In the Matter Of: The Complaint of Healy Tibbitts Builders, Inc.

Filing 241

ORDER DENYING THIRD-PARTY DEFENDANT OWL INTERNATIONAL, INC., DBA GLOBAL'S MOTION TO DISMISS PURSUANT TO RULE 12(b)(6) OF THE FEDERAL RULES OF CIVIL PROCEDURE, ECF NO. 160 . Signed by CHIEF JUDGE J. MICHAEL SEABRIGHT on 6/15/2017. (afc)< font size=1>WRITTEN ORDER follows hearing held June 13, 2017. Minutes of Hearing: ECF no. 240 in 1:15-cv-00520-JMS-KJM and ECF no. 204 in 1:16-cv-00156-JMS-KJM.Third-party Owl International, Inc.'s MOTION to Dismiss: ECF no. 160 in 1:15 -cv-00520-JMS-KJM and ECF no. 126 in 1:16-cv-00156-JMS-KJM.Associated Cases: 1:15-cv-00520-JMS-KJM, 1:16-cv-00156-JMS-KJMCERTIFICATE OF SERVICEParticipants registered to receive electronic notificat ions received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII

In the Matter of
The Complaint of HEALY TIBBITTS
BUILDERS, INC., as owner pro hac vice
of WEEKS 544, O.N. 520935, for
Exoneration from or Limitation of
Liability.
_________________________________
In the Matter of
The Complaint and Petition of the United
States of America in a Cause for
Exoneration from or Limitation of
Liability with Respect to Navy Barge
YCV-23 Re the Incident Involving
Mooring Buoy in Pearl Harbor on
December 10, 2014.

Civ. No. 15-00520 JMS-KJM
Civ. No. 16-00156 JMS-KJM
(CONSOLIDATED CASES)

ORDER DENYING THIRD-PARTY
DEFENDANT OWL
INTERNATIONAL, INC., DBA
GLOBAL’S MOTION TO DISMISS
PURSUANT TO RULE 12(b)(6) OF
THE FEDERAL RULES OF CIVIL
PROCEDURE, ECF NO. 160

ORDER DENYING THIRD-PARTY DEFENDANT OWL
INTERNATIONAL, INC., DBA GLOBAL’S MOTION TO DISMISS
PURSUANT TO RULE 12(b)(6) OF THE FEDERAL RULES OF CIVIL
PROCEDURE, ECF NO. 160
I. INTRODUCTION
These consolidated admiralty limitation-of-liability Petitions brought
under 46 U.S.C. §§ 30501-30512 arise from a December 10, 2014 incident at Pearl
Harbor, where two persons were killed and several others allegedly were seriously

1

injured. Third-Party Defendant Owl International, Inc., dba Global Government
Services (“Global”) moves pursuant to Federal Rule of Civil Procedure 12(b)(6) to
dismiss the Third-Party Complaint filed by Truston Technologies, Inc. (“Truston”).
ECF No. 160 (the “Motion”). 1
Because Global relies on evidence in making its arguments, the court
exercises its discretion to consider that evidence, and thus construes the Motion as
one for summary judgment under Rule 56. See Fed. R. Civ. P. 12(d); Hamilton
Materials, Inc. v. Dow Chem. Corp., 494 F.3d 1203, 1207 (9th Cir. 2007).
So construed, the Motion is DENIED because genuine issues of
material fact exist as to Global’s actions that are alleged to have caused or
contributed to the December 10, 2014 incident. See, e.g., T.W. Elec. Serv., Inc. v.
Pac. Elec. Contractors Ass’n, 809 F.2d 626, 631 (9th Cir. 1987) (“[I]f a rational
trier of fact might resolve the issue in favor of the nonmoving party, summary
judgment must be denied.”) (citing Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 587 (1986)).
II. BACKGROUND
The court briefly sets forth the basic background to provide context
for the Motion only -- this section does not explain all the allegations in the
1

Although these are consolidated cases, docket references are to Civ. No. 15-00520
JMS-KJM.

2

Petitions, or attempt to present a comprehensive discussion of the facts alleged in
the underlying actions. 2 In so doing, the court accepts as true all well-pleaded
factual allegations, and draws all reasonable inferences in favor of the nonmoving
parties. See, e.g., Retail Prop. Tr. v. United Bhd. of Carpenters & Joiners of Am.,
768 F.3d 938, 945 (9th Cir. 2014) (setting forth Rule 12(b)(6) standard); In re
Barboza, 545 F.3d 702, 707 (9th Cir. 2008) (reiterating Rule 56 standards).
The actions arise from a December 10, 2014 incident in Pearl Harbor.
The U.S. Navy had contracted with Truston to upgrade moorings or certain
mooring structures, and Truston in turn subcontracted with Healy Tibbitts
Builders, Inc. (“Healy Tibbitts”) for some of the work. Pet. at 3, ECF No. 1.
During the incident, mooring buoy D-8-H was lifted by a crane aboard the
Barge/Vessel “Weeks 544,” owned by Healy Tibbitts. Id. at 4. The buoy was
suspended above deck of an adjacent “YCV Barge,” owned by the Navy. Id. As
alleged, “[w]hile the buoy was suspended above the deck, workers began
connecting a large concrete sinker block, which was on the deck of the YCV barge,

