is preempted by Federal Law. In

certain admiralty cases, this Court has made it clear that there

is no preemption. See, e.g., Yamaha Motor Corp. v. Calhoun,

116 S. Ct. 619 (1996); American Dredging Co. v. Miller, 510

U.S. 443 (1994); Chick Kam Choo v. Exxon Corp. 486 U.S. 140

(1988). In other admiralty cases, the Court has held that State

Law cannot be used in certain admiralty actions. See, e.g.,

Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207 (1986). This

Court has recognized that this choice of law puzzle is very

difficult and

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it would be idle to pretend that the line separating

permissible from impermissible state regulation is

readily discernible in our admiralty jurisprudence,

or indeed is even entirely consistent within our

admiralty jurisprudence.

American Dredging, supra. at 452. Justice Ginsburg repeated

Justice Scalia’s quote in Yamaha, supra and then wrote “we

attempt no grand synthesis or reconciliation of our precedent

today ...” and left many questions for another day. Yamaha,

supra at 626 n.8. That day has arrived for this area of the law.

Although OPA 90 and prior Supreme Court cases dealing with

preemption in pollution cases may seem to draw a clear, bright

line on the choice of law issue, this line is not discernible in

National Shipping and the holding in National Shipping will

spawn other cases which will blur the line even further.

This Court has recognized the importance of the preemption

issue and the need for clear guidelines about when Federal law

will preempt state and common law in statutory claims. The

Court has granted certiorari in Lewis v. Brunswick Corp., 97-

288. The questions presented in that case deal with the implied

preemption of state common law claims under the Boat Safety

Act, 46 U.S.C. § 4301, et seq. The decision in National Shipping

deals with the implied preemption of state and common law

claims under OPA and raises many of the same issues as Lewis

in the maritime oil pollution area. The main difference is that in

the maritime pollution area, the unsettled law could cause a delay

in cleaning up a large spill and could aggravate environmental

damage. This uncertainty should be resolved prior to the next

large oil spill which history shows us, is sure to occur.

CONCLUSION

1. For the forgoing reasons, this Court should grant the

petition and exercise its jurisdiction to resolve the confusion

14

about the preemption of state and common law ina maritime

oil spill case.

2. In the alternative, Petitioner prays for a summary reversal

of the decision below.

3. In the alternative, Petitioner requests that certiorari be

granted and National Shipping be identified as a companion case

to Lewis v. Brunswick Corp., 97-288 because of the similarity

of issues involving the implied or explicit preemption of state

law by federal statutes dealing with maritime matters.

4. In the alternative, Petitioner prays that the Court hold

the case without action until Lewis v. Brunswick Corp. is decided

and then either grant certiorari to consider any issues not decided

in that case or grant certiorari and vacate and remand in light of

the decision in Lewis v. Brunswick Corp.

Respectfully submitted,

PATRICK J. BONNER

Counsel of Record

FREEHILL, HOGAN & MAHAR

80 Pine Street

New York, NY 10005

(212) 425-1900

JOHN R. CRUMPLER, JR.

KAUFMAN & CANOLES, P.C.

2000 Nations Bank Center

One Commercial! Place

P.O. Box 3037

Norfolk, VA 23514

(757) 624-3103

Attorneys for Petitioner

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