2

Four different cases are at issue: In re Complaint of Healy Tibbitts Builders, Inc., Civ.
No. 15-00520 JMS-KJM; Saragosa, et al. v. Truston Technologies, et al., Civ. No. 15-00534
JMS-KJM; Makua III, et al. v. Truston Technologies, et al., Civ. No. 15-00540 JMS-KJM; and
In re Complaint and Petition of the United States of America re Navy Barge YCV-23, Civ. No.
16-00156 JMS-KJM. Additionally, a related declaratory relief action was recently transferred to
this District from the Eastern District of Virginia: Truston Technologies v. Healy Tibbitts
Builders, Inc. et al., Civ. No. 17-00152 JMS-KJM.

3

to the buoy’s anchor chain.” Id. “Before the connection could be completed, the
capture plate on at the top of the buoy failed, causing the buoy to slide down the
anchor chain to the concrete sinker block.” Id. Two Healy Tibbitts workers
(Justin Saragosa and Joefrey Andrada) were killed, and at least three others (David
Makua III, Cesario Gaspar, and Willie Antonio) were seriously injured.
Complaints were filed against Truston, Healy Tibbitts, Weeks Marine
Inc., and the Vessel Weeks 544. Healy Tibbitts then filed a limitation of liability
petition under 46 U.S.C. §§ 30501-30512, wherein claims were made by
(1) Saragosa and Andrada (or by their estates and family members) (the
“Saragosa/Andrada Plaintiffs”); (2) Makua, Gaspar and Antonio (collectively, the
“Makua Plaintiffs”); and (3) Truston. ECF Nos. 13-15, 17, 26. In turn, Truston
filed a Third-Party Complaint sounding in contribution/indemnity and joint/several
liability against both the United States and Global. (The United States then filed
its own limitation petition, in which the same parties filed claims, and the two
Petitions were consolidated.)
Truston’s Third-Party Complaint alleges that an Occupational Safety
and Health Administration (“OSHA”) investigation revealed that the flange or
capture plate on buoy D-8-H was corroded, with most of the bolts having “rusted
completely away.” Third-Party Compl. ¶¶ 23, 24, ECF No. 119. It further alleges

4

that “Global was responsible to inspect and maintain the buoy and failed to do so.”
Id. ¶ 26. And it alleges, on information and belief, that “Global painted over the
corroded bolts, capture plate, and flange plate instead of properly maintaining the
same.” Id. at ¶ 27.
Count II (against Global) of the Third-Party Complaint alleges that
“Global is a civilian contractor whose responsibility it was to maintain equipment
at NISMO [Naval Inactive Ships Maintenance Office] Pearl Harbor, including the
subject buoy.” Id. at ¶ 36. It repeats, “[o]n information and belief, Global painted
over corrosion on the buoy, including but not limited to, painting over the corroded
bolts, capture plate, and flange plate.” Id. ¶ 37. “Global had a duty to maintain the
buoy and its flange plates, flange plate bolts and/or capture plate.” Id. ¶ 38.
“Global breached its duty and actively covered over and hid corrosion on the
subject buoy.” Id. ¶ 39. “Global’s breach of its duty is a legal cause of the
accident and injuries/death of Healy Tibbitts employees.” Id. ¶ 40.
Count III (against both the United States and Global) of the ThirdParty Complaint is based on failure to warn. As to Global, it alleges that “USA
and Global had a duty to warn Truston about the risk posed by the Navy property
in Pearl Harbor.” Id. ¶ 44. “The failure to warn Truston of such a known defect by
both Third-Party Defendants was the legal cause of the accident.” Id. ¶ 45.

5

Global’s Motion seeks to dismiss the Third-Party Complaint. The
Motion was heard on June 13, 2017, where the court gave its oral ruling. This
Order explains that ruling in more detail.
III. DISCUSSION
Global’s Motion to Dismiss under Rule 12(b)(6) is based on Bell
Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S.
662 (2009), arguing that the Third-Party Complaint fails to allege sufficient facts
that establish Global’s duty. ECF No. 160-1 at 8. It argues that Global does not
own the buoy, that Truston (not Global) had a duty to “maintain” the buoy, and
that (assuming Global’s alleged duty was based on Global’s contract with the
Navy) Global’s contract did not require Global to “maintain” the buoy.
Global’s Motion, however, attaches evidence outside of the pleadings
-- a declaration from a Global Vice President attesting that “GLOBAL is not
required to independently maintain the buoys,” Marginean Decl. ¶ 6, ECF No. 1603; and Global’s contract with the Navy, ECF No. 160-4, purportedly indicating that
Global was not required to “maintain” the buoy. In this regard, Rule 12(d)
provides that “[i]f, on a motion under Rule 12(b)(6) . . . matters outside the
pleadings are presented to and not excluded by the court, the motion must be
treated as one for summary judgment under Rule 56.” And Hamilton Materials

6

explains that the court has “discretion to accept and consider extrinsic materials
offered in connection with [a motion to dismiss], and to convert the motion to one
for summary judgment when a party has notice that the district court may look
beyond the pleadings.” 494 F.3d at 1207.
Applied here -- although Rule 12(d) gives the court discretion to
exclude Global’s evidence in addressing the Motion -- it is more appropriate and
efficient to convert the Motion to a Rule 56 motion for summary judgment. Global
certainly had notice that this was possible (and Global’s counsel at the hearing
agreed that such treatment is appropriate). Indeed, “a represented party who
submits matters outside the pleadings to the judge and invites consideration of
them has notice that the judge may use them to decide a motion originally noted as
a motion to dismiss, requiring its transformation to a motion for summary
judgment.” Olsen v. Idaho St. Bd. of Med., 363 F.3d 916, 922 (9th Cir. 2004)
(quoting San Pedro Hotel Co. v. City of L.A., 159 F.3d 470, 477 (9th Cir. 1998)
(internal quotation marks omitted)).
So construed, Truston responds to the Motion by pointing out that
Rule 14(c)(2) 3 regarding admiralty claims applies, and requires Third-Party

3

Rule 14(c), entitled “Admiralty or Maritime Claim,” provides:
(continued . . . )
7

Defendant Global to be responsive not only to Truston’s indemnity/joint liability
claims, but also to claims of both the Saragosa/Andrada Plaintiffs and the Makua
Plaintiffs.
Truston responds on the merits with ample evidence creating a
genuine issue of material fact as to Global’s alleged actions and duties. See ECF
No. 213 at 3-14 (and exhibits attached thereto). For example, the evidence
specifically indicates that the Navy contracted with Global to “inter alia, inspect,
repair and refurbish the hawespipe buoys at NISMO.” ECF No. 213-2 at 8. It
indicates that Global actually inspected Buoy D-8-H. ECF No. 213-3 at 5. There
is deposition testimony from an OSHA inspector that the weld on the relevant
flange had corroded and was painted after the corrosion occurred. ECF No. 213 at
9 (citing testimony). At minimum, there is a question of fact as to whether
(. . . continued)
(1) Scope of Impleader. If a plaintiff asserts an admiralty or maritime claim under
Rule 9(h), the defendant or a person who asserts a right under Supplemental Rule
C(6)(a)(i) may, as a third-party plaintiff, bring in a third-party defendant who may
be wholly or partly liable -- either to the plaintiff or to the third-party plaintiff -for remedy over, contribution, or otherwise on account of the same transaction,
occurrence, or series of transactions or occurrences.
(2) Defending Against a Demand for Judgment for the Plaintiff. The third-party
plaintiff may demand judgment in the plaintiff's favor against the third-party
defendant. In that event, the third-party defendant must defend under Rule 12
against the plaintiff’s claim as well as the third-party plaintiff’s claim; and the
action proceeds as if the plaintiff had sued both the third-party defendant and the
third-party plaintiff.
(Emphasis added).

8

Global’s duties include “maintaining” the buoys. That is, the court is not
persuaded by Global’s attempt to cabin its admitted duty to “inspect, repair and
refurbish” as not including a duty to “maintain” buoys. Moreover, as discussed at
the hearing, there are also questions of fact regarding the adequacy of Global’s
inspection of the buoys -- Global argues that its report of its inspection (some
three-months before the December 2014 incident) of buoy D-8-H found that the
buoy was in “fair” condition, with the capture plate being in “good” condition.
ECF No. 213-4 at 8. If the incident was caused, at least in part, by a failure of that
capture plate (which was corroded with missing bolts), there is a genuine issue of
material fact as to whether the inspection itself was proper.4
///
///
///
///
///
///

4

The court recognizes that discovery is ongoing, and that the court has a limited view of
the evidence regarding potential causes of the incident. There may well be other evidence that
might put the report of the buoy inspections in a different light. And so, future dispositive
motions, even on this issue, are not precluded. But at this point in the proceedings, Global has
not met its burden to demonstrate that summary judgment should be granted in its favor.

9

IV. CONCLUSION
Construing the evidence in the light most favorable to the non-moving
parties, summary judgment is inappropriate. Third-Party Defendant Owl
International, Inc., dba Global’s Motion to Dismiss the Third-Party Complaint,
ECF No. 160, is DENIED.
IT IS SO ORDERED.
DATED, Honolulu, Hawaii, June 15, 2017.

/s/ J. Michael Seabright
J. Michael Seabright
Chief United States District Judge

In re Complaint of Healy Tibbitts Builders, Inc., Civ. No. 15-00520 JMS-KSC; In re Complaint
and Petition of the United States of America in a Cause for Exoneration from or Limitation of
Liability re Navy Barge YCV-23, Civ. No. 16-00156 JMS-KSC, Order Denying Third-Party
Defendant Owl International, Inc., dba Global’s Motion to Dismiss Pursuant to Rule 12(b)(6) of
the Federal Rules of Civil Procedure, ECF No. 160.

10